KOREA – ANTI-DUMPING DUTIES ON PNEUMATIC VALVES FROM JAPAN AB-2018-3
Document: Report of the Appellate Body
Date: 10 September 2019
Document codes: WT/DS504/AB/R
Complainant: Japan
Respondent: South Korea
Third parties: Brazil, China, Ecuador, EU, Norway, Singapore, Turkey, U.S., Vietnam
Dispute stage: Appellate Body
Agreements cited: Art. 3.1  Anti-dumpingArt. VI  GATT 1994Art. 3.2, 3.4, 3.5, 4.1, 6.5, 6.5.1, 6.9, 12.2, 12.2.2, 1  Anti-dumping

KOREA – ANTI-DUMPING DUTIES ON PNEUMATIC VALVES FROM JAPAN
AB-2018-3
Report of the Appellate Body

ABBREVIATIONS USED IN THIS REPORT
Abbreviation Description
Anti-Dumping Agreement Agreement on Implementation of Article VI of the General Agreement
on Tariffs and Trade 1994
BCI business confidential information
CKD CKD Corporation
DSB Dispute Settlement Body
DSU Understanding on Rules and Procedures Governing the Settlement of
Disputes
GATT 1994 General Agreement on Tariffs and Trade 1994
Japan's panel request Request for the Establishment of a Panel by Japan,
Korean investigating
authorities
Korea Trade Commission and Office of Trade Investigation
KCC KCC Co., Ltd.
KTC Korea Trade Commission
KTC's Final Resolution KTC, Resolution of Final Determination on Dumping and Injury to
Domestic Industry of Valves for Pneumatic Transmissions from Japan,
20 January 2015 (Panel Exhibits JPN-4b (public version) and KOR-1b
(BCI))
KTC's Preliminary
Resolution
KTC, Resolution of Preliminary Determination on Dumping and Injury
to the Domestic Industry of Valves for Pneumatic Transmissions from
Japan, 26 June 2014 (Panel Exhibit JPN-1b)
MOSF Minister/Ministry of Strategy and Finance
MOSF's Decree No. 498 MOSF, Decree No. 498, Regulation Concerning the Imposition of
Anti-Dumping Duties on Valves for Pneumatic Transmissions
originating from Japan, 19 August 2015 (Panel Exhibit JPN-6b)
MOSF's Public
Announcement
MOSF, Public Announcement No. 2015-156, Decision to Apply
Anti-Dumping Duties on the Pneumatic Transmissions Valves from
Japan, 19 August 2015 (Panel Exhibit KOR-3b (BCI))
OTI Office of Trade Investigation
OTI's Final Report OTI, Final Report on Dumping and Injury to Domestic Industry of
Valves for Pneumatic Transmissions Imported from Japan,
20 January 2015 (Panel Exhibits JPN-5b (public version) and KOR-2b
(BCI))
OTI's Interim Report OTI, Interim Investigation Report on Dumping and Injury to Domestic
Industry of Valves for Pneumatic Transmissions from Japan,
23 October 2014 (Panel Exhibit JPN-3b)
OTI's Preliminary Report OTI, Preliminary Report on Dumping and Injury to Domestic Industry
of Valves for Pneumatic Transmissions imported from Japan,
26 June 2014 (Panel Exhibit JPN-2b)
Panel Report Korea – Anti-Dumping Duties on Pneumatic Valves from Japan
(WT/DS504/R)
pneumatic valves valves for pneumatic transmissions
POI period of investigation
SG&A selling, general, and administrative (costs)
Shin Yeong Shin Yeong Mechatronics
SMC SMC Corporation

Abbreviation Description
TPC TPC Mechatronics Corporation
Working Procedures Working Procedures for Appellate Review, WT/AB/WP/6,
16 August 2010
WTO World Trade Organization
Yonwoo Yonwoo Pneumatic

CASES CITED IN THIS REPORT
Short Title Full Case Title and Citation
Argentina – Footwear (EC) Appellate Body Report, Argentina – Safeguard Measures on Imports of
Footwear, WT/DS121/AB/R, adopted 12 January 2000, DSR 2000:I, p. 515
Argentina – Import Measures Appellate Body Reports, Argentina – Measures Affecting the Importation of
Goods, WT/DS438/AB/R / WT/DS444/AB/R / WT/DS445/AB/R, adopted
26 January 2015, DSR 2015:II, p. 579
Argentina – Poultry
Anti-Dumping Duties
Panel Report, Argentina – Definitive Anti-Dumping Duties on Poultry from
Brazil, WT/DS241/R, adopted 19 May 2003, DSR 2003:V, p. 1727
Australia – Apples Appellate Body Report, Australia – Measures Affecting the Importation of
Apples from New Zealand, WT/DS367/AB/R, adopted 17 December 2010,
DSR 2010:V, p. 2175
Australia – Salmon Appellate Body Report, Australia – Measures Affecting Importation of Salmon,
WT/DS18/AB/R, adopted 6 November 1998, DSR 1998:VIII, p. 3327
Brazil – Desiccated Coconut Appellate Body Report, Brazil – Measures Affecting Desiccated Coconut,
WT/DS22/AB/R, adopted 20 March 1997, DSR 1997:I, p. 167
Brazil – Retreaded Tyres Appellate Body Report, Brazil – Measures Affecting Imports of Retreaded
Tyres, WT/DS332/AB/R, adopted 17 December 2007, DSR 2007:IV, p. 1527
Canada – Periodicals Appellate Body Report, Canada – Certain Measures Concerning Periodicals,
WT/DS31/AB/R, adopted 30 July 1997, DSR 1997:I, p. 449
Canada – Renewable Energy
/ Canada – Feed-in Tariff
Program
Appellate Body Reports, Canada – Certain Measures Affecting the Renewable
Energy Generation Sector / Canada – Measures Relating to the Feed-in Tariff
Program, WT/DS412/AB/R / WT/DS426/AB/R, adopted 24 May 2013,
DSR 2013:I, p. 7
Chile – Price Band System Appellate Body Report, Chile – Price Band System and Safeguard Measures
Relating to Certain Agricultural Products, WT/DS207/AB/R, adopted
23 October 2002, DSR 2002:VIII, p. 3045 (Corr.1, DSR 2006:XII, p. 5473)
Chile – Price Band System
(Article 21.5 – Argentina)
Appellate Body Report, Chile – Price Band System and Safeguard Measures
Relating to Certain Agricultural Products – Recourse to Article 21.5 of the DSU
by Argentina, WT/DS207/AB/RW, adopted 22 May 2007, DSR 2007:II, p. 513
China – Autos (US) Panel Report, China – Anti-Dumping and Countervailing Duties on Certain
Automobiles from the United States, WT/DS440/R and Add.1, adopted
18 June 2014, DSR 2014:VII, p. 2655
China – Cellulose Pulp Panel Report, China – Anti-Dumping Measures on Imports of Cellulose Pulp from
Canada, WT/DS483/R and Add.1, adopted 22 May 2017, DSR 2017:IV, p. 1961
China – GOES Appellate Body Report, China – Countervailing and Anti-Dumping Duties on
Grain Oriented Flat-Rolled Electrical Steel from the United States,
WT/DS414/AB/R, adopted 16 November 2012, DSR 2012:XII, p. 6251

Short Title Full Case Title and Citation
China – GOES Panel Report, China – Countervailing and Anti-Dumping Duties on Grain
Oriented Flat-Rolled Electrical Steel from the United States, WT/DS414/R and
Add.1, adopted 16 November 2012, upheld by Appellate Body Report
WT/DS414/AB/R, DSR 2012:XII, p. 6369
China – HP-SSST (Japan) /
China – HP-SSST (EU)
Appellate Body Reports, China – Measures Imposing Anti-Dumping Duties on
High-Performance Stainless Steel Seamless Tubes ("HP-SSST") from Japan /
China – Measures Imposing Anti-Dumping Duties on High-Performance
Stainless Steel Seamless Tubes ("HP-SSST") from the European Union,
WT/DS454/AB/R and Add.1 / WT/DS460/AB/R and Add.1, adopted
28 October 2015, DSR 2015:IX, p. 4573
China – HP-SSST (Japan) /
China – HP-SSST (EU)
Panel Reports, China – Measures Imposing Anti-Dumping Duties on
High-Performance Stainless Steel Seamless Tubes ("HP-SSST") from Japan /
China – Measures Imposing Anti-Dumping Duties on High-Performance
Stainless Steel Seamless Tubes ("HP-SSST") from the European Union,
WT/DS454/R and Add.1 / WT/DS460/R, Add.1 and Corr.1, adopted
28 October 2015, as modified by Appellate Body Reports WT/DS454/AB/R /
WT/DS460/AB/R, DSR 2015:IX, p. 4789
China – Rare Earths Appellate Body Reports, China – Measures Related to the Exportation of Rare
Earths, Tungsten, and Molybdenum, WT/DS431/AB/R / WT/DS432/AB/R /
WT/DS433/AB/R, adopted 29 August 2014, DSR 2014:III, p. 805
China – Raw Materials Appellate Body Reports, China – Measures Related to the Exportation of
Various Raw Materials, WT/DS394/AB/R / WT/DS395/AB/R / WT/DS398/AB/R,
adopted 22 February 2012, DSR 2012:VII, p. 3295
China – X-Ray Equipment Panel Report, China – Definitive Anti-Dumping Duties on X-Ray Security
Inspection Equipment from the European Union, WT/DS425/R and Add.1,
adopted 24 April 2013, DSR 2013:III, p. 659
Colombia – Textiles Appellate Body Report, Colombia – Measures Relating to the Importation of
Textiles, Apparel and Footwear, WT/DS461/AB/R and Add.1, adopted
22 June 2016, DSR 2016:III, p. 1131
EC – Approval and Marketing
of Biotech Products
Panel Reports, European Communities – Measures Affecting the Approval and
Marketing of Biotech Products, WT/DS291/R, Add.1 to Add.9 and Corr.1 /
WT/DS292/R, Add.1 to Add.9 and Corr.1 / WT/DS293/R, Add.1 to Add.9 and
Corr.1, adopted 21 November 2006, DSR 2006:III, p. 847
EC – Asbestos Appellate Body Report, European Communities – Measures Affecting Asbestos
and Asbestos-Containing Products, WT/DS135/AB/R, adopted 5 April 2001,
DSR 2001:VII, p. 3243
EC – Bananas III Appellate Body Report, European Communities – Regime for the Importation,
Sale and Distribution of Bananas, WT/DS27/AB/R, adopted
25 September 1997, DSR 1997:II, p. 591
EC – Bed Linen (Article 21.5
– India)
Appellate Body Report, European Communities – Anti-Dumping Duties on
Imports of Cotton-Type Bed Linen from India – Recourse to Article 21.5 of the
DSU by India, WT/DS141/AB/RW, adopted 24 April 2003, DSR 2003:III,
p. 965
EC – Export Subsidies on
Sugar
Appellate Body Report, European Communities – Export Subsidies on Sugar,
WT/DS265/AB/R, WT/DS266/AB/R, WT/DS283/AB/R, adopted 19 May 2005,
DSR 2005:XIII, p. 6365
EC – Fasteners (China) Appellate Body Report, European Communities – Definitive Anti-Dumping
Measures on Certain Iron or Steel Fasteners from China, WT/DS397/AB/R,
adopted 28 July 2011, DSR 2011:VII, p. 3995
EC – Fasteners (China) Panel Report, European Communities – Definitive Anti-Dumping Measures on
Certain Iron or Steel Fasteners from China, WT/DS397/R and Corr.1, adopted
28 July 2011, as modified by Appellate Body Report WT/DS397/AB/R,
DSR 2011:VIII, p. 4289

Short Title Full Case Title and Citation
EC – Fasteners (China)
(Article 21.5 – China)
Appellate Body Report, European Communities – Definitive Anti-Dumping
Measures on Certain Iron or Steel Fasteners from China – Recourse to
Article 21.5 of the DSU by China, WT/DS397/AB/RW and Add.1, adopted
12 February 2016, DSR 2016:I, p. 7
EC – Hormones Appellate Body Report, European Communities – Measures Concerning Meat
and Meat Products (Hormones), WT/DS26/AB/R, WT/DS48/AB/R, adopted
13 February 1998, DSR 1998:I, p. 135
EC – Poultry Appellate Body Report, European Communities – Measures Affecting the
Importation of Certain Poultry Products, WT/DS69/AB/R, adopted
23 July 1998, DSR 1998:V, p. 2031
EC – Sardines Appellate Body Report, European Communities – Trade Description of
Sardines, WT/DS231/AB/R, adopted 23 October 2002, DSR 2002:VIII, p. 3359
EC – Seal Products Appellate Body Reports, European Communities – Measures Prohibiting the
Importation and Marketing of Seal Products, WT/DS400/AB/R /
WT/DS401/AB/R, adopted 18 June 2014, DSR 2014:I, p. 7
EC – Selected Customs
Matters
Appellate Body Report, European Communities – Selected Customs Matters,
WT/DS315/AB/R, adopted 11 December 2006, DSR 2006:IX, p. 3791
EC and certain member
States – Large Civil Aircraft
Appellate Body Report, European Communities and Certain Member States –
Measures Affecting Trade in Large Civil Aircraft, WT/DS316/AB/R, adopted
1 June 2011, DSR 2011:I, p. 7
EC and certain member
States – Large Civil Aircraft
(Article 21.5 – US)
Appellate Body Report, European Communities and Certain Member States –
Measures Affecting Trade in Large Civil Aircraft – Recourse to Article 21.5 of
the DSU by the United States, WT/DS316/AB/RW and Add.1, adopted
28 May 2018
Guatemala – Cement I Appellate Body Report, Guatemala – Anti-Dumping Investigation Regarding
Portland Cement from Mexico, WT/DS60/AB/R, adopted 25 November 1998,
DSR 1998:IX, p. 3767
India – Patents (US) Appellate Body Report, India – Patent Protection for Pharmaceutical and
Agricultural Chemical Products, WT/DS50/AB/R, adopted 16 January 1998,
DSR 1998:I, p. 9
Japan – Apples Appellate Body Report, Japan – Measures Affecting the Importation of Apples,
WT/DS245/AB/R, adopted 10 December 2003, DSR 2003:IX, p. 4391
Korea – Alcoholic Beverages Appellate Body Report, Korea – Taxes on Alcoholic Beverages, WT/DS75/AB/R,
WT/DS84/AB/R, adopted 17 February 1999, DSR 1999:I, p. 3
Korea – Dairy Appellate Body Report, Korea – Definitive Safeguard Measure on Imports of
Certain Dairy Products, WT/DS98/AB/R, adopted 12 January 2000,
DSR 2000:I, p. 3
Korea – Pneumatic Valves
(Japan)
Panel Report, Korea – Anti-Dumping Duties on Pneumatic Valves from Japan,
WT/DS504/R and Add.1, circulated to WTO Members 12 April 2018
Mexico – Corn Syrup
(Article 21.5 – US)
Appellate Body Report, Mexico – Anti-Dumping Investigation of High Fructose
Corn Syrup (HFCS) from the United States – Recourse to Article 21.5 of the
DSU by the United States, WT/DS132/AB/RW, adopted 21 November 2001,
DSR 2001:XIII, p. 6675
Peru – Agricultural Products Appellate Body Report, Peru – Additional Duty on Imports of Certain
Agricultural Products, WT/DS457/AB/R and Add.1, adopted 31 July 2015,
DSR 2015:VI, p. 3403
Russia – Commercial
Vehicles
Appellate Body Report, Russia – Anti-Dumping Duties on Light Commercial
Vehicles from Germany and Italy, WT/DS479/AB/R and Add.1, adopted
9 April 2018

Short Title Full Case Title and Citation
Russia – Commercial
Vehicles
Panel Report, Russia – Anti-Dumping Duties on Light Commercial Vehicles
from Germany and Italy, WT/DS479/R and Add.1, adopted 9 April 2018, as
modified by Appellate Body Report WT/DS479/AB/R
Russia – Pigs (EU) Appellate Body Report, Russian Federation – Measures on the Importation of
Live Pigs, Pork and Other Pig Products from the European Union,
WT/DS475/AB/R and Add.1, adopted 21 March 2017, DSR 2017:I, p. 207
Thailand – H-Beams Appellate Body Report, Thailand – Anti-Dumping Duties on Angles, Shapes and
Sections of Iron or Non-Alloy Steel and H-Beams from Poland,
WT/DS122/AB/R, adopted 5 April 2001, DSR 2001:VII, p. 2701
Thailand – H-Beams Panel Report, Thailand – Anti-Dumping Duties on Angles, Shapes and Sections
of Iron or Non-Alloy Steel and H-Beams from Poland, WT/DS122/R, adopted
5 April 2001, as modified by Appellate Body Report WT/DS122/AB/R,
DSR 2001:VII, p. 2741
US – 1916 Act Appellate Body Report, United States – Anti-Dumping Act of 1916,
WT/DS136/AB/R, WT/DS162/AB/R, adopted 26 September 2000, DSR 2000:X,
p. 4793
US – Anti-Dumping and
Countervailing Duties (China)
Appellate Body Report, United States – Definitive Anti-Dumping and
Countervailing Duties on Certain Products from China, WT/DS379/AB/R,
adopted 25 March 2011, DSR 2011:V, p. 2869
US – Anti-Dumping
Methodologies (China)
Appellate Body Report, United States – Certain Methodologies and Their
Application to Anti-Dumping Proceedings Involving China, WT/DS471/AB/R
and Add.1, adopted 22 May 2017, DSR 2017:III, p. 1423
US – Carbon Steel Appellate Body Report, United States – Countervailing Duties on Certain
Corrosion-Resistant Carbon Steel Flat Products from Germany,
WT/DS213/AB/R and Corr.1, adopted 19 December 2002, DSR 2002:IX,
p. 3779
US – Carbon Steel (India) Appellate Body Report, United States – Countervailing Measures on Certain
Hot-Rolled Carbon Steel Flat Products from India, WT/DS436/AB/R, adopted
19 December 2014, DSR 2014:V, p. 1727
US – Continued Zeroing Appellate Body Report, United States – Continued Existence and Application of
Zeroing Methodology, WT/DS350/AB/R, adopted 19 February 2009,
DSR 2009:III, p. 1291
US – COOL Appellate Body Reports, United States – Certain Country of Origin Labelling
(COOL) Requirements, WT/DS384/AB/R / WT/DS386/AB/R, adopted
23 July 2012, DSR 2012:V, p. 2449
US – Countervailing and
Anti-Dumping Measures
(China)
Appellate Body Report, United States – Countervailing and Anti-Dumping
Measures on Certain Products from China, WT/DS449/AB/R and Corr.1,
adopted 22 July 2014, DSR 2014:VIII, p. 3027
US – Countervailing
Measures (China)
Appellate Body Report, United States – Countervailing Duty Measures on
Certain Products from China, WT/DS437/AB/R, adopted 16 January 2015,
DSR 2015:I, p. 7
US – Gambling Appellate Body Report, United States – Measures Affecting the Cross-Border
Supply of Gambling and Betting Services, WT/DS285/AB/R, adopted
20 April 2005, DSR 2005:XII, p. 5663 (and Corr.1, DSR 2006:XII, p. 5475)
US – Gasoline Appellate Body Report, United States – Standards for Reformulated and
Conventional Gasoline, WT/DS2/AB/R, adopted 20 May 1996, DSR 1996:I, p. 3
US – Hot-Rolled Steel Appellate Body Report, United States – Anti-Dumping Measures on Certain
Hot-Rolled Steel Products from Japan, WT/DS184/AB/R, adopted
23 August 2001, DSR 2001:X, p. 4697

Short Title Full Case Title and Citation
US – Lamb Appellate Body Report, United States – Safeguard Measures on Imports of
Fresh, Chilled or Frozen Lamb Meat from New Zealand and Australia,
WT/DS177/AB/R, WT/DS178/AB/R, adopted 16 May 2001, DSR 2001:IX,
p. 4051
US – Large Civil Aircraft
(2nd complaint)
Appellate Body Report, United States – Measures Affecting Trade in Large Civil
Aircraft (Second Complaint), WT/DS353/AB/R, adopted 23 March 2012,
DSR 2012:I, p. 7
US – Oil Country Tubular
Goods Sunset Reviews
Appellate Body Report, United States – Sunset Reviews of Anti-Dumping
Measures on Oil Country Tubular Goods from Argentina, WT/DS268/AB/R,
adopted 17 December 2004, DSR 2004:VII, p. 3257
US – Section 211
Appropriations Act
Appellate Body Report, United States – Section 211 Omnibus Appropriations
Act of 1998, WT/DS176/AB/R, adopted 1 February 2002, DSR 2002:II, p. 589
US – Shrimp Appellate Body Report, United States – Import Prohibition of Certain Shrimp
and Shrimp Products, WT/DS58/AB/R, adopted 6 November 1998,
DSR 1998:VII, p. 2755
US – Softwood Lumber VI
(Article 21.5 – Canada)
Appellate Body Report, United States – Investigation of the International Trade
Commission in Softwood Lumber from Canada – Recourse to Article 21.5 of
the DSU by Canada, WT/DS277/AB/RW, adopted 9 May 2006, and Corr.1,
DSR 2006:XI, p. 4865
US – Steel Safeguards Appellate Body Report, United States – Definitive Safeguard Measures on
Imports of Certain Steel Products, WT/DS248/AB/R, WT/DS249/AB/R,
WT/DS251/AB/R, WT/DS252/AB/R, WT/DS253/AB/R, WT/DS254/AB/R,
WT/DS258/AB/R, WT/DS259/AB/R, adopted 10 December 2003,
DSR 2003:VII, p. 3117
US – Tax Incentives Appellate Body Report, United States – Conditional Tax Incentives for Large
Civil Aircraft, WT/DS487/AB/R and Add.1, adopted 22 September 2017,
DSR 2017:V, p. 2199
US – Tyres (China) Appellate Body Report, United States – Measures Affecting Imports of Certain
Passenger Vehicle and Light Truck Tyres from China, WT/DS399/AB/R,
adopted 5 October 2011, DSR 2011:IX, p. 4811
US – Upland Cotton
(Article 21.5 – Brazil)
Appellate Body Report, United States – Subsidies on Upland Cotton – Recourse
to Article 21.5 of the DSU by Brazil, WT/DS267/AB/RW, adopted
20 June 2008, DSR 2008:III, p. 809
US – Washing Machines Appellate Body Report, United States – Anti-Dumping and Countervailing
Measures on Large Residential Washers from Korea, WT/DS464/AB/R and
Add.1, adopted 26 September 2016, DSR 2016:V, p. 2275
US – Wheat Gluten Appellate Body Report, United States – Definitive Safeguard Measures on
Imports of Wheat Gluten from the European Communities, WT/DS166/AB/R,
adopted 19 January 2001, DSR 2001:II, p. 717
US – Zeroing (EC)
(Article 21.5 – EC)
Appellate Body Report, United States – Laws, Regulations and Methodology for
Calculating Dumping Margins ("Zeroing") – Recourse to Article 21.5 of the DSU
by the European Communities, WT/DS294/AB/RW and Corr.1, adopted
11 June 2009, DSR 2009:VII, p. 2911
US – Zeroing (Japan)
(Article 21.5 – Japan)
Appellate Body Report, United States – Measures Relating to Zeroing and
Sunset Reviews – Recourse to Article 21.5 of the DSU by Japan,
WT/DS322/AB/RW, adopted 31 August 2009, DSR 2009:VIII, p. 3441

APPELLATE BODY

Korea – Anti-Dumping Duties on
Pneumatic Valves from Japan

Japan, Appellant/Appellee
Republic of Korea, Other Appellant/Appellee

Brazil, Third Participant
Canada, Third Participant
China, Third Participant
Ecuador, Third Participant
European Union, Third Participant
Norway, Third Participant
Singapore, Third Participant
Turkey, Third Participant
United States, Third Participant
Viet Nam, Third Participant
AB-2018-3

Appellate Body Division:

Bhatia, Presiding Member
Graham, Member
Servansing, Member

1 INTRODUCTION
1.1. Japan and the Republic of Korea (Korea) each appeal certain issues of law and legal
interpretations developed in the Panel Report, Korea – Anti-Dumping Duties on Pneumatic Valves
from Japan1 (Panel Report).
1.2. This dispute concerns the definitive anti-dumping duties imposed by Korea on imports of valves
for pneumatic transmissions (pneumatic valves) originating from Japan, following the investigation
conducted by the Korea Trade Commission (KTC) and the KTC's Office of Trade Investigation (OTI).2
The KTC initiated the investigation and published the notice of initiation on 21 February 2014 based
on an application filed by two producers of pneumatic valves in Korea.3 On 19 August 2015, on the
basis of the KTC's Final Resolution 4, the Minister of St rategy and Finance ( MOSF) imposed
anti-dumping duties on the imports of pneumatic valves from Japan through Decree No. 498 for five
years at the following rates: 11.66% for SMC Corporation (SMC) and exporters of its products, and
22.77% for CKD Corporation (CKD), Toyooki Kogyo Co., Ltd., and exporters of their products, as
well as other suppliers from Japan.5
1.3. The Panel was established on 4 July 2016 to consider the complaint by Japan with respect to
the consistency of the anti -dumping measures imposing the above duties (the measure at issue)
with the Agreement on Implementation of Article VI of the General Agreement on Tariffs and
Trade 1994 (Anti -Dumping Agreement) and the General Agreement on Tariffs and Trade 1994
(GATT 1994).6 After consultation with the parties, on 15 November 2016, the Panel adopted its

1 WT/DS504/R, 12 April 2018.
2 Panel Report, paras. 2.1-2.5.
3 Panel Report, para. 2.2. The applicants were TPC Mechatronics Corporation (TPC) and KCC Co., Ltd.
(KCC). (Ibid.)
4 KTC, Resolution of Final Determination on Dumping and Injury to Domestic Industry of Valves for
Pneumatic Transmissions from Japan, 20 January 2015 (KTC's Final Resolution) (Panel Exhibits JPN-4b (public
version) and KOR-1b (BCI)). In this Report, Panel exhibit numbers that are followed by the letter "b" refer to
the English version of the relevant document. The KTC issued its Final Resolution on the basis of OTI, Final
Report on Dumping and Injury to Domestic Industry of Valves for Pneumatic Transmissions Imported from
Japan, 20 January 2015 (OTI's Final Report) (Panel Exhibits JPN-5b (public version) and KOR-2b (BCI)).
5 Panel Report, para. 2.5 (referring to MOSF, Decree No. 498, Regulation Concerning the Imposition of
Anti-Dumping Duties on Valves for Pneumatic Transmissions originating from Japan, 19 August 2015 (MOSF's
Decree No. 498) (Panel Exhibit JPN-6b); MOSF, Public Announcement No. 2015-156, Decision to Apply
Anti-Dumping Duties on the Pneumatic Transmissions Valves from Japan, 19 August 2015 (MOSF's Public
Announcement) (Panel Exhibit KOR-3b (BCI))).
6 Panel Report, paras. 1.3-1.4; Request for the Establishment of a Panel by Japan, WT/DS504/2
(Japan's panel request).

working procedures, additional working procedures concerning business confidential information
(BCI), and timetable.7
1.4. In the Request for the Establishment of a Panel by Japan (Japan's panel request), Japan
requested the Panel to find that the measure at issue is inconsistent with Korea's obligations under
Articles 3.1 and 3.2, Articles 3.1 and 3.4, Articles 3.1 and 3.5, Articles 3.1 and 4.1, Article 6.5,
Article 6.5.1, Article 6.9, Article 12.2, and Article 12.2.2 of the Anti -Dumping Agreement .8 As a
consequence of these inconsistencies, Japan also claimed that Korea acted inconsistently with
Article 1 of the Anti-Dumping Agreement and Article VI of the GATT 1994.9
1.5. On 24 November 2016, Korea filed a request for the Panel to issue a preliminary ruling that
Japan's claims under Articles 3.1, 3.2, 3.4, 3.5, and 4.1 of the Anti -Dumping Agreement were
outside the Panel's terms of reference because Japan's panel request fa iled to "provide a brief
summary of the legal basis of the complaint sufficient to present the problem clearly", as required
by Article 6.2 of the Understanding on Rules and Procedures Governing the Settlement of Disputes
(DSU).10 At the invitation of the P anel, Japan submitted a written response to Korea's request on
16 December 2016. Korea responded to Japan's views in its first written submission. The
European Union and the United States also provided their views on Korea's request in their
respective third party submissions.11 On 7 July 2017, the Panel informed the parties that, in view of
the circumstances of the case and the extraordinary scope of Korea's request, which involved seven
of the 13 claims raised by Japan in this dispute, the Panel had decided not to issue a separate ruling
on the matter of the sufficiency of Japan's panel request under Article 6.2 of the DSU, indicating that
it would instead address the matter in the Panel Report.12
1.6. In the Panel Report, circulated to Members of the World Trad e Organization (WTO)
on 12 April 2018, the Panel found that:
a. the following claims in Japan's panel request failed to provide a brief summary of the legal
basis of the complaint sufficient to present the problem clearly as required under
Article 6.2 of the DSU and are therefore not within the Panel's terms of reference:13
i. Japan's claim under Articles 3.1 and 4.1 of the Anti -Dumping Agreement concerning
the definition of the domestic industry14;
ii. Japan's claim under Articles 3.1 and 3.2 of the Anti -Dumping Agreement concerning
Korea's analysis of an increase in the volume of the dumped imports15;
iii. Japan's claim under Articles 3.1 and 3.2 of the Anti -Dumping Agreement concerning
the consideration of the effect of the dumped imports on prices16;
iv. Japan's claim under Articles 3.1 and 3.4 of the Anti -Dumping Agreement concerning
the impact of the dumped imports on the state of the domestic industry, with the
exception of the allegations that the KTC and the OTI (Korean investigating authorities)
failed to evaluate two of the specific factors listed in Article 3.4, namely the ability to
raise capital or investments, and the magnitude of the margin of dumping17;
v. Japan's claim under Articles 3.1 and 3.5 of the Anti -Dumping Agreement concerning
the alleged failure by the Korean investigating authorities to consider adequately all
known factors other than the dumped imports that were injuring the domestic industry

7 Panel Report, para. 1.7. The Panel revised its timetable, after consulting the parties, on 21 June and
20 July 2017. (Ibid.)
8 Panel Report, para. 3.1. See also Japan's panel request.
9 Panel Report, para. 3.1.
10 Panel Report, para. 1.12.
11 Panel Report, para. 1.13.
12 Panel Report, para. 1.14.
13 Panel Report, para. 8.1.
14 Panel Report, paras. 7.67 and 8.1.a.
15 Panel Report, paras. 7.94 and 8.1.b.
16 Panel Report, paras. 7.131 and 8.1.c.
17 Panel Report, paras. 7.175 and 8.1.d.

at the same time, with the exception of the allegations concerning whether the Korean
investigating authorities considered certain known factors in isolation and dismissed
them without an adequate examination18;
vi. Japan's claim under Article 6.9 of the Anti-Dumping Agreement concerning the alleged
failure by the Korean investigating authorities to inform interested parties of essential
facts that formed the basis for the decision to impose definitive anti -dumping
measures19;
vii. Japan's claims under Articles 12.2 and 12.2.2 of the Anti -Dumping Agreement
concerning the alleged failure by the Korean investigating autho rities to give proper
public notice of their final determination20; and
viii. Japan's consequential claim under Article VI of the GATT 199421; and
b. the following claims in Japan's panel request provided a brief summary of the legal basis
of the complaint sufficient to present the problem clearly pursuant to Article 6.2 of the
DSU and are therefore properly within the Panel's terms of reference:22
i. Japan's claim under Articles 3.1 and 3.4 of the Anti -Dumping Agreement concerning
the alleged failure of the Korean investigating authorities to evaluate the ability to
raise capital or investments, and the magnitude of the margin of dumping under
Article 3.423;
ii. Japan's claim under Articles 3.1 and 3.5 of the Anti -Dumping Agreement that the
Korean investigating authorities' demonstration of causation lacks a foundation in its
analyses of volume of dumped imports, effects of imports on prices, and the impact of
those imports on the dome stic industry, irrespectively and independently of whether
the Korean investigating authorities' analyses are found to be inconsistent with
Articles 3.1, 3.2, and 3.4 of the Anti-Dumping Agreement24;
iii. Japan's claim under Articles 3.1 and 3.5 of the Anti -Dumping Agreement concerning
the alleged failure by the Korean investigating authorities to demonstrate any causal
relationship between the dumped imports and the injury to the domestic industry25;
iv. Japan's claim under Articles 3.1 and 3.5 of the Anti -Dumping Agreement concerning
the alleged failure of the Korean investigating authorities to examine certain known
factors adequately and their examination of those factors in isolation26;
v. Japan's claims under Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement concerning
the treatment of confidential information and the provision of non -confidential
summaries of information for which confidential treatment was sought by the
applicants27; and
vi. Japan's consequential claim under Article 1 of the Anti-Dumping Agreement.28

18 Panel Report, paras. 7.243 and 8.1.e.
19 Panel Report, paras. 7.517 and 8.1.f.
20 Panel Report, paras. 7.540 and 8.1.g.
21 Panel Report, paras. 7.549 and 8.1.h.
22 Panel Report, para. 8.2.
23 Panel Report, paras. 7.175 and 8.2.a.
24 Panel Report, paras. 7.226 and 8.2.b.
25 Panel Report, paras. 7.235 and 8.2.c.
26 Panel Report, paras. 7.243 and 8.2.d.
27 Panel Report, paras. 7.418 and 8.2.e.
28 Panel Report, paras. 7.549 and 8.2.f.

1.7. For the claims that the Panel found to be within its terms of reference, the Panel found that:
a. with respect to Japan's claim under Articles 3.1 and 3.4 of the Anti-Dumping Agreement:
i. Japan did not establish that the Korean investigating authorities acted inconsistently
with Articles 3.1 and 3.4 in their consideration of the two factors listed in Article 3.4.,
namely the ability to raise capital or investments and the magnitude of the margin of
dumping29;
b. with respect to Japan's claims under Articles 3.1 and 3.5 of the Anti-Dumping Agreement:
i. Japan did not establish that the Korean investigating authorities acted inconsistently
with Articles 3.1 and 3.5 with respect to their conclusion that the dumped imports,
through the effects of dumping, were causing injury to the domestic industry30;
ii. Japan did not establish that the Korean investigating authorities acted inconsistently
with Articles 3.1 and 3.5 with respect to their examination of known factors other than
the dumped imports that were injuring the domestic industry at the same time31; and
iii. Japan demonstrated that the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.5 in their causation analysis as a result of flaws in their analysis of
the effect of the dumped imports on prices in the domestic market32;
c. with respect to Japan's claim under Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement:
i. Japan demonstrated that the Korean investigating authorities acted inconsistently with
Article 6.5 with respect to their treatment of information provided by the applicants as
confidential without requiring that good cause be shown33; and
ii. Japan demonstrated that the Korean investigating authorities acted inconsistently with
Article 6.5.1 with respect to their failure to require that the submitting parties provide
a sufficient non -confidential summary of the information for which confidential
treatment was sought34; and
d. with respect to Japan's claim under Article 1 of the Anti-Dumping Agreement:
i. Japan demonstrated that the Korean investigating authorities acted inconsistently with
Article 1 as a consequence of and to the extent that they acted inconsistently with
Articles 3.1 and 3.5, and Articles 6.5 and 6.5.1, of the Anti-Dumping Agreement.35
1.8. In accordance with Article 19.1 of the DSU, and having found that Korea acted inconsistently
with certain provisions of the Anti -Dumping Agreement, the Panel recommended that Korea bring
its measure into conformity with its obligations under that Agreement.36
1.9. On 28 May 2018, Japan notified the Dispute Settlement Body (DSB), pursuant to Articles 16.4
and 17 of the DSU, of its intention to appeal certain issues of law covered in the Panel Report and
certain legal interpretations developed by the Panel, and filed a Notice of Appeal and an appellant's
submission37 pursuant to Rule 20 and Rule 21, respectively, of the Working Procedures for Appellate
Review38 (Working Procedures). On 4 June 2018, Korea notified the DSB, pursuant to Articles 16.4
and 17 of the DSU, of its intention to a ppeal certain issues of law covered in the Panel Report and

29 Panel Report, paras. 7.192 and 8.3.a.
30 Panel Report, paras. 7.361 and 8.3.b.
31 Panel Report, paras. 7.389 and 8.3.c.
32 Panel Report, paras. 7.349 and 8.4.a.
33 Panel Report, paras. 7.441, 7.451, and 8.4.b.
34 Panel Report, paras. 7.450-7.451 and 8.4.c.
35 Panel Report, paras. 7.552-7.553 and 8.4.d.
36 Panel Report, para. 8.6.
37 WT/DS504/5.
38 WT/AB/WP/6, 16 August 2010.

certain legal interpretations developed by the Panel, and filed a Notice of Other Appeal 39 and an
other appellant's submission, pursuant to Rule 23 of the Working Procedures.
1.10. On 30 May 2018, the Chair of the Appellate Body received a communication from the
European Union requesting the Division hearing this appeal to extend the deadline for the filing of
third participants' submissions to allow for sufficient time for third participants to consider and react
to the appellees' submissions. On 31 May 2018, on behalf of the Division hearing this appeal, the
Chair of the Appellate Body invited Korea, Japan, and other third participants in this dispute to
comment in writing on the co mmunication from the European Union.40 On 6 June 2018, the Chair,
on behalf of the Division hearing the appeal, issued a Procedural Ruling extend ing the deadline for
filing third participants' submissions and notifications under Rule 24(1) and (2) of the Wo rking
Procedures to 22 June 2018.41
1.11. On 15 June 2018, Japan and Korea each filed an appellee's submission. 42 On 22 June 2018,
the European Union and the United States each filed a third participant's submission.43 On the same
day, Canada and Singapore each not ified its intention to appear at the oral hearing as a third
participant.44 On the same day, Norway, Turkey, and Viet Nam each notified its intention to reserve
its right to attend the oral hearing, while Brazil, China, and Ecuador each notified the same on
25 June 2018.45
1.12. By letter dated 27 July 2018, the Chair of the Appellate Body notified the Chair of the DSB
that the Appellate Body would not be able to circulate its Report within the 60-day period pursuant
to Article 17.5 of the DSU, or within the 90 -day period pursuant to the same provision, for the
reasons mentioned therein. 46 For the reasons explained in the letter, work on this appeal could
gather pace only in January 2019. On 9 July 2019, the Chair of the Appellate Body notified the Chair
of the DSB that the Appellate Body Report in these proceedings would be circulated to WTO Members
no later than 10 September 2019.47
1.13. By letter dated 28 September 2018, the participants and third participants were informed that
the Chair of the Appellate Body had notified the Chair of the DSB that Mr Shree Baboo Chekitan
Servansing had been authorized by the Appellate Body, pursuant to Rule 15 of the Working
Procedures, to complete the disposition of this appeal, although his term of office would expire before
the completion of these appellate proceedings.
1.14. On 4 March 2019, the Presiding Member of the Division hearing this appeal received a joint
communication from Japan and Korea requesting the Division to adopt additional working procedures
for the protection of BCI, pursuant to Article 16(1) of the Working Procedures. On 5 March 2019,
the Presiding Member of the Division invited the third participants to provide comments on the joint
communication by the participants. No responses were rec eived from the third participants. On
26 March 2019, the Division issued a Procedural Ruling on the protection of the information marked
by the participants as BCI in their submissions to the Appellate Body and the information designated
by the Panel as BCI in its Report and on the Panel record.48
1.15. The hearing in this appeal was held on 3-4 April 2019. The participants and two of the third
participants ( the European Union and Norway) made oral statements. During the hearing, the

39 WT/DS504/6.
40 The Chair received a letter from each participant indicating that they did not have specific comments
on this matter.
41 Contained in Annex D of the Addendum to this Report (WT/DS504/AB/R/Add.1).
42 Pursuant to Rules 22 and 23(4) of the Working Procedures.
43 Pursuant to Rule 24(1) of the Working Procedures.
44 Pursuant to Rule 24(2) of the Working Procedures.
45 Pursuant to Rule 24(4) of the Working Procedures.
46 WT/DS504/7. The Chair of the Appellate Body explained that, in view of the backlog of appeals
pending, and the overlap in the composition of all divisions resulting in part from the reduced number of
Appellate Body Members, it would not be possible for the Division to focus on the consideration of this appeal
for some time, that is, schedule internal meetings, fully staff it, and schedule the hearing. (Ibid.)
47 WT/DS504/8.
48 Contained in Annex D of the Addendum to this Report (WT/DS504/AB/R/Add.1).

participants and the third par ticipants also responded to questions posed by the Members of the
Division hearing this appeal.
2 ARGUMENTS OF THE PARTICIPANTS
2.1. The claims and arguments of the participants are reflected in the executive summaries of their
written submissions provided to th e Appellate Body.49 The Notice of Appeal and the executive
summaries of the participants' claims and arguments are contained in Annexes A and B of the
Addendum to this Report, WT/DS504/AB/R/Add.1.
3 ARGUMENTS OF THE THIRD PARTICIPANTS
3.1. The arguments of the thi rd participants that filed a written submission (the European Union
and the United States) are reflected in the executive summaries of their written submissions
provided to the Appellate Body50 and are contained in Annex C of the Addendum to this Report,

4 ISSUES RAISED
4.1. The following issues are raised in this appeal:
a. with respect to Japan's claim under Articles 3.1 and 4.1 of the Anti -Dumping Agreement
(raised by Japan):
i. whether the Panel erred in finding that Japan's panel request, as it relates to the claim
under Articles 3.1 and 4.1 of the Anti -Dumping Agreement concerning the Korean
investigating authorities' definition of the domestic industry (claim 7), failed to comply
with the requirements of Article 6.2 of the DSU and, consequently, in finding that this
claim was outside the Panel's terms of reference; and
ii. if the Appellate Body were to find that the Panel erred in finding that Japan's claim 7
was outside its terms of reference, whether the Appellate Body can complete the legal
analysis and find that the Korean investigating authorities' definition of the domestic
industry was inconsistent with Articles 3.1 and 4.1 of the Anti-Dumping Agreement;
b. with respect to Japan's claims under Article 3 of the Anti-Dumping Agreement:
i. whether the Panel erred in finding that Japan's panel request, as it relates to the
following claims, failed to comply with the requirements of Article 6.2 of the DSU and,
consequently, in finding that these claims were outside the Panel's terms of reference
(raised by Japan):
• the claim under Articles 3.1 and 3.2 of the Anti -Dumping Agreement concerning
the Korean investigating authorities' consideration of the volume of the dumped
imports (claim 1);
• the claim under Articles 3.1 and 3.2 of the Anti -Dumping Agreement concerning
the Korean investigating authorities' consideration of the effects of the dumped
imports on price (claim 2); and
• the claim under Articles 3.1 and 3.4 of the Anti -Dumping Agreement concerning
the Korean investigating authorities' examination of the impact of the dumped
imports on the domestic industry (part of claim 3);

49 Pursuant to the Appellate Body's communication on "Executive Summaries of Written Submissions in
Appellate Proceedings" and "Guidelines in Respect of Executive Summaries of Written Submissions in
Appellate Proceedings" (WT/AB/23, 11 March 2015).
50 Pursuant to the Appellate Body's communication on "Executive Summaries of Written Submissions in
Appellate Proceedings" and "Guidelines in Respect of Executive Summaries of Written Submissions in
Appellate Proceedings" (WT/AB/23, 11 March 2015).

ii. whether the Panel erred in finding that Japan's panel request , as it relates to the
following claims, complied with the requirements of Article 6.2 of the DSU and,
consequently, in finding that these claims were within its terms of reference (raised
by Korea):
• the claim under Articles 3.1 and 3.5 of the Anti -Dumping Agreement that the
Korean investigating authorities failed to properly establish a causal link between
the dumped imports and the alleged injury (claim 4);
• the claim under Articles 3.1 and 3.5 of the Anti-Dumping Agreement concerning
the Korean investigating authorities' non-attribution analysis (part of claim 5); and
• the claim under Articles 3.1 and 3.5 of the Anti -Dumping Agreement that the
Korean investigating authorities' causation determinatio n was undermined by its
flawed price effects and volume analyses under Article 3.2, and by its flawed
impact analysis under Article 3.4, "irrespective and independent" of whether these
analyses were found to be inconsistent with Articles 3.2 and 3.4 (claim 6);
iii. whether the Panel erred in finding that Japan failed to establish that the Korean
investigating authorities acted inconsistently with Articles 3.1 and 3.4 of the
Anti-Dumping Agreement in their evaluation of the magnitude of the margin of
dumping for purposes of examining the impact of the dumped imports on the domestic
industry (raised by Japan);
iv. whether the Panel erred in its interpretation or application of Articles 3.1 and 3.5 of
the Anti-Dumping Agreement in resolving Japan's claim 6 (raised by the participants);
v. whether the Panel erred in its interpretation or application of Articles 3.1 and 3.5 of
the Anti-Dumping Agreement in resolving Japan's claim 4 (raised by Japan);
vi. if the Appellate Body were to find that the Panel erred in finding that Japan's claim 1
was outside its terms of reference, whether the Appellate Body can complete the legal
analysis and find that the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.2 of the Anti -Dumping Agreement in their consideration of the
volume of the dumped imports in the anti -dumping investigation at issue (raised by
Japan);
vii. if the Appellate Body were to find that the Panel erred in finding that Japan's claim 2
was outside its terms of reference, whether the Appellate Body can complete the legal
analysis and find that the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.2 of the Anti -Dumping Agreement in their consideration of the
effects of the d umped imports on prices in the anti -dumping investigation at issue
(raised by Japan); and
viii. if the Appellate Body were to find that the Panel erred in finding that part of Japan's
claim 3 was outside its terms of reference, whether the Appellate Body can complete
the legal analysis and find that the Korean investigating authorities acted
inconsistently with Articles 3.1 and 3.4 of the Anti -Dumping Agreement in their
determination of the impact of the dumped imports on the domestic industry in the
anti-dumping investigation at issue (raised by Japan);
c. with respect to Japan's claims under Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement
(raised by Korea):
i. whether the Panel erred in finding that Japan's panel request, as it relates to the claims
under, respectively, Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement concerning
the confidential treatment of information (claims 8 and 9), complied with the
requirements of Article 6.2 of the DSU and, consequently, were within its terms of
reference;

ii. whether the Panel erred in its interpretation or application of Article 6.5 of the
Anti-Dumping Agreement in finding that the Korean investigating authorities acted
inconsistently with this provision by treating certain information as confidential without
"good cause" having been shown; and
iii. whether the Panel erred in its application of Article 6.5.1 of the Anti -Dumping
Agreement in finding that the Korean investigating authorities acted inconsistently with
this provision by failing to require that the submitting partie s provide a sufficient
non-confidential summary of the information for which confidential treatment was
sought; and
d. with respect to Japan's claim under Article 6.9 of the Anti-Dumping Agreement (raised by
Japan):
i. whether the Panel erred in finding that Japan's panel request, as it relates to the claim
under Article 6.9 of the Anti -Dumping Agreement concerning the disclosure of
essential facts (claim 10), failed to comply with the requirements of Article 6.2 of the
DSU and, consequently, in finding that this claim was outside the Panel's terms of
reference; and
ii. if the Appellate Body were to find that the Panel erred in finding that Japan's claim 10
was outside its terms of reference, whether the Appellate Body can complete the legal
analysis and find that Korea acted inconsistently with Article 6.9 of the Anti-Dumping
Agreement because the Korean inve stigating authorities failed to disclose the
"essential facts" under consideration before the final determination was made.
5 ANALYSIS OF THE APPELLATE BODY
5.1. As noted in paragraph 1.5 above, the Panel did not issue a separate ruling on Korea's challenge
of the sufficiency of Japan's panel request with respect to all of the claims contained therein 51, but
instead addressed the issues regarding the sufficiency of Japan's panel request in its final Report.
5.2. In its final Report, the Panel began by articulating its overarching understanding of the relevant
legal standard under Article 6.2 of the DSU.52 The Panel then addressed each of the claims raised in
Japan's panel request, starting with Japan's claim regarding the Korean investigating authorities'
definition of the domestic industry, followed by, inter alia , the claims concerning the Korean
investigating authorities' injury determination, treatment of confidential information, and disclosure
of essential facts.53 For each claim, the Panel began by determining whether it fell within its terms
of reference in light of the legal standard under Article 6.2 of the DSU. For those claims found to be
within its terms of reference, the Panel proceeded to examine the merits of each of them pursuant
to the relevant provisions of the Anti-Dumping Agreement. In our analysis below, we largely follow
the same order, beg inning with a review of the legal standard under Article 6.2 and our
understanding of the Panel's articulation of this standard. We then turn to the appeal of the Panel's
findings on Japan's claim regarding the Korean investigating authorities' definition of the domestic
industry, followed by the appeals of the Panel's findings on Japan's claims regarding the Korean
investigating authorities' determination of injury, treatment of confidential information, and
disclosure of essential facts.
5.1 Overall considerations regarding the legal standard under Article 6.2 of the DSU
5.1.1 The legal standard under Article 6.2 of the DSU
5.3. Article 6.2 of the DSU provides, in relevant part:

52 Panel Report, paras. 7.18-7.27.
53 The Panel's findings on Japan's remaining claims, brought under Articles 12.2 and 12.2.2 of the
Anti-Dumping Agreement, are not subject to appeal.

The request for the establishment of a panel shall be made in writing. It shall indicate
whether consultations were held, identify the specific measures at issue and provide a
brief summary of the legal basis of the complaint sufficient to present the problem
clearly.
5.4. The requirements under Article 6.2 of the DSU are " central to the establishmen t of the
jurisdiction of a panel ".54 A panel request governs a panel's terms of reference and delimits the
scope of the panel's jurisdiction. 55 In addition, by establishing and defining the jurisdiction of the
panel, "the panel request also fulfils a due process objective" by providing the respondent and third
parties with notice regarding the nature of the complainant's case and enabling them to respond
accordingly.56
5.5. In assessing whether a panel request is sufficiently precise to meet the requirements of
Article 6.2 of the DSU, panels must "scrutinize carefully the panel request, read as a whole, and on
the basis of the language used". 57 Whether a panel request complies with the requirements of
Article 6.2 of the DSU must therefore be determined on the face of the panel request 58, on a
case-by-case basis.59 Defects in the request for the establishment of a panel cannot be cured in the
subsequent submissions of the parties during the panel proceedings. However, "in considering the
sufficiency of a panel request, submissions and statements made during the course of the panel
proceedings, in particular the first written submission of the complaining party, may be consulted in
order to confirm the meaning of the words used in the panel request."60
5.6. The present dispute concerns whether Japan's panel request has identified the legal basis of
the complaint with sufficient clarity, and does not pertain to the identification of "the specific
measures at issue". At the centre of the dispute is the question whether Japan's panel request
"provide[d] a brief summary of the legal basis of the complaint sufficient to present the problem
clearly" within the meaning of the latter part of the second sentence of Article 6.2 of the DSU .
Pursuant to this requirement, while the summary of the legal basis may be "brief", the degree of
brevity that is permissible under Article 6.2 is a function of its clarity in presenting the problem. The
Appellate Body has found that, to meet this requirement, a panel request must "plainly connect the
challenged measure(s) with the provision(s) of the covered agreements claimed to have been
infringed".61 The identification of the treaty provisi on claimed to have been violated is "always
necessary" and a "minimum prerequisite". 62 At the same time, depending on the particular
circumstances of a case, the identification of the treaty provision alleged to have been breached
may not alone be sufficient to comply with the requirements of Article 6.2. For example, "to the
extent that a provision contains not one single, distinct obligation, but rather multiple obligations, a
panel request might need to specify which of the obligations contain ed in the provision is being

54 Appellate Body Report, US – Countervailing Measures (China), para. 4.6.
55 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.12. See also
Appellate Body Reports, EC and certain member States – Large Civil Aircraft, para. 640; US – Countervailing
Measures (China), para. 4.6; US – Countervailing and Anti-Dumping Measures (China), para. 4.6.
56 Appellate Body Report, US – Countervailing and Anti-Dumping Measures (China), para. 4.7 (referring
to Appellate Body Reports, Brazil – Desiccated Coconut, p. 22, DSR 1997:I, p. 186; Chile – Price Band System,
57 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.13 (quoting
Appellate Body Report, EC – Fasteners (China), para. 562 (fn omitted)).
58 Appellate Body Reports, US – Carbon Steel, para. 127; China – HP-SSST (Japan) / China – HP-SSST
(EU), para. 5.13.
US – Countervailing and Anti-Dumping Measures (China), para. 4.17.
60 Appellate Body Report, US – Carbon Steel, para. 127 (referring to Appellate Body Report,
Thailand – H-Beams, para. 95). See also Appellate Body Reports, China – Raw Materials, para. 220;
China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.13.
61 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.15 (quoting
Appellate Body Reports, China – Raw Materials, para. 220; US – Countervailing and Anti-Dumping Measures
(China), para. 4.8, in turn quoting Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews,
para. 162). See also Appellate Body Report, US – Countervailing Measures (China), para. 4.9.
62 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.14 (quoting
Appellate Body Report, Korea – Dairy, para. 124, in turn referring to Appellate Body Reports,
Brazil – Desiccated Coconut, p. 22, DSR 1997:I, p. 186; EC – Bananas III, paras. 145 and 147; India – Patents
(US), paras. 89 and 92-93).

challenged."63 Thus, in light of the requirement to consider the sufficiency of a panel request on its
face and on a case -by-case basis, what is sufficient to "plainly connect " the measure with the
provision of the covered agree ments claimed to have been infringed will also depend on the
circumstances of each case. Such circumstances may include the nature of the measure at issue and
the manner in which it is described in the panel request, as well as the nature of the provision of the
covered agreements alleged to have been breached.64 In addition, a panel request need only provide
the "legal basis of the complaint", that is, the claims underlying this complaint and not the arguments
in support thereof.65
5.7. The Appellate Body has also on three occasions indicated that a brief summary of the legal
basis of the complaint required by Article 6.2 of the DSU "aims to explain succinctly how or why the
measure at issue is considered by the complaining Member to be violating the WTO obligatio n in
question".66 For example, in EC – Selected Customs Matters, the Appellate Body used the phrase
"how or why" in connection with the requirement that the summary of the legal basis "be sufficient
to present the problem clearly". 67 Subsequently, in China – Raw Materials , the Appellate Body
considered that the panel request in that dispute failed to explain succinctly how or why the measure
at issue is inconsistent with the WTO obligation in question because the panel request failed to
connect the different measures with the various obligations listed therein. 68 Thus, the use of the
phrase "how or why" in these cases does not imply a new and different legal standard for complying
with the requirements of Article 6.2 of the DSU. As described above, the applicab le legal standard,
which requires a "brief summary of the legal basis … sufficient to present the problem clearly",
entails the consideration of whether the panel request plainly connects the measure with the
provision of the covered agreements claimed to have been infringed. The sufficiency of a panel
request under this standard is to be assessed on a case-by-case basis.
5.8. In sum, the requirements under Article 6.2 of the DSU are central to the proper establishment
of the jurisdiction of a panel. A panel request governs a panel's terms of reference and delimits the
scope of the panel's jurisdiction. In addition, by establishing and defining the jurisdiction of the
panel, the panel request also fulfils a due process objective by providing the respondent and t hird
parties with notice regarding the nature of the complainant's case and by enabling them to respond
accordingly. Whether a panel request complies with the requirements of Article 6.2 of the DSU must
be determined on the face of the panel request, on a case-by-case basis. Defects in the request for
the establishment of a panel cannot be cured in the subsequent submissions of the parties during
the panel proceedings. However, in considering the sufficiency of a panel request, submissions and
statements ma de during the course of the panel proceedings, in particular the first written
submission of the complaining party, may be consulted in order to confirm the meaning of the words
used in the panel request.
5.9. In order to "provide a brief summary of the legal basis of the complaint sufficient to present
the problem clearly" pursuant to Article 6.2 of the DSU, a panel request must plainly connect the
measure(s) with the provision(s) of the covered agreements claimed to have been infringed. The
identification of the treaty provision claimed to have been violated by the respondent is "always
necessary" and a "minimum prerequisite"69, but may not be sufficient to meet the above requirement
of Article 6.2 depending on the particular circumstances of a case. Such circumstances include the

63 Appellate Body Report, US – Countervailing Measures (China), para. 4.9 (quoting Appellate Body
Reports, China – Raw Materials, para. 220, in turn referring to Appellate Body Reports, Korea – Dairy,
para. 124; EC – Fasteners (China), para. 598; US – Countervailing and Anti-Dumping Measures (China),
para. 4.8).
64 See Appellate Body Report, US – Countervailing Measures (China), para. 4.9.
65 See para. 5.31 below. See also Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST
66 Appellate Body Report, EC – Selected Customs Matters, para. 130. (emphasis original) See also
Appellate Body Reports, China – Raw Materials, para. 226; US – Countervailing Measures (China), para. 4.9.
67 Appellate Body Report, EC – Selected Customs Matters, para. 130.
68 Appellate Body Reports, China – Raw Materials, para. 266. In that dispute, the panel request listed 37
legal instruments as the measures at issue and alleged them to be inconsistent with 13 provisions of the
covered agreements. The Appellate Body noted that it was "not clear which allegations of error pertain to
which particular measure or set of measures identified in the panel requests". (Ibid., paras. 226 and 229)
69 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.14 (quoting
Appellate Body Report, Korea – Dairy, para. 124, in turn referring to Appellate Body Reports,
Brazil – Desiccated Coconut, fn 21 at p. 22, DSR 1997:I, p. 186; EC – Bananas III, paras. 145 and 147;
India – Patents (US), paras. 89 and 92-93).

nature of the measure at issue and the manner in which it is described in the panel request, as well
as the nature of the provision of the covered agreements alleged to have been breached.
5.1.2 Whether the Panel erred in i ts articulation of the applicable legal standard under
Article 6.2 of the DSU
5.10. The Panel recalled that a panel request serves a dual function, because it: (i) "forms the basis
for a panel's terms of reference under Article 7.1 of the DSU"; and (ii) "informs other WTO Members
of the nature of the dispute, which in turn allows the respondent to prepare its defence and allows
other Members to assess whether they have an interest in the matter, for example, to decide whether
to participate as third parties". 70 The Panel noted that compliance with the requirements under
Article 6.2 must be demonstrated on the face of the panel request71, and that later submissions and
statements by the parties may only be considered to confirm the meaning of the words used in the
panel request and to assess whether the ability of the respondent to defend itself was prejudiced.72
With respect to the requirement in Article 6.2 to provide a brief summary of the legal basis of the
complaint sufficient to present the problem clearly, the P anel said that the "legal basis of the
complaint" refers to the "claims" made by the complaining party. 73 For this purpose, the Panel
distinguished between "claims" and "arguments" by noting that a panel request must identify the
claims put forward by the complainant but need not identify the complainant's arguments.74
5.11. Furthermore, the Panel indicated that "a panel request must plainly connect the challenged
measures with the provisions of the covered agreements claimed to have been infringed, so that the
responding party is aware of the basis for the alleged nullification or impairment of the complaining
party's benefits." 75 The Panel noted that the narrative of a panel request "functions to explain
succinctly how or why the measure at issue is considered by the complaining Member to be violating
the WTO obligations in question". 76 To the Panel, as a minimum requirement, a complainant must
list in the panel request the provisions of the covered agreements claimed to have been violated.
The Panel noted, however, that there are situations in which a "mere listing" of treaty provisions
does not satisfy the standards of clarity in the statement of the legal basis of the complaint required
by Article 6.2.77 The Panel further stated that whether the listing of a treaty provision allegedly
violated is sufficient to constitute a "brief summary of the legal basis of the complaint sufficient to
present the problem clearly" depends on the circumstances of each case, and in particular the extent
to which a mere reference to a treaty provision sheds light on the nature of the obligation at issue.78
5.12. In its articulation of the relevant legal standard under Article 6.2 of the DSU, the Panel rightly
noted the dual function of the panel request in establishing the terms of reference and fulfilling a
due process objective by providing notice to other Members of the nature of the dispute. The Panel
also rightly indicated that the consistency of the panel request is to be established on a case-by-case
basis, and that the panel request mu st connect the challenged measure with the provision of the
covered agreement claimed to have been infringed such that it provides a brief summary of the legal
basis of the complaint sufficient to present the problem clearly by, at a minimum, identifying t he
provision in question. With regard to the Panel's reference to the function of the panel request to

70 Panel Report, para. 7.19 (referring to Appellate Body Reports, Brazil – Desiccated Coconut, p. 22,
DSR 1997:I, p. 186; EC – Bananas III, para. 142; US – Carbon Steel, para. 126; US – Continued Zeroing,
71 Panel Report, para. 7.20.
72 Panel Report, para. 7.20 (referring to Appellate Body Reports, US – Carbon Steel, para. 127;
Australia – Apples, para. 418).
73 Panel Report, para. 7.21 (referring to Appellate Body Report, Guatemala – Cement I, para. 72).
74 Panel Report, para. 7.22 (referring to Appellate Body Reports, Korea – Dairy, para. 139;
EC – Bananas III, para. 141).
75 Panel Report, para. 7.24 (referring to Appellate Body Report, US – Oil Country Tubular Goods Sunset
Reviews, para. 162).
76 Panel Report, para. 7.24 (referring to Appellate Body Reports, EC – Selected Customs Matters,
para. 130; China – Raw Materials, para. 226; US – Countervailing and Anti-Dumping Measures (China),
para. 4.26). (emphasis original)
77 Panel Report, para. 7.26 (referring to Appellate Body Report, Korea – Dairy, para. 124). By way of
example, the Panel noted that this would be the case where the provisions listed in the panel request establish
not one single, distinct obligation, but rather multiple obligations. (Ibid.)
78 Panel Report, para. 7.27 (referring to Panel Reports, EC – Approval and Marketing of Biotech
Products, para. 7.47; Preliminary Ruling by the Panel on the Consistency of the Complaining Parties' Panel
Requests with Article 6.2 of the DSU, para. 79).

"explain succinctly how or why the measure at issue is considered … to be violating the WTO
obligations in question" 79, we reiterate our understanding set out in paragraph 5.7 above.
Specifically, the reference to the phrase "how or why" in certain past disputes does not indicate a
standard different from the requirement that a panel request include a "brief summary of the legal
basis … sufficient to present the problem clearly" within the meaning of Article 6.2 of the DSU.
5.13. The Panel went on to make certain observations regarding the relevance of the obligation
under Article 3.1 of the Anti -Dumping Agreement for purposes of assessing the sufficiency of the
panel request in this dispute. The Panel noted that, of the 13 claims set out in Japan's panel request,
7 relate to Korea's injury determination, each of which invokes Article 3.1 of the Anti -Dumping
Agreement together with another subparagraph of Article 3 or, in 1 claim, Article 4.1 of the
Anti-Dumping Agreement.80 For purposes of its findings under Article 6.2 of the DSU, the Panel
considered it useful to explain its understanding of the legal framework for injury determinations so
as to "provide the context for [its] consideration of whether the claims raised by Japan are properly
before the Panel".81 The Panel noted that the provisions of Article 3 of the Anti-Dumping Agreement
are interrelated in the sense that the required elements under Article 3 all contribute to the
explanation of the ultimat e determination of whether dumped imports are causing injury to the
domestic industry of the importing Member. 82 In this regard, the Panel indicated that Article 3.1
functions as a chapeau and informs the rest of Article 3, such that it is an "overarching provision"
that sets forth a Member's fundamental obligation with respect to the determination of injury, and
"informs the more detailed obligations in succeeding paragraphs ".83 However, the Panel indicated
that the principles set out in Article 3.1 "do not … establish independent obligations which can be
judged in the abstract, or in isolation and separately from the substantive requirements set out in
the remainder of Article 3".84
5.14. Noting that the requisite degree of specificity and clarity in a panel request must be examined
on a case-by-case basis85, the Panel indicated at the same time that, "merely to mention the first
part of Article 3.1, or use the language of that provision … in a panel request will not in itself normally
suffice to present a problem clearly with respect to an allegation of violation of the Anti-Dumping
Agreement."86 To the Panel, that would not, by itself, "explain how or why a complainant considers
the measure at issue to be inconsistent with a speci fic obligation under the Anti -Dumping
Agreement", or "be precise enough to serve the dual function of a panel request" to define the basis
for the Panel's terms of reference and to inform other WTO Members of the status of the dispute.87
Subsequently, in ap plying Article 6.2 of the DSU, the Panel relied, inter alia, on this reasoning in
determining that certain of Japan's claims were not within its terms of reference.88
5.15. However, w e observe that, in the panel request, none of Japan's claims is limited to
paraphrasing the language of Article 3.1 of the Anti-Dumping Agreement alone. Rather, Japan also
identifies, at a minimum, another paragraph of Article 3 or Article 4 alleged to have been breached.
Therefore, whether Japan's paraphrasing of Article 3.1, together with the remainder of the narrative

79 Panel Report, para. 7.24 (referring to Appellate Body Reports, EC – Selected Customs Matters,
para. 130; China – Raw Materials, para. 226; US – Countervailing and Anti-Dumping Measures (China),
para. 4.26). (emphasis original)
80 Panel Report, para. 7.28
81 Panel Report, para. 7.29.
82 Panel Report, para. 7.30 (referring to Panel Report, China – Cellulose Pulp, para. 7.10). The Panel
indicated that the reference to "positive evidence" in Article 3.1 refers to "the facts underpinning and justifying
the injury determination" and to "the quality of the evidence that an investigating authority may rely upon in
making a determination", and that the term "positive" suggests that the evidence should be "affirmative,
objective, verifiable, and credible". (Ibid., para. 7.32 (quoting Appellate Body Reports, US – Hot-Rolled Steel,
Panel Report, China – Cellulose Pulp, para. 7.12)) Further, the Panel found that the reference to an "objective
examination" in Article 3.1 relates to the investigative process itself, and requires that the process "conform to
the dictates of the basic principles of good faith and fundamental fairness" and be conducted "in an unbiased
manner, without favouring the interests of any interested party, or group of interested parties, in the
investigation". (Ibid., para. 7.32 (quoting Appellate Body Report, China – GOES, para. 126; referring to
Appellate Body Report, US – Hot-Rolled Steel, para. 193; Panel Report, China – Cellulose Pulp, para. 7.12))
83 Panel Report, para. 7.33 (quoting Appellate Body Report, Thailand – H-Beams, para. 106).
85 Panel Report, para. 7.34.
86 Panel Report, para. 7.35.
88 See Panel Report, paras. 7.64, 7.91, 7.129, and 7.173.

contained in the panel request, including Japan's reference to the other provision (s) concerned,
complies with the requirements of Article 6.2 should be assessed on a case-by-case basis, depending
on the relevant circumstances of each claim. Thus, the fact that the narrative of Japan's claims, as
set out in its panel request, paraphrases the language of Article 3.1, in and of itself, is not dispositive
of whether the panel request complies with Article 6.2 of the DSU.
5.16. We will proceed to determine whether the Panel erred in its application of the legal standard
under Article 6.2 for each of the claims under appeal in the respective sections below.
5.2 Domestic industry
5.17. The Panel found that Japan's claim 7, as listed in its panel request, which concerns the Korean
investigating authorities' definition of the domestic industry, d id not meet the requirements of
Article 6.2 of the DSU and, consequently, was not within its terms of reference. Japan appeals this
finding and requests the Appellate Body to find that this claim is within the Panel's terms of
reference. In addition, Japan requests the Appellate Body to complete the legal analysis and find
that the Korean investigating authorities acted inconsistently with Articles 3.1 and 4.1 of the
Anti-Dumping Agreement in defining the domestic industry in the anti -dumping investigation at
issue. Korea, for its part, requests the Appellate Body to uphold the Panel's finding under Article 6.2
of the DSU. Should the Appellate Body reverse the Panel's finding, Korea argues that the
Appellate Body cannot complete the legal analysis.
5.18. We will first assess whether the Panel erred in finding that J apan's claim concerning the
definition of the domestic industry did not comport with the requirements of Article 6.2 of the DSU.
If we reverse the Panel's findings under Article 6.2, and find that Japan's claim concerning the
definition of the domestic industry is within the Panel's terms of reference, we will proceed to
examine whether we can complete the legal analysis with respect to Japan's claim that the Korean
investigating authorities acted inconsistently with Articles 3.1 and 4.1 of the Anti-Dumping
Agreement.
5.2.1 Whether the Panel erred in finding that Japan's claim 7 concerning the definition of
the domestic industry was not within its terms of reference
5.19. Claim 7 in Japan's panel request states that Korea's measures imposing anti-dumping duties
on pneumatic valves from Japan are inconsistent with Korea's obligations under:
Articles 3.1 and 4.1 of the [Anti-Dumping] Agreement because Korea failed to make an
objective examination based on positive evidence in defining the domestic industry
producing the like product and consequently in making a determination of injury[.]
5.20. The Panel found that this claim consisted of a general reference to the language in Article 3.1
of the Anti-Dumping Agreement, which was not sufficient to present the problem clearly. According
to the Panel, merely paraphrasing the language in the first part of Article 3.1 does not explain how
or why Japan considers the measures at issue to be inconsistent with the specific obligations in
Articles 3.1 and 4.1 of the Anti -Dumping Agreement with respect to the definition of the domestic
industry.89 The Panel thus considered that the pan el request was not precise enough to serve the
dual function of defining the basis for the Panel's terms of reference under Article 7.1 of the DSU,
and informing other WTO Members, including the respondent, of the nature of the dispute.90 Rather,
the Panel considered that Japan's claim was "essentially generic", since "nothing in the panel request
link[ed] the claim to the particular circumstances of the investigation at issue." 91 The Panel then
found that its conclusion was confirmed when taking into account the "broad and diverse scope of
the allegations concerning the alleged inconsistency in the definition of the domestic industry"
advanced in Japan's later submissions.92
5.21. On appeal, the participants raise a number of arguments regarding the Panel's articul ation
and application of the legal standard under Article 6.2 of the DSU, generally, as well as certain

89 Panel Report, para. 7.64.
90 Panel Report, para. 7.65.
91 Panel Report, para. 7.64.
92 Panel Report, para. 7.66.

specific arguments for each of the individual claims concerning the Panel's application of Article 6.2.
In this regard, Japan alleges several errors in the Panel's application of Article 6.2 to all of the claims
it found to be outside its terms of reference. 93 First, Japan argues that the Panel failed to consider
the nature of the obligation at issue in each case, and that, for claims involving Article 3.1 of the
Anti-Dumping Agreement, the Panel focused inordinately on that part of Japan's panel request
related to this provision. 94 Regarding claim 7, in particular, Japan argues that the Panel never
discussed the narrow and specific obligation under Article 4.1 of the Anti -Dumping Agreement to
define the domestic industry properly, and instead focused on Article 3.1 as a general obligation.95
5.22. Second, Japan argues that the Panel failed to consider the nature of the measure, despite the
fact that four of the claims expressly correspond to specific sections of the measure at issue. 96 In
particular, Japan argues that, because claim 7 refer red specifically to "defining the domestic
industry"97, and the corresponding part of the measure at issue also references Article 4.1, Korea
should have been able to fully understand this claim.98 Third, Japan argues that the Panel improperly
relied on the phrase "how or why" used by the Appellate Body in certain disputes to create "its own
arbitrary standard"99 requiring a complainant "to show not only a 'claim', but also the 'argument' in
support of that claim".100 Finally, Japan argues that the Panel improperly relied on later arguments,
contrary to the Appellate Body's findings that , "[c]ompliance with the requirement of Article 6.2
must be determined on the face of the panel request, and a panel request should be evaluated based
on what existed at that time."101
5.23. As a preliminary matter, Korea submits that Japan's claims are essentially concerned with the
Panel's alleged lack of reasoned and adequate explanation, its alleged failure to consider certain
facts, and the allegedly "unfair" nature of the Panel's app roach, which Japan should have brought
under Article 11 of the DSU. 102 Turning to the specific errors alleged by Japan, Korea begins by
noting that, given the multifaceted nature of the obligations referenced in Japan's claims, the Panel
did not err in consi dering that Japan's panel request failed to summarize the "how or why" of the
violation.103 Korea adds that the Panel did not ignore the fact that Japan's claim 7 was made pursuant
to Articles 3.1 and 4.1 in combination, but found that the "generic" reference to Articles 3.1 and 4.1
was insufficient to present the problem clearly.104
5.24. Furthermore, Korea argues that the Panel did not fail to consider the nature of the measure.105
According to Korea, the frequent references in the investigating authorities' determin ations to the
relevant legal obligations under the Anti-Dumping Agreement "[are] not a factor for determining the
sufficiency of the claims made in a request for the establishment of a panel". 106 Korea also argues
that, contrary to Japan's argument, the Panel indicated that a complainant is not required to present
a summary of the arguments in the panel request. Korea asserts, however, that Japan cannot meet
the requirements of Article 6.2 of the DSU "by simply indicating the legal basis of the claim and
paraphrasing the obligation".107 Korea further contends that, from a due process perspective, Japan's
claim 7 concerning the definition of the domestic industry did not allow Korea to defend itself,
especially in the context of a dispute involving a complex anti -dumping measure.108 Finally, Korea

93 Japan's appellant's submission, para. 27.
94 Japan's appellant's submission, paras. 28-29. See also ibid., paras. 30-37.
95 Japan's appellant's submission, para. 79.
96 Japan's appellant's submission, para. 40. See also ibid., paras. 38-39 and 82.
97 Japan's appellant's submission, para. 82.
98 Japan's appellant's submission, paras. 83-84.
99 Japan's appellant's submission, para. 42.
100 Japan's appellant's submission, para. 43. See also ibid., paras. 44-46 and 90.
101 Japan's appellant's submission, para. 47 (referring to Panel Report, para. 7.20; Appellate Body
Reports, US – Carbon Steel, para. 127; Australia – Apples, para. 418; US – Countervailing Measures (China),
ibid., paras. 48-50 and 91-92.
102 Korea's appellee's submission, para. 6. See also ibid., paras. 67, 167, 229, 244, and 477.
103 Korea's appellee's submission, para. 9.
104 Korea's appellee's submission, para. 85.
105 Korea's appellee's submission, para. 88.
106 Korea's appellee's submission, para. 89 (referring to Appellate Body Report, Thailand – H-Beams,
paras. 94-95).
107 Korea's appellee's submission, para. 10.
108 Korea's appellee's submission, paras. 75-76.

indicates that the Panel properly examined subsequent submissions to confirm its assessment of
Japan's panel request.109
5.25. As we see it, the fact that part of Japan's claim may consist of paraphrasing the language of
Article 3.1 of the Anti-Dumping Agreement is not, in and of itself, sufficient to establish that it does
not comply with the requirements of Article 6.2 of the DS U. While we note the brevity of Japan's
claim as listed in its panel request, we also observe that, beyond paraphrasing Article 3.1 of the
Anti-Dumping Agreement, Japan also refers to Article 4.1 of the Anti-Dumping Agreement, such that
it identifies both Articles 3.1 and 4.1 as the provisions of the covered agreements alleged to have
been breached by Korea. As such, therefore, Japan's panel request fulfils the minimum requirement
identified above, which is to identify the provisions of the covered agreements alleged to have been
breached. The Panel's task should thus have consisted in determining whether, in these
circumstances, the panel request presents the problem clearly by plainly connecting the measure
with these provisions, taking into consideration, inter alia, the nature of the Korean measure, and
the nature of the provisions concerned.
5.26. Furthermore, Japan's claim under Articles 3.1 and 4.1 highlights that Japan is concerned with
the manner in which the Korean investigating authorities "defin[ed] the domestic industry producing
the like product".110 Thus, the panel request, on its face, makes clear that Japan's claim relates
specifically to the portion of the measure at issue that concerns the definition of the domestic
industry and its alleged inconsistency with Korea's obligation under Articles 3.1 and 4.1, and not the
anti-dumping measure "as a whole".111
5.27. Regarding the nature of the provisions concerned, we recall that Article 4.1 of the
Anti-Dumping Agreement defines the term "domestic industry" as either "the domestic producers as
a whole of the like products" or "those [of them] whose collective output of the products constitutes
a major proportion of the total domestic production of those products".112 In addition, in light of the
requirement in Article 3.1 of the Anti-Dumping Agreement that the determination of injury "be based
on positive evidence and involve an objective examination", "an investigating authority must not act
so as to give r ise to a material risk of distortion in defining the domestic industry", in order "to
ensure the accuracy of an injury determination".113 Thus, insofar as it relates to the definition of the
domestic industry in general, the obligation established by Articles 3.1 and 4.1 is well delineated.
Together, Articles 3.1 and 4.1 establish a distinct obligation, such that Japan's identification of these
provisions in the narrative of the panel request would seem to plainly connect the measure at issue
with the provisi ons of the covered agreement alleged to have been breached, as required by
Article 6.2 of the DSU.
5.28. Korea argues that Japan's claim "simply paraphrased the very general and essentially generic
obligation under Article 3.1", and did not provide any narrativ e as to whether its claim related to
specific aspects of Article 4.1, such as the selection of producers, the level of production represented
by these producers or these producers not being qualitatively representative of domestic production,
or a combination thereof.114 As a result, Korea maintains that it was not possible to know what claim
it had to answer.115

109 Korea's appellee's submission, paras. 11 and 97-102.
110 Emphasis added.
111 See Korea's appellee's submission, para. 88.
112 Appellate Body Report, EC – Fasteners (China) (Article 21.5 – China), para. 5.298 (referring to
Appellate Body Report, EC – Fasteners (China), para. 411). We also recall that, by using the term "a major
proportion", the second method "focuses on the question of how much production must be represented by
those producers making up the domestic industry when the domestic industry is defined as less than the
domestic producers as a whole". (Ibid. (quoting Appellate Body Report, EC – Fasteners (China), para. 411)
(emphasis original)) The Appellate Body has read the "major proportion" requirement as having both
quantitative and qualitative aspects. (Ibid., para. 5.302) Article 4.1 also prescribes two specific ways for
defining the domestic industry in the particular situations in which: (i) producers are related to exporters or
importers or are themselves importers; or (ii) the territory of a Member is divided into two or more competitive
markets in exceptional circumstances. (See Article 4.1(i) and (ii) of the Anti-Dumping Agreement)
113 Appellate Body Report, EC – Fasteners (China) (Article 21.5 – China), para. 5.300 (quoting
Appellate Body Report, EC – Fasteners (China), para. 414).
114 Korea's appellee's submission, para. 86.
115 Korea's appellee's submission, para. 86.

5.29. As we understand it, Korea's argument stands for the proposition that there are several ways
in which an investigating authority can breach the obligation established by Articles 3.1 and 4.1, and
that Japan's panel request does not specify in which of these ways the Korean investigating
authorities allegedly breached the obligation in question. However, the fact that " an investigating
authority can act inconsistently with [a provision] in different ways, does not … mean that [it]
therefore contains multiple, distinct obligations". 116 In our view, the different ways highlighted by
Korea in which the obligation can be breached do not establish many different obligations, but are
rather different alternatives by which the Korean investigating authorities might have failed to
ensure that the domestic industry was defined consistently with Articles 3.1 and 4.1, in a manner
that ensures that the accuracy of an injury determination is not undermined by introducing a material
risk of distortion in this definition.
5.30. As noted above, the Panel relied on Japan's later submissions in order to confirm its finding
that Japan's claim concerning the definition of the domestic industry was not within its terms of
reference. The Panel found the "allegations" under Articles 3.1 and 4.1 in these submissions to be
"broad and diverse" in comparison with the narrative of the panel request.117 In our view, however,
similar to the different "aspects" of the obligation under Article 4.1 that Korea refers to, these
"allegations" referenced by the Panel are also diffe rent ways in which the Korean investigating
authorities may have breached the obligation under Articles 3.1 and 4.1. As we see it, the se
allegations relate to the manner in which the Korean investigating authorities allegedly failed to
define the domestic industry properly, namely, by including only two domestic producers
representing slightly more than half of the total domestic production and consisting of the applicants
only118, by failing to make efforts to collect information from other domestic producer s or other
sources and to ensure that the domestic industry was representative of the total domestic
production119, and by failing to consider evidence objectively and adequately reason the decision to
exclude certain producers from the definition. 120 In our v iew, in making these allegations, Japan
elaborated on why it considered that the Korean investigating authorities failed to define the
domestic industry consistently with the requirements under Articles 3.1 and 4.1, that is, to define
the domestic industry either as all of the domestic producers of the like product, or "a major
proportion" thereof, and to avoid introducing a material risk of distortion to such definition.
5.31. Furthermore, the Appellate Body has said that the term " legal basis of the complaint" in
Article 6.2 of the DSU refers to the claims pertaining to a specific provision of a covered agreement,
that is, an allegation that "the respondent party has violated, or nullified or impaired the benefits
arising from, an identified provision of a parti cular agreement." 121 As such, claims are to be
distinguished from arguments, which are statements put forth by a complaining party "to
demonstrate that the responding party's measure does indeed infringe upon the identified treaty
provision", and do not need to be included in the panel request.122 This is because Article 6.2 requires
only "a brief summary of the legal basis of the complaint".123
5.32. In our view the elements that , in Korea's view, Japan should have developed in its panel
request, as well as Japan's later submissions on which the Panel relied to confirm its finding, are
arguments rather than claims, particularly because they do not relate to different obligations, but
rather serve to explain the manner in which the Korean investigating authorities allegedly breached
the obligation contained in Articles 3.1 and 4.1 of the Anti -Dumping Agreement. Japan was not
required to include in its panel request the level of detail asserted by Kor ea in order to provide a
"brief summary of the legal basis of the complaint sufficient to present the problem clearly".
5.33. According to the Panel, the fact that Japan did not provide more detail in its panel request
meant that its claim was "essentially gene ric" and "[did] not explain how or why Japan considers

116 Appellate Body Report, US – Countervailing Measures (China), para. 4.24.
117 Panel Report, para. 7.66.
118 See Panel Report, para. 7.66.a-b.
119 See Panel Report, para. 7.66.c-d.
120 See Panel Report, para. 7.66.e-f.
121 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.14 (quoting
Appellate Body Report, Korea – Dairy, para. 139).
122 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.14 (quoting
Appellate Body Report, Korea – Dairy, para. 139). See also Appellate Body Report, US – Countervailing
Measures (China), para. 4.9.
123 Emphasis added.

that the Korean Investigating Authorities' definition of the domestic industry did not involve an
objective examination or was not based on positive evidence". 124 We consider that the Panel's
reasoning was based on a misunderstanding of the significance of the term "how or why" that the
Appellate Body has used at times.125 The Panel appears to have considered this term to entail that
a complainant would be required to include in the narrative of its panel request a level of detail going
beyond setting out the claim underlying the complaint. However, as stated above, by using the term
"how or why" in certain cases, the Appellate Body did not introduce a legal standard different from
the one outlined in paragraphs 5.3 to 5.9 above.
5.34. In sum, Ja pan's panel request refers to both Articles 3.1 and 4.1 of the Anti -Dumping
Agreement and thus identifies the provisions of the covered agreements alleged to have been
breached. Japan's claim also makes clear that it relates specifically to the portion of the measure at
issue concerning the definition of the domestic industry and its alleged inconsistency with Korea's
obligation under Articles 3.1 and 4.1. In turn, Articles 3.1 and 4.1 together establish a distinct,
well-delineated obligation regarding the definition of the domestic industry. Thus, Japan's claim 7
"provide[s] a brief summary of the legal basis of the complaint sufficient to present the problem
clearly" within the meaning of Article 6.2 of the DSU.
5.35. For the foregoing reasons, we find that the Panel erred in finding that claim 7 in Japan's panel
request was not within its terms of reference. Consequently, we reverse the Panel's finding , in
paragraphs 7.67 and 8.1.a of the Panel Report, and find that Japan's claim 7 is within the Panel's
terms of reference.
5.2.2 Whether the Appellate Body can complete the legal analysis
5.2.2.1 Introduction
5.36. Japan submits that, if the Appellate Body reverses the Panel's finding that Japan's claim under
Articles 3.1 and 4.1 of the Anti -Dumping Agreement was not within its terms of reference, the
Appellate Body should complete the legal analysis and find that the Korean investigating authorities'
definition of the domestic industry was inconsistent with these provisions. In Japan's view, "this
claim rests on undisputed facts"126, in that the section entitled "Relevant facts" in the Panel Report
sets forth all the key facts needed to resolve this claim. 127 On the basis of the facts set out in this
section, Japan claims that the KTC acted incons istently with Articles 3.1 and 4.1 by defining the
domestic industry as consisting of the two applicants, whose production the KTC found to constitute
a major proportion of the total domestic production of the like products. Japan contends that the
domestic industry as defined by the KTC failed to meet the qualitative and quantitative elements of
the "major proportion" requirement pursuant to Articles 3.1 and 4.1.128
5.37. Korea submits that the Panel did not explore the substantive issues and did not make any
factual findings with respect to Japan's claim under Articles 3.1 and 4.1.129 According to Korea, the
"Relevant facts" section of the Panel Report "describes some of the issues that were discussed in the
course of the proceedings", but it contains neither factua l findings by the Panel nor an overview of
the undisputed facts on the record.130 Korea further contends that the Panel's summary of relevant
facts is incomplete and, as such, do es not provide a sufficient basis for the Appellate Body to

125 See para. 5.7 above.
126 Japan's appellant's submission, para. 93. Japan also argues that this claim is "closely related to the
Article 3 claims [that] the Panel did address", i.e. claims under Articles 3.1, 3.4, and 3.5 of the Anti-Dumping
Agreement. (Ibid.) However, Japan does not explain how the claim under Articles 3.1 and 4.1 is "closely
related" to its claims under Article 3 of the Anti-Dumping Agreement. Japan also does not identify facts or
findings pertaining to "the Article 3 claims that the Panel did address" in support of its Articles 3.1 and 4.1
arguments, other than those contained in the "Relevant facts" section of the Panel Report for the Articles 3.1
and 4.1 claim.
127 Japan's appellant's submission, para. 94 (referring to Panel Report, paras. 7.46-7.55).
128 Japan's appellant's submission, paras. 101-107.
129 Korea's appellee's submission, paras. 19 and 106-107.
130 Korea's appellee's submission, para. 108.

complete the legal analysis.131 In any event, Korea submits that the Korean investigating authorities
defined the domestic industry consistently with Articles 3.1 and 4.1.132
5.38. The Appellate Body has completed the legal analysis with a view to facilitating the prompt
settlement and effective resolution of the dispute only when the factual findings by the panel and/or
undisputed facts on the panel record provide a sufficient factual basis for doing so.133 In this regard,
the Appellate Body has found that the plain text of an investiga ting authority's determinations in a
trade remedy investigation could be relied on in completing the legal analysis.134 Moreover, the
Appellate Body has declined to complete the legal analysis in view of due process considerations135,
for example, where the panel had not examined a claim at all136, or where there had not been a full
exploration of the issues 137 or scrutiny of the relevant evidence by the panel. 138 With these
considerations in mind, we turn to recall briefly the relevant legal standard under Articles 3.1 and
4.1 of the Anti -Dumping Agreement and the relevant facts, before reviewing whether we could
complete the legal analysis as requested by Japan.
5.2.2.2 Relevant legal standards
5.39. The first sentence of Article 4.1 of the Anti-Dumping Agreement provides for two methods of
defining the domestic industry. It states:
Article 4
Definition of Domestic Industry
4.1 For the purposes of this Agreement, the term "domestic industry " shall be
interpreted as referring to the domestic producers as a whole of the like products or to
those of them whose collective output of the products constitutes a major proportion of
the total domestic production of those products[.]139
5.40. Under the second method of defining the domestic industry, the "major proportion of the total
domestic production" is determined by comparing the collective output of producers considered for
inclusion with the production as a whole. 140 The Appellate Body has read the "major proportion"

131 Korea's appellee's submission, para. 109.
132 Korea's appellee's submission, paras. 120 and 149.
133 See e.g. Appellate Body Reports, Australia – Salmon, paras. 117-119; US – Large Civil Aircraft
Act, para. 343; EC and certain member States – Large Civil Aircraft, para. 1178; Colombia – Textiles,
certain member States – Large Civil Aircraft (Article 21.5 – US), para. 5.745; US – Continued Zeroing,
para. 195.
134 See e.g. Appellate Body Report, US – Countervailing Measures (China), para. 4.83.
135 See e.g. Appellate Body Reports, Russia – Commercial Vehicles, para. 5.141 (referring to
Appellate Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program, para. 5.224;
EC ‒ Seal Products, paras. 5.63 and 5.69; US – Anti-Dumping Methodologies (China), para. 5.146);
EC – Export Subsidies on Sugar, para. 339; Peru – Agricultural Products, para. 5.157; Colombia – Textiles,
136 See e.g. Appellate Body Report, Russia – Pigs (EU), para. 5.141 (referring to Appellate Body Reports,
EC – Poultry, para. 107; EC – Asbestos, paras. 79 and 82; US – Section 211 Appropriations Act, para. 343;
EC – Export Subsidies on Sugar, para. 337).
137 See e.g. Appellate Body Reports, EC – Asbestos, paras. 81-82; EC ‒ Seal Products, para. 5.69;
Russia – Commercial Vehicles, para. 5.141; EC and certain member States – Large Civil Aircraft
(Article 21.5 – US), para. 5.721.
138 See e.g. Appellate Body Report, US – Countervailing Measures (China), para. 4.157.
139 Emphasis added. Article 4.1 goes on to provide for two situations where producers of the like product
may be excluded from the definition of the domestic industry, namely: (i) where producers are "related" to
exporters or importers or are themselves importers of the allegedly dumped product; and (ii) where the
territory of a Member is divided into two or more competitive markets and the producers within each market
are regarded as a separate industry under specified conditions.
140 Appellate Body Report, EC – Fasteners (China), para. 412. As indicated by the Appellate Body, "the
collective output of 'those' producers must be determined in relation to the production of the domestic
producers as a whole." (Ibid.)

requirement in Article 4.1 as having both quantitative and qualitative aspects.141 With regard to the
quantitative consideration, "a major proportion" should be properly understood as a relatively high
proportion of the total domestic production , and will standardly serve as a substantial reflection of
the total domestic production. 142 The qualitative consideration, in turn, is concerned with whether
the domestic producers of the like product that are included in the definition of the domestic industry
are representative of the total domestic production. 143 The quantitative and qualitative aspects of
the definition of the domestic industry are closely connected in that "[t]he lower the proportion, the
more sensitive an investigating authority will hav e to be to ensure that the proportion used
sufficiently represents" the total domestic production.144
5.41. Furthermore, in light of Article 3.1, an investigating authority must not act so as to give rise
to a material risk of distortion when defining the domestic industry as a "major proportion" of the
total domestic production pursuant to Article 4.1.145 Such a risk would arise, for example, where the
investigating authorities define the domestic industry "on the basis of willingness to be included in
the [injury] sample", thereby imposing a "self-selection process among the domestic producers".146
A material risk of distortion could also arise if an investigating authority were permitted to leave out
from the definition of the domestic industry domestic producers of the like product that had provided
data and sought to cooperate in the investigation on the basis of alleged deficiencies in the
information provided without seeking to obtain additional information. 147 The Appellate Body has
stated that "there is an inverse relationship between, on the one hand, the proportion of total
production included in the domestic industry and, on the other hand, the existence of a material risk
of distortion in the definition of domestic industry and in the assessment of injury."148 This comports
with the notion that the term "major proportion" has "both quantitative and qualitative
connotations"149, and that t he process by which an investigating authority defines the domestic
industry, including the degree of efforts made by the investigating authority in obtaining information,
is also relevant in assessing the qualitative aspect of the requirement.
5.42. Finally, in view of "[t]he practical constraint on an authority's ability to obtain information",
especially in special market situations such as a fragmented industry, "what constitutes 'a major
proportion of the total domestic production' may be lower than what is ordinarily permissible."150 In
such cases, however, "the investigating authority bears the same obligation to ensure that the
process of defining the domestic industry does not give rise to a material risk of distortion" and

141 Appellate Body Reports, EC – Fasteners (China) (Article 21.5 – China), para. 5.302;
Russia – Commercial Vehicles, para. 5.12.
142 Appellate Body Report, EC – Fasteners (China), para. 412.
143 Appellate Body Report, Russia – Commercial Vehicles, para. 5.13.
144 Appellate Body Report, Russia – Commercial Vehicles, para. 5.13. See also Appellate Body Report,
EC – Fasteners (China), para. 412.
145 Appellate Body Report, EC – Fasteners (China), para. 414. See also Appellate Body Report,
EC – Fasteners (China) (Article 21.5 – China), para. 5.300.
146 Appellate Body Report, EC – Fasteners (China), para. 427. In the subsequent compliance dispute
pursuant to Article 21.5 of the DSU, the Appellate Body found that the investigating authority relied on the
same Notice of Initiation that conditioned the producers' eligibility to be included in the domestic industry on
their willingness to be included in the injury sample. The Appellate Body found that the investigating authority
failed to eliminate the material distortive effects on the composition of the group of domestic producers that
had come forward. (Appellate Body Report, EC – Fasteners (China) (Article 21.5 – China), para. 5.314)
147 Appellate Body Report, Russia – Commercial Vehicles, paras. 5.21-5.22. In that dispute, the
investigating authority defined the domestic industry as a single producer accounting for 87.9% of the total
domestic production of the like product. (Ibid., para. 5.6) While there were two producers that cooperated with
the investigation and provided data, the investigating authority decided not to include one of the two producers
in the definition of the domestic industry after having reviewed that producer's data due to certain deficiencies
in the data. (Ibid., para. 5.4) The Appellate Body found that the investigating authority acted inconsistently
with Articles 3.1 and 4.1 of the Anti-Dumping Agreement, stating that the investigating authority "should seek
to obtain additional information" from the domestic producer that provided allegedly deficient information, and
that several provisions of the Anti-Dumping Agreement provide "tools … to address the inaccuracy and
148 Appellate Body Report, Russia – Commercial Vehicles, para. 5.13. See also Appellate Body Report,
EC – Fasteners (China) (Article 21.5 – China), para. 5.302.
149 Appellate Body Report, EC – Fasteners (China) (Article 21.5 – China), para. 5.302.
150 Appellate Body Report, EC – Fasteners (China), para. 415.

"would need to make a greater effort to ensure that the selected domestic producers are
representative of the total domestic production".151
5.2.2.3 Overview of relevant facts relating to the definition of the domestic industry
5.43. As a result of its finding that Japan's claim under Articles 3.1 and 4.1 was not within the
Panel's terms of reference, the Panel did not examine the merits of the claim.152 Nonetheless, the
Panel Report contains a section entitled "Relevant facts", which describes the relevant aspects of the
underlying anti-dumping investigation at issue relating to Japan's claim under Articles 3.1 and 4.1.
In this section, the Panel quoted or summarized the relevant content of the documents on the Panel
record.153 Neither participant disputes the accuracy of the Panel's summary contained in this section.
5.44. According to the "Relevant facts" section and the evidence on the Panel record referenced
therein, the OTI sent the questionnaires to all nine known producers of the like product, but only
the two applicants, namely TPC Mechatronics Corporation (TPC) and KCC Co., Ltd. (KCC), submitted
responses and reported their production volumes.154 Two of the remaining seven producers, Yonwoo
Pneumatic ( Yonwoo) and Shin Yeong Mechatronics ( Shin Yeong ), did not respond to the
questionnaire, referring to the lack of resources. 155 Subsequently, i.e. after the public hearing with
interested parties, these two producers submitted limited data, including their 2013 production
volumes.156 As for the other five domestic producers, the Panel Report indicates that, because the
OTI "did not have any reliable source from which it could obtain accurate production data of domestic
producers of the pneumatic valves", it calculated the production volume based on the data provided
by the applicants. 157 Based on these data, the OTI found that the production volume of the two
applicants constituted 55.4% o f the total domestic production of the like product. 158 The OTI
considered that the two applicants' combined production volume accounted for "a considerable
portion of the total domestic production" and that, "[f]or the purpose of the investigation into the
injury to the domestic industry[,] … the 'domestic industry' is defined as the 'total of TPC's and KCC's
businesses producing a like product'."159
5.45. The OTI noted the Japanese respondents' argument that it should take into account all
identified domestic producers of the like product for the purpose of the injury determination.160 The
OTI considered that, "if it is impossible to obtain [relevant ] data on the entire domestic industry
despite the relevant efforts of the investigation authorities , and if the compani es whose data are
available account for a majority proportion of the domestic industry, it is appropriate and reasonable

151 Appellate Body Report, EC – Fasteners (China) (Article 21.5 – China), para. 5.303. See also
Appellate Body Report, EC – Fasteners (China), para. 416.
152 Panel Report, para. 7.67. The Panel stated that it "will neither consider [Japan's claim under
Articles 3.1 and 4.1] further nor resolve it". (Ibid.)
153 Panel Report, paras. 7.46-7.55 and fns 82-109 thereto. These documents include: (i) the
investigation application; (ii) OTI, Preliminary Report on Dumping and Injury to Domestic Industry of Valves
for Pneumatic Transmissions imported from Japan, 26 June 2014 (OTI's Preliminary Report) (Panel Exhibit
JPN-2b); OTI, Interim Investigation Report on Dumping and Injury to Domestic Industry of Valves for
Pneumatic Transmissions from Japan, 23 October 2014 (OTI's Interim Report) (Panel Exhibit JPN-3b); and
OTI's Final Report (Panel Exhibit KOR-2b (BCI)); (iii) KTC, Resolution of Preliminary Determination on Dumping
and Injury to the Domestic Industry of Valves for Pneumatic Transmissions from Japan, 26 June 2014 (KTC's
Preliminary Resolution) (Panel Exhibit JPN-1b) and KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)); and
(iv) Korea's responses to the Panel's questions. Most of the facts in the "Relevant facts" section correspond to
the content of these underlying documents on the Panel record.
154 Panel Report, para. 7.49.
155 Korea's first written submission to the Panel, para. 315. See also Panel Report, para. 7.49 (referring
to OTI's Final Report (Panel Exhibit KOR-2b (BCI)), p. 22 and fn 32 thereto); Korea's appellee's submission,
para. 115. We note that the names of Yonwoo and Shin Yeong were redacted in the underlying documents
(e.g. KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)) and OTI's Final Report (Panel Exhibit KOR-2b (BCI))).
However, Korea unredacted the names of these companies in its submissions. (See Korea's first written
submission to the Panel, para. 315) During the oral hearing, Korea confirmed that the names of Yonwoo and
Shin Yeong are not to be treated as BCI.
156 Korea's appellee's submission, paras. 118 and 139-140; response to Panel question No. 102,
paras. 83 and 85. See also Panel Report, para. 7.49; OTI's Final Report (Panel Exhibit KOR-2b (BCI)), pp. 19,
71, and 112.
157 Panel Report, para. 7.49 (quoting Korea's response to Panel question No. 102, paras. 78 and 81).
158 Panel Report, para. 7.49. See also OTI's Final Report (Panel Exhibit KOR-2b (BCI)), p. 19.
159 Panel Report, para. 7.49 (quoting OTI's Final Report (Panel Exhibit KOR-2b (BCI)), pp. 22-23).
160 Panel Report, para. 7.50.

to analyze the injury to the domestic industry only based on the data from such companies."161 The
OTI added that, due to the fact that m ost domestic producers were small and m edium-sized
companies and the lack of associations, groups , or research institutions in connection with the
pneumatic valve industry, it would be "impossible to obtain reliable materials on the business
conditions of the overall domestic industry".162
5.46. In addition, the OTI indicated that it conducted "an additional i nvestigation" into the two
domestic producers that submitted limited production and profitability data, Yonwoo and Shin Yeong,
in light of the Japanese respondents' argument that these two producers were not suffering from
injury.163 The OTI found that both producers "showed changes in indicators similar to those of the
applicants during the [period of investigation ( POI)]".164 The OTI further found that, although the
operating profit ratio of these two companies "was relatively good compared to that of the
applicants", this was due mainly to their smaller selling, general, and administrative (SG&A)
expenses.165
5.47. On the basis of the OTI's findings, the KTC stated in its Final Resolution that the domestic
industry was properly defined as the total of TPC and KCC's businesses producing the like product.166
The KTC also noted that the OTI had "conducted an additional analysis by including some producers
mentioned by the respondents among the domestic producers who did not participate in the
investigation, to the extent that data related thereto were available".167 The KTC concluded that the
OTI's findings in this respect showed that the inclusion of these companies "would not significantly
change the overall trends of the injury indicators of the domestic industry".168
5.2.2.4 Whether the Appellate Body can complete the legal analysis regarding Japan's
claim that the Korean investigating authorities' definition of the domestic industry is
inconsistent with Articles 3.1 and 4.1 of the Anti-Dumping Agreement
5.48. The domestic industry at issue was defined as those producers whose production accounted
for a "major proportion" of the total domestic production under Article 4.1 of the Anti -Dumping
Agreement. As noted above, the Appellate Body has read the "major proportion" requirement in
Article 4.1 as having both quantitative and qualitative aspects, which are closely connected.
5.49. Regarding the quantitative aspect of the "major proportion" requirement, Japan alleges
several defects in the KTC's calculation of the proportion of the total domestic output attributable to
the domestic producers that were included in the definition of the domestic industry (i.e. TPC and
KCC, who are also the two applicants of the anti-dumping investigation). Japan argues that "the KTC
did not consider the available evidence objectively" by accepting the production volumes provided
by the applicants for the five producers that did not provide any information.169 Japan contends that
"[t]he OTI did not even bother to confirm the accuracy of this basic number" or to "confirm, update,
or verify … this information with subsequently submitted information for the two partially cooperative
firms, Yonwoo and Shin Yeong" .170 Korea disputes this and contends that "the numbers origina lly
provided by the applicants for Yonwoo and Shin Yeong were surprisingly similar to the actual
production volumes submitted later by Yonwoo and Shin Yeong themselves."171 Korea also contends
that "[the] KTC confirmed with the applicants that they had estim ated the production volumes of
the other five domestic producers taking into account the total output of pneumatic valves in the

161 Panel Report, para. 7.50 (quoting OTI's Final Report (Panel Exhibit KOR-2b (BCI)), p. 23). (emphasis
added)
162 Panel Report, para. 7.51 (quoting OTI's Final Report (Panel Exhibit KOR-2b (BCI)), p. 24).
163 Korea's response to Panel question no. 64; Panel Report, para. 7.52 (quoting OTI's Final Report
(Panel Exhibit KOR-2b (BCI)), p. 24; referring to OTI's Final Report (Panel Exhibit KOR-2b (BCI), pp. 70-71)).
See also Korea's appellee's submission, para. 118.
164 Panel Report, para. 7.52 (referring to OTI's Final Report (Panel Exhibit KOR-2b (BCI)), pp. 70-71).
165 Panel Report, para. 7.52 (referring to OTI's Final Report (Panel Exhibit KOR-2b (BCI)), pp. 70-71).
166 Panel Report, para. 7.54 (referring to KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 13).
167 Panel Report, para. 7.54 (quoting KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 14;
referring to KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 24).
168 Panel Report, para. 7.55 (quoting KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 24).
169 Japan's appellant's submission, para. 106.
170 Japan's appellant's submission, para. 106. (fns omitted)
171 Korea's appellee's submission, para. 140.

Korean market, the size of production capacity of these five producers, and the overall market shares
of the five producers generally known to the players in the Korean market."172
5.50. Although Japan and Korea raised similar arguments before the Panel 173, the Panel did not
explore these arguments, nor is there anything in the "Relevant facts" section that addresses these
arguments. Moreov er, neither Japan nor Korea directed us to findings in the Panel Report or
undisputed facts on the Panel record that would allow us to assess the objectivity and sufficiency of
the evidentiary basis of the Korean investigating authorities' examinations as to whether they
"confirmed" the applicants' estimations.
5.51. In addition, we note Japan's argument that the calculation of the applicants' proportion of the
total domestic output (i.e. 55.4%) was undermined by the inconsistencies between the production
volumes submitted by Yonwoo and Shin Yeong before the investigation was initiated and their
production volumes relied on by the OTI in its Final Report.174 In response, Korea explains that the
production volumes of Yonwoo and Shin Yeong relied on by the OTI in the Final Report were from
2013 and covered the "like products", whereas the production volumes provided by Yonwoo and
Shin Yeong before the investigation was initiated were from 2012 and did not represent the
"like products", because these data were provided before the scope of subject products was defined
by the investigating authorities. 175 We note that Yonwoo and Shin Yeong's production data are
directly relevant to determining the proportion of the total domestic production of pneumatic valves
attributable t o TPC and KCC (i.e. two applicants defined as the domestic industry in the
investigation), as they are part of the total domestic output with which TPC and KCC's production
was compared and the proportion of 55.4% was calculated. While the same arguments were
presented by Japan and Korea before the Panel176, the Panel did not explore the issue, including by,
inter alia, scrutinizing and weighing the evidence before it.
5.52. Thus, in the absence of relevant factual findings, sufficient undisputed facts on the Panel
record, and sufficient exploration of these issues by the Panel, we are unable to assess whether the
KTC considered the available evidence objectively in calculating the proportion of the total domestic
production attributable to the applicants.
5.53. With respect to the qualitative aspect of the "major proportion" requirement, Japan argues
that "the KTC provided no explanation at all … to show whether and how the two [applicants] could
be considered to represent the total domestic production as a whole."177 As a result, Japan contends
that there was a material risk of distortion in the KTC's definition of the domestic industry. 178
According to Japan, "the KTC should have included more domestic producers (regardless of whether
they were willing to cooperate at that point of time) … so that the definition of the domestic industry
would be sufficiently representative" or, if necessary, the KTC could have relied on "facts available"
under Article 6.8 of the Anti -Dumping Agreement.179 In response, Korea contends that there was
"nothing in the process" leading up to the definition of the domestic industry at issue that "was
skewed in favor of one of the parties or biased in any way".180 Rather, all domestic producers were
invited to participate and received questionnaires, but only the applicants returned responses.181
5.54. As indicated in the "Relevant facts" section of the Panel Report, although th e Korean
investigating authorities contacted all known domestic producers of the like product, only the
applicants submitted responses to the questionnaires. In this regard, the situation in the present
case differs from the previous disputes in which an investigating authority was found to have failed

172 Korea's appellee's submission, para. 141.
173 Korea's response to Panel question No. 102, paras. 80-81; Japan's comments on Korea's response to
Panel question No. 102, paras. 76-78; second written submission to the Panel, para. 197.
174 Japan's appellant's submission, para. 106 (referring to Japan's second written submission to the
Panel, para. 198).
175 Korea's appellee's submission, paras. 144-145 (referring to Korea's response to Panel question
No. 102).
176 See Japan's second written submission to the Panel, para. 198; Korea's response to Panel question
No. 102, paras. 82-85.
177 Japan's appellant's submission, para. 101.
178 Japan's appellant's submission, paras. 102-103.
179 Japan's appellant's submission, para. 103. (fn omitted)

to avoid a material risk of distortion in its definition of the domestic industry. As noted above, in
those disputes, the investigating authorities either imposed a self-selection process whereby only
those producers that chose to be included in the injury sample made up the domestic industry182, or
they excluded a cooperating producer from the definition of the domestic industry due to alleged
deficiencies in the submitted data.183
5.55. In addition, we recall that what constitutes a "major proportion" may be lower in light of the
practical constraints of obtaining information. 184 This is not to suggest, however, that difficulty in
obtaining data is, by itself, sufficient to relieve the investigating authorities of their duty under
Articles 3.1 and 4.1 of the Anti-Dumping Agreement. As noted above, investigating authorities have
an obligation to ensure that the process of defining the domestic industry does not give rise to a
material risk of distortion and to make a great er effort to ensure that the domestic producers
included in the definition of the domestic industry are indeed representative of the total domestic
production.185 Thus, although only the applicants initially responded to the questionnaires, this in
itself did not necessarily mean that the qualitative aspect of the definition of the domestic industry
at issue comports with the requirements of Articles 3.1 and 4.1. Rather, completing the legal analysis
on Japan's claim under Articles 3.1 and 4.1 would require an assessment of whether the producers
included in the domestic industry as defined by the KTC were indeed representative, and whether
the Korean investigating authorities acted in a manner that gave rise to a material risk of distortion.
5.56. In this regard, we note Korea's assertions that the two applicants represented a "relatively
high production volume", the two applicants were "genuinely representative of the total domestic
production" based on certain features of their operations , and "there was a low risk that they
somehow would not sufficiently represent the domestic producers as a whole." 186 Korea made the
same argument before the Panel 187, but the Panel did not explore this argument or include any
statements in this regard in the "Relevant facts" section.188 While there are facts on the Panel record
that may potentially be relevant in addressing Korea's argument189, in the absence of any exploration
of the issue by the Panel, we consider that completing the legal analysis would raise d ue process
concerns.
5.57. In addition, we recall that the process by which an investigating authority defines the domestic
industry, including the degree of efforts made by the investigating authority, is relevant in assessing
whether there was a material risk of distortion in defining the domestic industry. 190 In the present
case, Japan and Korea dispute the characterization of the efforts made by the Korean investigating
authorities. Specifically, Japan contends that the Korean investigating authorities were "pa ssive" in
gathering information for purposes of defining the domestic industry. 191 Korea contends that "it is
highly disputed that the Korean investigating authorities were 'passive'." 192 The same arguments

182 Appellate Body Report, EC – Fasteners (China), para. 427.
183 Appellate Body Report, Russia – Commercial Vehicles, paras. 5.21-5.22.
184 Appellate Body Report, EC – Fasteners (China), para. 415.
185 Appellate Body Reports, EC – Fasteners (China) (Article 21.5 – China), para. 5.303; EC – Fasteners
(China), para. 416.
186 Korea's appellee's submission, para. 132. Specifically, Korea argues that "it is clear that the two
Korean producers that formed the domestic industry produced a wide range of the pneumatic valve models
included in the product definition; they sold valves both individually and as a part of the pneumatic system;
they sold pneumatic valves for equipment in a diverse range of major industries, and they sold in the domestic
Korean market through the main distributing channels." According to Korea, the two producers that formed the
domestic industry were "thus genuinely representative of the total domestic production". (Ibid. (fn omitted))
187 Korea's first written submission to the Panel, paras. 309-310.
188 During the oral hearing, Japan acknowledged that Korea made the same argument before the Panel
but that the Panel made no findings in the Panel Report.
189 The OTI's Final Report describes various aspects of the two applicants' operations relied on by Korea,
such as the number of models that the two applicants produce, their sales of pneumatic valves as part of the
pneumatic system, their customer base, and their distribution channel. (OTI's Final Report (Panel Exhibit
KOR-2b (BCI)), pp. 4, 9, 15, and 17)
190 As discussed above in paragraph 5.41and footnote 147 thereto, the Appellate Body in
Russia – Commercial Vehicles faulted the investigating authorities for excluding a cooperating domestic
producer on the basis of alleged deficiencies in its questionnaire response without seeking additional
information. (Appellate Body Report, Russia – Commercial Vehicles, para. 5.22).
191 Japan's appellant's submission, para. 95.
192 Korea's appellee's submission, para. 110.

were raised before the Panel193, but the Panel did not explore them or include in the "Relevant facts"
section any statement regarding whether the Korean investigating authorities were "passive".
Moreover, neither Japan nor Korea directed us to findings in the Panel Report or undisputed facts on
the Panel record that would allow us to complete the legal analysis on this issue.
5.58. Furthermore, Japan and Korea dispute the meaning and the relevance of the "additional
analysis" conducted by the OTI for assessing whether the domestic industry defined as TPC and KCC
is representative of the total domestic production. As noted above, following arguments by the
Japanese respondents, the OTI examined the limited data provided by Yonwoo and Shin Yeong 194,
and found that, while "[t]he operating profit ratio of these two compani es was relatively good
compared to that of the applicants", the changes in their indicators were "similar to those of the
applicants during the POI".195 According to Korea, this additional analysis supports its view that there
was no material risk of distort ion.196 Japan, on the other hand, argues that the OTI's analysis was
not adequately reasoned and failed to resolve the material risk of distortion.197 Thus, Japan contends
that the Korean investigating authorities "provided no explanation at all addressing the qualitative
aspects to show whether and how the two petitioning firms could be considered to represent the
total domestic production as a whole".198
5.59. Although the OTI's "additional analysis" is described in the "Relevant facts" section of the
Panel Report, this section does not contain any evaluation by the Panel of such analysis in light of
the arguments presented by Japan and Korea. In particular, Korea relies on the OTI's discussion of
the similarity in the pattern of certain performance indicators between the two applicants, on the
one hand, and Yonwoo and Shin Yeong, on the other hand. 199 Japan, in contrast, relies on the
differences in the sales and profits between these two groups of companies in absolute terms.200
These arguments were raised before the Panel201, but the Panel did not assess the OTI's additional
analysis in light of these arguments. Japan's arguments raise the question whether the data
concerning performance indicators of domestic producers are relevan t for assessing the qualitative
aspect of the definition of the domestic industry under Articles 3.1 and 4.1. However, in the absence
of the Panel's exploration of the OTI's additional analysis in light of the parties' arguments, we do
not have a sufficient factual basis to complete the legal analysis to determine whether, and to what
extent, Yonwoo and Shin Yeong's economic indicators were relevant in assessing the
representativeness of the producers included in the definition of the domestic industry (i.e . TPC
and KCC).
5.60. In sum, in defining the domestic industry as a "major proportion" of the total domestic
production, an investigating authority is required to assess both quantitative and qualitative
aspects202, and ensure that it does not act in a manner tha t gives rise to a material risk of
distortion.203 As discussed above, we are unable to complete the legal analysis with regard to the
above aspects of the "major proportion" requirement. First, i n the absence of relevant factual
findings by the Panel or undisputed facts on the Panel record, we are unable to assess whether the
KTC considered the available evidence objectively in calculating the proportion of the total domestic
production accounted for by the applicants. In addition, we do not have sufficient factual findings by
the Panel or undisputed facts on the Panel record to assess whether the two applicants included in
the definition of the domestic industry were sufficiently representative of the total domestic
production, or whether the Korean investiga ting authorities' process of defining the domestic

193 Korea's appellee's submission, para. 110 (referring to Korea's second written submission to the
Panel, paras. 140-142).
194 Korea's response to Panel question no. 64; Panel Report, para. 7.52 (referring to OTI's Final Report
(Panel Exhibit KOR-2b (BCI)), pp. 24 and 70-71). See also Korea's appellee's submission, para. 118.
195 Panel Report, para. 7.52.
196 Korea's appellee's submission, para. 133; response to questioning at the oral hearing.
197 Japan's appellant's submission, para. 102.
198 Japan's appellant's submission, para. 101.
199 Panel Report, para. 7.52; OTI's Final Report (Panel Exhibit KOR-2b (BCI)), p. 71; Korea's response to
questioning at the oral hearing.
200 Japan's first written submission to the Panel, para. 250; response to questioning at the oral hearing.
201 Japan's first written submission to the Panel, paras. 249-252; Korea's comments on Japan's response
to Panel question No. 111.
202 Appellate Body Reports, EC – Fasteners (China) (Article 21.5 – China), para. 5.302;
Russia – Commercial Vehicles, para. 5.12.
203 Appellate Body Reports, EC – Fasteners (China), para. 414; EC – Fasteners (China)

industry introduced a material risk of distortion. Consequently, we find ourselves unable to complete
the legal analysis regarding Japan's claim that the Korean investigating authorities' definition of the
domestic industry is inconsistent with Articles 3.1 and 4.1 of the Anti-Dumping Agreement.
5.3 Determination of injury
5.3.1 Introduction
5.61. Japan's panel request sets out six claims challenging the Korean investigating authorities'
injury determination under the provisions of Article 3 of the Anti -Dumping Agreement. The Panel
found that Japan's panel request, as it relate s to several of these claims, failed to meet the
requirements of Article 6.2 of the DSU to "provide a brief summary of the legal basis of the complaint
sufficient to present the problem clearly". Consequently, the Panel found these claims to be outside
its terms of reference. Specifically, the Panel found that Japan's claims 1204 and 2205, concerning the
Korean investigating authorities' analysis of the volume of the dumped imports and price effects of
such imports, were not within its terms of reference. The Panel found that Japan's claim 3, insofar
as it relates to the Korean investigating authorities' examination of two of the specific economic
factors listed in Article 3.4, was within the Panel's terms of reference, but that the remaining part of
this claim was not.206 Furthermore, the Panel found that Japan's claims 4207 and 6208, concerning the
Korean investigating authorities' causation analysis, were within its terms of reference. Finally, the
Panel found that Japan's claim 5 was within the Panel's terms of reference , insofar as it concerns
the adequacy of the Korean investigating authorities' examination regarding certain known factors,
other than the dumped imports, which caused injury to the domestic industry.209
5.62. Having reached the above findings under Article 6.2 of the DSU, the Panel examined the
substance of Japan's claims that it found to be within its terms of reference, namely those under
Articles 3.1, 3.4, and 3.5 of the Anti -Dumping Agreement. On the basis of its analysis, the Panel
found that the Korean inve stigating authorities did not act inconsistently with Articles 3.1 and 3.4
with respect to their examination of the impact of dumped imports on the state of the domestic
industry210, but acted inconsistently with Articles 3.1 and 3.5 in certain aspects of th eir causation
determination.211
5.63. Japan and Korea each appeal different aspects of the Panel's findings under Article 6.2 of the
DSU and the Panel's substantive findings under the provisions of the Article 3 of the
Anti-Dumping Agreement. In addition, Japan r equests the Appellate Body to complete the legal
analysis regarding the claims under Article 3 that the Panel excluded from its terms of reference,
while Korea maintains that the Appellate Body cannot complete the legal analysis.
5.64. In light of the claims and arguments raised on appeal, we begin by examining whether the
Panel erred in its findings pursuant to Article 6.2 of the DSU regarding Japan's various claims under
Article 3 of the Anti-Dumping Agreement. We will then review the Panel's substantive findings under
Article 3. Finally, if we reverse the Panel's findings under Article 6.2 of the DSU concerning Japan's
claims 1, 2, and/or part of claim 3, and find that these claims were within the Panel's terms of
reference, we will assess whether we can complete the legal analysis with respect to these claims.

204 Panel Report, para. 7.94.
205 Panel Report, para. 7.131.
206 Panel Report, paras. 7.170 and 7.175.
207 Panel Report, para. 7.235.
208 Panel Report, para. 7.226.
209 Panel Report, paras. 7.241 and 7.243. However, the Panel found that the allegation that the KTC
failed to consider some known factors at all is not within its terms of reference. In the Panel's view, nothing in
the panel request hints that the KTC omitted to consider any known factors causing injury. This finding is not
subject to appeal. (Ibid., paras. 7.242-7.243)
210 Panel Report, para. 7.192.
211 Panel Report, paras. 7.272, 7.322-7.323, and 7.349.

5.3.2 Whether the Panel erred in its findings under Article 6.2 of the DSU
5.3.2.1 Whether the Panel erred in finding that Japan's claim 1 concerning the volume of
the dumped imports was not within its terms of reference
5.65. Claim 1 in Japan's panel request states that Korea's measure imposing the anti -dumping
duties on pneumatic valves from Japan (the measure at issue) is inconsistent with Korea's obligations
under:
Articles 3.1 and 3.2 of the [Anti-Dumping] Agreement because Korea's analysis of a
significant increase of the imports under investigation did not involve an objective
examination based on positive evidence[.]
5.66. The Panel considered that Japan's panel request failed to meet the requirements of Article 6.2
of the DSU because Japan's claim merely paraphrased the language in the first part of Article 3.1 of
the Anti-Dumping Agreement without any additional narrative description of the problems that Japan
considered to constitute the alleged inconsist ency. To the Panel, therefore, this was insufficient to
explain how or why Japan consider ed Articles 3.1 and 3.2 to be breached, or to mark out the
parameters of the case of alleged inconsistency with Article 3.2 that Japan advanced in this dispute.
The Panel thus found that Japan's claim was "essentially generic", since nothing in the panel request
linked the claim to the particular circumstances of the investigation at issue.212 The Panel then found
that its conclusion was confirmed when taking into account the scope of the allegations concerning
volume effects advanced in Japan's written submissions.213
5.67. On appeal, Japan argues that the Panel erred in finding that its claim under Articles 3.1
and 3.2 concerning the volume of dumped imports was not within its terms of reference. 214 Japan
argues that its claim "expressly identifies Articles 3.1 and 3.2 as the specific provisions at issue for
this claim"215, but that the Panel "never discussed the narrow and specific obligation under Article 3.2
to analyse the significant increase of the imports, and instead focused on Article 3.1 as a general
obligation".216 Japan also indicates that, with regard to the nature of the measure, the claim
"expressly refers to the Korean measures imposing anti -dumping duties on pneumatic valves from
Japan, as set forth in the KTC's Final Resolution" 217, and that the Korean investigating authorities
should have been able to fully understand that it concerned the ana lysis of the significant increase
in the volume of imports.218 In this regard, Japan indicates that the KTC's Final Resolution expressly
cites Article 3.2 when discussing its obligation under the Anti -Dumping Agreement.219 Japan also
reiterates that the Panel improperly relied on the phrase "how or why"220, and improperly relied on
Japan's arguments in its written submissions.221
5.68. Korea contends that the Panel did not ignore the fact that Japan's claim was made pursuant
to both Articles 3.1 and 3.2. Rather, the Pane l correctly concluded that Japan's panel request only
paraphrased the language of Article 3.1, and did not include any description of what it considered to
be the problems with the Korean investigating authorities' consideration of the volume of dumped
imports under Article 3.2.222 Korea also argues that it is not the task of a panel to discuss the
measures to discover references in the investigation record that could have hinted at the nature of
the problem.223 Korea further maintains that the Panel did not us e the phrase "how or why" to
supersede the Appellate Body's repeated affirmation that parties need not present the arguments in

212 Panel Report, para. 7.91.
213 Panel Report, para. 7.93.
214 Japan's appellant's submission, para. 111.
215 Japan's appellant's submission, para. 113.
216 Japan's appellant's submission, para. 114. (fn omitted)
217 Japan's appellant's submission, para. 118.
218 Japan's appellant's submission, para. 119.
219 Japan's appellant's submission, para. 119.
220 Japan's appellant's submission, para. 124.
221 Japan's appellant's submission, paras. 125-126.
222 Korea's appellee's submission, para. 168.
223 Korea's appellee's submission, para. 172.

support of their claim in their panel request, and did not improperly rely on Japan's arguments made
in written submissions.224
5.69. As noted in section 5.1.2 above, before applying the legal standard under Article 6.2 of the
DSU to Japan's panel request, the Panel set out its understanding of the legal framework for injury
determination under Article 3 of the Anti -Dumping Agreement so as to provide the context for its
examination under Article 6.2 of the DSU.225 In so doing, the Panel indicated that merely mentioning
the first part of Article 3.1, or using the language of that provision in a panel request, will not in
itself normally suffice to present a problem clearly with respect to an allegation of violation of the
Anti-Dumping Agreement.226 Such understanding guided the Panel's subsequent application of t he
legal standard under Article 6.2 of the DSU to Japan's panel request, including claim 1 listed therein.
As discussed in paragraph 5.15 above, the fact that the nar rative of Japan's claims set out in its
panel request paraphrases the language of Article 3.1, in and of itself, is not dispositive of whether
the panel request complies with Article 6.2 of the DSU. In our view, the Panel focused too narrowly
on the part of the narrative of Japan's claim paraphrasing the language of Article 3.1. In doing so,
the Panel failed to assess whether th e narrative, in its entirety and in light of the nature of the
measure and the nature of the obligations established by Article 3.1 and Article 3.2 of the
Anti-Dumping Agreement sufficed to meet the requirements of Article 6.2 of the DSU. Therefore, we
consider that the Panel's overemphasis on the reference to Article 3.1 in Japan's panel request
undermined its analysis under Article 6.2 of the DSU. In our view, whether Japan's paraphrasing of
Article 3.1 of the Anti-Dumping Agreement, together with the remainder of the narrative contained
in the panel request, complies with the requirements of Article 6.2 of the DSU should be assessed
by taking into consideration the relevant circumstances of the claim.227
5.70. We note that, beyond paraphrasing Article 3.1, Japan's claim also includes a reference to
Article 3.2 and indicates that it relates to "Korea's analysis of a significant increase of the imports".
As such, Japan's panel request fulfils the minimum requirement we have identified above, which is
to identify the provisions of the covered agreements alleged to have been breached. The Panel's
task should thus have consisted in determining whether, in these circumstances, the panel request
provides a summary of the legal basis sufficient to present the problem clearly, including by plainly
connecting the measure at issue with these provisions, taking into consideration, for instance, the
nature of the Korean measure and the nature of the provisions concerned.
5.71. With regard to the nature of the measure, claim 1 in Japan's panel request refers to "Korea's
analysis of a significant increase of the imports under investigation". Japan's panel request thus
makes it clear that this claim concerns the specific portion of the measure at issue relating to the
Korean investigating authorities' consideration of the volume of the dumped imports and its alleged
inconsistency with Articles 3.1 and 3.2 of the Anti-Dumping Agreement.
5.72. With regard to the nature of the provisions at issue, we recall that Article 3 "contain[s] several
paragraphs setting out an investigating authority's obligations with regard to various aspects of an
injury determination in anti -dumping … investigations". 228 Article 3.2 governs an investigating
authority's consideration regarding the volume of dumped imports and the effect of such imports on
domestic prices. By clarifying in the narrative of its claim that Japan's concerns are addressed at
"Korea's analysis of a significant increase of the imports under investigation", Japan has thereby
specified which of the elements of Article 3.2 it invokes under its claim, namely the consideration of
volume, contained in the first sentence of Article 3.2.
5.73. The first sentence of Article 3.2 provides that, "[w]ith regard to the volume of the dumped
imports, the investigating authorities shall consider whether there has been a significant increase in
dumped imports, either in absolute terms or relative to production or consumption in the importing
Member."229 Furthermore, an investigating authority's consideration of the volume of dumped
imports pursuant to Article 3.2 is also subject to the overarching principles, under Article 3.1, that
it be based on positive evidence and involve an objective examination.230 In our view, therefore, the

224 Korea's appellee's submission, paras. 175-179.
225 See para. 5.13 above.
227 See paras. 5.5-5.6 above.
228 Appellate Body Report, China – GOES, para. 125.
229 Emphasis added.
230 Appellate Body Report, China – GOES, para. 130.

obligation established by Article 3.1 and the first sentence of Article 3.2 is distinct an d well
delineated, in that it requires investigating authorities to make an objective examination of whether
there has been a significant increase in dumped imports on the basis of positive evidence. Thus, by
referring to Articles 3.1 and 3.2 as the provis ions of the covered agreement alleged to have been
breached by Korea, and by indicating specifically which of the elements in Article 3.2 it concerns,
namely the consideration of the volume of dumped imports, Japan's claim, while brief, plainly
connects the challenged measure with the obligation in question.
5.74. Korea nonetheless argues that Japan's claim concerning the volume of the dumped imports
should be found to be outside the Panel's terms of reference because, "[i]n addition to the indication
of the leg al basis of the complaint, there was no narrative sufficient to present the problem
clearly."231 As noted in section 5.1.1 above, however, in order to plainly connect the challenged
measure with the obligation alleged to have been breached, a complainant is required to include in
its panel request only the legal basis of the complaint, that is, its claim.232 As indicated, the
complainant is not required to include in the narrative of its claim details beyond the legal basis of
the complaint, such as arguments in support of its claim. In addition, as we have indicated in
section 5.2.1 above, the fact that an investigating authority can act inconsistently with a provision
in different ways does not mean that the provision therefore contains multiple, distinct obligations.233
5.75. In this regard, the Panel indicated that the scope of the allegations advanced in Japan's
submissions concerning the Korean investigating authorities' analysis of the volume of imports
confirmed its conclusion that Japan's claim is not within its terms of reference. We recall that the
Panel relied on the following allegations: (i) the KTC failed to find an increa se in the volume of the
dumped imports that was "significant"; (ii) the KTC improperly assumed a competitive relationship
between domestic like products and dumped imports; (iii) the KTC improperly considered the effect
of dumped imports that were still in inventory; and (iv) the KTC failed to consider that no domestic
volume had been displaced by the dumped imports.234
5.76. We also recall that the obligation established by Article 3.1 and the first sentence of Article 3.2
of the Anti -Dumping Agreement is distinct and well delineated, in that it requires investigating
authorities to make an objective examination of whether there has been a significant increase in
dumped imports on the basis of positive evidence. As we see it, Japan's later allegations, on which
the Panel relied, all relate to the different ways in which the Korean investigating authorities failed
to conduct the required examination properly. Therefore, these allegations appear to us to be
arguments setting out the reasons why Japan considers that Ko rea has breached the obligation
established by Articles 3.1 and 3.2 concerning the volume of the dumped imports. Thus, by relying
on these later allegations as a confirmation that Japan's claim was not sufficiently detailed to comport
with the requirements of Article 6.2 of the DSU, the Panel appears to have erroneously considered
that Japan should have included arguments in support of its claim in the panel request.
5.77. We also indicated in section 5.2.1 above that the Panel's similar findings in the context of
Japan's claim relating to the definition of the domestic industry had apparently been informed by
the Panel's misunderstanding of the significance of the term "how or why". 235 For the reasons
outlined above, the Appellate Body's reference to the term "how or why" in certain disputes did not
suggest a legal standard different from that under Article 6.2 of the DSU, and did not suggest that
complainants are required to include more detail beyond the leg al basis of their complaint in their
panel requests.
5.78. In sum, Japan's claim 1 identifies both Articles 3.1 and 3.2 of the Anti -Dumping Agreement
as the provisions alleged to have been breached and indicates that it relates to "Korea's analysis of
a significant increase of the imports under investigation". This claim thus identifies the provisions of
the covered agreements alleged to have been breached . It further makes it clear that it concerns
the specific portion of the measure at issue relating to the Kor ean investigating authorities'
consideration of the volume of the dumped imports and its alleged inconsistency with Articles 3.1

231 Korea's appellee's submission, para. 170.
232 See para. 5.31 above.
233 See para. 5.29 above. See also Appellate Body Report, US – Countervailing Measures (China),
para. 4.24.
234 Panel Report, para. 7.93 (referring to Japan's first written submission to the Panel, paras. 117, 128,
132-136, and 139-141; second written submission to the Panel, paras. 98-117).
235 See para. 5.33 above.

and 3.2 of the Anti-Dumping Agreement. With regard to volume, Article 3.1 and the first sentence
of Article 3.2 together establ ish a distinct and well -delineated obligation that the investigating
authorities make an objective examination of whether there has been a significant increase in
dumped imports on the basis of positive evidence. Thus, Japan's claim 1 "provide[s] a brief summary
of the legal basis of the complaint sufficient to present the problem clearly" within the meaning of
Article 6.2 of the DSU.
5.79. For the foregoing reasons, we find that the Panel erred in finding that Japan's claim 1,
concerning the volume of the dumped imports, was not within its terms of reference. Consequently,
we reverse the Panel's finding , in paragraphs 7.94 and 8.1.b of the Panel Report, and find that
Japan's claim 1 is within the Panel's terms of reference.
5.3.2.2 Whether the Panel erred in finding that Japan's claim 2 concerning the price
effects of the dumped imports was not within its terms of reference
5.80. Claim 2 in Japan's panel request states that the measure at issue is inconsistent with Korea's
obligations under:
Articles 3.1 and 3.2 of the [Anti-Dumping] Agreement because Korea's analysis of the
effect of the imports under investigation on prices in the domestic market for like
products did not inv olve an objective examination based on positive evidence; and
because Korea failed to properly consider whether the effect of the imports under
investigation was to depress prices to a significant degree or prevent price increase,
which otherwise would have occurred, to a significant degree[.]
5.81. The Panel considered that Japan's panel request concerning the Korean investigating
authorities' price-effects analysis contains two elements, namely: (i) Korea's analysis of the effect
of the imports under investigation on prices in the domestic market for like products did not involve
an objective examination based on positive evidence; and (ii) Korea failed to properly consider
whether the effect of the imports under investigation was to depress prices to a signific ant degree
or prevent price increases, which otherwise would have occurred, to a significant degree.236
5.82. With regard to the first element, the Panel indicated that the claim paraphrases the language
in the first part of Article 3.1 of the Anti-Dumping Agreement and recalled its earlier view that " a
general reference to the language in Article 3.1 in itself is not normally sufficient to present the
problem clearly."237 To the Panel, this formulation d id not explain how or why Japan considers the
measures at issue to be violating the specific WTO obligations in question, including that in
Article 3.1.238
5.83. With regard to the second element, the Panel found that "the claim paraphrases the language
of the second sentence of Article 3.2 [of the Anti -Dumping Agreement ], with two notable
differences."239 First, Japan specifically referred to two of the three price effects mentioned in the
second sentence of Article 3.2 (price suppression and price depression). Second, the use of the word
"properly" indicate d that Japan t ook issue with the manner in which the KTC considered price
suppression and price depression, which would include the extent of the alleged price suppression
and price depression.240 However, the Panel found that Japan's panel request fell short of explaining
"how or why" it considered the KTC's consideration of price suppression and price depression to be
"improper" and consequently inconsistent with Articles 3.1 and 3.2.241 This is because, to the Panel,
the propriety of an investigating authority's consideratio n of complex economic issues is a broad
concept, such that the true nature of the complaint cannot be presented clearly without some
additional identification of the main elements of the alleged violation(s).242

236 Panel Report, para. 7.124.
238 Panel Report, para. 7.125.
239 Panel Report, para. 7.126.
240 Panel Report, para. 7.126.
241 Panel Report, para. 7.126.
242 Panel Report, para. 7.126.

5.84. On appeal, Japan argues that the Panel erred i n finding that its claim under Articles 3.1
and 3.2 of the Anti-Dumping Agreement concerning the price effects of the dumped imports was not
within its terms of reference.243 Japan argues that its claim refers specifically to "Korea's failure 'to
properly consider whether the effect … was to depress prices to a significant degree or prevent price
increase … to a significant degree', and expressly identifie[s] Articles 3.2 and 3.1 as the provisions
at issue."244 However, according to Japan, the Panel failed to consider fully and carefully the "nature
and scope" of this obligation, and failed to consider at all the claim in light of the nature of the
specific measure being challenged.245 Japan further indicates that its claim refers specifically to the
analysis of t he effect of the imports on prices, and that, in light of the nature of the measure at
issue, the Korean investigating authorities should have been fully able to understand this claim.246
Japan also reiterates that the Panel improperly relied on the phrase "how or why"247, and improperly
relied on Japan's arguments in its written submissions.248
5.85. Korea maintains that a general reference to the language in Article 3.1, coupled with a generic
reference to Article 3.2, is insufficient to present the problem clearly and does not inform Korea
about how and why the Korean investigating authorities' analysis in question was supposedly
inconsistent with these provisions. 249 Korea indicates that Japan's claim paraphrases parts of
Article 3.2, but does not state how or why the KTC's consideration was problematic in light of the
different obligations in Article 3.2. Korea therefore argues that the Panel did not fail to consider the
nature of the obligation, and did not ignore the fact that Japan's claim was made pursuant to both
Articles 3.1 and 3.2.250 With regard to the nature of the measure, Korea argues that Japan's panel
request did not specifically provide a narrative that linked particular intermediate findings by the
Korean investigating authorities to the legal provision s allegedly breached.251 Furthermore, Korea
indicates that the Panel did not improperly rely on the term "how or why", but was rather aware of
the distinction between claims and arguments.252 Finally, Korea submits that the Panel correctly took
account of the scope of allegations as presented by Japan in its written submissions to confirm its
determination that Japan's panel request failed to meet the requirements of Article 6.2 of the DSU.253
5.86. The Panel correctly noted that Japan's panel request identifies both Articles 3.1 and 3.2 of the
Anti-Dumping Agreement as the provisions alleged to have been breached. The Panel then divided
Japan's claim into two different "elements" in order to assess its consistency with Article 6.2 of the
DSU, namely one regarding the obligation under Article 3.1 of the Anti -Dumping Agreement, and
the other regarding the obligation under Article 3.2. In assessing the consistency of the claim under
Article 6.2 of the DSU with respect to the first of these "elements", the Panel relied once again on
its earlier finding that merely paraphrasing Article 3.1 of the Anti -Dumping Agreement will not
normally suffice to present the problem clearly.254 However, as indicated above255, whether Japan's
paraphrasing of Article 3.1, together with the remainder of the narrative in the panel request,
complies with the requirements of Article 6.2 should be assessed on a case -by-case basis, taking
into account the specific circumstances of each claim, including the nature of the measure and that
of the obligation alleged to have been breached.
5.87. We note that, with regard to the nature of the measure, Japan's claim refers to "Korea's
analysis of the effect of the imports unde r investigation on prices in the domestic market for like
products" and "whether the effect of the imports under investigation was to depress prices to a
significant degree or prevent price increase, which otherwise would have occurred, to a significant
degree".256 Japan's panel request thus clearly indicates that this claim concerns the specific portion
of the measure at issue that relates to the Korean investigating authorities' consideration of the

243 Japan's appellant's submission, para. 156.
244 Japan's appellant's submission, para. 158.
245 Japan's appellant's submission, para. 159.
246 Japan's appellant's submission, paras. 162 and 164.
247 Japan's appellant's submission, para. 168.
248 Japan's appellant's submission, paras. 169-170.
249 Korea's appellee's submission, para. 230.
250 Korea's appellee's submission, paras. 231-232 and 237.
251 Korea's appellee's submission, para. 242.
252 Korea's appellee's submission, para. 246.
253 Korea's appellee's submission, para. 251.
254 See Panel Report, para. 7.125. See also paras. 5.13 and 5.20 above.
255 See para. 5.15 above.
256 Japan's panel request, claim 2.

price effects of the dumped imports, more precisely signif icant price suppression and price
depression, and its alleged inconsistency with Articles 3.1 and 3.2.
5.88. With regard to the nature of the provisions at issue, the second sentence of Article 3.2
requires an authority to " consider whether there has been a sign ificant price undercutting by the
dumped imports as compared with the price of a like product of the importing Member, or whether
the effect of such imports is otherwise to depress prices to a significant degree or prevent price
increases, which otherwise would have occurred, to a significant degree". Moreover, an investigating
authority's consideration pursuant to Article 3.2 is also subject to the overarching principles, under
Article 3.1, that it be based on positive evidence and involve an objective examination.257
5.89. Thus, similar to the obligation relating to the volume of dumped imports, the second sentence
of Article 3.2, in conjunction with Article 3.1, sets out an obligation that is distinct and well defined,
with, at its core, the requirement to consi der, on the basis of an objective examination of positive
evidence, whether the effect of the dumped imports on domestic prices consists of the economic
phenomena contained therein. For the purpose of Japan's claim 2, such phenomena are significant
price suppression and price depression. Therefore, by identifying the relevant portion of the measure
concerned by this claim, listing Articles 3.1 and 3.2 of the Anti-Dumping Agreement as the provisions
of the covered agreement alleged to have been breached by Korea, and indicating specifically which
of the phenomena in Article 3.2 the claim concerns, Japan's claim, while brief, plainly connects the
challenged measure with the obligation in question.
5.90. We note that the Panel considered certain aspects of the circum stances regarding claim 2 in
its evaluation of the second "element" of Japan's claim. The Panel indicated that "[t]he propriety of
an investigating authority's consideration of complex economic issues is a broad concept", and that
"[t]he true nature of the complaint cannot be presented clearly without some additional identification
of the main elements of the alleged violation(s)."258 The Panel also downplayed the relevance of the
distinction between claims and arguments, noting that "in cases alleging vio lations of provision s
governing complex economic issues such as those in the Anti -Dumping Agreement, in which … the
measures at issue rest on a series of intermediate considerations involving such issues , … the
boundary between a claim and an argument may not be entirely clear."259
5.91. In our view, all the steps of an investigating authority's analysis under Article 3 of the
Anti-Dumping Agreement, leading to its overall determination of injury, are likely to entail a certain
degree of complex economic analysis. At the same time, we recall that Article 6.2 of the DSU requires
only "a brief summary of the legal basis of the complaint sufficient to present the problem clearly".
We do not share the view that, beyond such a brief summary, a panel request must also spe ll out
precisely which elements of the investigating authority's price-effects analysis are concerned by a
claim of inconsistency with Article 3.2. We indicated in section 5.3.2.1 above, concerning Japan's
claim 1, that it was sufficient for Japan to have identified the Korean investigating authorities'
determination with respect to the volume of dumped imports as the specific portion of the measure
concerned for the measure at issue to be plainly connected to the obligations alleged to have been
breached. In our view, the same considerations are valid for Japan's claim 2. By indicating that
"Korea failed to properly consider whether the effect of the imports under investigation was to
depress prices to a significant degree or prevent price increase, which o therwise would have
occurred, to a significant degree ", Japan has identified the Korean investigating authorities'
consideration of significant price suppression and price depression as the specific portion of the
measure concerned and has plainly connected it with Articles 3.1 and 3.2.
5.92. We recall that the Panel relied on the scope of Japan's allegations in its subsequent written
submissions to confirm its finding that claim 2 in Japan's panel request is not sufficient to present
the problem clearly, and therefore not within its terms of reference. However, we observe that these
later allegations, on which the Panel relied, all relate to the different ways in which Japan considers
that the obligation concerned might have been breached by Korea. More specific ally, these
allegations relate to the Korean investigating authorities failure to: (i) examine price comparability
for purposes of examining the price effects 260; (ii) consider the implications of the diverging price

257 Appellate Body Report, China – GOES, para. 130.
258 Panel Report, para. 7.126.
259 Panel Report, para. 7.128.

trends of the dumped imports and domestic like products261; (iii) explain "the reasonable sales price"
methodology used for assessing price suppression 262; (iv) take into account certain facts and
evidence including, in particular, the higher prices of the dumped imports 263; (v) consider whether
the price suppression and price depression were "significant"264; and (vi) conduct a counterfactual
analysis of how the prices and volumes might have been different in the absence of dumping.265
5.93. Therefore, in our view, the different allegations relied on by the Panel elaborate on why Japan
considers the Korean investigating authorities' price -effects analysis to be inconsistent with
Articles 3.1 and 3.2 and, as such, are arguments in support of its claim unde r these provisions. As
we indicated in section 5.1.1 above, the fact that an investigating authority can act inconsistently
with a provision in different ways does not mean that it therefore contains multiple, distinct
obligations, each of which must be sp ecified in a panel request. 266 Indeed, in assessing Japan's
claim 6 under Articles 3.1 and 3.5 of the Anti -Dumping Agreement, the Panel itself acknowledged
that such allegations are "arguments [Japan] made in support of its claims under" Articles 3.1 and
3.2.267 In our view, while the boundary between a claim and an argument need not be rigid 268, it
does not follow that a complainant should, in a panel request, elaborate on the reasons for which it
believes the respondent has breached a provision of the covered a greements beyond what is
required to provide the legal basis of the complaint sufficient to present the problem clearly.269 This
is because Article 6.2 demands only "a brief summary" of the legal basis of the complaint and not
the arguments in support of the complaint.270
5.94. In sum, Japan's claim 2 identifies both Articles 3.1 and 3.2 of the Anti -Dumping Agreement
as the provisions alleged to have been breached. In addition, Japan's panel request indicates that
this claim concerns the specific portion of the measure at issue that relates to the Korean
investigating authorities' consideration of the price effects of the dumped imports, more precisely
significant price suppression and price depression, and its alleged inconsistency with Articles 3.1 and
3.2. With regard to price effects, the second sentence of Article 3.2, in conjunction with Article 3.1,
sets out an obligation that is distinct and well defined, with, at its core, the requirement to consider,
on the basis of an objective examination of positive evidence, whether the effect of the dumped
imports on domestic prices consists of the economic phenomena contained therein, including
significant price suppression and price depression. Therefore, Japan's claim 2 "provide[s] a brief
summary of the legal basis of the complaint sufficient to present the problem clearly" within the
meaning of Article 6.2 of the DSU.
5.95. For the foregoing reasons, we find that the Panel erred in fi nding that Japan's claim 2,
concerning the price effects of the dumped imports, is not within its terms of reference.
Consequently, we reverse the Panel's finding , in paragraphs 7.131 and 8.1.c of the Panel Report,
and find that Japan's claim 2 is within the Panel's terms of reference.
5.3.2.3 Whether the Panel erred in finding that part of Japan's claim 3 concerning the
impact of the dumped imports on the domestic industry was not within its terms of
reference
5.96. Claim 3 in Japan's panel request states that the measure at issue is inconsistent with Korea's
obligations under:
Articles 3.1 and 3.4 of the [Anti-Dumping] Agreement because Korea's analysis of the
impact of the imports under investigation on the domestic industry at issue did not
involve an objective examination based on positive evidence, including an evaluation of

263 See Panel Report, para. 7.130.c and 7.130.d.
264 See Panel Report, para. 7.130.d.ii.
265 See Panel Report, para. 7.130.d.iii.
266 See para. 5.29 above.
267 Panel Report, para. 7.222. See also section 5.3.2.6 below.
268 See Panel Report, para. 7.128.
269 See para. 5.31 above.
270 Emphasis added.

all relevant economic factors and indices having a bearing on the state of the domestic
industry at issue[.]
5.97. The Panel noted that the first part of the above claim paraphrases the first part of Article 3.1
of the Anti-Dumping Agreement.271 Recalling that a general reference to the language in Article 3.1,
in itself, is not normally sufficient to present the problem clearly272, the Panel proceeded to determine
whether the second part of the claim – the assertion of an alleged failure to conduct "an evaluation
of all relevant economic factors and indices having a bearing on the state of the domestic industry
at issue" – complied with the requirements of Article 6.2 of the DSU.273
5.98. Noting that Article 3.4 of the Anti-Dumping Agreement sets forth a mandatory list of factors
that must be evaluated in each case274, the Panel found that the panel request, on its face, suggested
that the failure by the KTC to evaluate one or more of these f actors constitute d a violation of
Articles 3.1 and 3.4. To the Panel, this formulation indicate d "how or why" Japan consider ed the
measures at issue to be inconsistent with the specific WTO obligations in question, namely those in
Articles 3.1 and 3.4 of the Anti-Dumping Agreement.275 Furthermore, the Panel considered that the
"allegations in Japan's [written] submissions that the KTC failed to evaluate two of the specific factors
listed in Article 3.4 (the ability to raise capital or investments, and the mag nitude of the margin of
dumping) may be viewed as arguments seeking to demonstrate the claim set out in the panel
request".276 The Panel therefore found this part of claim 3 to be within its terms of reference.277 This
finding is not challenged on appeal.
5.99. However, the Panel noted that, over the course of the proceedings, Japan advanced three
other allegations of violations of Articles 3.1 and 3.4278, specifically that: (i) the KTC did not establish
a logical link between its findings on the volume and price effects under Article 3.2 and its finding of
adverse impact under Article 3.4; (ii) with respect to certain factors listed in Article 3.4, the KTC
failed to demonstrate any explanatory force of dumped imports for understanding domestic-industry
trends; and (iii) the KTC attached a high degree of importance to the relevant factors highlighting
negative aspects, while disregarding or downplaying without any explanation the factors suggesting
that the Korean industry was not suffering injury.279 The Panel found that the panel request did not
indicate or suggest that Japan's claim regarding Korea's analysis of the impact of the imports under
investigation on the domestic industry extends to include these allegations .280 The Panel found,
accordingly, that Japan's claim concerning the state of the domestic industry, under Articles 3.1
and 3.4, was limited to the allegation that the KTC failed to evaluate two of the specific factors listed
in Article 3.4, but did not include any other allegations.281
5.100. On appeal, Japan argues that the Panel erred in finding that part of its claim under
Articles 3.1 and 3.4 was not within its terms of reference. Japan argues that, even though its claim
expressly identified Articles 3.1 and 3.4 as the provisions at issue 282, the Panel failed to consider
fully and carefully the "nature and scope" of the obligation und er Article 3.4, and instead focused
only on Article 3.1 as a general obligation.283
5.101. Japan also argues that the Panel fail ed to consider the nature of the measure, as its claim
refers specifically to the "analysis of the impact of the imports" 284, and the Kore an investigating
authorities should have been able to fully understand this claim.285 Japan then argues that the Panel

271 Panel Report, para. 7.166.
272 Panel Report, para. 7.167.
273 Panel Report, para. 7.168.
274 Panel Report, para. 7.168 (referring to Panel Reports, Thailand – H-Beams, para. 7.225;
Argentina – Poultry Anti-Dumping Duties, para. 7.314).
277 Panel Report, para. 7.175.
278 Panel Report, para. 7.172.
279 Panel Report, para. 7.172.
280 Panel Report, para. 7.173.
281 Panel Report, para. 7.175.
282 Japan's appellant's submission, para. 210.
283 Japan's appellant's submission, para. 211 (referring to Panel Report, paras. 7.167 and 7.172-7.173).
285 Japan's appellant's submission, para. 218.

improperly relied on the term "how or why". 286 Finally, Japan reiterates that the Panel improperly
relied on Japan's arguments in its written submissions.287
5.102. Korea replies that Article 3.4 is a multifaceted provision that contains many separate yet
interrelated obligations, and requires the complainant to be as precise and specific as possible in
providing a brief summary of the legal basis of the complaint in the panel request.288 To Korea, the
Panel did not ignore the obligation in Article 3.4 to examine the impact of the dumped imports on
the domestic industry.289 Rather, it is the lack of any specific description of the three allegations in
question that led the Panel to consider that the claim failed to explain "the requisite how or why"
pursuant to Article 6.2 of the DSU. 290 Korea also argues that the Panel did not err by failing to
consider the nature of the measure. 291 Korea further argues that the Panel did not improperly rely
on the term "how or why", because it is evident from the Panel Report that the Panel was aware of
the distinction between claims and arguments. 292 Finally, Korea argues that the Panel correctly
examined the panel request on its face to find that the allegations concerning the lack of assessment
of certain injury factors were covered by the language of the panel request, but that three specific
additional claims were not.293
5.103. We indicated in section 5.1.1 above that, in assessing whether a panel request comports
with the requirements of Article 6.2 of the DSU, a panel must examine a panel request on its face,
taking into consideration the circumstances of each case. We also explained that, in order to provide
a brief summary of the legal basis of the complaint sufficient to present the problem clearly, the
panel request must plainly connect the challenged measure with the obligation alleged to have been
breached. In this regard, as we indicated, a complainant must, at a minimum, list the provisions of
the covered agreement alleged to have been breached. However, there may be situations in which
simply referring to these provisions falls short of meeting the legal standard under Article 6.2 of the
DSU, for example, where the provision at issue establishes multiple obligations.294
5.104. We observe that, in the present instance, Japan has identified Articles 3.1 and 3.4 of the
Anti-Dumping Agreement as the provisions alleged to have been breached, such that it meets the
minimum requirement identified above. However, whether the identification of these provisions will
suffice will depend on the particular circumstances at issue. The Panel, as we recall, considered that
three "allegations" raised by Japan under these provisions are outside its terms of reference. To the
Panel, the language in the panel request "does not cover these three additional allegations", and "a
general reference to the language in Article 3.1 in itself is not sufficient to present the problem …
clearly" with respect to these additional allegations. 295 As we indicated in section 5.1.2 above,
however, whether Japan's paraphrasing of Article 3.1, together with the remainder of the narrative
contained in the panel request, complies with the requirements of Article 6.2 should be assessed on
a case-by-case basis, depending on the relevant circumstances relating to each claim.
5.105. We note that Japan challenges under claim 3 only the portion of the measure at issue that
relates to the Korean investigating authorities ' "analysis of the impact of the imports under
investigation on the domestic industry". Thus, similar to claims 1 and 2, Japan's present claim has
identified the specific aspect of the measure at issue with sufficient precision.

286 Japan's appellant's submission, paras. 222-223. To Japan, the Panel's mistaken belief that the use of
this phrase by the Appellate Body obliges the complainant to include arguments in its panel request also
contributed to its incorrect conclusion that only the limited "allegation" concerning the two specific factors (the
ability to raise capital or investments, and the magnitude of the margin of dumping) was properly within its
terms of reference and that all other aspects of Japan's claim regarding Article 3.4 were outside its terms of
reference. (Ibid.)
287 Japan's appellant's submission, paras. 224-228.
288 Korea's appellee's submission, para. 341.
289 Korea's appellee's submission, para. 345.
290 Korea's appellee's submission, para. 346. (emphasis original)
292 Korea's appellee's submission, para. 353.
293 Korea's appellee's submission, para. 359.
294 See para. 5.6 above.
295 Panel Report, para. 7.173.

5.106. Regarding the nature of the provisions, Article 3.4 of the Anti-Dumping Agreement provides:
The examination of the impact of the dumped imports on the domestic industry
concerned shall include an evaluation of all relevant economic factors and indices having
a bearing on the state of the industry, including actual and potential decline in sales,
profits, output, market share, productivity, return on investments, or utilization of
capacity; factors affecting domestic prices; the magnitude of the margin of dumping;
actual and po tential negative effects on cash flow, inventories, employment, wages,
growth, ability to raise capital or investments. This list is not exhaustive, nor can one
or several of these factors necessarily give decisive guidance.
5.107. Article 3.4 thus requires an in vestigating authority to "derive an understanding of
the impact of subject imports", or, in other words, the relationship between the dumped imports
and the state of the domestic industry. 296 For purposes of this inquiry, Article 3.4 requires the
authorities to evaluate "all relevant economic factors and indices having a bearing on the state of
the industry". Article 3.4 "then lists certain factors that 'are deemed to be relevant in every
investigation and which must always be evaluated by the investigating authorities'".297 Moreover,
the examination under Article 3.4 is subject to the "overarching principle" set out in Article 3.1 that
the examination must be "objective" and be based on "positive evidence".298
5.108. Thus, Article 3.4, together with Article 3.1, establishes a distinct obligation that essentially
requires the investigating authorities to examine objectively the impact of the dumped imports on
the domestic industry on the basis of positive evidence concerning all relevant economic factors and
indices having a bearing on the state of the domestic industry. While there may be many factors
informing this assessment, a complainant is not required to identify or otherwise refer to the different
factors that it considers an investigating authority would have failed to consider, or failed to consider
properly. This is because, as indicated in section 5.2.1 above, in order to plainly connect the measure
at issue with the provision alleged to have been breached, a complainant is required to provide only
a brief summary of the legal basis of the complaint, that is, the claim and not arguments in support
thereof.299 In this regard, we agree with the Panel that the "allegations in Japan's [written]
submissions that the KTC failed to evaluate two of the specific factors listed in Article 3.4 (the ability
to raise capital or investments, and the magnitude of the margin of dumping) may be viewed as
arguments seeking to demonstrate the claim set out in the panel request."300
5.109. We do not, however, understand the distinction drawn by the Panel between the "arguments"
pertaining to the above two factors listed in Article 3.4, on the one hand, and the other "allegations"
advanced by Japan under Article 3.4 during the course of the panel proceedings, which the Panel
excluded from its terms of reference, on the other hand. 301 These allegations relate to the Korean
investigating authorities' failure to link their findings on volume and price effects to their examination
of the impact of the dumped imports, failure to demonstrate the explanatory force of the dumped
import for the state of the domestic industry, and disregard of economic factors suggesting a lack
of injury.302 As we see it, the allegations that the Panel found not to be within its terms of reference
describe t he reasons why Japan considers the Korean investigating authorities to have
inappropriately considered the impact of the dumped imports and/or the factors listed in Article 3.4,
contrary to the requirements of objective examination and positive evidence under Article 3.1. Thus,
they serve to explain precisely the manner in which the Korean investigating authorities would have

296 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.205 (quoting
Appellate Body Report, China – GOES, para. 149). (emphasis original)
297 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.203 (quoting
Appellate Body Report, US – Hot-Rolled Steel, para. 194, in turn referring to Appellate Body Report,
Thailand – H-Beams, fn 36 to para. 128).
298 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.203 (referring to
Appellate Body Report, US – Hot-Rolled Steel, paras. 196-197).
299 See para. 5.31 above.
301 See Panel Report, paras. 7.169-7.174. See also para. 5.99 above.
302 See para. 5.99 above. See also Panel Report, para. 7.172. In our view, the first two allegations
concern the alleged failure to assess properly the relationship between the dumped imports and certain
economic factors listed in Article 3.4 for purposes of understanding the impact of such imports, and the third
allegation concerns the respective weight the authorities would have attributed to the factors they had
examined.

breached the single, distinct obligation established by Articles 3.1 and 3.4 of the Anti -Dumping
Agreement.
5.110. In particular, we note th at the second of these allegations is that, with respect to certain
factors listed in Article 3.4, the Korean investigating authorities failed to demonstrate any
explanatory force of dumped imports for understanding domestic-industry trends. We recall that in
China – HP-SSST (Japan) / China – HP-SSST (EU), the Appellate Body indicated:
We do not see, in Japan's panel request, a claim under Articles 3.1 and 3.4 of the
Anti-Dumping Agreement regarding [the Chinese investigating authorities'] alleged
failure to examine whether dumped imports provided "explanatory force" for the state
of the domestic industry. The reference to "explanatory force" is drawn from the
Appellate Body's interpretation of Article 3.4 in its report in China – GOES. This
reference formed part of the Appellate Body's reasoning in interpreting Article 3.4 in
that dispute and should not be read to create an obligation that is distinct from that
expressed in Article 3.4. Accordingly, we view Japan's submissions, insofar as they refer
to "expl anatory force", as setting out arguments, based on the Appellate Body's
reasoning in China – GOES, in support of Japan's claims under Article 3.4. These claims
were properly within the Panel's terms of reference.303
5.111. In sum, Japan's claim 3 identifies the portion of the measure at issue that relates to the
Korean investigating authorities' "analysis of the impact of the imports under investigation on the
domestic industry" and thus identifies with sufficient precision the specific aspect of the measure at
issue. Claim 3 also identifies Articles 3.1 and 3.4 of the Anti-Dumping Agreement as the provisions
alleged to have been breached. Article 3.4, together with Article 3.1, establishes a distinct obligation
that essentially requires the investi gating authorities to examine objectively the impact of the
dumped imports on the domestic industry on the basis of positive evidence concerning all relevant
economic factors and indices having a bearing on the state of the domestic industry. Japan's claim 3
thus "provide[s] a brief summary of the legal basis of the complaint sufficient to present the problem
clearly" within the meaning of Article 6.2 of the DSU. The three allegations that the Panel found to
be outside its terms of reference, like Japan's o ther arguments under claim 3, serve to explain the
manner in which the Korean investigating authorities would have breached the distinct obligation
established by Articles 3.1 and 3.4, such that Japan was not required to include this level of detail
in its panel request.
5.112. For the foregoing reasons, we find that the Panel erred in finding that these three allegations
were not within its terms of reference. We therefore reverse the Panel's finding, in paragraph 7.175
of the Panel Report, that "all other allegations of inconsistency with Article 3.4 argued by Japan are
not properly within the Panel's terms of reference", and, in paragraph 8.1.d of the Panel Report, that
"Japan's claim under Articles 3.1 and 3.4 of the Anti-Dumping Agreement concerning the impact of
the dumped import on the state of the domestic industry" was not within the Panel's terms of
reference, and find the three allegations described above to be within the Panel's terms of
reference.304
5.3.2.4 Whether the Panel erred in finding that Japan's claim 4 was within its terms of
reference
5.113. Claim 4 in Japan's panel request states that the measure at issue is inconsistent with Korea's
obligations under:
Articles 3.1 and 3.5 of the [Anti-Dumping] Agreement because Korea failed to
demonstrate that the imports under investigation were, through the effects of dumping,
causing injury to the domestic industry based on an objective examination of the alleged
causal relationship between the imports under investigation and the all eged injury to

303 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.191. (emphasis
added; fn omitted)
304 The reversal does not concern the Panel's finding, also contained in the above-mentioned
paragraphs, that Japan's allegations that the Korean investigating authorities failed to evaluate two of the
specific factors listed in Article 3.4 (the ability to raise capital or investments, and the magnitude of the margin
of dumping) comply with the requirements of Article 6.2 of the DSU and are within the Panel's terms of
reference, given that this finding is not subject to appeal.

the domestic industry , on the basis of all relevant positive evidence before the
authorities[.]
5.114. The Panel indicated that there are two aspects to Japan's claim, namely that: (i) Korea failed
to conduct an objective examination of the alleged causal relationship on the basis of all relevant
positive evidence before the authorities; and (ii) Korea failed to demonstrate any causal relationship
between the dumped imports and the injury to the domestic industry. The Panel then indicated that,
with regard to the first aspect, a general reference to the language of Article 3.1, in itself, is not
normally sufficient to present the problem clearly. However, the Panel noted that Japan's claim is
qualified by the second aspect, namely, its assertion that Korea failed to demonstrate any causal
relationship between the dumped imports and the injury to the domestic industry on the basis of all
of the evidence before the investigating authority. 305 The Panel recalled that Article 3.5, and
particularly its first sentence, requires the demonstration that the dumped imports are causing injury
to the domestic industry. In the Panel's view, "Japan's presentation of the problem in its panel
request [was] unequivocal" and, "despite its brevity, the panel request [made] it clear that Japan's
claim focuse[d] on the alleged failure to demonstrate" causation. 306 Thus, the Panel found Japan's
formulation to meet the minimum requirement to connect the challenged measure with the
obligation at issue, so that the respondent party and other WTO Members were aware of the nature
of the complaint.307
5.115. The Panel then considered that the allegations raised in Japan's submissions regarding a
lack of correlation in the trends of volumes, prices, and profits could be considered to be arguments
in support of its claim that the Korean investigating authorities failed to demonstrate any causal
relationship between the dumped imports and injury to the domestic industry. 308 Accordingly, the
Panel considered that Japan's claim that the KTC failed to demonstrate any causal relationship
between the dumped imports and the injury to the domestic industry, and thus acted inconsistently
with Articles 3.1 and 3.5 of the Anti-Dumping Agreement, was within its terms of reference.309
5.116. On appeal, Korea argues that claim 4 simply paraphrases the legal obligation of Article 3.5
without explaining how or why Japan considers this obligation to have been breached by Korea310,
and is therefore deficient in providing a summary sufficient to present the problem clearly.311 Korea
argues that Article 3.5 is a multifaceted provision312, but that nothing in Japan's panel request allows
Korea to know which of these legal obligations Japan's complaint is related to and "how and why" it
considered Korea to have acted inconsistently with these legal obligations. 313 To Korea, the Panel
failed to examine the nature of the provision at issue or to explore the way in which the panel request
on its face linked the specific findings of the Korean investigating authorities to one of the many
aspects of the legal obligation of Article 3.5.314
5.117. Japan responds that its claim expressly identifie s Articles 3.1 and 3.5 of the Anti -Dumping
Agreement as the specific provisions at issue, and also identifie s the obligation to make a
determination about causation based on all relevant positive evidence regarding the "causal
relationship".315 Therefore, Japan argues that the language used in claim 4 present s the problem
clearly, in light of the nature and scope of the particular obligations. 316 In response to Korea's
argument that Article 3.5 is multifaceted, Japan indicates that this is precisely why Japan presented
three distinct claims under Article 3.5 in its panel request. Given that Japan's other two causation

305 Panel Report, paras. 7.232-7.233.
306 Panel Report, para. 7.233.
307 Panel Report, para. 7.233.
308 Panel Report, para. 7.234.
309 Panel Report, para. 7.235.
310 Korea's other appellant's submission, para. 60.
311 Korea's other appellant's submission, para. 62.
312 Korea indicates in this regard that the provision requires an investigating authority to: demonstrate
that "dumped" imports caused injury; demonstrate that the dumped imports caused injury "through the effects
of dumping"; demonstrate that a "causal" relationship exists between the dumped imports and the injury;
examine "all … relevant" evidence that was properly "before the authorities"; also examine "any known factors
other than the dumped imports"; and not "attribute" injuries caused by these other factors to the dumped
imports. (Korea's other appellant's submission, para. 64)
313 Korea's other appellant's submission, para. 64.
314 Korea's other appellant's submission, para. 64.
315 Japan's appellee's submission, para. 28.
316 Japan's appellee's submission, para. 29.

claims (claims 5 and 6) focus on different aspects of Article 3.5, Japan submits that it is hard to see
how Korea could have been confused about the separate scope of Japan's claim 4 about "causal
relationship".317
5.118. We indicated in section 5.1.1 above that in assessing whether a panel request comports with
the requirements of Article 6.2 of the DSU, a panel must examine a panel request on its face, taking
into consideration the circumstances of each case. We also indicated that, in order to provide a brief
summary of the legal basis of the complaint sufficient to present the problem clearly, the panel
request must plainly connect the challenged measure with the obligation alleged to have been
breached. In this regard, a complainant must, at a minimum, list the provisions of the covered
agreement alleged to have been breached, although there may be situations in which simply
referring to these provisions falls short of meeting the legal standard under Article 6.2 of the DSU,
for example, where the provision at issue establishes multiple obligations.318
5.119. With regard to claim 4, although the Panel began by stating that "a general reference to the
language of Article 3.1 in itself is not normally sufficient to present the problem clearly"319, the Panel
did not end its analysis there. Rather, the Panel went on to analyse the relevant circumstances of
this claim. The Panel observed that claim 4, on its face, contains two aspects, and that the first
aspect – relating to the alleged failure to conduct an objective examination on the basis of positive
evidence – is qualified by the second aspect, that is, the assertion that Korea failed to demonstrate
any causal relationship. The Panel then analysed the nature of the obl igation regarding the
demonstration of the causal relationship established by Article 3.5 and noted that Japan's panel
request "unequivocal[ly]" presents the "problem" as one that relates to the failure to demonstrate
this causal relationship.320
5.120. In our view, the Panel's analysis reflects its consideration of both the nature of the measure
and that of the obligation at issue consistently with the applicable standard under Article 6.2 of the
DSU. We observe that Japan's claim 4 relates specifically to the Kor ean investigating authorities'
alleged failure "to demonstrate that the imports under investigation were … causing injury to the
domestic industry". The relevant aspect of the measure at issue concerned by this claim thus relates
to the demonstration of causation.
5.121. With regard to the nature of the provisions, Article 3.5 of the Anti -Dumping Agreement
provides that:
It must be demonstrated that the dumped imports are, through the effects of dumping,
as set forth in paragraphs 2 and 4, causing injury within the meaning of this Agreement.
The demonstration of a causal relationship between the dumped imports and the injury
to the domestic industry shall be based on an examination of all relevant evidence
before the authorities. The authorities shall also examine any known factors other than
the dumped imports which at the same time are injuring the domestic industry, and the
injuries caused by these other factors must not be attributed to the dumped imports.
Factors 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 practices of and competition between the foreign and
domestic producers, developments in technology and the export performance and
productivity of the domestic industry.
5.122. Thus, Article 3.5, together with Article 3.1, establishes obligations that are multilayered.
First, it "must be demonstrated that the dumped imports are, through the effects of dumping, as set
forth in paragraphs 2 and 4, causing injury within the meaning of this Agreement", a demonstration
that "shall be based on an examination of all relevant evidence before the authorities". In addition,
in situations where dumped imports and other known factors are causing injury to the domestic
industry at the same time, the investigating authority must undertake the non -attribution analysis
set out in Article 3.5. This non-attribution analysis may include the factors listed in the latter part of

317 Japan's appellee's submission, para. 30.
318 See para. 5.6 above.
319 Panel Report, para. 7.233.
320 Panel Report, para. 7.233.

Article 3.5. For these reasons, we agree with Korea that that Articles 3.5 is a "multi -faceted
provision".321 At the same time, we note that Japan agrees with this proposition.322
5.123. As Japan explains, it presents three claims under Articles 3.1 and 3.5, each with its distinct
scope. Japan's claim 4, on its face, is about the alleged failure to demonstrate the causal relationship
on the basis of an "objective examination" and "all relevant … evidence before the authorities"323 as
required under Article 3.5, in particular its second sentence, as well as under Article 3.1. As further
discussed below 324, claim 5 concerns the alleged inconsistency of the Korean investigating
authorities' non-attribution analysis, and claim 6 concerns the alleged flaws in price effects, volume,
and impact analysis that independently undermined the Korean investigating authorities' causation
determination. Thus, we do not share Korea's view that "[n]othing in Japan 's panel request allows
Korea to know which of these legal obligations [under Article 3.5] Japan's complaint is related to."325
5.124. Our above analysis thus indicates that Japan has specified in the narrative of its claim which
aspect of Articles 3.1 and 3.5 of the Anti-Dumping Agreement the present claim concerns, together
with the relevant aspect of the measure at issue. Japan's claim, while brief, has plainly connected
the challenged measure with the provision alleged to have been breached such that Japan's claim 4
complies with the requirements of Article 6.2 of the DSU.
5.125. To the extent that Korea suggests that something more would have been required in the
panel request to indicate "how or why" Japan argues that the Korean investigating authorities are
alleged to have breached the requirement in Article 3.5326, we understand Korea to be requesting
further elaboration explaining the alleged violation. However, as we indicated in section 5.2.1 above,
in order to plainly connect the measure at issue with the provision alleged to have been breached,
a complainant is required to provide only the legal basis, that is, the claim, underlying its complaint
and not arguments in support of this claim. 327 For these reasons, we agree with the Panel that the
allegations raised in Japan's submissions – a lack of correlation in the trends of volumes, prices, and
profits – can be considered arguments in support of its claim that the Korean investigating authorities
failed to demonstrate any causal relationship between the dumped imports and injury to the
domestic industry.328
5.126. In sum, Japan's claim 4 identifies Articles 3.1 and 3.5 of the Anti -Dumping Agreement as
the provisions alleged to have been breached, and re lates specifically to the Korean investigating
authorities' alleged failure to demonstrate that the imports under investigation were causing injury
to the domestic industry. While Article 3.5, together with Article 3.1, establishes obligations that are
multilayered, Japan has indicated which aspect of the obligations set forth in Articles 3.1 and 3.5 is
alleged to have been breached. Japan's claim 4, on its face, is about the alleged failure to
demonstrate the causal relationship on the basis of an "objecti ve examination" of "all relevant …
evidence before the authorities" as required under Article 3.5, in particular its second sentence, as
well as under Article 3.1. Thus, Japan's claim 4 "provide[s] a brief summary of the legal basis of the
complaint sufficient to present the problem clearly" within the meaning of Article 6.2 of the DSU.
5.127. For the foregoing reasons, we find that the Panel did not err in finding that Japan's claim 4
was within its terms of reference. Consequently, we uphold the Panel's finding in paragraphs 7.235
and 8.2.c of the Panel Report.
5.3.2.5 Whether the Panel erred in finding that part of Japan's claim 5 was within its
terms of reference
5.128. Claim 5 in Japan's panel request states that the measure at issue is inconsistent with Korea's
obligations under:

321 Korea's other appellant's submission, para. 64.
322 Japan's appellee's submission, para. 30.
323 Japan's panel request, claim 4; Article 3.5 of the Anti-Dumping Agreement, second sentence.
324 See sections 5.3.2.5 and 5.3.2.6 below.
325 Korea's other appellant's submission, para. 64.
326 Korea's other appellant's submission, para. 64.
327 See para. 5.31 above.
328 Panel Report, para. 7.234.

Articles 3.1 and 3.5 of the [Anti-Dumping] Agreement because Korea failed to consider
adequately all known factors other than the imports under investigation that were
injuring the domestic industry at the same time and therefore incorrectly attributed
injury caused by these other factors to the imports under investigation[.]
5.129. The Panel found that the panel request provide d a brief explanation of how or why Japan
considers the measure at issue to be violating the specific WTO obligations in question, with respect
to the alleged failure of the Korean investigating authorities to exami ne certain known factors
adequately.329 In this context, the Panel considered that the allegations in Japan's submissions that
the Korean investigating authorities considered three known factors other than the dumped imports
that could be injuring the domestic industry in isolation, and yet failed to examine them adequately,
may be seen as arguments seeking to demonstrate the claim set out in the panel request.330 Korea
appeals these findings of the Panel.331
5.130. Korea submits that, contrary to what the Panel found with respect to many of the other
claims presented in Japan's panel request, the Panel effectively considered that, for claim 5, it
suffices to paraphrase the obligation contained in the relevant provisions to meet the requirements
of Article 6.2 of the DS U.332 In Korea's view, "[t]here was no narrative explanation of any kind in
Japan's panel request that would allow Korea, third parties or the Panel … to understand the nature
and scope of this claim."333 Korea, therefore, argues that the Panel's findings reveal an error of law
in the manner in which the Panel applied the requirements of Article 6.2 of the DSU to the facts of
this case, as well as internal contradictions and inconsistencies that violate th e requirements of
Article 11 of the DSU.334
5.131. Japan responds that the language used in claim 5 presents the problem clearly in light of
the nature and scope of the obligations at issue. Japan maintains that claim 5 draws on the specific
language from the third sentence of Article 3.5, and makes it clear that this claim concerns the
inconsistency of the measure at issue with the obligation to "examine any known factors other than
the dumped imports which at the same time are injuring the domestic industry" and to ensure that
such injury is not attributed to the dumped imports.335 In response to Korea's argument that there
was no narrative explanation of any kind in Japan's panel request, Japan argues that each of its
three causation claims addressed a particular el ement of Articles 3.1 and 3.5. As such, given that
there are two other claims addressing causation, Japan argues that "it is hard to see why Korea was
confused about the separate scope of Japan's claim 5 concerning other factors and
non-attribution."336
5.132. Japan's claim 5, similar to its claim 4, concerns the determination of causation by the Korean
investigating authorities within the meaning of Article 3.5 of the Anti -Dumping Agreement. Unlike
claim 4, however, claim 5 relates to a specific aspect of the causa tion determination, namely the
Korean investigating authorities' examination of the non -attribution factors. As we indicated in
paragraph 5.122 above, Article 3.5, together with Article 3.1, establishes obligations that are
multilayered. However, in the narrative of its claim, by challenging the failure "to consider
adequately all known factors other than the imports", Japan has also identified precisely which aspect
of the provisions its claim concerns, namely the requirement not to attribute to the dumped imports
the injuries caused by any known factors other than the dumped imports. Thus, by identifying the
specific aspects of both the measure at issue and the prov ision concerned, Japan's claim 5 plainly
connects the challenged measure with the provisions of the covered agreements alleged to have
been breached, thereby providing a brief summary of the legal basis of its complaint sufficient to
present the problem clearly.

329 Panel Report, paras. 7.240-7.241.
330 Panel Report, para. 7.241.
331 The Panel found, however, that claim 5 "does not extend to cover the allegation that the KTC failed
to consider some known factors at all" because, in the Panel's view, nothing in the panel request hints that the
KTC failed to consider any known factors causing injury. (Panel Report, para. 7.242 (emphasis original)) This
finding is not subject to appeal.
332 Korea's other appellant's submission, paras. 34 and 68.
333 Korea's other appellant's submission, para. 68.
334 Korea's other appellant's submission, para. 35. See also section 5.3.2.7 below.
335 Japan's appellee's submission, para. 37.
336 Japan's appellee's submission, para. 39.

5.133. To the extent that Korea suggests that something more would have been required in the
panel request to indicate how or why Japan alleges that the Korean investigating authorities
breached the non -attribution requirement in Article 3.5, we understan d Korea to be requesting
further elaboration on the reasons for the alleged violation. For example, Korea contends that
Japan's claim, as described in the panel request, does not explain whether the claim "was focused
on an allegation/claim of not examining other factors at all; or, of not examining certain factors that
were known in an adequate manner …; or, of a failure to conduct an adequate examination of the
impact of the known factors". 337 However, narrations of this kind appear to concern the different
ways in which the Korean investigating authorities may have breached the obligation and would
have required Japan to substantiate its claim with arguments in the panel request. This, however,
is not required under Article 6.2 of the DSU.338 For the same reasons, we agree with the Panel that
the allegations in Japan's written submissions, that the Korean investigating authorities considered
three known factors other than the dumped imports that could be injuring the domestic industry in
isolation and failed to examine them adequately, may be seen as arguments seeking to substantiate
the claim set out in the panel request.339
5.134. Finally, we recall that the Panel found other allegations raised by Japan under claim 5 not to
be within the scope of its terms of reference, namely that the Korean investigating authorities failed
to consider some known factors at all.340 Given that neither participant has appealed this aspect of
the Panel Report, we do not address the Panel's findings concerning these allegations.
5.135. In sum, Japan's claim 5 identifies Articles 3.1 and 3.5 of the Anti -Dumping Agreement as
the provisions alleged to have been breached and relates to a specific aspect of the causation
determination, namely the Korean investigating authorities' examination of the non -attribution
factors. While Articles 3.1 and 3.5 establish obligations that are multilayered, Japan has identified
which aspect of the provisions its claim concerns, namely t he requirement not to attribute to the
dumped imports the injuries caused by any known factors other than the dumped imports. Thus,
Japan's claim 5 "provide[s] a brief summary of the legal basis of its complaint sufficient to present
the problem clearly" within the meaning of Article 6.2 of the DSU.
5.136. For the foregoing reasons, we find that the Panel did not err in finding that part of Japan's
claim 5, with regard to Korea's alleged failure to consider adequately all known factors other than
the dumped imports as causing injury, was within its terms of reference. Consequently, we uphold
the Panel's finding , in paragraphs 7.241 and 8.2.d of the Panel Report, that Japan's claim under
Articles 3.1 and 3.5 of the Anti-Dumping Agreement, insofar as it relates to the alleged failure of the
Korean investigating authorities to examine certain known factors adequately and their examination
of those factors in isolation, is properly within the Panel's terms of reference.341
5.3.2.6 Whether the Panel erred in finding that Japan's claim 6 was within its terms of
reference
5.137. Claim 6 in Japan's panel request states that the measure at issue is inconsistent with Korea's
obligations under:
Articles 3.1 and 3.5 of the [Anti-Dumping] Agreement because Korea's demonstration
of causation lacks any foundation in its analyses of the volume of the imports under
investigation, the effects of the imports under investigation on prices, and/or the impact
of the imports under investigation on t he domestic industry at issue, irrespective and
independent of whether Korea's flawed analysis of the volume and/or flawed analysis
of the effects of the imports under investigation on prices, on the one hand, and Korea's
flawed analysis of the impact of t he imports under investigation on the domestic

337 Korea's other appellant's submission, para. 70.
338 See para. 5.31 above.
339 Panel Report, para. 7.241.
340 Panel Report, para. 7.242.
341 Our upholding of the Panel's above finding does not concern the Panel's finding, contained in
paragraph 7.243, that "[a]ny other allegations in this regard are not within the Panel's terms of reference",
given that such finding is not subject to appeal.

industry on the other, would be inconsistent with, respectively, Articles 3.1 and 3.2 of
the AD Agreement and Articles 3.1 and 3.4 of the AD Agreement[.]
5.138. The Panel noted that, "[o]n its face, Japan's panel req uest allege [d] that Korea's
demonstration of causation lack [ed] any foundation in its analyses of volume of dumped imports,
effects of imports on prices, and the impact of those imports on the domestic industry."342 The Panel
recalled the requirement under Article 3.5 that an investigating authority demonstrate that the
dumped imports are, through the effects of dumping as set forth in Articles 3.2 and 3.4, causing
injury. Thus, the Panel considered:
[T]he narrative in Japan's panel request, albeit brief, [was] sufficiently precise on its
face to present the problem clearly, namely that, in Japan's view, the KTC's causation
determination [was] undermined by certain aspects of its volume, price effects, and
impact analyses whether or not those aspects [were] inconsistent with Article 3.1, 3.2,
or 3.4 of the Anti-Dumping Agreement.343
5.139. The Panel then addressed Korea's argument that the term "irrespective and independent" in
Japan's panel request made it unclear whether it set forth a new "claim" and , if so, what the legal
basis of this claim would be. The Panel indicated that this claim was independent in nature . The
Panel explained that, if it were to find that the Korean investigating authorities' consideration of
volume and price effects and examination of impact were inconsistent with Articles 3.1, 3.2,
and/or 3.4, such inconsistencies would support finding a consequential violation of Articles 3.1
and 3.5, and there would be no need to go on to consider Japan's independent claim of inconsistency
with Articles 3.1 and 3.5. However, if the Panel were to reject all of Japan's allegations of
inconsistency under Articles 3.1, 3.2, and 3.4, in light of the term "irrespective and independent",
the Panel would need to go on to examine whether the KTC's determination of a causal relationship
was inconsistent with Article 3.5 because of the alleged flaws in the KTC's analysis of volume, price
effects, and impact in that determination .344 The Panel noted that the nature of the independent
claim in the latter decision scenario was "less evident", but that it could not preclude the possibility
that an investigating authority's determination of causation may be inconsistent with Article 3.5 due
to inadequacies in its analysis of the volume, price effects, or impact of dumped imports, even if
these d id not demonstrate a violation of Articles 3.2 and/or 3.4.345 The Panel thus understood
Japan's claim to "rest on the following premises":
a. certain aspects of the KTC's volume, price effects, and impact analyses were "flawed";
b. these "flaws" were either unrelated to the obligations under Articles 3.1, 3.2, and 3.4, or
did not, in themselves, constitute violations of Articles 3.1, 3.2, and 3.4; and
c. these "flaws" nevertheless have a sufficient impact on the KTC's causation determination
to require the conclusion that the determination is inconsistent with Articles 3.1 and 3.5.346
5.140. The Panel then sought to confirm its above analysis by reviewing Japan's subsequent
submissions. On the basis of its review, the Panel considered it "clear" that Japan had asserted "an
independent claim that aspects of the KTC's consideration of the volume and price effects, and
examination of the impact, of dumped imports preclude the finding of a causal relationship
consistently with Articles 3.1 and 3.5 of the Anti-Dumping Agreement".347
5.141. On appeal, Korea argues that Japan's claim is "unclear at even the most general level and
was therefore clearly insufficient to present the problem clearly i n order to allow Korea to start
preparing its defense".348 Korea contends that the Panel did not engage in any analysis, but made a
conclusory finding349 and developed its own theory about what Japan's "independent claim" could

342 Panel Report, para. 7.218.
343 Panel Report, para. 7.218.
344 Panel Report, para. 7.219.
345 Panel Report, para. 7.221.
346 Panel Report, para. 7.221.
347 Panel Report, para. 7.226.
348 Korea's other appellant's submission, para. 74.
349 Korea's other appellant's submission, paras. 24-25 (referring to Panel Report, para. 7.128).

mean.350 Noting that the Panel found Japan's claim to rest on a number of "premises", Korea submits
that none of these premises are referenced in Japan's claim 6.351 In particular, the Panel considered
Japan's panel request to allege certain "flaws" in the Korean investigating authorities' volume, price
effects, and impact analyses, and, not knowing from the panel request what they are, the Panel
considered it necessary to "confirm" its understanding of the nature of Japan's claim by reviewing
Japan's written submissions.352 However, the Panel found no new, separate, or additional arguments
in the submissions other than the ones referring back to Japan's arguments relating to the claims
under Articles 3.1, 3.2, and 3.4, which contradicts Japan's assertion of an "independent" claim. 353
Korea furthermore reiterates that there is no explanation of the "how or why" of this allegedly
independent causation claim in the panel request, and Japan was effectively again paraphrasing the
obligation in Article 3.5.354
5.142. Japan responds that claim 6 is properly within the Panel's terms of reference. Japan suggests
that, as each of its causation claims refers to one specific obligation within Articles 3.1 and 3.5 of
the Anti-Dumping Agreement, there is no ambiguity or misunderstanding, and each claim presents
the problem clearly given the nature and scope of the obligations.355 To Japan, when compared with
claims 4 and 5, it is clear that claim 6 focuses on a different obligation, that is, the ultimate conclusion
of causation, and whether this conclusion had a foundation in the underlying facts about volume,
price effects, and impact on the domestic industry.356 Japan then argues that this claim "makes quite
explicit that it is not just a consequential claim". 357 Further, Japan indicates that its claim plainly
connects the measure at issue to the alleged inconsistency such that Korea should have been able
to understand the claim fully.358 Finally, Japan submits that the Panel's determination that the claim
was within its terms of reference was based on the language of the panel request, and not on any
subsequent submissions by Japan, and the fact that the Panel examined Japan's subsequent
submissions does not mean that the problem was not presented in a sufficiently clear form in the
panel request.359
5.143. Japan's claim 6, similar to its claims 4 and 5 discussed above, concerns a specific aspect of
the Korean measure, namely the determination of causation by the Korean investigating authorities
within the meaning of Article 3.5 of the Anti-Dumping Agreement. At the same time, unlike claims 4
and 5, the plain wording of claim 6 indicates that this claim concerns more specifically the alleged
"lack[]" of "foundation" for the causation determination in the Korean investigating authorities'
volume, price effects, and impact analyses.
5.144. As indicated in paragraph 5.122 above, Articles 3.1 and 3.5 of the Anti-Dumping Agreement
establish obligations that are multilayered. However, Japan has identified in the narrative of its claim
the particular aspect of the provisions its claim relates to. By indicating that "Korea's demonstration
of causation lacks any foundation in its analyses of the volume of the imports under investigation,
the effects of th e imports under investigation on prices, and/or the impact of the imports under
investigation on the domestic industry at issue", Japan's claim 6 relates to the demonstration of the
causal relationship between the dumped imports and the domestic industry as provided in the first
sentence of Article 3.5. The wording of claim 6 also indicates that this claim is brought "irrespective
and independent of" whether s uch "flawed" volume, price effects, and impact analyses would be
inconsistent with Articles 3.1, 3.2, and 3.4.
5.145. Thus, the reference to Articles 3.1 and 3.5, along with the narrative of claim 6 on its face,
identifies with sufficient precision which part of Articles 3.1 and 3.5 Japan's claim 6 concerns, so as

350 Korea's other appellant's submission, para. 25.
351 Korea's other appellant's submission, para. 26 (quoting Panel Report, para. 7.221). See also ibid.,
para. 78.
352 Korea's other appellant's submission, para. 26. See also ibid., paras. 80-81.
353 Korea's other appellant's submission, para. 27. See also ibid., para. 82.
354 Korea's other appellant's submission, para. 84.
355 Japan's appellee's submission, para. 47.
356 Japan's appellee's submission, para. 48.
357 Japan's appellee's submission, para. 49. (emphasis original)
358 Japan's appellee's submission, para. 52 (referring to OTI's Final Report (Panel Exhibit KOR-2b (BCI)),
pp. 80-84).
359 Japan's appellee's submission, para. 54. Japan indicates that Korea takes issue with the manner in
which Japan presented arguments in support of its claim, but in doing so, Korea confuses the distinction
between the "brief summary" of the claim and the arguments in support of that claim. (Ibid., para. 55)

to meet the minimum requirement under Article 6.2 of the DSU. We therefore share the Panel's view
that "the narrative in Japan's panel request, albeit brief, is sufficiently precise on its face to present
the problem clearly, namely that, in Japan's view, the KTC's causation determination is undermined
by certain aspects of its volume, price effects, and impact analyses whether or not those aspects
are inconsistent with Article 3.1, 3.2, or 3.4 of the Anti-Dumping Agreement."360
5.146. Korea argues that the Panel itself was uncertain as to the precise nature of Japan's claim 6
and developed its own theory regarding the "premises" underlying Japan's claim. 361 As we see it,
however, in the findings referred to by Korea 362, the Panel was responding to Korea's argument
regarding the alleged ambiguity of the term "irrespective and independent" in Japan's panel request.
Specifically, the Panel explained its understanding of this phrase and its implications for the
resolution of the "independent" claim, in light of the possible outcome of the claims under Articles 3.2
and 3.4 of the Anti -Dumping Agreement. According to the Panel, if the claims under Articles 3.2
and 3.4 were to result in findings of inconsistency, there would b e no need to examine claim 6
further, given that a consequential violation of Article 3.5 would flow from such findings of
inconsistency. In contrast, if there were to be no findings of inconsistency under Articles 3.2 and 3.4,
the Panel considered that it would need to examine claim 6 precisely because, according to the panel
request, this claim is raised regardless of whether an inconsistency with Articles 3.2 and 3.4 was
found to exist and is, in that sense, "independent". It was in this context that the Panel indicated
that the nature of the independent claim may be "less evident" in comparison to a consequential
claim, and explained what it regarded as the "premises" of Japan's claim. 363 In other words, the
"contingent" nature of claim 6 that the Panel re ferred to concerns the uncertainty as to how the
claim would be resolved, rather than the uncertainty inherent in the text of the panel request.
5.147. In any event, we observe that these considerations are not essential for the assessment of
the consistency of t he claim with the requirements of Article 6.2 of the DSU. Whether a claim is
related to, contingent on, or independent from another claim does not detract from the requirement
under Article 6.2 of the DSU to consider a panel request on its face to determine whether it provides
the legal basis of the complaint sufficient to present the problem clearly. In our view, the
consideration of the interrelationship between claims is one that pertains more to the merits of these
claims. In this regard, we recall that the Appellate Body indicated in Australia – Apples that, "[f]or
a matter to be within a panel's terms of reference—in the sense of Articles 6.2 and 7.1 of the DSU—
a complainant must identify 'the specific measures at issue' and the 'legal basis of the com plaint
sufficient to present the problem clearly'" 364, and that, by contrast, "the question of whether the
measures identified in the panel request can violate, or cause the violation of, the obligation … is a
substantive issue to be addressed and resolved on the merits."365
5.148. Korea also maintains that, due to the use of the phrase "lacks any foundation" in Japan's
claim 6, the only kinds of claims and arguments that can fall within the purview of Japan's claim 6
are claims and arguments that the KTC's causation analysis was not based at all on its own volume,
price effect, or impact analyses. Yet Japan has raised no such claims or arguments. 366 We note,
however, that, in order to reach this understanding of Japan's claim, Korea must read in isolation
the phrase "lacks any foundation". As we indicated, the Panel properly assessed the narrative in
Japan's claim 6 by considering it in its totality and by relying on the above -referenced "premises",
such that a reading of this claim, as a whole, does not support Korea's understanding.
5.149. Finally, Korea contends that the Panel erred by relying on Japan's subsequent submissions
to confirm its above understanding regarding the nature of the independent claim367, and thus failed
to adhere to the principles that the panel request must be examined on its face as it existed at the
time of filing, and that any defects in the panel request cannot be cured in subsequent submissions
during the panel proceedings.368 We recall that, according to the Panel, the various arguments raised

360 Panel Report, para. 7.218.
361 Korea's other appellant's submission, paras. 77-78 (referring to Panel Report, para. 7.221).
362 See Panel Report, paras. 7.219-7.221.
363 Panel Report, para. 7.221.
364 Appellate Body Report, Australia – Apples, para. 423.
365 Appellate Body Report, Australia – Apples, para. 425. (emphasis original)
366 Korea's other appellant's submission, para. 88.
367 Korea's other appellant's submission, paras. 80-81.
368 Korea's other appellant's submission, para. 81 (referring to Appellate Body Report, US – Carbon
Steel, para. 127).

by Japan in support of claim 6 concern a number of "elements" in the Korean investigating
authorities' volume, price -effects, and impact analys es that "disprove" the existence of a causal
relationship.369 The Panel therefore considered it "clear" tha t Japan has asserted an independent
claim under Articles 3.1 and 3.5.370 In our view, therefore, the Panel consulted Japan's subsequent
submissions, not to "cure" an alleged defect in Japan's panel request, but merely to confirm its
understanding of Japan's panel request on the basis of its text, in accordance with the requirements
of Article 6.2 of the DSU.
5.150. In sum, Japan's claim 6 identifies Articles 3.1 and 3.5 of the Anti -Dumping Agreement as
the provisions alleged to have been breached, and concerns a specific aspect of the Korean measure,
namely the determination of causation by the Korean investigating authorities within the meaning
of Article 3.5. While Articles 3.1 and 3.5 establish obligations that are multilayered, Japan has
identified in the narrative of its claim the particular aspect of the provisions its claim relates to. By
indicating that "Korea's demonstration of causation lacks any foundation in its analyses of the volume
of the imports under investigation, the effects of the imports under in vestigation on prices, and/or
the impact of the imports under investigation on the domestic industry at issue", Japan's claim 6
indicates that it takes issue with the demonstration of the causal relationship between the dumped
imports and the domestic industry as provided in the first sentence of Article 3.5 of the Anti-Dumping
Agreement. Thus, the Panel rightly took the vi ew that the narrative in Japan's panel request is
sufficiently precise to present the problem clearly. In addition, whether a claim is related to,
contingent on, or independent from another claim does not detract from the requirement under
Article 6.2 of the DSU to consider the panel request on its face to determine whether it provides the
legal basis of the complaint sufficient to present the problem clearly.
5.151. For the foregoing reasons, we find that the Panel did not err in finding that Japan's claim 6
was within its terms of reference. Consequently, we uphold the Panel's finding in paragraphs 7.226
and 8.2.b of the Panel Report.
5.3.2.7 Whether the Panel acted inconsistently with Article 11 of the DSU in assessing
the consistency of Japan's panel request with Article 6.2 of the DSU
5.152. Korea claims on appeal that, in reaching its findings under Article 6.2 of the DSU regarding
Japan's claims under Articles 3.1 and 3.5 of the Anti-Dumping Agreement, the Panel failed to conduct
an "objective assessment of the matter" as required by Article 11 of the DSU. Korea argues that
"[t]he Panel failed to provide an adequate and reasoned explanation supporting its finding that the
paraphrasing of the obligations under Articles 3.1 and 3.5 of the Anti-Dumping Agreement sufficed
to present the problem clearly, when that same paraphrasing was not considered to be sufficient in
the context of most of the other claims included in Japan's panel request."371 To Korea, "[t]he Panel's
application of the standard [under] Article 6.2 of the DSU t o the facts in the context of the three
causation claims [is] internally inconsistent and not supported by coherent reasoning" 372, and
reflects "an inappropriate desire on the part of the Panel to salvage at least some of Japan's
claims".373 In contrast, Korea argues that the Panel "correctly made the exact opposite findings in
the context of all other claims it rejected under Article 6.2 DSU".374
5.153. Japan replies that the Panel's finding that the causation claims under Articles 3.1 and 3.5 of
the Anti-Dumping Agreement were within its terms of reference is correct and does not reflect the
lack of an objective assessment. To Japan, Korea's suggestion that the Panel was internally
incoherent and inconsistent is "really just repackaging Korea's objection t o the merits of what the

369 Panel Report, paras. 7.223-7.225.
370 Panel Report, para. 7.226.
371 Korea's other appellant's submission, para. 261.
372 Korea's other appellant's submission, para. 261. For instance, Korea notes that the Panel "noted the
high degree of 'succinctness', acknowledged that the problem was not presented clearly as it was required to
seek 'confirmation' in the written submissions, expressed its own uncertainty about the meaning of the
'independent' nature of the third causation claim and generally failed to provide any explanation of why
paraphrasing the obligations under Articles 3.1 and 3.5 was sufficient to present the problem clearly" when it
reached "the exact opposite conclusion with respect to, for example the claims under Articles 3.1 and 3.2
or 6.9 of the Anti-Dumping Agreement". (Ibid.)
373 Korea's other appellant's submission, para. 262.
374 Korea's other appellant's submission, para. 262.

Panel found".375 Japan submits that "the mere fact that the Panel reached different conclusions on
different issues does not establish a violation of Article 11 of the DSU."376 Moreover, "[e]ven if the
Panel made one or more errors that reflected the Panel's misunderstanding of Article 6.2 of the DSU,
those errors do not establish the lack of an objective assessment of the matter." 377 Japan further
argues that Korea's position is "rather extreme" since it "goes so far as to argue that none of Japan's
claims should have been found to be within the terms of reference".378
5.154. Article 11 of the DSU imposes on panels an obligation to "make an objective assessment of
the matter before it, including an objective assessment of the facts of the case and the applicability
of and conformity with the relevant covered agreements". In certain disputes, panels have been
found to breach their obligations under Article 11 of the DSU due to their internally inconsistent
reliance on, or examination of, the evidenc e before them. 379 Furthermore, the Appellate Body
indicated that a claim that a panel has acted inconsistently with its obligations under Article 11 of
the DSU is a "serious allegation"380 that impugns a panel's assessment of its jurisdiction381, and that
must stand on its own rather than being made as a subsidiary argument in support of a claim that
a panel erred in its application of a WTO provision.382
5.155. In the present dispute, the Panel found that, with respect to Japan's claims under
Articles 3.1, 3.2, 3.4, 4.1, and 6.9 of the Anti -Dumping Agreement, by merely paraphrasing the
provisions concerned, Japan's panel request was not sufficient to meet the requirements of
Article 6.2 of the DSU. Korea takes issue with the fact that , when the Panel applied the same
provision of the DSU to assess the sufficiency of Japan's panel request with respect to its claims
under Articles 3.1 and 3.5, the Panel found that merely paraphrasing these provisions was sufficient
to meet the requirements of Article 6.2. Korea therefore arg ues that the Panel's reasoning is
internally incoherent and inconsistent.
5.156. Thus, Korea's challenge is not directed at the Panel's alleged inconsistency in the
appreciation of evidence, but rather at its alleged inconsistency in applying the legal standard under
Article 6.2 of the DSU to Japan's different claims in its panel request. In this context, therefore, the
Appellate Body's findings in past disputes do not lend support to Korea's argument. 383 This is
because, in those disputes , the incoherence or incons istency that amounted to a violation of
Article 11 of the DSU related to the manner in which the panel engaged with the evidence and facts
before it, rather than how the panel interpreted or applied a legal provision.

375 Japan's appellee's submission, para. 137.
376 Japan's appellee's submission, para. 137.
377 Japan's appellee's submission, para. 137.
378 Japan's appellee's submission, para. 138 (referring to Korea's other appellant's submission,
para. 262).
379 For example, in US – Upland Cotton (Article 21.5 – Brazil), the Appellate Body found that the panel's
"internally incoherent treatment of the same class of quantitative evidence … vitiates the conclusion it drew
based on the financial data submitted by the parties". (Appellate Body Report, US – Upland Cotton
(Article 21.5 – Brazil), para. 294) In EC and certain member States – Large Civil Aircraft, the Appellate Body
found that the panel's analysis revealed certain inconsistencies because the panel relied on certain benchmarks
that it had previously dismissed as unsuitable for assessing the existence of a "benefit" within the meaning of
Article 1.1(b) of the SCM Agreement. (Appellate Body Report, EC and certain member States – Large Civil
Aircraft, paras. 882-894) In Russia – Commercial Vehicles, the Appellate Body noted that, after finding that the
methodology used by the investigating authority to examine price effects under Article 3.2 of the Anti-Dumping
Agreement was flawed, the panel subsequently found that the same methodology was capable of supporting
the investigating authority's finding of price suppression. (Appellate Body Report, Russia – Commercial
Vehicles, paras. 5.55-5.64 and 5.78-5.79) In the latter two disputes, the Appellate Body found that the panel's
internally inconsistent reasoning "cannot be reconciled with [its] duty to make an objective assessment" of the
matter under Article 11 of the DSU. (Appellate Body Reports, EC and certain member States – Large Civil
380 Appellate Body Reports, China – Rare Earths, para. 5.227 (quoting Appellate Body Report,
EC – Poultry, para. 133).
381 Appellate Body Report, EC – Fasteners (China) (Article 21.5 – China), para. 5.292 (referring to
Appellate Body Reports, US – 1916 Act, para. 54; Mexico – Corn Syrup (Article 21.5 – US), para. 36).
382 Appellate Body Reports, Chile – Price Band System (Article 21.5 – Argentina), para. 238; US – Steel
383 See supra, fn 379.

5.157. As we have indicated above, the consistency of a claim with the requirements of Article 6.2
of the DSU is to be determined on the face of the panel request, on a case -by-case basis, taking
into consideration the circumstances of each case. We have found above that the Panel erred in its
application of this legal standard in finding that Japan's claims under Articles 3.1 and 3.2 of the
Anti-Dumping Agreement, part of its claim under Articles 3.1 and 3.4 of that Agreement , and its
claim under Articles 3.1 and 4.1 of that Agreement , respectively, were not within its terms of
reference. In contrast, we have found that the Panel did not err in its application of Article 6.2 of the
DSU in finding that Japan's three claims under Articles 3.1 and 3.5 of the Anti-Dumping Agreement
were within its terms of reference. 384 Thus, the contrasting findings under Article 6.2 of the DSU
regarding the different claims raised by Japan, which Korea contends are "internally inconsistent"385,
reflect the Panel's error in its application of this provision with regard to some of Japan's claims,
rather than a lack of an objective assessment as required by Article 11 of the DSU. In any event,
insofar as Japan's claims under Articles 3.1 and 3.5 are concerned, we have found no error in the
Panel's finding pursuant to Article 6.2 of the DSU that such claims were within its terms of reference.
Thus, we disagree with Korea's contention that the Panel acted inconsistently with its obligation
under Article 11 of the DSU in assessing the consistency with Article 6.2 of the DSU of Japan's claims
under Articles 3.1 and 3.5 of the Anti-Dumping Agreement.
5.158. Furthermore, we observe that in making this claim under Article 11 of the DSU, Korea
essentially identifies the same alleged errors by the Panel as those developed in its claim that the
Panel erred in its application of Article 6.2 of the DSU in finding that Japan's claims 4, 5, and 6 are
within the Panel's terms of reference . As such, therefore, Korea's claim that the Panel acted
inconsistently with Article 11 of the DSU is subsidiary to its other claims of error by the Panel, and
therefore does not "stand on its own", as a claim under Article 11 of the DSU would be required
to.386 For the foregoing reasons, we find that the Panel did not act inconsistently with Article 11 of
the DSU in assessing the consistency of Japan's panel request with Article 6.2 of the DSU.
5.3.3 Magnitude of margin of dumping
5.159. Japan appeals the Panel's conclusion that Japan failed to demonstrate that the KTC's
evaluation of the magnitude of the margin of dumping was inconsistent with Articles 3.1 and 3.4 of
the Anti -Dumping Agreement .387 Japan claims that the Panel erred in its interpretation and
application of these provisions and requests the Appellate Body to reverse the Panel's conclusion.388
In response, Korea maintains that the Korean investigating authorities properly evaluated in a
substantive manner the magnitude of the margin of dumping as part of its overall evaluation of
injury.389 On this basis, Korea requests the Appellate Body to uphold the Panel's conclusion at
issue.390
5.160. Before examining Japan's claim of error on appeal, we summarize the Panel's relevant
findings and conclusions under Articles 3.1 and 3.4. We then set out our understanding of the
relevant aspects of Articles 3.1 and 3.4 and examine the merits of Japan's claim of error on appeal.
5.3.3.1 The Panel's findings
5.161. Before the Panel, Japan argued that the KTC's finding regarding the magnitude of the margin
of dumping "has no factual support, and is con tradicted by the fact that the prices of the dumped
imports were consistently higher than domestic like product prices". 391 In response, Korea argued
that "[the] KTC reasonably concluded that the magnitude of the dumping margins was not

384 See sections 5.3.2.4-5.3.2.6 above.
385 Korea's other appellant's submission, para. 265.
386 See para. 5.154 above and supra fn 382.
387 Japan's appellant's submission, para. 255 (referring to Panel Report, paras. 7.187-7.191).
388 Japan's appellant's submission, paras. 255-268.
389 Korea's appellee's submission, para. 424.
390 Korea's appellee's submission, paras. 410 and 424.
391 Panel Report, para. 7.144.b (referring to Japan's first written submission to the Panel,
paras. 177-178).

insignificant and that such magnitude had a significant impact on the interaction between the sales
prices of the dumped imports and the like product."392 The KTC's finding at issue states:
As discussed previously, the final dumping margins of the dumped products were ranged
between 11.66% and 31.61%, which means the size of dumping margin is not
insignificant. Accordingly, such dumping appears to have had significant impact on the
sales price of the dumped products and that of the like product.393
5.162. In its examination of Japan's cla im, the Panel first noted that " Article 3.4 does not require
that the magnitude of the margin of dumping be evaluated in any particular manner or be given any
particular weight."394 However, the Panel also found that "an evaluation of the magnitude of the
margin of dumping in the assessment of the impact of dumped imports on the domestic industry
must 'be undertaken as a substantive matter'." 395 Specifically, "[a]n investigating authority is
required to evaluate the magnitude of the margin of dumping and to ass ess its relevance and the
weight to be attributed to it in the injury assessment."396 According to the Panel, a simple "listing of
the margins of dumping" in other aspects of an investigation "is not sufficient to demonstrate that
the magnitude of the margin of dumping was evaluated within the meaning of Article 3.4".397
5.163. In applying Article 3.4 to the facts of this dispute, the Panel found that "the KTC did more
than merely list or indicate the existence of margins of dumping of a particular magnitude in its
determination."398 Specifically, in light of the KTC's findings set out above, the Panel found that the
KTC "observed that the dumping margins were significant, and consequently that dumping had had
a significant impact on prices of both the dumped product and the domestic like product". 399
Therefore, the Panel found that the KTC's findings are "sufficient to demonstrate that it evaluated
the magnitude of the margins of dumping 'as a substantive matter'".400
5.164. Japan argued before the Panel that "an investigating authority is required to undertake some
form of counterfactual analysis, specifically in this case by adding the dumping margin to the actual
prices of the dumped imports, or comparing the magnitude of the dumping margin with the level of
overselling."401 In response, Korea contended that "Japan is not able to refer to any textual or
jurisprudential" basis to support such a counterfactual analysis. 402 The Panel rejected Japan's
argument, recalling that "there is no guidance in the Anti -Dumping Agreement regarding
methodology for the evaluation of economic factors in the context of Article 3.4", and, as such, there
is no textual basis for Japan's argument.403 The Panel also found that, "even assuming that such an
analysis might be relevant, a question which is for an investigating authority to consider in the first
instance, Japan has failed to demonstrate what specific factual circumstances made such an analysis
obligatory in this case."404 On this basis, the Panel concluded that Japan failed to establish that the
Korean investigating authorities acted inconsistently with Articles 3.1 and 3.4 of the Anti -Dumping

392 Korea's first written submission to the Panel, para. 231. Korea further contended that "[the] KTC
examined this factor and explained the basis for finding that the magnitude of the dumping detrimentally
affected the domestic industry." (Korea's second written submission to the Panel, para. 109 (fn omitted))
393 Panel Report, para. 7.188 (quoting KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 26).
394 Panel Report, para. 7.189.
395 Panel Report, para. 7.189 (quoting Panel Reports, China – HP-SSST (Japan) / China – HP-SSST (EU),
para. 7.162).
396 Panel Report, para. 7.189 (quoting Panel Report, China – X-Ray Equipment, para. 7.183).
397 Panel Report, para. 7.189 (referring to Panel Reports, Argentina – Poultry Anti-Dumping Duties,
China – HP-SSST (Japan) / China – HP-SSST (EU), paras. 7.161-7.162).
398 Panel Report, para. 7.190.
399 Panel Report, para. 7.190.
400 Panel Report, para. 7.191.
401 Panel Report, para. 7.191 (referring to Japan's response to Panel question Nos. 45 and 46, paras. 91
and 95). (emphasis original)
402 Korea's second written submission to the Panel, para. 111.
403 Panel Report, para. 7.191.
404 Panel Report, para. 7.191.

Agreement with respect to the examination of the impact of the dumped imports on the state of the
domestic industry.405
5.3.3.2 Whether the Panel erred in its interpretatio n of Articles 3.1 and 3.4 of the
Anti-Dumping Agreement
5.165. Article 3.4 of the Anti-Dumping Agreement provides:
The examination of the impact of the dumped imports on the domestic industry
concerned shall include an evaluation of all relevant economic factors and indices having
a bearing on the state of the industry, including actual and potential decline in sales,
profits, output, market share, productivity, return on investments, or utilization of
capacity; factors affecting domestic prices; the magnitude of the margin of dumping;
actual and potential negative effects on cash flow, inventories, employment, wages,
growth, ability to raise capital or investments. This list is not exhaustive, nor can one
or several of these factors necessarily give decisive guidance.
5.166. The first sentence of Article 3.4 requires an examination of the impact of dumped imports
on the domestic industry. Article 3.4 is thus concerned with "the relationship between subject
imports and the state of the domestic industry". 406 Hence, the provision contemplates that "an
investigating authority must derive an understanding of the impact of subject imports" on the
domestic industry407, which "requires an examination of the 'explanatory force' of subject imports
for the state of the domestic industry". 408 However, under Article 3.4, an investigating authority is
"not required to demonstrate that dumped imports are causing injury to the dom estic industry,
which is an analysis specifically mandated by Article 3.5".409
5.167. As noted, the focus of the examination required under Article 3.4 is on the state of the
domestic industry.410 This examination "shall include an evaluation of all relevant economic factors
and indices having a bearing on the state of the industry".411 This provision lists 15 factors that must
be evaluated for this purpose 412, one of which is the magnitude of the margin of dumping. As
provided in the last sentence of Article 3.4, the list of 15 factors is not exhaustive, nor can one or
several of these factors necessarily give decisive guidance. Rather, the examination stipulated under
Article 3.4 requires a holistic evaluation of "all relevant economic factors and indices having a bearing
on the state of the industry" as a whole. Article 3.4 thus does not require an individual or separate
finding of the relationship between the magnitude of the margin of dumping and the state of the
domestic industry.
5.168. The obligation under Article 3.4 is f urther informed by the overarching obligation in
Article 3.1413, which requires that a determination of injury "be based on positive evidence and
involve an objective examination". Based on the obligations under Articles 3.1 and 3.4 set out above,
the Appellate Body has stated that "Article 3.4, read together with Article 3.1, instructs investigating
authorities to evaluate, objectively and on the basis of positive evidence, the importance and the
weight to be attached to all the relevant factors." 414 Apart from the parameters described above,
Articles 3.1 and 3.4 do not prescribe a particular methodology for the evaluation of, or relevance or

405 Panel Report, para. 7.192. In reaching this conclusion, the Panel also rejected Japan's argument that
the KTC's evaluation of another factor listed in Article 3.4, i.e. the domestic industry's ability to raise capital or
investment, was conclusory and without any factual support. (Panel Report, paras. 7.144.a and 7.181-7.186)
These findings of the Panel are not subject to appeal. (Japan's appellant's submission, para. 255)
406 Appellate Body Report, China – GOES, para. 149.
407 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.205 (quoting
Appellate Body Report, China – GOES, para. 149). (emphasis original)
408 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.205 (quoting
Appellate Body Report, China – GOES, para. 149).
409 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.205 (referring to
Appellate Body Report, China – GOES, para. 150). (emphasis original)
410 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.204.
411 Emphasis added.
412 Appellate Body Report, Thailand – H-Beams, paras. 125 and 128.
413 Appellate Body Report, Thailand – H-Beams, paras. 90 and 106.
414 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.207.

weight to be attributed to, any one factor.415 Thus, Articles 3.1 and 3.4 do not prescribe a particular
relevance or weight to be attributed to the magnitude of the margin of dumping per se in the overall
assessment of the impact of dumped imports on the domestic industry.
5.169. We recall the Panel's statement that Article 3.4 requires that "an evaluation of the magnitude
of the margin of dumping in the assessment of the impact of dumped imports on the domestic
industry must 'be undertaken as a substantive matter'" and that "[a]n investigating authority is
required to evaluate the magnitude of the margin of dumping and to assess i ts relevance and the
weight to be attributed to it in the injury assessment."416 In our view, the Panel's articulation of the
legal standard under Article 3.4, insofar as the magnitude of the margin of dumping is concerned,
comports with a proper interpretation of the provision as set out above.
5.170. On appeal, Japan argues that "[a]n evaluation of the magnitude of the margins of dumping
plays an important role when examining the explanatory force of the dumped imports for the state
of the domestic indu stry."417 According to Japan, "[t]o address the ultimate question under
Article 3.5, the assessment of the relevance of the magnitude of the margin of dumping and the
weight to be attributed to that margin under Article 3.4 must take into account the relatio nship
among the dumping margins, the actual prices of the dumped imports, and the prices of the domestic
like products in the market."418 Thus, in Japan's view, "an investigating authority must evaluate the
dumping margin in light of the interaction of the p rices between the dumped imports and the
domestic like products" 419, and the Panel erred in its interpretation to the extent it suggested
otherwise.420
5.171. In response, Korea contends that the Panel correctly interpreted Articles 3.1 and 3.4 by
"reject[ing] the me re listing approach and confirm[ing] that a more substantive analysis [of the
magnitude of the margin of dumping] was required". 421 However, Korea submits that there is no
basis in the text of Article 3.4 for Japan's argument that "something more was legally required" and
that in any event, Japan "fail[ed] to clarify what that 'something substantive' should be in addition
to the substantive evaluation as undertaken by the KTC".422
5.172. We recall that Article 3.4 requires an evaluation of "all relevant economic factors and indices
having a bearing on the state of the industry".423 As such, while Article 3.4 requires an examination
of the explanatory force of subject imports on the state of the domestic industry through an
evaluation of all the relevant factors collectively, it does not follow that a particular factor should be
evaluated in a particular manner or given a particular relevance or weight. We do not preclude that,
in light of the particular circumstances of a case, an investigating authority may find it usefu l or
even necessary to assess the relationship between the magnitude of dumping margins and prices of
dumped and domestic like product in order to derive an understanding of the impact of subject
imports on the state of the domestic industry. However, we do not consider that such an assessment
is always required in order to evaluate the magnitude of the margin of dumping pursuant to
Article 3.4. We therefore consider that the Panel correctly found that "there is no guidance in the
Anti-Dumping Agreement regarding methodology for the evaluation of economic factors in the
context of Article 3.4" and that there is no textual basis for Japan's argument that an evaluation
must be done in the particular manner suggested by Japan.424
5.173. In support of its contention, Jap an relies on the negotiating history of the Anti -Dumping
Agreement, namely comments expressed during the Uruguay Round negotiations stating that the
causal link between dumping and material injury to the domestic industry is tenuous where the
margins of pr ice undercutting by dumped imports are substantially higher than the dumping

415 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.204.
417 Japan's appellant's submission, para. 258.
418 Japan's appellant's submission, para. 258.
419 Japan's appellant's submission, para. 262. (emphasis added)
420 Japan's appellant's submission, para. 256.
421 Korea's appellee's submission, para. 418.
422 Korea's appellee's submission, para. 419.
423 Emphasis added.
424 Panel Report, para. 7.191.

margins.425 We find this argument unpersuasive. First, the quoted comments relate to the question
of causation, addressed in Article 3.5, not the examination of the impact under Article 3.4.426
Second, those comments do not suggest that a particular method should be applied for evaluating
the magnitude of the margin of dumping in an examination of the impact of the dumped imports on
the domestic industry. They merely reflect situations in which the comparisons between the dumping
margins and the margins of underselling by dumped imports may be relevant for assessing the
causal link between the dumped imports and injury. Third, the situations referred to in those
comments are based on hy pothetical fact patterns that are distinguishable from the facts in the
current case and are thus further limited in their relevance to the case before us.427
5.174. In sum, we find that Articles 3.1 and 3.4 require an investigating authority to evaluate the
magnitude of the margin of dumping and to assess its relevance and the weight to be attributed to
it in the injury assessment. However, we do not consider that these provisions require any one of
the listed factors, such as the magnitude of the margin of dumping , to be evaluated in a particular
manner or given a particular relevance or weight, in examining the impact of the dumped imports
on the domestic industry. Based on the above considerations, we find that the Panel did not err in
its interpretation of Articles 3.1 and 3.4 of the Anti -Dumping Agreement with respect to the
evaluation of the magnitude of the margin of dumping.
5.3.3.3 Whether the Panel erred in its application of Articles 3.1 and 3.4 of the
Anti-Dumping Agreement with respect to the KTC's finding s on the magnitude of the
margin of dumping
5.175. Japan challenges the Panel's application of Article 3.4 of the Anti-Dumping Agreement to the
KTC's findings with respect to the magnitude of the margin of dumping, arguing that the KTC's
findings were not based on an objective examination and positive evidence. 428 In particular, Japan
recalls that, according to the Panel, the KTC's findings that the "size of the dumping margin is not
insignificant" and that "such dumping appears to have had a significant impact" on prices were
sufficient for purposes of conducting an evaluation of the magnitude of the margin of dumping under
Article 3.4.429 Japan challenges this finding by the Panel, and argues that the KTC's findings were
"not explained at all". 430 According to Japan, "[t]he dumping margin alone is insufficient, because
whether and to what extent the dumping margin may have any impact on the domestic prices
depends on the degree of competition between the dumped imports and the domestic like
products."431 In Japan's view, "[t]he fact that Article 3.4 does not specify any particular method does
not mean the [investigating] authorities need do nothing."432
5.176. In response, Korea argues that "[the] KTC had already established that domestic prices of
the like products were substantia lly suppressed by the selective low pricing and aggressive
marketing behavior of the Japanese respondents" and that "[s]uch aggressive marketing was
supported by the dumped imports' substantial dumping margins." 433 Korea also argues that " [the]

425 Japan's appellant's submission, paras. 259-261 and fns 365-366 thereto (quoting
MTN.GNG/NG8/W/10, p. 7; MTN.GNG/NG8/W/51/Add.1, p. 5, paras. 22-23).
426 See Japan's appellant's submission, paras. 259-260. Specifically, we note that the quoted comment
by Korea (MTN.GNG/NG8/W/10, p. 7) was made in connection with Articles 3.2 and 3.4 of the Tokyo Round
Agreement in Implementation of Article VI of the General Agreement on Tariffs and Trade, BISD 26S/171,
entered into force 1 January 1980, which were provisions addressing the volume of the dumped imports and
the effect of the dumped imports on prices and causation, respectively. Similarly, we note that the quoted
comment by Hong Kong (MTN.GNG/NG8/W/51/Add. 1, p. 5, paras. 22-23) was made in connection with
Article 3.4 of the Anti-Dumping Code addressing causation.
427 For instance, the quoted comment by Korea illustrates a situation where the margin of dumping is
de minimis (1%) and the margin of price underselling by dumped imports is 30%. (See Japan's appellant's
submission, para. 259 (quoting MTN.GNG/NG8/W/10, p. 7)) The quoted comments also assume that the
margins of dumping and the margins of underselling are comparable (for example, in the quoted comment by
Korea, a 1% dumping margin was compared with a 30% underselling margin to conclude that the underselling
margin would have been 29% in the absence of dumping). (Ibid.) Japan has not established that either of the
above scenarios is analogous to the facts in the anti-dumping investigation at issue.
428 Japan's appellant's submission, para. 265.
429 Japan's appellant's submission, para. 263. (fn omitted)
430 Japan's appellant's submission, para. 264.
431 Japan's appellant's submission, para. 265.
432 Japan's appellant's submission, para. 265.
433 Korea's appellee's submission, para. 422.

OTI verified that the domestic industries could have raised the sales price of the like product to the
level of the reasonable sales prices if there had been no dumping, based on the magnitude of
dumping margins and the range of 'reasonable sales prices'." 434 Thus, in Korea's view, "[the] KTC
reasonably concluded that the magnitude of the dumping margins was not insignificant and that
such magnitude had a significant impact on the interaction between the sales prices of the dumped
imports and the like product." 435 On this basis, Korea argues that the Panel was correct in finding
that the KTC engaged in a substantive analysis of the magnitude of the margin of dumping as
required under Article 3.4.436
5.177. As we recall, the Panel found that "the KTC did more than merely list or indicate the existence
of margins of dumping of a particular magnitude in its determination."437 Indeed, the KTC's findings
set out by the Panel confirm the Panel's finding that the KTC "observed that the dumping margins
were significant, and consequently that dumping had had a significant impact on prices of both the
dumped product and the domestic like product". 438 As such, we do not consider that the KTC did
"nothing" or that its evaluation of the magnitude of the margin of dumping was limited to the
"dumping margin alone", as asserted by Japan.
5.178. Japan further contends that the KTC's findings regarding the magnitude of the margin of
dumping were "not explained at all" 439 and that the impact that the dumping margin may have on
the domestic prices depends on "the degre e of competition between the dumped imports and the
domestic like products" .440 As noted above, we do not rule out that, in light of the particular
circumstances of a case, an investigating authority may find it useful or even necessary to assess
the relationship between the dumping margins and prices for purposes of evaluating the magnitude
of the dumping margin under Article 3.4. In this regard, as Japan argues, "the degree of competition
between the dumped imports and the domestic like products" 441 may shed some light on the
investigating authority's understanding of the impact of dumped imports on the domestic industry
when evaluating the magnitude of the margin of dumping. In the present case, however, the KTC
considered the competitive relationship between the dumped imports and the domestic like product
and found that there was evidence of instances of "fierce" competition.442 The Panel found no errors
in the KTC's finding concerning the competitive relationship. 443 Thus, in light of the competitive
relationship between the dumped imports and the domestic like product found by the KTC, we do
not consider that Japan has established that the KT C's findings regarding the magnitude of the
margin of dumping were "not explained at all" 444 or that the Panel erred in finding that the KTC's
findings are "sufficient to demonstrate that it evaluated the magnitude of the margins of dumping
'as a substantive matter'".445
5.179. Finally, we turn to Japan's argument that the KTC was required to conduct "some form of
counterfactual analysis".446 According to Japan, the investigating authority should pay particular
attention to the "impact of the margin of dumping" when examining the magnitude of the margin of
dumping under Article 3.4447, a factor that is particularly important in understanding "what the state
of the domestic industry would have been without any dumping". 448 The Panel assessed Japan's
argument and found that, "even assuming that such an analysis might be relevant, a question which

434 Korea's appellee's submission, para. 422. (fn omitted)
435 Korea's appellee's submission, para. 422.
436 Korea's appellee's submission, paras. 421 and 423-424.
437 Panel Report, para. 7.190.
438 Panel Report, para. 7.190.
439 Japan's appellant's submission, para. 264.
440 Japan's appellant's submission, para. 265.
441 Japan's appellant's submission, para. 265.
442 Panel Report, para. 7.294.
443 Panel Report, para. 7.295.c. The Panel reached this finding in the context of its review of the KTC's
consideration of diverging price trends, which we examine in section 5.3.4.1.2.2 below.
444 Japan's appellant's submission, para. 264.
445 Panel Report, para. 7.191.
446 Panel Report, para. 7.191 (referring to Japan's response to Panel question Nos. 45 and 46, paras. 91
and 95). According to Japan, such counterfactual analysis may be conducted either by adding the dumping
margin to the actual prices of the dumped imports, or by comparing the magnitude of the dumping margin
with the level of overselling. (Ibid.) See also Japan's appellant's submission, para. 258 (referring to
Appellate Body Report, US – Tax Incentives, fn 177 to para. 5.77).
447 Japan's appellant's submission, para. 266.
448 Japan's appellant's submission, para. 267.

is for an investigating authority to consider in the first instance, Japan has failed to demonstrate
what specific factual circumstances made such an analysis obligatory in this case." 449 On appeal,
Japan contends that, "in a case where import prices are overselling the domestic prices, the
[investigating] authorities cannot assume without more that the 'margin of dumping' is having any
impact on the domestic industry at all."450
5.180. In the present case, Japan relies on the overselling by the dumped imports as the basis for
requiring a counterfactual analysis . However, we recall that, before specifically evaluating the
magnitude of the dumping margin, the KTC had already considered the price effects of the dumped
imports and assessed the interactions between the imported and domestic prices. 451 In particular,
the Panel did not find any error in the KTC's finding that there was evidence of competition between
the dumped imports and the domestic like product in the Korean market for valves 452,
notwithstanding the average price overselling by the dumped imports. Thus, we do not consider that
the Korean investigating authorities "assume[d] without more that the 'margin of dumping' [was]
having any impact on the domestic industry". 453 While a counterfactual analysis may be useful in
certain circumstances, we consider that Japan has not established that the existence of overselling
in this case necessarily renders a counterfactual analysis obligatory under Article 3.4.454 As such, we
find that the Panel did not err in finding that "Japan has failed to demonstrate what specific factual
circumstances made [the proposed counterfactual] analysis obligatory in this case."455
5.181. In sum, we find that Japan has failed to subs tantiate that: (i) the Korean investigating
authorities did not evaluate the magnitude of the margin of dumping as required under Articles 3.1
and 3.4; and (ii) the Korean investigating authorities were required to conduct a counterfactual
analysis in light of the facts of the case. Based on the above considerations, we uphold the Panel's
finding, in paragraphs 7.189-7.192 and 8.3.a of the Panel Report, that Japan failed to establish that
the Korean investigating authorities acted inconsistently with Articles 3.1 and 3.4 of the
Anti-Dumping Agreement with respect to their evaluation of the magnitude of the margin of
dumping.
5.3.4 Causation
5.182. We now turn to examine Japan's appeal and Korea's other appeal concerning the Panel's
findings under Articles 3.1 and 3.5 of the Anti-Dumping Agreement. We recall that before the Panel,
Japan raised three claims with respect to Articles 3.1 and 3.5 of the Anti-Dumping Agreement. First,
Japan argued that the KTC failed to demonstrate the existence of a causal link between the dumped
imports and the state of the domestic industry in the absence of sufficient correlation between the
trends in volumes, prices, and the domestic industry's profits (claim 4). 456 Second, Japan argued
that the KTC failed to undertake a proper non -attribution analysis inasmuch as it failed to conduct
an objective analysis of certain known factors other than the dumped imports allegedly causing
injury to the domestic industry at the same time as dumped imports and failed to examine at all
some other known factors (claim 5).457 Finally, Japan claimed that the KTC's causation determination
was undermined by its flawed analyses of the volume of the dumped imports, the price effects, and
the impact of the dumped imports on the state of the domestic industry, "irrespective and
independent" of whether the Panel found the KTC's analyses of the volume, price effects, and impact
of the dumped imports on the domestic industry to be inconsistent with Articles 3.2 and 3.4 of the
Anti-Dumping Agreement (claim 6). 458 The Panel referred to this as the "independent" causation
claim.

449 Panel Report, para. 7.191.
450 Japan's appellant's submission, para. 267.
451 Panel Report, para. 7.115 (referring to KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 19).
452 Panel Report, para. 7.295.c.
453 Japan's appellant's submission, para. 267.
454 In response to questioning at the oral hearing, Japan acknowledged that the counterfactual analysis
it proposed in this case would have been imperfect at best, given that there were multiple exporters with
different margins of dumping.
455 Panel Report, para. 7.191.
456 Panel Report, para. 7.196.
457 Panel Report, para. 7.198. On appeal, Japan does not challenge the Panel's findings in this regard.
(Japan's appellant's submission, fn 384 to para. 273)
458 Panel Report, para. 7.195 (referring to Japan's first written submission to the Panel, paras. 192-196;
second written submission to the Panel, paras. 153-154).

5.183. The Panel chose first to address Japan's claim 6, followed by Japan's claims 4 and 5. The
Panel's findings on Japan's claims 4 and 6, set out above, are subject to appeal.
5.184. With respect to claim 6, Japan and Korea each appeal different aspects of the Panel's
findings. We begin our analysis with Korea's claim on appeal that the Panel erred in its interpretation
and application of Article 3.5 of the Anti-Dumping Agreement by subsuming all of the obligations of
Articles 3.2 and 3.4 of the Anti -Dumping Agreement under that provision in addressing Japan's
"independent" causation claim. Next, we address Japan's claim on appeal that the Panel erred in its
approach to resolving Japan's "independent" causation claim by failing to consider volume, price
effects, and impact as essential building blocks for any finding of causation under Article 3.5. Then,
we turn to examine Japan's claim that the Panel erred under Article 11 of the DSU and Article 17.6
of the Anti -Dumping Agreement by failing to consider Japan's rebuttal arguments on the issue
regarding the "reasonable sales price" in the context of Jap an's "independent" causation claim.
Thereafter, we address the claims raised by Korea concerning the Panel's findings on price
comparability and overselling in addressing Japan's "independent" causation claim. We then turn to
Korea's claim that the Panel e rred under Article 11 of the DSU and Article 17.6 of the
Anti-Dumping Agreement in failing to make an objective assessment of the matter. Finally, we
address Japan's claim on appeal that the Panel improperly refused to address the lack of meaningful
correlation in the context of the obligation under Article 3.5 and, therefore, erred in its approach to
resolving Japan's claim 4 regarding the failure to demonstrate a causal relationship.
5.3.4.1 Japan's "independent" causation claim (claim 6)
5.3.4.1.1 Whether the Panel erred in its interpretation or application of Article 3.5 by
subsuming all of the obligations of Articles 3.2 and 3.4 under Article 3.5 of the
Anti-Dumping Agreement
5.185. As noted, the Panel chose first to address Japan's "independent" causation claim. In that
respect, the Panel considered that Japan raised an "independent [claim] of violation of Article 3.5
with respect to Korea's flawed volume, price effects, and impact analyses, even if the Panel should
find that those flaws do not constitute violations of Articles 3.2 and 3.4".459 The Panel found that it
could not preclude the possibility that an investi gating authority's determination of causation may
be inconsistent with Article 3.5 of the Anti-Dumping Agreement due to inadequacies in its analysis
of the volume, price effects, or impact of dumped imports, even if th ese did not demonstrate a
violation of Articles 3.2 and/or 3.4 of the Anti-Dumping Agreement.460 However, the Panel also noted
that "[w]hile [Japan's] claim may be independent, Japan makes no new, separate or additional
arguments in support of that claim, simply referring back to certain of the arguments it made in
support of its claims under Articles 3.1, 3.2, and 3.4 to support its independent claim of inconsistency
with Articles 3.1 and 3.5." 461 For the purposes of assessing Japan's independent causation claim,
the Panel decided to limit its examination to those specific aspects of the KTC's consideration of the
volume and price effects, and its examination of the impact of dumped imports identified by Japan
in its submissions as independently demonstrating the inconsistency of the KTC's determin ation of
causation under Article 3.5.462
5.186. The Panel found that Japan failed to demonstrate that the Korean investigating authorities
acted inconsistently with Articles 3.1 and 3.5 of the Anti -Dumping Agreement because their
causation determination was undermined by alleged flaws in their consideration of the significance
of the increase in the volume of the dumped imports. 463 The Panel found the Korean investigating
authorities to have acted inconsistently with Articles 3.1 and 3.5 by failing to: (i) ensure pric e
comparability when they compared the individual transaction prices of certain models of dumped
imports with the average prices of corresponding models of the domestic like product (the relevant
price comparisons) 464; and (ii) adequately explain their consi deration of the price -suppressing
and -depressing effects of dumped imports in their determination of causation, in light of the
undisputed fact that the prices of the dumped imports were higher than those of the domestic like

460 Panel Report, para. 7.221.
461 Panel Report, para. 7.222.
462 Panel Report, para. 7.227.
463 Panel Report, para. 7.258.
464 Panel Report, paras. 7.272 and 7.323.a.

product throughout the period of trend analysis on the basis of both the average price of the product
as a whole and the average prices of representative models.465 The Panel, however, found that the
different magnitude of the price decreases from 2012 to 2013 and the opposing price movements
from 2011 to 2012 do not, in and of themselves, demonstrate that the KTC's determination of a
causal relationship is inconsist ent with Articles 3.1 and 3.5.466 Finally, the Panel found that Japan
failed to demonstrate that the Korean investigating authorities' determination of causation is, with
respect to the analysis of the impact of dumped imports on the domestic industry and independently
of any inconsistencies with Article 3.4, inconsistent with Articles 3.1 and 3.5 of the
Anti-Dumping Agreement.467
5.187. On appeal, Korea contends that the Panel "effectively" interpreted Article 3.5 of the
Anti-Dumping Agreement as setting forth an independent, comprehensive obligation to examine the
volume, price effects, and consequent impact of the dumped imports as part of the causation
obligation of Article 3.5.468 Korea submits that the Panel "walks through the exact same questions
of volume, price and overall impact that one would normally consider in the analyses under
Articles 3.2 and 3.4" of the Anti-Dumping Agreement.469 Article 3.5, according to Korea, deals with
a related but different and separate inquiry that concerns the existence of a causal relationship
between the injury, as established under Articles 3.2 and 3.4, on the one hand, and the dumped
imports, on the other hand.470 Thus, Korea submits that the reference to paragraphs 2 and 4 in the
first sentence of Article 3.5 does not call for re doing the examination under these paragraphs or
rendering them redundant.471
5.188. In response, Japan submits that Korea is wrong to read the overall obligation in Article 3.5
too narrowly.472 According to Japan, "[t]he analysis under Article 3.5 does not duplicate the analysis
under Article 3.2, but rather extends the analysis and addresses distinct but critically important
issues."473 For instance, Japan submits that "the Panel was correct to conclude that a thorough and
objective examination of the price effects of imports serves as a critical and essential building block
for any finding of causation under Articles 3.1 and 3.5."474 Japan contends that the first sentence of
Article 3.5 in using the terms "through the effects of dumping" makes clear that while " Articles 3.2
and 3.4 are important building blocks, … they do not end the analysis."475
5.189. Article 3.5 of the Anti-Dumping Agreement provides, in relevant part:
It must be demonstrated that the dumped imports are, through the effects of dumping,
as set forth in paragraphs 2 and 4, causing injury within the meaning of this Agreement.
The demonstration of a causal relationship between the dumped imports and the injury
to the domestic industry shall be based on an examination of all relevant evidence
before the authorities. The authorities shall also examine any known factors other than
the dumped imports which at the same time are injuring the domestic industry, and the
injuries caused by these other factors must not be attributed to the dumped imports.
5.190. The first sentence of Article 3.5 requires a demonstration that dumped imports are causing
injury within the meaning of the Anti -Dumping Agreement "through the effects of dumping, as set
forth in paragraphs 2 and 4", i.e. Articles 3.2 and 3.4 of the Anti -Dumping Agreement. Article 3.2
instructs an investigating authority to "consider" whether there has been a significant increase in
the volume of dumped imports, and to "consider" the effect of the dumped imports on prices, namely
whether there has been a significant pr ice undercutting, price depression, or price suppression by
the imported products vis -à-vis domestic like products. 476 Under Article 3.2, an investigating

465 Panel Report, paras. 7.322 and 7.323.c.
466 Panel Report, paras. 7.296 and 7.323.b.
467 Panel Report, para. 7.348.b.
468 Korea's other appellant's submission, para. 186.
469 Korea's other appellant's submission, para. 186.
470 Korea's other appellant's submission, para. 184.
471 Korea's other appellant's submission, para. 185.
472 Japan's appellee's submission, para. 85.
473 Japan's appellee's submission, para. 81.
474 Japan's appellee's submission, para. 79.
475 Japan's appellee's submission, para. 68 (quoting Article 3.5 of the Anti-Dumping Agreement).
(emphasis added by Japan; additional fn omitted)
476 See also Appellate Body Report, China – GOES, para. 129.

authority considers the explanatory force of dumped imports for, inter alia, the occurrence of price
effects, but it is not required to make "a definitive determination" on the volume of dumped imports
and the effect of such imports on domestic prices. 477 Article 3.4 in turn requires an investigating
authority to "examin[e]" the impact of dumped imports on the domestic industry on the basis of "an
evaluation" of all relevant economic factors and indices that have a bearing on the state of the
industry. As clarified by the Appellate Body, while "Article 3.4 requires an examination of the
'explanatory force' of subject imports for the state of the domestic industry" 478, an investigating
authority is not required to demonstrate under that provision whether subject imports are causing
injury to the domestic industry.479
5.191. Rather, the demonstration that "dumped … imports are causing injury 'through the effects
of' dumping … '[a]s set forth in paragraphs 2 and 4'" is to be conducted by the investigating authority
under the aegis of Article 3.5.480 The use of the phrase "as set forth in paragraphs 2 and 4" in
Article 3.5 makes it clear that " proper assessment[s]" under Articles 3.2 and 3.4 are "necessary
building block[s]"481, which " contribute[] to", rather than replicate, the "overall determination" of
injury and causation that is required under Article 3.5.482 The first sentenc e of Article 3.5 thus
suggests that these "building blocks" form part of and are "linked through a causation analysis
between subject imports and the injury to the domestic industry, taking into account all factors that
are being considered and evaluated".483 In requiring a "demonstrat[ion] that the dumped imports
are, through the effects of dumping, as set forth in paragraphs 2 and 4, causing injury", the
causation inquiry under Article 3.5 calls for a holistic assessment by an investigating autho rity that
links together the considerations under Article 3.2 and the examination conducted under Article 3.4
in order to reach a definitive determination regarding the existence of a causal relationship between
dumped imports and injury to the domestic industry. In this context, the inquiries under Articles 3.2
and 3.4 "should not be viewed in isolation", as they are "necessary components" 484 and form part
of the "logical progression of inquiry leading to an investigating authority's ultimate injury and
causation determination".485
5.192. The use of the word "demonstrate[]" in Article 3.5 in contrast to the words "consider" in
Article 3.2 and "examination" in Article 3.4 indicates that Article 3.5 establishes a standard that is
distinct from Articles 3.2 and 3.4, inasmuch as Article 3.5 is concerned with the establishment of the
causal link between dumped imports and injury. 486 Moreover, the second sentence of Article 3.5
provides that the demonstration of a causal relationship between the dumped imports and the injury
to the domestic industry shall be based on "an examination of all relevant evidence before the
authorities".487 The use of the phrase "all relevant evidence" means that Article 3.5 covers a broad
basket of evidence that encompasses, and is not limited to, th e evidence relating to the inquiries

477 Appellate Body Report, China – GOES, paras. 130 and 136. The Appellate Body explained that
"[i]nterpreting Article[] 3.2 … as requiring a consideration of the relationship between subject imports and
domestic prices does not result in duplicating the causation analysis under Article[] 3.5." (Appellate Body
Report, China – GOES, para. 147)
478 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.205 (quoting
Appellate Body Report, China – GOES, para. 149).
479 Appellate Body Report, China – GOES, para. 150.
480 Appellate Body Report, China – GOES, para. 128. (emphasis original)
481 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.162.
482 Appellate Body Report, China – GOES, para. 149. (emphasis original)
483 Appellate Body Report, China – GOES, para. 128. (fn omitted)
484 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.141 (referring to
Appellate Body Report, China – GOES, para. 128).
485 Appellate Body Report, China – GOES, para. 128.
486 The Appellate Body indicated that the word "consider" in Article 3.2 stands in contrast with the word
"demonstrate" in Article 3.5 that requires an investigating authority to make "a definitive determination
regarding the causal relationship between subject imports and injury to the domestic industry".
(Appellate Body Report, China – GOES, para. 130 and fn 217 thereto)
487 Emphasis added.

under Articles 3.2 and 3.4.488 This suggests that Article 3.5 has a broader scope of examination than
Articles 3.2 and 3.4.489
5.193. The overall context provided by Article 3 of the Anti-Dumping Agreement thus makes it clear
that the various paragraphs of Article 3, together, provide an investigating authority with the
relevant framework and disciplines for conducting an injury and causation analysis. 490 Articles 3.2
and 3.4 are provisions that are intended "to develop an investigating authority's overall examination"
of injury and causation.491 The "outcomes" of these inquiries in turn form "the basis for the overall
causation analysis contemplated in Article[] 3.5". 492 In our view, reading these provisions in this
manner comports with the fact that, while the inquiries foreseen under Articles 3.2, 3.4, and 3.5 are
"interlinked elements of a single, overall analysis addressing the question of whether dumped
imports are causing injury"493, the inquiry under each provision has a distinct focus.494
5.194. These considerations suggest that claims regarding alleged deficiencies in an investigating
authority's analyses of the volume and price effects, and its examination of the impact of the dumped
imports on the state of the domestic industry, are reviewable by a panel under Articles 3.2 and 3.4,
respectively, as these provisions contain the requirements pursuant to which the investigating
authority conducts such analyses. In contrast, with respect to a claim under Article 3.5, a panel is
tasked with reviewing an investigating authority's ultimate demonstration that the "dumped imports
are, through the effects of dumping, as set forth in paragraphs 2 and 4 , causing injury" to the
domestic industry. In so doing, a panel is called upon to review whether the investigating authority
properly linked the outcomes of its analyses conducted pursuant to Articles 3.2 and 3.4, taking into
account the evidence and factors required under Article 3.5, in coming to a definitive determination
regarding the causal relationship between dumped imports and injury to the domestic industry. A
panel's review of a claim under Article 3.5, therefore, concerns the investigating authority's ultimate
determination of causation on the basis of a proper linkage among the various components, in light
of all evidence and factors set out in that provision. A panel's review does not, however, call for
revisiting the question whether each of the interlinked components of this determination itself meets
the applicable requirements set out in Article 3.2 or 3.4. Examining such consistency in the context
of a claim under Article 3.5 would effectively require a panel to incorporate and apply requirements
and disciplines set out in other paragraphs of Article 3, which are not contained in the text of
Article 3.5. To that extent, we agree with Korea that the phrase "through the effects of dumping, as
set forth in paragraphs 2 and 4" in Article 3.5 "is not a call [for a panel] to re-do the examination[s]"
under Articles 3.2 and 3.4 of the Anti-Dumping Agreement.495
5.195. In the present dispute, we recall that the Panel excluded from its terms of reference Japan's
claims regarding: (i) the inconsistency of the KTC's consideration of volume and price effects with
Article 3.2; and (ii) the inconsistency of the KTC's examination of the impact of the dumped imports
on the domestic industry with Article 3.4.496 As such, the Panel did not examine and make findings
on these claims under Articles 3.2 and 3.4 of the Anti -Dumping Agreement. The Panel, however,
found it to be within its terms of reference to examine claim 6 in Japan's panel request, in which
Japan contended that the KTC's causation determination was undermined by its flawed analyses of

488 We agree with the Panel that evidence that does not fall squarely within the parameters of
Articles 3.2 and 3.4 may be relevant and persuasive with respect to whether a causal relationship can be
demonstrated under Article 3.5. (Panel Report, para. 7.248)
489 The Appellate Body stated that "[t]he examination under Article[] 3.5 … by definition[] covers a
broader scope than the scope of the elements considered in relation to price depression and suppression under
Article[] 3.2". (Appellate Body Report, China – GOES, para. 147)
490 Appellate Body Report, China – GOES, para. 128.
491 Appellate Body Report, China – GOES, para. 144. (emphasis original)
492 Appellate Body Report, China – GOES, para. 149.
493 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.141.
494 We recall that, in the context of Articles 3.2 and 3.5 of the Anti-Dumping Agreement, the
Appellate Body found that "[w]hile the assessments under both Article[s] 3.2 and 3.5 are interlinked elements
of the single, overall injury analysis, the inquiry under each provision has a distinct focus." (Appellate Body
Report, Russia – Commercial Vehicles, para. 5.54 (referring to Appellate Body Reports, China – HP-SSST
(Japan) / China – HP-SSST (EU), para. 5.141))
495 Korea's other appellant's submission, para. 185.
496 We note that in the context of Japan's claim under Articles 3.1 and 3.4 of the Anti-Dumping
Agreement, the Panel found that "Japan's claim concerning the state of the domestic industry, under
Articles 3.1 and 3.4 of the Anti-Dumping Agreement, is limited to the allegation that the KTC failed to evaluate
two of the specific factors listed in Article 3.4." (Panel Report, para. 7.175)

the volume of the dumped imports, the price effects, and the impact of the dumped imports on the
state of the domestic industry, "irrespective and independent" of whether the Panel found the KTC's
analyses of volume, price effects, and impact to be inconsistent with Articles 3.2 and 3.4. 497 In
explaining its understanding of the phrase "irrespective and independent" in claim 6, the Panel noted
that it "[could not] preclude the possibility that an investigating authority's determination of
causation may be inconsistent with Article 3.5 due to inadequacies in its analysis of the volume,
price effects, or impact of dumped imports, even if these do not demonstrate a vio lation of
Articles 3.2 and/or 3.4".498
5.196. As discussed above, given that Articles 3.2 and 3.4 contain the requirements pursuant to
which an investigating authority conducts its volume, price effects, and impact analyses, a claim of
alleged deficiencies in such analyses is reviewable by a panel under these provisions. Furthermore,
by virtue of the phrase "through the effects of dumping, as set forth in paragraphs 2 and 4" in the
first sentence of Article 3.5, to the extent that a panel finds that an investigating authority's volume,
price effects, and impact analyses are inconsistent with its obligations under Articles 3.2 and 3.4,
such inconsistencies would likely undermine an investigating authority's overall causation
determination and consequentially lead to an inconsistency with Article 3.5.499 However, the
"possibility" referred to above by the Panel appears to concern a different scenario, in which an
investigating authority's analyses of the volume, price effects, and impact "do not" themselves
demonstrate an inconsistency with Article 3.2 or Article 3.4, but nonetheless contain "inadequacies"
that "independently" constitute a violation of Article 3.5. As noted above, the totality of the evidence
and factors stipulated under Article 3.5, including the evidenc e underpinning an investigating
authority's volume, price effects, and impact analyses, may be reviewed under Article 3.5 for the
purpose of examining whether an investigating authority has demonstrated the requisite causal
relationship. We do not exclude that, based on such a review, a panel might find that an investigating
authority erred under Article 3.5 in its demonstration of causation due to its failure to link properly
its consideration of volume and price effects, and its examinat ion of the impact on the state of the
domestic industry, even where these elements, individually, may not breach the obligations set out
in Articles 3.2 and 3.4, respectively.500 To that extent, we do not find the Panel to have erred in its
approach merely because it identified the "possibility" referred to above and proceeded to examine
Japan's "independent" causation claim as set out in claim 6 in Japan's panel request.
5.197. However, Korea contends that the Panel simply accepted Japan's assertion that such an
"independent" claim may exist but failed to give any example of such a "less evident" theoretical
possibility.501 Rather, Korea contends that, in examining Japan's claim 6, the Panel "effectively"
interpreted Article 3.5 as setting forth an independent, compr ehensive obligation to examine the
volume, price effects, and impact of the dumped imports as part of the causation obligation of
Article 3.5.502 We also note that Japan argues that the Panel failed to consider volume as an essential
"building block" for causation by focusing too narrowly on the requirements of the first sentence of
Article 3.2 and not on the proper analysis under Article 3.5 regarding causation.503 Similarly, Japan
asserts that the Panel failed to consider impact as an essential "building bloc k" for causation by
focusing too narrowly on the requirements of Article 3.2 concerning volume and price effects, and
Article 3.4 regarding impact, and not on the proper analysis under Article 3.5 regarding causation.504
5.198. Thus, in order for us to determine w hether, in applying Article 3.5 for the purpose of
examining Japan's claim 6, the Panel erroneously "walk[ed] through" the exact same questions of
volume, price effects, and overall impact that one would normally consider in the analyses under
Articles 3.2 and 3.4 505, we review the Panel's findings under claim 6 in light of the claims and

497 Panel Report, para. 7.195 (referring to Japan's first written submission to the Panel, paras. 192-196;
second written submission to the Panel, paras. 153-154).
498 Panel Report, para. 7.221.
499 We note that such a consequential finding under Article 3.5 can be made to the extent that a
complaining party advances a consequential claim in this regard.
500 We note that Korea concedes that "the situation could arise if the WTO-consistent volume, price and
impact analyses, while individually correct, do not hold together for example because of a lack of coincidence in
trends between these factors." (Korea's other appellant's submission, para. 188)
501 Korea's other appellant's submission, paras. 187-188.
502 Korea's other appellant's submission, para. 186.
503 Japan's appellant's submission, para. 277 (referring to Panel Report, para. 7.258).
504 Japan's appellant's submission, para. 289 (referring to Panel Report, para. 7.347).
505 Korea's other appellant's submission, para. 186.

arguments raised on appeal by Japan and Korea. We begin with Japan's argument that the Panel
erred in its approach to resolving claim 6 by failing to consider volume as an essential building block
for any finding of causation.
5.3.4.1.2 Whether the Panel erred in its approach to resolving Japan's claim 6
5.3.4.1.2.1 Whether the Panel failed to consider volume as an essential building block for
any finding of causation
5.199. On appeal, Japan contends that the Panel rejected its argument by focusing too narrowly on
the requirements of the first sentence of Article 3.2 of the Anti -Dumping Agreement regarding
volume, and not on the proper analysis under Article 3.5 of the Anti-Dumping Agreement regarding
causation.506 According to Japan, in order to determine whether the KTC conducted a proper
causation analysis under Article 3.5, it was for "the Panel to consider [the volume-related] facts and
other facts as part of a holistic analysis of the KTC's finding of causation and how the KTC explained
that finding".507 Japan submits that the Panel did not do so and, instead, quoted the KTC's discussion
of facts under the first sentence of Article 3.2, and then quoted the KTC's "overall evaluation". 508
Japan submits that the KTC's "overall evaluation" about causation did not discuss any of the contrary
facts and ignored the overall POI.509
5.200. In response, Korea avers that while Japan contends that the Panel approached Article 3.5
"too narrowly", Japan does not explain "how or why that was the case and what the Panel should
have done". 510 Korea asserts that it is difficult to understand the "error of law" that the Panel
allegedly committed.511 In any event, Korea contends that the Panel did not just check a box but
examined the volume analysis of the KTC as part of its injury analysis.512
5.201. We recall that, before the Panel, Japan argued that "[t]he volum e of subject imports
increased only modestly in absolute terms and had decreased market share over the full 2010 to
2013 period", and that "this evidence … tended to disprove the existence of any 'causal
relationship'."513 The Panel noted that "Japan's allegation that certain flaws in the KTC's analysis of
the volume of dumped imports 'independently' undermine its causation determination"514 was based
on the fact that: (i) the volume of dumped imports decreased during two years of the three -year
period of trend analysis; and (ii) the volume of dumped imports increased only modestly in absolute
terms and decreased in terms of market share in 2013 compared with 2010.515 The Panel examined
the KTC's consideration of the volume of dumped imports which, as Japan notes, was found in "the
KTC discussion of facts under the first sentence of Article 3.2".516 The Panel noted that the KTC
"considered whether there was a significant increase in dumped imports in absolute terms, relative
to domestic consumption , and relative to d omestic production". 517 From each of these three
perspectives, the KTC found that "the volume of the dumped imports decreased from 2010 to 2012,
then increased sharply from 2012 to 2013."518 According to the Panel, the KTC neither relied on nor
was required to show a significant increase of dumped imports from 2010 to 2012 or over the entire
period of trend analysis. 519 The Panel further found that the KTC "examined the trends in volume
and market share on an end -point to end-point basis … [as well as on a] year -on-year [basis]"520,
and "did not ignore the decline in dumped imports from 2010 to 2012".521

506 Japan's appellant's submission, para. 277 (referring to Panel Report, para. 7.258).
507 Japan's appellant's submission, para. 278.
508 Japan's appellant's submission, para. 278 (referring to Panel Report, para. 7.252, in turn quoting
KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), pp. 14 and 27).
509 Japan's appellant's submission, para. 278.
510 Korea's appellee's submission, para. 433 (quoting Japan's appellant's submission, para. 277).
511 Korea's appellee's submission, para. 433.
512 Korea's appellee's submission, para. 435.
513 Japan's first written submission to the Panel, para. 194.
514 Panel Report, para. 7.250.
515 Panel Report, para. 7.251.
516 Japan's appellant submission, para. 278 (fn omitted).
517 Panel Report, para. 7.253.
518 Panel Report, para. 7.253.
519 Panel Report, paras. 7.254-7.257.
520 Panel Report, para. 7.257.
521 Panel Report, para. 7.254.

5.202. We note that Article 3.5 does not prescribe a particular methodology for evaluating the
volume of imports for the purposes of demonstrating the causal link between d umped imports and
injury to the domestic industry. Rather, Article 3.2, first sentence, requires an investigating authority
to consider "whether there has been a significant increase in dumped imports, either in absolute
terms or relative to production or consumption". Under Article 3.2, first sentence, these three
methods do not operate to the mutual exclusion of each other and an investigating authority may
opt to rely on one, two, or all of them for its analysis under that provision.
5.203. As we see it, the P anel's above analysis in the context of Japan's claim 6 reviewed the
requirements set out in Article 3.2, first sentence, as opposed to those under Article 3.5 in
addressing the causation claim at issue. Indeed, in the absence of any specific requirements
concerning the volume of dumped imports, Article 3.5 could not have guided the Panel's assessment
of whether the KTC adequately explained the decrease in the volume of imports from 2010 to 2012
in reaching its finding of a significant increase of the volume of dumped imports. Rather, in reviewing
Japan's argument that the market share of dumped imports decreased on an end-point to end-point
basis, the Panel relied on the requirements set out in Article 3.2, first sentence. Specifically, the
Panel noted that the first sentence of Article 3.2 "sets out three parameters for the consideration of
the volumes of the dumped import", and considered that "[t]he use of the disjunctive 'either … or'
in the first sentence of Article 3.2 suggests that an investigating au thority need only to consider
whether there is a significant increase either in absolute terms or in relative terms ."522 The Panel
correctly explained that "[t]he results of the investigat [ing] authority's consideration from any of
these perspectives can independently serve as a basis for its consideration of the ultimate causation
question under Article 3.5."523 However, in reviewing the causation claim at issue, the Panel, in our
view, effectively incorporated the requirements in Article 3.2, first sentence, concerning the volume
of dumped imports, in its assessment of a claim under Article 3.5. As discussed above, in reviewing
a claim under Article 3.5, a panel is not called upon to revisit the question whether each of the
interlinked components of this determination, such as the investigating authority's volume analysis,
is itself consistent with the applicable requirements set out in Article 3.2. Rather, the task of a panel
in addressing a claim under Article 3.5 is to review whether the investigating authority properly
linked the outcomes of its analyses conducted pursuant to Articles 3.2 and 3.4 taking into account
the evidence and factors required under Article 3.5, in coming to a definitive determination regarding
the causal relationship between dumped imports and injury to the domestic industry. We find the
Panel to have used the first sentence of Article 3.2 as "the template for its analysis" 524 of the
causation claim at issue, rather than properly applying the requirements set out in Article 3.5. We
therefore consider the Panel to have erred in its application of Article 3.5 of the Anti -Dumping
Agreement.
5.204. This does not, however, conclude our examination regarding Japan's contention that it has
demonstrated that the KTC's volume analysi s contains flaws that "independently" undermined its
causation determination. Japan contends that, while a finding of significant increase in the absolute
level of imports over a one -year period might be sufficient to comply with the first sentence of
Article 3.2 in certain cases, "the implications of the volume of imports for purposes of causation
[analysis] under Article 3.5 become very different" if the increase: (i) is "merely regaining the
historical level of imports"; and (ii) "actually represents a loss of market share".525 However, we do
not find specific arguments in Japan's submissions that substantiate the alleged "implications" of the
import volume for the causation analysis under Article 3.5. Furthermore, although Japan rightly
contends that the Panel, in the context of the causation claim at issue, was required to consider the
volume-related facts and other facts "as part of a holistic analysis of the KTC's finding of causation
and how the KTC explained that finding", Japan has not identified whic h "other facts" the Panel
should have considered as part of "a holistic analysis" of the KTC's finding of causation. 526 We
therefore do not consider Japan to have substantiated its "independent" claim that the KTC acted
inconsistently with the requirements o f Articles 3.1 and 3.5 of the Anti -Dumping Agreement by
focusing solely on one of the years of the three-year POI.

523 Panel Report, fn 358 to para. 7.257. (emphasis omitted)
524 Japan's appellant's submission, para. 277.
525 Japan's appellant's submission, para. 279.
526 Japan's appellant's submission, para. 278.

5.3.4.1.2.2 Whether the Panel failed to consider price effects as an essential building
block for any finding of causation
5.205. Before the Panel, Japan advan ced three grounds in support of its claim that the KTC's
analysis of the price effects of dumped imports "independently" undermined its causation
determination, namely that: (i) there was a divergence between the trends in prices of dumped
imports and domestic like product; (ii) dumped imports consistently and significantly oversold the
domestic like product; and (iii) there was no competitive relationship between the dumped imports
and the domestic like product, such that their prices were not comparable.527 The Panel found that
the KTC acted inconsistently with Articles 3.1 and 3.5 on the basis of the second and third grounds
advanced by Japan. 528 Korea challenges these findings on appeal , which we consider in section
5.3.4.1.4 below.
5.206. As for diver ging price trends, the Panel rejected Japan's arguments. 529 Japan appeals the
Panel's findings and contends that the Panel: (i) "incorrectly viewed its findings about diverging price
trends in isolation of its other findings about price comparability and pri ce overselling"; and (ii)
"incorrectly accepted allegations about the alleged fierce competition".530 Japan avers that "[r]ather
than considering the diverging price trends 'in themselves'", the Panel should have considered "the
diverging price trends in the context of the lack of price comparability and the persistent and
significant price overselling".531
5.207. In response, Korea submits that Japan's claim of legal error is unclear. 532 Korea avers that
Japan does not take issue with the price -related findings that w ere in its favour but considers
that: (i) "the Panel looked at other price -related issues in isolation, 'ignored its own findings', and
thus essentially contradicted itself"; (ii) "the Panel 'never explained' how allegedly isolated examples
demonstrated that all like products were in competition"; (iii) "the Panel never put its allegedly
isolated examples in 'context'"; and (iv) "it is 'not an objective examination' of the Panel to consider
facts in isolation."533 Korea submits that "[a]ll of this appears to be more of an Article 11 DSU claim
than a claim of legal error."534
5.208. Before the Panel, Japan argued that the prices of the dumped imports and that of the
domestic like product diverged over the period of trend analysis, both on the basis of average sales
price and on the basis of the price fluctuation index. 535 The Panel, therefore, understood Japan to
assert that "these diverging price trends show [ed] that there was no market interaction between
the dumped imports and the domestic like product", thus "undermining the KTC's price suppression
and depression analyses, which in turn formed the basis of the ultimate determination under
Article 3.5".536 The Panel noted that the prices of the dumped imports and the domestic like product
moved in generally the same direction from 2010 to 2011. However, from 2011 to 2012, the average
price of dumped imports increased, while that of the domestic like product decreased.537 The Panel
recognized that "[a]n increase in the price of the dumped imports might be expected to be
accompanied by an increase in domestic prices ."538 The Panel therefore considered that, in such a
situation, it was expected of a reasonable investigating authority to explain why, nonetheless, it
considers that the dumped imports affect the prices of domestic like product.539 The Panel found
that the KTC provided explanation in this regard.540 The Panel further noted that, from 2012 to 2013,

527 Panel Report, para. 7.259.
528 Panel Report, para. 7.323.
529 Panel Report, para. 7.296.
530 Japan's appellant's submission, para. 283.
531 Japan's appellant's submission, para. 284.
532 Korea's appellee's submission, para. 439.
533 Korea's appellee's submission, para. 439. (fns omitted)
534 Korea's appellee's submission, para. 439.
535 Panel Report, para. 7.273.
536 Panel Report, para. 7.273.
537 Panel Report, para. 7.277.
538 Panel Report, para. 7.279.
539 Panel Report, para. 7.279.
540 Panel Report, para. 7.279. The Panel found that "the OTI attributed the increase in the dumped
import prices to changes in the product mix of the dumped imports to higher-priced valves in the context of
the divergence from 2011 to 2012." (Ibid.) The Panel noted that in certain product groups, "the prices of the
dumped imports stagnated or decreased, in line with the price trends of the corresponding domestic like
products." (Ibid., para. 7.295.a)

the average prices of both dumped imports and domestic like product declined, with average import
prices declining to a greater extent.541 In this respect, the Panel found that the difference in the
decline "in itself [did] not demonstrate that the KTC erred in considering that the dumped imports
and the domestic like products competed with each other". 542 Rather, the Panel found the KTC's
explanation that the prices of the domestic industry were already at unsustainably low levels not to
be unreasonable.543
5.209. As we see it, the Panel's analysis here focused on whether there was a competitive
relationship between dumped imports and domestic like product despite diverging price trends, and
whether the diverging price trends could, in and of themselves, undermine the causal relationship.
We find this evident from the manner in which the Panel drew its conclusions concerning the
diverging trends in the average prices of dumped imports and the domestic like product when it
found that: (i) the different magnitude of the price decreases from 2012 to 2013 does not necessarily
undermine the KTC's findings with respect to the competitive relationship between the dumped
imports and the domestic like product 544; (ii) the opposing price movements from 2011 to 2012
could suggest a lack of competition between the dumped imports and the domestic like product, and
the KTC did not d isregard this possibility in its analysis 545; and (iii) the verified instances in which
the dumped imports were sold at prices lower than those of the domestic like product support the
view that there was competition in the Korean market for valves.546 The Panel further explained that
"[i]f there is evidence in the record which may call into question the nature and extent of the
competitive relationship between dumped imports and the domestic like product, an investigating
authority cannot disregard such evidence in considering the effect of dumped imports on prices."547
5.210. Thus, the Panel's above analysis reviewed the Korean investigating authorities' examination
of the relationship between the prices of the dumped imports and those of the domestic like products,
in order to ascertain the effects of the former on the latter. In our view, this corresponds to an
examination properly conducted pursuant to Article 3.2, second sentence. The Panel's conclusion
that the diverging price trends do not, in and of themselves, demonstrate that the KTC's
determination of a causal relationship is inconsistent with Articles 3.1 and 3.5 was a mere
consequence of its analysis as to whether the KTC's price -effects analyses were objective and
reasoned, and compatible with the requirements set out in Article 3.2, second sentence. This, in our
view, is further borne out from the manner in which the Panel addressed Korea's argument that the
verified instances in which the dumped imports were offered to customers at prices similar to , or
lower than, the prices of the domestic like product demonstrate "market interaction" between the
dumped imports and the domestic like product.548 In that context, the Panel found that the evidence
of lower prices of imported products in sales of certain models or to certain customers, while in itself
not determinative, did support the conclusion that there was competition between dumped imports
and the domestic like product in the Korean market for valves, and " which in turn lends support to
the KTC's price sup pression and depression findings ".549 We note that the Korean investigating
authorities' findings on the price-suppressing and -depressing effects of the dumped imports formed
one of the bases for their ultimate determination of causation. However, the Panel's analysis of the
issue of diverging price trends, in our view, was based on the applicable requirements under
Article 3.2, rather than those concerning causation under Article 3.5, even though it was addressing
a claim under Article 3.5. In so doing, the Panel effectively incorporated the requirements of
Article 3.2, rather than applying properly the requirements set out in Article 3.5, when addressing
Japan's causation claim under this provision. For these reasons, we find the Panel to have erred in
its application of Article 3.5 of the Anti-Dumping Agreement.
5.211. This does not mean, however, that we consider Japan to have demonstrated that the KTC's
examination of the diverging price trends necessarily rendered its causation determination
inconsistent with Articles 3.1 and 3.5 of the Anti -Dumping Agreement. Rather, apart from arguing
that the Panel's review of the KTC's examination of diverging price trends was not properly done,

541 Panel Report, para. 7.277.
543 Panel Report, para. 7.278 (referring to KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 18).
544 Panel Report, para. 7.295.a.
545 Panel Report, para. 7.295.a.
546 Panel Report, para. 7.295.c.
548 Panel Report, para. 7.291.

Japan has not demonstra ted why the KTC's examination contains flaws that vitiate its causation
determination pursuant to the requirements set out in Articles 3.1 and 3.5.
5.212. Specifically, contrary to Japan's argument550, the Panel, at this stage of its analysis, did not
come to a co nclusion on how dumped imports affected domestic like product prices for the entire
period of trend analysis. Rather, the Panel proceeded step by step, examining the trend in each year
of the POI and the KTC's relevant explanation. Furthermore, the Panel o bserved that "[t]he KTC
based its price suppression and depression findings in part on the 'fierce' competition between
certain dumped imports and the domestic like product", evidenced by "SMC Korea's alleged price
discrimination among different customers" .551 Japan submits that, in making this observation, the
Panel never explained "how these isolated examples demonstrated that all domestic like products
are in competition with the dumped imports" and thus "met the legal standard
under either Article 3.2 or Article 3.5 to assess the effects of imports on the domestic like product
as a whole". 552 However, while the Panel found that evidence of the alleged price discrimination
supported the conclusion that there was competition between dumped imports and domestic like
products, the Panel, importantly, acknowledged that it was not in itself determinative. Rather, the
Panel noted that such evidence "lends support" to the KTC's findings of price suppression and price
depression.
5.213. Moreover, the Panel found that "[t]he KTC's price suppression and depression findings
were not solely … based on a consideration of average price trends ", but also on "the alleged price
discrimination among different customers with respect to specific prod ucts or product ranges, and
the strengthened marketing activities of SMC Korea" .553 Thus, the Panel considered and analysed
how isolated instances of lower priced sales affected the domestic like product prices as a whole. By
arguing that "the Panel ignores the legal obligation to consider the effects on the prices of the
domestic like product as a whole"554, Japan attempts to view the Panel's assessment of its arguments
regarding diverging price trends in isolation. The Panel's above analysis of the KTC's cons ideration
of the diverging price trends reflects , in our view, a proper review pursuant to the requirements
under Article 3.2. Therefore, we see no reason to disagree with such analysis in light of the applicable
requirements under Article 3.2. However, in so doing, the Panel effectively incorporated the
requirements of Article 3.2, rather than properly applying the requirements set out in Article 3.5,
even though it was reviewing a claim under Article 3.5. We therefore consider the Panel to have
erred in its application of Article 3.5 of the Anti-Dumping Agreement.
5.3.4.1.2.3 Whether the Panel failed to consider impact as an essential building block for
any finding of causation
5.214. On appeal, Japan argues that the Panel's conclusion that the KTC need not establish a link
between volume and price effects under Article 3.2 and the impact of the dumped imports on the
domestic industry under Article 3.4 is wrong, and that the failure to establish this logical link
"undermine[d]" the KTC's causation finding. 555 Japan asserts that the Panel rejected Japan's
argument by focusing too narrowly on the requirements of Article 3.2 of the Anti -Dumping
Agreement concerning volume and price and on Article 3.4 of the Anti -Dumping Agreement
regarding impact, and not on the proper analysis under Article 3.5 regarding causation.556
5.215. Korea, in response, submits that this claim is "undeveloped" and "without merit" in light of
the Panel's clear findings.557 Korea contends that Japan does not explain what the Panel was required
to eval uate other than to examine whether the authorities evaluated the impact in line with

550 Japan contends that the legal standard is not whether the investigating authority has provided some
explanation that is "not unreasonable" when viewed in isolation. (Japan's appellant's submission, para. 284)
Rather, according to Japan, "the legal standard is whether the authority has reasonably explained why 'it
considers that the dumped imports affect domestic like product prices.'" (Japan's appellant's submission,
551 Panel Report, para. 7.294.
552 Japan's appellant's submission, para. 286. (italics original; underlining added)
553 Panel Report, para. 7.295.d. (emphasis added)
554 Japan's appellant's submission, para. 283.
555 Japan's appellant's submission, para. 293 (referring to Panel Report, paras. 7.330 and 7.347.b).
556 Japan's appellant's submission, para. 289.
557 Korea's appellee's submission, para. 441 (referring to Panel Report, paras. 7.329-7.330).

Article 3.4, or what a "proper" analysis would consist of.558 Instead, Korea points out that the Panel
made findings "which follow[ed] established WTO jurisprudence" inasmuc h as the Panel explained
that "the 'logical progression of inquiry' does not mean that the examination of impact under
Article 3.4 must be linked to the consideration under Article 3.2", but rather, "[t]hese two separate
inquiries can be undertaken indepen dently of each other, and brought together in the ultimate
determination under Article 3.5."559
5.216. We recall that the Panel here was considering Japan's claim 6 under Articles 3.1 and 3.5 of
the Anti-Dumping Agreement. Japan's claim rested on its argument that the KTC's failure to establish
a "logical link" between its evaluation of certain factors having a bearing on the state of the domestic
industry and its consideration of the volume of the dumped imports and the effect of the dumped
imports on prices under Article 3.2 for the purposes of its impact analysis under Article 3.4 rendered
its causation analysis inconsistent with Article 3.5. The Panel explained that, "[w]hile there may be
some overlap between the consideration of the effect of the dumped imports on domestic prices
under the second sentence of Article 3.2 and the evaluation of 'factors affecting domestic prices'
under Article 3.4", this does not mean that, as Japan seems to suggest, "a flawed price effects
analysis will necessarily preclude a proper examination of the impact of the dumped imports on the
domestic industry under Article 3.4."560 The Panel also rejected Japan's argument that, by failing to
examine two factors set out in Article 3.4, the Korean investigating authorities acted inconsistently
with Article 3.5.561 According to the Panel, since it had rejected the same argument with respect to
the separate claim raised by Japan under Article 3.4, "[f]or the reasons set forth in that section",
the Panel also rejected this argument under Article 3.5.562
5.217. We agree with the Panel that, "in order to properly examine the impact of dumped imports
on the domestic industry for purposes of Article 3.4, an investigating authority [is not required to]
link that examination with its consideration of the volume and the price effects of the dumped
imports."563 However, the Panel's analysis rejecting Japan's position described above is ultimately
based on its understanding of the relationship between the inquiries contemplated under Articles 3.2
and 3.4.564 Similarly, we do not see any reason to disagree with the Panel's finding that "there is no
need 'to undertake a fully reasoned causation and non-attribution analysis' as part of Article 3.4."565
Rather, the demonstration that subject imports are causing injury to the domestic industry "is an
analysis specifically mandated by Article 3.5".566 Thus, we do not consider Japan to have
demonstrated an "independent" violation of Article 3.5 of the Anti-Dumping Agreement on the basis
of its arguments that the Panel rejected. Nonetheless, the Panel's a bove analyses, including its
reliance on the findings it made with respect to the separate claim raised under Article 3.4, further
indicate that the Panel reviewed Japan's arguments in light of the requirement set out in Article 3.4
even though it was addr essing a causation claim under Article 3.5. Thus, as we see it, the Panel's
examination of the alleged flaws in the Korean investigating authorities' impact analysis primarily
relates to the issue of whether the KTC's impact examination was in line with th e requirements set
out in Article 3.4, as opposed to those under Article 3.5, which, as we have explained above, does
not foresee a panel revisiting the question whether an investigating authority's impact analysis is
consistent with Article 3.4. In so doi ng, the Panel effectively incorporated the requirements of
Article 3.4, rather than properly applying the requirements set out in Article 3.5, even though it was
reviewing a claim under Article 3.5. We therefore consider the Panel to have erred in applying
Article 3.5 of the Anti-Dumping Agreement.

558 Korea's appellee's submission, para. 440.
561 Panel Report, para. 7.325.
562 Panel Report, para. 7.325.
564 Panel Report, para. 7.330. The Panel also addressed Japan's arguments concerning the KTC's alleged
failure to demonstrate explanatory force of the dumped imports on the state of the domestic industry and to
properly take into account "positive" trends such that these considerations "disproved" the existence of causal
link between the dumped imports and injury to the domestic industry. However, the Panel rejected these
arguments. (Ibid., paras. 7.338-7.346) Japan has not challenged these findings on appeal in the context of its
"independent" causation claim.
566 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.205 (referring to
Appellate Body Report, China – GOES, para. 150).

5.3.4.1.3 Whether the Panel erred under Article 11 of the DSU and Article 17.6 of the
Anti-Dumping Agreement by failing to consider Japan's rebuttal arguments on the issue
of "reasonable sales price"
5.218. On appeal, Japan contends that, "in accepting the KTC['s] explanation for the diverging price
trends based on the constraints imposed by the so-called 'reasonable sales price', the Panel ignored
Japan's rebuttal arg uments about this issue." 567 Japan explains that "this issue became relevant
when Korea used the 'reasonable sales price' affirmatively to justify the causation finding of its
anti-dumping measure."568 In Japan's view, "[o]nce Korea offered this proposed defen se, Japan
challenged this defense at length and the Panel had an obligation under the standard of review to
address Japan's rebuttal."569 According to Japan, the legal standard is the same under both Article 11
of the DSU and Article 17.6 of the Anti-Dumping Agreement, and therefore the Panel ought to have
considered alternative explanations.570
5.219. In response, Korea submits that "Japan does not actually quote any of the Panel's findings
it considers to have been the result of a biased examination."571 Korea submits that Japan makes a
very serious accusation of bias by the Panel, based solely on the fact that the Panel did not deal with
a rebuttal argument by Japan.572 Korea states that "it is not sufficient under Article 11 [of the] DSU
to claim that a certain argumen t was not addressed; let alone that it would be sufficient to claim
that a Panel was biased simply because it allegedly did not address a 'rebuttal' argument." 573
Therefore, Korea submits that Japan has failed to demonstrate that the alleged disregard of thi s
rebuttal argument constituted an egregious error that calls into question the good faith of the
Panel.574 Korea also points out that "the reason why the Panel did not address this argument is
because Japan never made it in the context of its allegedly 'independent' causation claim."575
5.220. We recall that, under Article 11 of the DSU, a panel is required to consider all the evidence
presented to it, assess the credibility of such evidence, determine the weight thereof, and ensure
that the panel's factual findings have a proper basis in that evidence. 576 Within these parameters,
"it is generally within the discretion of the [p]anel to decide which evidence it chooses to utilize in
making findings."577 A claim that a panel has failed to conduct an "objective assessment o f the
matter before it" is "a very serious allegation".578 In a claim under Article 11 of the DSU, an appellant
must identify specific errors 579 that are so material that, "taken together or singly" 580, they
undermine the objectivity of the panel's assessment of the matter before it.581
5.221. In addition to Article 11 of the DSU, a panel reviewing a domestic authority's investigations
under the Anti-Dumping Agreement is also subject to the standard of review set out in Article 17.6
of that Agreement. With respect to a panel's assessment of facts, "[t]he aim of Article 17.6(i) is to
prevent a panel from 'second -guessing' a determination of a national authority when the
establishment of the facts is proper and the evaluation of those facts is unbiased and objec tive."582
Accordingly, "the task of a WTO panel is to examine whether the investigating authority has

567 Japan's appellant's submission, para. 295 (referring to Panel Report, para. 7.278; Japan's first
written submission to the Panel, paras. 97-99; second written submission to the Panel, para. 53).
568 Japan's appellant's submission, para. 295. (fn omitted)
569 Japan's appellant's submission, para. 295 (referring to Japan's second written submission to the
Panel, paras. 51-58; response to Panel question No. 98, paras. 48-51).
570 Japan's appellant's submission, para. 294.
571 Korea's appellee's submission, para. 447.
572 Korea's appellee's submission, para. 447.
573 Korea's appellee's submission, para. 447.
574 Korea's appellee's submission, para. 447.
575 Korea's appellee's submission, para. 447 (referring to Panel Report, para. 7.227).
576 Appellate Body Reports, China – Rare Earths, para. 5.178 (quoting Appellate Body Report,
Brazil – Retreaded Tyres, para. 185).
577 Appellate Body Reports, US – COOL, para. 299 (quoting Appellate Body Report, EC – Hormones,
para. 135).
578 Appellate Body Reports, China – Rare Earths, para. 5.227 (quoting Appellate Body Report,
EC – Poultry, para. 133).
579 Appellate Body Report, EC – Fasteners (China), para. 442.
580 Appellate Body Report, EC and certain member States – Large Civil Aircraft, para. 1318.
581 Appellate Body Reports, China – Rare Earths, para. 5.179. See also Appellate Body Report,
EC – Fasteners (China), para. 499.
582 Appellate Body Report, Thailand – H-Beams, para. 117.

adequately performed its investigative function, and has adequately explained how the evidence
supports its conclusions." 583 However, "in light of the standar d of review under the
Anti-Dumping Agreement, … it is not for a panel to conduct a de novo review of the facts of the case
or substitute its judgement for that of the investigating authority."584 Rather, "a panel must examine
'whether, in the light of the ev idence on the record, the conclusions reached by the investigating
authority are reasoned and adequate'."585
5.222. We note that, in connection with Japan's claim under Articles 3.1 and 3.2 of the
Anti-Dumping Agreement with respect to price effects, the Panel noted that "[t]he 'reasonable sales
price' is a target domestic industry price constructed by the OTI ."586 The Panel noted that "the OTI
appended two explanatory notes regarding the calculation of the reasonable sales price to the table
reporting comparisons between the actual price and the reasonable sales price."587 The explanatory
note that does not contain BCI states:
Note 1) Reasonable sales price = (manufacturing cost per unit + SG&A expenses per
unit)/(1-reasonable operating profit ratio)[.]588
5.223. The Panel further noted that "[i] n considering price suppression, the KTC referred to the
difference between the 'reasonable sales price' and the actual average domestic prices in the Final
Resolution."589 However, because the Panel found that Japan's claim under Articles 3.1 and 3.2 of
the Anti-Dumping Agreement with respect to price effects was outside its terms of reference, it did
not address Japan's argument that "[t] he Korean [investigating] authorities never explained why
the profit margins selected [to construct the reasonable sales price] were in fact a reasonable proxy
for the prices that the Korean producers should have been able to charge as 'reasonable sales
prices'."590
5.224. According to Japan, "[e]ven if … [it] did not focus on the 'reasonable sales price' as part of
its original argument about causation" under its "independent" claim under Articles 3.1 and 3.5, "this
issue became relevant when Korea used the 'reasonable sales price' affirmatively to justify the
causation finding of its anti -dumping measure."591 In support, Japan refers to paragraph 7.278 of
the Panel Report, but, as Korea correctly points out, "in that paragraph there is no discussion on the
use of 'reasonable sales price'."592 Rather, in that paragraph, the Panel compared the actual average
prices of dumped imports with th ose of domestic like products from 2010 to 2013, focusing, in
particular, on 2013. Therefore, we are unable to see the error in the Panel's analysis that Japan is
alluding to, especially when Japan did not make any arguments concerning the "reasonable sales
price" or explain its relevance in that context and in the overall context of its "independent" causation
claim.
5.225. Similarly, Japan contends that, although the Korean investigating authorities "described the
formula being used, they never explained the basis for choosing the benchmark 'reasonable
operating profit rate'". 593 In support, Japan refers to paragraphs 7.475 and 7.477 of the
Panel Report. These paragraphs, however, contain the description of the "Relevant facts" underlying
Japan's claim concerning disclosure of essential facts pursuant to Article 6.9 of the
Anti-Dumping Agreement, as opposed to facts relating to Japan's claim 6 under Articles 3.1 and 3.5
of the An ti-Dumping Agreement. We thus fail to see how the facts described in the paragraphs
referenced by Japan relate to the objectivity of the Panel's assessment of Japan's "independent"

583 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.255.
584 Appellate Body Report, Russia – Commercial Vehicles, para. 5.102 (referring to Appellate Body
Reports, US – Washing Machines, para. 5.258; US – Steel Safeguards, para. 299; Argentina – Footwear (EC),
585 Appellate Body Report, Russia – Commercial Vehicles, para. 5.102 (quoting Appellate Body Report,
US – Washing Machines, para. 5.258, in turn quoting Appellate Body Report, US ‒ Softwood Lumber VI
(Article 21.5 – Canada), para. 93).
586 Panel Report, para. 7.116.
587 Panel Report, para. 7.116.
588 Panel Report, para. 7.116 (quoting OTI's Final Report (Panel Exhibit KOR-2b (BCI)), p. 57).
589 Panel Report, para. 7.117.
590 Japan's appellant's submission, para. 296.
591 Japan's appellant's submission, para. 295.
592 Korea's appellee's submission, para. 447.
593 Japan's appellant's submission, para. 296 (referring to Panel Report, paras. 7.475 and 7.477).

causation claim such that the Panel could be said to have erred under Article 11 of the DSU and
Article 17.6(i) of the Anti-Dumping Agreement.
5.226. For these reasons, we reject Japan's claim that the Panel failed to "respect the proper
standard of review" and acted inconsistently with Article 11 of the DSU and Article 17.6(i) of the
Anti-Dumping Agreement.594
5.227. We now turn to address the claims raised by Korea in its other appeal concerning the Panel's
findings on price comparability and o verselling in the context of Japan's "independent" causation
claim.
5.3.4.1.4 Whether the Panel erred in its findings concerning price comparability and
overselling when addressing Japan's claim 6 under Articles 3.1 and 3.5 of the
Anti-Dumping Agreement
5.228. To recall, Japan advanced three grounds in support of its claim that the KTC's analysis of
the price effects of dumped imports "independently" undermined its causation determination under
Article 3.5 because: (i) there was a divergence between the trends in prices of dumped imports and
domestic like product; (ii) dumped imports consistently and significantly oversold the domestic like
product; and (iii) there was no competitive relationship between the dumped imports and the
domestic like product, such that their prices were not comparable.595 In section 5.3.4.1.2.2 above,
we have reviewed Japan's appeal of the Panel's findings regarding the first ground.
5.229. With respect to the third ground, concerning price comparability, in the context of the
transaction-to-average comparisons, the Panel noted that the KTC found price suppression and price
depression based, inter alia, on individual transactions in which certain models of the dumped
imports sold or offered to certain customers were priced lower than the average price of a
corresponding model of the domestic like product. 596 The Panel considered that, in light of the
possible effect on the comparisons made, an unbiased and reasonable investigating authority could
not have properly compared these individual transaction prices w ith the average domestic like
product price of a corresponding model without further consideration and explanation of the
relevance or significance of the different time periods and quantities involved in these
transactions.597 The Panel noted that the KTC r elied on the price differentials in these comparisons
in finding that dumped imports had price-suppressing and -depressing effects on domestic prices,
which in turn was one of the bases for its ultimate determination under Article 3.5.598 The Panel
concluded that the KTC acted inconsistently with Articles 3.1 and 3.5 of the
Anti-Dumping Agreement by failing to ensure price comparability.599
5.230. With respect to the second ground, regarding price overselling, the Panel considered that
"whether the fact of consistent average price overselling demonstrates that the KTC's determination
of causation was inconsistent with Articles 3.1 and 3.5 cannot be separated from a consideration of
whether the KTC's overall analysis of price effects is reasonable, in light of the consistent average
price overselling by the dumped imports ."600 The Panel considered that, w hile individual instances
of "underselling" by dumped imports may indeed indicate price -suppressing or -depressing effects
on the domestic like product prices as a whole, it questioned whether the KTC's analysis was
sufficiently "robust to support its conclusions".601 In particular, the Panel found that it was not clear
that the KTC considered whether, and if so how, the individual instances of "underselling" with
respect to certain models affected "the prices of other models of the domestic like product, the
extent of total domestic sales affected by such 'underselling', or how these instances of 'underselling'

594 Japan's appellant's submission, para. 297.
595 Panel Report, para. 7.259.
596 Panel Report, para. 7.270 (referring to KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 19).
597 Panel Report, para. 7.271.
598 Panel Report, para. 7.272.
599 Panel Report, para. 7.272.
601 Panel Report, para. 7.303.

affected domestic like product prices as a whole". 602 The Panel also considered that examples or
isolated instances of aggressive pricing behaviour will not, standing alone, suffice to support a finding
of price-suppressing and -depressing effects of dumped imports on domestic like product prices as
a whole.603
5.231. As we see it, the Panel's findings with respect to the issues of price comparability and price
overselling are closely linked, inasmuch as the KTC relied on the relevant price comparisons to find
price effects on the domestic like product as a whole, while dismissing the argument concerning the
consistent overselling by the dumped imports. Indeed, as noted by the Panel, "[t]he KTC rejected
this argument because, in its view, the average price overselling was the result of the differential
pricing of dumped imports for different models or options and to different customers." 604 Instead,
"the KTC focused on: (a) the lower prices of certain [imported] products to certain customers; and
(b) the 'strengthened marketing activities' of the related importer SMC Korea as the two bases of its
finding on price effects." 605 Ultimately, the Panel found that the KTC acted inconsistently with
Articles 3.1 and 3.5 because: (i) the KTC failed to ensure price comparability in the transaction -to-
average comparisons due to the different time periods and quantities involved 606; and (ii) the KTC
failed to explain how and why a subset of transactions for certain models was sufficient to establish
price effects for the domestic like product as a whole, notwithstanding the consistent average price
overselling by the dumped imports.607
5.232. On appeal, Korea advances two main grounds, claiming that: (i) the Panel relieved Japan of
its burden to demonstrate that the KTC failed to ensure price comparability and, instead, made the
case for Japan608; and (ii) the Panel imposed a price comparison requirement not found in Article 3.5
of the Anti-Dumping Agreement and that is more demanding than the standard under Article 3.2 of
the Anti-Dumping Agreement.609
5.233. Korea's arguments thus centre on the issue of price comparability and call upon us to first
examine the relevance of price comparability in the context of an investigating authority's injury
determination under Article 3 of the Anti -Dumping Agreement. We recall that Article 3.1 provides
that a determination of injury shall be based on positive evidence and involve an objective
examination of "the effect of t he dumped imports on prices in the domestic market for like
products".610 Article 3.2, second sentence, lists three price effects that are distinct from each other,
in that, even if prices of the dumped imports do not significantly undercut those of the domestic like
products, such imports may nevertheless have a price-suppressing or -depressing effect on domestic
prices.611 Article 3.2, second sentence, as the Panel also noted 612, does not, however, prescribe
specific methodologies as to how an investigating authority is to consider whether there has been a
significant price undercutting, price suppression, or price depression. Under Article 3.2, second
sentence, an investigating authority therefore has a measure of discretion in how it chooses to
assess price ef fects. The Appellate Body found, however, that "a failure to ensure price
comparability" could not be considered to be consistent with the requirement under Article 3.1 that
"a determination of injury be based on 'positive evidence' and involve an 'objective examination' of,
inter alia, the effect of subject imports on the prices of domestic like products". 613 Thus, "if subject
import and domestic prices were not comparable, this would defeat the explanatory force that
subject import prices might have for the depression or suppression of domestic prices." 614 For this

602 Panel Report, para. 7.303. The Panel recalled that WTO panels have considered that "a finding of
price depression in a situation where dumped imports oversell the domestic like product requires an
explanation of how the investigating authorities reached a conclusion of price depression in such a situation."
(Ibid., fn 420 to para. 7.303 (referring to Panel Reports, China – Autos (US), para. 7.272; China – Cellulose
Pulp, para. 7.86))
603 Panel Report, para. 7.318.
604 Panel Report, para. 7.300.
606 Panel Report, para. 7.272.
607 Panel Report, para. 7.322.
608 Korea's other appellant's submission, paras. 197-207.
609 Korea's other appellant's submission, paras. 208-226.
610 Emphasis added.
611 Appellate Body Report, China – GOES, para. 137.
612 Panel Report, para. 7.266.
613 Appellate Body Report, China – GOES, para. 200.
614 Appellate Body Report, China – GOES, para. 200. (fn omitted)

reason, the Appellate Body stated that "[a]s soon as price comparisons are made, price
comparability necessarily arises as an issue."615
5.234. These considerations suggest that, to the extent that an investigating authority relies on
price comparisons in its consideration of price effects of subject imports, price comparability needs
to be ensured. Thus, where an investigating authority fails to ensure price comparability in price
comparisons between dumped imports and the domestic like product, this undermines its findings
of price effects under Article 3.2, to the extent that it relies on such price comparisons.
5.235. With these considerations in mind, we address each of Korea's arguments, starting with
whether the Panel unduly relieved Japan of its burden of demonstrating that the KTC failed to ensure
price comparability.
5.3.4.1.4.1 Whether the Panel erred in law by unduly relieving Japan of its burden of
demonstrating that the KTC failed to ensure price comparability
5.236. Korea submits that the two aspects of the KTC's price -effects analysis that the Panel took
issue with, namely (i) the KTC's comparison of individual transactio n prices with average sales
prices; and (ii) the KTC's justification of its price suppression and price depression findings in light
of the average price overselling by the dumped imports, "are different from the question of price
comparability that was raised by Japan and should thus not have been examined by the Panel given
the lack of a prima facie case developed by Japan in this respect".616 Korea recalls that, before the
Panel, Japan challenged the competitive relationship between the dumped imports and the domestic
like products, arguing that the two products were not in competition with each other in the Korean
market for various reasons. 617 Korea submits that the Panel rejected Japan's argument that there
was no competitive relationship between the two p roducts and concluded, "in unequivocal terms,
that '[t]he verified instances in which the dumped imports were sold at prices lower than those of
the domestic like product support the view that there was competition in the Korean market for
valves'".618 Thus, Korea submits that, with Japan failing to make its prima facie case against the
existence of competition between the dumped imports and the domestic like product, and thus
against the price comparability between the dumped and domestic products, "the Pane l's analysis
should have ended right there."619 By continuing to examine the issue of price comparability, Korea
contends that "[t]he Panel shifted the burden of proof to Korea on a technical point that was not
developed by Japan."620
5.237. Japan, for its part, cont ends that, contrary to Korea's argument, Japan did not limit its
arguments to the existence of a general competitive relationship between dumped imports and the
domestic like products. Therefore, according to Japan, the Panel correctly noted that Japan had
stressed the points about price comparability in its arguments. 621 Furthermore, Japan argues that
ensuring price comparability is an essential part of any proper finding of price effects under the
second sentence of Article 3.2 or of causation under Article 3.5.622 Japan contends that Korea
misinterprets the obligation of the "effect of dumped imports on prices" under the second sentence
of Article 3.2, and of a finding of "causing injury" under Article 3.5. Japan avers that the effect of
dumped imports on dom estic prices, and ultimately the question whether dumped imports are
"causing injury", can be determined properly only when the investigating authority ensures that the
prices being analysed are, in fact, comparable.623
5.238. Korea's contentions are based on the p remise that Japan's arguments before the Panel
concerning price comparability were limited to Japan's view that there was a lack of competitive
relationship, or substitutability, between the dumped imports and domestic like products. In Korea's
view, Japan 's arguments do not encompass the issue of comparability between the specific
transactions on which the Korean investigating authorities relied in reaching their finding of price

615 Appellate Body Report, China – GOES, para. 200 (quoting Panel Report, China – GOES, para. 7.530).
616 Korea's other appellant's submission, para. 198.
617 Korea's other appellant's submission, para. 201 (referring to Panel Report, para. 7.259).
618 Korea's other appellant's submission, para. 201 (quoting Panel Report, para. 7.295.c).
619 Korea's other appellant's submission, para. 202.
620 Korea's other appellant's submission, para. 198. (emphasis original)
621 Japan's appellee's submission, para. 94.
622 Japan's appellee's submission, para. 93.
623 Japan's appellee's submission, para. 93.

suppression and price depression, which in turn was one of the bases for finding causation. However,
the Panel, as we recall, noted Japan's argument that, in its price-effects analysis, the KTC failed to
ensure price comparability between specific products or product segments o f the dumped imports
and the domestic like product.624 The Panel specifically noted Japan's contention that "the KTC 'failed
to consider the comparability of products it used to reach its conclusions of price depression and
suppression, and equally failed to conduct an objective examination of the overall extent of price
competition between subject imports and domestic products '."625 Although Japan used the term
"comparability of products", Japan also alluded to the KTC's failure to conduct an objective
examination of the overall extent of price competition. For example, Japan contended before the
Panel that the KTC never explained in its reports how the conclusions of price suppression and price
depression were supported by the comparison between the prices of subject imports and the
"high-end prices" of domestic like products. 626 In so doing, Japan, in our view, made out a prima
facie case regarding the requirement on the KTC to ensure price comparability in its price -effects
analysis under Article 3.2, second sentence. The Panel's understanding of Japan's arguments is thus
well founded in view of the applicable requirements under Article 3.2, second sentence , which
concerns price effects of dumped imports on the domestic like product.
5.239. Moreover, we note that it is undisputed that "the KTC undertook price comparisons."627 In its
price suppression and price depression analyses, the KTC compared, inter alia, individual resale
transaction prices of the dumped imports to the average price of the corresponding model of the
domestic like product, and concluded that the "sales price of the dumped products was much lower
than the average sales price in the case of certain products or customers for which the degree of
competition with the domestic indu stry was fierce". 628 Ultimately, the KTC relied on the price
differentials in these comparisons in finding that dumped imports had price -suppressing
and -depressing effects on domestic prices, which in turn was one of the bases for its ultimate
determination of causation under Article 3.5.629 In light of Japan's argument that the KTC failed to
conduct an objective examination of the overall extent of price competition in reaching its price
suppression and price depression findings, the Panel correctly considere d that, to the extent an
investigating authority's consideration of price suppression or price depression may involve
comparison of prices, the investigating authority must ensure that the prices being compared are
properly comparable. 630 However, the Panel' s above analysis was more directly relevant in the
context of Article 3.2, second sentence, rather than in that of Article 3.5. In so doing, the Panel
effectively incorporated the requirements of Article 3.2, rather than applying properly the
requirements set out in Article 3.5, even though the Panel was reviewing a claim under the latter
provision. While we consider that the Panel's above findings pertain to a proper application of the
requirements under Article 3.2, we find that they nonetheless constitute an error in the application
of Article 3.5 of the Anti-Dumping Agreement.
5.3.4.1.4.2 Whether the Panel erred in law by imposing a price comparison requirement
not contained under either Article 3.2 or Article 3.5 of the Anti-Dumping Agreement
5.240. Korea recalls that Article 3.5 of the Anti-Dumping Agreement refers to the effects of dumping
"as set forth in paragraphs 2 and 4". Korea submits that, even assuming arguendo that this reference
can be read as importing the obligation that is contained in Article 3.2 of the
Anti-Dumping Agreement regarding the effects of the dumped imports on prices, "it cannot be read
to introduce specific obligations about the method to be used when conducting this price effects
analysis."631 Korea recalls that, with respect to the KTC's consideration that certain sales of the
dumped import models took place at prices below the average or high -end prices of the
corresponding models of the domestic like product, the Panel found that "an unbiase d and
reasonable investigating authority could not have properly compared these individual transaction
prices with the average domestic like product price of a corresponding model, without further

624 Panel Report, para. 7.264.
625 Panel Report, para. 7.264 (quoting Japan's second written submission to the Panel, para. 17).
(emphasis added)
626 Japan's comments on Korea's response to Panel question No. 88, para. 33.
627 Panel Report, para. 7.267.
628 Panel Report, para. 7.267.b (quoting KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 19).
629 Panel Report, para. 7.272.
630 Panel Report, para. 7.266.
631 Korea's other appellant's submission, para. 208.

consideration and explanation of the relevance or significance of these differences."632 Korea submits
that, in the context of an Article 3.2 consideration of the price effects of the dumped imports, "there
is no basis for requiring such an additional analysis when no price undercutting finding is made."633
5.241. In response, Japan submits that the Panel properly applied the requirements of Articles 3.1
and 3.5 of the Anti-Dumping Agreement, and faulted the KTC for failing to recognize the extent to
which the evidence of pervasive overselling of the domestic like product as a whole fatally
undermined the KTC's finding of causation.634 Japan submits that Korea's argument "misunderstands
the obligations under Articles 3.1 and 3.5 and their relationship to the 'price effects' analysis required
by Article 3.2".635 Japan contends that the Panel correctly focused on the need to base conclusions
about price suppression and price depression on the prices of the domestic like product as a whole.636
Japan submits that the KTC noted the price overselling but, contrary to Korea's assertions, i gnored
the consistency and the significance of the overselling and did not discuss at all the implications of
this fact for its analysis of price suppression. 637 Japan explains that the KTC failed to discuss the
implications of these key facts.638 Consequently, the KTC failed to explain how the subject imports
had any explanatory power for the alleged suppression of the domestic prices. 639 Thus, Japan
submits that these failures seriously undermined the KTC's conclusions about price suppression and,
ultimately, about causation.640
5.242. As noted, Korea's arguments centre on the issue of price comparability in the context of an
injury determination under Article 3 of the Anti-Dumping Agreement. Korea's arguments rest on the
premise that there is no obligation under Article 3.2 to ensure price comparability, so long as an
investigating authority does not make a finding of price undercutting. We have explained above that
Article 3.2, second sentence, lists three price effects that are distinct from each other, in that, even
if prices of the dumped imports do not significantly undercut those of the domestic like products,
such imports may nevertheless have price-suppressing or -depressing effects on domestic prices.641
We have also recalled the Appellate Body's finding that "a fa ilure to ensure price comparability"
cannot be considered to be consistent with the requirement under Article 3.1 that "a determination
of injury be based on 'positive evidence' and involve an 'objective examination' of, inter alia, the
effect of subject i mports on the prices of domestic like products". 642 Thus, as the Appellate Body
stated, "[a]s soon as price comparisons are made, price comparability necessarily arises as an
issue."643 Accordingly, we have noted that, to the extent an investigating authority relies on price
comparison in its consideration of price effects of dumped imports, price comparability needs to be
ensured. Thus, where an investigating authority fails to ensure p rice comparability in undertaking
price comparisons between dumped imports and the domestic like product, this would undermine
its finding of price suppression or depression under Article 3.2, to the extent that it relies on such
price comparisons and not only when a finding of price undercutting is made, as Korea suggests.
5.243. In the present dispute, the Panel's findings challenged by Korea relate to the KTC's findings
of price suppression and price depression pursuant to Article 3.2, second sentence. The Pan el, as
we recall, described the context in which the KTC relied on the transaction -to-average price
underselling analysis and the "strengthened marketing activities" as follows:
In the present case, interested parties argued during the domestic investigati on that
the fact that average dumped import prices were higher than those of the domestic like
product throughout the period of trend analysis precluded a finding of price suppression
or price depression. The KTC rejected this argument because, in its view , the average
price overselling was the result of the differential pricing of dumped imports for different
models or options and to different customers. Instead, the KTC focused on: (a) the

632 Korea's other appellant's submission, para. 215 (referring to Panel Report, para. 7.271).
633 Korea's other appellant's submission, para. 215.
634 Japan's appellee's submission, para. 106.
635 Japan's appellee's submission, para. 106.
636 Japan's appellee's submission, para. 101.
637 Japan's appellee's submission, para. 113.
638 Japan's appellee's submission, para. 113.
639 Japan's appellee's submission, para. 113.
640 Japan's appellee's submission, para. 113.
641 Appellate Body Report, China – GOES, para. 137.
642 Appellate Body Report, China – GOES, para. 200.
643 Appellate Body Report, China – GOES, para. 200 (quoting Panel Report, China – GOES, para. 7.530).

lower prices of certain products to certain customers; and (b) the "strengthened
marketing activities" of the related importer SMC Korea as the two bases of its finding
on price effects.644
5.244. The Panel thus understood the Korean investigating authorities to have considered that
individual cases of dumped import resale prices for some models that were lower than average
domestic prices and high -end domestic prices for corresponding models to certain customers
(i.e. individual instances of "underselling") led to price suppression and price depression of the
domestic like product.645 In this respect, we note that the Korean investigating authorities conducted
and relied on these price comparisons, including evidence of price discrimination and aggressive
pricing behaviour, to make the point that, despite the higher average prices o f the imported
products, a finding of price suppression and price depression could nonetheless be sustained by the
evidence.646 Similarly, the KTC examined and relied on the instances of price underselling to find
that they "had the effect of suppressing increases in the price of the like product or causing decreases
thereof".647
5.245. The Panel set out in a table what Korea referred to as a series of comparisons between
individual resale transaction prices of two models of dumped imported valves and the average prices
of corresponding models of the domestic like product reported in the OTI's Final Report. This table
underlined those transactions in which the dumped import price to certain customers was lower than
the average domestic price for the corresponding mode l produced and sold by the Korean
producers.648 The Panel found that the listed transactions "took place on different dates and involved
different quantities".649 The Panel observed that, in general, the lower the quantity involved in a
transaction, the higher the unit price of the dumped imported valve(s). The Panel took the view that,
in light of the possible effect on the comparisons made, an unbiased and reasonable investigating
authority could not have properly compared these individual transaction prices with the average
domestic like product price of a corresponding model without further consideration and explanation
of the relevance or significance of these differences. 650 The Panel found that the evidence before it
did not suggest that either the KTC or t he OTI made any effort to consider differences or their
potential consequences for price suppression and price depression in the determination of material
injury caused by dumped imports, thereby casting doubt on the validity of these comparisons.651
5.246. According to Korea, the Panel was wrong to rely on the above -mentioned table as an
"exclusive basis" to find fault with the KTC's price-effects analysis, because the table was nothing
more than an indicator of the Japanese respondents' strategic low pricing that the KTC then went
on to examine in more detail. 652 However, we note that the Korean investigating authorities relied
on the outcome of these comparisons and, later, on the outcome of similar comparisons concerning
13 "representative models" to find price-suppressing and -depressing effects of the dumped imports.
Indeed, as Korea stated before the Panel, "when SMC Korea [sold] the identical dumped product
model to different customers" applying "widely different sales prices", it was "undercutting prices of
domestic like product in individual transactions where it compete[d] with domestic producers"653 and
thus "force[d] domestic producers to react to the fierce competition from dumped imports by

645 Panel Report, para. 7.302 (referring to OTI's Final Report (Panel Exhibit KOR-2b (BCI)), pp. 100-101;
Korea's response to Panel's question No. 88(b), para. 19; Record Data on the Dumped Imports' Individual
Resale Transaction (Panel Exhibit KOR-57 (BCI))). The Panel clarified that it used the term "underselling" as
"shorthand" for the situation in which "prices of a model of dumped imports in certain transactions were lower
than those of the corresponding domestic like product" as opposed to price undercutting, which is one of the
three price effects mentioned in the second sentence of Article 3.2 of the Anti-Dumping Agreement. (Ibid.,
fn 419 to para. 7.302)
647 Panel Report, para. 7.300 (quoting KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 19).
(emphasis omitted)
648 Panel Report, para. 7.270 and Table 1 (referring to OTI's Final Report (Panel Exhibit KOR-2b (BCI),
pp. 100-101)).
649 Panel Report, para. 7.271.
650 Panel Report, para. 7.271.
651 Panel Report, para. 7.271.
652 Korea's opening statement at the oral hearing.
653 Korea's response to Panel question no. 88, para. 22 (referring to OTI's Final Report (Panel Exhibit
KOR-2b (BCI)), pp. 99-101 and fn 60).

reducing prices of domestic like product". 654 Moreover, the Panel recognized that "[i]n its Final
Report, the OTI listed 'underselling' transactions for two models" 655 and that , later on, "Korea
provided [Panel] Exhibit KOR-57, a list of comparisons of the prices of all of the resale transactions
of the Japanese respondent SMC Korea during 2013 with the average and high-end prices of the
corresponding models of the domestic like product."656
5.247. The KTC's transaction-to-average comparison analysis was thus aimed at assessing whether
the prices of dumped imports were lower than the prices of domestic like products for determining
price effects within the meaning of Article 3.2, second sentence. Price comparability thus became an
important issue as the probative value o f the comparison depended on the degree of price
comparability and concerned the objectivity and evidentiary foundation of the KTC's price
suppression and price depression findings under Articles 3.1 and 3.2. We agree with the Panel that
the KTC was required to ensure price comparability in these price comparisons inasmuch as it relied
on the price differentials to find that dumped imports had price-suppressing and -depressing effects
on domestic prices. However, the Panel's above analysis was pertinent to a claim under Article 3.2,
and in line with the requirements of that provision, rather than to a claim under Article 3.5, where
a panel 's task consists of reviewing an investigating authority's ultimate injury and causation
determination.
5.248. Korea further ar gues that, in examining the KTC's findings concerning the consistent
overselling of dumped imports, the Panel found that "a 'sufficiently robust' analysis" must include
"considerations as to 'whether, and if so how, … individual instances of "underselling" with respect
to certain models affected the prices of other models of the domestic like product, the extent of total
domestic sales affected by such "underselling", or how these instances of "underselling" affected
domestic like product prices as a whole'". 657 Korea submits that the Panel thus "impos[ed] a
requirement to demonstrate how and to what extent underselling in certain competitive sales
affected the prices of the domestic like product 'as a whole' or 'overall'", and that such a requirement
has no basis in either Article 3.2 or Article 3.5 of the Anti-Dumping Agreement.658
5.249. In response, Japan submits that the Panel did not impose an unreasonable burden on the
Korean investigating authorities. Rather, acc ording to Japan, "[t]he Panel simply required some
reasonable explanation grounded in facts that showed isolated examples of what were dissimilar
transactions were in fact relevant to a finding of price effects for the product as a whole." 659 Japan
submits that the Panel correctly focused on the need to base conclusions about price suppression
and price depression on the prices of the domestic like product as a whole, since a finding of price
effects for a subset of the domestic like products cannot be applied to all of the other domestic like
products without positive evidence.660
5.250. We note that the KTC relied on individual instances of "underselling" to address the argument
by the interested parties that the consistent overselling by dumped imports based on the average
price would undermine findings of price suppression and price depression. In response to such an
argument, the KTC relied on the transaction-to-average comparison analysis and the "strengthened
marketing activities".661 As noted by the Panel, the KTC found that "the sales price of the dumped
products was much lower than the average sales price" in the case of "certain products or customers

654 Korea's response to Panel question no. 88, para. 23.
656 Panel Report, para. 7.305. We examine Korea's arguments challenging the Panel's examination of
Panel Exhibit KOR-57 in section 5.3.4.1.5 below.
657 Korea's other appellant's submission, para. 204 (quoting Panel Report, para. 7.303).
658 Korea's other appellant's submission, para. 222. See also ibid., para. 205.
659 Japan's appellee's submission, para. 100. (fn omitted)
660 Japan's appellee's submission, para. 101.
661 We note that Korea accepts that "[i]n response to arguments about lack of competition between the
imported and domestic products as evidenced by the relatively high degree of overselling, [the] KTC examined
the extent to which the fact that the average sales price of the dumped imports was higher than that of the like
product undermined its conclusion about the price suppressive effects of the dumped imports." (Korea's other
appellant's submission, para. 237) Korea also accepts that the OTI found many examples of cases where
imported products were actually resold or offered for resale to customers in Korea at prices similar to or even
lower than the domestic sales price of the like product. (Ibid., para. 238)

for which the degree of competition with the domestic industry was fierce, which had the effect of
suppressing increases in the price of the like product or causing decreases thereof".662
5.251. The KTC thus introduced and relied on the evidence regarding the individual instances of
"underselling" in order to respond to the interested parties' arguments concerning the existe nce of
price overselling based on the average prices of all the products. The KTC reached the conclusion
that these individual instances of "underselling" had the effect of suppressing and depressing the
prices of domestic like product despite the overall overselling by the dumped imports. In assessing
whether the KTC provided sufficient reasoning for the above conclusions, the Panel found that "it is
not clear" that the KTC considered whether, and if so how, the individual instances of "underselling"
with respect to certain models affected "the prices of other models of the domestic like product, the
extent of total domestic sales affected by such 'underselling', or how these instances of 'underselling'
affected domestic like product prices as a whole".663
5.252. In response to Korea's argument that Panel Exhibit KOR -57 demonstrated how the KTC
considered the extent to which the domestic like product prices were affected by individual instances
of dumped imports' pricing, the Panel queried whether Panel Exhibit KOR-57, in conjunction with the
OTI's Final Report 664 and the KTC's Final Resolution, supported Korea's contention. 665 The Panel
noted that Panel Exhibit KOR -57 is a list of 115,524 transactions that reports the product code,
series, date, quantity, value, and unit price of resale transactions of certain models of the dumped
imports, and the average price and the high-end price of corresponding models of the domestic like
product.666 The Panel observed that "[w]here the transaction resale price of the dumped imports is
lower than the average price or the high -end price of the domestic like product, a notation of
'undercutting' is recorded for the particular transaction."667 The Panel considered that Panel Exhibit
KOR-57 shows that "the OTI compared dumped import resale prices in a large number of
transactions in 2013 with the average price and the high -end price of the corresponding models of
the domestic like product."668 Apart from the above, the Panel found that "[Panel] Exhibit KOR -57
does not contain any other narrative."669 Ultimately, the Panel found that "[t]he mere fact that there
are some instances of 'underselling', even if there are many of them, does not necessarily indicate
that the prices of the domestic like product is suppressed or depressed as a whole as a result."670
5.253. Although the Panel spoke of price suppression or depression of the domestic like product "as
a whole", we do not consider the Panel to have imposed a legal requirement " to demonstrate how
and to what extent underselling in certain competitive sales affected the prices of the domestic like
product 'as a whole'", as Korea argues. 671 Rather, in the context of this case, the Panel examined
the KTC's determination and, on that basis, "[understood] the KTC [to have] found [that] the effects
of these individual instances were on domestic like product prices as a whole, and not only on the
prices of certain models of the domestic like product". 672 Indeed, the Panel noted the KTC to have
stated:
The Commission finds that the dumped products suppressed price increases of the like
product and caused decreases thereof, although the average sales price of the dumped
products was higher than that of the like product.
The average sales price of the dumped products was higher due to their price
differentiation in accordance with models, option details or customers, but it was found
that the sales price of the dumped products was much lower than the average sales
price in the case of certain products or customers for which the degree of competition
with the domestic industry was fierce, which had the effect of suppressing increases in

662 Panel Report, para. 7.300 (quoting KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 19).
(emphasis added by the Panel)
664 OTI's Final Report (Panel Exhibit KOR-2b (BCI)).
665 Panel Report, para. 7.309.
666 Panel Report, para. 7.310.
667 Panel Report, para. 7.310.
668 Panel Report, para. 7.310.
669 Panel Report, para. 7.310.
671 Korea's other appellant's submission, para. 222.
672 Panel Report, para. 7.302.

the price of the like product or causing decreases thereof. It was investigated that SMC
Korea … consistently expanded its sales organizations and used its dominant position to
attract distribution agents or discourage defections of its distribution agents, and thus
the domestic industry had to respond to such strengthened marketing activities of SMC
Korea and become forced to decrease the sales price or refrain from increasing prices.673
5.254. As we see it, this is the context in which the Panel analysed Panel Exhibit KOR-57 and found
that it does not show whether, and if so how, the Korean investigating au thorities examined the
extent to which domestic like product prices were affected by the individual instances of lower
dumped import prices, noting further that "this Exhibit does not identify the corresponding models
of the domestic like product whose prices are being 'undersold', or the quantity or value of the sales
of those models."674 Indeed, without such information it is not clear how the Korean investigating
authorities could have assessed the extent to which domestic like product prices were affected by
the pricing of the dumped imports in the selected transactions , such that a finding of price
suppression and price depression could be reached. 675 Nor could the Panel have refrained from
examining whether the KTC took into account in its considerations and explanations the evidence of
consistent price overselling and the relevant arguments raised by the interested parties. 676
Especially, when the Panel rightly recognized that "[c]onsideration of such questions would seem
particularly warranted in the presen t case in light of the consistent … overselling by the dumped
imports and the fact that the average prices of the models of dumped imports involved in these
individual instances of 'underselling' were still higher than the average prices of the correspondi ng
domestic models."677 In the present dispute, we agree with the Panel that "[a]n explanation and
analysis of how and to what extent the prices of the domestic like product are affected [was]
necessary."678
5.255. However, consistent with our considerations above, w e find that the Panel's analysis was
pertinent to a claim under Article 3.2, and in line with the requirements of that provision, rather
than to a claim under Article 3.5. We note that the Panel inquired whether "the KTC's finding of a
causal relationship based in part on price suppressing and depressing effects of dumped imports, in
light of consistent average price overselling by dumped imports, is one that could have been reached
by a reasonable and objective investigating authority on the basis of the e vidence and arguments
before the KTC." 679 Our review indicates that the outcome of the Panel's inquiry depended on a
proper analysis that applied the requirements under Article 3.2, second sentence, concerning the
interplay between the price effects found and the average price overselling observed with respect to
the dumped imports, as opposed to an analysis under Article 3.5. While we do not find any error in
the Panel's analysis insofar as it relates to the applicable requirements set out in Article 3.2, the
Panel effectively incorporated and applied the requirements of Article 3.2, rather than properly
applying the requirements set out in Article 3.5, even though it was reviewing a claim under
Article 3.5. As noted, under Article 3.5, a panel is called upon to review whether the investigating
authority properly linked the outcomes of its analyses conducted pursuant to Articles 3.2 and 3.4,
taking into account the evidence and factors required under Article 3.5, in coming to a definitive
determination regarding the causal relationship between dumped imports and injury to the domestic
industry. We therefore consider the Panel to have erred in its application of Article 3.5 of the
Anti-Dumping Agreement.
5.3.4.1.5 Whether the Panel failed to make an objective assessment of the matter under
Article 11 of the DSU and Article 17.6 of the Anti-Dumping Agreement
5.256. On appeal, Korea raises several arguments under Article 11 of the DSU and Article 17.6(i)
of the Anti-Dumping Agreement with respect to the Panel's substantive findings under Articles 3.1
and 3.5 of the Anti -Dumping Agreement concerning Japan's "independent" claim of causation. We
address each of these arguments in turn.

673 Panel Report, para. 7.300 (quoting KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 19).
(emphasis added by the Panel)
674 Panel Report, para. 7.310.
675 Panel Report, para. 7.310.
676 Panel Report, para. 7.299.
677 Panel Report, para. 7.303. (emphasis original; fn omitted)
679 Panel Report, para. 7.301.

5.257. First, Korea asserts that Japan's claim concerned the lack of competition between the
imported and the domestic like products. Korea notes that the Panel rejected that claim and found
in favour of Korea in this respect.680 Korea submits that the Panel then "constructed" another claim
that wa s not developed by Japan concerning the lack of "fair comparison" as a result of the
transaction-to-average comparison of certain prices. 681 Therefore, Korea submits that, "[i]n so
doing, the Panel made the case for Japan, determining that a violation existed based on a claim that
was never made or developed, in violation of Article 11 of the DSU."682
5.258. We recall that we have already addressed Korea's arguments in support of its claim that the
Panel erred in law by unduly relieving Japan of its burden to demonstr ate that the KTC failed to
ensure price comparability between the dumped imports and the domestic like products in its
price-effects analysis.683 In support of its present claim under Article 11 of the DSU, Korea makes
the same arguments. Therefore, Korea's claim under Article 11 of the DSU is subsidiary to its claim
concerning the Panel's failure to construe or apply correctly provisions of a covered agreement, in
this case Articles 3.1 and 3.5 of the Anti-Dumping Agreement.684
5.259. Next, Korea asserts that the Pa nel "re-constructed [the] KTC's price effects analysis" by
suggesting that the KTC made findings of price undercutting for the product and turned the price
comparisons that were made to corroborate other information on the record into a determinative
element of the price -effects analysis.685 In so doing, Korea contends that "the Panel engaged in a
de novo analysis in violation of Article 17.6 of the Anti-Dumping Agreement."686
5.260. We do not, however, find Korea to have pointed out the relevant passages from the
Panel Report that, in its view, demonstrate that the Panel "re -constructed [the] KTC's price effects
analysis". Nor do we find Korea to have articulated and substantiated its claim with specific
arguments. To the contrary, we recall that the Panel specifically noted that "the KTC did not find
price undercutting."687 We are therefore not convinced that Korea has made out a case that the
Panel engaged in a de novo analysis in violation of Article 17.6(i) of the Anti-Dumping Agreement.
5.261. Korea further submits that the Panel focused exclusively on the evidence relating to the
instances of aggressive pricing and underselling, and disregarded all of the other evidence that was
actually relied on by the Korean investigating authorities to support their finding of price suppression
and price depression, including the evidence corroborating the existence of competition. 688 Thus,
Korea contends that "[t]o reduce the price effects analysis effectively to a comparison of transaction-
to-average prices and examples of strategic marketing, in the way the Panel did, is neither objective
nor fair" when seen from the purview of Article 11 of the DSU and Article 17.6 of the
Anti-Dumping Agreement.689
5.262. In response, Japan submits that Korea provides no specifics at all.690 Japan avers that Korea
alleges evidence was ignored but does not cite to a single specific piece of allegedly ignored
evidence.691 Thus, according to Japan , "[i]t is not at all clear what 'evid ence' Korea means in
connection with its Article 11 claim."692

680 Korea's other appellant's submission, para. 263.
681 Korea's other appellant's submission, para. 263.
682 Korea's other appellant's submission, para. 263.
683 See section 5.3.4.1.4.1 above.
684 See Appellate Body Report, US – Anti-Dumping and Countervailing Duties (China), para. 337
(referring to Appellate Body Reports, US – Steel Safeguards, para. 498; Australia – Apples, para. 406).
685 Korea's other appellant's submission, para. 263.
686 Korea's other appellant's submission, para. 263.
687 Panel Report, para. 7.269 (referring to KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 18;
Korea's first written submission to the Panel, para. 128).
688 Korea's other appellant's submission, para. 264.
689 Korea's other appellant's submission, para. 264.
690 Japan's appellee's submission, para. 142.
691 Japan's appellee's submission, para. 142.
692 Japan's appellee's submission, para. 142.

5.263. The Appellate Body has stated that for a challenge under Article 11 of the DSU to succeed,
an appellant must identify specific errors regarding the objectivity of the panel's assessment. 693 It
is therefore "incumbent on a participant raising a claim under Article 11 … to explain why the alleged
error meets the standard of review under that provision".694 However, in this instance, while Korea
argues that "the Panel willfully ignored and disregarded ce rtain evidence that was presented by
Korea supporting the determination of the dumped imports' price effects" 695, Korea fails to identify
the evidence that the Panel allegedly ignored and disregarded. Nor do we find Korea to have
explained why it considers the Panel to have conducted a de novo review inconsistently with
Article 17.6(i) of the Anti -Dumping Agreement. Korea's argument that the Panel erred under
Article 17.6(i) is the same as that presented in support of its claim under Article 11 of the DSU.696
We are therefore not convinced that Korea has made a case for finding a violation of Article 11 of
the DSU or Article 17.6(i) of the Anti-Dumping Agreement.
5.264. Next, Korea contends that the Panel made findings that were internally inconsistent and
contradictory.697 Korea submits that the Panel found, in paragraph 8.3 of the Panel Report, that
Japan did not demonstrate that the causation analysis that the KTC made was inconsistent with
Articles 3.1 and 3.5 of the Anti -Dumping Agreement.698 Korea notes that the Panel made a similar
finding of "no inconsistency with respect to the second important aspect of a causation analy sis,
relating to the examination of other known factors and non -attribution".699 However, Korea avers
that "without any explanation of how these contradictory and internally inconsistent findings can be
squared", the Panel found, in paragraph 8.4 of the Panel Report, that the "causation analysis, as a
result of flaws in their analysis of the effect of the dumped imports on prices in the domestic market",
violated Articles 3.1 and 3.5.700
5.265. In response, Japan submits that this argument by Korea ignores the fact that the Panel was
addressing three separate claims, each with a distinct focus.701 Japan explains that its "claim 4 about
causal relationship focused specifically on the lack of any correlations or any other evidence
necessary to support a finding of causatio n", whereas, its "claim 5 about other factors focused on
the distinct obligation of non -attribution."702 According to Japan, "[t]hese claims both relate to
causation, but do not overlap or supersede Japan's claim 6 about the ultimate conclusion about
'causing injury' notwithstanding the findings under Articles 3.2 and 3.4."703
5.266. We recall that before the Panel, Japan raised three claims with respect to Articles 3.1 and 3.5
of the Anti-Dumping Agreement. The Panel did not follow the sequence in which Japan listed these
claims and, instead, commenced its evaluation with claim 6, i.e. the "independent" causation claim,
followed by its evaluation of claims 4 and 5, respectively. The Panel then made a separate finding
with regard to each of these claims. With respect to claim 4, Japan contended that the existence of
any causal relationship between the dumped imports and the alleged injury was undermined because
of insufficient correlation between the volume trends, price trends, profit trends, and the state of
the domestic industry.704 The Panel, in our view, correctly noted that this claim focuses on "the
alleged failure to demonstrate the existence of a causal relationship between dumped imports and
injury to the domestic industry" 705, in support of which Japan argued that "there is a lack of
correlation in the trends of volumes, prices, and profits." 706 With respect to claim 5, Japan argued
that the KTC acted inconsistently with Articles 3.1 and 3.5 "because Korea failed to consider

693 Appellate Body Report, US – Carbon Steel (India), para. 4.79 (referring to Appellate Body Report,
EC – Fasteners (China), para. 442).
694 Appellate Body Report, US – Carbon Steel (India), para. 4.79 (quoting Appellate Body Reports,
China – Rare Earths, para. 5.178, in turn quoting Appellate Body Report, EC – Fasteners (China), para. 442
(emphasis original)).
695 Korea's other appellant's submission, para. 264.
696 See Korea's other appellant's submission, paras. 285-286.
697 Korea's other appellant's submission, para. 265.
698 Korea's other appellant's submission, para. 265.
699 Korea's other appellant's submission, para. 265.
700 Korea's other appellant's submission, para. 265.
701 Japan's appellee's submission, para. 143 (referring to Korea's other appellant's submission,
para. 261).
702 Japan's appellee's submission, para. 143.
703 Japan's appellee's submission, para. 143.
704 Panel Report, para. 7.351.
705 Panel Report, para. 7.233.
706 Panel Report, para. 7.234.

adequately all known factors other than the imports under investigation that were injuring the
domestic industry at the same time and therefore incorrectly attributed injury caused by these other
factors to the imports under investigation".707 As the Panel noted, this claim by Japan concerned the
KTC's evaluation of non -attribution factors under " the distinct obligation regarding non -attribution
analysis, as set forth in the third and fourth sentences of Article 3.5".708 The Panel's overall findings
in paragraphs 8.3.b and 8.3.c 709 of the Panel Report concerned these two claims, respectively.
Finally, the Panel's finding in paragraph 8.4.a710 was with respect to Japan's claim 6, that the KTC's
causation determination was undermined by its flawed analysis of the price effects, "irrespective and
independent" of whether the Panel found the KTC's analysis of price effects to be inconsistent with
Article 3.2 of the Anti-Dumping Agreement. For these reasons, we are not convinced that the Panel
made internally inconsistent findings such that it acted inconsistently with Article 11 of the DSU.
5.267. Korea further contends that "even at the very basic level of the Panel's analysis of the facts
relating to the price comparisons and … overselling, the Panel's analysis is not supported by the
facts on the record and reflects a disregard of relevant, material evidence." 711 Korea submits that
the biggest disregard of relevant evidence was committed by the Panel when it found that the "KTC
did not find price undercutting" and thus, "the KTC did not rely on the results of any price
comparisons between the average dumped import prices and the average domestic like product
prices in injury determination."712 Korea submits that, although it is true that the KTC did not find
price undercutting, that does not mean that the KTC's comparison of average dumped import prices
and average domestic like product prices cannot serve any purpose in its price suppression
analysis.713 Korea submits that it raised a timely objection against this error in its Comments on the
Interim Report of the Panel but the Panel "simply disregarded the parties' comments"714, and thereby
erred under Article 11 of the DSU.715
5.268. In response, Japan submits that the Panel did not ignore the point regarding the comparison
of average price trends.716 Japan submits that Korea is trying to create an issue where none exists.
According to Japan, in the part of the Panel Report referenced by Korea 717, the Panel specifically
referred to the KTC's finding of price undercutting in the sense of the second sentence of
Article 3.2.718 Japan explains, "[s]ince there was no KTC finding of price undercutting, there was no

707 Panel Report, para. 7.236 (quoting Japan's panel request, p. 2).
708 Panel Report, para. 7.238.
709 The Panel found:
With respect to those of Japan's claims that are within our terms of reference as set forth in
paragraph 8.2 above, we conclude that Japan has not demonstrated that the Korean
Investigating Authorities acted inconsistently with:
…
b. Articles 3.1 and 3.5 of the Anti-Dumping Agreement with respect to their conclusion that the
dumped imports, through the effects of dumping, were causing injury to the domestic industry;
and
c. Articles 3.1 and 3.5 of the Anti-Dumping Agreement with respect to their examination of
known factors other than the dumped imports that were injuring the domestic industry at the
same time.
(Panel Report, paras. 8.3.b-c) (emphasis original)
710 The Panel found:
With respect to those of Japan's claims that are within our terms of reference as set forth in
paragraph 8.2 above, we further conclude that Japan has demonstrated that the Korean
Investigating Authorities acted inconsistently with:
a. Articles 3.1 and 3.5 of the Anti-Dumping Agreement in their causation analysis as a result of
flaws in their analysis of the effect of the dumped imports on prices in the domestic market[.]
(Panel Report, para. 8.4.a) (emphasis original)
711 Korea's other appellant's submission, para. 266.
712 Korea's other appellant's submission, para. 268 (quoting Panel Report, para. 7.269).
713 Korea's other appellant's submission, para. 268.
714 Korea's other appellant's submission, para. 270 (referring to Korea's Comments on the Interim
715 Korea's other appellant's submission, para. 271.
716 Japan's appellee's submission, para. 146.
717 Japan's appellee's submission, para. 146 (referring to Korea's other appellant's submission, fn 190 to
718 Japan's appellee's submission, para. 146 (referring to Panel Report, para. 7.269).

need for Japan to challenge or the Panel to address price comparability with regard to a method of
analyzing price effects under the second sentence of Article 3.2 that the KTC did not use."719
5.269. We recall that the Panel noted that the KTC, in its price undercutting analysis, compared
average dumped import prices to average domestic like product prices and concluded that dumped
imports had not been sold at lower prices than the domestic like product, that is, there was no price
undercutting.720 The Panel observed that the KTC did not find price undercutting and thus, "the KTC
did not rely on the results of any price comparisons between the average dumped import prices and
the average domestic like product prices in its injury determination." 721 The Panel made this
observation in the context of price undercutting and the relevance of such a finding with respect to
the ultimate determination of injury to the domestic industry. Because the KTC made no price
undercutting finding, it was logical that the Panel stated so. I mportantly, in that light, the Panel
considered that there was no need to decide whether the prices in those average -to-average
comparisons were properly comparable. 722 However, in considering the issue of diverging price
trends, we note that the Panel took into account the average-to-average comparisons when it found
the KTC's explanations regarding the diverging price trends in 2011 -2012 and 2012 -2013 to be
reasonable.723 We are therefore not convinced that Korea has demonstrated that the Panel acted
inconsistently with Article 11 of the DSU on this count.
5.270. Next, Korea recalls that it submitted Panel Exhibit KOR -57 to demonstrate how the KTC
considered the extent to which the domestic like product was affected by individual instances of
dumped imports' pricing .724 Korea explains that Panel Exhibit KOR -57 constituted the entire data
sheet on the basis of which the KTC conducted its transaction-to-average price comparisons for the
purpose of its price suppression and price depression analysis.725 Korea avers that the Panel correctly
determined that Panel Exhibit KOR-57 was properly before it, but found that "[Panel] Exhibit KOR-57
does not, in itself, sufficiently demonstrate whether and how the OTI conducted the simulations and
analyses, and reached the relevant conc lusions as argued by Korea." 726 Korea submits that "the
Panel was not even handed in its approach and applied an excessive degree of certainty and proof,
refusing to draw any inferences from [Panel Exhibit] KOR -57" and thus admitted only what was
immediately apparent from Panel Exhibit KOR-57.727
5.271. In response, Japan submits that "the Panel correctly rejected Korea's efforts to present
post hoc justifications with no basis in the KTC Determination as written."728 Japan argues that "the
data and analysis contained i n [Panel] Exhibit KOR -57 were not mentioned in the KTC's Final
Resolution or the OTI's Final Report."729 Japan adds that "even assuming arguendo the data in [Panel
Exhibit] KOR-57 were actually 'examined' during the investigation", the KTC's examination did not
address "the counterfactual question of whether the domestic prices would have been higher if the
dumped imports had been at the normal value". 730 Japan further submits that "if [Panel]
Exhibit KOR-57 revealed anything about price effects, it showed that the alleged instances of
average-price-based price undercutting occurred only within a small proportion of the domestic like

719 Japan's appellee's submission, para. 146.
720 Panel Report, para. 7.267.a (referring to KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 18).
721 Panel Report, para. 7.269.
722 Panel Report, para. 7.269.
723 Panel Report, paras. 7.278-7.279.
724 Korea's other appellant's submission, para. 272.
725 Korea's other appellant's submission, para. 272. We recall that the Panel set out in a table what
Korea referred to as a series of comparisons between individual resale transaction prices of models of dumped
imported valves and the average prices of corresponding models of the domestic like product reported in the
OTI's Final Report. The OTI underlined those transactions in which the dumped import price to certain
customers was lower than the average domestic price for the corresponding model produced by the Korean
726 Korea's other appellant's submission, para. 274 (quoting Panel Report, para. 7.313 (emphasis
original)).
727 Korea's other appellant's submission, para. 277.
728 Japan's appellee's submission, para. 147.
729 Japan's appellee's submission, para. 148 (referring to Japan's comments on Korea's response to
Panel question No. 88, para. 26).
730 Japan's appellee's submission, para. 148 (referring to Japan's comments on Korea's response to
Panel question No. 88, para. 27).

products" and "the KTC never linked isolated examples to the product as a whole." 731 Thus, Japan
contends that it had pointed out that Panel Exhibit KOR-57 is deeply flawed.732
5.272. We have considered above the Panel's discussion of Panel Exhibit KOR -57 and agreed with
the Panel's reading of that Exhibit.733 To recall, the Panel explained that Panel Exhibit KOR-57 shows
that "the OTI compared dumped import resale prices in a large number of transactions in 2013 with
the average price and the high -end price of the corresponding models of the domestic like
product."734 However, the Panel found that Panel Exhibit KOR-57 does not show whether, and if so
how, the OTI examined the extent to which domestic like product prices were affected by the
individual instances of lower dumped import prices, noting that "this Exhibit does not identify the
corresponding models of the domestic like product whose price s are being 'undersold', or the
quantity or value of the sales of those models."735 Therefore, the Panel considered that it is not clear
how the Korean investigating authorities could have assessed the extent to which domestic like
product prices were affected by the pricing of the dumped imports in the transactions concerned.736
5.273. That said, Korea's contention is that it would have been perfectly logical for the Panel to
consider that the KTC, after having been rigorous enough to compare and check every one of the
115,524 resale transaction prices of the dumped imports in 2013 with the average and high -end
prices of the corresponding domestic model, could be assumed to take the next step of conducting
a simple wrap -up calculation to arrive at the observations as explained by Korea in its other
appellant's submission.737 Thus, Korea's argument that the Panel did not draw those conclusions
that Korea suggested is squarely directed towards the Panel's weighing of evidence and the probative
value accorded by the Panel to Panel Exhibit KOR -57. In making this argument, Korea essentially
suggests that the Panel should have accorded to Panel Exhibit KOR-57 the same evidentiary weight
that it would itself have accorded to it. The Appellate Body has consistently recognized that panels
enjoy a margin of discretion in their assessment of the facts 738, which includes the discretion of a
panel to decide which evidence it chooses to utilize in making its findings 739, and to determine how
much weight to attach to the various items of evidence placed before it by the parties to the case.740
The Panel did not commit an error under Article 11 of the DSU simply because it declined to accord
to the evidence the weight that Korea believes should have been be accorded to it.741
5.274. Korea also contends that the Panel erred under Article 17.6(i) of the Anti-Dumping
Agreement when it examined Japan's price-related issues under claim 6 in a de novo manner by,
inter alia: (i) "creating and applying specific and excessively demanding requirements that must be
met in an overselling situation"; and (ii) "imposing isolated findings on the authorities which it then
examined independently and irrespectively of the analysis provided by [the] KTC".742
5.275. In response, Japan submits that the Panel did not create excessively demanding
requirements.743 Japan adds that the Panel properly focused on what the KTC and the OTI had
actually said about their analyses.744 Japan further submits that the Panel did not impose any isolated
findings, noting that Korea does not present any arguments to support this allegation.745
5.276. Both of Korea's above arguments form the basis of separate claims that Korea has raised on
appeal. We recall in this regard that Korea has challenged the Panel's findings on the grounds that:

731 Japan's appellee's submission, para. 148 (referring to Japan's comments on Korea's response to
Panel question No. 88, para. 27). (fn omitted)
732 Japan's appellee's submission, para. 148.
733 See section 5.3.4.1.4.2 above.
734 Panel Report, para. 7.310.
735 Panel Report, para. 7.310.
736 Panel Report, para. 7.310.
737 Korea's other appellant's submission, para. 277.
739 Appellate Body Report, EC – Hormones, para. 135.
740 Appellate Body Report, Korea – Dairy, para. 137.
Korea – Alcoholic Beverages, para. 164.
742 Korea's other appellant's submission, para. 282.
743 Japan's appellee's submission, para. 153.
744 Japan's appellee's submission, para. 153.
745 Japan's appellee's submission, para. 155.

(i) the Panel unduly relieved Japan of its burden of demonstrating that the KTC failed to ensure price
comparability746; (ii) the Panel imposed a price comparison requirement under Article 3.5 that is not
based on the text of Article 3.5 and is more demanding than what is required under Article 3.2747;
and (iii) the Panel found a violation under Articles 3.1 and 3.5 based on a partial analysis of the
KTC's price-effects analysis that was made.748 In the context of those claims, Korea has argued that
the Panel examined different aspects of the price -effects findings of the KTC in clinical isolation 749;
the Panel imposed groundless analytical requirements, which, for most part, are excessively
burdensome and impractical 750; the Panel imposed an additional obligatio n of rigor in a price
comparison analysis when no such rigor was required751; the Panel unduly focused on one aspect of
the analysis relating to the explanatory force of the dumped imports concerning the examples of
marketing practices and pricing 752; and the Panel found the KTC's price-effects analysis to be
inconsistent with Article 3.5 based solely on concerns over particular aspects of one part of the
price-effects analysis, in isolation from all other evidence and findings made.753 We have addressed
these claims and arguments above. We recall that the Appellate Body has found that "a claim under
Article 17.6(i) should not be made merely subsidiary to a claim that the panel erred in its application
of a WTO provision."754 In our view, Korea's claim tha t the Panel erred under Article 17.6(i) of the
Anti-Dumping Agreement on the grounds described in paragraph 5.274 above is subsidiary to its
earlier claims contending that the Panel erred in its application of Article 3.5 of the
Anti-Dumping Agreement.
5.277. Finally, Korea contends that the Panel examined the price -related claim of Japan under
Articles 3.1 and 3.5 of the Anti-Dumping Agreement in a de novo manner by "creating and using its
own tables of the price trends, such as in figures 1 -4" and thus acted inconsistently with
Article 17.6(i) of the Anti-Dumping Agreement.755
5.278. Japan submits that there is nothing wrong with the Panel taking data on the Panel record
and presenting graphs to illustrate what the numbers show.756 According to Japan, the graphs simply
provide a visualization of the data; they do not change the data and, therefore, there is nothing
de novo about converting data to graphs.757
5.279. We observe that the so urce for Figures 1758 and 2759 in the Panel Report is the KTC's Final
Resolution, which is not disputed by Korea. Figure 3 760 in the Panel Report is sourced from Korea's
first written submission to the Panel, which is also not disputed by Korea. Neither do we understand
Korea to dispute the source of the data contained in Figure 4 in the Panel Report, which, as the Panel
stated, was derived from Panel Exhibit KOR -58.761 Thus, Korea does not take issue with the
correctness of the underlying data that the Panel used in presenting Figures 1 through 4 in the
Panel Report, nor does Korea contend that, in presenting the Figures, the Panel misrepresented the
underlying data. Accordingly, we fail to see how the Panel acted in a de novo manner inconsistently
with Article 17.6(i) of the Anti-Dumping Agreement.
5.3.4.1.6 Conclusion with respect to claim 6
5.280. With respect to a claim under Article 3.5, a panel is tasked with reviewing an investigating
authority's ultimate demonstration that "dumped imports are, through the effects of dumping , as

746 Korea's other appellant's submission, paras. 197-207.
747 Korea's other appellant's submission, paras. 208-226.
748 Korea's other appellant's submission, paras. 227-243.
749 Korea's other appellant's submission, para. 214.
750 Korea's other appellant's submission, para. 215.
751 Korea's other appellant's submission, para. 218.
752 Korea's other appellant's submission, para. 223.
753 Korea's other appellant's submission, para. 228.
754 Appellate Body Report, US – Anti-Dumping Methodologies (China), para. 5.47. (emphasis original)
755 Korea's other appellant's submission, para. 282.
756 Japan's appellee's submission, para. 154.
757 Japan's appellee's submission, para. 154.
758 Panel Report, Figure 1: Trends in average prices, p. 80.
759 Panel Report, Figure 2: Trends in market share, p. 81.
760 Panel Report, Figure 3: Price trends of representative models, p. 82.
761 Panel Report, Figure 4: Comparison between the average prices of the dumped imports and the
domestic like product on representative models basis, p. 93 (referring to Record Data and Analysis on the
Representative Model (Panel Exhibit KOR-58 (BCI))).

set forth in paragraphs 2 and 4 ," causing injury to the domestic industry. In so doing, a panel is
called upon to review whether the investigating authority properly linked the outcomes of its
analyses conducted pursuant to Articles 3.2 and 3.4, taking into account the evidence and factors
required under Article 3.5, in coming to a definitive determination regarding the causal relationship
between dumped imports and injury to the domestic industry. A panel's review does not, however,
call for revisitin g the question whether each of the interlinked components of this determination
itself meets the applicable requirements set out in Article 3.2 or Article 3.4. Examining such
consistency in the context of a claim under Article 3.5 would effectively require a panel to incorporate
and apply obligations and disciplines set out in other paragraphs of Article 3, which are not contained
in the text of Article 3.5. We agree with Korea that the phrase "through the effects of dumping, as
set forth in paragraphs 2 and 4" in Article 3.5 "is not a call [for a panel] to re-do the examination[s]"
under Articles 3.2 and 3.4 of the Anti-Dumping Agreement.762
5.281. In the present dispute, under claim 6, Japan alleged that the KTC's causation determination
was undermined by its flawed analyses of the volume of the dumped imports, the price effects, and
the impact of the dumped imports on the state of the domestic industry, "irrespective and
independent" of whether the Panel found the KTC's analyses of volume, price effects, and impact to
be inconsistent with Articles 3.2 and 3.4 of the Anti-Dumping Agreement.
5.282. In addressing claim 6, the Panel first considered Japan's arguments with respect to the
volume of dumped imports. The Panel noted that "Japan's allegation that certain flaws in the KTC's
analysis of the volume of dumped imports 'independently' undermine [d] its causation
determination"763 was based on the fact that: (i) the volume of dumped imports decreased during
two years of the three -year period of tr end analysis; and (ii) the volume of dumped imports
increased only modestly in absolute terms and decreased in terms of market share in 2013 compared
with 2010.764 The Panel rejected these arguments and found that Japan failed to demonstrate that
the Korean investigating authorities acted inconsistently with Articles 3.1 and 3.5 of the
Anti-Dumping Agreement. In so doing, the Panel reviewed the Korean investigating authorities'
analysis pursuant to the requirements set out in Article 3.2, first sentence, as o pposed to those
under Article 3.5. Thus, in reviewing the causation claim at issue, the Panel effectively incorporated
the requirements in Article 3.2, first sentence, rather than properly applying the requirements set
out in Article 3.5, in its assessment of the causation claim at issue. We therefore consider the Panel
to have erred in its application of Article 3.5.
5.283. With respect to price effects in the context of claim 6, before the Panel, Japan advanced
three grounds in support of its claim that the KTC's analysis of the price effects of the dumped
imports "independently" undermined its causation determination, namel y that: (i) there was
divergence between the trends in dumped import and domestic like product prices; (ii) dumped
imports consistently and significantly oversold the domestic like product; and (iii) there was no
competitive relationship between the dumped imports and the domestic like product, such that their
prices were not comparable.765 The Panel found that the KTC acted inconsistently with Articles 3.1
and 3.5 of the Anti -Dumping Agreement by "failing to ensure price comparability, in terms of the
dates and sales quantities involved, when it compared the individual transaction prices of certain
models of dumped imports with the average prices of corresponding models of the domestic like
product".766 Concerning overselling, the Panel found that the Korean investigating authorities failed
to explain adequately their consideration of the price-suppressing and -depressing effects of dumped
imports in their determination of causation, in light of the undisputed fact that the prices of the
dumped imports were higher than those of the domestic like product throughout the period of trend
analysis, and therefore acted inconsistently with Articles 3.1 and 3.5.767 As for diverging price trends,
the Panel found that the different magnitude of the price decreases from 2012 to 2013 and the
opposing price movements from 2011 to 2012 d o not, in and of themselves, demonstrate that the
KTC's determination of a causal relationship was inconsistent with Articles 3.1 and 3.5.768
5.284. To the extent that an investigating authority relies on price comparisons in its consideration
of the price effects of dumped imports, price comparability needs to be ensured. Thus, where an

762 Korea's other appellant's submission, para. 185.
763 Panel Report, para. 7.250.
764 Panel Report, para. 7.251.
765 Panel Report, para. 7.259.
766 Panel Report, para. 7.272.
767 Panel Report, para. 7.322.
768 Panel Report, para. 7.296.

investigating authority fails to ensure price comparability in price comparisons between dumped
imports and the domestic like products, this undermines its findings of price effects under Article 3.2,
to the extent that it relies on such price comparisons. We agree with the Panel that the KTC was
required to ensure price comparability in its price comparisons inasmuch as it relied on the price
differentials in these comparisons to find that dumped imports had price -suppressing
and -depressing effects on the domestic like product. Likewise, we agree with the Panel that, given
the consistent overselling by the dumped imports and the fact that the average prices of the models
of dumped imports involved in the individual instances of "underselling" were higher than the
average prices of the corresponding domestic models, an explanation and analysis of how and to
what extent the prices of the domestic like product are affected was necessary. That said, our review
of the Panel's findings indicates that , for each of these arguments, the analyses carried out by the
Panel were pertinent to a claim under Article 3.2 and were in lin e with the requirements of that
provision, rather than to a claim under Article 3.5. In so doing, the Panel effectively incorporated
the requirements of Article 3.2, rather than properly applying the requirements set out in Article 3.5,
even though it was reviewing a claim under the latter provision . With respect to a claim under
Article 3.5, a panel's review does not call for revisiting the question whether each of the interlinked
components of the causation determination itself meets the applicable requirements set out under
their respective provisions, such as, the consideration of price effects under Article 3.2. We therefore
consider the Panel to have erred in its application of Article 3.5.
5.285. Finally, with respect to the examination of the impact of dumped imports in the context of
claim 6, before the Panel, Japan relied on its argument that, because the KTC did not establish any
logical connection between the effects of the dumped imports under Article 3.2 and the condition of
the domestic industry for the purpose of its impact analysis under Article 3.4, its causation
determination was undermined.769 The Panel found that "'the logical progression of inquiry' does not
mean that the examination of impact under Article 3.4 must be linked to the consideration under
Article 3.2."770 We agree with the Panel that, in order to examine the impact of dumped imports on
the domestic industry properly for purposes of Article 3.4, an investigating authority is not required
to link that examination with its consideration of the volume and the price effects of the dumped
imports.771 Similarly, we agree with the Panel's finding that "there is no need 'to undertake a fully
reasoned causation and non -attribution analysis' as part of Article 3.4."772 However, the Panel's
examination of the alleged flaws in the Korean investigating authorities' impact analysis prim arily
relates to the issue of whether the KTC's impact examination was in line with the requirements set
out in Article 3.4, as opposed to Article 3.5. In so doing, the Panel effectively incorporated the
requirements of Article 3.4, rather than properly applying the requirements set out in Article 3.5,
even though it was reviewing a claim under the latter provision. Article 3.5 does not foresee a panel
revisiting the question whether an investigating authority's impact analysis is consistent with
Article 3.4. We therefore consider the Panel to have erred in its application of Article 3.5.
5.286. In light of the foregoing considerations, with respect to claim 6, we reverse the Panel's
finding, in paragraph 8.4.a of the Panel Report, that Japan has demonstrated that the Korean
investigating authorities acted inconsistently with Articles 3.1 and 3.5 of the A nti-Dumping
Agreement in their causation analysis as a result of flaws in their analysis of the effect of the dumped
imports on prices in the domestic market.
5.3.4.2 Japan's claim 4
5.3.4.2.1 Whether the Panel erred in its approach to resolving Japan's claim 4 about the
failure to demonstrate a causal relationship focusing on the lack of co rrelation among
various factors
5.287. Before the Panel, Japan argued that the KTC failed to demonstrate that the dumped imports
were causing injury to the domestic industry since there was insufficient correlation between the
volume trends, price trends, and profit trends and the state of the domestic industry to support the

769 Japan's first written submission to the Panel, para. 195 (referring to ibid., section V.D).
770 Panel Report, para. 7.329 (quoting Appellate Body Report, China – GOES, para. 128). (fn omitted)
771 Panel Report, para. 7.330.

existence of a causal relationship between the dumped imports and the injury to the domestic
industry.773
5.288. The Panel found that Japan's arguments concerning volume trends and price trends were
identical to its volume and price -effects-related arguments under its "independent" causation
claim.774 On the basis of the same considerations, the Panel dismissed these arguments.775 Turning
to Japan's arguments concerning profit trends, the Panel found that Japan failed to establish that
insufficient correlation between dumped imports and trends in domestic -industry profits suffices to
demonstrate that a reasonable and unbiased investigating authority could not have properly found
the required causal relationship between the dumped imports and injury to the domestic industry in
light of the facts and arguments that were before the KTC. 776 Ultimately, the Panel concluded that
Japan failed to demonstrate that the Korean investigating authorities acted inconsistent ly with
Articles 3.1 and 3.5 of the Anti -Dumping Agreement by failing to demonstrate that the dumped
imports, through the effects of dumping, were causing injury to the domestic industry.777
5.289. On appeal, Japan contends that the Panel dismissed Japan's argument s about volume
correlation and price correlation by simply citing its own earlier findings on Japan's "independent"
causation claim.778 Japan submits that "[t]he first claim was about price/volume effect analysis or
impact analysis, but the second claim was not."779 Japan's avers that its "basic point was simply that
the lack of sufficient correlation – that domestic industry volume and price trends did not correlate
well with the import volume and price trends" and, therefore, "called into doubt the existence of any
causal relationship". 780 Japan avers that its arguments in support of this claim relied on the
Appellate Body's findings regarding the relevance of conditions of competition or correlation among
trends when drawing inferences about causation in trade remedy cases.781
5.290. Korea, for its part, submits that, " [o]ther than a mere assertion about the Panel's alleged
'misinterpretation' of the Appellate Body guidance, Japan does not develop any legal arguments with
respect to the Panel's analysis."782 Korea notes that Japan argues that the Panel "improperly refused
to address the lack of correlation", but this, according to Korea, suggests that Jap an should have
brought a claim under Article 11 of the DSU.783
5.291. We recall that the analysis under Article 3.5 concerns the demonstration of "the causal
relationship between subject imports and injury to the domestic industry". 784 This demonstration
shall be based on "an examination of all relevant evidence before the authorities". We agree with
the Panel that evidence that does not fall squarely within the parameters of Articles 3.2 and 3.4 may
nevertheless be relevant and persuasive with respect to whether a ca usal relationship can be
demonstrated under Article 3.5.785 A coincidence in time between upward trends in imports and a
decline in the performance indicators of the domestic industry could be evidence of the existence of
a causal link between increasing imports and material injury to the domestic industry. 786 However,
while such a coincidence, by itself, cannot prove causation, its absence would create serious doubts
as to the existence of a causal link and would require a very compelling analysis of why causation is
still present.787 Thus, the existence of a correlation, though indicative, is by no means dispositive of
the existence of a causal link. Moreover, a lack of correlation does not preclude a finding that a
causal link exists, provided that a very compelling explanation is provided.

773 Panel Report, para. 7.351.
774 Panel Report, paras. 7.353 and 7.356.
775 Panel Report, paras. 7.353 and 7.356.
776 Panel Report, para. 7.360.
777 Panel Report, para. 7.361.
778 Japan's appellant's submission, para. 299 (referring to Panel Report, paras. 7.353 and 7.356).
779 Japan's appellant's submission, para. 299.
780 Japan's appellant's submission, para. 300. (fn omitted)
781 Japan's appellant's submission, para. 299 (referring to Appellate Body Reports, US – Tyres (China),
para. 192; Argentina – Footwear (EC), para. 144; Panel Report, China – X-Ray Equipment,
paras. 7.239-7.248).
782 Korea's appellee's submission, para. 449 (quoting Japan's appellant's submission, para. 299).
783 Korea's appellee's submission, para. 449 (quoting Japan's appellant's submission, para. 299).
784 Appellate Body Report, China – GOES, para. 147. (emphasis original)
785 Panel Report, para. 7.248.
786 Appellate Body Report, US – Tyres (China), para. 192.
787 See Appellate Body Report, Argentina – Footwear (EC), para. 144.

5.292. That said, with respect to the alleged lack of correlation in volume trends, the Panel noted
that Japan contended that the existence of any causal relationship between the dumped imports and
the alleged injury was undermined because: (i) the volume and the market share of the dumped
imports decreased from 2010 to 2012 (i.e. during the first two years of the three -year period of
trend analysis); and (ii) the domestic industry's market share remained stable in 2013 as compared
with 2010. 788 In the context of Japan's "independent" causation claim, the Panel reviewed and
rejected these two effectively identical arguments advanced by Japan in support of its allegation
that certain flaws in the KTC's analysis of the volume of dumped im ports "independently"
undermined its causation determination. 789 On the basis of the same considerations, the Panel
dismissed these arguments in the context of the present claim.790
5.293. We have considered above that, in addressing Japan's volume -related arguments in the
context of claim 6, the Panel reviewed the requirements under Article 3.2, first sentence, as opposed
to those under Article 3.5. We have explained that, in reviewing Japan's claim 6, the Panel effectively
incorporated the requirements of Article 3.2, first sentence, rather than properly applying the
requirements set out in Article 3.5. As further discussed above, in reviewing a claim under
Article 3.5, a panel is not called upon to revisit the question whether each of the interlinked
components of this determination, such as the investigating authority's volume analysis, is itself
consistent with the applicable requirements set out in Article 3.2. Given that the Panel relied on the
same considerations in rejecting Japan's arguments concerni ng the lack of correlation in volume
trends in the context of the causation claim at issue (claim 4), we find the Panel's finding in this
regard to be in error.
5.294. With respect to price trends, Japan submits that, whether measured based on simple
averages or the price fluctuation index method, prices followed very different trends. From 2011
to 2012, subject import prices increased while domestic prices decreased, whereas from 2012
to 2013, subject import prices fell sharply, but domestic prices fell only sli ghtly.791 These diverging
price trends, according to Japan, did not suggest the necessary causal relationship.792
5.295. In response, Korea submits that the KTC considered the development in prices of both the
dumped imports and the domestic like products in a dynami c manner over the entire POI,
year-by-year and end-point to end-point, using average import and resale prices as well as a price
fluctuation index.793 Korea contends that, on the basis of this comprehensive analysis, the KTC
observed strong indications of pr ice effects by the dumped imports on domestic prices throughout
the entire POI, including in 2012 and 2013. 794 Korea also submits that, for these last two years of
the POI, there were no "widely diverging" price trends since, for both dumped and domestic lik e
products, average prices effectively stagnated in 2012 and decreased in 2013. 795 Korea therefore
considers that Japan has failed to develop any legal argument about why the Panel's conclusions
and reasoning were in error.796
5.296. We note that, in the context of the present causation claim (claim 4), the Panel stated that
"Japan argues that the lack of parallelism between dumped import prices and domestic like product
prices does not support the existence of a causal relationship between the dumped imports and the
injury allegedly suffered by the domestic industry." 797 In particular, the Panel noted that Japan
argued that: (i) dumped import prices increased from 2011 to 2012 while domestic like product
prices decreased; and (ii) dumped import prices fell sharply from 2012 to 2013 whereas domestic
like product prices decreased only slightly. 798 The Panel considered that Japan's arguments in
support of this aspect of the causation claim at issue are identical to its price -effects-related

788 Panel Report, para. 7.352.
789 Panel Report, paras. 7.251 and 7.258. See also section 5.3.4.1.2.1 above.
790 Panel Report, para. 7.353.
791 Japan's appellant's submission, para. 303.
792 Japan's appellant's submission, para. 303.
793 Korea's appellee's submission, para. 299 (referring to Korea's first written submission to the Panel,
paras. 77-92 and 97-112).
794 Korea's appellee's submission, para. 299.
795 Korea's appellee's submission, para. 299.
796 Korea's appellee's submission, para. 455.
797 Panel Report, para. 7.355.
798 Panel Report, para. 7.355.

arguments under claim 6. 799 The Panel recalled that, in the context of claim 6, it had found that
Japan failed to demonstrate that the Korean investigating authorities acted inconsistently with
Article 3.5 with respect to their consideration of the absence of parallel price trends . Based on the
same considerations, the Panel concluded that, in the causation claim at issue (claim 4), Japan had
failed to establish that insufficient price correlation suffice d to demonstrate that a reasonable and
unbiased investigating authority could not have pro perly found the required causal relationship
between the dumped imports and injury to the domestic industry in light of the facts and arguments
that were before the KTC.800
5.297. We recall that we have considered above that the Panel's analysis of the diverging trends in
the context of Japan's claim 6 focused on whether there was a competitive relationship between
dumped imports and domestic like products despite diverging price trends, and whether the
diverging price trends could, in and of themselves, undermine t he causal relationship under
Article 3.5. Accordingly, we have found that the Panel's analysis reviewed the Korean investigating
authorities' examination of the relationship between the prices of the dumped imports and those of
the domestic like product, in order to ascertain the effects of the former on the latter, which, as
explained, corresponds to an examination properly conducted pursuant to Article 3.2, second
sentence. We have also considered that the Panel's conclusion that the diverging price trends do
not, in and of themselves, demonstrate that the KTC's determination of a causal relationship is
inconsistent with Articles 3.1 and 3.5 was a mere consequence of its anal ysis as to whether the
KTC's price-effects analyses were objective and reasoned, and compatible with the requirements set
out in Article 3.2, second sentence. Accordingly, we have found above that the Panel's analysis of
the issue of diverging price trends was based on the applicable requirements under Article 3.2, rather
than those concerning causation under Article 3.5, even though it was addressing a claim under the
latter provision . Given that the Panel relied on the same considerations in rejecting Jap an's
arguments concerning the lack of correlation in price trends in the context of the causation claim at
issue (claim 4), we find the Panel's finding in this regard to be in error.
5.298. Finally, concerning profit trends, Japan contends that "there was also insufficient correlation
in the trends regarding the domestic industry's condition to 'demonstrate' a causal relationship." 801
Japan points out that the domestic industry's operating losses in 2012 and 2013 show that
"regardless of whether subject imports had increasing or decreasing volumes, or whether subject
imports had increasing or decreasing average prices, the domestic industry still lost money." 802
According to Japan, "these operating losses regardless of the presence of subject imports did not
suggest the necessary causal relationship." 803 Japan argues that the Panel embraced, without any
discussion, a logically inconsistent KTC explanation of profit trends. 804 Japan avers that the Panel
pointed to the KTC's statements that domestic -industry profits fell in 2012 due to increased
competition with imports, but "in 2012 the volume of imports was down, the market share of imports
was down, and the average prices of imports were up."805 Therefore, Japan fails to see any basis for
"the assertion about 'increased comp etition' with imports in 2012, given these other facts that the
KTC – and then the Panel – conveniently ignored".806
5.299. Korea, for its part, submits that "it is unclear what the legal error of the Panel would have
been."807 Korea submits that "Japan neglects to m ention [the] KTC's well-grounded evaluation of
the domestic industry's operating loss."808 Korea points out that the KTC specifically acknowledged
that the domestic industry's operating loss persisted from 2010 to 2012, but nonetheless found that
"[t]he deterioration of the operating profit in 2012, after improving in 2011, was a result of the price
reduction of the like product and the increase in the operating cost in response to the competition
with the dumped products."809 Korea contends that the KTC adequately evaluated the operating loss

799 Panel Report, para. 7.356.
800 Panel Report, para. 7.356.
801 Japan's appellant's submission, para. 305.
802 Japan's appellant's submission, para. 305.
803 Japan's appellant's submission, para. 305.
804 Japan's appellant's submission, para. 307.
805 Japan's appellant's submission, para. 307. (fns omitted)
806 Japan's appellant's submission, para. 307.
807 Korea's appellee's submission, para. 457.
808 Korea's appellee's submission, para. 459.
809 Korea's appellee's submission, para. 459 (quoting KTC's Final Resolution (Panel Exhibit KOR-1b
(BCI)), p. 23).

of the domestic industry within the context of its overall injury determination rather than in isolation,
and concluded that the aggravation of the operating loss was attributable to the effect of the dumped
imports.810
5.300. Japan's argument, in our view, appears to mischaracterize the KTC's findings. The KTC did
not state that it found "increased" competition in 2012 . Rather, as the Panel noted, the KTC
acknowledged that the domestic industry's operating loss worsened from 2011 t o 2012, at a time
when dumped import prices increased and their volume and market share declined.811 However, the
Panel noted that the KTC explained that one of the reasons for the increased operating loss ratio
was due to the increase of operating costs "in response to the competition with the dumped
imports".812 The Panel took into account these statements by the KTC in considering Japan's
arguments, noting in particular that, according to the KTC, the worsening operating loss "was a
result not only of the de crease in domestic like product prices (which it elsewhere in its report
attributed to the effect of dumped imports), but also of the increase of operating costs".813
5.301. Therefore, contrary to Japan's argument, neither the Panel nor the KTC ignored the alleged
lack of correlation between the domestic-industry profit, dumped import prices, and the volume and
market share of the dumped imports. The Panel was mindful of the fact that the domestic industry's
operating loss worsened from 2011 to 2012 when the averag e price of the dumped imports
increased, and their volume and market share decreased. However, at the same time, the Panel
found it reasonable for the Korean investigation authorities to consider that "[t]he average price of
the dumped products increased i n 2011 and 2012 not because their actual sales prices rose but
mainly because the product composition was changed [such] that they were mainly composed of
high-priced products."814 As we see it, therefore, the Panel did not err in stating that "the KTC 's
consideration of the relationship between the operating losses of the domestic industry during the
entire POI and the dumped imports is reasonable and grounded in the underlying facts." 815
Accordingly, we reject Japan's argument that " [t]he KTC ['s] discussion o f this … issue … was
deficient", or that "the Panel should have recognized this deficiency." 816 To that extent, we do not
see any error in the Panel's finding.
5.3.4.2.2 Conclusion with respect to claim 4
5.302. In light of the foregoing considerations, we uphold the Panel's finding, in paragraph 8.3.b of
the Panel Report, that Japan has not demonstrated that the Korean investigating authorities acted
inconsistently with Articles 3.1 and 3.5 of the Anti -Dumping Agreement with respect to their
conclusion that the dumped i mports, through the effects of dumping, were causing injury to the
domestic industry, insofar as Japan's argument regarding insufficient correlation between dumped
imports and trends in domestic-industry profits is concerned.
5.3.5 Whether the Appellate Body can complete the legal analysis under Articles 3.1, 3.2,
and 3.4 of the Anti-Dumping Agreement
5.303. We now turn to examine Japan's request that the Appellate Body complete the legal analysis
with respect to Japan's claims under Articles 3.1, 3.2, and 3.4 of the Anti-Dumping Agreement and
find that the Korean investigating authorities acted inconsistently with these provisions in the
anti-dumping investigation at issue.
5.304. To recall, the Panel found that Japan's volume and price -related claims under Articles 3.1
and 3.2 were outside its terms of reference. 817 With respect to Japan's claim under Articles 3.1
and 3.4 regarding the impact of the dumped imports on the state of the domestic industry, the Panel
found that Japan's claim is limited to the allegation that the KTC failed to evaluate two of the specific
factors listed in Article 3.4, namely the ability to raise capital or investments and the magnitude of

810 Korea's appellee's submission, para. 460.
811 Panel Report, para. 7.358.
812 Panel Report, para. 7.358.
813 Panel Report, para. 7.358.
814 Panel Report, para. 7.279 (quoting OTI's Final Report (Panel Exhibit KOR-2b (BCI)), p. 58).
815 Panel Report, para. 7.360.
816 Japan's appellant's submission, para. 308.
817 Panel Report, paras. 7.94 and 7.131.

the margin of dumping, and that all other "allegations" of inconsistency with Article 3.4 were outside
its terms of reference. 818 With regard to those claims and "allegations" excluded from its terms of
reference, the Panel stated that it would neither consider them further nor resolve them.819
5.305. We recall that, in light of the limitation imposed by Article 17.6 of the DSU, the
Appellate Body has completed the legal analysis with "a view to facilitating the prompt settlement
and effective resolution of the dispute … when sufficient factual findings by the panel and undisputed
facts on the panel record allowed it to do so".820 However, in addition to the lack of factual findings
by the panel and undisputed facts on the panel record, the Appellate Body has declined to complete
the legal analysis in view of due process considerations 821, for example, where the panel had not
examined a claim at all822, or where there had not been a full exploration of the issues823 or scrutiny
of the relevant evidence by the panel.824
5.306. With these considerations in mind, we turn to address Japan's request for completing the
legal analysis, starting with whether the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.2 of the Anti-Dumping Agreement regarding their consideration of the volume of
dumped imports.
5.3.5.1 Whether the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.2 of the Anti -Dumping Agreement in their consideration of the volume
of dumped imports
5.307. As noted, for each of the claims that the Panel found to be outside its terms of reference,
the Panel Report contains a section entitled "Relevant facts" that immediately follows the summaries
of the parties' arguments and precedes the Panel's legal analysis regardi ng its terms of reference
under Article 6.2 of the DSU. The Panel proceeded in this manner with respect to Japan's claim under
Articles 3.1 and 3.2 of the Anti-Dumping Agreement regarding the Korean investigating authorities'
consideration of import volume s.825 The Panel sourced the "Relevant facts" from the KTC's Final
Resolution826 and the OTI's Final Report827, which form part of the Panel record. In addition to setting
out the relevant passages from the KTC's Final Resolution and the OTI's Final Report, the P anel
stated:
In the underlying investigation, the KTC considered whether there was a significant
increase in dumped imports in absolute terms, relative to domestic consumption, and
relative to domestic production. The KTC found that, from each of these thr ee
perspectives, the volume of dumped imports decreased from 2010 to 2012, and then
increased sharply from 2012 to 2013. With respect to the trends in market share, the
KTC found that the decreasing trend from 2010 to 2012, reversed into a sharp increase
in 2013; on an end -point to end-point basis from 2010 to 2013, however, the market
share of the dumped imports decreased. In its ultimate determination, the KTC relied
upon the significant increase in dumped imports from 2012 to 2013 as a factor in
suppressing and depressing domestic prices, which in turn [led] to a deterioration of
the state of the domestic industry.828

818 Panel Report, para. 7.175.
819 Panel Report, paras. 7.94, 7.131, and 7.175.
820 Appellate Body Report, Colombia – Textiles, para. 5.30. (fns omitted)
821 See e.g. Appellate Body Reports, Russia – Commercial Vehicles, para. 5.141 (referring to
Appellate Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program, para. 5.224;
EC ‒ Seal Products, paras. 5.63 and 5.69; US – Anti-Dumping Methodologies (China), para. 5.178);
822 See e.g. Appellate Body Report, Russia – Pigs (EU), para. 5.141 (referring to Appellate Body Reports,
EC – Poultry, para. 107; EC – Asbestos, paras. 79 and 82; US – Section 211 Appropriations Act, para. 343;
EC – Export Subsidies on Sugar, para. 337).
823 See e.g. Appellate Body Reports, EC – Asbestos, para. 81; EC and certain member States – Large
Civil Aircraft (Article 21.5 – US), para. 5.721; EC ‒ Seal Products, para. 5.69; Russia – Commercial Vehicles,
para. 5.141.
824 See e.g. Appellate Body Report, US – Countervailing Measures (China), para. 4.157.
825 Panel Report, paras. 7.81-7.84.
826 KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)).
827 OTI's Final Report (Panel Exhibit KOR-2b (BCI)).
828 Panel Report, para. 7.81.

5.308. Japan submits that this part of the Panel Report "sets forth all of the key facts needed to
resolve this claim".829 Japan asserts that the KTC "improperly" found a "significant increase" in the
dumped imports even though the volume of such imports actually fell in two of the three years
during the POI, and increased slightly on an absolute basis and decrease d on a relative basis over
the POI.830 Japan also submits that "[t]his claim is also closely related to the claims the Panel did
address."831 In particular, Japan refers to "the Panel's discussion of the volume -related aspects of
the causation claim".832
5.309. In response, Korea submits that the Panel did not undertake any analysis and did not make
any factual findings under Articles 3.1 and 3.2. According to Korea, "[i]n paragraphs 7.81 to 7.84
[of its Report], the Panel merely summarized some but clearly not all of the 'relevant facts'."833 Thus,
Korea avers that "[g]iven the absence of any legal or factual findings, let alone sufficient factual
findings, there is no basis for the Appellate Body to 'complete' the analysis since no analysis was
ever initiated."834
5.310. Article 3.2 of the Anti-Dumping Agreement instructs an investigating authority "to 'consider'
a series of specific inquiries". 835 With regard to the volume of subject imports, an investigating
authority must consider whether there has been a significant increase in dumped imports in absolute
terms or relative to domestic production or consumption. The Appellate Body has noted that
Article 3.2 does not set out "a specific methodology that investigating authorities are required to
follow when calculating the volume of ' dumped imports' ."836 However, "whatever methodology
investigating authorities choose for determining the volume of dumped imports", it must ensure that
the determination of injury is based on "positive evidence" and an "objective examination" of the
volume of dumped imports.837
5.311. We recall that the Panel addressed the following arguments by Japan regarding the Korean
investigating authorities' consideration of import volumes in the context of Japan's claim 6 under
Articles 3.1 and 3.5 of the Anti -Dumping Agreement. The Panel reviewed Japan's arguments that
the KTC's causation determination was undermined because: (i) the volume of dumped imports
decreased in two years of the three-year period of trend analysis; and (ii) the volume of dumped
imports increased only modestly in absolute terms and decreased in terms of market share in 2013
compared with 2010.838 The Panel found that the KTC did not ignore the decline in dumped imports
from 2010 to 2012. The Panel did not consider it unreasonable for the KT C to have relied on the
78.9% increase in the dumped imports from 2012 to 2013, the most recent period, which was the
same year in which dumping was found.839 The Panel also found that the fact that the market share
of dumped imports did not increase on an end-point to end-point basis from 2010 to 2013 does not,
in and of itself, preclude the conclusion reached by the KTC "that the increase in the absolute volume
of imports, and in particular the significant increase from 2012 to 2013, combined with the price
effects of the dumped imports, caused injury to the domestic industry".840
5.312. We note that certain arguments made by Japan in support of its present claim under
Articles 3.1 and 3.2 are identical to those addressed by the Panel as described in the preceding
paragraph. Japan argues that the KTC acted inconsistently with Articles 3.1 and 3.2 by "improperly"
finding a "significant increase" in subject imports, even though the volume of such imports "actually
fell in two out of three of the comparison periods, and ended the overall period up only slightly on
an absolute basis and actually down on a relative basis".841 Thus, like its argument in the context of

829 Japan's appellant's submission, para. 128.
830 Japan's appellant's submission, para. 137 (referring to Japan's first written submission to the Panel,
paras. 128-131).
831 Japan's appellant's submission, para. 129.
832 Japan's appellant's submission, para. 130 (referring to Panel Report, paras. 7.250-7.258).
833 Korea's appellee's submission, para. 188.
834 Korea's appellee's submission, para. 188.
835 Appellate Body Report, China – GOES, para. 129.
836 Appellate Body Report, EC – Bed Linen (Article 21.5 – India), para. 113. (emphasis original)
837 Appellate Body Report, EC – Bed Linen (Article 21.5 – India), para. 113.
838 Panel Report, para. 7.251.
839 Panel Report, para. 7.254.
840 Panel Report, para. 7.257.
841 Japan's appellant's submission, para. 137 (referring to Japan's first written submission to the Panel,
paras. 128-131).

claim 6, Japan focuses on the alleged failure by the KTC to take into account the decrease of import
volumes in absolute terms in the first two years of the POI, and the decrease of import volumes in
relative terms, in finding that there was a "significant increase" in the volume of imports. However,
in our view, the Panel did not accept the KTC's findings on its face. Rather, the Panel critically
examined the KTC's findings concerning the volume of dumped imports. We do not consider that,
for the Panel, the year in which dumping is found would suffice, without more, for the purposes of
assessing injury. Nor do we understand the Panel to have a priori excluded from its consideration
relevant evidence and information pertaining to the period prior to 2012. To the contrary, the Panel
examined and found that "the KTC did not ignore the decline in dumped imports from 2010 to 2012"
but "explained that, despite the decrease in imports in the first two years, there was a significant
reversal in the trend from 2012 to 2013".842 For the reasons set out in section 5.3.4.1.2.1, we have
explained that the Panel's above analysis a nd findings properly reviewed the Korean investigating
authorities' analysis pursuant to the requirements set out in Article 3.2, first sentence, as opposed
to those under Article 3.5. In so doing, we do not find the Panel to have erred in applying the
requirements contained in Article 3.2, first sentence, when reviewing the KTC's assessment of the
volume of dumped imports. Indeed, in reviewing Japan's argument that the market share of dumped
imports decreased on an end-point to end-point basis, the Panel correctly relied on the requirements
set out in Article 3.2, first sentence.
5.313. However, we note that Japan's arguments in the context of its present claim under
Articles 3.1 and 3.2 concerning the volume of dumped imports and regarding which it requests us
to complete the legal analysis, encompass broader considerations than those contained in the above
findings by the Panel, namely that: (i) the KTC improperly assumed a competitive r elationship
between domestic like products and subject imports; and (ii) the KTC improperly found a "significant
increase" in subject imports without examining whether the increased imports actually replaced
domestic like products through market competition.843
5.314. Turning to the first of these arguments, we note that Japan asserts that the KTC acted
inconsistently with Articles 3.1 and 3.2 in failing to make "an objective examination of whether
subject imports replaced domestic like products, so as to support a determination that the increase
in import volume could objectively be described as 'significant' ."844 Japan also submits that the
"findings" the OTI made on the issue of displacement were "vague and anecdotal"845 and that these
findings merely compared the price levels of the subject imports and domestic like products, without
taking into consideration "the margins of dumping at issue viewed in light of the competitive
relationship (or lack thereof) between subject imports and domestic products".846
5.315. In response, Korea submits that " Article 3.2 requires a quantitative examination of the
volume of dumped imports as part of a more comprehensive injury analysis."847 According to Korea,
Japan's interpretation of what is required of investigating authorit ies under Article 3.2 with respect
to considering the volume of dumped imports goes "far beyond the text of the provision as
interpreted and applied in the jurisprudence".848 Korea further argues that, in any event, the KTC in
fact examined both "the increase in volume and the loss of market share of the domestic like product
and thus established that in this particular case there was such displacement".849
5.316. We note that this argument was not raised by Japan before the Panel in the context of
claim 6. Nor do we find anything in the "Relevant facts" section of the Panel Report that indicates
that the Panel explored with the parties this issue of "replacement" raised by Japan. In this section,
the Panel set out excerpts from the KTC's Final Resolution. 850 Our review of these excerpts shows
that the KTC examined the market share of both sets of products as part of the examination into
the increase of imported products in relative terms. However, these passages, in and of themselves,

842 Panel Report, para. 7.254.
843 Japan's appellant's submission, para. 137 (referring to Japan's first written submission to the Panel,
paras. 132-133 and 137-141; second written submission to the Panel, paras. 98-112).
844 Japan's appellant's submission, para. 141. (emphasis original)
845 Japan's appellant's submission, para. 142.
846 Japan's appellant's submission, para. 142 (referring to Japan's second written submission to the
Panel, paras. 99-105).
847 Korea's appellee's submission, para. 208.
848 Korea's appellee's submission, para. 208.
849 Korea's appellee's submission, para. 210.
850 Panel Report, para. 7.82 (quoting KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 14).

do not show whether the KTC found "replacement" of domestic like products by dumped imports in
the manner asserted by Japan. Importantly, we note that Japan concedes that the Panel "did not
address at all" Japan's point about the Korean investigating authorities' failure to show "any
replacement of domestic shipments by imports".851 Moreover, the Panel did not sufficiently explore
the issue whether Article 3.2, first sentence, requires a showing that subject imports have replaced
domestic like products. We also note that, while Japan characterizes the OTI's findings on "the issue
of displacement [as] vague and anecdotal" 852, Korea contends that the KTC "in fact considered
whether dumped imports displaced domestic sales by examining both volumes and market share
developments".853 Japan, however, subm its that, in so doing, "[t]he Korean [investigating]
authorities … presented only a numerical comparison of the volume, without examining market
interactions by considering the competitive relationship between the dumped imports and domestic
like products in conjunction with the margins of dumping." 854 As we see it, the parties, therefore,
are in clear disagreement about the underlying facts themselves, i.e. the extent to which the Korean
investigating authorities addressed the issue of replacement in their analysis of the volume of
dumped imports. We note that the Panel made no findings in this regard.
5.317. Finally, Japan contends that "[t]he KTC also failed to consider the existence of a competitive
relationship between the dumped imports and the domestic like product, in conjunction with the
margins of dumping."855 Japan submits that, in addition to "[t]he diverging volume and market share
trends", "[t]he consistent and significant overselling, the divergin g price trends, and the differing
magnitudes of price changes were all consistent with the lack of meaningful competitive
relationship."856
5.318. Korea, for its part, submits that Japan does not develop this assertion. 857 Korea avers that
the Appellate Body should not engage in an alleged completion of the legal analysis when "the
appellant does not develop its claims in any way, fails to link the claim to the allegedly undisputed
facts on the record", and "simply makes bare assertions without a proper legal analysis of why a
detailed analysis of the competitive relationship between different producers would be required for
an analysis of the increase in the volume of imports".858
5.319. We note that Japan concedes that the Panel "did not address at all" the point about the
Korean investigating authorities' failure to show "any evidence of a competitive relationship" in the
context of their consideration of the volume of dumped imports. 859 Thus, the Panel did not explore
with the parties the question whether the Korean investigating authorities were required, in the first
place, to consider the competitive relationship between dumped imports and domestic like product
"in conjunction with the margins of dumping" in its analysis of significant increase in volume of
dumped imports under Article 3.2. Furthermore, the "Relevant facts" section does not contain any
indication as to whether the Korean investigating authorities analysed the issue raised by Japan in
the context of their consideration of the volume of dumped imports.860 Nor is such an analysis clearly

851 Japan's appellant's submission, para. 147.
852 Japan's appellant's submission, para. 142.
853 Korea's appellee's submission, para. 189 (referring to Korea's response to Panel question No. 37).
854 Japan's appellant's submission, para. 143.
855 Japan's appellant's submission, para. 139 (referring to Japan's first written submission to the Panel,
paras. 132-133; second written submission to the Panel, paras. 106-108).
856 Japan's appellant's submission, para. 139 (referring to Japan's first written submission to the Panel,
paras. 74-83).
857 Korea's appellee's submission, para. 204.
858 Korea's appellee's submission, para. 204.
859 Japan's appellant's submission, para. 147.
860 We recall that in the context of its price-effects analysis, the KTC considered the competition
between dumped imports and domestic like products, which was examined by the Panel in the context of
Japan's argument concerning diverging price trends under claim 6, and which we have reviewed above in
section 5.3.4.1.2.2.

discernible from our review of the KTC's Final Resolution 861 and the OTI's Final Report862 that form
part of the Panel record.863
5.320. Confronted with these circumstances, completion of the legal analysis regarding whether the
KTC (i) improperly assumed a competitive relationship between domestic like products and subject
imports; and (ii) improperly found a "significant increase" in subject imports without examining the
question of replacement is hindered by the absence of relevant fac tual findings on these issues,
sufficient undisputed facts on the Panel record and a sufficient exploration of these issues by the
Panel. Thus, engaging in the completion exercise would require us to "review and consider evidence
and arguments that … were not sufficiently addressed by the Panel or sufficiently explored and
developed before the Panel".864 In light of the foregoing considerations, we find ourselves unable to
complete the legal analysis as to whether the Korean measures are inconsistent with Articles 3.1
and 3.2 of the Anti -Dumping Agreement with respect to the Korean investigating authorities'
consideration of the volume of the dumped imports.865
5.3.5.2 Whether the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.2 of the Anti-Dumping Agreement in their consideration of price effects
5.321. Japan asserts that the Korean investigating authorities failed to meet their obligations under
Articles 3.1 and 3.2 of the Anti -Dumping Agreement because: (i) the KTC failed to consider the
implications of the overselling by the dumped imports; (ii) the KTC "largely ignored" the diverging
price trends; (iii) the KTC "ignored the absence of any evidence of price suppression in 2011
and 2012, and drew improper conclusions from the limited evidence in 2013"; and (iv) the KTC failed
to ensure the price comparability by failing to demonstrate "any actual and specific competition "
between the dumped imports and domestic like products.866 Japan contends that the Panel's findings
under Article 3.5 of the Anti-Dumping Agreement that the Korean investigating authorities failed to
ensure price comparability and adequately take into account the overselling by the dumped imports
in their examination of causation "demonstrate that the [Korean investigating authoriti es']
determination did not properly assess the 'effect of the dumped imports on prices in the domestic
market' as required by Articles 3.1 and 3.2".867
5.322. In response, Korea argues that the Appellate Body is not in a position to complete the legal
analysis in the absence of any legal or factual findings and undisputed facts on the record regarding
Japan's claim under Articles 3.1 and 3.2.868 Regarding the merits of Japan's claim, Korea maintains
that the Korean investigating authorities considered the implications of the price overselling by the
dumped imports869 and diverging price trends.870 Korea disputes Japan's contention that the Korean
investigating authorities' consideration of price suppression was based on limited evidence from
2013871 and that they did not demonstrate a competitive relationship between the dumped imports
and domestic like products. 872 Korea also contends that "the Korean [investigating] authorities
properly ensured price comparability betwe en like product and the dumped imports." 873 Regarding
Japan's reliance on the Panel's findings concerning Japan's "independent" causation claim, Korea
argues that the completion of the legal analysis in this regard is prevented by the fact that the Panel

861 KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), pp. 14-17.
862 OTI's Final Report (Panel Exhibit KOR-2b (BCI)), pp. 46-51.
863 We recall that in the context of Japan's argument regarding diverging price trends with respect to its
"independent" causation claim under Articles 3.1 and 3.5 of the Anti-Dumping Agreement, we have agreed
with the Panel's analysis that focused on whether there was a competitive relationship between dumped
imports and domestic like products. See section 5.3.4.1.2.2 above.
864 Appellate Body Report, EC and certain member States – Large Civil Aircraft (Article 21.5 – US),
para. 5.749.
865 Japan's appellant's submission, para. 152.
866 Japan's appellant's submission, para. 186.
867 Japan's appellant's submission, para. 202.
868 Korea's appellee's submission, para. 256. In Korea's view, Japan's request for completing the legal
analysis would effectively require the Appellate Body "to play the role of the Panel both in terms of the facts
and in terms of the application of the law to the facts". (Ibid., para. 257)
869 Korea's appellee's submission, paras. 291-297.
870 Korea's appellee's submission, paras. 298-307.
871 Korea's appellee's submission, paras. 308-310.
872 Korea's appellee's submission, paras. 311-319.
873 Korea's appellee's submission, para. 314.

made certain factual findings in its disposition of the price -effects-related claims under Article 3.5,
which the parties dispute and are subject to appeal.874
5.323. The second sentence of Article 3.2 of the Anti-Dumping Agreement requires an investigating
authority to consider whether the effect of such dumped imports on the prices of the domestic like
products is to depress or suppress such prices or to undercut them to a significant degree.
Article 3.2, second sentence, does not prescribe specific methodologies as to how an investigating
authority is to consider whether there has been a significant price undercutting, price suppression,
or price depression. Nor does Article 3.2, second sentence, explicitly state whether an investigating
authority must ensure comparability between the prices that are being compared. As noted above,
"a failure to ensure price comparability" cannot be considered to be consistent with the requirement
under Article 3.1 that "a determination of injury be based on 'positive evidence' and involve an
'objective examination' of, inter alia, the effect of subject imports on the prices of domestic like
products".875 Accordingly, to the extent an investigating authority relies on price comparisons in its
consideration of price effects of subject imports, price comparability needs to be ensured. Thus,
where an investigating authority fails to ensure price comparability in price comparisons between
dumped imports and the domestic like p roduct, this undermines its findings of price effects under
Article 3.2, to the extent that it relies on such price comparisons.876
5.324. With respect to the issue of price comparability, it is undisputed that in the present case "the
KTC undertook price comparis ons" in finding that the dumped imports had price-suppressing
and -depressing effects.877 We recall that, in the context of Japan's claim 6, the Panel found that
"the KTC relied upon the price differentials in [ the] comparisons [at issue] in finding that dum ped
imports had price suppressing and depressing effects on domestic prices , which in turn was one of
the bases for its ultimate determination under Article 3.5."878 The Panel set out in a table what Korea
referred to as a series of comparisons between the individual resale transaction prices of models of
dumped imported valves and the average prices of corresponding models of the domestic like
product reported in the OTI's Final Report. This table underlined those transactions in which dumped
import prices to certain customers were lower than the average domestic price for the corresponding
model produced by the Korean producers.879 The Panel found that the listed transactions "took place
on different dates and involved different quantities". 880 The Panel observe d that, in general, the
lower the quantity involved in a transaction, the higher the unit price of the dumped imported valve.
The Panel took the view that, in light of the possible effect on the comparisons made, an unbiased
and reasonable investigating au thority could not have properly compared these individual
transaction prices with the average price of the corresponding model of the domestic like product
without further consideration and explanation of the "relevance or significance " of these
differences.881
5.325. As indicated above, while the Panel's analysis was carried out in the context of Japan's
claim 6, it was nonetheless in line with the requirements set out in Article 3.2, second sentence.882
Indeed, the Panel's analysis of the issue of price comparability was properly conducted under
Article 3.1 and Article 3.2, second sentence, and the Panel's finding that the Korean investigating
authorities had to ensure price comparability in the price comparisons they undertook was
compatible with the requirements of these provisions. As the Panel's finding indicate s, the Korean
investigating authorities' transaction-to-average comparison analysis was aimed at assessing
whether the prices of dumped imports were lower than the prices of domestic li ke products. T he
Korean investigating authorities considered that individual cases of dumped import resale prices for
some models that were lower than average domestic prices and high -end domestic prices for
corresponding models to certain customers (i.e. individual instances of "underselling") led to price

874 Korea's appellee's submission, para. 319.
875 Appellate Body Report, China – GOES, para. 200.
876 See section 5.3.4.1.4 above.
877 Panel Report, para. 7.267.
879 Panel Report, para. 7.270 and Table 1 (referring to OTI's Final Report (Panel Exhibit KOR-2b (BCI)),
pp. 100-101).
880 Panel Report, para. 7.271.
881 Panel Report, para. 7.271.
882 See section 5.3.4.1.4.2 above.

suppression and price depression of the domestic like product. 883 Price comparability thus became
an important issue in the KTC's consideration of price effects since "the KTC relied upon the price
differentials in these comparisons in finding that dumped imports had price suppressing and
depressing effects on domestic prices."884
5.326. The Panel found that the transactions "took place on different dates and involved different
quantities" and rightly, in our view, considered that an unbiased and reasonable investigating
authority could not have properly compared these individual transaction prices with the average
price of the corresponding model of the domestic like product without further consideration and
explanation of the "relevance or significance" of these differences.885 The Panel ultimately found that
the evidence before it did not suggest that either the KTC or the OTI made any effort to consider
differences or their potential consequences for price suppression and price depression in the
determination of material injury caused by dumped imports, thereby casting doubt on the validity
of these price comparisons.886 In our view, these flaws that the Panel identified concern the
objectivity and evidentiary foundation of the KTC's price suppression and price depression findings
under Articles 3.1 and 3.2.887
5.327. For these reasons, we are able to complete the legal analysis to find that, as the Korean
investigating authorities found price-suppressing and -depressing effects of dumped imports based
on the transaction-to-average price comparisons without ensuring price comparability, they acted
inconsistently with Articles 3.1 and 3.2 of the Anti-Dumping Agreement.
5.328. Next, with respect to the issue of price overselling, Japan argues that "[i]n finding the price
effects of the dumped imports on the domestic like products, the KTC ignored … the significant
overselling of the dumped imports."888
5.329. Korea responds that the KTC expressly addressed the fact that the av erage sales price of
the dumped imports was higher than that of the like product but found that "this 'overselling' did
not undermine the conclusion that the suppression and depression of domestic prices was a result
of the dumped imports."889
5.330. We recall that the Korean investigating authorities relied on individual instances of
"underselling" to address the argument by the interested parties that the consistent overselling by
dumped imports based on the average price precluded a finding of price suppression and price
depression. In particular, "the KTC referred to the [ price-suppressing and -depressing] effects of
individual instances of … 'underselling' on 'the price of the like product'."890 As noted by the Panel in
the section entitled "Relevant facts", the KTC stated:
The Commission finds that the dumped products suppressed price increases of the like
product and caused decreases thereof, although the average sales price of the dumped
products was higher than that of the like product.
The avera ge sales price of the dumped products was higher due to their price
differentiation in accordance with models, option details or customers, but it was found
that the sales price of the dumped products was much lower than the average sales
price in the case of certain products or customers for which the degree of competition
with the domestic industry was fierce, which had the effect of suppressing increases in
the price of the like product or causing decreases thereof. It was investigated that SMC
Korea … consistently expanded its sales organizations and used its dominant position to
attract distribution agents or discourage defections of its distribution agents, and thus

883 Panel Report, para. 7.302 (referring to OTI's Final Report (Panel Exhibit KOR-2b (BCI)), pp. 100-101;
Korea's response to Panel's question No. 88(b), para. 19; Record Data on the Dumped Imports' Individual
Resale Transaction (Panel Exhibit KOR-57 (BCI))).
885 Panel Report, para. 7.271.
886 Panel Report, para. 7.271.
887 See section 5.3.4.1.4.2 above.
888 Japan's appellant's submission, para. 187.
889 Korea's appellee's submission, para. 284.
890 Panel Report, para. 7.302.

the domestic industry had to respond to such strengthened marketing activities of SMC
Korea and become forced to decrease the sales price or refrain from increasing prices.891
5.331. The Panel, albeit in the context of Japan's claim 6, considered that "[t]his implie[d] that the
KTC found [that] the [price-suppressing and -depressing] effects of these individual instances were
on domestic like product prices as a whole, and not only on the prices of certain models of the
domestic like product."892 The Panel thus understood the Korean investigating authorities to have
considered that individual cases of d umped import resale prices for some models that were lower
than average domestic prices and high-end domestic prices for corresponding models to certain
customers (i.e. individual instances of "underselling") led to price suppression and price depression
of the domestic like product.893 As we see it, the KTC relied on the evidence regarding the individual
instances of "underselling" in order to respond to the interested parties' arguments concerning the
existence of price overselling based on the average prices of all the products. The KTC reached the
conclusion that these individual instances of "underselling" had the effect of suppressing and
depressing the prices of domestic like product despite the overall overselling by the dumped imports.
In response to Korea's argument that Panel Exhibit KOR -57 supported the KTC's conclusion, the
Panel reviewed the said Exhibit in conjunction with the OTI's Final Report and the KTC's Final
Resolution and found that the evidence did not show whether, and if so how, the Korean investigating
authorities examined the extent to which prices of the domestic like product were affected by the
individual instances of lower dumped import prices.894
5.332. Although the Panel made this finding in the context of Japan's claim 6, for the reasons stated
above, we have considered that the Panel's analysis was nonetheless in line with the requirements
set out in Article 3.1 and Article 3.2, second sentence. Indeed, the Panel's analysis of the issue of
price overselling and the indivi dual instances of "underselling" was properly conducted under , and
complied with, the requirements of th ose provisions. 895 Accordingly, we have explained that,
although the Panel spoke of price suppression or depression of the domestic like product "as a
whole", we do not consider the Panel to have imposed a legal requirement "to demonstrate how and
to what extent underselling in certain competitive sales affected the prices of the domestic like
product 'as a whole'". 896 Rather, in the context of this case, the Panel examined the KTC's
determination and, on that basis, "[understood] the KTC [to have] found [that] the effects of these
individual instances were on domestic like product prices as a whole, and not only on the prices of
certain models of the domestic like product".897 However, the Panel found that an explanation and
analysis of how and to what extent the prices of the domestic like product were affected was
lacking.898 In our view, the above -mentioned flaws that the Panel identified concern the Korean
investigating authorities' failure to conduct an objective examination based on positive evidence in
their consideration of price suppression and price depression. As we have explained, in identifying
the price-suppressing and -depressing effects of the dumped imports, it was therefore incumbent
upon the Korean investigating authorities to have provided an explanation and analysis of how and
to what extent the prices of the domestic like product were affected in light of the consistent
overselling by the dumped imports.899
5.333. Korea argues that the Panel made "certain factual findings on which its legal analysis [of the
price effects in the context of the Korean investigating authorities' causation determination] was
based which both sides contest and dispute".900 We recall that, in section 5.3.4.1.5 above, we have
addressed Korea's appeal that the Panel failed to make an objective assessment of the matter under
Article 11 of the DSU and Article 17.6 of the Anti -Dumping Agreement. In this context, we have
rejected several arguments raised by Korea concerning alleged errors by the Panel in its assessment

891 Panel Report, para. 7.115 (quoting KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 19).
(emphasis added by the Panel)
892 Panel Report, para. 7.302.
893 Panel Report, para. 7.302 (referring to OTI's Final Report (Panel Exhibit KOR-2b (BCI)), pp. 100-101;
Korea's response to Panel's question No. 88(b), para. 19; Record Data on the Dumped Imports' Individual
Resale Transaction (Panel Exhibit KOR-57 (BCI))).
894 Panel Report, paras. 7.309-7.310.
895 See section 5.3.4.1.4.2 above.
896 Korea's other appellant's submission, para. 222.
897 Panel Report, para. 7.302.
898 Panel Report, paras. 7.311-7.313.
899 See section 5.3.4.1.4.2 above.
900 Korea's appellee's submission, para. 319.

of the facts. For instance, we have rejected Korea's argument that the Panel created and applied
"specific and excessively demanding requirements" th at must be met in an overselling situation
insofar as it relates to the applicable requirements set out in Article 3.2 of the Anti -Dumping
Agreement. Similarly, we have rejected Korea's argument regarding the Panel's treatment of Panel
Exhibit KOR-57 and agreed with the Panel's reading of that Exhibit.901 Apart from those arguments,
Korea does not identify any disputed factual findings with respect to the Panel's finding that the
Korean investigating authorities failed to adequately take into account the consistent overselling by
the dumped imports. Rather, as Korea acknowledges, the KTC relied on the relevant price
comparisons and individual instances of "underselling" to conclude that the average price overselling
by the dumped imports "did not undermine [its] conclusion that the dumped imports suppressed
and depressed the domestic price of the like product".902
5.334. For these reasons, we are able to complete the legal analysis and find that, in the absence
of any explanation and analysis of how and to what exten t the prices of the domestic like product
were affected in light of the consistent overselling by dumped imports when finding price suppression
and price depression, the Korean investigating authorities acted inconsistently with Articles 3.1 and
3.2 of the Anti-Dumping Agreement.
5.335. With respect to diverging price trends, Japan contends that the KTC also "largely ignored"
these "dramatically" diverging price trends that strongly suggested the lack of interaction in the
market between the price of the subject imports and that of the domestic like products.903
5.336. Korea, for its part, submits that the KTC considered the development in prices of both the
dumped imports and the domestic like products in a dynamic manner over the entire POI,
year-by-year and end-point to end-point, using average import and resale prices as well as a price
fluctuation index. 904 On the basis of this "comprehensive analysis", Korea contends that "[the]
KTC observed strong indications of price effects by the dumped imports on domestic prices
throughout the entire POI, including in 2012 and 2013."905
5.337. We recall that, before the Panel, Japan raised the same argument in support of claim 6 and
contended that "these diverging price trends show that there was no market interaction between
the dumped imports and the domestic like product", thus "undermining the KTC's price suppression
and depression analyses , which in turn formed the basis of the ultimate determination under
Article 3.5".906 The Panel found that "[t]he different magnitude of the price decreases from 2012 to
2013 does not necessarily undermine the KTC's findings with respect to the competitive relationship
between the dumped imports and the domestic like product." 907 According to the Panel, the KTC's
explanation that "the prices of the domestic industry were already at unsustainabl y low levels"908,
which constrained any further price reductions, was reasonable and supported by the facts. 909 For
the alleged divergence from 2011 to 2012, the Panel acknowledged that it "cou ld suggest a lack of
competition between the dumped imports and the domestic like product". 910 However, the Panel
found that "[t]he KTC did not disregard this possibility in its analysis" as it "explained that the
diverging trend from 2011 to 2012 was caused by a change in the product mix of the dumped
imports."911 The Panel found this explanation to be "reasonable and supported by the facts".912
5.338. As noted above, the Panel's analysis focused on whether there was a competitive relationship
between dumped imports a nd domestic like products despite diverging price trends, and whether
the diverging price trends could, in and of themselves, undermine the causal relationship. 913 This,

901 See section 5.3.4.1.5 above.
902 Korea's appellee's submission, para. 292.
903 Japan's appellant's submission, para. 186.
904 Korea's appellee's submission, para. 299 (referring to Korea's first written submission to the Panel,
paras. 77-92 and 97-112).
905 Korea's appellee's submission, para. 299.
907 Panel Report, para. 7.295.
908 Panel Report, para. 7.278 (referring to KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p.18).
909 Panel Report, para. 7.295.
910 Panel Report, para. 7.295.
911 Panel Report, para. 7.295.
912 Panel Report, para. 7.295.
913 See section 5.3.4.1.2.2 above. See also Panel Report, para. 7.295.

as noted, is evident from the manner in which the Panel drew its conclusions concerning the
diverging trends in the average prices of dumped imports and the domestic like product when it
explained that: (i) the different magnitude of the price decreases from 2012 to 2013 does not
necessarily undermine the KTC's findings with respect to the competitive relationship between the
dumped imports and the domestic like product 914; (ii) the opposing price movements from 2011
to 2012 could suggest a lack of competition between the dumped imports and the domestic like
product and the KTC did not disregard this possibility in its analysis915; and (iii) the verified instances
in which the dumped imports were sold at prices lower than those of the domestic like product
support the view that there was competition in the Korean market for valves.916 We have reviewed
above these findings by the Panel and explained that the Panel properly reviewed the Korean
investigating authorities' examination of the relationship between the prices of the dumped imports
and those of the domestic like products, in order to ascertain the effects of the former on the latter.
In so doing, we have found that this corresponds to an examination properly conducted pursuant to
Article 3.2, second sentence. Therefore, given that we have found above that the Panel properly
reviewed the Korean investigating authorities' consideration of the diverging price trends in light of
the requirements set out in Article 3.2, second sentence, and found it reasonable and supported by
facts, we reject Japan's allegation that the KTC "largely ignored" the div erging price trends which
strongly suggested the lack of interaction in the market between the price s of the subject imports
and those of the domestic like products.917
5.339. For these reasons, we are able to complete the legal analysis and find that the Korean
investigating authorities did not act inconsistently with Articles 3.1 and 3.2 of the Anti -Dumping
Agreement with respect to their consideration of diverging price trends.
5.340. We now turn to Japan's argument that "the KTC failed to address the counterfactual question
of how prices … might have been different in the absence of dumping." 918 Japan asserts that the
KTC did not examine certain "market interactions" between the dumpe d imports and domestic like
products.919 In this way, according to Japan, "the KTC's determination ignored significant facts
suggesting that there is no meaningful competitive relationship between the subject imports and
domestic like products as a whole."920
5.341. Korea disputes Japan's claim that Article 3.2 of the Anti -Dumping Agreement requires an
investigating authority "to consider what would have happened to domestic prices 'in the absence
of dumping'".921 Even if there is such an obligation, Korea argues that t he Korean investigating
authorities adequately addressed the issue "by looking at a reasonable sales price or by examining
price developments in light of market conditions such as increasing demand or costs".922
5.342. Japan's argument is premised on the notion that Article 3.2 of the Anti-Dumping Agreement
requires an investigating authority to consider "the competitive relationship between the dumped
imports and the domestic like product in conjunction with the dumping margins at issue".923 Korea,
however, disagrees with Japan's argument that the "core question" in a price-effects analysis under
Article 3.2 is to consider what would have happened to domestic prices "in the absence of dumping,
i.e. if the dumped imports had been sold at their normal value". 924 Korea considers this argument
legally erroneous, because the text of Article 3.2 refers to the price effects of "dumped imports"
rather than of "dumping". These arguments thus raise a question regarding Article 3.2 that the Panel
never explored with the parties. In deed, Japan concedes that "[t]he Panel … did not address at all
Japan's point[] under Article 3.2 about the failure to … provide an analysis of the counterfactual
question of how prices might have been different in the absence of dumping." 925 In our view,

914 Panel Report, para. 7.295.a.
915 Panel Report, para. 7.295.a.
916 Panel Report, para. 7.295.c.
917 See section 5.3.4.1.2.2 above.
918 Japan's appellant's submission, para. 185 (referring to Japan's second written submission to the
Panel, paras. 17 and 25-32).
919 Japan's appellant's submission, para. 187.
920 Japan's appellant's submission, para. 187.
921 Korea's appellee's submission, para. 267 (quoting Japan's appellant's submission, para. 191).
922 Korea's appellee's submission, para. 267.
923 Japan's appellant's submission, para. 185.
924 Korea's appellee's submission, para. 267 (quoting Japan's appellant submission, para. 191).
925 Japan's appellant's submission, para. 200.

engaging with this issue would therefore require us to "review and consider evidence and arguments
that … were not sufficiently addressed by the Panel or sufficiently explored and developed before
the Panel".926
5.343. Accordingly, we find ourselves unable to complete the legal analysis as to whether the
Korean investigating authorities acted inconsistently with Articles 3.1 and 3.2 in "fail[ing] to address
the counterfactual question of how prices … might have been different in the absence of dumping".927
5.344. Next, Japan contends that "the KTC also ignored the absence of any evidence of price
suppression in 2011 and 2012, and drew improper conclusions from the limited evidence in 2013."928
According to Japan, "contrary to the KTC findings, the OTI data on 'reasonable selling price' actually
undermined any finding of price suppression."929 In addition, Japan dismisses the "reasonable sales
price" analysis claiming that it was "flawed and insufficient". 930 According to Japan, "Korea did not
explain how or why it selected a p articular benchmark to set the 'reasonable selling price', or why
that benchmark should be considered reasonable."931
5.345. Korea, for its part, disputes these arguments. Specifically, Korea argues that the KTC
"adopted the relevant approach to price suppression b y using a 'reasonable sales price' or
constructed target price for comparison with the actual price levels, irrespective of whether the
prices mirror each other in terms of direction and magnitude".932 Moreover, Korea claims that "[the]
OTI verified that the domestic industries could have raised the sales price of the like product to the
level of the reasonable sales prices if there had been no dumping, based on the magnitude of
dumping margins and the range of 'reasonable sales prices'."933
5.346. We note that, beyon d a general reference in the "Relevant facts" section 934, the Panel did
not specifically address the issues relating to the OTI's use of the "reasonable sales price", including
the OTI's choice of the operating profit ratio that was used to construct the "re asonable sales
price".935 The Panel merely noted that "[i]n its Final Report, the OTI appended two explanatory notes
regarding the calculation of the reasonable sales price to the table reporting comparisons between
the actual price and the reasonable sales price."936 It is also evident from the competing positions
adopted by the parties that the underlying factual bases are contested. Thus, given the limited scope
and nature of the Panel's factual findings and the limited undisputed record evidence in this regard,
our attempt to complete the legal analysis involving such competing arguments would require us to
"review and consider evidence and arguments that … were not sufficiently addressed by the Panel
or sufficiently explored and developed before the Panel".937
5.347. Accordingly, we find ourselves unable to complete the legal analysis as to whether the
Korean investigating authorities acted inconsistently with Articles 3.1 and 3.2, owing to the alleged
flaws and insufficiencies in their "reasonable sales price" analysis.938
5.348. Finally, Japan argues that the Korean investigating authorities never considered whether the
alleged price suppression and price depression were "significant".939 However, we fail to detect any
specific argumentation in Japan's submissions before us that substantiates how and why the Korean
investigating authorities failed to address the significance of the price suppression and price

926 Appellate Body Report, EC and certain member States – Large Civil Aircraft (Article 21.5 – US),
para. 5.749.
927 Japan's appellant's submission, para. 185 (referring to Japan's second written submission to the
Panel, paras. 17 and 25-32).
928 Japan's appellant's submission, para. 186.
929 Japan's appellant's submission, para. 186.
930 Japan's appellant's submission, para. 192.
931 Japan's appellant's submission, para. 193.
932 Korea's appellee's submission, paras. 295 and 309.
933 Korea's appellee's submission, para. 422 (quoting OTI's Final Report (Panel Exhibit KOR-2b (BCI)),
p. 85).
934 See e.g. Panel Report, paras. 7.112 and 7.116-7.117.
935 Panel Report, para. 7.116 (quoting OTI's Final Report (Panel Exhibit KOR-2b (BCI)), p. 57).
936 Panel Report, para. 7.116.
937 Appellate Body Report, EC and certain member States – Large Civil Aircraft (Article 21.5 – US),
para. 5.749.
938 Japan's appellant's submission, para. 192. (fn omitted)
939 Japan's appellant's submission, para. 186.

depression they identified. Moreover, we note that Korea disputes Japan's argument and claims that
the KTC considered the quantitative aspect of the price effects of the dumped imports.940 In addition,
Korea argues that the KTC considered that the drop in domestic prices in 2013 to be particularly
significant given that "domestic prices had already been suppressed throughout the entire POI, and
because in 2013 consumption grew significantly and manufacturing costs increased". 941 We note
that the Panel did not explore the issue of "significance" of the identified price effects with the
parties. Indeed, as Japan conce des, "[t]he Panel … did not address at all Japan's point[] under
Article 3.2 about the failure to … show whether imports affected the price of subject products to a
'significant' degree." 942 These considerations suggest that the factual basis underlying Japa n's
argument is disputed and, notably, remained unaddressed by the Panel.
5.349. Accordingly, we find ourselves unable to complete the legal analysis as to whether the
Korean investigating authorities acted inconsistently with Articles 3.1 and 3.2 because the KTC never
considered whether the alleged price suppression and price depression were "significant".
5.350. In light of the foregoing considerations, we find that we are able to complete the legal
analysis in part. For the reasons explained above, we find that the Korean investigating authorities
acted inconsistently with Articles 3.1 and 3.2 of the Anti-Dumping Agreement: (i) to the extent they
found price-suppressing and -depressing effects of dumped imports based on the relevant price
comparisons without ensuring price comparability; and (ii) in the absence of any explanation and
analysis of how and to what extent the prices of the domestic like product were affected in light of
the consistent overselling by dumped imports when finding price suppression and price depression.
We also find that the Korean investigating authorities did not act inconsistently with Articles 3.1
and 3.2 of the Anti-Dumping Agreement with respect to their consideration of diverging price trends.
5.351. However, for the reasons explained above, w e find ourselves unable to complete the legal
analysis as to whether the Korean investigating authorities acted inconsistently with Articles 3.1
and 3.2 on the basis of Japan's arguments that : (i) "the KTC failed to address the counterfactual
question of h ow prices … might have been different in the absence of dumping" 943; (ii) the
"reasonable sales price" analysis "was flawed and insufficient, as the KTC failed to examine market
interactions between the subject imports and domestic like products" 944; and (iii) the KTC never
considered whether the alleged price suppression and price depression were "significant".945
5.3.5.3 Whether the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.4 of the Anti -Dumping Agreement in their consideration of the impact
of dumped imports on the state of the domestic industry
5.352. We turn to Japan's claim under Articles 3.1 and 3.4 of the Anti -Dumping Agreement
regarding the impact of dumped imports on the state of the domestic industry. Japan advances three
arguments in support of its claim that the Korean investigating authorities acted inconsistently with
these provisions, namely that: (i) the KTC did not establish any logical link between its findings
regarding the volume and price effects under Article 3.2 of the Anti-Dumping Agreement and its
finding of impact under Article 3.4946; (ii) the KTC "more generally" failed to show any explanatory
force from dumped imports regarding the trends related to the condition of the domestic industry947;
and (iii) the KTC failed to explain adequately how imports had negatively impacted the domestic like
products as a whole in light of positive trends experienced by the domestic industry.948
5.353. Turning to the first of Japan's arguments, Japan contends that the KTC did not establish any
"logical link" between its findings regarding the volume and price effects under Article 3.2 and its
finding of impact under Article 3.4.949

940 Korea's appellee's submission, para. 305.
941 Korea's appellee's submission, para. 306.
942 Japan's appellant's submission, para. 200.
943 Japan's appellant's submission, para. 185.
944 Japan's appellant's submission, para. 192. (fns omitted)
945 Japan's appellant's submission, para. 186.
946 Japan's appellant's submission, para. 237.
947 Japan's appellant's submission, para. 245.
948 Japan's appellant's submission, para. 250.
949 Japan's appellant's submission, para. 237.

5.354. Korea responds that there is no requirement under Article 3.4 to establish a "logical link"
between the volume of the dumped imports and their price effects, on the one hand, and the injury
factor developments, on the other hand. 950 Korea adds that the focus of Article 3.4 is on the
evaluation of all relevant factors affecting the domestic industry, rather than on establishing a causal
link with price suppression or depression or increased volumes of imports.951
5.355. We recall that, in the context of claim 6, Japan made an identical argument contending that
"the Panel's conclusion that the KTC need not establish a link between volume and price effects
under Article 3.2 and impact on the domestic industry under Article 3.4 is … wrong."952 In addressing
Japan's appeal in section 5.3.4.1.2.3 above, we agreed with the Panel that, in order to examine the
impact of dumped imports on the domestic industry properly for purposes of Article 3.4, an
investigating authority is not required to link that examination with its consideration of the volume
and the price effects of the dumped imports.953 Contrary to Japan's argument, the Appellate Body's
reliance on the term "the effect of" in Article 3.2 does not suggest that this provision "explicitly
foreshadows the next step of considering 'the factors affecting domestic prices in Article 3.4'".954
Rather, we believe, as did the Panel, that the inquiries under Articles 3.2 and 3.4 can be undertaken
independently, and brought together in the ultimate determination of causation under Article 3.5.955
Therefore, we reject, for the same rea sons stated above, the premise of Japan's argument that
Article 3.4 necessarily requires an investigating authority to link its examination of the impact of
subject imports on the domestic industry with its considerations of volume and price effects under
Article 3.2.
5.356. Next, Japan contends that "the KTC['s] Final Resol ution more generally failed to show any
explanatory force from subject imports regarding the trends related to the condition of the domestic
industry."956 Instead, according to Japan, "the KTC discussion of impact was more suggestive of
other factors having explanatory force, not subject imports." 957 In support of this point , Japan
submits:
a. the decline in total domestic consumption in 2012 had far more power to explain the
decline in domestic sales in 2012 than did the decline in subject imports in the same year.
These facts did not produce any reasonable basis for the KTC to infer that the subject
imports replaced the domestic like products, at least, in 2012; rather, these facts
demonstrated that there was no interaction between the subject imports and the domestic
like products in the market;
b. the domestic industry's loss of market share in 2013 was caused by the sharp increase of
consumption in 2013, rather than by dumped imports , which were a less important
explanatory factor;
c. the fact that dumped import pric es were higher than domestic prices undermines the
explanatory force of those imports for the decrease in the prices of the domestic like
product in 2013;
d. competition between the two applicants, as a result of the increase in their respective
capacity, has more explanatory force than the dumped imports for the trends in the prices
of the domestic industry; and
e. the explanatory force of the dumped imports for the decrease in domestic prices is
undermined by the fact that domestic prices decreased by 3.6% in 2012 whereas dumped

950 Korea's appellee's submission, para. 386.
951 Korea's appellee's submission, para. 387.
952 Japan's appellant's submission, para. 293 (referring to Panel Report, paras. 7.330 and 7.347.b).
953 Panel Report, para. 7.330.
954 Japan's appellant's submission para. 292.
955 Panel Report, para. 7.329.
956 Japan's appellant's submission, para. 245. (fn omitted)
957 Japan's appellant's submission, para. 245. (emphasis added)

import prices increased by 7%, and domestic prices decreased by only 1.2% in 2013,
when dumped import prices fell by 31.1%.958
5.357. Korea, for its part, contends that "Japan seems to consider that [the] KTC should have
carried out a fully-fledged non-attribution analysis for its examination under Article 3.4."959 In any
event, Korea submits that " [the] KTC established the requisite 'link', or 'explanatory force', of the
dumped imports on the state of the domestic industry."960
5.358. Article 3.4 of the Ant i-Dumping Agreement is concerned with "the relationship between
subject imports and the state of the domestic industry".961 Thus, Article 3.4 does not merely require
an evaluation of each of the injury factors relevant to the state of the domestic industry b ut
contemplates that an investigating authority assess the impact of dumped imports on the basis of
such an evaluation.962
5.359. Japan suggests that the Korean investigating authorities were required to undertake a
full-fledged causation and non-attribution analysis in their examination under Article 3.4. Several of
Japan's above arguments , namely (a), (b), and (d), allege that factors other than the dumped
imports were responsible for the state of the domestic industry. 963 Indeed, Japan's argument that
"[t]he same facts can both undermine the existence of any explanatory force and then also lead to
an argument [on non -attribution]"964 suggests that, in Japan's vie w, Article 3.4 contemplates an
exhaustive analysis of all known factors that may cause injury to the domestic industry, thereby,
duplicating the overall causation determination required under Article 3.5. We are unable to
subscribe to Japan's understanding of Article 3.4. We have considered above an identical legal
question965 and explained that the demonstration that subject imports are causing injury to the
domestic industry "is an analysis specifically mandated by Article 3.5".966 Indeed, as the
Appellate Body stated, under Article 3.4 "an investigating authority is required to examine the
impact of subject imports on the domestic industry", but "is not required to demonstrate that subject
imports are causing injury to the domestic industry". 967 We are therefore not convinced that the
Korean investigating authorities were required to consi der these " other factors" enumerated by
Japan in their examination under Article 3.4 of the impact of the dumped imports on the state of the
domestic industry.968
5.360. Turning to the third of Japan's arguments, Japan argues that "the KTC … failed to adequately
explain how imports had negatively impacted the domestic like products as a whole in light of positive
trends experienced by the domestic industry." 969 Japan contends that the KTC appears to have
attached "a high degree of importance to the other relevant factors highlighting negative aspects of
the domestic industry, while disregarding or downplaying the many factors suggesting that the
Korean industry was not suffering injury". 970 In particular, Japan asserts that "[t]he domestic
industry saw increasing domestic sales and substantial new investment."971

958 Japan's appellant's submission, para. 245. (fns omitted)
959 Korea's appellee's submission, para. 400.
960 Korea's appellee's submission, para. 399.
961 Appellate Body Report, China – GOES, para. 149.
962 Appellate Body Report, China – GOES, para. 149. In this regard, the Appellate Body has indicated
that the factors and indices that are relevant to an examination under Article 3.4 not only include those
expressly listed therein but additional ones if they are relevant to the assessment of the state of the domestic
industry. (Appellate Body Report, Russia – Commercial Vehicles, para. 5.155)
963 Panel Report, para. 7.338.
964 Japan's appellant's submission, para. 249.
965 See section 5.3.4.1.2.3 above. In the context of claim 6, Japan argued that the Panel "incorrectly"
noted "there is no need 'to undertake a fully reasoned causation and non-attribution analysis' as part of
Article 3.4." (Japan's appellant's submission, para. 290 (quoting Panel Report, para. 7.332))
966 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.205 (referring to
Appellate Body Report, China – GOES, para. 150).
967 Appellate Body Report, China – GOES, para. 150. (emphasis original)
968 As for arguments (c) and (e), we have addressed Japan's similar arguments concerning price
overselling and diverging price trends in sections 5.3.4.1.4 and 5.3.4.1.2.2, respectively.
969 Japan's appellant's submission, para. 250.
970 Japan's appellant's submission, para. 251.
971 Japan's appellant's submission, para. 251.

5.361. In response, Korea submits that "WTO jurisprudence confirms that there is no obligation to
conclude that every factor is negative under Article 3.4."972 Korea asserts that the KTC's injury
determination was grounded on the comprehensive review of "all relevant economic factors" and its
holistic injury examination cannot be undermined just because a few indices were not necessarily
indicative of injury.973
5.362. We recall that Article 3.4 requires an investigating authority to examine the impact of subject
imports on the state of the domestic industry on the basis of "all relevant economic factors and
indices having a bearing on the state of the industry", and provides a list of such factors and indicia
that the au thority must evaluate.974 Article 3.4 makes it clear that neither one nor several of the
factors listed therein can "necessarily give decisive guidance" as to the impact of the dumped imports
on the state of the domestic industry. As noted by the Appellate Body, "there is no exclusive
methodology prescribed for an investigating authority to conduct an examination under
Article 3.4."975
5.363. Japan argues that, notwithstanding the fact that the domestic industry saw increasing
domestic sales and substantial new investment, the KTC did not provide any explanation whatsoever
regarding the weight attributed to any given factor or of the inferences it drew from those factors
that were positive.976 However, we recall that, in the context of Japan's claim under Articles 3.1 and
3.4 of the Anti-Dumping Agreement, the Panel found that Japan's claim concerning the state of the
domestic industry is limited to the allegation that the KTC failed to evaluate two of the specific factors
listed in Article 3.4, one of which was the ability to raise capital or investments.977 The Panel noted
that, "[i]n Japan's view, the fact that investment expanded in those two years contradicts the KTC's
overall evaluation of the domestic industry's ability to raise capital."978 In that connection, the Panel
noted that, having found that investment increased sharp ly from 2011 to 2012, "the KTC went on
to analyse the reasons for the increase in the first place, and the impact of the fiscal crisis -led
contraction in demand on investment." 979 Ultimately, the Panel found that Japan failed to
demonstrate that the KTC's evaluation of the investment and funding ability of the domestic industry
is not one that a reasonable and objective investigating authority could make in light of the evidence
and arguments before it.980 Japan has not challenged on appeal this finding by the Panel. Thus, we
are unable to see the basis on which Japan requests us to complete the legal analysis and find that
the Korean investigating authorities acted inconsistently with Articles 3.1 and 3.4 with respect to its
argument concerning positive trends in investment, which stands addressed by the Panel and
remains unappealed.
5.364. We also recall that , in the context of Japan's claim 6 under Articles 3.1 and 3.5 of the
Anti-Dumping Agreement, the Panel addressed Japan's argument that the KTC failed to take in to
account positive trends during the period of trend analysis with respect to sales such that it
"disproved" the existence of a causal relationship between the dumped imports and the injury to the
domestic industry.981 The Panel observed that the KTC noted and acknowledged the 14% increase
in sales from 2010 to 2013, and the 7.6% increase in sales from 2012 to 2013, in the context of a
52.8% increase in consumption.982 The Panel further observed that the KTC noted that the domestic
industry lost 11.6 percentage points of market share, almost entirely to dumped imports, which
indicated material injury.983 Japan has not appealed these findings made by the Panel. It is therefore
unclear on what basis Japan asserts that, notwithstanding these findings, the KTC's asse ssment of
sales was flawed.

972 Korea's appellee's submission, para. 403. (fn omitted)
973 Korea's appellee's submission, para. 403.
974 Appellate Body Report, China – GOES, para. 147.
975 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.204.
976 Japan's appellant's submission, para. 251 (referring to Japan's first written submission to the Panel,
paras. 180-182).
977 Panel Report, para. 7.175.
978 Panel Report, para. 7.183.
979 Panel Report, para. 7.184.
980 Panel Report, para. 7.186.
981 Panel Report, paras. 7.324 and 7.341-7.346.
982 Panel Report, para. 7.345.
983 Panel Report, para. 7.345.

5.365. That said, Japan's argument in the context of its present claim under Articles 3.1 and 3.4,
regarding which it requests us to complete the legal analysis, encompasses broader considerations
than those addressed in the above findings by the Panel. Not only does Japan make the argument
about the positive trend experienced by domestic industry with respect to domestic sales, but it also
asserts that the KTC attached "a high degree of importance to the other relevant factors highlighting
negative aspects of the domestic industry, while disregarding or downplaying" those factors that
showed positive trends.984 Thus, Japan's contention that, in so doing, th e KTC acted inconsistently
with Articles 3.1 and 3.4 would require us to review the KTC's examination of impact and the weight
it attributed to each of the factors listed in Article 3.4. Indeed, as Japan argues, "[t]he KTC's analysis
of the relevant econom ic factors and indices of the domestic industry as listed in Article 3.4 were
mixed", and the KTC disregarded or downplayed "the many factors" that suggested that "the Korean
industry was not suffering injury."985 The Panel, however, did not have the occasion to engage with
these arguments in the context of Japan's claim under Articles 3.1 and 3.4. This was so because it
found Japan's allegation that the KTC attached a high degree of importance to the relevant factors
highlighting negative aspects, while disr egarding or downplaying those factors suggesting that the
Korean industry was not suffering injury, to fall outside its terms of reference .986 Although, in the
"Relevant facts" section, the Panel set out the Korean investigating authorities' evaluation of all the
economic factors listed in Article 3.4, the Panel did not engage and explore the question that Japan
now raises, namely, how the KTC's evaluation of all the relevant economic factors fits together to
support its overall examination regarding the impact of dumped imports on the state of the domestic
industry.987 These considerations suggest that engaging in the completion exercise would require us
to examine the relevance of each of the economic factors listed in Article 3.4 individually and conduct
a collective assessment in order to review the consistency of the KTC's impact examination under
Articles 3.1 and 3.4 with regard to which the Panel, notably, made no findings. Such an exercise, in
our view, would require us to review and consider evidence and arguments that were not sufficiently
addressed by the Panel or sufficiently explored and developed before the Panel.
5.366. Finally, Japan contends that, "[i]n the absence of a proper consideration of the dumped
imports' effects on the domestic like product as a whole, the impact examination in the present case
[is] necessarily inconsistent with Article 3.4".988 According to Japan, "[t]his problem is particularly
serious in this case, since the KTC improperly defined the domestic industry, and actually assessed
the impact of imports on only about half of the domestic industry."989 We recall that Japan has also
requested us to complete the legal analysis with respect to its claim under Articles 3.1 and 4.1 of
the Anti-Dumping Agreement and find that the Korean investigating authorities acted inconsistently
with th ese provisions in the determination of the "domestic industry" in the anti -dumping
investigation at issue. However, for the reasons stated above, we have found that we are unable to
complete the legal analysis in view of the dispute d nature of certain facts underlying the definition
of the domestic industry and the lack of the Panel's exploration of the relevant issues and evidence.
5.367. In light of the foregoing considerations, we find ourselves unable to comple te the legal
analysis as to whether the Korean investigating authorities acted inconsistently with Articles 3.1
and 3.4 of the Anti -Dumping Agreement on the basis of Japan's argument that the KTC failed to
adequately explain how imports had negatively impa cted the domestic like products as a whole in
light of positive trends experienced by the domestic industry.990
5.4 Confidential treatment of information
5.368. The Panel found that Japan's claims 8 and 9 concerning the Korean investigating authorities'
treatment of co nfidential information were within its terms of reference, and that Japan
demonstrated that the Korean investigating authorities acted inconsistently with Articles 6.5
and 6.5.1 of the Anti-Dumping Agreement. Korea appeals the Panel's findings pursuant to Article 6.2
of the DSU and , consequently, its conclusion that Japan's claims 8 and 9 were within its terms of
reference. Should we uphold the Panel's findings under Article 6.2 of the DSU, Korea also appeals
the Panel's findings that the Korean investigating authorities acted inconsistently with the obligations

984 Japan's appellant's submission, para. 251. (emphasis added)
985 Japan's appellant's submission, para. 251.
986 Panel Report, paras. 7.172 and 7.175.
987 We note that Japan submits that "this summary of relevant facts is somewhat less useful than the
others." (Japan's appellant's submission, para. 230)
988 Japan's appellant's submission, para. 241. (fn omitted)
989 Japan's appellant's submission, para. 241. (fn omitted)
990 Japan's appellant's submission, para. 250.

under Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement. Japan requests the Appellate Body to
uphold both the Panel's findings concerning its terms of reference and the findings on the merits of
Japan's claims.
5.369. We begin by assessing whether the Panel erred in finding that Japan's claims 8 and 9
concerning the confidential treatment of information were within its terms of reference. If we uphold
the Panel's findings under Article 6.2 of the DSU, we will proceed to determine whether the Panel
erred in its findings regarding the merits of Japan's claim s under Articles 6.5 and 6.5.1 of the
Anti-Dumping Agreement.
5.4.1 Whether the Panel erred in finding that Japan's claims 8 and 9 concerning the
confidential treatment of information were within its terms of reference
5.370. Claims 8 and 9 in Japan's panel request state that the measure at issue is inconsistent with
Korea's obligations under:
[] Article 6.5 of the [Anti-Dumping] Agreement because Korea treated allegedly
confidential information provided by the interested parties as confidential without good
cause shown;
[] Article 6.5.1 of the [Anti-Dumping] Agreement because Korea: ( a) failed to require
the applicants to furnish non-confidential summaries of their submissions, questionnaire
responses, and amendments thereof; and ( b) where such summaries were provided,
they were not in sufficient detail to permit a reasonable understanding of the substance
of the information submitted in confidence[.]
5.371. The Panel found that, on its face, the panel request provided a brief but sufficient explanation
as to how and why Japan consider ed the measures at issue to be violating the specific WTO
obligations in question, namely those in Articles 6.5 and 6.5.1 of the Anti -Dumping Agreement.
According to the Panel, this language was precise enough to both define the basis for the Panel's
terms of reference and inform other WTO Members, including the respondent, of the nature of the
dispute.991
5.372. The Panel found that its conclusion was confirmed by taking into account the scope of the
allegations concerning the alleged inconsistencies in the confidential treatment of information
advanced in Japan's submissions , namely that: (i) t he Korean investigating authorities granted
confidential treatment to certain information provided by the applicants without requiring a showing
of good cause and with out conducting an objective assessment to justify the confidentiality; and
(ii) with respect to certain documents, the Korean investigating authorities failed to require that
submitting parties provide a non -confidential summary of the information that was treated as
confidential or to show why such a summary could not be provided.992 Furthermore, the Panel noted
that, in its first written submission to the Panel, Japan identified 38 specific elements of information
that are the basis of its claims under Articles 6.5 and 6.5.1 of the Anti -Dumping Agreement. The
Panel indicated that these specific elements of information, which were allegedly granted confidential
treatment without good cause shown, may be seen as part of the arguments advanced by Japan in
support of its claims . Consequently, the Panel considered that Japan was not required to include
these specific elements in the panel request.993
5.373. Accordingly, the Panel found that Japan's claims concerning the confidential treatment of
information under Articles 6.5 and 6.5.1 of the Anti -Dumping Agreement were within its terms of
reference.994
5.374. On appeal, Korea argues that the Panel erred in finding th at Japan's panel request, with
respect to the claims under Articles 6.5 and 6.5.1, comported with the obligation under Article 6.2
of the DSU to "provide a brief summary of the legal basis of the complaint sufficient to present the

991 Panel Report, para. 7.415.
992 Panel Report, para. 7.416.
994 Panel Report, para. 7.418.

problem clearly".995 Korea submits that the panel request "merely paraphrases the relevant legal
obligations under Articles 6.5 and 6.5.1 without providing any additional information explaining the
how and why of its claims".996 Korea argues that, with respect to the claim under Article 6.5, in light
of the wording of Japan's panel request, it is not possible to identify what allegedly confidential
information is concerned by the claim, or, at a minimum, the subject matter of that allegedly
confidential information.997 Korea maintains that, by resorting to Japan's subsequent submission,
the Panel failed to adhere to the principle that the panel request must be examined on its face as it
existed at the time of the filing, and that defects therein cannot be cured in subsequent submissions
during the panel proceedings.998 Korea also argues that, with respect to Article 6.5.1, Japan's panel
request similarly fails to explain the "how or why" of Japan's claim, as nothing in it links the claim
to the particular circumstances of the investigation at issue. Korea adds that the Panel also erred by
relying on the examination of Japan's subsequent submissions.999
5.375. Japan responds that the panel request expressly identifies Articles 6.5 and 6.5.1 of the
Anti-Dumping Agreement as the specific provisions at issue for these two claims. Furthermore, the
panel request identifies the obligation under Article 6.5 to grant confidential treatment to information
that is by nature confidential or provided on a confidential basis "upon good cause shown", and the
obligation under Article 6.5.1 to require the provision of non -confidential summaries "in sufficient
detail".1000 Japan contends that the language it used in its panel request presents the problem clearly
by connecting the measure at issue and the alleged inconsistencies, in light of the nature and scope
of the particular obligations. Japan submits that "[t]he essence of these two claims is that the KTC
conducted its investigation by just assuming that certain information was confidential without any
specific inquiry, and accepted the absence of any non-confidential summaries, as evidenced through
the KTC's Final Resolution and the OTI's Final Report." 1001 Japan also indicates that Korea's
arguments confuse the claim with the arguments in support of the claim.1002
5.376. We indicated in section 5.1.1 above that a panel is to determine whether a panel request
complies with the requirements of Article 6.2 of the DSU by examining the panel request on its face,
taking into consideration the circumstances of the case, including the nature of the measure and the
nature of the provisions concerned. In order to provide the legal basis of the complaint sufficient to
present the problem clearly, a panel request must plainly connect the challenged measure with the
obligation alleged to have been breached. In this regard, a complainant must, at a minimum, identify
the provisions in the covered agreement alleged to have been breached.1003
5.377. Like the Panel, we observe that Japan has, in its claims 8 and 9 in th e panel request ,
identified Articles 6.5 and 6.5.1 of the Anti -Dumping Agreement as the provisions of the covered
agreement alleged to have been breached.1004 Thus, Japan meets the minimum requirement under
Article 6.2 of the DSU to identify the relevant provisions alleged to have been breached. As indicated
above, in some circumstances, particularly where the provisions concerned establish multiple
obligations, it will not be sufficient merely to list the provisions in question in a panel request. In
considering the nature of the provisions, therefore, we will seek to determine whether such
circumstances arise in this dispute.
5.378. With regard to the nature of the measure, we observe that the narrative included in Japan's
claims 8 and 9 indicate that they respecti vely concern Korea's treatment of certain information as

995 Korea's other appellant's submission, para. 304. In particular, Korea argues that nothing in the
Panel's findings suggests that the Panel examined this important question. Indeed, the Panel did not take into
account the nature of the measure at issue and the manner in which it was described in the panel request and
did not examine the nature and scope of the provisions of the covered agreements alleged to have been
breached. (Ibid.)
996 Korea's other appellant's submission, para. 305. (emphasis original)
997 Korea's other appellant's submission, para. 307.
998 Korea's other appellant's submission, para. 310 (referring to Appellate Body Report, US – Carbon
Steel, para. 127).
999 Korea's other appellant's submission, para. 311.
1000 Japan's appellee's submission, para. 161.
1001 Japan's appellee's submission, para. 162 (referring to Japan's second written submission to the
Panel, paras. 209-211 and 214-234).
1002 Japan's appellee's submission, para. 165 (referring to Korea's other appellant's submission,
paras. 307-309).
1003 See para. 5.6 above.
1004 See Panel Report, paras. 7.414-7.415.

confidential under Article 6.5 of the Anti-Dumping Agreement, and Korea's treatment of summaries
of confidential information under Article 6.5.1 of the Anti -Dumping Agreement. It is therefore a
specific portion of the measure at issue that is concerned by Japan's claims 8 and 9.
5.379. With regard to the nature of the provisions concerned, under Article 6.5, authorities must
treat information submitted by parties to an investigation as confidential if it is "by nature"
confidential or if it is "provided on a confidential basis" , and "upon good cause shown".1005 In
addition, Article 6.5 provides illustrative examples of information that falls into the category of "by
nature" confidential.1006
5.380. Article 6.5 of the Ant i-Dumping Agreement thus establishes a clear and well -delineated
obligation, such that referencing this provision in a panel request , and connecting it to the specific
portion of the measure at issue, suffices to comply with the requirements of Article 6.2 of the DSU.
Thus, we agree with the Panel that, by indicating that Japan considers Korea to have breached
Article 6.5 because Korea treated allegedly confidential information provided by the interested
parties as confidential without good cause shown, claim 8 in Japan's panel request has provided a
brief summary of the legal basis sufficient to present the problem clearly, including by plainly
connecting the challenged measure with the obligation alleged to have been breached.
5.381. With respect to Japan's claim pursuant to Article 6.5.1 of the Anti-Dumping Agreement, we
recall that Japan's claim 9, which is described in paragraph 5.370 above, refers specifically to the
first two sentences of Article 6.5.1.1007 In essence, these two sentences oblige the investigating
authority to require non -confidential summaries of confidential information in sufficient detail to
permit a reasonable understanding of the substance of the information submitted in confidence.
5.382. The portion of Article 6.5.1 specifically referenced in Japan's claim 9 establishes a clear and
well-delineated obligation, such that referencing these sentences suffices to pr ovide a clear
indication of the legal basis of Japan's complaint under this claim. Specifically, the narrative of
Japan's claim makes clear that it takes issue with the alleged failure of the Korean investigating
authorities: (i) to require the applicants to furnish non-confidential summaries of their submissions,
questionnaire responses, and amendments thereof; and (ii) where such summaries were provided,
to ensure that they were in sufficient detail to permit a reasonable understanding of the substance
of the information submitted in confidence. In our view, therefore, Japan's claim sufficiently connects
the measures at issue with the alleged violation of Article 6.5.1.
5.383. Korea argues that "[a]s a general matter, large volumes of confidential information are
received and assessed by investigating authorities in an anti -dumping investigation, and the
underlying investigation to this dispute was no exception ."1008 However, in light of the wording of
the panel request, "there is no way to identify what allegedly co nfidential information is concerned
by the claim or, at a minimum, the subject matter of that allegedly confidential information." 1009
However, we recall that Article 6.2 demands only "a brief summary" of the legal basis of the

1005 We recall that Article 6.5 of the Anti-Dumping Agreement provides:
Any information which is by nature confidential (for example, because its disclosure would be of
significant competitive advantage to a competitor or because its disclosure would have a
significantly adverse effect upon a person supplying the information or upon a person from whom
that person acquired the information), or which is provided on a confidential basis by parties to
an investigation shall, upon good cause shown, be treated as such by the authorities. Such
information shall not be disclosed without specific permission of the party submitting it.
1006 Appellate Body Report, EC – Fasteners (China), para. 536. The Appellate Body indicated, for
instance, that "[o]ne type of such information is commercially sensitive information not typically disclosed in
the normal course of business, and which would likely be regularly treated as confidential in anti-dumping
investigations" and that "[t]his could be the case, for example, for certain profit or cost data or proprietary
customer information." (Ibid., para. 536 and fn 775 thereto)
1007 We recall that Article 6.5.1 of the Anti-Dumping Agreement provides:
The authorities shall require interested parties providing confidential information to furnish
non-confidential summaries thereof. These summaries shall be in sufficient detail to permit a
reasonable understanding of the substance of the information submitted in confidence. In
exceptional circumstances, such parties may indicate that such information is not susceptible of
summary. In such exceptional circumstances, a statement of the reasons why summarization is
not possible must be provided.
1008 Korea's other appellant's submission, para. 307.
1009 Korea's other appellant's submission, para. 307.

complaint.1010 To require Japan to detail all allegedly confidential information concerned would
appear to impose a burden that would go beyond what is required under Article 6.2. For these
reasons, we share the Panel's view that specific elements of information that allegedly were granted
confidential treatment without good cause shown may be seen as part of the arguments advanced
by Japan in support of its claim, which need not be included in the panel request. 1011 Thus, in our
view, the Panel did not inappropriately rely on Japan's subsequent submissions 1012, but rather did
so to confirm that the claims listed in Japan's panel request were sufficient to present the problem
clearly.
5.384. In sum, Japan's claims 8 and 9 concerning the confidential treatment of information identify
Articles 6.5 and 6.5.1 of the Anti -Dumping Agreement, respectively, as the provisions alleged to
have been breached. Japan's claims also indicate that they relate, respectively, to the specific portion
of the measure at issue concerning Korea's treatment of certain information as confidential under
Article 6.5 of the Anti-Dumping Agreement, and Korea's treatment of non-confidential summaries of
confidential information under Article 6.5.1 of the Anti-Dumping Agreement. Article 6.5 establishes
a clear and well-delineated obligation for investigating authorities to treat information submitted by
parties to an investigation as confidential if it is "by nature" confidential or "provided on a confidential
basis", and "upon good cause shown". In addition, Japan's claim 9 refers to the first two sentences
of Article 6.5.1, which set forth a clear and well-delineated obligation for the investigating authority
to require non-confidential summaries in sufficient detail to permit a reasonable understanding of
the substance of the information submitted in confidence. Therefore, Japan's claims 8 and 9 each
"provide a brief summary of the legal basis of the complaint sufficient to present the problem clearly"
within the meaning of Article 6.2 of the DSU.
5.385. For the foregoing reasons, we find that the Panel did not err in finding that Japan's claims 8
and 9, concerning the confidential treatment of information, were within its terms of reference.
Consequently, we uphold the Panel's findings in paragraphs 7.418 and 8.2.e of the Panel Report.
5.4.2 Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement
5.386. Korea appeals the Panel's findings under Articles 6.5 and 6.5.1 of the
Anti-Dumping Agreement. With respect to Article 6.5, Korea argues that the Panel committed legal
error in its interpretation and application of this provision. In addition, Korea contends that the Panel
erred in its application of Article 6.5.1 of the Anti-Dumping Agreement.
5.4.2.1 Article 6.5 of the Anti-Dumping Agreement
5.4.2.1.1 The Panel's findings
5.387. Before the Panel, Japan argued that Korea acted inconsistently with Article 6.5 of the
Anti-Dumping Agreement because the KTC granted confidential treatment to certain information
provided by the applicants without requiring a showing of good cause and without conducting an
objective assessment to justify the confidential treatment.1013
5.388. The Panel indicated that "con fidential information" within the meaning of Article 6.5 is
information that is: "(a) by nature confidential; or (b) provided on a confidential basis by parties to
an investigation". 1014 Moreover, pursuant to this provision, "upon good cause shown", an
investigating authority must treat such information as confidential and not disclose it without the
permission of the submitter. The Panel pointed out that "[s]howing good cause is thus a 'condition
precedent for according confidential treatment to information s ubmitted to an authority'." 1015 The
Panel added that "[t]he requirement to show good cause applies to all information for which

1010 Emphasis added.
1011 Panel Report, para. 7.417.
1012 Korea's other appellant's submission, para. 311.
1013 Panel Report, para. 7.391.
1014 Panel Report, para. 7.422.
1015 Panel Report, para. 7.423 (quoting Appellate Body Report, EC – Fasteners (China)
(Article 21.5 – China), para. 5.38).

confidential treatment is sought, whether it is by nature confidential or submitted on a confidential
basis."1016
5.389. In the case at hand, the Panel considered that the main issue under Article 6.5 was whether
the KTC granted confidential treatment to certain information provided by the applicants without
requiring a showing of good cause and without an objective assessment of that showing t o justify
the confidential treatment.1017 The Panel specified that it would focus its analysis on the 38 elements
of information that Japan alleged were treated as confidential without the KTC having required and
assessed whether there was good cause for such treatment.1018
5.390. The Panel indicated that a series of facts was undisputed by the parties. First, Article 15 of
Korea's Enforcement Rule of the Customs Act lists five categories of information that are entitled to
confidential treatment in anti-dumping investigations.1019 Second, in the anti-dumping investigation
at issue, the applicants filed "Disclosed", or public, versions of at least three of their written
submissions.1020 Certain information was redacted from these documents by being either removed
entirely or replaced with an "X" or asterisks. The Panel added that, with respect to these
submissions, in the course of the investigation, the responding companies had access only to the
redacted versions.1021
5.391. Moreover, the Panel noted that there is no expli cit mention of "good cause" in any of the
three public versions of the written submissions or any link therein between the redacted information
and the categories laid out in Article 15 of the Enforcement Rule of the Customs Act. 1022 Likewise,
there is no spe cific indication in the relevant documents on the record that the KTC or the OTI
assessed whether good cause had been shown by the applicants .1023 Consequently, the Panel
considered it clear that the Korean investigating authorities granted confidential treatment to certain
information provided by the applicants "without any evidence that a showing of good cause that
would justify the confidential treatment had been required from the applicants".1024
5.392. Korea argued before the Panel that the 38 items of information identified by Japan fall into
the list set out in Article 15 of the Enforcement Rule of the Customs Act describing types of
information to be treated as confidential.1025 Korea asserted that, as a consequence, there was good
cause to treat this information as confidential. In this regard, Korea argued that the KTC "objectively
assessed … whether the information was of the types for which Korean laws afford confidential
protection" and "confirmed the 'good cause'" on the basis of this examination.1026
5.393. However, the Panel considered that there is no evidence on the record to support Korea's
argument that the KTC objectively assessed whether there was "good cause" for treating certain
information as confidential. As highlighted by the Panel, there was nothing on the record indicating
that the applicants had specified or the Korean investigating authorities had taken into account
whether the information in question fell into any of the categories set out in the relevant Korean

1016 Panel Report, para. 7.423.
1017 Panel Report, para. 7.427.
1018 Panel Report, para. 7.428 (referring to Japan's first written submission before the Panel,
paras. 266-269 and annex III).
1019 Under Article 15 of the Enforcement Rule of the Customs Act, the five categories of information that
are entitled to confidential treatment in anti-dumping investigations are: (a) costs of production; (b)
accounting materials which have not been made public; (c) name, address, and trade volumes of trade
partners; (d) matters concerning the provider of confidential information; and (e) other materials adequately
deemed as confidential. (Panel Report, para. 7.430 (referring to Article 15 of the Enforcement Rule of the
Customs Act of Korea (Panel Exhibit KOR-34b)))
1020 The three submissions with respect to which the applicants filed "Disclosed", or public, versions are:
(i) the investigation application dated 23 December 2013; (ii) the summary of opinion from attorneys dated
23 October 2014; and (iii) the rebuttal opinion of applicants dated 13 November 2014. (Panel Report,
para. 7.431)
1021 Panel Report, para. 7.431.
1022 Panel Report, para. 7.432 (referring to Korea's response to Panel question No. 113, para. 104).
1023 Panel Report, para. 7.432.
1024 Panel Report, para. 7.434. Indeed, according to the Panel, "there is no evidence on record that the
applicants made any indication as to the existence of good cause for confidential treatment, nor is there any
evidence that the Korean Investigating Authorities requested that such good cause be shown." (Ibid.)
1025 Panel Report, para. 7.438.
1026 Panel Report, para. 7.435 (quoting Korea's response to Panel question No. 69).

legislation. The Panel indicated that, in these circumstances, it could not conclude that the Korean
investigating authorities "actually engaged in a consideration of whether the submitters of the
information had shown good cause for confidential treatment of the information in question".1027 The
Panel added that "the existence in the legislation of defined categories of information that will
normally be treated as confidential does not relieve the investigating authorities of their obligation
to determine that good cause has been shown to justify the confidential treatment requested by the
submitting party."1028
5.394. For the foregoing reasons, the Panel found that, with respect to the 38 items of information
identified by Japan, the submitters did not show good cause for the conf idential treatment of that
information. On that basis, the Panel concluded that, with respect to the information at issue, the
Korean investigating authorities did not act consistently with Article 6.5 of the
Anti-Dumping Agreement.1029
5.4.2.1.2 Whether the Panel erred in its interpretation or application of Article 6.5 of the
Anti-Dumping Agreement
5.395. Korea maintains that the Panel committed two errors of law under Article 6.5 of the
Anti-Dumping Agreement. First, the Panel erred "when considering that investigating authorities
must make statements in the record demonstrating that 'good cause' was assessed and found to
exist for the confidential treatment of certain pieces or categories of informat ion".1030 In Korea's
view, investigating authorities are not required to make an express "statement" as to whether good
cause is shown. Instead, under Article 6.5, "an authority must satisfy itself (i.e. 'ensure') that good
cause is shown before treating the information in question as confidential."1031 Second, Korea argues
that, as a result of its erroneous interpretation of Article 6.5, the Panel also erred in applying the
law to the facts of this case. In particular, the Panel erred in finding that "[the] KTC failed to show
that good cause was shown for certain pieces of evidence as there was no evidence on the record
'linking the information for which confidential treatment was granted to the categories of confidential
treatment identified in Korean law'." 1032 Korea maintains that, based on a proper application of
Article 6.5, the KTC was not obliged to make specific statements about each of the requests for
confidentiality other than to "satisfy itself" that good cause was shown before treating the
information in question as confidential.1033
5.396. Japan responds that the Panel properly found that, in the underlying investigation, the KTC
failed to establish that "good cause" was shown for treating certain information as confidential,
contrary to the requirements of Article 6.5 of the Anti -Dumping Agreement. According to Japan,
Article 6.5 conditions the granting of confidential treatment "upon good cause shown", and such
condition is not met merely "if good cause exists". 1034 Japan thus disagrees with Korea's argument
that "every interested party 'implicitly asserts' the required 'good cause' by deleting allegedly
confidential information in the public version of its submissions."1035 For Japan, Korea dismisses the
importance of the explicit textual requirement that good cause must be "shown" and cannot merely
be presumed to exist. Indeed, "[a]bsent some showing of 'good cause', a panel has no way to review
what the authority has done and whether it complies with Article 6.5."1036

1027 Panel Report, para. 7.440.
1028 Panel Report, para. 7.438.
1029 Panel Report, para. 7.441.
1030 Korea's other appellant's submission, para. 326.
1031 Korea's other appellant's submission, para. 327.
1032 Korea's other appellant's submission, para. 315 (quoting Panel Report, para. 7.436).
1033 Korea's other appellant's submission, para. 330 (referring to Korea's response to Panel question
No. 65).
1034 Japan's appellee's submission, para. 169.
1035 Japan's appellee's submission, para. 170 (referring to Korea's other appellant's submission,
paras. 330-331).
1036 Japan's appellee's submission, para. 171. (emphasis omitted)

5.397. As we see it, Korea's position is that an investigating authority could comply with Article 6.5
simply by "satisfy[ing] itself (i.e. 'ensur[ing]')" 1037 that good cause is shown, even in a situation
where there is no indication on the record of the underlying in vestigation establishing that such
authority conducted an objective assessment as to whether good cause was shown. In addressing
Korea's argumentation, we begin by recalling the legal standard under Article 6.5 of the
Anti-Dumping Agreement.
5.398. Past interpretations of Article 6.5 by the Appellate Body can be summarized as follows. The
requirement to show "good cause" for confidential treatment applies to both information that is "by
nature" confidential and that which is provided to the authority "on a confide ntial basis".1038 The
"'good cause' alleged must constitute a reason sufficient to justify the withholding of information
from both the public and from the other parties interested in the investigation". 1039 Moreover, the
"'[g]ood cause' must be assessed and det ermined objectively by the investigating authority, and
cannot be determined merely based on the subjective concerns of the submitting party." 1040 More
specifically, "a party seeking confidential treatment for information must make its 'good cause'
showing to the investigating authority upon submission of the information. The authority must
objectively assess the 'good cause' alleged for confidential treatment, and scrutinize the party's
showing in order to determine whether the submitting party has sufficient ly substantiated its
request."1041 In any event, "[t]he obligation remains with the investigating authority to examine
objectively the justification given for the need for confidential treatment." 1042 Thus, an authority
would be acting inconsistently with its ob ligation under Article 6.5 "[i]f information is treated as
confidential … without such a 'good cause' showing having been made". 1043 Importantly, "a panel
tasked with reviewing whether an investigating authority has objectively assessed the 'good cause'
alleged by a party must examine this issue on the basis of the investigating authority's published
report and its related supporting documents, and in the light of the nature of the information at
issue and the reasons given by the submitting party for its request for confidential treatment."1044
5.399. Thus, while interested parties must make a "good cause" showing that certain information
should be treated as confidential, it is ultimately for the investigating authority to conduct an
"objective assessment" of this issue to determine whether the request for confidential treatment has
been sufficiently substantiated such that confidential treatment should be granted. Article 6.5 does
not prescribe the particular steps that investigating authorities should take in order to assess and
determine whether "good cause" has been "shown". However, in the context of WTO dispute
settlement, a panel may be asked to examine a claim under Article 6.5 as to whether an investigating
authority properly examined and determined that "good c ause" had been shown in granting
confidential treatment to certain information. This examination by a panel should be based on the

1037 Korea's other appellant's submission, para. 327. Similarly, Korea argues:
In light of the fact that Article 6.5 only requires investigating authorities to satisfy themselves
that good cause is shown before treating the information in question as confidential, [the] KTC
was not obliged to make specific statements about each of the requests for confidentiality other
than to satisfy itself that good cause was shown before treating the information in question as
confidential.
(Ibid., para. 315)
1038 Appellate Body Report, EC – Fasteners (China), para. 537. With regard to the difference between
the two types of information, the Appellate Body indicated in EC – Fasteners (China) that the question whether
information is "by nature" confidential depends on the content of the information. Confidentiality of such
information "will often be readily apparent", as the illustrative examples provided in Article 6.5 show. (Ibid.,
para. 536) Information that is "provided on a confidential basis" is not necessarily confidential by reason of its
content, but rather, confidentiality arises from the circumstances in which it is provided to the authorities.
According to the Appellate Body, these two categories may, in practice, overlap. (Ibid.)
1039 Appellate Body Report, EC – Fasteners (China), para. 537. The Appellate Body elaborated that,
"[p]ut another way, 'good cause' must demonstrate the risk of a potential consequence, the avoidance of which
is important enough to warrant the non-disclosure of the information." (Ibid.)
1040 Appellate Body Report, EC – Fasteners (China), para. 537.
1041 Appellate Body Report, EC – Fasteners (China), para. 539. In making its assessment, "the
investigating authority must seek to balance the submitting party's interest in protecting its confidential
information with the prejudicial effect that the non-disclosure of the information may have on the transparency
and due process interests of other parties involved in the investigation to present their cases and defend their
interests." (Ibid. (fn omitted))
1042 Appellate Body Report, EC – Fasteners (China), para. 539.
1043 Appellate Body Report, EC – Fasteners (China), para. 539.
1044 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.97. (fn omitted)

investigating authority's "published report and its related supporting documents" in which the
assessment of "good cause" must be discernible.1045
5.400. Korea maintains that the Panel erred in the interpretation of Article 6.5 "when considering
that investigating authorities must make statements in the record demonstrating that 'good cause'
was assessed and found to exist for the confidential treatment of certain pieces or categories of
information".1046 In Korea's view, investigating authorities are simply not required to make an
express "statement" as to whether good cause is shown. Instead, under Article 6.5, "an authority
must satisfy itself (i.e. 'ensure') that good cause is shown before treating the information in question
as confidential."1047
5.401. We turn to examine the Panel's articulation of the legal standard under Article 6.5 as it
relates to Korea's argument. The Panel stated that "[s]howing good cause is … a 'condition precedent
for according confidential treatment to information submitted to an authority'."1048 The Panel added
that "'good cause' means a reason that is sufficient to justify withholding information from both the
public and the other parties to the investigation, and that a showing of 'good cause' involves 'a
demonstration of a risk of a potential consequence, the avoidance of which is important enough to
warrant the non-disclosure of the information'."1049 In addition, the Panel indicated that "[t]here is
no explicit requirement in Article 6.5 that a showing of good cause be made in respect of each
individual item of information."1050 Thus, "good cause may be shown in respect of general categories
of information."1051 At the same time, the Panel highlighted that, "if an investigating authority treats
as confidential information in respect of which no good cause has been shown, that investigating
authority acts inconsistently with its obligation under Article 6.5."1052
5.402. As we see it, in articulating the legal standard under Article 6.5, the Panel did not pronounce
on the specific manner in which investigating authorities should specify that "good cause" was shown
when granting confidential treatment to certain information. Under Article 6.5, an investigating
authority is required to assess objectively whether the request for confidential treatment has been
sufficiently substantiated such that "good cause" has been shown. The fact that the investigating
authority has conducted this objective assessment must be discernible from its published report or
related supporting documents. In our view, the Panel's articulation comports with the legal standard
under Article 6.5, as described above. Consequently, we do not consider that the Panel com mitted
legal error in its interpretation of Article 6.5 of the Anti-Dumping Agreement.
5.403. Korea further argues that the Panel erred in finding that "[the] KTC failed to show that good
cause was shown for certain pieces of evidence as there was no evidence on the record 'linking the
information for which confidential treatment was granted to the categories of confidential treatment
identified in Korean law'."1053 Korea maintains that, based on a proper application of Article 6.5, the
KTC was not obliged to make specific statements about each of the requests for confidentiality other
than to satisfy itself that good cause was shown before treating the information i n question as
confidential.1054
5.404. To the extent that Korea is suggesting that an investigating authority would comply with
Article 6.5 in a situation where there is no indication on the record establishing that such authority
conducted an objective assessment a s to whether good cause was shown, we disagree. Under
Article 6.5, the fact that an investigating authority objectively assessed and determined that "good
cause" was "shown" must be discernible from its published report or related supporting documents.

1045 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.97.
1046 Korea's other appellant's submission, para. 326.
1047 Korea's other appellant's submission, para. 327.
1048 Panel Report, para. 7.423 (quoting Appellate Body Report, EC – Fasteners (China)
(Article 21.5 – China), para. 5.38).
1049 Panel Report, para. 7.423 (quoting Appellate Body Report, EC – Fasteners (China)
(Article 21.5 – China), para. 5.37; referring to Appellate Body Report, EC – Fasteners (China), para. 537).
1050 Panel Report, para. 7.424.
1051 Panel Report, para. 7.424.
1052 Panel Report, para. 7.424.
1053 Korea's other appellant's submission, para. 315 (quoting Panel Report, para. 7.436).
1054 Korea's other appellant's submission, para. 330.

Without such indication, we fail to see how a panel would be expected to review a claim under
Article 6.5 of the Anti-Dumping Agreement.
5.405. Moreover, Korea asserts that the applicants submitted non -confidential summaries, which
were prepared by deleting from their submissions the information with respect to which they sought
confidential treatment. According to Korea, in submitting these non -confidential summaries, the
provider of the information "implicitly assert[ed] that such deleted information falls within the
categories of 'confidential information' specifically set forth in the relevant laws in Korea (in
particular, the Enforcement Decree and Enforcement Rule of the Customs Act of Korea), or
recognized as such in Korea's anti -dumping practice". 1055 Korea furt her submits that, in the
underlying investigation, when the KTC received such non -confidential summaries from the
applicants, it regarded such summaries as a request by the applicants that the deleted information
be treated as confidential, and "it objecti vely assessed whether there was indeed 'good cause' by
confirming whether the deleted information fell within a category of confidential information
enumerated in the relevant Korean laws."1056
5.406. Japan considers that, contrary to Korea's assertions, the Panel rightly found that there is no
evidence on the record indicating that a showing of good cause was required by the authorities, or
made by the applicants, prior to the KTC's decision to grant confidential treatment. 1057 Moreover,
Japan asserts that, while a Mem ber's legislation may set out specific categories of information for
which confidential treatment will normally be granted, this is not sufficient to comply with Article 6.5.
Indeed, for Japan, the existence of such legislation "does not relieve the invest igating authority of
its obligation under Article 6.5 to determine that 'good cause' has been 'shown' to justify the
confidential treatment requested by the submitting party". 1058 Japan argues that there is no
indication on the record that, in granting confidential treatment, either the applicants had specified
or the Korean investigating authorities had taken into account whether the information in question
fell into any of the enumerated categories under Korean law.1059
5.407. As we understand it, Korea's claim that t he Panel erred in finding an inconsistency with
Article 6.5 is based on two related arguments regarding the conduct of the interested parties in the
underlying investigation and the role of the KTC. We address each of these arguments in turn.
5.408. With respect to the showing of good cause by interested parties, Korea's position is that, in
providing non -confidential summaries by way of deleting the relevant information from their
submissions1060, the providers of the information "implicitly" asserted that such deleted information
fell within the categories of "confidential information" set forth in the relevant Korean laws. As a
consequence of that "implicit" assertion, Korea argues, "good cause" was "shown" for granting
confidential treatment to that information.
5.409. As asserted by Korea, under its relevant legislation, certain categories of information are
entitled to confidential treatment in anti-dumping investigations. In this regard, the Panel specified
that, "under the relevant Korean legislation (Article 15 of the Enforcement Rule of the Customs Act),
the following information is entitled to confidential treatment in anti -dumping investigations,
because its disclosure may infringe the interests of the person supplying the information or another
interested party: (a) costs of production; (b) accounting materials which have not been made public;

1055 Korea's other appellant's submission, para. 331. (fn omitted)
1056 Korea's other appellant's submission, para. 332 (referring to Korea's first written submission to the
Panel, para. 337). Korea adds that, "in applying the relevant provisions of the Korean law on confidential
treatment of information, [the] KTC also considered that the requested confidential information [was] 'by
nature' commercially-sensitive information … which would likely be regularly treated as confidential in
1057 Japan's appellee's submission, para. 170 (referring to Panel Report, para. 7.434).
1058 Japan's appellee's submission, para. 172 (referring to Panel Report, para. 7.438).
1059 Japan's appellee's submission, para. 172.
1060 The applicants filed "Disclosed", or public, versions of at least three of their written submissions (the
investigation application dated 23 December 2013, the summary of opinion from attorneys dated
23 October 2014, and the rebuttal opinion of applicants dated 13 November 2014) from which certain
information was redacted. With respect to these submissions, in the course of the investigation, the responding
companies had access only to the redacted versions. (Panel Report, para. 7.431) Korea argued before the
Panel that the version of the applicants' submissions from which confidential information was deleted
constitutes the non-confidential summary required by Article 6.5.1. (Panel Report, para. 7.442 (referring to
Korea's first written submission to the Panel, paras. 341-343; response to Panel question No. 65(a)))

(c) name, address, and trade volumes of trade partners; (d) matters concerning the provider of
confidential information; and (e) other materials adequately deemed as confidential."1061 The Panel
further indicated that "[t] he legislation also provides that information that is by nature deemed
confidential or that is submitted by the interested party on a confidential basis, showing good cause,
shall not be disclosed by the Korean Investigating Authorities without an explicit consent of the
provider."1062
5.410. However, while the Panel did not see a "reason a priori why a Member's legislation may not
set out specific categories of information for which confidential treatment will nor mally be
granted"1063, it was ultimately not convinced that, in the present case, the existence of such a list
sufficed to establish "good cause" for the confidential treatment of the information at issue. Indeed,
the Panel highlighted that "there is no indic ation on the record that, in granting confidential
treatment, either the applicants specified, or the Korean Investigating Authorities took into account,
whether the information in question fell into any of those categories."1064 Similarly, the Panel found
that "[t]here is also nothing specific in any of the[] three written submissions [ from which certain
information was redacted] linking the redacted information to any of the categories laid out in
Article 15 of the Enforcement Rule of the Customs Act."1065 Moreover, the Panel went on to add that
"some of the categories described in the [Korean] legislation are so general (for example: accounting
materials which have not been made public; matters concerning the provider of confidential
information; or other mater ials adequately deemed as confidential) that the mere invocation of a
specific category might in itself be insufficient to substantiate the alleged good cause for confidential
treatment."1066
5.411. On the basis of the above reasons, the Panel rejected Korea's argument that the applicants
had made a showing of "good cause" in the underlying investigation by "implicitly" indicating that
the redacted information fell within the categories of "confidential information" set forth in the
relevant Korean laws. In this rega rd, we recall that "a party seeking confidential treatment for
information must make its 'good cause' showing to the investigating authority upon submission of
the information."1067 We doubt that an "implicit" indication by way of redacting certain informatio n
from a submission would suffice for establishing such a showing of good cause. In our view, the
mere redaction of information does not establish, in and of itself, that such information falls within
certain legal categories for confidential information, let alone that there is good cause for treating
certain information as confidential. Thus, we share the Panel's view that, although Korea's relevant
legislation sets out certain categories of information entitled to confidential treatment, a total
absence of any indication in the underlying investigation as to how the information redacted from
the submissions relates to the general categories of information set out in the law appears
insufficient to demonstrate the showing of good cause by the interested parties.
5.412. Turning to Korea's argument regarding the role played by the KTC, Korea's position is that,
when the KTC received such non-confidential summaries, it objectively assessed whether there was
indeed "good cause" by confirming whether the deleted inform ation fell within a category of
confidential information set out in the relevant Korean laws. 1068 Korea further contends that, "[i]n
applying the relevant provisions of the Korean law on confidential treatment of information, [the]
KTC also considered that th e requested confidential information [was] by nature
'commercially-sensitive information (such as profit or cost data or proprietary customer information)
that is not typically disclosed in the normal course of business and which would likely be regularly
treated as confidential in anti-dumping investigations'."1069

1061 Panel Report, para. 7.430 (referring to Article 15 of the Enforcement Rule of the Customs Act
(Panel Exhibit KOR-34b)).
1062 Panel Report, para. 7.430.
1063 Panel Report, para. 7.438.
1064 Panel Report, para. 7.438.
1065 Panel Report, para. 7.432 (referring to Korea's response to Panel question No. 113, para. 104).
1067 Appellate Body Report, EC – Fasteners (China), para. 539.
1068 Korea's other appellant's submission, para. 332 (referring to Korea's second written submission to
the Panel, para. 337).
1069 Korea's other appellant's submission, para. 333 (quoting Appellate Body Report, EC – Fasteners
(China), para. 536).

5.413. Before the Panel, Korea also presented this line of argumentation. 1070 However, the Panel
was not convinced, given that it found no supporting evidence on the record.1071 In particular, the
Panel pointed out that, "[w]hile such a procedure [by the KTC] may be sufficient to satisfy the
requirements of Article 6.5, in the absence of anything in the submissions themselves, or evidence
otherwise on the record, linking the information for which confidential treatment was granted to the
categories of confidential information identified in Korean law, [it could not] conclude that the Korean
Investigating Authorities actually engaged in the asserted procedure."1072 For the foregoing reasons,
the Panel found that, with respect to the 38 items of information identified by Japan, the submitters
of the information did not show good cause for the confidential treatment of that information.
Consequently, the Panel concluded that, with respect to the informati on at issue, the Korean
investigating authorities did not act consistently with Article 6.5 of the Anti-Dumping Agreement.1073
5.414. In our view, the Panel's analysis is consistent with Article 6.5, as interpreted by the
Appellate Body in past disputes. Indeed, the Panel maintained that "the existence in the legislation
of defined categories of information that will normally be treated as confidential does not relieve the
investigating authorities of their obligation to determine that good cause has been shown to ju stify
the confidential treatment requested by the submitting party." 1074 This is consistent with the
Appellate Body's statement that "[t]he obligation remains with the investigating authority to
examine objectively the justification given for the need for con fidential treatment"1075, and that, to
comply with this obligation, "[t]he authority must objectively assess the 'good cause' alleged … and
scrutinize the party's showing" in order to determine whether the party has substantiated its request
for confidential treatment.1076 On appeal, Korea offers no arguments challenging the Panel's factual
findings indicating that there is nothing on the record of the underlying investigation establishing
that the Korean investigating authorities objectively assessed whether good cause had been "shown"
before granting the confidential treatment. Given those findings by the Panel, we are unable to agree
with Korea's argument.1077
5.415. Korea's position is ultimately premised on the erroneous understanding that an investigating
authority would comply with Article 6.5 merely by "satisfy[ing] itself that good cause was shown",
even in a situation where there is no indication in an investigating authority's published report or its
related supporting documents that the authority conducted an objective assessment as to whether
good cause was shown. We consider that the Panel correctly rejected this position. The Panel
observed that " there is no evidence on the record linking the information for which confidential
treatment was granted to the categories of information warranting confidential treatment identified
in Korean law."1078 The Panel emphasized that, i n this situation, it could not "conclude that the
Korean Investigating Authorities actually engaged in a consideration of whether the submitters of
the information had shown good cause for confidential treatment of the information in question".1079
In our view, the Panel's decision to base its conclusion with respect to Japan's claim under Article 6.5
on the information found on the Korean investigating authorities' published report and related
supporting documents is consistent with the legal standard under Article 6.5.
5.416. In sum, in articulating the legal standard under Article 6.5, the Panel did not pronounce on
the specific manner in which investigating authorities should specify that "good cause" was shown
when granting confidential treatment to certain information. Under Article 6.5, an investigating
authority is required to assess objectively whether the request for confidential treatment has been
sufficiently substantiated such that "good cause" has been shown. The fact that the investigating
authority has conducted this objective assessment must be discernible from its published report or

1070 See Panel Report, para. 7.435 (quoting Korea's response to Panel question No. 69).
1071 Panel Report, para. 7.436.
1072 Panel Report, para. 7.436.
1073 Panel Report, para. 7.441.
1074 Panel Report, para. 7.438.
1075 Appellate Body Report, EC – Fasteners (China), para. 539.
1076 Appellate Body Report, EC – Fasteners (China), para. 539.
1077 Korea's other appellant's submission, para. 332 (referring to Korea's first written submission to the
Panel, para. 337).
1078 Panel Report, para. 7.440. The Panel further noted that there was no evidence to suggest that "the
Korean Investigating Authorities themselves undertook to link the information for which confidential treatment
was sought to the categories defined in Korean legislation and thereby determine whether good cause for
confidential treatment existed." (Ibid.)
1079 Panel Report, para. 7.440.

related supporting documents. The Panel's articulation comports with the legal standard under
Article 6.5. Consequently, we find that the Panel did not err in its interpretation of Article 6.5 of the
Anti-Dumping Agreement.
5.417. Furthermore, with respect to the inves tigation at issue, the Panel stated that it could not
"conclude that the Korean Investigating Authorities actually engaged in a consideration of whether
the submitters of the information had shown good cause for confidential treatment of the information
in question".1080 Korea argues that, in providing non-confidential summaries by way of deleting the
relevant information from their submissions, the providers of the information "implicitly" asserted
that such deleted information fell within the categories of "confidential information" set forth in the
relevant Korean laws. In Korea's view, as a consequence of that "implicit" assertion, "good cause"
was "shown" for granting confidential treatment to that information. As noted, the Panel was not
convinced by this argument because there is no evidence on the record "linking the information for
which confidential treatment was granted to the categories of information warranting confidential
treatment identified in Korean law" .1081 Neither is there evidence suggesting that "the Korean
Investigating Authorities themselves undertook to link the information for which confidential
treatment was sought to the categories defined in Korean legislation and thereby determine whether
good cause for confidential treatment existed." 1082 Given these Panel findings, we disagree with
Korea's assertion that , "when [the] KTC received information that was considered confidential by
the interested parties, it objectively assessed whether there was indeed 'good cause' by confirming
whether the deleted information fell within a category of confidential information enumerated in the
relevant Korean laws." 1083 Consequently, we find that the Panel did not err in its application of
Article 6.5 of the Anti-Dumping Agreement.
5.418. For the foregoing reasons, we uphold the Panel's finding, in paragraphs 7.441, 7.451,
and 8.4.b of the Panel Report, that Japan demonstrated that the Korean investigating authorities
acted inconsistently with Article 6.5 of the Anti-Dumping Agreement with respect to their treatment
of information provided by the applicants as confidential without requiring that good cause be shown.
5.4.2.2 Article 6.5.1 of the Anti-Dumping Agreement
5.4.2.2.1 The Panel's findings
5.419. Before the Panel, Japan asserted that, with respect to certain documents, the KTC failed to
require that submitting parties provide a non -confidential summary of the information that was
treated as confidential or to show why such a summary could not be provided, as required under
Article 6.5.1 of the Anti-Dumping Agreement.1084
5.420. The Panel indicated that the issue before it under Article 6.5.1 was whether, with respect to
certain information, the KTC failed to require that the submitting parties provide a non-confidential
summary of information for which confidential treatment was sought. 1085 In this regard, Korea
argued before the Panel that the version of the applicants' submissions from which confidential
information was deleted constituted the non-confidential summary required by Article 6.5.1.1086
5.421. The Panel began by noting that the obligation in Article 6.5.1 falls on the investigating
authorities. Thus, the Panel emphasized that it is incumbent on the investigating authorities to

1080 Panel Report, para. 7.440.
1081 Panel Report, para. 7.440.
1082 Panel Report, para. 7.440.
1083 Korea's other appellant's submission, para. 332 (referring to Korea's first written submission to the
Panel, para. 337).
1084 Panel Report, para. 7.391.
1085 Panel Report, para. 7.427. The Panel further specified that, because the applicants did not argue
that the confidential information was not susceptible of summary, the question before it was only whether the
KTC failed to require that the applicants provide a non-confidential summary of the information for which
confidential treatment was sought, and not whether the KTC should have required a showing of why such
information was not susceptible of summary. (Ibid., para. 7.442)
1086 Panel Report, para. 7.442.

ensure that, when information is treated as confidential, a proper non -confidential summary is
provided by the party submitting the confidential information.1087
5.422. With respect to the underlying investigation, t he Panel noted that the "Disclosed" versions
of the three communications submitted by the applicants and identified by Japan (the investigation
application dated 23 December 2013, the summary of opinion from attorneys dated
23 October 2014, and the rebuttal opinion of applicants dated 13 November 2014) have entire
sections from which information wa s removed, without any narrative to summarize the specific
information deleted from the text. 1088 The Panel noted that the information redacted from the
submissions includes a significant amount of important data, such as information relating to the
production and sales of the domestic like product and various economic indicators regarding the
state of the domestic industry.1089
5.423. The Panel then addressed several arguments advanced by Korea. First, Korea argued that
Article 6.5.1 does not require a non -confidential summary to be provided for every piece of data
included in a submission. The Panel considered that, while there need not be a non -confidential
summary of, for instance, each individual data point reported in a table or chart, a non-confidential
summary of the information must nonetheless be provided. Second, the Panel disagreed with Korea's
argument that Japan did not claim due process violations or the lack of a sufficient opportunity for
the interested parties to defend their interests, finding instead t hat establishing a violation of
Article 6.5.1 does not require Japan to substantiate such claims. Finally, the Panel rejected Korea's
assertion that the KTC provided descriptive narratives of the information at issue subsequent to the
filing of the submiss ions, thereby ensuring a proper understanding of the substance of the
information. In the Panel's view, the subsequent provision of a non -confidential summary by the
investigating authority does not absolve it of having failed to comply with Article 6.5.1 in the first
instance.1090
5.424. The Panel did not exclude a priori that, in some circumstances, a redacted version of a
document from which the submitting party has deleted certain information may, in and of itself,
constitute the necessary non -confidential summar y of the information treated as confidential.
However, the Panel noted that, in the present case, "the documents in question contain entire
sections from which the data has been redacted"1091, without including any narrative that attempts
to summarize the redacted information. In the Panel's view, "[i]n the complete absence of data, and
with no narrative summary with respect to the deleted information, the 'Disclosed' versions of the
three communications identified by Japan cannot be said to contain a summary in sufficient detail
to 'permit a reasonable understanding of the substance of the information submitted in
confidence'."1092
5.425. On this basis, the Panel concluded that, "[b]y failing to require that the submitting parties
provide a sufficient non -confidential s ummary of the information in question, the Korean
Investigating Authorities acted inconsistently with Article 6.5.1 of the Anti-Dumping Agreement."1093
5.4.2.2.2 Whether the Panel erred in its application of Article 6.5.1 of the
Anti-Dumping Agreement
5.426. Korea submits that the Panel erred in its application of Article 6.5.1 by finding that the KTC
failed to require the applicants to furnish non -confidential summaries of the information submitted
in confidence. According to Korea, the non-confidential summaries submitted by the applicants were
in sufficient detail to permit a reasonable understanding of the substance of the confidential
information.1094 Korea maintains that the KTC's longstanding practice is to procure a non-confidential

1087 Panel Report, para. 7.444 (referring to Panel Report, EC – Fasteners (China), para. 7.515). The
Panel also observed that, "[w]hen information has been treated as confidential inconsistently with Article 6.5,
the issue of whether a proper non-confidential summary was provided becomes irrelevant." (Ibid., para. 7.443)
1088 Panel Report, paras. 7.445 and 7.449.
1089 Panel Report, para. 7.445.
1090 Panel Report, paras. 7.446-7.447 (referring to Korea's first written submission to the Panel,
paras. 346-348).
1091 Panel Report, para. 7.449.
1092 Panel Report, para. 7.449.
1093 Panel Report, para. 7.450.
1094 Korea's other appellant's submission, para. 349.

summary of the confidential information from the interested parties by way of requiring the "public
versions" of the submissions. According to Korea, in the "public versions" of the submissions from
the Korean producers that were "proactively disclosed" by the KTC 1095, "certain non -confidential
descriptive narratives are found with respect to all confidential information, and these narratives
permitted a reasonable understanding of the substance of the information and thus enabled
interested parties to defend their interests."1096
5.427. Japan responds that, contrary to Korea's assertion, the non -confidential summaries
submitted by interested parties did not contain sufficient detail to permit a reasonable understanding
of the substance of the confidential information. According to Japan, the "public versions" of the
documents at issue contained entire sections from which the key information had been redacted and
there was no narrative that attempted to summarize the redacted information. 1097 Therefore, in
Japan's view, the Panel correctly found that the KTC failed to require non-confidential summaries in
"sufficient detail" to convey the substance of the information.1098
5.428. Article 6.5.1 of the Anti -Dumping Agreement governs two related situations. First, this
provision sets out that "[t]he authorities shall require interested parties providing confidential
information to furnish non -confidential summaries thereof." With respect to the content of those
summaries, Article 6.5.1 elaborates that they "shall be in sufficient detail to permit a reasonable
understanding of the substance of the information submitted in confidence". Second, Article 6.5.1
further stipulates that "[i]n exceptional circumstances, such parties may indicate that such
information is not susceptible of summary. In such exceptional circu mstances, a statement of the
reasons why summarization is not possible must be provided."
5.429. In the present dispute, the Panel indicated that the claim at hand concerns only the first of
those situations, that is, whether the investigating authorities require d the submission of
non-confidential summaries that were in sufficient detail to permit a reasonable understanding of
the substance of the information submitted in confidence. Indeed, the Panel noted that, "[b]ecause
the applicants did not argue that the c onfidential information was not susceptible of summary, the
question before [it was] only whether the KTC failed to require that the applicants provide a
non-confidential summary of the information for which confidential treatment was sought, and not
whether the KTC should have required a showing of why such information was not susceptible of
summary."1099 On appeal, Korea does not dispute the Panel's understanding of the scope of the claim
under Article 6.5.1.1100
5.430. Thus, the central issue underlying Korea's claim on appeal is whether the Panel committed
legal error under Article 6.5.1 in finding that the Korean investigating authorities failed to require
that the parties submitting confidential information provide a "sufficient" non-confidential summary
of the information at issue. Indeed, on appeal, Korea's main argument is that the "KTC did not fail
to require the applicants to provide sufficient non -confidential summaries of the confidential
information" given that "[t]he non -confidential summaries were in suffi cient detail to permit a
reasonable understanding of the substance of the confidential information."1101
5.431. We note that, as found by the Panel, "the applicants filed 'Disclosed', or public, versions of
at least three of their written submissions (the investigation application dated 23 December 2013,

1095 Korea's other appellant's submission, para. 353.
1096 Korea's other appellant's submission, para. 352.
1097 Japan's appellee's submission, para. 174. Japan specifies that, in some cases, tables were provided
but all data contained therein was deleted; in other cases, percentage changes were shown but actual figures
were deleted. (Ibid. (referring to Panel Report, para. 7.449))
1099 Panel Report, para. 7.442.
1100 In its other appellant's submission, Korea states that "[t]here can certainly be situations when there
is no meaningful way of summarizing confidential data and, thus, the only option is to redact such information
in full (e.g. by indicating 'XXX')". (Korea's other appellant's submission, para. 350) While this statement might
suggest that Korea invokes "exceptional circumstances" pursuant to Article 6.5, Korea nonetheless clarified at
the oral hearing that its position is that the KTC provided non-confidential summaries of the confidential
information at issue by way of requiring "public versions" of the applicants' submissions. Thus, Korea agrees
that the claim at hand should be evaluated in light of the first situation covered by Article 6.5.1 and therefore
does not involve examining whether there were any "exceptional circumstances" in the underlying investigation
such that the information at issue was not susceptible of summary.
1101 Korea's other appellant's submission, para. 349.

the summary of opinion from attorneys dated 23 October 2014, and the rebuttal opinion of
applicants dated 13 November 2014) from which certain information was redacted either by totally
removing it or by replacing it with 'X' or asterisks."1102
5.432. Korea argued before the Panel that "the version of the applicants' submissions from which
confidential information was deleted constitutes the non -confidential summary required by
Article 6.5.1."1103 In this regard, the Panel stated that it did not "exclude a priori that in some
circumstances a redacted version of a document from which the submitting party has deleted certain
information may in itself constitute the necessary non-confidential summary of information treated
as confidential".1104 The Panel added that "[w]hether such a document satisfies the requirements in
Article 6.5.1, and specifically whether it is in sufficient detail to 'permit a reasonable understanding
of the substance of the informa tion submitted in confidence', is something that would have to be
determined on a case-by-case basis."1105 We agree with these statements by the Panel.
5.433. On appeal, Korea maintains that the three documents cited by Japan contain
"non-confidential descriptive na rratives … with respect to all confidential information", which
"permitted a reasonable understanding of the substance of the information and thus enabled
interested parties to defend their interests".1106 The Panel rejected this view. In particular, the Panel
noted that " the 'Disclosed' versions of the three communications identified by Japan have entire
sections from which information was removed."1107 The Panel added that "[t]he information redacted
from the submissions includes a significant amount of importa nt data."1108 By way of example, the
Panel noted that, "in some cases tables are provided from which all data was deleted; in other cases,
percentage changes are shown in the tables, but the actual figures were deleted. There are also
sections of text from wh ich data was redacted." 1109 The Panel also pointed out that "[t]here is no
narrative in the 'Disclosed' version to summarize the specific information deleted from the text."1110
The Panel noted that the information redacted from the submissions refers to, inter alia, the
following:
(a) volumes of domestic production of the like product, including percentages of the
domestic production represented by the complainants; (b) volumes of domestic
consumption; (c) market shares in the Korean domestic market; (d) import price of the
product under investigation; (e) production capacity and utilization by the domestic
industry; (f) domestic sales; (g) inventories [,] volumes[,] and ratio for the domestic
industry; (h) profitability for the domestic industry; (i) production costs for the domestic
industry; (j) investments in equipment and research and development by the domestic
industry; (k) employment and wages in the domestic industry; (l) productivity in the
domestic industry; (m) cash flow for the domestic industry; (n) prices of raw materials;
(o) quantity and value of imports of the product under investigation; and (p) production
capacity and utilization by the Japanese industry.1111
5.434. In light of the above considerations, the Panel found that, "[i]n the complete absence of
data, and with no narrative summary with respect to the deleted information, the 'Disclosed' versions
of the three communications identified by Japan cannot be said to contain a summary in sufficient
detail to 'permit a reasonable understanding of the subst ance of the information submitted in
confidence'."1112
5.435. In the above passages from the Panel Report, the Panel made findings of fact with respect
to the content of the documents that were treated as the "non -confidential summaries" in the
underlying investigation. In particular, t he Panel pointed out that "the 'Disclosed' versions of the

1102 Panel Report, para. 7.431.
1103 Panel Report, para. 7.442 (referring to Korea's first written submission to the Panel,
paras. 341-343; response to Panel question No. 65(a)). (emphasis added)
1104 Panel Report, para. 7.448.
1105 Panel Report, para. 7.448 (referring to Korea's response to Panel question No. 68).
1106 Korea's other appellant's submission, para. 352.
1107 Panel Report, para. 7.445.
1108 Panel Report, para. 7.445.
1110 Panel Report, para. 7.445.
1111 Panel Report, para. 7.445.

three communications identified by Japan have entire sections from which information was
removed"1113, which cover "a significant amount of important data". 1114 The Panel also highlighted
that "[t]here is no narrative in the 'Disclosed' version to summarize the specific information deleted
from the text."1115 Korea does not challenge the Panel's appreciation of the facts under Article 11 of
the DSU. Instead, Korea repeats certa in arguments that the Panel had already rejected without
explaining why the Panel's analysis constitutes a misapplication of Article 6.5.1. We recall that
Article 6.5.1 mandates the investigating authority to require a non -confidential summary that
contains "sufficient detail to permit a reasonable understanding of the substance of the information
submitted in confidence".1116 In light of the applicable legal standard and the reasoning provided by
the Panel, we fail to see how the "non -confidential summaries" at issue could satisfy the legal
standard of being "in sufficient detail to permit a reasonable understanding of the substance of the
information submitted in confidence". In these circumstances, we disagree with Korea's argument
that "[the] KTC did not fail to require the applicants to provide sufficient non-confidential summaries
of the confidential information."1117
5.436. Korea further argues on appeal that "non -confidential summaries are not required under
Article 6.5.1 for every single figure and piece of data included in the parties' submissions, regardless
of the relevant context." 1118 This argument was also addressed by the Panel.1119 The Panel stated
that while "all confidential information must be summarized … this does not mean that there must
be a non -confidential summary of, for instance, each individual data point reported in a table or
chart."1120 As we see it, the Panel did not fault Korea under Article 6.5.1 for failing to disclose
individual data points. Instead, as noted above, the Panel's conclusion was bas ed on the fact that
the "non-confidential summaries" did not meet the legal standard under Article 6.5.1 because there
was a "complete absence of data" and "no narrative summary with respect to the deleted
information".1121 We are therefore not convinced by Korea's argument.
5.437. Korea additionally submits that "Article 6.5.1 does not provide any instruction on the method
and extent of preparing non-confidential summaries. Thus, investigating authorities are entitled [to]
certain deference to a reasonable degree in accepting or rejecting non-confidential summaries."1122
In our view, regardless of the degree of deference that an investigating authority may enjoy under
Article 6.5.1, it must comply with the obligation to require summaries that are "in suffi cient detail
to permit a reasonable understanding of the information submitted in confidence". Our above
analysis shows that the Panel correctly found that the "non -confidential summaries" at issue failed
to meet this legal standard. Therefore, we fail to see anything in this argument by Korea that would
disturb the Panel's conclusion.
5.438. Korea also contends that there was neither a violation of due process rights of the interested
parties nor a failure to provide interested parties with an opportunity to defe nd their interests. In
Korea's view, "[i]t is noteworthy that there were no such claims put forward by Japan under
Article 6.2 or 6.4 of the Anti-Dumping Agreement."1123 This argument by Korea was also rejected by
the Panel.1124 For the Panel, "if an investigati ng authority fails to ensure that a non -confidential

1113 Panel Report, para. 7.445.
1114 Panel Report, para. 7.445.
1115 Panel Report, para. 7.445.
1116 Appellate Body Report, EC – Fasteners (China), para. 542. Article 6.5.1 also contemplates that in
"exceptional circumstances" confidential information may not be "susceptible of summary". The Appellate Body
observed in EC – Fasteners (China) that, "[i]n such exceptional circumstances, a party may indicate that it is
not able to furnish a non-confidential summary of the information submitted in confidence, but it is
nevertheless required to provide a 'statement of the reasons why summarization is not possible'." (Ibid.,
para. 543)
1117 Korea's other appellant's submission, para. 349.
1118 Korea's other appellant's submission, para. 352.
1119 Before the Panel, Korea argued that "Article 6.5.1 does not require that a non-confidential summary
must be provided for every piece of data included in a submission." (Panel Report, para. 7.446 (referring to
Korea's first written submission to the Panel, para. 346))
1120 Panel Report, para. 7.447.
1121 Panel Report, para. 7.449.
1122 Korea's other appellant's submission, para. 352.
1123 Korea's other appellant's submission, para. 353.
1124 Korea asserted that "Japan [was] not claiming that the due process rights of interested parties were
violated or that interested parties did not have a sufficient opportunity to defend their interests."
(Panel Report, para. 7.446 (referring to Korea's first written submission to the Panel, para. 347))

summary is submitted, there is no requirement under Article 6.5.1 for a complainant before the WTO
to demonstrate that the due process rights of interested parties were violated or that interested
parties did not have a sufficient opportunity to defend their interests, in order to establish a
violation."1125
5.439. We consider the Panel's reasoning to be in line with the role of due process concerns when
assessing claims under Article 6.5.1. Indeed, in describing t he legal standard under Article 6.5.1,
the Appellate Body stated in EC – Fasteners (China) that, "[w]henever information is treated as
confidential, transparency and due process concerns will necessarily arise because such treatment
entails the withholding of information from other parties to an investigation."1126 Thus, as we see it,
the Appellate Body has rejected the view that a panel's inquiry into whether Article 6.5.1 has been
breached includes a separate analysis of whether the parties' due process rights have been violated.
The Panel was therefore correct in rejecting Korea's argument about the relevance of conducting a
separate assessment as to whether the due process rights of the interested parties had been violated
in order to establish a claim under Article 6.5.1.
5.440. Finally, Korea contends that " throughout the underlying investigation, [the] KTC analyzed
and proactively disclosed the non-confidential summaries of the confidential information submitted
by the interested parties."1127 Before the Panel, Korea had similarly argued that " the KTC provided
descriptive narratives with respect to all of the information that Japan identified in its
communications subsequent to the filing of the submissions, thereby e nsuring a proper
understanding of the substance of the information."1128 As in previous instances, the Panel disagreed
with Korea. According to the Panel, "even assuming that the Korean Investigating Authorities
subsequently provided descriptive narratives of the information treated as confidential, this would
not resolve the issue of whether they required the submission of a non -confidential summary from
the submitter of the information for which confidential treatment was sought. The subsequent
provision of a non-confidential summary by the investigating authority does not absolve it of having
failed to comply with Article 6.5.1 in the first instance."1129
5.441. In our view, the Panel's reasoning for rejecting Korea's argument is supported by the text
of Article of 6.5.1 and relevant Appellate Body jurisprudence. This provision imposes an obligation
on investigating authorities with respect to the conduct expected of parties seeking to obtain
confidential treatment for certain information, namely "[t]he authorities sha ll require" interested
parties "to furnish non -confidential summaries" of the relevant information. Thus, under
Article 6.5.1, the authorities bear the obligation to require non -confidential summaries from the
parties, and there appears to be no basis for the proposition that the authorities' obligation could be
fulfilled through summaries provided by the authorities themselves. Consequently, we see no error
in the Panel's statement that the subsequent issuance of descriptive narratives of the information
treated as confidential by the KTC "would not resolve the issue of whether they required the
submission of a non -confidential summary from the submitter of the information for which
confidential treatment was sought".1130
5.442. In sum, Article 6.5.1 mandates investi gating authorities to require non -confidential
summaries from interested parties providing confidential information. These summaries shall be in
sufficient detail to permit a reasonable understanding of the substance of the information submitted
in confidence. In the present dispute, the Panel found that, "[i]n the complete absence of data, and
with no narrative summary with respect to the deleted information, the 'Disclosed' versions of the
three communications identified by Japan cannot be said to contain a summary in sufficient detail
to 'permit a reasonable understanding of the substance of the information submitted in
confidence'."1131 Korea does not challenge the Panel's appreciation of the facts under Article 11 of
the DSU leading to the above finding. Instead, Korea repeats certain arguments that the Panel had
already rejected without explaining why the Panel's analy sis constitutes a misapplication of
Article 6.5.1. In light of the applicable legal standard and the reasoning provided by the Panel, we

1125 Panel Report, para. 7.447.
1126 Appellate Body Report, EC – Fasteners (China), para. 541. (emphasis added)
1127 Korea's other appellant's submission, para. 353.
1128 Panel Report, para. 7.446 (referring to Korea's first written submission to the Panel,
paras. 346-348).
1129 Panel Report, para. 7.447.

fail to see how the versions of the submissions from which confidential information had been
redacted could satisfy the legal standard of being non-confidential summaries that are "in sufficient
detail to permit a reasonable understanding of the substance of the information submitted in
confidence". In these circumstances, we disagree with Korea's argument that "[the] KTC did not fail
to require the applicants to provide sufficient non -confidential summaries of the confidential
information."1132
5.443. For the foregoing reasons, we uphold the Panel's finding, in paragraphs 7.450, 7.451,
and 8.4.c of the Panel Report, that Japan demon strated that the Korean investigating authorities
acted inconsistently with Article 6.5.1 of the Anti-Dumping Agreement by failing to require that the
submitting parties provide a sufficient non -confidential summary of the information for which
confidential treatment was sought.
5.5 Essential facts
5.444. The Panel found that Japan's claim 10 as listed in its panel request, which concerns the
disclosure of essential facts, did not meet the requirements of Article 6.2 of the DSU and,
consequently, was not within its terms of reference.1133
5.445. Japan appeals this finding and requests the Appellate Body to find that this claim is within
the Panel's terms of reference. In addition, Japan requests the Appellate Body to complete the legal
analysis and find that the Korean investigating authorities acted inconsistently with Article 6.9 of the
Anti-Dumping Agreement by failing to inform the interested parties of the 14 essential facts relating
to price effects, the volume of dumped imports, the state of the domestic industry, and causation.1134
5.446. Korea, for its part, requests the Appellate Body to uphold the Panel's finding under Article 6.2
of the DSU. Should the Appellate Body reverse the Panel's finding, Korea argues that the
Appellate Body cannot complete the legal analysis.1135
5.447. We begin by examining whether the Panel erred under Article 6.2 of the DSU in finding that
Japan's claim 10, concerning the disclosure of essential facts, was not within its terms of reference.
If we reverse the Panel's findings under Article 6.2 of the DSU and find that Japan's claim concerning
the disclosure of essential facts was within the Panel's terms of reference, we will proceed to examine
whether the Appellate Body can complete the legal analysis with respect to Japan's claim that the
Korean investigating authorities acted inco nsistently with Article 6.9 of the
Anti-Dumping Agreement.
5.5.1 Whether the Panel erred in finding that Japan's claim 10 concerning the disclosure
of essential facts was not within its terms of reference
5.448. In its panel request, Japan claimed that the Korean measures are inconsistent with Korea's
obligations under:
Article 6.9 of the [Anti-Dumping] Agreement because Korea failed to inform the
interested parties of the essential facts under consideration which formed the basis for
the decision to impose definitive anti-dumping measures[.]
5.449. The Panel found that Japan's panel request merely paraphrased the language of Article 6.9
and did not identify the essential facts allegedly not disclosed or set out any elements that would
allow the respondent or other Members to have any understanding of the scope of the claim. To the
Panel, a mere paraphrase of the language of Article 6.9 is insufficient to explain how or why Japan
considers the obligation was breached.1136 In the Panel's view, some additional narrative regarding
the kinds of essential facts allegedly not disclosed should have been included in the panel request
so as to present the problem clearly. 1137 The Panel found support for its conclusion by taking into

1132 Korea's other appellant's submission, para. 349.
1133 Panel Report, para. 7.517.
1134 Japan's appellant's submission, paras. 326 and 347.
1135 Korea's appellee's submission, para. 464.
1136 Panel Report, para. 7.514.
1137 Panel Report, para. 7.515.

account the "broad and diverse scope of the allegations" conta ined in Japan's submissions.1138 The
Panel thus concluded that Japan's claim under Article 6.9 of the Anti-Dumping Agreement concerning
the disclosure of essential facts was not properly within the Panel's terms of reference, and the Panel
declined to consider it further or resolve it.1139
5.450. On appeal, Japan argues that claim 10 of its panel request refers specifically to the failure
to disclose essential facts and expressly identifies Article 6.9 as the provision at issue.1140 However,
the Panel failed to cons ider fully and carefully the "nature and scope" of this obligation, and failed
to consider the claim in light of the nature of the specific measure being challenged. 1141 Japan
submits that the obligation to disclose essential facts is narrow and well defined on its face. Thus,
the nature of the obligation in these circumstances is "sufficient to present the problem clearly".1142
Japan further argues that the Panel failed to consider the nature of the measure, in particular the
fact that its claim refers specifically to Korea's failure to "inform the interested parties of the essential
facts under consideration".1143 Japan finally submits that the Panel improperly relied on the phrase
"how or why" to require the complainant to provide arguments in support of the claim 1144, and
incorrectly relied on its later arguments to support its finding that claim 10 of the panel request does
not comply with the requirements of Article 6.2.1145
5.451. Korea replies that the Panel correctly found that Japan's panel request does not explain how
or why Japan considers that the Korean investigating authorities failed to inform interested parties
of the essential facts that formed the basis for the decision to impose anti -dumping measures.1146
To Korea, it is clear that the lack of clarity in Japan's panel request prejudiced the preparation of
Korea's defe nce and violated Korea's essential due process rights in this proceeding. 1147 Korea
argues that the Panel did not fail to consider the nature of the obligation 1148 or the nature of the
measure. Instead, the Panel considered that an anti -dumping measure could violate Article 6.9 in
many different ways and thus that it was important for Japan to provide the how and why of the
specific allegations of violation.1149 Korea further contends that the Panel was aware of the distinction
between claims and arguments 1150, and did not improperly rely on later arguments because the
Panel first made its determination on the basis of the panel request, on its face, before turning to
the later submissions for confirmation.1151
5.452. We have indicated in section 5.1.1 above that , in assessing whether a panel request
comports with the requirements of Article 6.2 of the DSU, a panel must examine a panel request on
its face, taking into consideration the circumstances of each case. We have also explained that, in
order to provide the legal basis of the complaint sufficient to present the problem clearly, a panel
request must plainly connect the challenged measure with the obligation alleged to have been
breached. In this regard, a complainant must, as a minimum requirement, list the provisions of the
covered agreement alleged to have been breached. However, there may be situations in which
identification of these provisions, in and of itself, may fall short of meeting the legal standard under
Article 6.2 of the DSU, for example, where the provision at issue establishes multiple obligations.1152
5.453. In the present instance, the Panel nonetheless considered that "[a] mere paraphrase of the
language of Article 6.9 does not explain how or why Japan considers the measures at issue to be
inconsistent with" this provision. 1153 Beyond this conclusion, the Panel did not provide any further
analysis on the circumstances of this case, such as the nature of the measure or that of the provision

1138 Panel Report, para. 7.516.
1139 Panel Report, para. 7.517.
1140 Japan's appellant's submission, para. 314.
1141 Japan's appellant's submission, para. 315.
1142 Japan's appellant's submission, para. 316.
1143 Japan's appellant's submission, para. 320.
1144 Japan's appellant's submission, para. 324.
1145 Japan's appellant's submission, paras. 325-326.
1146 Korea's appellee's submission, para. 474.
1147 Korea's appellee's submission, para. 475.
1148 Korea's appellee's submission, paras. 478-479.
1149 Korea's appellee's submission, para. 482.
1150 Korea's appellee's submission, paras. 485-486.
1151 Korea's appellee's submission, para. 492.
1152 See para. 5.6 above.

at issue. However, wh ether Japan's claim 10, despite its brevity, fulfils the requirements of
Article 6.2 of the DSU should be assessed, taking into consideration these circumstances.
5.454. With regard to the nature of the measure, we observe that Japan's claim 10 specifically
refers to the Korean investigating authorities' failure "to inform the interested parties of the essential
facts under consideration which formed the basis for the decision to impose definitive anti-dumping
measures". Claim 10, therefore, expressly relates to the alleged omission to disclose essential facts
by the Korean investigating authorities in the anti-dumping investigation at issue.
5.455. With regard to the nature of the provisions concerned, Article 6.9 of the
Anti-Dumping Agreement provides that:
The authorities shall, before a final determination is made, inform all interested parties
of the essential facts under consideration which form the basis for the decision whether
to apply definitive measures. Such disclosure should take place in sufficient time for the
parties to defend their interests.
5.456. Article 6.9 thus concerns the disclosure of "essential facts" before a final determination is
made, namely those facts that are significant in the process of reaching a decision whether to apply
definitive measures. 1154 Therefore, the obligation contained in Article 6.9 is distinct and well
delineated. It essentially requires the investigating authority to disclose the essential facts to all
interested parties in a timely manner, that is, before the final determination is made and in sufficient
time for the parties to defend their interests. Thus, by identifying the specific aspect of the measure
at issue under this claim with the degree of precision highlighted above, and by referring to
Article 6.9 of the Anti-Dumping Agreement, Japan's claim 10 has plainly connected the challenged
measure with the provision alleged to have been breached such that the panel request meets the
requirements of Article 6.2 of the DSU.
5.457. We recall, however, that in finding that the panel request was not sufficiently precise to
comply with the requirements of Article 6.2 of the DSU, the Panel relied on the following allegations
in Japan's written submissions that the KTC failed to disclose the essential facts under consideration
with respect to:
a. price effects, specifically: the alleged practices of aggressive marketing, the construction
of the "reasonable sales price", the interchangeability of the dumped imports and the
domestic industry's like product, including with respect to the importance of "system sales"
in this regard;
b. the volume of dumped imports, specifically: the actual volumes and market shares of the
dumped imports, the volume of the dumped imports relative to domestic production, and
the end-point to end-point comparison of the volume of the dumped imports;
c. the condition of the domestic industry, specifically: capacity utilization, market share, and
the profitability of the domestic industry; and
d. causation, specifically: facts relating to any causal relationship and facts relating to other
known factors having an impact on the state of the domestic industry such as third
countries' imports and the export performance of the domestic industry.1155
5.458. In our view, these allegations indicate which essential facts, or which categories of essential
facts, Japan contended that the Korean investigating authorities failed to disclose. The Panel
therefore appears to have understood that, to comply with the req uirements of Article 6.2 of the
DSU, when bringing a claim under Article 6.9 of the Anti -Dumping Agreement, a complainant is
required to indicate in its panel request which essential facts, or categories thereof, have not been
disclosed by the investigating authority.

1154 Appellate Body Report, Russia – Commercial Vehicles, para. 5.177. The Appellate Body has further
indicated that "[s]uch facts are those that are salient for a decision to apply definitive measures as well as
those that are salient for a contrary outcome." (Ibid.)
1155 Panel Report, para. 7.516.

5.459. As indicated above, however, the identification of Article 6.9 in the panel request, together
with the identification of the specific aspect of the measure at issue, was sufficient to provide a brief
summary of the legal basis of the complain t for purposes of Article 6.2 of the DSU. Requiring the
panel request to include the kind of additional detail suggested by the Panel – such as the specific
essential facts allegedly not disclosed – would entail the elaboration of the arguments underlying
Japan's claim, which would, in our view, exceed the requirements to which the complainant is held
under Article 6.2 of the DSU.
5.460. Moreover, we also disagree with Korea's argument that Japan "failed to satisfy even the
basic obligation of providing any narrative that presented the problem clearly".1156 In Korea's view,
although Japan was not required to "set forth the factual and legal reasons and evidence supporting
its claim", Japan must "explain the 'how or why' of its legal claims" such that its panel request could
"provide[] a narrative to present the problem clearly". 1157 However, we fail to see the difference
between the "factual and legal reasons" supporting the claim, which Korea agrees are not required
in the panel request, and the explanation of the "how or why" that Korea maintains should have
been included in the panel request. In our view, by plainly connecting the measure at issue with the
obligations alleged to have been breached, Japan's panel request provide s a brief summary of the
legal basis as required by Article 6.2 of the DSU.
5.461. In sum, Japan's claim 10 concerning the disclosure of essential facts in its panel request
identifies Article 6.9 of the Anti-Dumping Agreement as the provision alleged to have been breached
by Korea. Claim 10 also specifically refers to the Korean investigating authorities' failure "to inform
the interested parties of the essential facts under consideration which formed the basis for the
decision to impose definitive anti -dumping measures". In addition, Article 6.9 sets forth a distinct
and well-delineated obligation requiring the investigating authority to disclose the essential facts to
all interested parties in a timely manner, that is, before the final determination is made and in
sufficient time for the parties to defend their interest s. Thus, Japan's claim 10 "provide[s] a brief
summary of the legal basis of the complaint sufficient to present the problem clearly" within the
meaning of Article 6.2 of the DSU.
5.462. For the foregoing reasons, we find that the Panel err ed in finding that Japan's claim 10
concerning the disclosure of essential facts was not within its terms of reference. Consequently,
we reverse the Panel's finding , in paragraphs 7.517 and 8.1.f of the Panel Report, and find that
Japan's claim 10 is within the Panel's terms of reference.
5.5.2 Whether the Appellate Body can complete the legal analysis under Article 6.9 of the
Anti-Dumping Agreement
5.463. Having reversed the Panel's finding that Japan's claim under Article 6.9 of the
Anti-Dumping Agreement is outside the Panel's terms of reference, we turn to Japan's request for
completion of the legal analysis under this provision.
5.464. Japan requests us to complete the legal analysis and find that Korea acted inconsistently
with Article 6.9 of the Anti -Dumping Agreement due to the KTC's failure to disclose the "essential
facts" before its "final determination".1158 Japan maintains that the KTC violated Article 6.9 because
of the inadequate manner in which it disclosed certain information to the Japanese respondents. For
Japan, "[s]ome of the failures were not to disclose any information at all, even though the KTC would
ultimately rely on that undisclosed information to make key findings. Some other failures were to
provide no adequate public summary of cert ain information, which essentially left the parties with
no disclosure." 1159 Japan maintains that, "[f]or both categories the KTC deprived the Japanese
respondents of the opportunity to defend their interests."1160

1156 Korea's appellee's submission, para. 488.
1157 Korea's appellee's submission, para. 487. (emphasis original)
1158 Japan's appellant's submission, para. 347.
1159 Japan's appellant's submission, para. 334.
1160 Japan's appellant's submission, para. 334.

5.465. In Japan's view, the KTC failed to disclose adequately the "essential facts" in the following
"key disclosure documents": the OTI's Preliminary Report 1161, the KTC's Preliminary Resolution1162,
and the OTI's Interim Report1163. According to Japan, the Korean investigating authorities failed to
disclose the following "essential facts", which are grouped into four main themes:
• [With respect to price effects]: (1) the alleged "aggressive marketing", (2) the
construction of the "reasonable sales price", (3) the treatment of "system
sales", and (4) the interchangeability of the dumped imports and the domestic
industry's like product;
• [With respect to volume of dumped imports ]: (5) the actual volumes of [the]
dumped imports, (6) the market shares of the dumped imports, (7) the volume
of the dumped imports relative to d omestic production, and (8) the end -point
to end-point comparison of the volume of the dumped imports;
• [With respect to the state of the domestic industry ]: (9) capacity utilization of
the domestic industry, (10) market share of the domestic industry, and (11)
the profitability of the domestic industry; and[]
• [With respect to causation ]: (12) facts relating to any causal relationship,
(13) facts relating to other known factors having an impact on the state of the
domestic industry such as third countries' imports, and (14) similar facts about
the export performance of the domestic industry.1164
5.466. Japan argues that, on the basis of the "relevant facts" set out by the Panel, "there is no
dispute about the contents of the key disclosure documents: the OTI's Prelimin ary Report
dated 26 June 2014, the KTC's Preliminary Resolution also dated 26 June 2014, and the OTI's
Interim Report dated 23 October 2014."1165 In Japan's view, "[t]he only dispute is the legal issue of
whether the KTC Final Resolution constitutes a 'final determination' of injury for purposes of
Article 6.9"1166, or whether it constitutes a disclosure document.
5.467. Korea responds that there is no basis for the Appellate Body to complete the legal analysis,
given that it can do so only in a situation where there are sufficient factual findings by the Panel or
undisputed facts on the Panel record.1167 Korea recalls that, in the section of the Panel Report entitled
"Relevant facts", the Panel summarized a number of factual findings made by the Korean
investigating authorities at different stages of the underlying investigation. However, "[t]his section
does not contain any legal or factual findings by the Panel on which are the 'essential facts' and
which were the relevant documents to be examined for purposes of Article 6.9."1168
5.468. Korea disagrees with Japan's statement that "the status of the KTC Final Resolution is 'a
legal issue, not a factual issue'."1169 Korea considers that the final disclosure took place in the OTI's
Final Report and the KTC's Final Resolution, and that the final decision to adopt measures was taken
only later by the MOSF. In Korea's view, while the question whether these final documents by the
OTI and the KTC disclosed the "essential facts" within the meaning of Article 6.9 may well be a legal
issue, the issue whether these documents were the relevant documents to consider for purposes of
Article 6.9 is a factual matter on which the Panel did not express a view and is disputed between the
parties.1170 For these reasons, Korea argues that the Appellate Body should reject Japan's request
for the completion of the legal analysis.

1161 OTI's Preliminary Report (Panel Exhibit JPN-2b).
1162 KTC's Preliminary Resolution (Panel Exhibit JPN-1b).
1163 OTI's Interim Report (Panel Exhibit JPN-3b).
1164 Japan's appellant's submission, para. 334. (fns omitted)
1165 Japan's appellant's submission, para. 328. (fns omitted)
1166 Japan's appellant's submission, para. 329.
1167 Korea's appellee's submission, para. 496 (referring to Appellate Body Report, US – Anti-Dumping
1168 Korea's appellee's submission, para. 497. Korea adds that the Panel did not make any finding on
which document under domestic law is the appropriate one for purposes of this examination. (Ibid.)
1169 Korea's appellee's submission, para. 498 (quoting Japan's appellant's submission, para. 329).
1170 Korea's appellee's submission, para. 498.

5.469. Article 6.9 of the Anti-Dumping Agreement reads:
The authorities shall, before a final determination is made, inform all interested parties
of the essential facts under consideration which form the basis for the decision whether
to apply definitive measures. Such disclosure should take place in sufficient time for the
parties to defend their interests.
5.470. The Appellate Body noted in China – GOES that Article 6.9 sets out "the require ment to
disclose, before a final determination is made, the essential facts under consideration which form
the basis for the decision whether or not to apply definitive measures". 1171 Disclosing the essential
facts under consideration "is paramount for ensuri ng the ability of the parties concerned to defend
their interests". 1172 The Appellate Body also observed that, unlike Article 12.2.2 of the
Anti-Dumping Agreement, which governs the disclosure of matters of fact and law and reasons at
the conclusion of anti -dumping and countervailing duty investigations, Article 6.9 "concern[s] the
disclosure of 'facts' in the course of such investigations 'before a final determination is made' ."1173
As to what type of facts are "essential" under Article 6.9, the Appellate Body has stated that
"essential facts" refer to those facts under consideration that "are significant in the process of
reaching a decision as to whether or not to apply definitive measures".1174
5.471. With respect to the temporal aspect of the obligation under Article 6.9, the investigating
authorities must disclose the essential facts under consideration "before a final determination is
made" and "in sufficient time for the parties to defend their interests". Moreover, the Appellate Body
held in China – HP-SSST (Japan) / China – HP-SSST (EU) that an investigating authority must
disclose the essential facts "in a coherent way" that permits an interested party to understand the
factual basis for each of the intermediate findings and conclusions reached by the autho rity, such
that it is able properly to defend its interests.1175
5.472. In light of these considerations, compliance with Article 6.9 should be assessed on the basis
of an investigating authority's conduct "before a final determination is made". Thus, in the present
case, the application of the legal standard requires determining, first, which is the "final
determination" in the underlying investigation and, second, whether prior to such "final
determination" the Korean investigating authorities properly disclosed th e "essential facts" under
consideration in accordance with Article 6.9.
5.473. In order to situate Japan's claim under Article 6.9, we begin by providing relevant
background regarding the timeline of the underlying investigation in the present dispute. The
investigation at issue was initiated by the KTC based on an application filed by TPC and KCC on
23 December 2013.1176 On 26 June 2014, the OTI issued a Preliminary Report on dumping and injury
to the domestic industry of valves for pneumatic transmission from Japan .1177 On the same date,
the KTC issued a Preliminary Resolution on dumping and injury to the domestic industry of valves
for pneumatic transmission from Japan.1178 On 23 October 2014, the OTI issued an Interim Report
on dumping and injury of valves for pneumatic transmission from Japan.1179 On 20 January 2015,

1171 Appellate Body Report, China – GOES, para. 240. (emphasis original)
1172 Appellate Body Report, China – GOES, para. 240.
1173 Appellate Body Report, China – GOES, para. 240. See also Appellate Body Report,
Russia – Commercial Vehicles, para. 5.177.
1174 Appellate Body Report, China – GOES, para. 240. The Appellate Body has similarly indicated that
Article 6.9 "cover[s] 'facts under consideration', that is, those facts on the record that may be taken into
account by an authority in reaching a decision as to whether or not to apply definitive anti-dumping … duties".
(Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.129 (quoting
Appellate Body Report, China – GOES, para. 240))
1175 Appellate Body Reports, China – HP-SSST (Japan) / China – HP-SSST (EU), para. 5.130. See also
Appellate Body Report, China – GOES, para. 240.
1176 Panel Report, para. 2.2 (referring to KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)), p. 2; OTI's
Final Report (Panel Exhibit KOR-2b (BCI)), p. 1).
1177 See Panel Report, fn 15 to para. 2.3 (referring to OTI's Preliminary Report (Panel Exhibit JPN-2b)).
1178 Panel Report, para. 2.3 (referring to KTC's Preliminary Resolution (Panel Exhibit JPN-1b)). In its
Preliminary Resolution, the KTC determined that there was sufficient evidence to presume the existence of
dumping and of material injury to the domestic industry caused by the dumped imports. The KTC did not
recommend the imposition of provisional anti-dumping duties. In turn, the MOSF did not impose provisional
anti-dumping duties. (Ibid.)
1179 Panel Report, para. 2.3 (referring to OTI's Interim Report (Panel Exhibit JPN-3b)).

based on the OTI's Final Report of the same date, the KTC issued the Final Resolution determining
that the Korean domestic industry producing the like product was materially injured by reason of
the dumping of pneumatic valves from Japan and recommending the imposition of anti -dumping
duties.1180 The Panel observed that "[t]he full non -confidential texts of OTI's Final Report and the
KTC's Final Resolution were notified to domestic producers, importers, and consum ers on
17 March 2015."1181
5.474. On 12 June 2015, the MOSF issued a Public Notice of Proposal Draft Rules on the Imposition
of Anti-Dumping Duties on Valves for Pneumatic Transmissions Originating from Japan.1182 The Panel
noted that "Japanese respondents subsequently filed an Opinion before MOSF on the Proposal."1183
On 5 August 2015, the KTC filed an opinion with the MOSF addressing the arguments advanced by
the Japanese respondents.1184 Finally, "[r]elying on the KTC's Final Resolution, on 19 August 2015
the MOSF adopted Decree No. 498, entitled 'Regulation Concerning the Imposition of Antidumping
Duty on Valves for Pneumatic Transmissions Originating from Japan', which imposes anti -dumping
duties for five years on the imports of pneumatic valves from Japan at the rates re commended in
the KTC's Final Resolution."1185
5.475. We recall that the Appellate Body may complete the legal analysis with a view to facilitating
the prompt settlement and effective resolution of the dispute when the factual findings by the
panel1186 and/or uncontested facts on the panel record1187 provide a sufficient factual basis for doing
so.1188 The Appellate Body has therefore been unable to complete the legal analysis where there
have been insufficient factual findings in the panel report and a lack of undisputed facts on the panel
record. Other reasons that have prevented the Appellate Body from completing the legal analysis
include the absence of a full exploration of the issues before the panel1189 and related considerations
pertaining to the parties' due process rights.1190
5.476. In the present case, the participants disagree on which documents issued by the Korean
investigating authorities constitute the "final determination" and which are the "disclosure"
documents. On the one hand, Japan asserts that the "KTC's Final Resolution dated 20 January 2015
constituted the 'final determination' for purposes of Article 6.9, as it encompassed the conclusion of
the investigation of dumping and injury ."1191 Regarding the "disclosure" of essential facts, Japan
argues that this was made in th e following three documents issued prior to the KTC's Final
Resolution: (i) OTI's Preliminary Report dated 26 June 2014; (ii) KTC's Preliminary Resolution

1180 Panel Report, para. 2.4 (referring to KTC's Final Resolution (Panel Exhibit KOR-1b), p. 1).
1181 Panel Report, para. 7.466 (referring to Notification of Final Determination on Dumping and Injury to
Domestic Industry of Valves for Pneumatic Transmissions from Japan (Panel Exhibit JPN-29b)).
1182 Panel Report, para. 7.467 (referring to MOSF, Public Notice 2015-105).
1183 Panel Report, para. 7.467 (referring to the Respondents' Opinion on the Pre-Announcement of
Legislation of the Rule (Draft) on Imposition of Anti-Dumping Duties on Valves for Pneumatic Transmissions
from Japan (Panel Exhibit KOR-37b)). The Panel also observed that the Japanese respondents requested the
MOSF not to impose anti-dumping duties, and that they advanced substantive objections to the KTC's findings
with respect to various issues, such as: (a) the substitutability of the products at issue; (b) the scope of the
domestic industry; (c) the consideration of the increase in dumped imports; (d) the effect of the dumped
products on the price of the like product; (e) the consideration of other indicators pertaining to the domestic
industry; and (f) the assessment of other factors affecting the domestic industry. (Ibid.)
1184 Panel Report, para. 7.467 (referring to Opinion after Reviewing the Respondents' Opinion on the
Public Notice of the (Proposal Pratt) Rules on Imposition of Anti-Dumping Duties (Panel Exhibit KOR-38b)).
1185 Panel Report, para. 7.467 (referring to MOSF's Decree No. 498 (Panel Exhibit JPN-6b); MOSF's
Public Announcement (Panel Exhibit KOR-3b) (BCI)).
1186 See e.g. Appellate Body Reports, US – Gasoline, p. 19, DSR 1996:I, pp. 18-19;
Canada – Periodicals, p. 24, DSR 1997:I, p. 469; Australia – Salmon, paras. 117-119.
1187 See e.g. Appellate Body Reports, US – Lamb, paras. 150 and 172; US – Shrimp, paras. 123-124,
132, and 140; US – Section 211 Appropriations Act, paras. 343-345; EC and certain member States – Large
Civil Aircraft, paras. 1174-1177; US – Large Civil Aircraft (2nd complaint), para. 1262.
1188 See also Appellate Body Reports, Colombia – Textiles, para. 5.30; US – Anti-Dumping Methodologies
(China), para. 5.146; Russia – Pigs (EU), para. 5.141; EC and certain member States – Large Civil Aircraft,
para. 1178; EC and certain member States – Large Civil Aircraft (Article 21.5 – US), para. 5.745.
1189 See e.g. Appellate Body Reports, EC – Asbestos, paras. 81-82; EC and certain member
States – Large Civil Aircraft (Article 21.5 – US), para. 5.749; EC ‒ Seal Products, para. 5.69;
Russia – Commercial Vehicles, para. 5.141.
1190 See e.g. Appellate Body Reports, EC – Export Subsidies on Sugar, para. 339; EC ‒ Seal Products,
para. 5.69.
1191 Japan's appellant's submission, para. 335.

dated 26 June 2014; and (iii) OTI's Interim Report dated 23 October 2014.1192 On the other hand,
Korea maintains that "the 'final determination' within the meaning of Article 6.9 in the present case
was the Final Decision of MOSF" 1193 to impose definitive duties issued on 19 August 2015.1194
Moreover, Korea submits that the documents in which the "disclosure" of essential facts was made
are (i) KTC's Final Resolution and (ii) OTI's Final Report, both of which were issued prior to the
MOSF's Final Decision to impose definitive duties. 1195 Consequently, the participants have a
disagreement as to when in the investigation the Korean investigating authorities reached the "final
determination" within the meaning of Article 6.9. As a result, the participants also disagree on which
documents issued during the underlying investigation should be examined for purposes of assessing
the "disclosure" of essential facts.
5.477. We recall that the Panel found that Japan's panel request did not meet the requirements of
Article 6.2 of the DSU with respect to Japan's claim under Article 6.9 of the Anti-Dumping Agreement
and, consequently, that the claim was not within the Panel's terms of reference. As a result, the
Panel "neither consider[ed] … further nor resolve[d]" this claim. 1196 Thus, the Panel did not make
any finding s indicating which documents constitute the "final determination" or which are the
relevant "disclosure" documents for purposes of assessing compliance with Article 6.9, even though
these issues were contended by the parties in the course of the Panel proc eedings.1197 In the
"Relevant facts" section of its Report pertaining to this claim, the Panel limited itself to describing
the institutional structure and procedures for conducting anti -dumping investigations in Korea 1198,
providing a timeline of events in the underlying investigation1199, and summarizing relevant facts
regarding the four categories of facts that, in Japan's view, were not properly disclosed: (i) price
effects; (ii) volume; (iii) the state of the domestic industry; and (iv) causation.1200 In providing these
summaries, the Panel referred to multiple documents from the underlying investigation without
determining which of them, or whether all of them, constituted the "disclosure" documents for
purposes of Japan's claim under Article 6.9.1201
5.478. The question whether the disclosure of "essential facts" was made through the documents
alleged by Japan or those asserted by Korea encompasses a series of factual issues, with respect to
which the Panel made no findings, and certain legal issues that were left unexplor ed by the Panel.
For instance, the Panel made no findings on whether, under Korean law, the underlying anti-dumping
investigation was concluded on substance when the MOSF decided to impose definitive measures or,
alternatively, whether the anti-dumping investigation at issue was concluded on substance when the
KTC issued its Final Resolution. Findings regarding these issues are necessary in order to assess
which of the documents referred to by the participants constitute the "final determination" within

1192 Japan's appellant's submission, para. 334 (referring to KTC's Preliminary Resolution (Panel Exhibit
JPN-1b); OTI's Preliminary Report (Panel Exhibit JPN-2b); OTI's Interim Report (Panel Exhibit JPN-3b)).
1193 Korea's appellee's submission, para. 508 (referring to MOSF's Public Announcement (Panel Exhibit
KOR-3b (BCI))).
1194 In response to questioning at the oral hearing, Korea asserted that the Final Decision of the MOSF is
embodied in the MOSF's Public Announcement of the decision to impose anti-dumping duties on the pneumatic
transmissions valves from Japan, which is part of the Panel record as Panel Exhibit KOR-3b. Korea further
stated at the oral hearing that Decree No. 498, which is part of the Panel record as Panel Exhibit JPN-6b and is
entitled "Regulation Concerning the Imposition of Antidumping Duty on Valves for Pneumatic Transmissions
Originating from Japan", implements the MOSF's Final Decision by imposing anti-dumping duties for five years
on the imports of pneumatic valves from Japan. We note that, as found by the Panel, MOSF's Public
Announcement and MOSF's Decree No. 498 were both issued on 19 August 2015. (Panel Report, para. 2.5 and
fn 19 thereto)
1195 Korea's appellee's submission, para. 502. Korea refers to the KTC's Final Resolution and the OTI's
Final Report as "the last and complete piece of the disclosure documents for the purpose of Article 6.9". (Ibid.)
Korea also asserts that, "[i]n the course of the investigation, and in sufficient time for interested parties to
defend their interests, [the] KTC released several documents of relevance to Japan's claim." (Ibid. (referring to
Korea's first written submission to the Panel, paras. 358-404; second written submission to the Panel,
paras. 163-177))
1196 Panel Report, para. 7.517.
1197 See Panel Report, paras. 7.453-7.454 and 7.456.
1198 Panel Report, paras. 7.463-7.465.
1199 Panel Report, paras. 7.466-7.467.
1200 Panel Report, paras. 7.469-7.510.
1201 In addressing the four categories of facts that, in Japan's view, were not properly disclosed, the
documents cited by the Panel include: (i) KTC's Final Resolution (Panel Exhibit KOR-1b (BCI)); (ii) OTI's Final
Report (Panel Exhibit KOR-2b (BCI)); (iii) OTI's Interim Report (Panel Exhibit JPN-3b); and (iv) OTI's
Preliminary Report (Panel Exhibit JPN-2b). (Panel Report, paras. 7.469-7.510)

the meaning of Article 6.9, prior to which the required disclosure of essential facts should have
occurred. Moreover, the Panel made no findings as to whether, in the investigation at issue, the
KTC's Final Resolution and the OTI's Final Report constitute the last and complete piece of the
disclosure documents that formed the basis for the Final Decision by the MOSF, or, alternatively,
whether the disclosure of essential facts was made earlier in the proceedings through the OTI's
Preliminary Report dated 26 June 2014, the KTC's Preliminary Resolution dated 26 June 2014, and
the OTI's Interim Report dated 23 October 2014. Findings regarding these issues are necessary in
order to determine which of the documents referred to by the participants may be regarded as the
disclosure documents, whose content must be scrutinized for assessing the Korean investigating
authorities' compliance with Article 6.9.
5.479. The participants present conflicting views with respect to the issues described above.
Therefore, there is consider able uncertainty regarding which documents should be examined for
purposes of determining whether the Korean investigating authorities properly disclosed the
"essential facts" under consideration, as required by Article 6.9 of the Anti -Dumping Agreement.
Agreeing with Japan that the "final determination" within the meaning of Article 6.9 is the KTC's
Final Resolution would mean that the assessment under Article 6.9 should be conducted on the basis
of the documents issued before the KTC's Final Resolution, which include: (i) the OTI's Preliminary
Report; (ii) the KTC's Preliminary Resolution; and (iii) the OTI's Interim Report. By contrast, agreeing
with Korea that the "final determination" under Article 6.9 is the MOSF's decision from
19 August 2015 that resulted in the adoption of Decree No. 498 would mean that compliance with
Article 6.9 should be primarily determined on the basis of: (i) the KTC's Final Resolution; and
(ii) the OTI's Final Report.
5.480. In light of the above considerations, it is clear that the re are no Panel findings, undisputed
facts on the record, or a sufficient exploration by the Panel of certain key issues1202, for the purpose
of determining when the "final determination" within the meaning of Article 6.9 was reached in the
investigation at issue and which are the "disclosure" documents for purposes of Article 6.9.
Therefore, we are unable to ascertain which document constitutes the "final determination" in the
investigation at issue, such that the rele vant documents issued by the Korean investigating
authorities prior to the issuance of that final determination could be examined to assess whether
they properly disclosed the essential facts "before a final determination is made" and "in sufficient
time for the parties to defend their interests". Resolution of these issues is needed to determine
whether Korea acted inconsistently with Article 6.9 by failing to disclose the "essential facts" with
respect to price effects, the volume of the dumped imports, the state of the domestic industry, and
causation.1203
5.481. We conclude that, because key issues were left unexplored by the Panel and there is a lack
of sufficient factual findings by the Panel and uncontested facts on the record, there is considerable
uncertainty regarding when the "final determination" was reached in the investigation at issue and
which are the "disclosure" documents for purposes of Article 6.9. There is therefore no basis for us
to determine whether Korea acted inconsistently with Article 6.9 by failing to disclose the "essential
facts" under consideration. Consequently, we find ourselves unable to complete the legal analysis
with regard to Japan's claim that Korea acted inconsistently with Article 6.9 of the
Anti-Dumping Agreement.
6 FINDINGS AND CONCLUSIONS
6.1. For the reasons set out in this Report, the Appellate Body makes the following findings and
conclusions:
6.1 Overall considerations regarding the legal standard under Article 6.2 of the DSU
6.2. The requirements under Article 6.2 of the DSU are central to the establishment of the
jurisdiction of a panel. A panel request governs a panel's terms of reference and delimits the scope
of the panel's jurisdiction. In addition, by establishing and defining the jurisdiction of the panel, the
panel request also fulfils a due process objective by providing the respondent and third parties with
notice regarding the nature of the complainant's case and enabling them to respond accordingly.
Whether a panel request complies with the requiremen ts of Article 6.2 of the DSU must be

1202 See para. 5.475 above.
1203 Japan's appellant's submission, para. 334.

determined on the face of the panel request, on a case-by-case basis. Defects in the request for the
establishment of a panel cannot be cured in the subsequent submissions of the parties during the
panel proceedings. However, in considering the sufficiency of a panel request, submissions and
statements made during the course of the panel proceedings, in particular the first written
submission of the complaining party, may be consulted in order to confirm the meaning of the words
used in the panel request.
6.3. In order to "provide a brief summary of the legal basis of the complaint sufficient to present
the problem clearly" pursuant to Article 6.2 of the DSU, a panel request must plainly connect the
measure(s) with the provision(s) of the covered agreements claimed to have been infringed. The
identification of the treaty provision claimed to have been violated by the respondent is "always
necessary" and a "minimum prerequisite", but may not be sufficient to meet the above requirement
of Article 6.2 depending on the particular circumstances of a case. Such circumstances include the
nature of the measure at issue and the manner in which it is described in the panel request, as well
as the nature of the provisions of the covered agreements alleged to have been breached.
6.2 Domestic industry
6.2.1 Whether the Panel erred in finding that Japan's claim 7 concerning the definition of
the domestic industry was not within its terms of reference
6.4. Japan's panel request refers to both Articles 3.1 and 4.1 of the Anti-Dumping Agreement and
thus identifies the provisions of the covered agreements alleged to have been breached. Japan's
claim also makes clear that it relates specifically to the portion of the measure at issue concerning
the definition of the domestic industry and its alleged inconsistency with Korea's obligation under
Articles 3.1 and 4.1. In turn, Articles 3.1 and 4.1 together establish a distinct, well -delineated
obligation regarding the definition of the domestic industry. Thus, Japan's claim 7 "provide[s] a brief
summary of the legal basis of the complaint sufficient to present the problem clearly" within the
meaning of Article 6.2 of the DSU. For the foregoing reasons, we find that the Panel erred in finding
that claim 7 in Japan's panel request was not within its terms of reference.
a. Consequently, we reverse the Panel's finding , in paragraphs 7.67 and 8.1.a of the
Panel Report, and find that Japan's claim 7 is within the Panel's terms of reference.
6.2.2 Whether the Appellate Body can complete the legal analysis
6.5. In defining the domestic industry as a "major proportion" of the total domestic production, an
investigating authority is required t o assess both quantitative and qualitative aspects, and ensure
that it does not act in a manner that gives rise to a material risk of distortion. As discussed in
section 5.2.2 above, we are unable to complete the legal analysis with regard to the above aspects
of the "major proportion" requirement. First, in the absence of relevant factual findings by the Panel
or undisputed facts on the Panel record, we are unable to assess whether the KTC considered the
available evidence objectively in calculating the pr oportion of the total domestic production
accounted for by the applicants. In addition, we do not have sufficient factual findings by the Panel
or undisputed facts on the Panel record to assess whether the two applicants included in the
definition of the domestic industry were sufficiently representative of the total domestic production,
or whether the Korean investigating authorities' process of defining the domestic industry introduced
a material risk of distortion.
a. Consequently, we find ourselves unable to complete the legal analysis regarding Japan's
claim that the Korean investigating authorities' definition of the domestic industry is
inconsistent with Articles 3.1 and 4.1 of the Anti-Dumping Agreement.
6.3 Determination of injury
6.3.1 Whether the Panel erred i n finding that Japan's claim 1 concerning the volume of
dumped imports was not within its terms of reference
6.6. Japan's claim 1 identifies both Articles 3.1 and 3.2 of the Anti -Dumping Agreement as the
provisions alleged to have been breached, and indicates t hat it relates to "Korea's analysis of a
significant increase of the imports under investigation". This claim thus identifies the provisions of

the covered agreements alleged to have been breached. It further makes clear that it concerns the
specific portion of the measure at issue relating to the Korean investigating authorities' consideration
of the volume of the dumped imports and its alleged inconsistency with Articles 3.1 and 3.2 of the
Anti-Dumping Agreement. With regard to volume, Article 3.1 and the first sentence of Article 3.2
together establish a distinct and well -delineated obligation that the investigating authorities make
an objective examination of whether there has been a significant increase in dumped imports on the
basis of positive evidence. Thus, Japan's claim 1 "provide[s] a brief summary of the legal basis of
the complaint sufficient to present the problem clearly" within the meaning of Article 6.2 of the DSU.
For the foregoing reasons, we find that the Panel erred in f inding that Japan's claim 1, concerning
the volume of the dumped imports, was not within its terms of reference.
a. Consequently, we reverse the Panel's finding , in paragraphs 7.94 and 8.1.b of the
Panel Report, and find that Japan's claim 1 is within the Panel's terms of reference.
6.3.2 Whether the Panel erred in finding that Japan's claim 2 concerning the price effects
was not within its terms of reference
6.7. Japan's claim 2 identifies both Articles 3.1 and 3.2 of the Anti -Dumping Agreement as the
provisions alleged to have been breached. In addition, Japan's panel request indicates that this claim
concerns the specific portion of the measure at issue that relates to the Korean investigating
authorities' consideration of the price effects of the dumped imports, more precisely significant price
suppression and price depression, and its alleged inconsistency with Articles 3.1 and 3.2. With regard
to price effects, t he second sentence of Article 3.2, in conjunction with Article 3.1, sets out an
obligation that is distinct and well defined, with, at its core, the requirement to consider, on the
basis of an objective examination of positive evidence, whether the effect of the dumped imports on
domestic prices consists of the economic phenomena contained therein, incl uding significant price
suppression and price depression. Therefore, Japan's claim 2 "provide[s] a brief summary of the
legal basis of the complaint sufficient to present the problem clearly" within the meaning of
Article 6.2 of the DSU. For the foregoing reasons, we find that the Panel erred in finding that Japan's
claim 2, concerning the price effects of the dumped imports, was not within its terms of reference.
a. Consequently, we reverse the Panel's finding , in paragraphs 7.131 and 8.1.c of the
Panel Report, and find that Japan's claim 2 is within the Panel's terms of reference.
6.3.3 Whether the Panel erred in finding that part of Japan's claim 3 concerning the
impact of the dumped imports on the domestic industry was not within its terms of
reference
6.8. Japan's cl aim 3 identifies the portion of the measure at issue that relates to the Korean
investigating authorities' "analysis of the impact of the imports under investigation on the domestic
industry" and thus identifies with sufficient precision the specific aspec t of the measure at issue.
Claim 3 also identifies Articles 3.1 and 3.4 of the Anti-Dumping Agreement as the provisions alleged
to have been breached. Article 3.4, together with Article 3.1, establishes a distinct obligation that
essentially requires the i nvestigating authorities to examine objectively the impact of the dumped
imports on the domestic industry on the basis of positive evidence concerning all relevant economic
factors and indices having a bearing on the state of the domestic industry. Japan's claim 3 thus
"provide[s] a brief summary of the legal basis of the complaint sufficient to present the problem
clearly" within the meaning of Article 6.2 of the DSU. The three allegations that the Panel found to
be outside its terms of reference, like Jap an's other arguments under claim 3, serve to explain the
manner in which the Korean investigating authorities would have breached the distinct obligation
established by Articles 3.1 and 3.4, such that Japan was not required to include this level of detail
in its panel request. For the foregoing reasons, we find that the Panel erred in finding that these
three allegations were not within its terms of reference.
a. We therefore reverse the Panel's finding, in paragraph 7.175 of the Panel Report, that "all
other allegations of inconsistency with Article 3.4 argued by Japan are not properly within
the Panel's terms of reference", and in paragraph 8.1.d of the Panel Report, that "Japan's
claim under Articles 3.1 and 3.4 of the Anti-Dumping Agreement concerning the impact of
the dumped import on the state of the domestic industry" was not within the Panel's terms
of reference, and find the three allegations described above to be within the Panel's terms
of reference.

6.3.4 Whether the Panel erred in finding that Japan's claim 4 was within its terms of
reference
6.9. Japan's claim 4 identifies Articles 3.1 and 3.5 of the Anti-Dumping Agreement as the provisions
alleged to have been breached, and relates specifically to the Korean investigating authorities'
alleged failure to demonstrate that the imports under investigation were causing injury to the
domestic industry. While Article 3.5, together with Article 3.1, establishes obligations that are
multilayered, Japan has indicated which aspect of the obligations set forth in Articles 3.1 and 3.5 is
alleged to have been breached. Japan's claim 4, on its face, is about the alleged failure to
demonstrate the causal relationship on the basis of an "objective examination" of "all relevant …
evidence before the authorities" as required under Article 3.5, in particular its second sentence, as
well as under Article 3.1. Thus, Japan's claim 4 "provide[s] a brief summary of the legal basis of the
complaint sufficient to present the problem clearly" within the meaning of Article 6.2 of the DSU.
For these reasons, we find that the Panel did not err in finding that Japan' s claim 4 was within its
terms of reference.
a. Consequently, we uphold the Panel's finding in paragraphs 7.235 and 8.2.c of the
Panel Report.
6.3.5 Whether the Panel erred in finding that part of Japan's claim 5 was within its terms
of reference
6.10. Japan's claim 5 identifies Articles 3.1 and 3.5 of the Anti -Dumping Agreement as the
provisions alleged to have been breached, and relates to a specific aspect of the causation
determination, namely the Korean investigating authorities' examination of the non-attribution
factors. While Articles 3.1 and 3.5 establish obligations that are multilayered, Japan has identified
which aspect of the provisions its claim concerns, namely the requirement not to attribute to the
dumped imports the injuries caused by an y known factors other than the dumped imports . Thus,
Japan's claim 5 "provide[s] a brief summary of the legal basis of its complaint sufficient to present
the problem clearly" within the meaning of Article 6.2 of the DSU. For the foregoing reasons, we find
that the Panel did not err in finding that part of Japan's claim 5, with regard to Korea's alleged failure
to consider adequately all known factors other than the dumped imports causing injury, was within
its terms of reference.
a. Consequently, we uphold the Panel's finding, in paragraphs 7.241 and 8.2.d of the Panel
Report, that Japan's claim under Articles 3.1 and 3.5 of the Anti -Dumping Agreement,
insofar as it relates to the alleged failure of the Korean investigating authorities to examine
certain known factors adequately and their examination of those factors in isolation , is
properly within the Panel's terms of reference.
6.3.6 Whether the Panel erred in finding that Japan's claim 6 was within its terms of
reference
6.11. Japan's claim 6 identifies Articles 3.1 and 3.5 of the Anti -Dumping Agreement as the
provisions alleged to have been breached , and concerns a specific aspect of the Korean measure,
namely the determination of causation by the Korean investigating authorities within the meaning
of Article 3.5. While Articles 3.1 and 3.5 establish obligations that are multilayered, Japan has
identified in the narrative of its claim the particular aspect of the provisions its claim relates to. By
indicating that "Korea's demonstration of causation lacks any foundation in its analyses of the volume
of the imports under investigation, the effects of th e imports under investigation on prices, and/or
the impact of the imports under investigation on the domestic industry at issue", Japan's claim 6
indicates that it takes issue with the demonstration of the causal relationship between the dumped
imports and the domestic industry as provided in the first sentence of Article 3.5 of the
Anti-Dumping Agreement. Thus, the Panel rightly took the view that the narrative in Japan's panel
request is sufficiently precise to present the problem clearly. In addition, whether a claim is related
to, contingent on, or independent from another claim does not detract from the requirement under
Article 6.2 of the DSU to consider the panel request on its face to determine whether it provides the
legal basis of the complaint sufficient to present the problem clearly. For these reasons, we find that
the Panel did not err in finding that Japan's claim 6 was within its terms of reference.

a. Consequently, we uphold the Panel's finding in paragraphs 7.226 and 8.2.b of the
Panel Report.
6.3.7 Magnitude of the margin of dumping
6.12. Articles 3.1 and 3.4 require an investigating authority to evaluate the magnitude of the margin
of dumping, and to assess its relevance and the weight to be attributed to it in the injury assessment.
However, we do not consider that these provisions require any one of the listed factors, such as the
magnitude of the margin of dumping, to be evaluated in a particular manner or given a particular
relevance or weight, in examining the impact of the dumped imports on the dome stic industry.
Therefore, we find that the Panel did not err in its interpretation of Articles 3.1 and 3.4 of the
Anti-Dumping Agreement with respect to the evaluation of the magnitude of the margin of dumping.
In addition, we find that Japan has failed to substantiate that: (i) the Korean investigating authorities
did not evaluate the magnitude of the margin of dumping as required under Articles 3.1 and 3.4;
and (ii) the Korean investigating authorities were required to conduct a counterfactual analysis in
light of the facts of the case.
a. Consequently, we uphold the Panel's finding, in paragraphs 7.189-7.192 and 8.3.a of the
Panel Report, that Japan failed to establish that the Korean investigating authorities acted
inconsistently with Articles 3.1 and 3.4 o f the Anti -Dumping Agreement with respect to
their evaluation of the magnitude of the margin of dumping.
6.3.8 Causation
6.3.8.1 Whether the Panel erred in its interpretation or application of Article 3.5 in
addressing Japan's claim 6
6.13. With respect to a claim under Article 3.5, a panel is tasked with reviewing an investigating
authority's ultimate demonstration that "dumped imports are, through the effects of dumping, as
set forth in paragraphs 2 and 4 , causing injury" to the domestic in dustry. In so doing, a panel is
called upon to review whether the investigating authority properly linked the outcomes of its
analyses conducted pursuant to Articles 3.2 and 3.4, taking into account the evidence and factors
required under Article 3.5, in coming to a definitive determination regarding the causal relationship
between dumped imports and injury to the domestic industry. A panel's review does not, however,
call for revisiting the question whether each of the interlinked components of this determ ination
itself meets the applicable requirements set out in Article 3.2 or Article 3.4. Examining such
consistency in the context of a claim under Article 3.5 would effectively require a panel to incorporate
and apply obligations and disciplines set out in other paragraphs of Article 3, which are not contained
in the text of Article 3.5. We agree with Korea that the phrase "through the effects of dumping, as
set forth in paragraphs 2 and 4" in Article 3.5 "is not a call [for a panel] to re-do the examination[s]"
under Articles 3.2 and 3.4 of the Anti-Dumping Agreement.
6.14. In the present dispute, under claim 6, Japan alleged that the KTC's causation determination
was undermined by its flawed analyses of the volume of the dumped imports, the price effects, and
the impact of the dumped imports on the state of the domestic industry, "irrespective and
independent" of whether the Panel found the KTC's analyses of volume, price effects, and impact to
be inconsistent with Articles 3.2 and 3.4 of the Anti-Dumping Agreement.
6.15. In addressing claim 6, the Panel first considered Japan's arguments with respect to the volume
of dumped imports. The Panel noted that "Japan's allegation that certain flaws in the KTC's analysis
of the volume of dumped imports 'independently' underm ine[d] its causation determination" was
based on the fact that: (i) the volume of dumped imports decreased during two years of the
three-year period of trend analysis; and (ii) the volume of dumped imports increased only modestly
in absolute terms and decreased in terms of market share in 2013 compared with 2010. The Panel
rejected these arguments and found that Japan failed to demonstrate that the Korean investigating
authorities acted inconsistently with Articles 3.1 and 3.5 of the Anti -Dumping Agreement . In so
doing, the Panel reviewed the Korean investigating authorities' analysis pursuant to the
requirements set out in Article 3.2, first sentence, as opposed to those under Article 3.5. Thus, in
reviewing the causation claim at issue, the Panel effective ly incorporated the requirements in
Article 3.2, first sentence, rather than properly applying the requirements set out in Article 3.5 in its

assessment of the causation claim at issue. We therefore consider the Panel to have erred in its
application of Article 3.5.
6.16. With respect to price effects in the context of claim 6, before the Panel, Japan advanced three
grounds in support of its claim that the KTC's analysis of the price effects of the dumped imports
"independently" undermined its causation determination, namely that: (i) there was divergence
between the trends in dumped import and domestic like product prices; (ii) dumped imports
consistently and significantly oversold the domestic like product; and (iii) there was no competitive
relationship between the dumped imports and the domestic like product, such that their prices were
not comparable. The Panel found that the KTC acted inconsistently with Articles 3.1 and 3.5 of the
Anti-Dumping Agreement by "failing to ensure price comparability, in terms of the dates and sales
quantities involved, when it compared the individual transaction prices of certain models of dumped
imports with the average prices of corresponding models of the domestic like product". Concerning
overselling, the Panel found that the Korean investigating authorities failed to explain adequately
their consideration of the price-suppressing and -depressing effects of dumped imports in their
determination of causatio n, in light of the undisputed fact that the prices of the dumped imports
were higher than those of the domestic like product throughout the period of trend analysis, and
therefore acted inconsistently with Articles 3.1 and 3.5. As for diverging price trends, the Panel found
that the different magnitude s of the price decreases from 2012 to 2013 and the opposing price
movements from 2011 to 2012 d id not, in and of themselves, demonstrate that the KTC's
determination of a causal relationship was inconsistent with Articles 3.1 and 3.5.
6.17. To the extent that an investigating authority relies on price comparisons in its consideration
of the price effects of dumped imports, price comparability needs to be ensured. Thus, where an
investigating authority fails to ensur e price comparability in price comparisons between dumped
imports and the domestic like products, this undermines its findings of price effects under Article 3.2,
to the extent that it relies on such price comparisons. We agree with the Panel that the KTC was
required to ensure price comparability in its price comparisons inasmuch as it relied on the price
differentials in these comparisons to find that dumped imports had price -suppressing
and -depressing effects on domestic prices. Likewise, we agree with the Panel that , given the
consistent overselling by the dumped imports and the fact that the average prices of the models of
dumped imports involved in the individual instances of "underselling" were higher than the average
prices of the corresponding domestic models, an explanation and analysis of how and to what extent
the prices of the domestic like product are affected was necessary. That said, our review of the
Panel's findings indicates that, for each of these arguments , the analyses carried out by th e Panel
were pertinent to a claim under Article 3.2 and were in line with the requirements of that provision,
rather than to a claim under Article 3.5. In so doing, the Panel effectively incorporated the
requirements of Article 3.2, rather than properly applying the requirements set out in Article 3.5,
even though it was reviewing a claim under the latter provision . With respect to a claim under
Article 3.5, a panel's review does not call for revisiting the question whether each of the interlinked
components of the causation determination itself meets the applicable requirements set out under
their respective provisions, such as the determination of price effects under Article 3.2. We therefore
consider the Panel to have erred in its application of Article 3.5.
6.18. Finally, with respect to the examination of the impact of dumped imports in the context of
claim 6, before the Panel, Japan relied on its argument that, because the KTC did not establish any
logical connection between the effects of the dumped imports under Article 3.2 and the condition of
the domestic industry for the purpose of its impact analysis under Article 3.4, its causation
determination was undermined. The Panel found that "'the logical progression of inquiry' does not
mean that the examination of impact under Article 3.4 must be linked to the consideration under
Article 3.2." We agree with the Panel that, in order to examine the impact of dumped imports on the
domestic industry properly for purposes of Article 3.4, an investigating authority is not required to
link that examination with its consideration of the volume and the price effects of the dumped
imports. Similarly, we agree with the Panel's finding that "there is no need 'to undertake a fully
reasoned causation and non -attribution analysis' as part of Article 3.4." However, the Panel's
examination of the alleged flaws in the Korean investigating authorities' impact analysis primarily
relates to the issue of whether the KTC's impact examination was in line with the requirements set
out in Article 3.4, as opposed to Article 3.5. In so doing, the Panel effectively incorporated the
requirements of Article 3.4 rather than properly applying the requirements set out in Article 3.5,
even though it was reviewing a claim under the latter provision. Article 3.5 does not foresee a panel
revisiting the question whether an investigating authority's impact analysis is consistent with
Article 3.4. We therefore consider the Panel to have erred in its application of Article 3.5.

a. Consequently, we reverse the Panel's finding, in paragraph 8.4.a of the Panel Report, that
Japan has demonstrated that the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.5 of the Anti-Dumping Agreement in their causation analysis as a result
of flaws in their analysis of the effect of the dumped imports on prices in the domestic
market.
6.3.8.2 Whether the Panel erred in its interpretation or application of Article 3.5 in
addressing Japan's claim 4
6.19. In addressing Japan's volume-related arguments in the context of claim 6, the Panel reviewed
the requirements under Article 3.2, first sentence, as opposed to those under Article 3.5. Thus, the
Panel effectively incorporated the requirements in Article 3.2, first sentence, concerning the volume
of dumped imports in its assessment of Japan's claim under Article 3.5, rather than applying properly
the requirements set out in Article 3.5. Given that the Panel relied on the same considerations in
rejecting Japan's arguments concerning the lack of correlation in volume trends in the context of the
causation claim at issue (claim 4), we find the Panel's finding in this regard to be in error.
6.20. The Panel's analysis of the diverging trends in the context of Japan's claim 6 focused on
whether there was a lack of competitive relat ionship between dumped imports and domestic like
products, and whether the diverging price trends could, in and of themselves, undermine the causal
relationship under Article 3.5. The Panel reviewed the Korean investigating authorities' examination
of the relationship between the prices of the dumped imports and those of the domestic like products,
in order to ascertain the effects of the former on the latter, which corresponds to an examination
properly conducted pursuant to Article 3.2, second sentence. Therefore, the Panel's conclusion that
the diverging price trends, do not, in and of themselves, demonstrate that the KTC's determination
of a causal relationship is inconsistent with Articles 3.1 and 3.5 was a mere consequence of its
analysis as to whether the KTC's price-effects analyses were objective and reasoned, and compatible
with the requirements set out in Article 3.2, second sentence. For these reasons, the Panel's analysis
of the issue of diverging price trends was based on the applicable requirements under Article 3.2,
rather than those concerning causation under Article 3.5, even though it was addressing a claim
under the latter provision . Given that the Panel, in the context of the causation claim at issue
(claim 4), relied on the same considerations in rejecting Japan's arguments concerning the lack of
correlation in price trends due to the diverging price trends, we find the Panel's finding in this regard
to be in error.
6.21. With respect to profit trends, neither the Panel nor the KTC ignored the alleged lack of
correlation between the domestic-industry profit, dumped import prices, and the volume and market
share of the dumped imports. For these reasons, we reject Japan's argument that the KTC's
discussion on this issue was deficient, and that the Panel should have recognized this alleged
deficiency. We do not see any error in the Panel's finding that Japan has failed to establish that the
insufficient correlation between dumped imports and trends in domestic -industry profits
demonstrates that a reasonable and unbiased investigating authority could not have properly found
the required causal relationship between the dumped imports and injury to the domestic industry in
light of the facts and arguments that were before the KTC.
a. Consequently, we uphold the Panel's finding, in paragraph 8.3.b of the Panel Report, that
Japan has not demonstrated that the Korean investigating authorities acted inconsistently
with Articles 3.1 and 3.5 of the Anti-Dumping Agreement with respect to their conclusion
that the dumped imports, through the effects of dumping, were causing injury to the
domestic industry, insofar as Japan's argument regarding insufficient correlation between
dumped imports and trends in domestic-industry profits is concerned.
6.3.9 Whether the Appellate Body can complete the legal analysis under Articles 3.1, 3.2,
and 3.4 of the Anti-Dumping Agreement
6.3.9.1 Whether the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.2 of the Anti -Dumping Agreement in their consideration of the volume
of dumped imports
6.22. Japan makes certain arguments in support of its present claim under Articles 3.1 and 3.2 that
are identical to those addressed by the Panel in the context of claim 6. Japan argues that the KTC

acted inconsistently with Articles 3.1 and 3.2 by "improperly" finding a "significant increase" in
subject imports, even though the volume of such imports "actually fell in two out of three of the
comparison periods and ended the overall period up only slightly on an absolute basis and actually
down on a relative basis". Thus, like its argument in the context of claim 6, Japan focuses on the
alleged failure by the KTC to take into account the decrease of import volumes in absolute terms
during the first two years of the POI, and the decrease of import volumes in relative terms, in finding
that there was a "significant increase" in the volume of imports. The Panel's analysis of Japan's
identical arguments in the context of claim 6 properly reviewed the requirements set out in
Article 3.2, first sentence.
6.23. However, Japan's arguments in the context of its present claim under Articles 3.1 and 3.2
concerning the volume of dumped imports , regarding which it requests us to complete the legal
analysis, encompass broader considerations than those contained in the findings by the Panel,
namely that: (i) the KTC improperly assumed a competitive rela tionship between domestic like
products and subject imports; and (ii) the KTC improperly found a "significant increase" in subject
imports without examining whether the increased imports actually replaced domestic like products
through market competition. The Panel did not sufficiently explore these issues with the participants.
Moreover, the underlying factual bases pertaining to these issues are contested between the
participants. Confronted with these circumstances, completion of the legal analysis with respect to
these issues is hindered by the absence of relevant factual findings, sufficient undisputed facts on
the panel record, and a sufficient exploration by the Panel. Thus, engaging in the completion exercise
would require us to review and consider evidence and arguments that were not sufficiently addressed
by the Panel or sufficiently explored and developed before the Panel.
a. Consequently, we find ourselves unable to complete the legal analysis as to whether the
Korean measures are inconsist ent with Articles 3.1 and 3.2 of the Anti -Dumping
Agreement with respect to the Korean investigating authorities' consideration of the
volume of dumped imports.
6.3.9.2 Whether the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.2 of the Anti-Dumping Agreement in their consideration of price effects
6.24. Japan requests us to complete the legal analysis and find that the Korean investigating
authorities failed to meet their obligations under Articles 3.1 and 3.2 of the Anti-Dumping Agreement
because: (i) the KTC failed to ensure the price comparability; (ii) the KTC failed to consider the
implications of overselling by the dumped imports; and (iii) the KTC largely ignored the diverging
price trends. Japan also contends that the KTC erred in its findings because it failed to address the
counterfactual question of how prices might have been different in the absence of dumping and the
KTC never considered whether the alleged price suppression and price depression were significant.
Finally, Japan contends that the "reasonable sales price" analysis conducted by the KTC was "flawed
and insufficient".
6.25. With respect to price comparability and price overselling, Japan raised identical arguments in
the context of claim 6. The Panel's analyses and findings, although made in the context of claim 6,
were nonetheless in line with and properly conducted under the requirements set out in Article 3.2,
second sentence. The flaws that the Panel identified concerned the objectivity and evidentiary
foundation of the KTC's price suppression and price depression findings under Articles 3.1 and 3.2.
Therefore, as the Korean investigating authorities found price -suppressing and -depressing effects
of dumped imports based on (i) the transaction-to-average price comparisons without ensuring price
comparability and (ii) failed to provide an explanation and analysis of how and to what extent the
prices of the domestic like product w ere affected in light of the consistent overselling by dumped
imports, we find them to have acted inconsistently with Articles 3.1 and 3.2 of the Anti -Dumping
Agreement. With respect to diverging price trends, Japan raised an identical argument in the context
of claim 6. The Panel's findings, although made in the context of claim 6, properly reviewed the
Korean investigating authorities' examination of the relationship between the prices of the dumped
imports and those of the domestic like product s, in order to ascertain the effects of the former on
the latter. This corresponds to an examination properly conducted pursuant to Article 3.2, second
sentence. The Panel properly reviewed the Korean investigating authorities' consideration of the
diverging price trends in light of the requirements set out in Article 3.2, second sentence, and found
it reasonable and supported by facts. We therefore reject Japan's allegation that the KTC "largely
ignored" the diverging price trends. Accordingly, we find that the Korean investigating authorities

did not act inconsistently with Articles 3.1 and 3.2 of the Anti-Dumping Agreement with respect to
their consideration of diverging price trends.
6.26. With respect to Japan's arguments concerning (i) the KTC's failure to ad dress the
counterfactual question of how prices might have been different in the absence of dumping, (ii) the
KTC's failure to address whether the alleged price suppression and price depression were significant,
and (iii) whether the "reasonable sales pric e" analysis conducted by the KTC was "flawed and
insufficient", the Panel never explored these arguments with the parties. Moreover, the parties
disagree with respect to the factual bases underlying these arguments. Therefore, given the limited
scope and nature of the Panel's factual findings and the limited undisputed record evidence in this
regard, our attempt to complete the legal analysis involving such competing arguments would
require us to review and consider evidence and arguments that were not suff iciently addressed by
the Panel or sufficiently explored and developed before the Panel.
a. For the foregoing reasons, we find that we are able to complete the legal analysis in part.
For the reasons explained above, we find that the Korean investigating aut horities acted
inconsistently with Articles 3.1 and 3.2 of the Anti-Dumping Agreement: (i) to the extent
that they found price-suppressing and -depressing effects of dumped imports based on
the relevant price comparisons without ensuring price comparability; and (ii) in the
absence of any explanation and analysis of how and to what extent the prices of the
domestic like product were affected in light of the consistent overselling by the dumped
imports when finding price suppression and price depression. We also find that the Korean
investigating authorities did not act inconsistently with Articles 3.1 and 3.2 of the
Anti-Dumping Agreement with respect to their consideration of diverging price trends.
b. However, for the reasons explained above, we find ourselves unable to complete the legal
analysis as to whether the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.2 on the basis of Japan's arguments that: (i) the KTC failed to address
the counterfactual question of how p rices might have been different in the absence of
dumping; (ii) the "reasonable sales price" analysis was flawed and insufficient, as the KTC
failed to examine market interactions between the subject imports and domestic like
products; and (iii) the KTC never considered whether the alleged price suppression and
price depression were "significant".
6.3.9.3 Whether the Korean investigating authorities acted inconsistently with
Articles 3.1 and 3.4 of the Anti -Dumping Agreement in their consideration of the impact
of dumped imports on the state of the domestic industry
6.27. Japan argues that the Korean investigating authorities acted inconsistently with Articles 3.1
and 3.4 of the Anti-Dumping Agreement because the KTC did not establish any logical link between
its findings regarding the volume and price effects under Article 3.2 of the Anti-Dumping Agreement
and its finding of impact under Article 3.4. We recall that in reviewing the Panel's finding in the
context of claim 6, where Japan raised an identical argument, we hav e agreed with the Panel that,
in order to examine the impact of dumped imports on the domestic industry properly for purposes
of Article 3.4, an investigating authority is not required to link that examination with its consideration
of the volume and the p rice effects of the dumped imports. We have also rejected above Japan's
understanding that Article 3.4 contemplates an exhaustive analysis of all known factors that may
cause injury to the domestic industry. However, Japan's arguments in the context of its present
claim under Articles 3.1 and 3.4, regarding which it requests us to complete the legal analysis,
encompass broader considerations. Not only does Japan make an argument about the positive trend
experienced by the domestic industry with respect to domestic sales, but Japan also asserts that the
KTC attached a high degree of importance to the other relevant factors highlighting negative aspects
of the domestic industry, while disregarding or downplaying those factor s that showed positive
trends. Thus, Japan's contention that, in so doing, the KTC acted inconsistently with Articles 3.1 and
3.4 would require us to review the KTC's examination of impact and the weight it attributed to each
of the factors listed in Artic le 3.4 regarding which the Panel, notably, made no findings. Such an
exercise would require us to review and consider evidence and arguments that were not sufficiently
addressed by the Panel or sufficiently explored and developed before the Panel.
a. Consequently, we find ourselves unable to complete the legal analysis as to whether the
Korean investigating authorities acted inconsistently with Articles 3.1 and 3.4 of the
Anti-Dumping Agreement on the basis of Japan's argument that the KTC failed to explain

adequately how imports had negatively impacted the domestic like products as a whole in
light of positive trends experienced by the domestic industry.
6.4 Confidential treatment of information
6.4.1 Whether the Panel erred in finding that Japan's claims 8 and 9 concer ning the
confidential treatment of information were within its terms of reference
6.28. Japan's claims 8 and 9 concerning the confidential treatment of information identify
Articles 6.5 and 6.5.1 of the Anti -Dumping Agreement, respectively, as the provisions all eged to
have been breached. Japan's claims also indicate that they relate, respectively, to the specific portion
of the measure concerning Korea's treatment of certain information as confidential under Article 6.5
of the Anti-Dumping Agreement and Korea's treatment of non-confidential summaries of confidential
information under Article 6.5.1 of the Anti-Dumping Agreement. Article 6.5 establishes a clear and
well-delineated obligation for investigating authorities to treat information submitted by parties to
an investigation as confidential if it is "by nature" confidential or "provided on a confidential basis" ,
and "upon good cause shown". In addition, Japan's claim 9 refers to the first two sentences of
Article 6.5.1, which set forth a clear and well-delineated obligation for the investigating authority to
require non-confidential summaries in sufficient detail to permit a reasonable understanding of the
substance of the information submitted in confidence. Therefore, Japan's claims 8 and 9 each
"provide a brief summary of the legal basis of the complaint sufficient to present the problem clearly"
within the meaning of Article 6.2 of the DSU. For the foregoing reasons, we find that the Panel did
not err in finding that Japan's claims 8 and 9, concerning the confidential treatment of information,
were within its terms of reference.
a. Consequently, we uphold the Panel's findings in paragraphs 7.418 and 8.2.e of the
Panel Report.
6.4.2 Whether the Panel erred in its interpretation or application of Article 6.5 of t he
Anti-Dumping Agreement
6.29. In articulating the legal standard under Article 6.5, the Panel did not pronounce on the specific
manner in which investigating authorities should specify that "good cause" was shown when granting
confidential treatment to certain information. Under Article 6.5, an investigating authority is required
to assess objectively whether the request for confidential treatment has been sufficiently
substantiated such that "good cause" has been shown. The fact that the investigating authority has
conducted this objective assessment must be discernible from its published report or related
supporting documents. The Panel's analysis comports with the legal standard under Article 6.5.
Consequently, we find that the Panel did not err in its interpretation of Article 6.5.
6.30. Furthermore, with respect to the investigation at issue, the Panel stated that it could not
"conclude that the Korean Investigating Authorities actually engaged in a consideration of whether
the submitters of the information had shown good cause for confidential treatment of the information
in question". Korea argues that, in providing non -confidential summaries by way of deleting the
relevant information from their submissions, the providers of the information "implicitly" asserted
that such deleted information fell within the categories of "confidential information" set forth in the
relevant Korean laws. In Korea's view, as a consequence of that "implicit" assertion, "good cause"
was "shown" for granting confidential treatment to t hat information. As noted, the Panel was not
convinced by this argument because there is no evidence on the record "linking the information for
which confidential treatment was granted to the categories of information warranting confidential
treatment identified in Korean law" . Neither is there evidence suggesting that "the Korean
Investigating Authorities themselves undertook to link the information for which confidential
treatment was sought to the categories defined in Korean legislation and thereby determine whether
good cause for confidential treatment existed." Given these Panel findings, we disagree with Korea's
assertion that , "when [the] KTC received information that was considered confidential by the
interested parties, it objectively assessed whether there was indeed 'good cause' by confirming
whether the deleted information fell within a category of confidential information enumerated in the
relevant Korean laws." Consequently, we find that the Panel did not err in its application of
Article 6.5.

a. Consequently, we uphold the Panel's finding, in paragraphs 7.441, 7.451, and 8.4.b of the
Panel Report, that Japa n demonstrated that the Korean investigating authorities acted
inconsistently with Article 6.5 of the A nti-Dumping Agreement with respect to their
treatment of information provided by the applicants as confidential without requiring that
good cause be shown.
6.4.3 Whether the Panel erred in its application of Article 6.5.1 of the Anti -Dumping
Agreement
6.31. Article 6.5.1 mandates investigating authorities to require non -confidential summaries from
interested parties providing confidential information. These summaries shall be in sufficient detail to
permit a reasonable understanding of the substance of the information submitted in confidence. In
the present dispute, the Panel found that, "[i]n the complete absence of data, and with no narrative
summary with respect to the deleted information, the 'Disclosed' versions of the three
communications identified by Japan cannot be said to contain a summary in sufficient detail to
'permit a reasonable understanding of the substance of the information submitted in confidence '."
Korea does not challenge the Panel's appreciation of the facts under Article 11 of the DSU leading
to the above finding. Instead, Korea repeats certain arguments that the Panel had already rejected
without explaining why the Panel's analysis constitute s a misapplication of Article 6.5.1. In light of
the applicable legal standard and the reasoning provided by the Panel, we fail to see how the versions
of the submissions from which confidential information had been redacted could satisfy the legal
standard of being non -confidential summaries that are "in sufficient detail to permit a reasonable
understanding of the substance of the information submitted in confidence". In these circumstances,
we disagree with Korea's argument that "[the] KTC did not fail to require the applicants to provide
sufficient non-confidential summaries of the confidential information."
a. Consequently, we uphold the Panel's finding, in paragraphs 7.450, 7.451, and 8.4.c of the
Panel Report, that Japan demonstrated that the Korean investigating authorities acted
inconsistently with Article 6.5.1 of the Anti-Dumping Agreement by failing to require that
the submitting parties provide a sufficient non -confidential summary of the informati on
for which confidential treatment was sought.
6.5 Essential facts
6.5.1 Whether the Panel erred in finding that Japan's claim 10 concerning the disclosure
of essential facts was not within its terms of reference
6.32. Japan's claim 10 concerning the disclosure of essent ial facts identifies Article 6.9 of the
Anti-Dumping Agreement as the provision alleged to have been breached by Korea. Claim 10 also
specifically refers to the Korean investigating authorities' failure "to inform the interested parties of
the essential facts under consideration which formed the basis for the decision to impose definitive
anti-dumping measures". In addition, Article 6.9 sets forth a distinct and well-delineated obligation
requiring the investigating authority to disclose the essential facts to all interested parties in a timely
manner, that is, before the final determination is made and in sufficient time for the parties to defend
their interests. Thus, Japan's claim 10 "provide[s] a brief summary of the legal basis of the complaint
sufficient to present the problem clearly" within the meaning of Article 6.2 of the DSU. For the
foregoing reasons, we find that the Panel erred in finding that Japan's claim 10 concerning the
disclosure of essential facts was not within its terms of reference.
a. Consequently, we reverse the Panel's finding in paragraphs 7.517 and 8.1.f of the
Panel Report, and find that Japan's claim 10 is within the Panel's terms of reference.
6.5.2 Whether the Appellate Body can complete the legal analysis under Article 6.9 of the
Anti-Dumping Agreement
6.33. Because key issues were left unexplored by the Panel and there is a lack of sufficient factual
findings by the Panel and uncontested facts on the record, there is considerable uncertainty
regarding when the "final determination" was reached in the investig ation at issue and which are
the "disclosure" documents for purposes of Article 6.9 of the Anti -Dumping Agreement. There is
therefore no basis for us to determine whether Korea acted inconsistently with Article 6.9 by failing
to disclose the "essential facts" under consideration.