UNITED STATES – LAWS, REGULATIONS AND METHODOLOGY FOR CALCULATING DUMPING MARGINS ("ZEROING")
Document: Recourse to Article 21.5 of the DSU by the European Communities 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: 17 February 2009
Document codes: WT/DS294/28
Complainant: EU
Respondent: U.S.
Third parties: Argentina, Brazil, China, Taiwan, Hong Kong, India, Japan, South Korea, Mexico, Norway, Thailand, Turkey
Dispute stage: Implementation & Compliance
Agreements cited: Art. 1, 2.1, 2.4, 5.8, 9.1, 9.3, 9.5, 11  Anti-dumpingArt. VI  GATT 1994Art. 18.4  Anti-dumpingArt. XVI:4  Agreement Establishing the World Trade OrganizationArt. 3  Anti-dumping

UNITED STATES – LAWS, REGULATIONS AND METHODOLOGY
FOR CALCULATING DUMPING MARGINS ("ZEROING")

Recourse to Article 21.5 of the DSU by the European Communities

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 13 February 2009, from the Delegation of the European
Commission, 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

Recourse to Article 21.5 of the DSU by the European Communities (). 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 lega l findings and conclusions of the Panel and with
respect to all matters to complete the analysis (whe ther or not this is specifically re-iterated in the
following paragraphs), with respect to the following errors of law and legal interpretations contained
in the Panel Report:
(a) The Panel erred in failing to rule on the substance of the EC claim that the Panel was
composed in a manner inconsistent with Articles 8.3 and 21.5 of the DSU, on the grounds
that it did not have the "authority" to rule on a matter with respect to which, according to the
Panel, the "ultimate power" rests with the Director General of the WTO .
1 The Panel thus
failed to comply with basic requirements of due process and failed to ensure the full and
proper exercise of its judicial function. The Panel also acted inconsistently with the following
provisions of the DSU: Article 1.1 (failure to apply the DSU to a dispute concerning the
DSU); Article 3.2, first sentence (failure to clarify the provisions of the DSU in accordance
with customary rules of interpretation of pub lic international law); Articles 3.2 and 19.2
(failure to ensure that the European Communities' DSU rights were not diminished);
Articles 3.3 and 23.1 (failure to allow for the settlement of the dispute by recourse to the
DSU); Article 7.2 (failure to properly address the relevant provisions of the DSU cited by the
European Communities); Article 11 (failure to make such other findings as would assist the

1Panel Report, paras. 8.13–8.17 and 9.1(a).

DSB); and Article 12.7 (failure to set out th e basic rationale behind its findings). The
European Communities requests the Appellate Body to modify or reverse the Panel's findings
and complete the analysis by finding that the Panel was composed inconsistently with
Articles 8.3 and 21.5 of the DSU. One panellist remained in office at the stage of the
compliance panel and was not lawfully removed by the United States or by the Director
General of the WTO. The European Communities also requests the Appellate Body to
reverse the Panel's finding that, if it would ha ve agreed with the European Communities, it
would have been compelled to rule that it had no jurisdiction to rule on any of the EC
claims.
2
(b) The Panel made errors relating to the legal in terpretation of Articles 19.1, 21.3 and 21.5 of the
DSU,3 and failed to comply with its functions as required by Articles 7 and 11 of the DSU
when excluding certain subsequent reviews listed in the Annex to the EC Compliance Panel
Request from its terms of reference.4 In particular, the European Communities claims that:
• the Panel erred in rejecting the EC claim that the subsequent reviews listed in the
Annex to the EC Compliance Panel Request fell under its terms of reference because
they were "amendments" to the measures at issue in the original dispute;5
• the Panel erred in failing to examine or properly examine whether the US omissions
and deficiencies in the US implementation of the DSB recommendations and rulings
fell under its terms of reference;6 and
• the Panel erred in excluding certain subsequent reviews from its terms of reference on
the basis that they did not have a close nexus with the measures at issue in the original
dispute and the DSB recommendations and rulings in view of their timing.7
The European Communities requests the Appellate Body to modify or reverse the Panel's
findings, and to complete the analysis by finding that, in relation to these matters, the United
States failed to comply with the relevant provis ions of the covered agreements cited in the
pleadings before the Panel and with the ruli ngs and recommendations of the DSB in the
original proceedings.
(c) The Panel erred in finding that the Europ ean Communities had not demonstrated that the
United States failed to comply with the DSB r ecommendations and rulings in the subsequent
sunset reviews at issue. 8 This conclusion was based on e rroneous findings on issues of law
and related legal interpretations of Articles 19.1, 21.3 and 21.5 of the DSU. Furthermore, the
Panel disregarded its mandate and failed to comply with its functions as required by
Article 11 of the DSU when failing to address the EC claim that the United States failed to
comply with the DSB recommendations in the orig inal dispute, since certain aspects of the
measures at issue in the original dispute ( i.e., the dumping margins based on zeroing)

2Panel Report, para. 8.13.
3All EC claims and arguments referring to Articles 19.1, 21.3 or 21.5 of the DSU are to be considered
in the context of Article 3.7 of the DSU.
only referring to certain subsequent reviews) and para. 9.1(b) (by omission and by implication, only referring to
certain subsequent reviews).
5Panel Report, paras. 8.61–8.84 and para. 9.1(b) (by omission and by implication).
6Panel Report, paras. 8.85–8.86, para. 8.127 (by omission and by implication) and para. 9.1(b) (by
omission and by implication).
7Panel Report, paras. 8.111–8.116, 8.119–8.124, 8.126 (by omission and by implication) and 9.1(b) (by
omission and by implication).
8Panel Report, paras. 8.135–8.141 and 9.1(b)(vi).

remained in place ( i.e., the United States relied on those margins for the determination of
likelihood of recurrence of dumpi ng in subsequent sunset review proceedings concerning the
same anti-dumping "measure").9 The European Communities requests the Appellate Body to
complete the analysis and find that the United St ates acted inconsistently with Articles 2.1,
2.4, 2.4.2 and 11.3 of the Anti-Dumping Agreement and Articles 19.1 and 21.3 of the DSU,
and failed to comply with the DSB rulings and recommendations in the original proceedings.
(d) The Panel erred in rejecting the EC claims that certain US actions or omissions based on
zeroing after the expiry of th e reasonable period of time were inconsistent with the US
obligation and public commitment to immediately comply with the rulings and
recommendations of the DSB, and with vari ous provisions of Article VI of the GATT 1994,
the Anti-Dumping Agreement and the DSU.
10 In particular, the European Communities
requests the Appellate Body:
• with respect to all cases, to modify or reverse the Panel's finding that assessment
instructions and final liquidations after th e end of the reasonable period of time and
within the scope of the compliance panel, based on zeroing, are not inconsistent with
Article VI:2 of the GATT 1994 and Article 9.3 of the Anti-Dumping Agreement (with
respect to administrative reviews), Articles 2.1, 2.4, 2.4.2 and 11.3 of the Anti-
Dumping Agreement (with respect to sunset reviews) and Articles 2.4 and 2.4.2 of the
Anti-Dumping Agreement (with respect to original investigations) and do not
constitute a failure to comply with the rulings and recommendations of the DSB in the
original case.11 The European Communities requests the Appellate Body to complete
the analysis, finding that assessment instructi ons or final liquidations after the end of
the reasonable period of time and within th e scope of the compliance panel, based on
zeroing, are inconsistent with the above pr ovisions and with Articles 19.1 and 21.3 of
the DSU, and constitute a failure to comply w ith the rulings and recommendations of
the DSB in the original proceedings;
• with respect to Case 1 ( Hot Rolled Carbon Steel from the Netherlands ), to uphold the
Panel's finding that the 2004-2005 administrative review and assessment instructions
(by action or omission) were incons istent with Article VI:2 of the GATT 1994 and
Article 9.3 of the Anti-Dumping Agreement and a failure to comply with the DSB
rulings and recommendations, 12 albeit on the basis of the different and more
developed reasoning to be set out in the app eal; and to find that the Panel erred in
failing to specifically address the same issue with respect to the final liquidations (by
action or omission) 13 and erred in its other findings on this issue, 14 and to complete
the analysis by making the same findings as for the administrative review and
assessment instructions;
• also with respect to Case 1 ( Hot Rolled Carbon Steel from the Netherlands ), to
modify or reverse the Panel's findings and conclusions
15 concerning the assessment

9Panel Report, para. 8.222.
10Panel Report, paras. 8.164–8.222 and 9.1(b)(i)-(v).
11Panel Report, paras. 8.191–8.193, particularly (but not only) para. 8.191, first sentence, referring to
paras. 8.170–8.185, particularly (but not only) para. 8.174, first sentence (including footnote 769); re-iterated at
paras. 8.199–8.200 (including footnote 803); and Panel Report, para. 9.1(b)(iii) and (iv) and 9.1 (by omission
and by implication).
12Panel Report, paras. 8.208 and 9.1(b)(i).
13Panel Report, paras. 8.208 and 9.1(b)(i) (by omission and by implication).
14Panel Report, para. 9.1(b)(iii) and (iv).
15Panel Report, paras. 8.205, 8.209 and 9.1(b)(iii) and (iv).

instructions on 16 April 2007 and the li quidation instructions on 23 April 2007,
instructing liquidation for the period 1 N ovember 2005 to 31 October 2006, on the
basis of the cash deposit rate originally in force at the time of importation, and based
on zeroing. The European Communities request s the Appellate Body to complete the
analysis and find that these actions by the United States after the end of the reasonable
period of time were inconsistent with Article VI:2 of the GATT 1994, Article 9.3 of
the Anti-Dumping Agreement and Articles 19.1 and 21.3 of the DSU, and constitute a
failure to comply with the rulings and r ecommendations of the DSB in the original
case;
• with respect to Case 6 ( Stainless Steel Wire Rod from Sweden ), to uphold the Panel's
finding that the 2004-2005 administrative review and assessment instructions (by
action or omission) were inconsis tent with Article VI:2 of the GATT 1994 and
Article 9.3 of the Anti-Dumping Agreement,
16 albeit on the basis of the different and
more developed reasoning to be set out in th e appeal; and to find that the Panel erred
in failing to specifically address the same i ssue with respect to the final liquidations
(by action or omission) 17 and erred in its other findings on this issue, 18 and to
complete the analysis by making the same findings as for the administrative review
and assessment instructions;
• with respect to 12 Cases, 19 to modify or reverse the erroneous findings in paragraph
8.202 of the Panel Report; to uphold the corr ect findings in the final two sentences of
paragraph 8.218 of the Panel Report; to find that the Panel has acted inconsistently
with Article 11 of the DSU; and to the extent necessary, to complete the analysis, also
with respect to the appropriate conclusions and recommendations, by finding that, by
continuing to maintain in place duty or ca sh deposit rates with respect to these 12
Cases, the United States acted inconsis tently with Article VI:2 of the GATT 1994 ,
Article 9.3 of the Anti-Dumping Agreement (or in the case of sunset reviews with
Articles 2.1, 2.4, 2.4.2 and 11.3 of the Anti-Dumping Agreement ) and Articles 19.1
and 21.3 of the DSU, and that this constitutes a failure to comply with the rulings and
recommendations of the DSB in the original case; and
• to modify or reverse the Panel's findings re jecting the EC claim according to which,
once an anti-dumping order is revoked pursu ant to the Section 129 Determination
(because absent zeroing no dumping was found) the United States was not entitled to
continue adopting administrative reviews a nd other actions (including collection of
duties) based on zeroing in relation to that revoked order after the end of the
reasonable period of time; and to complete the analysis accordingl y by finding that
the United States violated Articles 19.1 and 21.3 of the DSU and the DSB rulings and
recommendations in the original proceedings.
20
(e) The Panel erred with respect to the correct le gal interpretations of Articles 19.1, 21.3 and 21.5
of the DSU, disregarded its mandate, exercised false judicial economy, and failed to comply
with its functions as required by Article 11 of the DSU when failing to make any findings
with respect to the EC claims regarding the non-existence of measures taken to comply
between 9 April and 23 April/31 August 2007 .21 The European Communities requests the

16Panel Report, paras. 8.213 and 9.1(b)(i).
17Panel Report, paras. 8.213 and 9.1(b)(i) (by omission and by implication).
18Panel Report, para. 9.1(b)(iii).
19Cases 18-24, 27-30 and 31.
20Panel Report, paras. 8.219–8.222, particularly (but not only) para. 8.222, final sentence.
21Panel Report, paras. 8.226–8.227 and 9.1(b)(vii).

Appellate Body to complete the analysis by fi nding that the United States acted inconsistently
with Articles 19.1 and 21.3 of the DSU and failed to comply with the DSB rulings and
recommendations in the original proceedings.
(f) The Panel made errors relating to the le gal interpretation of Article 21.5 of the DSU when
finding that the EC claims (particularly regarding the arithmetical error ) in respect of the
Section 129 Determination concerning Stainless Steel Sheet and Strip in Coils from Italy
(listed as Case 11 in the Annex to the EC Panel Request) were not properly before the Panel.22
The European Communities requests the Appellate Body to complete the analysis by finding
that the EC claims could properly be made in these compliance proceedings and that the
United States acted inconsistently with Articles 2, 5.8, 6.8, 9.3, 11.1 and 11.2 of the Anti-
Dumping Agreement, Article VI:2 of the GATT 1994, Articles 19.1 and 21.3 of the DSU and
failed to comply with the DSB rulings and recommendations in the original proceedings.
(g) The Panel erred in finding that the United Stat es did not act inconsistently with Article 9.4 of
the Anti-Dumping Agreement in the establishment of "all others" rates
 in the Section 129
Determinations concerning Stainless Steel Bar from France, Italy and the United Kingdom
(listed as Cases 2, 4 and 5 in the Anne x to the EC Compliance Panel Request); 23 moreover,
the Panel erred in failing to examine the EC claim based on Article 6.8 and Annex II of the
Anti-Dumping Agreement .24 The European Communities requests the Appellate Body to
complete the analysis by finding that the United States acted inconsistently with Article 9.4 of
the Anti-Dumping Agreement , Article 6.8 and Annex II of the Anti-Dumping Agreement ,
Articles 19.1 and 21.3 of the DSU and failed to comply with the DSB rulings and
recommendations in the original proceedings.
(h) The Panel erred in rejecting the EC request for a suggestion pursuant to Article 19.1 of the
DSU,25 and the European Communities requests th e Appellate Body to make appropriate
suggestions in this case.

22Panel Report, paras. 8.237–8.244 and 9.1(c)(i).
23Panel Report, paras. 8.278–8.284 and 9.1(c)(iii).
24Panel Report, paras. 8.284 and 9.1 (by omission and by implication).
25Panel Report, para. 9.3.