UKRAINE – DEFINITIVE SAFEGUARD MEASURES ON CERTAIN PASSENGER CARS REQUEST FOR CONSULTATIONS BY JAPAN
Document: REQUEST FOR CONSULTATIONS BY
Date: 4 November 2013
Document codes: WT/DS468/1; G/L/1055; G/SG/D46/1
Complainant: Japan
Respondent: Ukraine
Third parties: EU, India, South Korea, Russia, Turkey, Australia, U.S.
Dispute stage: Panel
Agreements cited: Art. 12.1, 12.2, 12.3, 12.5, 8.1, 3.1, 4.2(c), 2.1, 11.1(a), 5.1, 7.1, 7.4, 4.2(a), 4.2(b), 4.1(a), 4.1(b)  SafeguardsArt. X:3(a), XIX:1, II:1(b)  GATT 1994

UKRAINE – DEFINITIVE SAFEGUARD MEASURES ON CERTAIN PASSENGER CARS
REQUEST FOR CONSULTATIONS BY JAPAN
The following communication, dated 30 October 2013, from the delegation of Japan to the
delegation of Ukraine and to the Chairperson of the Dispute Settlement Body, is circulated in
accordance with Article 4.4 of the DSU.

 My authorities have instructed me to request consultations with the Government of Ukraine
pursuant to Article 4 of the Understanding on Rules and Procedures Governing the Settlement of
Disputes ("DSU"), Article XXII:1 of the General Agreement on Tariffs and Trade 1994 (the
"GATT 1994") and Article 14 of the Agreement on Safeguards regarding the definitive safeguard
measures imposed by Ukraine on imports of certain passenger cars and the investigation that led
to the imposition of those measures.

On 30 June 2011, the Inter-Departmental Commission for International Trade (hereinafter
referred to as "the Commission") adopted decision No. SP-259/2011/4402-27 whereby it initiated
an investigation with a view to the application of safeguard measures on imports of certain
passenger cars to Ukraine regardless of their country of origin or their country of export. The
Commission decision was taken further to a complaint lodged by the Association of Ukrainian
Vehicle Manufacturers "UkrAvtoprom" on behalf of three Ukrainian automobile manufacturers. The
Commission decision of initiation was published in the "Uryadoviy Kuryer" No. 118 of 2 July 2011.
On 28 April 2012, the Commission approved decision No. SP-275/2012/4423-08 (hereinafter
referred to as the "Decision") according to which safeguard measures would be imposed on
imports of the product concerned to Ukraine, in the form of the following two additional duties:

- for cars of a cylinder capacity exceeding 1000 cm
3 but not exceeding 1500 cm 3:
6.46%

- for cars of a cylinder capacity exceeding 1500 cm 3 but not exceeding 2200 cm 3:
12.95%

The product concerned involved motor cars and other motor vehicles principally designed for
the transport of persons (category M1 – vehicles with no less than 4 wheels and no more than
8 sitting places except driver sitting place), with spark-ignition internal combustion engine and
crank gear of a cylinder capacity exceeding 1000 cm3 but not exceeding 2200 cm3, new, classified
under UKTZED codes 8703 22 10 00 and 8703 23 19 10.

The Notice concerning the Decision was published in the "Uryadoviy Kuryer" No. 48 on
14 March 2013.

These measures entered into force 30 days after the Notice's publication. It provides for a
duration of the measures of three years.

By decision No. SP-288/2013/4423-06 adopted on 11 April 2013, the safeguard measures
have been amended so as to provide for the temporary non-application of the special measures to
cars which have hybrid propulsion unit (electric motor with a drive on vehicle wheels). The decision
WT/DS468/1 • G/L/1055 • G/SG/D46/1

has been published in the "Uryadoviy Kurye r" No. 75 of 20 April 2013 and applies from
20 April 2013 until 28 February 2014.

Japan is deeply concerned about the safegu ard measures imposed by Ukraine and the
underlying investigation that led to the imposition of those measures. Specifically, Japan considers
that:

(1) Ukraine failed to comply with Articles 12.1 and 12.2 of the Agreement on Safeguards
which directs Members to immediately notify the Committee on Safeguards of all
safeguard actions and with Article 12.3 of the Agreement on Safeguards which directs
Members to provide adequate opportunity for prior consultations with Members having
a substantial export interest of the product concerned.

(2) Ukraine failed to comply with Article 8.1 of the Agreement on Safeguards since it did
not endeavour to maintain a substantially equivalent level of concessions and other
obligations to that existing under the GA TT 1994 between it and Japan in accordance
with Article 12.3 of the Agreement on Safeguards.

(3) Ukraine failed to publish a report setting forth its findings and reasoned conclusions
reached on all pertinent issues of fact and law and a detailed analysis of the case
under investigation as well as a demonstration of the relevance of the factors
examined, thereby acting inconsistently with Article 3.1 and Article 4.2(c) of the
Agreement on Safeguards.

(4) Ukraine applied the safeguard measures two years after the end of the investigation
period, thereby acting inconsistently with Article 2.1, Article 3.1, and Article 4.2(c) of
the Agreement on Safeguards and Article XIX:1(a) of the GATT 1994.

(5) Ukraine imposes the safeguard measures beyond the extent necessary to prevent or
remedy serious injury and to facilitate adjustment as it did not provide for a
progressive liberalization, inter alia , in its determination and its WTO notification, at
regular intervals during the period of application, thereby acting inconsistently with
Articles 3.1, 4.2(c), 5.1, 7.1, 7.4 and 12.2 of the Agreement on Safeguards and
Article XIX:1(a) of the GATT 1994.

(6) Ukraine failed to make reasoned and adequate findings and conclusions in its
determination with respect to the alleged unforeseen developments and explanation of
how those alleged unforeseen developments resulted in increased imports of the
specific products covered by the safe guard measures. Therefore Ukraine acts
inconsistently with Articles 3.1, 4.2(c) and 11.1(a) of the Agreement on Safeguards
and with Article XIX:1(a) of the GATT 1994.

(7) Ukraine failed to make reasoned and adequate findings and conclusions in its
determination as to the alleged effect of obligations incurred under the GATT 1994,
and how that effect has resulted in increased imports of the specific products covered
by the safeguard measures. Therefore Ukraine acts inconsistently with Articles 3.1,
4.2(c) and 11.1(a) of the Agreement on Safeguards and with Article XIX:1(a) of the
GATT 1994.

(8) Ukraine failed to make reasoned and adequate findings and conclusions in its
determination with respect to the alleged increase in imports of the specific products
under investigation, in absolute terms or relative to domestic production. Therefore
Ukraine acts inconsistently with Articles 2.1, 3.1, 4.2(a), 4.2(c) and 11.1(a) of the
Agreement on Safeguards and Article XIX:1(a) of the GATT 1994.

(9) Ukraine failed to make reasoned and adequate findings and conclusions in its
determination as to the existence of an alleged serious injury and/or threat of serious
injury. Therefore Ukraine acts inconsistently with Articles 2.1, 3.1, 4.1(a), 4.1(b),
4.2(a), 4.2(b) and 4.2(c) of the Agreement on Safeguards and Article XIX:1(a) of the
GATT 1994.
WT/DS468/1 • G/L/1055 • G/SG/D46/1

(10) Ukraine failed to make reasoned and adequate findings and conclusions in its
determination as to the causal link between the alleged increase in imports and the
alleged serious injury and/or threat of serious injury of the domestic industry.
Therefore Ukraine acts inconsistently with Articles 2.1, 3.1, 4.1(a), 4.1(b), 4.2(a),
4.2(b) and 4.2(c) of the Agreement on Safeguards and Article XIX:1(a) of the
GATT 1994.

(11) Through the safeguard measures, Ukraine imposes duties which are in excess of those
set forth in its schedule, thereby violating Article II:1(b) of the GATT 1994.

The Government of Japan reserves the right to raise additional factual claims and legal
matters during the course of the consultations.

We look forward to receiving your reply to this request for consultations and to agreeing
upon a mutually acceptable date for the consultations.