PERU - ANTI-DUMPING AND COUNTERVAILING MEASURES ON BIODIESEL FROM ARGENTINA REQUEST FOR CONSULTATIONS BY ARGENTINA
Document: REQUEST FOR CONSULTATIONS BY
Date: 6 September 2022
Document codes: WT/DS614/1; G/L/1432; G/ADP/D141/1; G/SCM/D134/1
Complainant: Argentina
Respondent: Peru
Dispute stage: Consultation
Agreements cited: Art. 2.2, 2.2.1.1, 2.2.2(iii), 3.1, 3.2, 3.4, 3.5, 5.3, 6.8, 9.3, 11.1, 11.2, 11.3, 11.4, 18.1, 18.4, Annex II  Anti-dumpingArt. VI:1, VI:2(a), VI:3, VI:5(a), VI:6  GATT 1994Art. 10, 14, 14(d), 15.1, 15.5, 19.1, 19.4, 21.1, 21.2, 21.3, 21.4, 32.1, 32.5  Subsidies and Countervailing Measures (SCM)Art. XVI:4  Agreement Establishing the World Trade Organization

PERU - ANTI-DUMPING AND COUNTERVAILING MEASURES
ON BIODIESEL FROM ARGENTINA
REQUEST FOR CONSULTATIONS BY ARGENTINA
The following communication, dated 2 September 2022, from the delegation of Argentina to the
delegation of Peru, is circulated to the Dispute Settlement Body in accordance with Article 4.4 of the
DSU.

My authorities have instructed me to request consultations with the Republic of Peru pursuant to
Articles 1 and 4 of the Understanding on Rules and Procedures Governing the Settlement of Disputes
("DSU"), Article XXIII:1 of the General Agreement on Tariffs and Trade 1994 (" GATT 1994 "),
Articles 17.2 and 17.3 of the Agreement on Implementation of Article VI of the General Agreement
on Tariffs and Trade 199 4 (" Anti-Dumping Agreement ") and Article 30 of the Agreement on
Subsidies and Countervailing Measures ("SCM Agreement") with respect to the anti-dumping and
countervailing measures on imports of biodiesel (B100) originating in the Argentine Republic.

I.- Identification of the measures at issue

The anti -dumping and countervailing measures concerned are contained in the following
instruments:

Measure 1: Imposition of definitive countervailing duties (original investigation).

● Resolution No. 011-2016/CDB-INDECOPI, published in the Official Journal El Peruano on
28 January 2016, which, on the basis of the conclusions of Report
No. 007-2016/CDB-INDECOPI, stipulates the imposition of definitive countervailing duties
on imports of biodiesel (B100) originating in Argentina, confirmed by Resolution
No. 0144-2018/SDC-INDECOPI, published in the Official Journal El Peruano on 27 July 2018,
and the underlying investigation, including the notice of initiation (Resolution
No. 081-2014/CFD-INDECOPI, published in the Official Journal El Peruano on 28 July 2014).

Measure 2: Imposition of definitive anti-dumping duties (original investigation).

● Resolution No. 189 -2016/CDB-INDECOPI, published in the Official Journal El Peruano on
25 October 2016, which stipulates the imposition of definitive anti -dumping duties on
imports of biodiesel (B100) originating in the Argentine Republic, confirmed by Resolution
No. 0145-2018/SDC-INDECOPI, published in the Official Journal El Peruano on 27 July 2018,
and the underlying investigation, including the notice of initiation (Resolution
No. 050-2015/CFD-INDECOPI, published in the Official Journal El Peruano on 26 April 2015).

These measures also include the final determinations in the changed circums tances and sunset
reviews carried out by the Peruvian investigating authority, which are contained in:

Measure 3: Continued imposition of countervailing duties (changed circumstances review).

● Resolution No. 187 -2021/CDB-INDECOPI, published in the Offic ial Journal El Peruano on
16 June 2021, which extends the validity of the countervailing duties imposed by Resolution
No. 011-2016/CDB-INDECOPI, confirmed by Resolution No. 144-2018-SDC-INDECOPI, on
imports of biodiesel (B100) originating in Argentina, and the underlying review process,
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including the notice of initiation (Resolution No. 165-2019/CDB-INDECOPI, published in the
Official Journal El Peruano on 11 December 2019).

Measure 4: Continued imposition of anti-dumping duties (changed circumstances review).

● Resolution No. 182 -2021/CDB-INDECOPI, published in the Official Journal El Peruano on
2 June 2021, which extends the validity of the definitive anti -dumping duties imposed by
Resolution No. 189 -2016/CDB-INDECOPI on imports of biodiesel (B100) originating in the
Argentine Republic, and the underlying review process, including the notice of initiation
(Resolution No. 166 -2019/CDB-INDECOPI, published in the Official Journal El Peruano on
11 December 2019).

Measure 5: Continued imposition of countervailing duties (sunset review).

● Resolution No. 265 -2021/CDB-INDECOPI, published in the Official Journal El Peruano on
3 November 2021, which extends for five years the countervailing duties imposed by
Resolution No. 011 -2016/CDB-INDECOPI on imports of biodiesel (B100) originating in
Argentina, and the underlying review process, including the notice of initiation (Resolution
No. 104 -2020/CDB-INDECOPI, published in the Official Journal El Peruano on
10 September 2020).

Measure 6: Continued imposition of anti-dumping duties (sunset review).

● Resolution No. 266 -2021/CDB-INDECOPI, published in the Official Journal El Peruano on
3 November 2021, which extends the validity of the definitive anti-dumping duties imposed
by Resolution No. 189 -2016/CDB-INDECOPI on imports of biodiesel (B100) originating in
the Argentine Republic, and the underlying review process, including the notice of initiation
(Resolution No. 105 -2020/CDB-INDECOPI, published in the Official Journal El Peruano on
10 September 2020).

These measures also include any annexes and amendments thereto, and the initiation and
conduct of the underlying investigations that led to their publication.

II.- Legal basis

 Measure 1 (Imposition of definitive countervailing duties - Original investigation) appears to
be inconsistent with Peru's obligations under the WTO Agreements, including those under the
provisions of the SCM Agreement and the GATT 1994. Specifically, Peru appears to have violated
the following:

1. The introductory paragra ph of Article 14 of the SCM Agreement because the
method used by Peru to calculate the benefit to the recipient was not provided for in
Peru's legislation or implementing regulations.

2. Article 14(d) of the SCM Agreemen t and, therefore, Article 19.4 of t he
SCM Agreement and Article VI:3 of the GATT 1994 , because Peru improperly
calculated the amount of subsidization in terms of the benefit to the recipient due to,
inter alia, its failure to determine the adequacy of remuneration in relation to prevailing
conditions in the Argentine biodiesel market. As a result, Peru's miscalculation of the
alleged benefit to Argentine exporters led it to impose countervailing duties that are
higher than necessary to counteract the alleged subsidization.

3. Articles 15.1 and 15.2 of the SCM Agreement because, with regard to the effect of
the allegedly subsidized imports on prices, the analysis carried out by Peru was not
based on positive evidence and did not involve an objective examination and, therefore,
it improp erly found significant price undercutting and price suppression within the
meaning of Article 15.2.

4. Articles 15.1 and 15.5 of the SCM Agreement because, with regard to the
demonstration of a causal relationship, Peru failed to carry out an objective examination
based on positive evidence of factors other than the allegedly subsidized imports which
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were injuring the domestic industry and, consequently, it improperly attributed the
injury caused by those other factors to imports of biodiesel from Argentina.

5. Articles 10, 19.1 and 32.1 of the SCM Agreement and Article VI:6(a) of the
GATT 1994 because Peru imposed countervailing duties not in conformity with the
provisions of those Agreements.

6. Article XVI:4 of the Marrakesh Agreement Establishing the World Trade
Organization and Article 32.5 of the SCM Agreement because Peru failed to take all
necessary steps to ensure that the administrative procedures that led to the imposition
of the countervailing duties on biodiesel originating in Argentina were in conformity with
the provisions of those Agreements.

Measure 2 (Imposition of definitive anti-dumping duties - Original investigation) appears
to be inconsistent with Peru's obligations under the WTO Agreements, including those under the
provisions of the Anti -Dumping Agreement and the GATT 1994. Specifically, Peru appears to have
violated the following:

1. Article 5.3 of the Anti -Dumping Agreement because Peru failed to examine the
accuracy and adequacy of the evidence provided in the application to determine whether
it was sufficient to justify the initiation of an anti-dumping investigation.

2. The first sentence of Article 2.2.1.1 of the Anti-Dumping Agreement because, by
including costs not associated with the production and sale of the product under
consideration, Peru failed to calculate costs on the basis of the records of the exporters
under investigation . Furthermore, with regard to the second sentence of
Article 2.2.1.1 of the Anti-Dumping Agreement, Peru failed to consider all available
evidence on the proper allocation of costs when calculating an amount for administrative,
selling and general costs. As a result, Peru violated Article 2.2 of the
Anti-Dumping Agreement, because it failed to determine the margin of dumping by a
proper comparison with the cost of production in the country of origin plus a reasonable
amount for administrative, selling and general costs and for profits.

3. Article 2.2.2(iii) of the Anti-Dumping Agreement and, therefore, Article 2.2 of the
Anti-Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994 because Peru
failed to use a reasonable method to calculate the amount for profit.

4. Article 2.2.2(iii) of the Anti-Dumping Agreement and, therefore, Article 2.2 of the
Anti-Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994 because Peru
failed to ensure that the margin determined for profit did not exceed the profit normally
realized by other exporters or producers on sales of products of the same general
category in the domestic market of the country of origin.

5. Article VI:2 of the GATT 1994 and Article 9.3 of the Anti -Dumping Agreement
because Peru imposed anti -dumping duties in excess of the margin of dumping that it
should have established under Article 2 of the Anti-Dumping Agreement.

6. Article 3.1 and 3.2 of the Anti -Dumping Agreement because, with regard to the
effect of the allegedly dumped imports on prices, the analysis carried out by Peru was
not based on positive evidence and did not involve an obje ctive examination and,
therefore, it improperly found significant price undercutting, price suppression and price
depression within the meaning of Article 3.2.

7. Article 3.1 and 3.4 of the Anti -Dumping Agreement because, with regard to the
impact of the allegedly dumped imports on the domestic industry, Peru's analysis did not
involve an objective examination as it failed to include an adequate evaluation of all
factors having a bearing on the state of the domestic industry.

8. Article 3.1 and 3.5 of th e Anti-Dumping Agreement because, with regard to the
demonstration of a causal relationship, Peru failed to carry out an objective examination
based on positive evidence of factors other than the allegedly dumped imports which
WT/DS614/1 • G/L/1432 • G/ADP/D141/1 • G/SCM/D134/1

were injuring the domestic industry and, consequently, it improperly attributed the injury
caused by those other factors to imports of biodiesel from Argentina.

9. Article 18.1 of the Anti -Dumping Agreement because Peru imposed anti -dumping
duties in violation of the provisions of that Agreement.

10. Article VI:5 of the GATT 1994 because Peru imposed both anti -dumping and
countervailing duties on the same product to compensate for the same situation of alleged
dumping and subsidization.

11. Article XVI:4 of the Marrakesh Agreement Establishing the World Trade
Organization and Article 18.4 of the Anti -Dumping Agreement because Peru failed
to take all necessary steps to ensure that the administrative procedur es that led to the
imposition of the anti -dumping duties on biodiesel originating in Argentina were in
conformity with the provisions of those Agreements.

Measure 3 (Continued imposition of countervailing duties - Changed circumstances review)
appears to be inconsistent with Peru's obligations under the WTO Agreements, including those under
the provisions of the SCM Agreement and the GATT 1994. Specifically, Peru appears to have violated
the following:

1. Article 21.2 of the SCM Agreement and, therefore, Article 21.1 of that Agreement
because Peru improperly reviewed the need for the continued imposition of the duty to
offset the alleged subsidy, as it failed to make a determination based on a sufficient
factual basis to allow it to draw reasoned and adequ ate conclusions concerning the
likelihood of recurrence or continuation of subsidization and injury. Consequently, Peru
failed to ensure that the countervailing duties remained in force only as long as and to
the extent necessary to counteract the alleged subsidization.

2. Second sentence of Article 21.4 of the SCM Agreement because Peru failed to carry
out the changed circumstances review expeditiously and to conclude it within the normal
12-month period provided for in that Article, without any abnormal circumstances that
would justify such non-compliance.

3. Article 32.1 of the SCM Agreement because Peru continued to impose countervailing
duties in violation of the provisions of that Agreement.

4. Article XVI:4 of the Marrakesh Agreement Establishing the World Trade
Organization and Article 32.5 of the SCM Agreement because Peru failed to take all
necessary steps to ensure that the administrative procedures that led to the continued
imposition of the countervailing duties on biodiesel originating in Argentina were in
conformity with the provisions of those Agreements.

Measure 4 (Continued imposition of anti-dumping duties - Changed circumstances review)
appears to be inconsistent with Peru's obligations under the WTO Agreements, including those under
the provisions of the Anti -Dumping Agreement and the GATT 1994. Specifica lly, Peru appears to
have violated the following:

1. Article 11.2 of the Anti-Dumping Agreement and, therefore, Article 11.1 of that
Agreement because Peru improperly reviewed the need for the continued imposition of
the duty to offset the alleged dumping, as it failed to make a determination based on a
sufficient factual basis to allow it to draw reasoned and adequate conclusions concerning
the likelihood of recurrence or continuation of dumping and injury. Consequently, Peru
failed to ensure that the ant i-dumping duties remained in force only as long as and to
the extent necessary to counteract the alleged dumping.

2. Article 6.8 and Annex II of the Anti -Dumping Agreement, through Article 11.4
of the that Agreement (first sentence) , because Peru made det erminations
improperly on the basis of the facts available ("best information available"), when the
requirements of Article 6.8 and Annex II of the Anti -Dumping Agreement had not been
met. Specifically, and among other issues, (a) Peru failed to take into account verifiable
information that was appropriately submitted in a timely fashion by the Argentine
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companies (paragraph 3 of Annex II); (b) Peru did not immediately inform the
Argentine companies of the reasons for rejecting the evidence and information supplied
by the authorities or provide them with an opportunity to provide further explanations
within a reasonable period (paragraph 6 of Annex II); and (c) Peru did not use special
circumspection when basing its conclusions on information from a secondary source as,
inter alia, it failed to check the accuracy of the secondary source information used by
comparing it to the information obtained from the Argentine exporters (paragraph 7 of
Annex II).

3. Second sentence of Article 11.4 of the Anti -Dumping Agreement because Peru
failed to carry out the changed circumstances review expeditiously and to conclude it
within the normal 12 -month period provided for in that Article, without any abnormal
circumstances that would justify such non-compliance.

4. Article 18.1 of the Anti -Dumping Agreement because Peru continued to impose
anti-dumping duties in violation of the provisions of that Agreement.

5. Article XVI:4 of the Marrakesh Agreement Establishing the World Trade
Organization and Article 18.4 of the Anti-Dumping Agreement because Peru failed
to take all necessary steps to ensure that the administrative procedures that led to the
continued imposition of the anti -dumping duties on biodiesel originating in Argentina
were in conformity with the provisions of those Agreements.

Measure 5 (Continued imposition of countervailing duties - Sunset review) appears to be
inconsistent with Peru's obligations under the WTO Agreements, including those under the provisions
of the SCM Agreement and the GATT 1994. Specifically, Peru appears to have violated the following:

1. Article 21.3 of the SCM Agreement and, therefore, Article 21.1 of that Agreement
because Peru did not terminate the definitive countervailing duties imposed on
Argentine biodiesel exports, despite the passing of five years since the date of their
imposition, as it failed to make a determination based on a sufficient factual basis to
allow it to draw reasoned and adequate conclusions concerning the likelihood of
recurrence or continuation of subsidiz ation and injury. Consequently, Peru failed to
ensure that the countervailing duties remained in force only as long as and to the extent
necessary to counteract the alleged subsidization.

2. Second sentence of Article 21.4 of the SCM Agreement because Peru failed to
carry out the sunset review expeditiously and to conclude it within the normal
12-month period provided for in that Article, without any abnormal circumstances that
would justify such non-compliance.

3. Article 32.1 of the SCM Agreement because Peru continued to impose countervailing
duties in violation of the provisions of that Agreement.

4. Article XVI:4 of the Marrakesh Agreement Establishing the World Trade
Organization and Article 32.5 of the SCM Agreement because Peru failed to take all
necessary steps to ensure that the administrative procedures that led to the continued
imposition of the countervailing duties on biodiesel originating in Argentina were in
conformity with the provisions of those Agreements.

Measure 6 (Continued imposition of anti -dumping duties - Sunset review) appears to be
inconsistent with Peru's obligations under the WTO Agreements, including those under the provisions
of the Anti-Dumping Agreement and the GATT 1994. Specifically, Peru appears to have violated the
following:

1. Article 11.3 of the Anti-Dumping Agreement and, therefore, Article 11.1 of that
Agreement because Peru did not terminate the definitive anti-dumping duties imposed
on Argentine biodiesel exports, despite the passing of five years since the date of their
imposition, as it failed to make a determination based on a sufficient factual basis to
allow it to draw reasoned and adequate conclusions concerning the likelihood of
recurrence or continuation of dumping and injury. Consequently, Peru failed to ensure
WT/DS614/1 • G/L/1432 • G/ADP/D141/1 • G/SCM/D134/1

that the anti -dumping duties remained in force only as long as and to the extent
necessary to counteract the alleged dumping.

2. Second sentence of Article 11.4 of the Anti -Dumping Agreement because Peru
failed to carry out the sunset review expeditiously and to conclude it within the normal
12-month period provided for in that Article, without any abnormal circumstances that
would justify such non-compliance.

3. Article 18.1 of the Anti -Dumping Agreement because Peru continued to impose
anti-dumping duties in violation of the provisions of that Agreement.

4. Article XVI:4 of the Marrakesh Agreement Establishing the World Trade
Organization and Article 18.4 of the Anti-Dumping Agreement because Peru failed
to take all necessary steps to ensure that the administrative procedures that led to the
continued imposition of the anti -dumping duties on biodiesel originating in Argentina
were in conformity with the provisions of those Agreements.

Peru's measures appear to nullify or impair the benefits accruing to Argentina, directly or indirectly,
under the cited Agreements.

Argentina reserves the right to address additional measures and claims under other provisions of
the WTO Agreement regarding the above matters during the course of the consultations.

I look forward to receiving your reply to this request and to setting a mutually convenient date for
these consultations.