UNITED STATES – CONTINUED EXISTENCE AND APPLICATION OF ZEROING METHODOLOGY
Document: Notification of an Appeal by the European Communities under Article 16.4 and Article 17 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), and under Rule 20(1) of the Working Procedures for Appellate Review
Date: 10 November 2008
Document codes: WT/DS350/11
Complainant: EU
Respondent: U.S.
Third parties: Brazil, China, Egypt, India, Japan, South Korea, Mexico, Norway, Taiwan, Thailand
Dispute stage: Appellate Body
Agreements cited: Art. 2.1, 2.4, 2.4.2, 5.8, 9.1, 9.3, 9.5, 11, 1, 11.1, 11.3, 11.2, 2  Anti-dumpingArt. VI:1, VI:2  GATT 1994Art. 18.4  Anti-dumpingArt. XVI:4  Agreement Establishing the World Trade Organization

UNITED STATES – CONTINUED EXISTENCE AND APPLICATION
 OF ZEROING METHODOLOGY

Notification of an Appeal by the European Communities

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

 The following notification, dated 6 Novemb er 2008, from the Delegation of the European
Communities, is being circulated to Members.

 Pursuant to Article 16.4 and Article 17 of the DSU the European Communities hereby notifies
to the Dispute Settlement Body its decision to app eal to the Appellate Body certain issues of law
covered in the Panel report and cer tain legal interpretations devel oped by the Panel in the dispute

Pursuant to Rule 20(1) of the Working Procedures for Appellate Review , the European Communities
simultaneously files this Notice of Appeal with the Appellate Body Secretariat.
 For the reasons set out in its submissions to the Panel, and for the reasons to be further
elaborated in its submissions to the Appellate B ody, the European Communities appeals, and requests
the Appellate Body to modify or reverse the legal findings and conclusions of the Panel and complete
the analysis, with respect to the following errors of law and legal interpre tations contained in the
Panel Report:
(a) With respect to each of the 18 measures, th e Panel erred when finding that the European
Communities failed to identify in the panel requ est the specific measure at issue, as required
by Article 6.2 of the DSU, and that consequently the Eur opean Communities' claims with
respect to these 18 measures did not fall wi thin the Panel's terms of reference
(paragraphs 7.40 – 7.67, particularly paragra ph 7.61, and paragraph 8.1(b) of the Panel
Report). The Panel also erred in law when it found that each of the 18 measures is not a
measure within the meaning of Article 3.3 of the DSU (paragraph 7.56 of the Panel Report,
final sentence). In particular, the European Communities submits that the Panel Report:
• erroneously confounds the procedural le gal analysis under Article 6.2 of the DSU on
the question of whether or not the Europ ean Communities' Panel Request identified
the 18 specific measures at issue and the s ubstantive legal analysis under Article 3.3
of the DSU on the question of whether or not the 18 measures at issue are measures
within the meaning of that provision, suscep tible to dispute settlement (particularly,
but not only, at paragraphs 7.41 and 7.50 of the Panel Report);

• is inconsistent with Article 7.1 of the DSU regarding a panel's terms of reference;
with Article 12.1, Appendix 3 and paragra phs 4 and 13 of the Working Procedures of
24 July 2007 regarding the timeliness of submissions including requests for
preliminary rulings; with the rule that the United States had the burden of raising an
issue under Article 3.3 of the DSU; and with the rule that the Panel must not make the
case for the defending Member – insofar as the Panel made findings regarding the
existence and precise content of the 18 measu res, which relate to Article 3.3 of the
DSU, and concern matters never raised by the United States;
• is based on an erroneous interpretation of Article 6.2 of the DSU, insofar as it
requires, in effect, that the Article 3.3 DSU standard be met in the panel request
(particularly, but not only, at paragraph 7.50 of the Panel Report);
• is based on an erroneous interpretation of Article 3.3 of the DSU (and/or Article 6.2
of the DSU), insofar as it effectively interpreted that provision or those provisions so
as to conclude that the European Communities had not demonstrated the existence
and precise content of the 18 measures at issue (particularly, but not only, at
paragraphs 7.50, third sentence and paragr aphs 7.50, fifth and seventh sentences of
the Panel Report). The 18 measures are simply case specific instances of the
application of the zeroing methodology, the existence and precise content of which
has been repeatedly established. These measures are presently experienced directly by
EC exporters paying anti-dumping duty rates inflated by zeroing;
• is based on an erroneous interp retation of Article 6.2 of the DSU insofar as it
interpreted that provision so as to concl ude that the European Communities' Panel
Request did not identify the specific measure s at issue. The 18 measures are simply
more specific instances of the application of the zeroing methodology (identified by
reference to particular products, a particular exporting Member and particular duties);
• is inconsistent with Article 7.2 of the DSU insofar as the Panel did not, with respect
to this issue, address relevant provisions of the GATT 1994 (Articles II.2(b), VI.1,
VI.2 and XXIII) and the Anti-Dumping Agreement (Articles 1, 7.2, 8.6, 9.1, 9.2, 9.3,
11.1, 11.2, 11.3, 12.2.2, 15, 17.4 and 18.3.2) cited in this dispute;
• is inconsistent with Article 11 of the DSU, insofar as the Panel failed to make an
objective assessment of the matter before it, including an objective assessment of the
facts of the case and the applicability of a nd conformity with th e relevant covered
agreements; and
• is inconsistent with Article 12.7 of the DSU insofar as the Panel did not set out the
basic rationale behind its findings and recommendations.
Having modified or reversed the Panel's fi ndings, the European Communities requests the
Appellate Body to complete the analysis by findi ng that, with respect to the 18 measures, the
European Communities' Panel Request identified the specific measures at issue as required by
Article 6.2 of the DSU and, insofar as the Appellate Body reaches the issue, that the European
Communities demonstrated the existence and precise content of 18 measures within the
meaning of Article 3.3 of the DSU
. The European Communities further requests the Appellate
Body to complete the analysis by finding th at, because of the use of zeroing, each of the
18 measures is inconsistent with Articles VI :1 and VI:2 of the GATT 1994, Articles 2.4,
2.4.2, 9.3, 11.1 and 11.3 of the Anti-Dumping Agreement , and Article XVI:4 of the WTO
Agreement.

If the Appellate Body accepts this part of the appeal and completes the analysis as requested
by the European Communities, then the European Communiti es would accept that parts (b)
and (c) of this appeal could be dealt with by the Appellate Body declaring the Panel's findings
moot and of no legal effect.
(b) The Panel erred when excluding four preliminar y determinations from its terms of reference
on the basis of Articles 17.4 and 7.1 of the Anti-Dumping Agreement (paragraphs 7.70 – 7.77,
particularly paragraph 7.77, and paragraph 8.1(c) of the Panel Re port). The determinations in
question were not provisional measures within the meaning of Article 7, but part of the
continuing application of ex isting definitive anti-dumping duties based on zeroing, being
preliminary outcomes of one of the five types of anti-dumping proceeding.
Having modified or reversed the Panel's fi ndings, the European Communities requests the
Appellate Body to complete the analysis by finding that the administrative review preliminary
determination is inconsistent with Articles VI:2 of the GATT 1994, Articles 2.1, 2.4, 2.4.2,
9.3 and 11.2 of the Anti-Dumping Agreement, and Article XVI:4 of the WTO Agreement; and
that each of the three sunset review preliminar y determinations is inc onsistent with Articles
2.1, 2.4, 2.4.2, 11.1 and 11.3 of the Anti-Dumping Agreement, and Article XVI:4 of the WTO
Agreement.
(c) The Panel made factual and legal errors in violation of, inter alia, Article 11 of the DSU when
concluding that the European Communities had not shown that simple zeroing was used in
seven administrative reviews (paragraph 7.15 8 of the Panel Report and, by omission,
paragraph 8.1(e) of the Panel Report). In particular, the European Communities contends that:
• the Panel failed to carry out an objective assessment of the facts as required by
Article 11 of the DSU when concluding that the European Communities did not make
a prima facie case that simple zeroing w as used in seven administrative reviews
(paragraphs 7.145 – 7.158 of the Panel Report, particularly, paragraphs 7.151, 7.152,
7.153, 7.154, 7.155, 7.156, 7.157 and (c oncluding) 7.158). The Panel Report ignores
the totality of the evidence provided by the European Communities to show the use of
zeroing in this case. For each measure th e European Communities demonstrated that
the methodology was part of the measure, and provided additional evidence over and
above what was required to make a prima facie case. Furthermore, in essence, the
Panel Report is based on the disavowing of documents imputable to the United States
regarding the use of zeroing, and particular ly the disavowing of paper copies or print
runs of electronic documents provided directly by and imputable to the United States,
which documents are expressly referenced in and form part of the measures at issue.
The original documents are held on file by the United States, but the United States
declines to produce or consult the originals. At the same time the United States does
not assert that the documents have been improperly altered by the European
Communities nor did the United States contest the accuracy of any of the relevant
data contained in the copies produced by the European Communities;
• the Panel failed to apply a reasonable bur den of proof (paragraphs 6.5 – 6.20,
particularly paragraph 6.20, of the Panel Report); and
• the Panel made an error when disregardi ng the European Communities' request for
the Panel to ask further information pursuant to Article 13 of the DSU (paragraph
6.20 and footnote 20 of the Panel Report).
Having modified or reversed the Panel's fi ndings, the European Communities requests the
Appellate Body to complete the analysis by finding that each of the seven administrative
review determinations is inconsis tent with Articles VI:2 of the GATT 1994, Articles 2.1, 2.4,

2.4.2, 9.3 and 11.2 of the Anti-Dumping Agreement , and Article XVI:4 of the WTO
Agreement.
(d) The Panel made a legal error when disreg arding the European Communities' requests for
suggestions (paragraph 8.7 of the Panel Repor t) and the European Communities requests the
Appellate Body to modify or reverse the fi ndings in the Panel Report and complete the
analysis by making suggestions pursuant to Article 19.1 of the DSU, such as those requested
by the European Communities in the Panel proceedings, or as otherwise considered
appropriate by the Appellate Body.
The European Communities also makes two conditional appeals.
First, if the Panel Report is construed as findi ng that a panel can invoke "cogent reasons" for
departing from previous Appellate Body findin gs on the same issue of legal interpretation
(paragraphs 7.180 and 7.182 of the Panel Report), then the Eu ropean Communities requests the
Appellate Body to modify or reverse those findings and complete the analysis, for all the reasons set
out by the Appellate Body in its report in US – Stainless Steel from Mexico. The European
Communities considers that a panel may invoke "coge nt reasons" in order to depart from previous
panel findings; but only the Appellate Body can invoke "cogent reasons" in order to depart from
previous Appellate Body findings.
Second, if the United States appeals the findings in paragraphs 7.183 and 8.1(e) of the Panel
Report (particularly as regards what the Panel refers to as "the role of jurisprudence"); and if the
Appellate Body modifies or reverses those findi ngs in whole or in part; then the European
Communities requests the Appellate Body to modify or reverse (and complete the analysis) with
respect to the substantive findings or the exercise of false judicial economy in the Panel Report on the
substantive issue of zeroing in administrative reviews.
1 In such eventuality, the European
Communities submits that the measures are inconsistent with Articles VI:2 of the GATT 1994 ,
Articles 2.1, 2.4, 2.4.2, 9.3 and 11.2 of the Anti-Dumping Agreement, and Article XVI:4 of the WTO
Agreement, for the reasons set out in full in its pleadings before the Panel, and in the separate opinion
(paragraphs 9.1 to 9.10 of the Panel Report).