UNITED STATES – CERTAIN METHODOLOGIES AND THEIR APPLICATION TO ANTI-DUMPING PROCEEDINGS INVOLVING CHINA RECOURSE TO ARTICLE 22.6 OF THE DSU BY THE UNITED STATES DECISION BY THE ARBITRATOR
Document: DECISION BY THE ARBITRATOR
Date: 1 November 2019
Document codes: WT/DS471/ARB
Complainant: China
Respondent: U.S.
Third parties: Brazil, Canada, EU, India, Japan, South Korea, Norway, Russia, Saudi Arabia, Ukraine, Vietnam, Turkey, Taiwan
Dispute stage: Implementation & Compliance
Agreements cited: Art. VI:2  GATT 1994Art. 6.10, 9.2, 9.4, 2.4.2, 6.8, Annex II, 6.1  Anti-dumping

UNITED STATES – CERTAIN METHODOLOGIES AND THEIR APPLICATION
TO ANTI-DUMPING PROCEEDINGS INVOLVING CHINA
RECOURSE TO ARTICLE 22.6 OF THE DSU BY THE UNITED STATES
DECISION BY THE ARBITRATOR

BCI redacted, as indicated [[***]]

LIST OF ANNEXES
ANNEX A
WORKING PROCEDURES OF THE ARBITRATOR
Contents Page
Annex A-1 Working Procedures of the Arbitrator 5
Annex A-2 Additional Working Procedures of the Arbitrator concerning Business Confidential
Information
10
ANNEX B
ARGUMENTS OF THE PARTIES
Contents Page
Annex B-1 Executive summary of the arguments of the United States 12
Annex B-2 Executive summary of the arguments of China 23
ANNEX C
PROCEDURAL RULING OF THE ARBITRATOR
Contents Page
Annex C-1 Procedural Ruling on the United States' Request to Partially Open the
Arbitrator's Meeting to Public Observation
34
ANNEX D
GRAPHICAL ILLUSTRATIONS AND FIGURES CONCERNING THE PARTIES' PROPOSED CALCULATION
METHODOLOGIES
Contents Page
Annex D-1 China's proposed DID tabular approach: Graphical illustrations of the failure to
meet the parallel trends assumption provided by the United States
38
Annex D-2 United States' proposed Armington model: Relationship between the change in
the market share of Chinese exporters within the PRC-wide entity and the
duration of the anti-dumping orders
39
Annex D-3 United States' proposed Armington model: Relationship between the change in
the market share of Chinese exporters within the PRC-wide entity and the level
of the WTO-inconsistent PRC-wide duty rates
40
 ANNEX E
DATA INPUTS AND CALCULATIONS OF THE ARBITRATOR
Contents Page
Annex E-1 Data inputs for US market values in the year prior to the imposition of the anti-
dumping orders
42
Annex E-2 Data inputs for the share of US imports from China covered by different Chinese
exporters in the year prior to the imposition of the anti-dumping orders
49
Annex E-3 List of Chinese exporters outside the PRC-wide entity used to estimate the share
of different Chinese exporters for six anti-dumping orders
57
Annex E-4 List of Chinese exporters subject to the WA -T duty rates and other Chinese
exporters outside the PRC -wide entity used to estimate the share of different
Chinese exporters for three anti-dumping orders
70

Contents Page
Annex E-5 Data inputs for elasticities 74
Annex E-6 Data inputs for the actual anti-dumping duty rates 76
Annex E-7 List of anti-dumping duty rates used for two anti-dumping orders 81
Annex E-8 Data inputs for US market values in 2017 85
Annex E-9 Code and text version of the Armington model 91
Annex E-10 Data inputs used to implement the Armington model under the two steps 96
Annex E-11 Results of implementing the Armington model under the first step 99

CASES CITED IN THIS DECISION
Short Title Full Case Title and Citation
Canada – Continued
Suspension
Appellate Body Report, Canada – Continued Suspension of Obligations in the EC
– Hormones Dispute, WT/DS321/AB/R, adopted 14 November 2008, DSR
2008:XIV, p. 5373
EC – Bananas III (Ecuador)
(Article 22.6 – EC)
Decision by the Arbitrator, European Communities – Regime for the
Importation, Sale and Distribution of Bananas – Recourse to Arbitration by the
European Communities under Article 22.6 of the DSU, WT/DS27/ARB/ECU,
24 March 2000, DSR 2000:V, p. 2237
EC – Bananas III (US)
(Article 22.6 – EC)
Decision by the Arbitrator, European Communities – Regime for the
Importation, Sale and Distribution of Bananas – Recourse to Arbitration by the
European Communities under Article 22.6 of the DSU, WT/DS27/ARB,
9 April 1999, DSR 1999:II, p. 725
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 – Hormones (US)
(Article 22.6 – EC)
Decision by the Arbitrator, European Communities – Measures Concerning Meat
and Meat Products (Hormones), Original Complaint by the United States –
Recourse to Arbitration by the European Communities under Article 22.6 of the
DSU, WT/DS26/ARB, 12 July 1999, DSR 1999:III, p. 1105
Japan – DRAMs (Korea) Appellate Body Report, Japan – Countervailing Duties on Dynamic Random
Access Memories from Korea, WT/DS336/AB/R and Corr.1, adopted
17 December 2007, DSR 2007:VII, p. 2703
US – 1916 Act (EC)
(Article 22.6 – US)
Decision by the Arbitrator, United States – Anti-Dumping Act of 1916, Original
Complaint by the European Communities – Recourse to Arbitration by the
United States under Article 22.6 of the DSU, WT/DS136/ARB,
24 February 2004, DSR 2004:IX, p. 4269
US – Anti-Dumping
Methodologies (China)
Panel Report, United States – Certain Methodologies and Their Application to
Anti-Dumping Proceedings Involving China, WT/DS471/R and Add.1, adopted
22 May 2017, as modified by Appellate Body Report WT/DS471/AB/R, DSR
2017:IV, p. 1589
US – Continued Suspension Appellate Body Report, United States – Continued Suspension of Obligations in
the EC – Hormones Dispute, WT/DS320/AB/R, adopted 14 November 2008,
DSR 2008:X, p. 3507
US – COOL (Article 22.6 –
US)
Decisions by the Arbitrator, United States – Certain Country of Origin Labelling
(COOL) Requirements – Recourse to Article 22.6 of the DSU by the
United States, WT/DS384/ARB and Add.1 / WT/DS386/ARB and Add.1,
circulated to WTO Members 7 December 2015, DSR 2015:XI, p. 5877
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 – Anti-Dumping
Methodologies (China)
(Article 21.3(c))
Award of the Arbitrator, United States – Certain Methodologies and Their
Application to Anti-Dumping Proceedings Involving China – Arbitration under
Article 21.3(c) of the DSU, WT/DS471/RPT, 19 January 2018
US – Gambling (Article 22.6
– US)
Decision by the Arbitrator, United States – Measures Affecting the Cross-Border
Supply of Gambling and Betting Services – Recourse to Arbitration by the
United States under Article 22.6 of the DSU, WT/DS285/ARB,
21 December 2007, DSR 2007:X, p. 4163
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
US – Offset Act (Byrd
Amendment) (Brazil)
(Article 22.6 – US)
Decision by the Arbitrator, United States – Continued Dumping and Subsidy
Offset Act of 2000, Original Complaint by Brazil – Recourse to Arbitration by the
United States under Article 22.6 of the DSU, WT/DS217/ARB/BRA,
31 August 2004, DSR 2004:IX, p. 4341
US – Offset Act (Byrd
Amendment) (Brazil)
(Article 22.6 – US)
Decision by the Arbitrator, United States – Continued Dumping and Subsidy
Offset Act of 2000, Original Complaint by Brazil – Recourse to Arbitration by the
United States under Article 22.6 of the DSU, WT/DS217/ARB/BRA,
31 August 2004, DSR 2004:IX, p. 4341
US – Offset Act (Byrd
Amendment) (EC)
(Article 22.6 – US)
Decision by the Arbitrator, United States – Continued Dumping and Subsidy
Offset Act of 2000, Original Complaint by the European Communities –
Recourse to Arbitration by the United States under Article 22.6 of the DSU,
WT/DS217/ARB/EEC, 31 August 2004, DSR 2004:IX, p. 4591

Short Title Full Case Title and Citation
US – Stainless Steel
(Mexico)
Appellate Body Report, United States – Final Anti-Dumping Measures on
Stainless Steel from Mexico, WT/DS344/AB/R, adopted 20 May 2008, DSR
2008:II, p. 513
US – Tuna II (Mexico)
(Article 21.5 – Mexico)
Appellate Body Report, United States – Measures Concerning the Importation,
Marketing and Sale of Tuna and Tuna Products – Recourse to Article 21.5 of the
DSU by Mexico, WT/DS381/AB/RW and Add.1, adopted 3 December 2015, DSR
2015:X, p. 5133
US – Tuna II (Mexico)
(Article 22.6 – US)
Decision by the Arbitrator, United States – Measures Concerning the
Importation, Marketing and Sale of Tuna and Tuna Products – Recourse to
Article 22.6 of the DSU by the United States, WT/DS381/ARB, 25 April 2017,
DSR 2017:VIII, p. 4129
US – Upland Cotton
(Article 22.6 – US I)
Decision by the Arbitrator, United States – Subsidies on Upland Cotton –
Recourse to Arbitration by the United States under Article 22.6 of the DSU and
Article 4.11 of the SCM Agreement, WT/DS267/ARB/1, 31 August 2009, DSR
2009:IX, p. 3871
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 – Washing Machines
(Article 22.6 – US)
Decision by the Arbitrator, United States – Anti-Dumping and Countervailing
Measures on Large Residential Washers from Korea – Recourse to Article 22.6
of the DSU by the United States, WT/DS464/ARB and Add.1, 8 February 2019
US – Zeroing (Japan) Appellate Body Report, United States – Measures Relating to Zeroing and
Sunset Reviews, WT/DS322/AB/R, adopted 23 January 2007, DSR 2007:I, p. 3

MAIN EXHIBITS REFERRED TO IN THIS DECISION
Exhibit Title
Exhibit CHN-5 Difference in Difference Estimates (HS10) for 13 "As Applied" Cases
Exhibit CHN-13 Difference in Difference Estimates (HS10) for 12 "As Such" Examples
Exhibit CHN-21 China's Revised Estimates of Nullification or Impairment
Exhibit CHN-31 (BCI) Economic Discussion of Technical Issues Concerning the Armington Model Used by the
United States
Exhibit CHN-48 China's Adjusted Estimates of N ullification or Impairment to Take into Account Changing
Anti-Dumping Duty Rates
Exhibit CHN-49 (BCI) China's Adjusted Estimates of Nullification or Impairment to Take into Account Only PRC-
Wide Entity Exports
Exhibit CHN-53 China's Identification of Suitable Benchmarks for All Other Anti-Dumping Duty Rates
Exhibit CHN-55 (BCI) Data Required for Implementing the Armington Model Under Two Steps
Exhibit CHN-56 (BCI) Supporting Documents for Data Required for Implementing the Armington Model Under
Two Steps
Exhibit USA-5 Table of Relevant Anti-Dumping Duty Rates
Exhibit USA-7 High Pressure Steel Cylinders From the People's Republic of China: Notice of Court Decision
Not in Harmony With Final Determination in Less Than Fair Value Investigation, Notice of
Amended Final Determinatio n Pursuant to Court Decision, Notice of Revocation of
Antidumping Duty Order in Part, and Discontinuation of Fifth Antidumping Duty
Administrative Review, 82 Fed. Reg. 46,758 (6 October 2017)
Exhibit USA-13 (BCI) Appendices with Domestic Shipment and Imp ort Data, Elasticity Parameters, and Model
Results for Each Modelling Scenario, sourced from the USITC
Exhibit USA-15 R. Hallren and D. Riker, An Introduction to Partial Equilibrium Modeling of Trade Policy ,
Economics Working Paper Series (Working Paper 2017-07-B), USITC (July 2017)
Exhibit USA-16 Table of Elasticities
Exhibit USA-19 Code and Text Version of the United States' Proposed Armington Model
Exhibit USA-20 Presentation of Difference-in-Difference Estimation, Columbia University
Exhibit USA-21 (BCI) Table of US Customs Data on US Imports from China
Exhibit USA-23 J. Angrist, J. David, and J. Pischke, Mostly Harmless Econometrics: An Empiricist's
Companion, (Princeton University Press, 2009)
Exhibit USA-30 (BCI) Updated Table of US Customs Data on US Imports from China
Exhibit USA-31 (BCI) Revised Appendices with Domestic Shipment and Import Data, Elasticity Parameters, and
Model Results for Each Modelling Scenario, sourced from the USITC (Revised Exhibit USA-
13)
Exhibit USA-50 US Federal Register Notices Regarding Final Determinations in Anti -Dumping Duty
Investigations
Exhibit USA-51 US Federal Register Notices Regarding Preliminary Determinations in Ant i-Dumping Duty
Investigations
Exhibit USA-52 (BCI) Tables Presenting Armingt on Model with Import Supply Elastic ity at 10, Inputs for the
Armington Model, Armington Model with Import Supply Elasticity Equal to US Domestic
Supply Elasticity, and Armington Model with Infinite Import Supply Elasticity
Exhibit USA-54 (BCI) Calculated Maximum Share Covered by the PRC-Wide Entity
Exhibit USA-55 Information on Response Rate to US DOC Q&V Questionnaire in Anti -Dumping Duty
Investigations
Exhibit USA-56 (BCI)
(revised)
Tables of the Maximum Share of the PRC-Wide Entity and Non-Response Rate
Exhibit USA-57 Table of US Imports from China, World, and Rest of the World in Selected Years
Exhibit USA-58 Calculations on US Shipments
Exhibit USA-67 D. Riker, Multinational Production and Employment in an Industry-Specific Model of Trade,
Economics Working Paper Series (Working Paper 2018-08-C), USITC (August 2018)
Exhibit USA-68 Paul S. Armington, A Theory of Demand for Products Distinguished by Place of Production,
Vol. 1, No.1, International Monetary Fund (March 1969)
Exhibit USA-77 (BCI) Anti-Dumping Duty Rates Assigned by the USDOC to Chinese Firms Subject to Anti -
Dumping Duties
Exhibit USA-79 Table of Anti-Dumping Duty Rates for Certain Anti-Dumping Duty Orders and US Federal
Register Notices Regarding Certain Anti-Dumping Duty Orders
Exhibit USA-86 Approach for Estimating the Maximum Share of the PRC-Wide Entity
Exhibit USA-92 (BCI) Excel File with Simple Average of Duty Rates for Chinese Exporters Outside the PRC-Wide
Entity
Exhibit USA-94 (BCI)
(revised)
Excel File with Import Data in the Year Preceding the Imposition of Anti-Dumping Duties

OTHER DOCUMENTS REFERRED TO IN THIS DECISION
Title
A. Abadie, "Semiparametric Difference -in-Differences Estimators" (2005), Vol. 72, No. 1, The Review of Economic
Studies
B. Callaway and P. Sant'Anna, "Difference-in-differences with multiple time periods", Working Paper (2019)
D. Rubin, "Assignment to Treatment Group on the Basis of a Covariate" (1977), Vol. 2, No. 1, Journal of Educational
Statistics
G. Philippidis, H. Resano-Ezcaray, A.I. Sanjuán-López. "Shifting Armington Trade Preferences: A re-examination of the
Mercosur-EU negotiations" (2014), No. 40. Economic Modelling
M. Kuiper and F. van Tongeren, "Using gravity to move Armington" (2006), Paper prepared for the Ninth Annual
Conference on Global Economic Analysis in Addis Ababa, Ethiopia
M. Lechner, "The estimation of causal effects by difference-in-difference methods" (2011), Vol. 4, No. 3, Foundations
and Trends in Econometrics

ABBREVIATIONS USED IN THIS DECISION
Abbreviation Description
AHAM Association of Home Appliance Manufacturers
Aluminum Extrusions Aluminum Extrusions From the People's Republic of China (A-570-967)
Anti-Dumping Agreement Agreement on Implementation of Article VI of the General Agreement on
Tariffs and Trade 1994
APP-China Gold East Paper (Jiangsu) Co., Ltd., Gold Huasheng Paper Co., Ltd., Gold East
(Hong Kong) Trading Co., Ltd., Ningbo Zhonghua Paper Co., Ltd., Ningbo Asia
Pulp and Paper Co., Ltd.
Armington model Armington imperfect substitutes partial equilibrium model
Bags Polyethylene Retail Carrier Bags From the People's Republic of China
(A-570-886)
BCI Business confidential information
BTIC Beijing Tianhai Industry Co. Ltd
Chengde Group Jiangsu Chengde Steel Tube Share Co., Ltd. (Jiangsu Chengde) , Taizhou
Chengde Steel Tube Co., Ltd. (Taizhou Chengde), and Yangzhou Chengde Steel
Tube Co., Ltd. (Yangzhou Chengde)
Coated Paper Certain Coated Paper Suitable for High-Quality Print Graphics Using Sheet-Fed
Presses From the People's Republic of China (A-570-958)
Copper Pipe and Tube Seamless Refined Copper Pipe and Tube From the People 's Republic of China
(A-570-964)
Diamond Sawblades Diamond Sawblades and Parts Thereof from the People's Republic of China
(A-570-900)
DID Difference-in-difference
DSB Dispute Settlement Body
DSU Understanding on Rules and Procedures Governing the Settlement of Disputes
Formula-based approach Formula-based approach on market shares
Furniture Wooden Bedroom Furniture From the People's Republic of China (A-570-890)
GATT 1994 General Agreement on Tariffs and Trade 1994
GDP Gross domestic product
HS Harmonized System
HTS Harmonized Tariff Schedule
Iron Pipe Fittings Non-Malleable Cast Iron Pipe Fittings from the People's Republic of China
(A-570-875)
OCTG Certain Oil Country Tubular Goods from the People's Republic of China
(A-570-943)
OTR Tires Certain New Pneumatic Off-The-Road Tires from the People's Republic of
China (A-570-912)
Passenger Vehicle and Light
Truck Tires
Certain Passenger Vehicle and Light Truck Tires from the People's Republic of
China (A-570-016)
PRC People's Republic of China
PET Film Polyethylene Terephthalate Film, Sheet, and Strip from the People's Republic
of China (A-570-924)
Q&V Quantity and value
Ribbons Narrow Woven Ribbons With Woven Selvedge From the People's Republic of
China (A-570-952)
Sheet and Strip Stainless Steel Sheet and Strip from the People's Republic of China
(A-570-042)
Shrimp Certain Frozen Warmwater Shrimp From the People's Republic of China
(A-570-893)
Solar Panels Crystalline Silicon Photovoltaic Cells; Whether or Not Assembled into Modules;
from the People's Republic of China (A-570-979)
Steel Cylinders High Pressure Steel Cylinders From the People's Republic of China
(A-570-977)
Steel Flat Product Certain Cold Rolled Steel Flat Products from the People's Republic of China
(A-570-029)
Steel Nails Certain Steel Nails from the People's Republic of China (A-570-909)
Steel Line Pipe Certain Circular Welded Carbon Quality Steel Line Pipe from the People's
Republic of China (A-570-935)
Steel Pipe Circular Welded Carbon Quality Steel Pipe from the People's Republic of China
(A-570-910)
Steel Products Certain Corrosion-Resistant Steel Products from the People's Republic of China
(A-570-026)
Steel Standard, Line, and
Pressure Pipe
Certain Seamless Carbon and Alloy Steel Standard Line and Pressure Pipe
from the People's Republic of China (A-570-956)
Steel Wire Rod Carbon and Certain Alloy Steel Wire Rod from the People's Republic of China
(A-570-012)
TPCO Tianjin Pipe (Group) Co.

Abbreviation Description
USD United States dollar
USDOC United States Department of Commerce
USITC US International Trade Commission
Vienna Convention Vienna Convention on the Law of Treaties, Done at Vienna, 23 May 1969,
1155 UNTS 331; 8 International Legal Materials 679
WA-WA Weighted average-to-weighted average
WA-T Weighted average-to-transaction
Residential Washers Large Residential Washers from the People's Republic of China (A-570-033)
Wood Flooring Multilayered Wood Flooring From the People's Republic of China (A-570-970)
WTO World Trade Organization

1 INTRODUCTION
1.1 Original proceedings
1.1. The present arbitration proceedings arise in the dispute initiated by China concerning certain
methodologies used by the United States in anti-dumping proceedings concerning products imported
from China.
1.2. On 22 May 2017, the Dispute Settlement Body (DSB) of the World Trade Organization (WTO)
adopted the Appellate Body report in this dispute, together with the report of the panel as modified
by the Appellate Body. In doing so, the DSB adopted the panel's findings, which were not appealed,
that certain methodologies used by the United States are inconsistent with Articles 2.4.2, 6.10, 9.2,
and 9.3 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and
Trade 1994 (Anti -Dumping Agreement) and Article VI:2 of the General Agreement on Tariffs and
Trade 1994 (GATT 1994).1
1.3. On 19 January 2018, following referral to arbitration under Article 21.3(c) of the Understanding
on Rules and Procedures Governing the Settlement of Disputes (DSU), an arbitrator determined that
the reasonable period of time for the United States to implement the DSB recommendations and
rulings would expire on 22 August 2018.2
1.2 Request for arbitration and conduct of arbitration proceedings
1.4. On 9 September 2018, China requested authorization from the DSB to suspend concessions or
other obligations to the United States with respect to trade in goods in the amount of United States
dollar (USD) 7.043 billion.3
1.5. On 19 September 2018, the United States objected to China's proposed level of suspension. 4
At the DSB meeting of 21 September 2018, the DSB took note that the matter raised by the
United States had been referred to arbitration, as required by Article 22.6 of the DSU.5 The Arbitrator
was constituted on 5 October 2018 and was composed as follows:
Chairperson: Mr José Pérez Gabilondo

Members: Ms Beatriz Leycegui Gardoqui
Ms Enie Neri de Ross6
1.6. An organizational meeting was held on 8 November 2018 to discuss procedural aspects of the
arbitration proceeding s. During the organizational meeting, the United States requested the
Arbitrator to open the meeting with the parties to the public in full or in part. On 15 November 2018,
after consulting with the parties, the Arbitrator adopted its Working Procedures which left open the
issue of whether to open the meeting with the parties, pending the Arbitrator's ruling on the
United States' request. At the joint request of both parties, the Arbitrator also adopted, on
15 November 2018, additional working procedures to protect the confidentiality of b usiness
confidential information (BCI). On 15 November 2018, the Arbitrator adopted its timetable, which it
amended on 26 November 2018 and 16 May 2019. On 13 February 2019, the Arbitrator issued a
procedural ruling concerning the United States' request for a partially open meetin g and amended
its Working Procedures accordingly.
1.7. In accordance with the timetable and Working Procedures adopted by the Arbitrator, China
submitted a communication explaining its methodology for calculating the proposed level of
suspension of concessions or other obligations on 26 November 2018. The United States filed its
written submission on 7 January 2019, and China filed its written submission on 13 February 2019.

1 Panel Report, US – Anti-Dumping Methodologies (China), para. 8.1.
2 Award of the Arbitrator, US – Anti-Dumping Methodologies (China) (Article 21.3(c)), para. 4.1.
3 Recourse to Article 22.2 of the DSU by China, WT/DS471/18.
4 Recourse to Article 22.6 of the DSU by the United States, WT/DS471/19.
5 WT/DSB/M/418, para. 1.11.
6 WT/DS471/20.

The Arbitrator sent questions to the parties for written responses on 20 March 2019, to which the
parties responded on 1 April 2019.
1.8. The Arbitrator held its substantive meeting with the parties on 24 April 2019. On 27 April 2019,
the Arbitrator sent additional questions to the parties for written responses. The parties responded
to these questions on 10 May 2019. In accordance with the Arbitrator's decision to grant certain
extensions requested by both parties, the parties provided comments on each other's responses on
24 May 2019, the United States provided certain data and explanations on 5 and 11 June 2019, and
China provided comments on these on 13 June 2019.
1.9. On 30 September 2019, the Arbitrator issued to the parties a version of its Decision containing
BCI designated as such and contained between double brackets. In accordance with the Arbitrator's
decision to grant an extension requested by China, the parties returned, on 8 October 2019, with
requests for further redactions as well a s requests for certain information to be unredacted. On
14 October 2019, the parties commented on each other's requests. On 17 October 2019, the United
States made another request for further redactions. Taking into account the parties' requests and
comments, the Arbitrator issued a modified version of its Decision to the parties on 17 October 2019.
The Decision of the Arbitrator was circulated to WTO Members on 1 November 2019.
1.3 Mandate of the Arbitrator
1.10. The United States objects to China's propo sed level of suspension of concessions or other
obligations, contending that the proposed level is not equivalent to the level of nullification or
impairment caused by the United States' failure to implement the DSB recommendations and rulings
by the expiry of the reasonable period of time. Pursuant to Article 22.4 of the DSU, "[t]he level of
the suspension of concessions or other obligations authorized by the DSB shall be equivalent to the
level of the nullification or impairment." In proceedings under Article 22.6 of the DSU, the mandate
of the Arbitrator, as set out in Article 22.7 of the DSU, is as follows:
The arbitrator acting pursuant to paragraph 6 shall not examine the nature of the
concessions or other obligations to be suspended but shall determine whether the level
of such suspension is equivalent to the level of nullification or impairment . (emphasis
added)
1.11. Thus, our mandate in these proceedings is to determine whether the level of suspension that
China proposes (USD 7.043 billion) is equivalent7 to the level of nullification or impairment caused
by the United States' failure to implement the DSB recommendations and rulings by the expiry of
the reasonable period of time . The burden of proving that the requirements of the DSU have not
been met rests on the party challenging the proposed level of suspension8, here the United States.
We also recall that, generally, "it is for each party to bring forward the elements to sustain the
factual assertions it makes, and … each party has a duty to collaborate in the establishment of the
facts."9
1.12. Should we find that China's proposed level of suspension of concessions or other obligations
is not equivalent to the level of nullification or impairment caused by the United States' failure to
implement the DSB recommendations and rulings by the expiry of the reasonable period of time ,
our mandate requires us to determine the level of suspension that would be equivalent to the level
of nullification or impairment.10 In making that determination, previous arbitrators developed their

7 The term "equivalent" has been found to "connote[] a correspondence, identity or balance between
two related levels, i.e. between the level of the concessions to be suspended, on the one hand, and the level of
the nullification or impairment, on the other." (Decision by the Arbitrator, EC – Bananas III (US) (Article 22.6 –
EC), para. 4.1).
8 See e.g. Decisions by the Arbitrators, EC – Hormones (US) (Article 22.6 – EC), para. 9; US – 1916 Act
(EC) (Article 22.6 – US), paras. 3.2-3.3; US – Gambling (Article 22.6 – US), paras. 2.22-2.23; and US – COOL
(Article 22.6 – US), para. 4.7.
9 Decision by the Arbitrator, US – Gambling (Article 22.6 – US), para. 2.24. See also Decisions by the
Arbitrators, EC – Hormones (US) (Article 22.6 – EC), para. 11; US – 1916 Act (EC) (Article 22.6 – US),
10 See e.g. Decisions by the Arbitrators, US – Offset Act (Byrd Amendment) (EC) (Article 22.6 – US),
para. 3.69; US – Gambling (Article 22.6 – US), paras. 3.172-3.174;; and US – Washing Machines
(Article 22.6 – US), para. 1.15.

own appropriate methodologies 11, based either on elements of methodologies the parties
proposed12, or on an altogether differ ent approach.13 Our determination of the level of nullification
or impairment will necessarily be a reasoned estimate, relying on certain assumptions. 14 Such
assumptions must, however, be reasonable and based on "credible, factual, and verifiable
information", and "not on speculation ".15 We will not accept claims that are "' too remote ', 'too
speculative', or 'not meaningfully quantified.'"16
1.13. In fulfilling our mandate, we bear in mind that, pursuant to Article 22.8 of the DSU, the
suspension of concessions or other obligations shall be "temporary" pending full implementation of
the DSB recommendations and rulings, or a mutually agreed solution. On this basis, previous
arbitrators considered that the suspension of concessions or other obligations is to "induce
compliance".17 Other arbitrators also observed that the concept of equivalence in Article 22.4 of the
DSU means that obligations cannot be suspended in a "punitive" manner.18
1.4 Findings of inconsistency in the original proceedings
1.14. Since our mandate is to determine whether China's proposed level of suspension of
concessions or other obligations is equivalent to the level of nullification or impairment caused by
the United States' failure to implement the DSB recommendations and rulings by the expiry of the
reasonable period of time, we find it useful to begin our analysis by recalling the findings of
inconsistency made in the original proceedings. These findings of inconsistency f all into two
categories, which, for ease of reference, we refer to as: (a) findings of inconsistency concerning the
United States' use of the weighted average -to-transaction (W A-T) methodology with zeroing in
calculating dumping margins; and (b) findings o f inconsistency concerning the United States'
treatment of multiple exporters as a single, government-wide entity under the so-called Single Rate
Presumption.
1.15. With respect to the United States' use of the WA -T methodology with zeroing, the original
panel made "as applied" findings of violation with respect to dumping calculations made for four
exporters in four anti-dumping proceedings. More particularly, the panel found that the United States
Department of Commerce (USDOC) had acted inconsistently with Article 2.4.2 of the Anti-Dumping
Agreement in determining that three exporters had engaged in targeted dumping, and in applying
the WA-T methodology with zeroing to all export transactions when calculating the dumping margins
for these three exporters in the Coated Paper, OCTG, and Steel Cylinders original investigations.19
The panel also found that the USDOC had acted inconsistently with Article 9.3 of the Anti-Dumping
Agreement and Article VI:2 of the GATT 1994 in applying the WA-T methodology with zeroing when
calculating the dumping margin for one exporter in the third administrative review in PET Film.20
These findings of inconsistency were not appealed.
1.16. As for the Single Rate Presumption, the original panel made findings of violation with respect
to the Single Rate Presumption "as such" and "as applied" in 38 anti-dumping proceedings covering
13 products.21 More particularly, the panel found that the USDOC's treatment of all exporters that

11 See e.g. Decision by the Arbitrator, US – Offset Act (Byrd Amendment) (EC) (Article 22.6 – US),
para. 3.115.
12 See e.g. Decision by the Arbitrator, US – Gambling (Article 22.6 – US), para. 3.174.
13 See e.g. Decision by the Arbitrator, US – Offset Act (Byrd Amendment) (EC) (Article 22.6 – US),
paras. 3.69-3.79.
14 Decision by the Arbitrator, EC – Hormones (US) (Article 22.6 – EC), para. 41. See also Decisions by
the Arbitrators, US – COOL (Article 22.6 – US), para. 4.5; and US – Washing Machines (Article 22.6 – US),
para. 1.16.
15 Decision by the Arbitrator, US – 1916 Act (EC) (Article 22.6 – US), paras. 5.54 and 5.63. See also
Decisions by the Arbitrators, US – COOL (Article 22.6 – US), para. 4.5; US – Tuna II (Mexico) (Article 22.6 –
16 Decision by the Arbitrator, US – 1916 Act (EC) (Article 22.6 – US), para. 5.57.
17 Decisions by the Arbitrators, EC – Bananas III (US) (Article 22.6 – EC), para. 6.3; EC – Hormones
(US) (Article 22.6 – EC), para. 40; and US – 1916 Act (EC) (Article 22.6 – US), para. 5.7.
18 Decisions by the Arbitrators, EC – Bananas III (US) (Article 22.6 – EC), para. 6.3; and US – 1916 Act
(EC) (Article 22.6 – US), para. 5.8.
19 Panel Report, US – Anti-Dumping Methodologies (China), para. 8.1.a.i-iv.
20 Panel Report, US – Anti-Dumping Methodologies (China), para. 8.1.b.
21 (1) Aluminum Extrusions, (2) Coated Paper, (3) Shrimp, (4) OTR Tires, (5) OCTG, (6) Solar Panels,
(7) Diamond Sawblades, (8) Steel Cylinders, (9) Wood Flooring, (10) Ribbons, (11) Bags, (12) PET Film, and
(13) Furniture.

do not pass the so-called Separate Rate Test as a single government -wide entity in anti -dumping
proceedings concerning non-market economy countries was a measure of general and prospective
application that was, "as such ", inconsistent with Articles 6.10 and 9.2 of the Anti -Dumping
Agreement. The panel also found that the USDOC had acted inconsistently with Articles 6.10 and
9.2 of the Anti -Dumping Agreement in applying that measure to establish a People's Republic of
China (PRC)-wide entity and in assigning to this entity a single PRC -wide duty rate in 13 original
investigations and 25 administrative reviews.22 These findings of inconsistency were not appealed.
1.5 Structure of analysis
1.17. Below, we first address certain procedural matters. We then address certain preliminary issues
by setting out the scope of these arbitration proceedings in terms of the products and anti-dumping
orders at issue as well as the reference period for determining the level of nullification or impairment
caused by the United States' failure to implement the DSB recommendations and rulings. In
accordance with our mandate, set out in section 1.3 above, we then proceed to determine whether
the level of suspension of concessions or other obligations that China proposes is equivalent to the
level of nullification or impairment . In this regard, we will assess: (a) the counterfactual used by
China as the hypothetical scenario describing what would have happened had the United States
implemented the DSB recommendations and rulings by the expiry of the reasonable period of time,
and (b) the calculation methodology used by China to estimate the level of nullification or impairment
caused by the United States' failure to implement the DSB recommendations and rulings by the
expiry of the reasonable period of time . If we do not find the counterfactual or calculation
methodology that China proposes appropriate, we will make our own determination of the level of
suspension that would be equivalent to the level of nullification or impairment.
2 PROCEDURAL MATTERS
2.1. In this section, we address two procedural matters raised in these proceedings, namely, the
treatment of BCI and the United States' request for a partially open meeting.
2.1 Treatment of BCI
2.2. At the Arbitrator's organizational meeting held on 8 November 2018, both parties requested
that the Arbitrator adopt additional working procedures to protect the confidentiality of BCI
submitted in the course of the proceedings. As indicated in the preceding section, the Arbitrator
adopted Additional Working Procedures of the Arbitrator Concerning Business Confidential
Information (Additional Working Procedures) on 15 November 2018.23
2.3. The Additional Working Procedures define the scope of information covered by the Additional
Working Procedures 24, provide that each party shall clearly indicate the presence of BCI in its
submissions25, and limit access to, and permissible use of, BCI submitted in the course of the
proceedings.26
2.4. Paragraph 8 of the Additional Working Procedures provides that "[t]he Arbitrator will not
disclose BCI, in its decision or in any other way, to persons not authorized under these pro cedures
to have access to BCI." The paragraph goes on to state that the Arbitrator may "make statements
of conclusion drawn from such information " and that t he parties shall be given an opportunity to
ensure that all BCI has been redacted from the Arbitrator's Decision prior to its circulation to the
WTO membership. This paragraph forms the legal basis on which the Arbitrator has redacted BCI
statements from the public version of this Decision.27
2.5. Accordingly, the text of the version of our Decision circulated to Members is identical to the
text of the confidential version issued to the parties, with the exception of passages that disclose

22 Panel Report, US – Anti-Dumping Methodologies (China), para. 8.1.c.iii.
23 See Annex A-2.
24 Additional Working Procedures, Annex A-2, para. 1.
25 Additional Working Procedures, Annex A-2, paras. 6 and 7.
26 Additional Working Procedures, Annex A-2, paras. 4 and 5.
27 See Appellate Body Report, US – Tuna II (Mexico) (Article 21.5 – Mexico), para. 5.4.

BCI. Such passages have been replaced by "[[ ***]]". In drafting and redacting th e Decision, we
have tried to ensure that the public version of our Decision is understandable.28
2.2 United States' request to open the Arbitrator's meeting to public observation
2.6. At the organizational meeting held on 8 November 2018, the Uni ted States requested that
paragraph 10 of our draft Working Procedures be modified to open our meeting with the parties to
the public, in full or in part . China objected to this request. In written comments submitted on
12 November 2018, the United States reiterated its request , and China its objection. On
14 November 2018, each party commented on the comments submitted by the other party.
2.7. On 13 February 2019, we communicated to the parties our ruling declining the United States'
request and confirmed that our meeting with the parties would be conducted in closed session. The
full text of our ruling on this matter is contained in Annex B-1.
3 SCOPE OF THE PRESENT ARBITRATION PROCEEDINGS
3.1 General
3.1. In this section, we set out the scope of the products and anti-dumping orders that will form
the basis of our determination of the level of nullification or impairment caused by the United States'
failure to implement the DSB recommendations and rulings by the expiry of the reasonable period
of time.
3.2. In estimating the level of nullification or impairment, China provides calculations for both the
"as applied" and the "as such" findings of violation made in the original proceedings. With respect
to the "as applied" findings of violation, China initially relied on th e 13 anti-dumping orders that
were subject to the "as applied" findings of violation, namely: (1) Aluminum Extrusions, (2) Bags,
(3) Coated Paper, (4) Diamond Sawblades, (5) Furniture, (6) OCTG, (7) OTR Tires, (8) PET Film,
(9) Ribbons, (10) Shrimp, (11) Solar Panels, (12) Steel Cylinders, and (13) Wood Flooring. China
subsequently excluded Aluminum Extrusions from the scope and instead relies on the remaining
12 relevant anti-dumping orders.29 With respect to the "as such" findings of violation, China argues
that more than 100 anti -dumping orders are affected by the "as such" findings of violation, but
selects only 12 additional anti-dumping orders as the basis for estimating the level of nullification or
impairment concerning the "as such" findings of violation. These are: (14) Copper Pipe and Tube ,
(15) Iron Pipe Fittings , (16) Passenger Vehicle and Light Truck Tires , (17) Residential Washers,
(18) Sheet and Strip, (19) Steel Flat Products, (20) Steel Line Pipe, (21) Steel Nails, (22) Steel Pipe,
(23) Steel Products, (24) Steel Standard, Line, and Pressure Pipe, and (25) Steel Wire Rod.
3.3. Despite providing calculations for both the "as applied" and "as such" findings of violation,
China bases its request for suspension in the amount of USD 7.043 billion only on the "as applied"
findings of violation, arguing that these alone substantiate its request. 30 If the A rbitrator were to
reject or lower China's estimated level of nullification or impairment concerning the "as applied"
findings of violation , China req uests the Arbitrator to "add to the lowered estimate" the level of
nullification or impairment concerning the "as such" findings of violation.31
3.4. In estimating a lower level of nullification or impairment than that China proposes and arguing
that China's req uest for suspension in the amount of USD 7 .043 billion does not meet the
requirements of the DSU, the United States initially relied on all 13 anti-dumping orders that were
subject to the "as applied" findings of violation as well as the 12 additional selected anti -dumping
orders that were subject to the "as such" findings of violation.32 Following China's decision to exclude
Aluminum Extrusions from its calculations, the United States did so as well.33 Further, following the
USDOC's revocation of the OTR Tires order on 10 May 2019, the United States asked the Arbitrator

28 See Appellate Body Report, Japan – DRAMS (Korea), para. 279.
29 China's written submission, fn 60; and response to Arbitrator question No. 1(a), para. 1.
30 China's methodology paper, paras. 12 and 173.
32 See e.g. United States' written submission, paras. 4 and 7.
33 United States' response to Arbitrator question No. 1(b), para. 2.

to also exclude this order from its determination, arguing that there can be no nullification or
impairment concerning this order.34
3.5. While there is no disagreement between the parties concerning 23 of the 25 anti -dumping
orders at issue, they have differing views on whether we should include Aluminum Extrusions and
OTR Tires in our determination. We add ress each of these anti -dumping orders separately below,
and then provide an overall conclusion on the scope of these arbitration proceedings.
3.2 Aluminum Extrusions
3.6. China initially provided calculations for Aluminum Extrusions but subsequently chose to exclude
this anti-dumping order, because the USDOC expanded the product scope of this anti-dumping order
by including additional Harmonized Tariff Schedule (HTS) numbers in the period following the initial
WTO dispute settlement proceedings. Since China's calculation methodology for estimating the level
of nullification or impairment relies on public data, China considers that the expansion of the HTS
numbers would result in "complications" 35, a "disproportionate amount of work" 36, and "extreme
(but unavoidable) uncertainty".37 China submits that it has chosen to exclude Aluminum Extrusions
"for simplicity of presentation and in order to avoid a long, arduous debate about product scope"38,
also noting that its estimated level of nullification or impairment "far exceeds its $7 billion request"
even without Aluminum Extrusions.39 China, however, argues that Aluminum Extrusions should not
be excluded if the Arbitrator were to use a calculation methodology other than the one China
proposes.40 Specifically, China argues that the United States' proposed calculation methodology does
not face the same complications since it does not rely on public data. 41 The United States does not
object to China's decision to exclude Aluminum Extrusions from its calculations, but submits that the
scope should not depend on the methodological approach followed by the Arbitrator, as suggested
by China. 42 In the United States' view, this wo uld run counte r to "fundamental principles of
procedural fairness", as it would require the United States to "try to argue against a constantly
moving target".43
3.7. It is undisputed that the Aluminum Extrusions order is covered by the findings of inconsistency
in the original proceedings, and that China clearly identified Aluminum Extrusions as forming part of
the scope of these arbitration proceedings in its methodology paper. The United States has not
contested China's explanation that the exclusion of Aluminum Extrusions from China's calculations
is based on practical reasons related to the use of public data under China's proposed calculation
methodology.44 We see no such practical reasons with respect to other calculation methodologies,
including the one that the United States proposes. Indeed, the United States itself provided
calculations for Aluminum Extrusions without pointing to any practical difficulties.45
3.8. In light of this, we see no reason to prevent China from excluding Aluminum Extrusions from
its own calculations while requesting that the Arbitrator not exclude Aluminum Extrusions if it were
to use a calculation methodology other than the one China proposes. Further, we do not believe that
this would deprive the United States of any due process rights. Since Aluminum Extrusions was
clearly identified in China's methodology paper, the United States had sufficient time and opportunity
to develop its arguments and c alculations with respect to this anti-dumping order. Indeed, this is
exactly what the United States did in its written submission as well as in its responses to the
Arbitrator's questions.46

34 United States' comments on China's responses to Arbitrator questions, para. 2.
35 China's written submission, fn 60.
36 China's response to Arbitrator question No. 1(a), para. 1.
37 China's response to Arbitrator question No. 1(a), para. 1.
38 China's response to Arbitrator question No. 50(a), para. 2.
39 China's opening statement at the meeting of the Arbitrator, para. 42. See also China's response to
40 China's opening statement at the meeting of the Arbitrator, para. 42.
41 China's response to Arbitrator question No. 50(a), para. 3.
42 United States' response to Arbitrator question No. 50(b), para. 2.
43 United States' response to Arbitrator question No. 50(b), para. 2.
44 United States' comments on China's response to Arbitrator question No. 50(a), para. 4.
46 See e.g. United States' written submission, paras. 60, 76 and 86; and response to Arbitrator question
No. 62, paras. 58-73.

3.3 OTR Tires
3.3.1 Assessment by the Arbitrator
3.9. The United States provided arguments and calculations concerning OTR Tires throughout these
arbitration proceedings but explained, in its comments on China's responses to questions, that the
USDOC revoked this anti-dumping order on 10 May 2019, effective as of 4 February 2019. In light
of this, the United States argues that there can be no nullification or impairment concerning
OTR Tires, and that the Arbitrator should exclude it from the scope of its determination. 47 When
given the opportunity to comment on the new information and arguments provided by the
United States, China objected to the United States' approach, requesting that the Arbitrator take
into account this order in determining the level of nullification or impairment. In this regard, China
points out that OTR Tires order had not been revoked by the expiry of the reasonable period of time,
22 August 2018, and remained effective for six additional months, covering most of the duration of
these arbitration proceedings. The omission of OTR Tires would, in China's view, leave China without
remedies for redressing the nullification or impairment suffered after the expiry of the reasonable
period of time. China further submits that the United States did not revoke the OTR Tires order with
a view to implementing the DSB recommendations and rulings, and points to the importance of
inducing the United States to withdraw or modify the additional 24 anti-dumping orders at issue.48
3.10. Our mandate is to determine whether the level of suspension that China proposes is
equivalent to the level of nullification or impairment caused by the United States' failure to
implement the DSB recommendations and rulings by the expiry of the reasonable period of time. As
explained below, whe re relevant and appropriate, we take into account modifications to the anti -
dumping orders at issue implemented by the USDOC prior to the expiry of the reasonable period of
time. For OTR Tires, however, it is undisputed that this anti-dumping order was in full effect by the
expiry of the reasonable period of time. Consequently, if we were to exclude OTR Tires from the
scope of our determination, we would be ignoring the nullification or impairment caused by the
failure of the United States to implement the DSB recommendations and rulings on OTR Tires by the
expiry of the reasonable period of time. Such an approach would not be consistent with our
mandate.49
3.3.2 Separate opinion of one member of the Arbitrator
3.11. The reasonable period of time for the United States to implement the DSB recommendations
and rulings expired on 22 August 2018. 50 The anti-dumping order on OTR Tires was withdrawn by
the USDOC on 4 February 2019. Thus, the DSB recommendations and rulings with respect to this
order were fully implemented within less than six months following the expiry of the reasonable
period of time. In light of this, I disagree with the majority's decision to take this order fully into
account in estimating the level of nullification or impairment. In my view, the estimat e of the level
of nullification or impairment for this particular order should be prorated because it only remained
in force for less than six months following the expiry of the reasonable period of time. Further, the
DSB should authorize China to exercise its right to suspend concessions or other obligations with
regard to this order for one year only, in an amount corresponding to the prorated level of
nullification or impairment.
3.4 Conclusion
3.12. For the reasons set out above, we consider the scope of these arb itration proceedings to be
as follows: For the purpose of assessing the level of nullification or impairment estimated by China,
we will base our analysis on the 12 anti-dumping orders subject to the "as applied" findings of
violation other than Aluminum Extrusions. These 12 anti-dumping orders are (1) Bags, (2) Coated
Paper, (3) Diamond Sawblades, (4) Furniture, (5) OCTG, (6) OTR Tires, (7) PET Film, (8) Ribbons,
(9) Shrimp, (10) Solar Panels, (11) Steel Cylinders, and (12) Wood Flooring.

47 United States' comments on China's responses to Arbitrator questions, para. 2.
48 China's communication of 13 June 2019, pp. 4-5. China explains that the USDOC revoked OTR Tires
in the context of a sunset review, due to a lack of ongoing injury to the US domestic industry. (Ibid.)
49 For a similar approach, see Decision by the Arbitrator, US – Tuna II (Mexico) (Article 22.6 – US),
paras. 3.4-3.25.
50 Award of the Arbitrator, US – Anti-Dumping Methodologies (China) (Article 21.3(c)), para. 4.1.

3.13. If we find that the level of suspension that China proposes is not equivalent to the level of
nullification or impairment stemming from these 12 anti-dumping orders and proceed to make our
own determination using a different calculation methodology, we will base our determination on all
13 anti-dumping orders subject to the "as applied" findings of violation as well as the 12 additional
anti-dumping orders subject to the "as such" findings of violation. These 25 anti-dumping orders
are (1) Aluminum Extrusions, (2) Bags, (3) Coated Paper, (4) Diamond Sawblades, (5) Furniture,
(6) OCTG, (7) OTR Tires, (8) PET Film, (9) Ribbons, (10) Shrimp, (11) Solar Panels, (12) Steel
Cylinders, (13) Wood Flooring, (14) Copper Pipe and Tube, (15) Iron Pipe Fittings, (16) Passenger
Vehicle and Light Truck Tires , (17) Residential Washers , (18) Sheet and Strip , (19) Steel Flat
Products, (20) Steel Line Pipe , (21) Steel Nails, (22) Steel Pipe, (23) Steel Products, (24) Steel
Standard, Line, and Pressure Pipe, and (25) Steel Wire Rod.
3.14. All of these 25 anti-dumping orders are covered by the original panel's findings of violation
concerning the USDOC's use of the Single Rate Presumption. Only four of these anti-dumping orders,
namely Coated Paper, OCTG, Steel Cylinders, and PET Film, are covered by the original panel's
findings of violation concerning the USDOC's use of the WA-T methodology with zeroing.
4 REFERENCE PERIOD
4.1. Although the reasonable period of time, for the United States to implement the DSB
recommendations and rulings, did not expire until 22 August 2018, China uses the calendar year of
2017 as the reference period for determining the level of nullification or impairment caused by the
United States' failure to implement these recommendations and rulings.51 China explains that 2017
is the most recent year for which complete data is available, and further argues that its exports to
the United States have been seriously distorted by multiple policy shifts in the United States during
the calendar year of 2018, which resulted in additional tariffs on numerous products. 52 The
United States also uses 2017 as the reference period since this is a recent period of time for which
data is available.53
4.2. Taking into account the reasons presented by both parties, we too consi der that 2017 is a
reasonable reference period to use for determining the level of nullification or impairment caused by
the United States' failure to implement the DSB recommendations and rulings by the expiry of the
reasonable period of time.
5 ARBITRATOR'S DETERMINATION OF THE APPROPRIATE COUNTERFACTUAL
5.1. In substantiating its request for suspension in the amount of USD 7.043 billion, China estimates
the level of nullification or impairment caused by the United States' failure to implement the DSB
recommendations and rulings by using a "counterfactual". Counterfactuals are frequently used by
arbitrators and reflect "a hypothetical scenario that describes what would have happened in terms
of trade flows had the responding party implemented the DSB recommendations and rulings".54
5.2. We see a counterfactual as an analytical tool that allows an arbitrator acting under Article 22.6
of the DSU to determine the level of nullification or impairment caused by the WTO -inconsistent
measures maintained by the original respon dent. It is for the original respondent, here the
United States, to determine how to implement the DSB recommendations and rulings in order to
bring its measure into compliance with the covered agreements . Therefore, in determining a
counterfactual, we will not prejudge how exactly the United States would have implemented the DSB
recommendations and rulings at issue. N or will we speculate on which compliance scenario would
be the "most likely".55 Rather, we will evaluate whether China's proposed counterfactual reflects "at
least a plausible or 'reasonable' compliance scenario". 56 This assessment is, as explained by the
arbitrator in US – Gambling (Article 22.6 – US), connected to the specific circumstances of the

52 China's methodology paper, paras. 58-65.
53 United States' written submission, fn 27.
54 Decision by the Arbitrator, US – Tuna II (Mexico) (Article 22.6 – US), para. 4.4.
55 Decision by the Arbitrator, US – Gambling (Article 22.6 – US), para. 3.26.
56 Decision by the Arbitrator, US – Gambling (Article 22.6 – US), para. 3.27. See also Decisions by the
Arbitrators, US – Tuna II (Mexico) (Article 22.6 – US), para. 4.5; and US – Washing Machines (Article 22.6 –
US), para. 3.10.

dispute and the original proceedings.57 While we will necessarily have to rely on certain assumptions
to answer the hypothetical question of what would have happened if the United States had
implemented the DSB recommendations and rulings, these assumptions must be reasonable and
"accurately reflect the benefits … that have actually been nullified or impaired".58
5.3. With these overall considerations in mind , we will first assess the counterfactual that China
proposes. If we find that this counterfactual does not reflect a reasonable or plausible compliance
scenario, we will proceed to determine an alternative counterfactual for all 25 anti-dumping orders
at issue.59
5.1 Assessment of China's proposed counterfactual
5.4. China proposes to use the withdrawal of the WTO-inconsistent measures as the counterfactual.
In China's view, this entails withdrawal of the entirety of the anti-dumping orders at issue, meaning
withdrawal of the anti-dumping duties assigned to all Chinese exporters under these anti -dumping
orders.
5.5. China argues, first, that withdraw al of the WTO -inconsistent measures reflects the "express
preference" in the DSU 60 and the "predominate practice" in prior Article 22.6 arbitration
proceedings.61 Second, China points out that the United States has taken no action to comply with
the DSB reco mmendations and rulings, and argues that China's proposed counterfactual would
provide an incentive to induce compliance.62 Third, China argues that its proposed counterfactual is
appropriate in the context of this specific dispute because it can be applied "easily and consistently"
to all of the anti-dumping orders at issue63 without the complexity of having to distinguish between
the different findings of inconsistency64 or having to speculate about factual or legal aspects. 65 The
United States opposes China' s proposed counterfactual, arguing that it goes beyond the DSB
recommendations and rulings 66 because the findings of inconsistency in the original proceedings
relate only to certain aspects of the anti -dumping orders at issue, whereas other aspects have not
been found WTO-inconsistent.67
5.6. We recall that the counterfactual reflects a hypothetical scenario describing what would have
happened if the United States had brought its WTO-inconsistent measures into compliance with the
DSB recommendations and rulings by the expiry of the reasonable period of time. China's proposal
to use the withdrawal of all of the anti-dumping orders at issue as the counterfactual is premised on
the understanding that the "WTO-inconsistent measures" comprise the entirety of the anti-dumping
orders at issue. However, and as described in section 1.4 above, the findings of violation in the
original proceedings did not concern the entirety of the anti-dumping orders at issue, but rather the
USDOC's use of certain methodologies in calculating the dumping margins for a subset of the Chinese
exporters subject to the relevant anti-dumping orders. More particularly, the measures found to be
WTO-inconsistent were the USDOC's use of the WA -T methodology with zeroing "as applied" in
certain anti-dumping proceedings, and its use of the Single Rate Presumption "as such" and "as
applied" in certain anti -dumping proceedings. Thus, the scope of the findings of violation in the
original proceedings covers less than the entirety of the anti -dumping orders a t issue. First , the
findings of violation pertain only to the USDOC's determination of dumping in the proceedings
resulting in the anti -dumping orders at issue. No other substantive aspects, such as the USDOC's

57 Decision by the Arbitrator, US – Gambling (Article 22.6 – US), para. 3.30.
58 Decision by the Arbitrator, US – Gambling (Article 22.6 – US), para. 3.30.
59 We recall that, although China has excluded Aluminum Extrusions from its calculations due to
practical reasons relating to its calculation methodology, we have determined that it would be appropriate to
base our determination of the level of nullification or impairment on all 25 anti-dumping orders at issue if we
were to reject China's estimated level of nullification or impairment. (See paras. 3.6-3.8 and 3.12-3.13 above).
We therefore find it useful to determine an appropriate counterfactual for all 25 anti-dumping orders at issue.
60 China's written submission, para. 8. See also ibid. paras. 11-19.
61 China's written submission, para. 9. See also ibid. paras. 21-46; and China's response to Arbitrator
question No. 2(a), paras. 9 and 11.
62 China's written submission, paras. 88-94. See also China's response to Arbitrator question No. 2(a),
para. 31.
65 China's methodology paper, para. 24; written submission, para. 86; and response to Arbitrator
question No. 2(a), paras. 25 and 27-29.
66 United States' written submission, para. 28. See also ibid. paras. 29-36.

determination of injury or causality, nor any procedural aspects of the proceedings, were implicated.
Second, the dumping determinations implicated by the findings of violation pertain to a subset of
the Chinese exporters subject to the anti -dumping orders. More particularly, in the relevant anti -
dumping proceedings, the USDOC calculated individual duty rates for the Chinese exporters chosen
for individual examination; assigned the so-called separate duty rate to the Chinese exporters that
passed the Separate Rate Test but were not chosen for individu al examination; and assigned the
PRC-wide duty rate to the Chinese exporters that did not pass the Separate Rate Test. It is
undisputed that, in most of the anti-dumping orders, neither the dumping determinations made for
the exporters that the USDOC examined individually, nor those made for the exporters subject to
the separate duty rate, are implicated by the findings of violation in the original proceedings. China
also acknowledges that certain elements of the anti -dumping orders were not found to be WTO -
inconsistent.68
5.7. Accordingly, the counterfactual must reflect what would have happened if, by the expiry of the
reasonable period of time, the USDOC ceased using the WTO-inconsistent WA-T methodology with
zeroing and the WTO-inconsistent Single Rate Presump tion in the relevant anti-dumping
proceedings, in this limited context. In our view, it would not be reasonable to assume that, had the
USDOC ceased using the WTO -inconsistent WA -T methodology with zeroing and the WTO-
inconsistent Single Rate Presumption, it would have withdrawn the entirety of the anti -dumping
orders, including the anti-dumping duties imposed on exporters whose dumping margins were not
calculated using these WTO-inconsistent methodologies. We agree with the United States that this
would go beyond the DSB recommendations and rulings.
5.8. While we do not disagree with China's view that suspension of concessions or other obligations
is meant to induce compliance, we do not believe that this warrants suspension of concessions or
other obligations at a level going beyond the DSB recommendations and rulings. In our view , this
would run the risk of suspending concessions or other obligations in a punitive manner. Further,
while China's proposed counterfactual is undoubtedly more straightforward and easier to implement
for purposes of estimating the level of nullification and impairment, in our view, this does not
necessarily render the counterfactual a reasonable or plausible compliance scenario. We cannot let
simplicity outweigh our guiding principle that the counterfactual must represent a reasonable or
plausible compliance scenario.
5.9. For the reasons set out above, we conclude that China's proposal to use the withdrawal of the
entirety of the anti-dumping orders at issue as the counterfactual does not reflect a reasonable or
plausible compliance scenario. In order to fulfil our mandate, we therefore proceed to determine an
alternative counterfactual to provide the basis for our estimation of the level of nullification or
impairment.
5.2 Determination of an alternative counterfactual
5.10. Having found that China's proposed counterfactual does not reflect a reasonable or plausible
compliance scenario, we proceed to determine an alternative counterfactual. In this regard, we find
it useful to begin with an assessment of the United States' proposed counterfactual and consider
whether that counterfactual can provide the basis for our determination.
5.11. The United States proposes to modify the anti-dumping duty rates calculated by the USDOC
using the WTO-inconsistent methodologies, i.e. the WA-T methodology with zeroing and the Single
Rate Presumption. The United States' proposal follows a case -by-case approach, under whi ch the
proposed counterfactual varies depending on the specific factual circumstances of each anti-dumping
order and the types of violation it entails. In the United States' view, this is the only way to correctly
estimate the impact of the USDOC's continu ed application of the WTO -inconsistent methodologies
on China's exports to the United States.69 China criticizes the United States' approach for being
overly complex and for requiring too much speculation about legal and factual aspects and too much
company-specific data that may not be publicly available.70

68 China's response to Arbitrator question No. 2, para. 13.
69 United States' written submission, paras. 42-47.
70 China's written submission, paras. 68-87; and response to Arbitrator question No. 2(a), paras. 24
and 29.

5.12. In our view, the complexity of the United States' proposed counterfactual does not, in and of
itself, render it unreasonable or implausible. As explained above, the counterfactual must reflect
what would have happened if, by the expiry of the reasonable period of time, the USDOC ceased
using the WA-T methodology with zeroing and the Single Rate Presumption in the relevant anti-
dumping proceedings. In light of this , we agree with the United States' overarching approach for
determining the appropriate counterfactual. Specifically, we find it appropriate to determine the
counterfactual on a case-by-case basis, taking into account the specific circumstances of each anti-
dumping order and the types of violations it entails.
5.13. Below, we determine the appropriate counterfactual for all 25 anti -dumping orders, starting
with the counterfactual for the USDOC's use of the WTO-inconsistent WA-T methodology with zeroing
in four anti-dumping orders and moving on to the counterfactual for the USDOC's use of the WTO-
inconsistent Single Rate Presumption in all 25 anti -dumping orders at issue. We then provide an
overall conclusion on the appropriate counterfactual for all 25 anti-dumping orders at issue.
5.2.1 Counterfactual for the USDOC's use of the WTO -inconsistent WA-T methodology
with zeroing
5.14. As mentioned above, the original panel's findings of violation concerning the USDOC's use of
the WA-T methodology with zeroing only cover four of the anti -dumping orders at issue, namely
Coated Paper , OCTG, Steel Cylinders , and PET Film . Due to the different factual circumstances
surrounding these four anti -dumping orders, the United States proposes different counterfactuals
for each order. We also address each anti-dumping order separately below.
5.2.1.1 Coated Paper
5.15. In the original investigation in Coated Paper, the USDOC determined that the Chinese exporter
APP-China had engaged in targeted dumping, and calculated two dumping margins for this exporter.
The first dumping margin was [[***]]% and was calculated using the weighted average-to-weighted
average (WA-WA) methodology, one of the two methodologies which, pursuant to Article 2.4.2 of
the Anti-Dumping Agreement, must normally be used in calculating dumping margins. The second
dumping margin was 7.62% and was calculated using the exceptional WA-T methodology permitted
under Article 2.4.2 in situations involving targeted dumping. The USDOC applied the WA -T
methodology with zeroing to all of APP-China's export transactions. Since the WA-T dumping margin
was higher than the WA -WA dumping margin, the USDOC determined that the WA -WA dumping
margin would conceal APP-China's targeted dumping and therefore used the WA-T dumping margin
to determine APP-China's individual duty rate.71 The USDOC also used the WA-T duty rate calculated
for APP-China as the separate duty rate assigned to the Chinese exporters that passed the Separate
Rate Test but were not chosen for individual examination.72
5.16. The United States argues that the Arbitrator should use a 0.00 % duty rate as the
counterfactual for APP -China since the WA -WA duty rate on record for APP -China is de minimis,
[[***]]%. The United States also argues that the separate duty rate should be set to 0.00% since
this duty rate was based solely on the individual duty rate calculated for APP -China using the
WTO-inconsistent WA-T methodology with zeroing. 73 China submits that the reduction of the anti -
dumping duty rate to 0.00% is not the same as withdrawal of the anti-dumping duty because, under
the United States' retroactive anti -dumping system, anti -dumping orders are subject to annual
administrative reviews during which the duty rates may change.74 In China's view, the United States'
proposed counterfactual ignores the chilling effect on trade of maintaining an anti-dumping order in
place under the United States' retroactive anti-dumping system.75 China, however, recognizes that
there is insufficient information to estimate the magnitude of this chilling effect.76
5.17. As explained above, the counterfactual must reflect what would have happened if the USDOC
had ceased using the WTO-inconsistent WA-T methodology with zeroing in calculating the dumping

71 See Panel Report, US – Anti-Dumping Methodologies (China), paras. 7.5-7.8. See also United States'
written submission, para. 104.
73 United States' written submission, paras. 104-105.
75 China's response to Arbitrator question No. 6(b), para. 42, and No. 6(c), para. 46.
76 China's response to Arbitrator question No. 58, paras. 32-33.

margin for APP-China by the expiry of the reasonable period of time. Given the factual circumstances
described in paragraph 5.15, we consider it reasonable to assume that, had the USDOC not used
the WA-T methodology with zeroing in calculating the dumping margin for APP-China, it would have
used the de minimis WA-WA dumping margin of [[ ***]]% to determine a 0.00% individual duty
rate for APP -China and to determine a 0.00% separate duty rate for the Chinese exporters that
passed the Separate Rate Test but were not chosen for individual examination.77
5.18. In particular, we note that the de minimis WA-WA dumping margin of [[***]]% was calculated
for APP-China by the USDOC in the relevant anti-dumping proceedings and forms part of the record
in Coated Paper. We also recall that the ori ginal panel's findings of violation concerned only the
USDOC's use of the WA -T methodology with zeroing, which was used in calculating the individual
duty rate for APP-China and the separate duty rate. The original panel's findings of violation did not
concern the USDOC's use of the WA-WA methodology, nor has China taken issue with the de minimis
WA-WA dumping margin of [[***]]% in these arbitration proceedings or suggested that the figures
provided by the United States are not credible.
5.19. With respect to the alleged chilling effect of a 0.00% duty rate, we recall that our task in
these arbitration proceedings is economic in nature, and concerns the estimation of the level of
nullification or impairment caused by the United States' failure to comply with the D SB
recommendations and rulings. This determination must be based on credible, factual, and verifiable
information, not speculation or claims that cannot be meaningfully quantified. China itself recognizes
that there is insufficient information to estimate the magnitude of the alleged chilling effect 78, and
explains that this should not prevent the use of a 0.00% duty rate as the counterfactual. 79 In light
of this, we do not consider that the alleged chilling effect renders a 0.00% duty rate an unreasonable
or implausible counterfactual.
5.20. For these reasons, we consider that the use of a 0.00% duty rate as the counterfactual for
APP-China's individual duty rate and the separate duty rate in Coated Paper reflects a reasonable
and plausible compliance scenario.
5.2.1.2 OCTG
5.21. In the original investigation in OCTG, the USDOC determined that the Chinese exporter TPCO
had engaged in targeted dumping and calculated two dumping margins for this exporter. The first
dumping margin was [[ ***]]% and was calculated using the WA -WA methodology. The second
dumping margin was 32.07% and was calculated using the exceptional WA -T methodology. The
USDOC applied the WA-T methodology with zeroing to all of TPCO's export transactions. Since the
WA-T dumping margin was higher than the WA -WA dumping margin, the USDOC determined that
the WA-WA dumping margin would conceal TPCO's targeted dumping, and therefore used the WA-T
dumping margin to determine TPCO's individual duty rate. 80 The USDOC also used the WA -T duty
rate calculated for TPCO as the separate duty rate assigned to the Chinese exporters that passed
the Separate Rate Test but were not chosen for individual examination.81
5.22. The United States argues that there is no need to us e a counterfactual and that the level of
nullification or impairment is zero, because the individual duty rate calculated for TPCO using the
WTO-inconsistent WA-T methodology with zeroing is 32.07% whereas the duty rate on record for
TPCO calculated using the WA-WA methodology is [[ ***]]%. In light of the difference being less
than [[***]]% points, the United States argues that it is reasonable to assume that the impact on
trade levels would be minimal. 82 China does not explicitly address the United States' arguments
concerning the USDOC's use of the WA-T methodology with zeroing in OCTG.83

77 A similar approach was followed in a previous arbitration pursuant to Article 22.6 of the DSU. (See
Decision by the Arbitrator, US – Washing Machines (Article 22.6 – US), paras. 3.25-3.33).
78 China's response to Arbitrator question No. 58, paras. 32-33.
79 China's comments on the United States' response to Arbitrator question No. 51, paras. 2-3.
80 See Panel Report, US – Anti-Dumping Methodologies (China), paras. 7.5-7.8. See also United States'
written submission, para. 108.
82 United States' written submission, paras. 108-109; and response to Arbitrator question No. 11(a),
para. 35.
83 See China's written submission, para. 193.

5.23. As explained above, the counterfactual must reflect what would have happened if , by the
expiry of the reasonable period of time, the USDOC had ceased using the WTO-inconsistent WA-T
methodology with zeroing in calculating the dumping margin for TPCO. Given the factual
circumstances described in paragraph 5.21 above, we consider it reas onable to assume that, had
the USDOC not used the WA -T methodology with zeroing in calculating the dumping margin for
TPCO, it would have used the WA-WA dumping margin of [[***]]% to determine the individual duty
rate assigned to this exporter and to deter mine the separate duty rate assigned to the Chinese
exporters that passed the Separate Rate Test but were not chosen for individual examination.84
5.24. In particular, we note that the WA-WA dumping margin of [[***]]% was calculated for TPCO
by the USDOC in the relevant anti-dumping proceedings and forms part of the record in OCTG. We
also recall that the original panel's findings of violation concerned only the USDOC's use of the WA-
T methodology with zeroing, which was used in calculating the individual duty rate for TPCO and the
separate duty rate. The original panel's findings of violation did not concern the USDOC's use of the
WA-WA methodology, nor has China taken issue with the WA -WA duty rate in these arbitration
proceedings or suggested that the figures pr ovided by the United States are not based on credible
or factual information.
5.25. We see no basis, in the DSU or elsewhere, for setting the level of nullification or impairment
to zero solely because the difference between the actual duty rate and the counterfactual duty rate
is small, and the impact on trade may accordingly prove small. In support of its view, the
United States refers to the decision by the arbitrator in US – 1916 Act (EC) (Article 22.6 – US), and
argues that it is reasonable to assume that there is no nullification or impairment where "the impact
would be so small that it cannot be 'meaningfully quantified'." 85 We note that the arbitrator in
US – 1916 Act (EC) (Article 22.6 – US) followed an approach under which it did not accept claims
that were "'too remote', 'too speculative', or 'not meaningfully quantified'"86, and on this basis did
not include undisclosed settlement awards in its estimation of the level of nullification or
impairment.87 In these proceedings, the United States has not pointed to any comparable
circumstances, which would cause us to speculate or to include claims that cannot meaningfully be
quantified.88 To the contrary, the relevant figures form part of the official record in OCTG.
5.26. For these reasons, we consider that the use of a [[***]]% duty rate as the counterfactual for
TPCO's individual duty rate and the separate duty rate in OCTG reflects a reasonable and plausible
compliance scenario.
5.2.1.3 Steel Cylinders
5.27. In the Steel Cylinders original investigation, the USDOC determined that the Chinese exporter
BTIC had engaged in targeted dumping and assigned this exporter an individual duty rate of 6.62%
calculated using the WA-T methodology with zeroing.89 The USDOC also used the WA-T duty rate of
6.62% as the separate duty rate assigned to the Chinese exporters that passed the Separate Rate
Test but were not chosen for individual examination. 90 The USDOC revoked the duty rate for BTIC

84 A similar approach was followed in a previous arbitration pursuant to Article 22.6 of the DSU. (See
Decision by the Arbitrator, US – Washing Machines (Article 22.6 – US), paras. 3.25-3.33).
85 United States' response to Arbitrator question No.11(a), para. 35 (quoting Decision by the Arbitrator,
US – 1916 Act (EC) (Article 22.6 – US), para. 6.10).
86 Decision by the Arbitrator, US – 1916 Act (EC) (Article 22.6 – US), para. 5.57.
87 Decision by the Arbitrator, US – 1916 Act (EC) (Article 22.6 – US), para. 6.10.
88 Although the United States argues that there are not sufficient levels of imports from China to use its
first proposed calculation methodology, the Armington model, to estimate the level of nullification or
impairment concerning the USDOC's use of the WA-T methodology with zeroing in OCTG, the United States
does not explain why it cannot estimate the level of nullification or impairment using its second proposed
calculation methodology, the formula-based approach, or another calculation methodology. The United States
initially explained that it did not have data on TPCO's market share prior to the imposition of the anti-dumping
order but has subsequently provided such data for all individual Chinese exporters subject to all of the anti-
dumping orders at issue. (United States' written submission, para. 109; response to Arbitrator question No.
11(b), para. 37; and Excel File with Import Data in the Year Preceding the Imposition of Anti-Dumping Duties,
(Exhibit USA-94 (BCI))).
89 See Panel Report, US – Anti-Dumping Methodologies (China), paras. 7.5-7.8. See also United States'
response to Arbitrator question No. 7, para. 33.
90 United States' response to Arbitrator question No. 7, para. 33.

on 27 August 201791, but continues to assign the duty rate calculated for BTIC using the WA -T
methodology with zeroing as the separate duty rate.92
5.28. The United States argues that there is no need to use a counterfactual and that the level of
nullification or impairment is zero, because the individual duty rate for BTIC was revoked prior to
the expiry of the reasonable period of time.93 Although the separate duty rate continues to be based
solely on the duty rate previously calculated for BTIC using the WTO-inconsistent WA-T methodology
with zeroing, the United States argues that there is no nullification or impairment because China did
not challenge the separate duty rate in the original proceedings. 94 China does not object to the
United States' view that there is no nullification or impairment with respect to BTIC. 95 However,
China argues that the Arbit rator should calculate the level of nullification or impairment caused by
the USDOC's continued use of BTIC's WA-T duty rate of 6.62% as the separate duty rate, by using
a counterfactual duty rate of 0.00%.96
5.29. It is undisputed that the duty rate calculated f or BTIC using the WTO -inconsistent WA -T
methodology with zeroing was revoked prior to the expiry of the reasonable period of time. We
therefore agree with the view, expressed by both parties, that there is no nullification or impairment
with respect to BTIC. We note, however, that the USDOC continues to assign the duty rate calculated
for BTIC using the WTO-inconsistent WA-T methodology with zeroing as the separate duty rate.
While the United States is correct that China, in the original proceedings, did no t challenge the
USDOC's determination regarding the separate duty rate, our task is economic in nature and requires
us to estimate the level of nullification or impairment caused by the U SDOC's use of the WA -T
methodology with zeroing in Steel Cylinders. Since the WA-T duty rate of 6.62% was assigned not
only as the individual duty rate for BTIC but also as the separate duty rate, we consider it reasonable
to assume that, had the USDOC ceased using the WA-T methodology with zeroing in calculating the
individual duty rate for BTIC, it would also not have assigned that duty rate as the separate duty
rate in Steel Cylinders.
5.30. Neither party has pointed to alternative figures from the record of Steel Cylinders that could
be used as the counterfactual for the separate duty rate. In light of this, we cannot speculate on
how the USDOC would have calculated the separate duty rate, had the USDOC not used the duty
rate calculated for BTIC using the WTO-inconsistent WA-T methodology with zeroing as the separate
duty rate. W e therefore consider that a duty rate of 0.00% is a reasonable proxy for what the
separate duty rate would have been, had the USDOC ceased using the WA-T duty rate of 6.62% as
the separate duty rate by the expiry of the reasonable period of time . Indeed, the United States
itself follows this approach in setting out its proposed counterfactual for the USDOC's use of the
WA-T methodology with zeroing in Coated Paper. For this anti -dumping order, the Unit ed States
acknowledges that a duty rate of 0.00% should be used as the counterfactual for both APP -China's
individual duty rate and for the separate duty rate.97 When asked to explain the difference between
its approach in Coated Paper and in Steel Cylinders, the United States suggests that the separate
duty rate in Steel Cylinders should be modified "in a manner consistent with the separate duty rate
the United States used in Coated Paper" and that it "uses a duty rate of zero".98
5.31. For these reasons, we consi der that the use of a 0.00% duty rate as the counterfactual for
the separate duty rate in Steel Cylinders reflects a reasonable and plausible compliance scenario.
5.2.1.4 PET Film
5.32. In the third administrative review in PET Film , the USDOC determined that the Chinese
exporter DuPont Group had engaged in targeted dumping and assigned this exporter an individual

91 United States written submission, para. 102 (referring to High Pressure Steel Cylinders From the
People's Republic of China: Notice of Court Decision Not in Harmony With Final Determination in Less Than Fair
Value Investigation, Notice of Amended Final Determination Pursuant to Court Decision, Notice of Revocation of
Antidumping Duty Order in Part, and Discontinuation of Fifth Antidumping Duty Administrative Review, 82 Fed.
Reg. 46,758 (6 October 2017) (Exhibit USA-7)).
92 United States' response to Arbitrator question No. 7, para. 33.
94 United States' response to Arbitrator question No. 7, paras. 33-34.
95 China's response to Arbitrator question No. 60(a), para. 34.
96 China's response to Arbitrator question No. 60(b), para. 35.
98 United States' response to Arbitrator question No. 59, para. 45.

duty rate of 3.49% calculated using the WTO-inconsistent WA-T methodology with zeroing. 99 The
USDOC also used the WA -T duty rate of 3.49% as the separate duty rate assigned to the Chinese
exporters that passed the Separate Rate Test but were not chosen for individual examination.100 In
the fourth administrative review, published on 2 July 2014, the USDOC did not choose the DuPont
Group for individual examination and, thus, did not calculate an individual duty rate for the DuPont
Group through either the WA-WA methodology or the WA-T methodology with zeroing. Rather, the
DuPont Group was assigned the separate duty rate of 31.24% based on the duty rates calculated
for two individually examined exporters, neither of which were calculated using the WA -T
methodology with zeroing.101
5.33. The United States argues that there is no need to use a counterfactual a nd that the level of
nullification or impairment is zero, because the individual duty rate that had been calculated for the
DuPont Group through the WA-T methodology with zeroing was, prior to the expiry of the reasonable
period of time, replaced by the se parate duty rate that had been calculated in a WTO -consistent
manner. China submits that, under the United States' retroactive anti-dumping system, the DuPont
Group's duty rate could be subject to administrative reviews in future years. Since the United States
has not taken steps to implement the DSB recommendations and rulings concerning the USDOC's
use of the WA-T methodology with zeroing, the USDOC could recalculate the DuPont Group's duty
rate using this methodology in future proceedings.102
5.34. In our view, by replacing the DuPont Group's individual duty rate with a duty rate that was
not calculated using the WTO-inconsistent WA-T methodology with zeroing, the USDOC has
withdrawn its use of that methodology in calculating the individual duty rate for the Du Pont Group.
China is right in arguing that the USDOC might calculate duty rates for the DuPont Group in future
administrative reviews, using the WA-T methodology with zeroing. However, we recall that China's
claims and the panel's findings in the original pr oceedings concerned only the USDOC's use of the
WA-T methodology with zeroing "as applied" in the third administrative review in PET Film.103 They
did not concern the USDOC's potential future use of this methodology in subsequent administrative
reviews. Our mandate is, as mentioned above, to determine the level of nullification or impairment
by comparing the existing level of trade for China under the WTO -inconsistent measure with the
expected level of trade for China, had the United States brought its WTO-inconsistent measure into
conformity by the expiry of the reasonable period of time. In PET Film, the United States ceased its
use of the WTO-inconsistent WA-T methodology with zeroing prior to the expiry of the reasonable
period of time, and we therefore have no basis for estimating any level of nullification or impairment
with respect to the USDOC's use of the WA-T methodology in this anti-dumping order. In our view,
it would be too speculative to consider the possibility that the USDOC might reintroduce it s use of
the WA-T methodology with zeroing in calculating the duty rate for the DuPont Group during future
administrative reviews.
5.35. For these reasons, we consider that there is no nullification or impairment caused by the
USDOC's use of the WTO-inconsistent WA-T methodology in PET Film.
5.2.2 Counterfactual for the USDOC's use of the WTO-inconsistent Single Rate
Presumption
5.2.2.1 Assessment by the Arbitrator
5.36. As mentioned above, the original panel's findings of violation concerning the USDOC's use of
the WTO-inconsistent Single Rate Presumption cover all of the 25 anti -dumping orders at issue,
including the four anti-dumping orders covered by the USDOC's use of the WTO-inconsistent WA-T
methodology with zeroing. More particularly, in the proceedings resulting in the 25 an ti-dumping
orders at issue, the USDOC presumed that all Chinese exporters comprised a single PRC-wide entity

99 See Panel Report, US – Anti-Dumping Methodologies (China), paras. 7.5-7.8. See also United States'
100 United States' response to Arbitrator question No. 7, para. 30.
101 United States' response to Arbitrator question No. 7, para. 31.
102 China's response to Arbitrator question No. 9, paras. 50-52.
103 See Panel Report, US – Anti-Dumping Methodologies (China), paras. 3.1.b, 7.239, and 8.1.b.

and assigned these exporters a single PRC -wide duty rate unless they overcame the Single Rate
Presumption by passing the Separate Rate Test.104
5.37. The United States argues that, for the purpose of determining the correct counterfactual, the
Chinese exporters within the PRC-wide entity should be divided into two groups: exporters "for which
there is evidence that they failed to cooperate" and exporters "fo r which there is no evidence that
they failed to cooperate".105 For the first group of exporters, the United States argues that there is
no need to use a counterfactual, because these exporters' failure to cooperate renders it reasonable
to continue assigning them the PRC-wide duty rate, which is calculated on the basis of adverse facts
available.106 For the second group of exporters, the United States proposes to use the separate duty
rates on record as the counterfactual. 107 In the United States' view, the original panel's findings of
violation concerning the use of the Single Rate Presumption would not necessarily require the USDOC
to individually examine each exporter within the PRC -wide entity. Rather, they would allow the
USDOC to limit its examination under Article 6.10 of the Anti-Dumping Agreement and assign these
exporters the separate duty rate, assigned to other Chinese exporters that had initially passed the
Separate Rate Test but where not chosen for individual examination.108
5.38. China objects to the United States' proposal to continue assigning the PRC-wide duty rate to
exporters within the PRC -wide entity for which there is evidence that they failed to cooperate. In
this regard, China distinguishes between exporters that believed that they provided a ll necessary
information to the USDOC and exporters that did not. For the former, China argues that the use of
a duty rate based on facts available is WTO-inconsistent. For the latter, China recognizes that facts
available could be used but argues that the se should have been "neutral", not "adverse", facts
available.109 China also objects to the United States' proposal to use the separate duty rates on
record as the counterfactual for exporters within the PRC-wide entity for which there is no evidence
that th ey failed to cooperate. In this regard, China argues that the United States' proposed
counterfactual assumes that the separate duty rates on record are WTO-consistent which, in China's
view, is not the case. In this regard, China lists a "range of likely W TO-inconsistencies"110, namely
the USDOC's improper use of adverse facts available 111; the USDOC's improper use of "double -
counting" duties from anti -dumping and countervailing duty investigations 112; and the USDOC's
improper use of differential pricing as well as the WA-T methodology with zeroing.113
5.39. The parties' arguments raise the issue of whether we, in our role as an arbitrator acting
pursuant to Article 22.6 of the DSU, can take into account the proposed counterfactual's consistency
with WTO obligations other than those that formed the basis of the original panel's findings of
violation. The parties have expressed opposing views on this issue. The United States is of the view
that an examination of the "likely" WTO inconsistency of its proposed counterfactual would go

104 See e.g. Panel Report, US – Anti-Dumping Methodologies (China), para. 7.311.
106 United States' written submission, paras. 40-41; and response to Arbitrator question No. 55(d),
para. 41. Although, in setting out its counterfactual, the United States generally distinguishes between
exporters based on their cooperation, it only relies on that distinction when applying its proposed calculation
methodologies to five anti-dumping orders, namely Furniture; OCTG; OTR Tires; Solar Cells; and Wood
Flooring. For the remaining 20 anti-dumping orders, the United States does not rely on the distinction between
non-cooperating and cooperating exporters in applying its calculation methodologies, due to lack of data.
Instead, the United States estimates the level of nullification or impairment based on a counterfactual scenario
where all exporters within the PRC-wide entity, regardless of whether they cooperated or not, are assigned the
separate duty rate instead of the PRC-wide duty rate. The United States argues that, in doing so, it is
overestimating the level of nullification or impairment. (United States' written submission, paras. 93-96; and
responses to Arbitrator question No. 3(a), para. 3, and No. 55(a), para. 27).
107 United States' written submission, paras. 40-41. For three anti-dumping orders, namely Iron Pipe
Fittings; Steel Flat Products; and Residential Washers, there is no separate duty rate on record and the
United States therefore proposes to use a proxy of 0.00% as the counterfactual duty rate for the exporters
within the PRC-wide entity for which there is no evidence that they failed to cooperate. (United States' written
submission, para. 76; and response to Arbitrator question No. 51, para. 5). For two anti-dumping orders,
namely Diamond Sawblades and Steel Products, the separate duty rate on record is the same as the PCR-wide
duty rate, and the United States therefore argues that there is no nullification or impairment. (United States'
written submission, paras. 57-59).
108 United States' response to Arbitrator question No. 3(b)(i), paras. 4 and 9.
109 China's response to Arbitrator question No. 56, paras. 26-29.
110 China's written submission, paras. 217-218.
111 China's written submission, paras. 220-228.
112 China's written submission, paras. 229-230.
113 China's written submission, paras. 231-234.

beyond the DSB recommendations and rulings and thus beyond the mandate under Article 22.6 of
the DSU.114 China, on the other hand, argues that the DSU makes it clear that a determination of
the level of nullification or impairment under Article 22.6 of the DSU must be measured against a
WTO-consistent benchmark. While China agrees that an arbitrator cannot make "formal" findings of
WTO inconsistency, it argues that an arbitrator has the authority to consider the likely WTO
consistency of a proposed counterfactual as a part of its determination of whether that counterfactual
is reasonable.115
5.40. We recall that there is a difference between, on the one hand, assessing the WTO consistency
of a measure or a measure taken to comply with the DSB recommendations and rulings, and, on the
other hand, assessing whether a proposed counterfactual represents a reasonable or plausible
compliance scenario. We agree with the view expressed by both parties that it is not for us to make
findings of WTO inconsistency with respect to a measure or a measure taken to comply with the DSB
recommendations and rulings. This is the mandate of a panel acting pursuant to Article 11 of the
DSU or a compliance panel acting pursuant to Article 21.5 of the DSU. Our mandate is to assess a
hypothetical counterfactual and determine whether this counterfactual reflects at least a reasonable
or plausible compliance scenario. In our view, it would be incongruous to assess whether a
counterfactual reflects a reasonable or plausible compliance scena rio without considering that
counterfactual's WTO consistency. In this regard, we recall that compliance requires full consistency
with WTO obligations, not just those forming part of the original proceedings. 116 In considering
whether the United States' proposed counterfactual reflects a reasonable or plausible compliance
scenario, we will therefore take into account that counterfactual's WTO consistency with the covered
agreements.117 We will not limit this assessment to the provisions that were found to have been
violated in the original proceedings. We see no basis for distinguishing, in fulfilling our mandate to
determine a reasonable or plausible compliance scenario, between WTO obligations that were found
to have been violated in the original proceedings and other WTO obligations . In our view, this
distinction is arbitrary as it would compel an arbitrator to accept a proposed counterfactual without
any regard to its inconsistency with other relevant WTO obligations. Such an approach would, in our
view, fall short of fulfilling an arbitrator's mandate under Article 22.6, and would diminish the
effectiveness of the WTO dispute settlement system . With this in mind, we now turn to our
assessment of the particular elements of the counterfactual that the United States proposes.
5.41. First, we address the United States' proposal to divide the Chinese exporters within the
PRC-wide entity into groups based on their cooperation, and to continue assigning the PRC -wide
duty rate to exporters "for which there is evidence that they failed to cooperate". The United States
argues that these exporters' failure to cooperate entails that they could have been assigned a duty
rate based on adverse facts available even if they were not part of the PRC -wide entity.118 In this
regard, we recall that Article 6.8 of the Anti-Dumping Agreement permits an investigating authority
to base its determination s on facts available where an interested party "refuses access to, or
otherwise does not provide, necessary information within a reasonable period or significantly
impedes the investigation". In using facts available, an investigating authority must comply with the
provisions of Annex II, which provides for a process aimed at ensuring the use of the best facts
available. In this regard, we recall that, while an interested party's failure to cooperate could lead
to a result that is less favourable to the par ty than if it had cooperated, cooperation is "a process,
involving joint effort" by the relevant party and the investigating authority and "the fact of
'cooperating' is in itself not determinative of the end result of the cooperation".119
5.42. Despite arguing that there are exporters within the PRC-wide entity for which there is evidence
that they failed to cooperate, the United States explains that the USDOC did not make a
determination that any individual exporter within the PRC-wide entity failed to cooperate within the
meaning of Article 6.8 and Annex II. Although the United States distinguishes, in these proceedings,
between exporters within the PRC-wide entity based on their cooperation, it acknowledges that the
USDOC made no such distinction in the actual investigations and administrative reviews underlying

114 United States' response to Arbitrator question No. 54(b), paras. 13-14.
115 China's response to Arbitrator question No. 54(a), paras. 11-15.
116 See Appellate Body Report, EC – Bed Linen (Article 21.5 – India), para. 79. See also Appellate Body
117 Previous arbitrators have also considered counterfactuals that were WTO-consistent. (See Decisions
by the Arbitrators, EC – Bananas III (Ecuador) (Article 22.6 – EC), para. 166; and EC – Bananas III (US)
(Article 22.6 – EC), para. 7.1).
118 United States' written submission, para. 40 and fn 35.
119 Appellate Body Report, US – Hot-Rolled Steel, para. 99.

the anti-dumping orders at issue. More particularly, the USDOC did not make determinations of
non-cooperation that were "specific" to individual exporters within the PRC-wide entity120, but rather
determined that the PRC-wide entity "as an entity" failed to cooperate.121
5.43. The gist of the original panel's findings of violation concerning the Single Rate Presumption is
that the USDOC acted inconsistently with its WTO obligations in treating multiple exporters as a
single PRC-wide entity and assigning these exporters a single PRC-wide duty rate on the basis of a
presumption rather than an affirmative determination that these exporters were in such a
relationship that they could be treated as a single entity .122 No evi dence has been submitted
indicating that the USDOC subsequently made any such affirmative determination for all or some of
the exporters within the PRC-wide entity. Considering this, we have difficulty understanding how the
USDOC's determination of non-cooperation by the PRC-wide entity "as an entity" could serve as a
basis to assign individual exporters within the PRC -wide entity a duty rate based on adverse facts
available. In our view, assigning the PRC-wide duty rate to the group of exporters for which there is
evidence that they failed to cooperate would perpetuate the treatment of multiple exporters as a
PRC-wide entity, albeit one with fewer exporters in it. In the absence of an affirmative determination
concerning their relationship, such monolithic treatment of a group of exporters would, in our view,
contravene the original panel's findings of violation concerning the Single Rate Presumption.
Therefore, considering that the USDOC did not determine that any of the individual exporters within
the PRC-wide entity failed to cooperate, we believe it would be too speculative to assume that the
USDOC could continue assigning individual exporters within the PRC-wide entity the PRC-wide duty
rate.
5.44. Furthermore, we recall that, where an interested party does not provide necessary information
and the investigating authority decides to make its determination on the basis of facts available, it
must follow the process set out in Annex II in order to ensure that it uses the best facts available.
When asked whether the USDOC followed the process set out in Annex II for the exporters within
the PRC-wide entity for which there is evidence that they failed to cooperate, the United States
reiterates its explanation that the USDOC did not make findings of non-cooperation that were specific

120 United States' response to Arbitrator question No. 55(b), para. 33.
121 United States' response to Arbitrator question No. 4, para. 15. The United States explains that the
USDOC's determinations of non-cooperation in some instances "identif[ied] by name certain companies in the
China-government entity that did not cooperate", and in other instances were "more general, focusing on the
type of non-cooperative behavior". (United States' response to Arbitrator question No. 4, para. 16). The
United States provides one example to demonstrate how it identifies non-cooperating exporters where the
USDOC's determination of non-cooperation was "more general": For OTR Tires, the United States submits that
90 exporters received a quantity and value (Q&V) questionnaire, but only 14 exporters provided responses to
this questionnaire whereas 76 exporters did not. On this basis, the United States argues that there is evidence
that 84.4% of the exporters in the PRC-wide entity failed to cooperate and that 84.4% of the PRC-wide entity's
imports should continue to be subject to the PRC-wide duty rate of 105.31%. (See United States' response to
Arbitrator question No. 55(a), paras. 30-32; US Federal Register Notices Regarding Preliminary Determinations
in Anti-Dumping Duty Investigations, (Exhibit USA-51), pp. 9278-9279; Information on Response Rate to
USDOC Q&V Questionnaire in Anti-Dumping Duty Investigations, (Exhibit USA-55), p. 1; and Table of Relevant
Anti-Dumping Duty Rates, (Exhibit USA-5), p. 1). We note that there are certain issues with this approach.
More particularly, when examining the record of OTR Tires, it appears that 94 exporters received a Q&V
questionnaire and that 30 exporters responded. The United States itself quotes these figures but uses other
figures to determine the percentage of non-cooperating exporters without further explanation. (United States'
response to Arbitrator question No. 55(a), para. 31 (quoting US Federal Register Notices Regarding Preliminary
Determinations in Anti-Dumping Duty Investigations, (Exhibit USA-51), pp. 9278-9279)). Moreover, and as
pointed out by China, in calculating the percentage of non-cooperating exporters, the United States does not
identify any specific individual exporters and their volume or share of imports. (China's comments on the
United States' response to Arbitrator question No. 55(a), paras. 23-27). Rather, the United States calculates
the share of non-cooperating exporters based on an assumption that all exporters within the PRC-wide entity
account for exactly the same, average share of imports, without providing any explanation regarding the
reasonableness of this assumption.
122 We recall that, in the original proceedings, China presented claims, among others, under Article 6.8
and Annex II of the Anti-Dumping Agreement, challenging the USDOC's use of adverse facts available in
determining the PRC-wide duty rate. The original panel applied judicial economy to those claims. In doing so,
the original panel emphasized that China's claims concerned the USDOC's use of adverse facts available in
determining the PRC-wide entity's duty rate, and that therefore it would not be appropriate for the panel to
make findings concerning the use of adverse facts available for individual exporters within the PRC-wide entity.
(Panel Report, US – Anti-Dumping Methodologies (China), paras. 7.494-7.495). Hence, even if the original
panel had made findings on China's claims under Article 6.8 and Annex II of the Anti-Dumping Agreement,
such findings would not have been relevant to our assessment of the reasonableness or plausibility of the
counterfactuals proposed in these proceedings.

to individual exporters within the PRC -wide entity.123 To us, this suggests that the USDOC did not
follow the Annex II process in order to determine which facts available to use in calculating duty
rates for the individual export ers within the PRC -wide entity for which there is evidence that they
failed to cooperate. This further supports our view that it would be too speculative to assume that
the USDOC could have continued assigning individual exporters within the PRC-entity the PRC-wide
duty rate, which was calculated on the basis of facts available chosen for that entity.
5.45. Considering that the USDOC did not make findings of non-cooperation nor follow the process
under Article 6.8 and Annex II for individual exporters within the PRC-wide entity, we do not consider
that the continued use of the PRC -wide duty rate reflects a reasonable or plausible compliance
scenario for any of the individual exporters within the PRC -wide entity. Instead, we will determine
an appropriate counterfactual for all exporters within the PRC-wide entity.
5.46. Having rejected the United States' proposal to divide the Chinese exporters within the
PRC-wide entity into groups based on their cooperation, we next have to determine an appropriate
counterfactual for all exporters within the PRC-wide entity. That is, what duty rate would have been
assigned to the exporters within the PRC-wide entity, had the USDOC ceased using the Single Rate
Presumption by the expiry of the reasonable period of time, and thus not includ ed these exporters
in the PRC-wide entity and assigned them the PRC -wide duty rate? We recall that, in its proposed
counterfactual, the United States suggests using the separate duty rates on the record of the anti -
dumping orders at issue.
5.47. Article 6.10 of the Anti-Dumping Agreement requires an investigating authority to determine,
as a rule, individual duty rates for all exporters, but permits limited examination of selected exporters
where the number of exporters is so large that individual examination of each exporter would be
"impracticable".124 If, however, an exporter has provided the necessary information in time, the
investigating authority must calculate an individual duty rate, unless the number of exporters is so
large that individual examination wou ld be "unduly burdensome" and prevent the "timely
completion" of the investigation.125 That is, even in cases where the investigating authority limits its
examination, it must nevertheless calculate individual duty rates for exporters that so request,
unless doing so would be unduly burdensome and prevent the timely completion of the investigation.
5.48. The United States explains that the USDOC limited its examination in the proceedings
resulting in the anti-dumping orders at issue, and assigned the separate duty rate to exporters that
passed the Separate Rate Test but were not chosen for individual examination.126 The United States
submits that it would also be reasonable to use the separate duty rates on record as the
counterfactual duty rates for the exporters within the PRC-wide entity.127 We recall that, under the
Single Rate Presumption, the USDOC treats all exporters that did not pass the Separate Rate Test
as a single PRC-wide entity and assigns them a single PRC-wide duty rate. In doing so, the USDOC
does not provide these exporters with the opportunity to request individually calculated duty rates
despite the USDOC's decision to limit its examination with regard to exporters that pass the Separate
Rate Test.
5.49. We consider the United States' proposed counterfactual too speculative because it assumes
that the exporters within the PRC-wide entity would necessarily be subject to the separate duty rate
on record, had the USDOC ceased treating them as a single PRC -wide entity under the Single Rate
Presumption. This approach ignores the fact that Article 6.10.2 of the Anti -Dumping Agreement
provides the exporters that are not initially selected for individual examination with the right to
request individual examination, and requires the investigating authority to conduct such an individual
examination unless the authority finds that it would be unduly burdensome and prevent the timely
completion of the investigation. In light of this provision, it would not be reasonable to assume that
none of the exporters wi thin the PRC -wide entity would have requested such an individual
examination or that the USDOC would have been permitted to reject all of them by reason of the
burdensome impact on the investigation. We also note that, in certain of the anti-dumping

123 United States' response to Arbitrator question No. 55(b), paras. 33-35.
124 Article 6.10 of the Anti-Dumping Agreement.
125 Article 6.10.2 of the Anti-Dumping Agreement.
126 As mentioned in fn 107 above, there is no separate duty rate on the record of three anti-dumping
orders, namely Iron Pipe Fittings; Residential Washers; and Steel Flat Products, and the United States
therefore proposes to use a proxy of 0.00% as the counterfactual duty rate. (United States' written
submission, para. 76; and response to Arbitrator question No. 51, paras. 3-7).
127 United States' response to Arbitrator question No. 3(b)(i), paras. 4-5 and 8-9.

proceedings at issue, the PRC -wide entity includes exporters that the USDOC initially chose for
individual examination but subsequently included in the PRC -wide entity. 128 It would not be
reasonable to assume that the USDOC could have assigned the separate duty rate to such exporters,
which, initially, had been selected for individual examination. These considerations suggest that the
use of the separate duty rates on record as the counterfactual for the exporters within the PRC-wide
entity does not reflect a reasonable or plausible compliance scenario.
5.50. We also recall that, where an investigating authority has limited its examination to selected
exporters, Article 9.4 of the Anti -Dumping Agreement requires that the duty rate assigned to
exporters that were not chosen for individual examination not exceed the weighted average of the
individual duty rates calculated for selected exporters, disregarding any zero or de minimis duty
rates or duty rates based on facts available. We asked the United States to explain whethe r the
separate duty rate in the United States' anti-dumping system corresponds to the duty rate set out
in Article 9.4. We also asked the United States to explain whether the USDOC took into account the
provisions of Article 9.4 in calculating the separate duty rates on the record of the anti -dumping
orders at issue. The United States did not provide a clear answer to these questions but stated that
"the USDOC generally calculates the separate duty rate based on the rates assigned to individually-
examined r espondents."129 The United States acknowledges that the USDOC, in certain
anti-dumping proceedings at issue, calculated the separate duty rates as an average of one or more
individual duty rates based on adverse facts available.130 The United States also acknowledges that
the USDOC, in certain anti-dumping proceedings at issue, calculated the separate duty rates based
on information provided by the domestic industry in the petition for initiation of an investigation, or
based on duty rates calculated in prior a nti-dumping proceedings.131 These explanations show that
what is called "the separate duty rate" in the United States' anti-dumping system is not necessarily
calculated pursuant to the provisions of Article 9.4 of the Anti-Dumping Agreement. In considering
whether the use of the separate duty rates on record reflects a reasonable or plausible compliance
scenario, we cannot disregard the fact that the United States itself does not purport that the USDOC
calculated the separate duty rates pursuant to the provisions of Article 9.4.132 This further supports
our view that the use of the separate duty rates on record as the counterfactual for the exporters
within the PRC-wide entity does not reflect a reasonable or plausible compliance scenario.
5.51. When asked whether the re are alternative duty rates, other than the separate duty rates,
which could serve as a reasonable or plausible counterfactual for the exporters within the PRC-wide
entity, the United States generally submits that there are no such alternatives.133 China argues that
it would be reasonable to use either withdrawal of the anti -dumping order, a 0.00% duty rate, or
"the lowest dumping margin that at least has some basis in the record of each proceeding, but the
parties agree is reasonable." 134 China provides a li st of potential alternative duty rates, which are
based on individual duty rates calculated for selected exporters during different time periods,

128 See Panel Report, US – Anti-Dumping Methodologies (China), para. 7.503.
129 United States' response to Arbitrator question No. 52, para. 9.
130 United States' response to Arbitrator question No. 53(a), para. 11; and comments on China's
response to Arbitrator question No. 53(b), paras. 5-6. Like the United States, China also submits that the
USDOC, in some of the anti-dumping orders at issue, calculated the separate duty rates on the basis of
individual duty rates calculated based on adverse facts available. China further argues that the USDOC made
improper use of adverse facts available in calculating the individual duty rates on which the separate duty rates
were based. In support of its view, China refers to the Appellate Body Report in US – Hot-Rolled Steel. (China's
written submission, paras. 220-228).
131 United States' response to Arbitrator question No. 52, para. 9.
132 We also note China's argument that the use of the separate duty rates on record as the
counterfactual duty rates for the exporters within the PRC-wide entity would not be reasonable because such
duty rates are WTO-inconsistent for reasons in addition to those we discussed in detail in paragraph 5.50. In
this regard, China contends that some of the separate duty rates on record are tainted because they were
calculated in proceedings where the USDOC imposed both anti-dumping and countervailing measures and
failed to adjust the separate duty rates for domestic subsidies. In support of its view, China refers to the
Appellate Body's report in US – Countervailing and Anti-Dumping Measures (China). (China's written
submission, paras. 229-230). China also contends that some of the separate duty rates on record are tainted
by the USDOC's improper use of the WA-T methodology and zeroing. In support of its view, China refers to the
Appellate Body's reports in US – Washing Machines, US – Zeroing (Japan), and US – Stainless Steel (Mexico).
(China's written submission, paras. 231-234).
133 United States' response to Arbitrator question No. 54(c), paras. 25-26. For three anti-dumping
orders, the United States argues that it could increase the counterfactual duty rates by relying on either
individual duty rates calculated for selected exporters or the separate duty rates calculated during the most
recent administrative reviews. (Ibid).
134 China's comments on the United States' response to Arbitrator question No. 54(d), para. 14.

separate duty rates calculated during different time periods, or averages thereof. 135 Each party
criticizes the other's approach as selective and as either exaggerating or underestimating the level
of nullification or impairment. 136 We recall that, in determining the appropriate counterfactual for
the USDOC's use of the WA -T methodology with zeroing, w e used alternative duty rates from the
record that were specifically calculated by the USDOC for the exporters at issue in the relevant
anti-dumping proceedings. However, the USDOC did not calculate such alternative duty rates for the
exporters within the PRC-wide entity. In light of this, we cannot speculate on how the USDOC would
have calculated the duty rates for the exporters within the PRC -wide entity, had they not been
included in the PRC -wide entity and assigned the PRC -wide duty rate pursuant to the Single Rate
Presumption. We therefore consider it reasonable to apply, as a proxy, a duty rate of 0.00% as the
counterfactual for the exporters within the PRC-wide entity.
5.52. For these reasons, we consider that the use of a 0.00% duty rate as the counterfact ual for
the exporters within the PRC -wide entity in all anti -dumping orders at issue reflects a reasonable
and plausible compliance scenario.
5.2.2.2 Separate opinion of one member of the Arbitrator
5.53. I generally agree with the majority that, for the purpose of arbi tration proceedings under
Article 22.6 of the DSU, a reasonable or plausible counterfactual should be one that, at least, is
consistent with the covered agreements. I, however, disagree with the majority on how to assess
whether a proposed counterfactual i s consistent with the covered agreements. Specifically, in my
view, when considering the possibil ity of taking into account potential inconsistencies with WTO
obligations other than those that were found to have been violated in the original proceedings,
particular and extra restraint should be exercised . Otherwise, the careful balance between, on the
one hand, Articles 11 and 21.5 of the DSU and, on the other hand, Article 22.6 of the DSU may be
disturbed. This difference in views necessarily leads me to reach conclusions different from those of
the majority on two important issues related to the counterfactual adopted in these proceedings.
5.54. The first issue concerns the group of Chinese exporters within the PRC-wide entity to which
the counterfactual duty will apply. In this regard, the United States divides the exporters within the
PRC-wide entity into two groups, namely those for which there is evidence that they failed to
cooperate and those for which there is no evidence that they failed to cooperate. 137 On this basis,
the United States argues that the counterfactual duty should only apply to the latter group of
exporters because the USDOC could legitimately continue assigning the former group of exporters
duties on the basis of adverse facts available becau se they failed to cooperate.138 China disagrees,
arguing that for some of the exporters, for which the United States considers there is evidence that
they failed to cooperate, the USDOC should not have applied facts available at all and for others it
should have applied "neutral", as opposed to "adverse", facts available.139
5.55. The majority has decided to apply the counterfactual duty to all exporters within the PRC-wide
entity, expressing the view that in assessing the reasonableness or plausibility of the counterfactual,
its consistency with the covered agreements should be taken into account. In the majority's vie w,
this assessment should not be limited to those provisions of the covered agreements that formed
the basis of the original panel's findings of violation.140
5.56. I am fully aware that the adoption of a reasonable or plausible counterfactual in an arbitration
proceeding under Article 22.6 is, by its very nature, based on a hypothetical. This is because such
an arbitration proceeding is triggered by the fact that the original respondent failed to fully comply
with the DSB recommendations and rulings in the original proceedings, and that the arbitrator acting
pursuant to Article 22.6 is left to determine what would be a reasonable or plausible compliance
scenario. Depending on the nature of the WTO -inconsistent measure, identifying such a
counterfactual may not be overly complex. In this regard, I recall that in a number of past arbitration

135 China's response to Arbitrator question No. 54(e), paras. 20-23; and China's Identification of
Suitable Benchmarks for All Other Anti-Dumping Duty Rates, (Exhibit CHN-53).
136 See China's comments on the United States' response to Arbitrator question No. 54(e), para. 17; and
United States' comments on China's response to Arbitrator question No. 54(e), paras. 13-14.
137 United States' written submission, paras. 40-41.
138 United States' written submission, paras. 40-41.
139 China's response to Arbitrator question No. 56, paras. 26-29.
140 See para. 5.40 above.

proceedings, the arbitrators considered the withdrawal of the measure a reasonable or plausible
compliance scenario, and the parties did not contest such an approach. 141 The WTO-inconsistent
measures at issue in these proceedings, however, are much more complex in nature and therefore
the adoption of an appropriate counterfactual has proved to be more challenging compared with
some of the past arbitration proceedings. Indeed, anti-dumping duties are adopted as a result of an
investigative process involving not only strict procedural rules that have to be followed by the
investigating authorities but also a host of rules that govern the substantive determinations. Thus,
compared with most other measures, anti-dumping measures could potentially be inconsistent with
many WTO obligations.
5.57. In the present proceedings, the majority took into account violations of the provisions of the
Anti-Dumping Agreement other than those found by the DSB in the original proceedings, in
considering whether the proposed counterfactual was reasonable or plausible . Specifically, the
majority considered that it would be too speculative to assume that the USDOC could, pursuant to
Article 6.8 and Annex II of the Anti-Dumping Agreement, continue applying the duty rates calculated
on the basis of adverse facts available vis-à-vis the exporters for which, in the view of the
United States, there is evidence that they failed to cooperate. On this basis, the majority concluded
that the counterfactual duty rate should apply to the entirety of the exporters within the PRC -wide
entity.142 I recall that in the original proceedings in this dispute, there was no finding of violation of
Article 6.8 or Annex II of the Anti-Dumping Agreement.
5.58. I am of the view that the majority has not applied extra and particular restraint by taking into
account the proposed counterfactual's inconsistency with WTO obligations other than those found to
have been violated in the original proceedings. Therefore, I disagree with the majority's approach
and consider that only the provisions forming the basis of the original panel's findings of violations
should have been taken into account. In my view, the counterfactual duty should therefore have
applied only to those exporters within the PRC-wide entity for which, in the view of the United States,
there is no evidence that they failed to cooperate in the relevant investigations.
5.59. I conclude by noting that applying the counterfactual duty to all exporters within the PRC-wide
entity, in my view, affects the level of nullification or impairment, and disregards the right of WTO
Members, enshrined in Article VI of the GATT 1994, to offset and prevent injurious dumping.
5.60. The second issue concerns the rate of the counterfactual duty. I recall that the United States
proposes to apply the separate duty rates on the record of the relevant anti-dumping orders as the
counterfactual duty rate to the Chinese exporters within the PRC -wide entity for which, in the view
of the United States, there is no evidence that they failed to cooperate.143 China disagrees with this
view, arguing that the separate duty rates are likely inconsistent with a range of WTO obligations.144
5.61. Having concluded that the counterfactual duty rate should apply to all exporters within the
PRC-wide entity, the majority considered that it would not be reasonable to assume that the USDOC
could have refused to individually examine the exporters within the PRC -wide entity and assigned
the separate duty rates to these exporters pursuant to Article 6.10.2 of the Anti -Dumping
Agreement, nor to assume that such duty rates would be consistent with Article 9.4 of the Anti -
Dumping Agreement.145 Here too, in the original proceedings in this dispute, there was no finding of
violation of any of these two provisions.
5.62. I am of the view that the majority did not apply extra and particular restrain t by taking into
account WTO obligations other than thos e that were found to have been violated in the original
proceedings. Therefore, I disagree with the majority's approach and consider that only the provisions
forming the basis of the original panel's findings of violation should have been taken into accoun t.
The counterfactual duty rate should therefore have been the separate duty rates on the record of
the relevant anti -dumping orders, not the proxy of 0.00% applied by the majority. Here too,

141 See e.g. Decisions by the Arbitrators, EC – Hormones (US) (Article 22.6 – EC), para. 38; US – COOL
(Article 22.6 – US), paras. 3.10-3.12; and US – Tuna II (Mexico) (Article 22.6 – US), paras. 4.8-4.10.
142 See paras. 5.41-5.45 above.
143 United States' written submission, paras. 40-41; and response to Arbitrator question No. 3(b)(i),
paras. 4-5 and 8-9.
144 China's written submission, paras. 220-238 (referring to Articles 2.4.2, 6.8, and 9.3 and Annex II of
the Anti-Dumping Agreement and Article 19.3 of the Agreement on Subsidies and Countervailing Measures).
145 See paras. 5.46-5.52 above.

I conclude by noting that applying a 0.00% counterfactual duty rate, rather than the separate duty
rates, in my view, affects the level of nullification or impairment, and disregards the right of WTO
Members, enshrined in Article VI of the GATT 1994, to offset and prevent injurious dumping.
5.3 Conclusion
5.63. For the reasons set out in the preceding sections, we will use the following counterfactual for
the purpose of estimating the level of nullification or impairment: With respect to Coated Paper, we
will use a 0.00% duty rate as the counterfactual for the exporter APP -China, for the exporters that
receive the separate duty rate, and for the exporters within the PRC -wide entity. With respect to
OCTG, we will use a [[ ***]]% duty rate as the counterfactual for the exporter TPCO and for the
exporters that receive the separate dut y rate, and we will use a 0.00% duty rate as the
counterfactual for the exporters within the PRC-wide entity. With respect to Steel Cylinders, we will
use a 0.00% duty rate as the counterfactual for the exporters that receive the separate duty rate
and for the exporters within the PRC-wide duty entity. With respect to Aluminum Extrusions, Bags,
Diamond Sawblades, Furniture, OTR Tires, PET Film, Ribbons, Shrimp, Solar Panels, Wood Flooring,
Copper Pipe and Tube , Iron Pipe Fittings , Passenger Vehicle and Light Truck Tires , Residential
Washers, Sheet and Strip, Steel Flat Products, Steel Line Pipe, Steel Nails, Steel Pipe, Steel Products,
Steel Standard, Line, and Pressure Pipe, and Steel Wire Rod, we will use a 0.00% duty rate as the
counterfactual for all of the exporters within the PRC -wide entity. We will maintain all other duty
rates imposed under the anti-dumping orders at issue, without any modification.
6 ARBITRATOR'S DETERMIN ATION OF THE APPROPR IATE METHODOLOGY FOR
ESTIMATING THE LEVEL OF NULLIFICATION OR IMPAIRMENT
6.1. In the section above, we have determined the appropriate counterfactual for the United States'
compliance with the DSB recommendations and rulings by the expiry of the reasonable period of
time. As explained in detail in paragraph 5.63, we use, as the counterfactual, the reduction of the
duty rates that were based on the USDOC's WTO -inconsistent use of the WA -T methodology with
zeroing and the Single Rate Presumption in the anti-dumping orders at issue.
6.2. We now turn to determine the appropriate methodology for estimating the level of nullification
or impairment by calculating what would have happened, in terms of trade flows, had the
United States complied with the DSB recommendations and rulings by the expiry of the reasonable
period of time, in the manner reflected in the counterfactual. In this regard, we will first assess the
calculation methodology that China proposes. Should we find that this calcu lation methodology is
not appropriate for estimating the level of nullification or impairment, we will proceed to determine
an alternative calculation methodology.
6.1 Assessment of China's proposed calculation methodology
6.3. China proposes to use the difference-in-difference (DID) tabular approach to estimate the value
of imports from China that would have occurred in 2017 but for the United States' continued
imposition of the anti -dumping orders at issue. 146 As described in section 3 above, China has
excluded Aluminum Extrusions from its calculations and provides calculations concerning the
remaining 24 anti-dumping orders at issue.147
6.1.1 China's proposed DID tabular approach
6.4. Generally, the DID tabular approach es timates the impact of an anti -dumping order by
comparing: (i) the evolution of US imports from China subject to the anti -dumping order, defined
as "the treatment group", between the period prior to the imposition of the order and the year 2017
with (ii) the evolution of US imports from a group of countries not subject to anti -dumping orders
on the product at issue , defined as "the comparison group ", between the period prior to the
imposition of the order and the year 2017. 148 Using the evolution of the US imp orts from the

146 China's methodology paper, paras. 3 and 27-35.
147 As explained above, China bases its request for suspension in the amount of USD 7.043 billion only
on 12 anti-dumping orders covered by the original panel's "as applied" findings of violation, but argues that 12
additional anti-dumping orders covered by the original panel's "as such" findings of violation should be added if
the Arbitrator were to reject or lower China's estimated level of nullification or impairment.
148 China's methodology paper, paras. 31-33 and 74-75.

comparison group as a proxy, the DID tabular approach then estimates the counterfactual value of
US imports from China in 2017, had it not been subject to the anti -dumping order. The impact of
the anti-dumping order on US imports from China i s the difference between the observed, actual
2017 value of US imports from China and the estimated, counterfactual value of US imports from
China in 2017. This amount corresponds to the level of nullification or impairment concerning that
anti-dumping order.149
6.5. As shown in Table 1, to calculate the level of nullification or impairment, the DID tabular
approach requires four data points: (i) the value of US imports from China in the period prior to the
imposition of the anti-dumping order150; (ii) the value of US imports from China in 2017151; (iii) the
value of US imports from the comparison group in the period prior to the imposition of the
anti-dumping order; and (iv) the value of US imports from the comparison group in 2017.
Table 1: General DID tabular approach
 Period prior to
the imposition of
the anti-dumping
order
2017 Difference
US imports from China subject to
anti-dumping order
(treatment group)
𝐶𝐻𝑁𝑝𝑟𝑒𝐴𝐷 𝐶𝐻𝑁𝐴𝐷 𝐶𝐻𝑁𝐴𝐷 − 𝐶𝐻𝑁𝑝𝑟𝑒𝐴𝐷
US imports from a group of
countries not subject to an anti-
dumping order on the same
product (comparison group)
𝐶𝐺𝑝𝑟𝑒𝐴𝐷 𝐶𝐺𝐴𝐷 𝐶𝐺𝐴𝐷 − 𝐶𝐺𝑝𝑟𝑒𝐴𝐷
Difference in difference i.e. level of nullification or impairment −
(𝐶𝐻𝑁𝐴𝐷 − 𝐶𝐻𝑁𝑝𝑟𝑒𝐴𝐷)
(𝐶𝐺𝐴𝐷 − 𝐶𝐺𝑝𝑟𝑒𝐴𝐷)

6.6. In estimating the level of nullification or impairment concerning the anti -dumping orders at
issue, China uses the DID tabular approach to conduct several calculations under different
assumptions, and thus provides several estimates to support its request for authorization to suspend
concessions in the amount of USD 7.043 billion.
6.7. First, China acknowledges that it must apply the DID tabular approach for the anti -dumping
orders at issue in a manner that meets the so-called parallel trends assumption, meaning that absent
the imposition of the anti -dumping orders, the evolution of US imports from China and from the
comparison group would have followed the same trends. 152 Given the importance of the parallel
trends assumption for the DID tabular approach, China proposes to apply the DID tabular approach
for the anti -dumping orders at issue using different comparison groups .153 In addition, China
proposes to use different metrics of analysis.154
6.8. With respect to the comparison group, China uses two definitions: (i) a "non-subject countries"
group comprising exporters of the product from countries not subject to anti -dumping orders; and
(ii) an "all countries" group comprising expor ters from all countries, including China, regardless of
whether they are subject to anti-dumping orders.155 China claims that the "all countries" group has
the advantage of controlling for substitution among exporters from different countries . If imports
from some countries increase because exporters from China or other countries are now shut out of
the market due to the anti-dumping orders, that increase is offset by the decrease in imports from

149 China's methodology paper, para. 36; Difference in Difference Estimates (HS10) for 13 "As Applied"
Cases, (Exhibit CHN-5); Difference in Difference Estimates (HS10) for 12 "As Such" Examples, (Exhibit
CHN-13); and China's Revised Estimates of Nullification or Impairment, (Exhibit CHN-21).
150 Depending on the timing of the imposition of the anti-dumping order, China proposes to use, as the
period prior to the imposition of the order, a period of either three or four years, which might or might not
overlap with the USITC's period of investigation. (China's methodology paper, para. 107). Thus, China uses the
average trade value of these three or four years. (China's methodology paper, para. 75).
151 As explained in section 4 above, China uses calendar year 2017 as the reference period for
determining the level of nullification or impairment caused by the United States' failure to implement the DSB
recommendations and rulings by the expiry of the reasonable period of time.
152 China's methodology paper, paras. 40 and 67-68.
153 China's methodology paper, paras. 70-71.
154 China's methodology paper, paras. 97-98.

China.156 China claims that none of the comparison groups can, ho wever, control for substitution
from exporters to domestic producers caused by the anti-dumping orders, which may depress total
imports from all countries below what otherwise would exist. China is of the view that the DID tabular
approach is therefore inh erently conservative and under estimates the true level of nullification or
impairment.157
6.9. With respect to the metrics of analysis , China proposes to apply the DID tabular approach at
two metrics of analysis, i.e. a level of trade metric and a growth of trade metric.158 Under the level
of trade metric, the calculation is based on the absolute changes in the value of US imports from
China and from the comparison group, as described in paragraph 6.4 above.159 Under the growth of
trade metric, the percentage change in the value of US imports from the comparison group is applied
to the value of US imports from China, and that value is compared with the value of actual imports
from China in 2017. 160 According to Ch ina, one metric is not necessarily better than the other,
because the level of trade and the growth of trade metrics are simply different ways to approach the
issue. While the standard approach is to implement the DID tabular approach using the level of trade
metric, China argues that this approach has limitations when applied to longer periods of time or
broader categories of products, and when the level of trade or capacity of the comparison group
differs significantly from that of China.161 Therefore, China proposes to use the growth of trade
metric as well as the level of trade metric.162
6.10. Accordingly, China applies the DID tabular approach using both the level of trade metric and
the growth of trade metric for both the "non-subject countries" comparison grou p and the "all
countries" comparison group for each anti -dumping order at issue. This approach yields four
calculation results for each order. China then calculates the average of the four calculation results
to estimate the level of nullification or impai rment for each order. China conducts all of these
calculations at Harmonized System (HS) tariff numbers at the ten-digit level.163 All of the calculation
results, and the average thereof, are reproduced in Table 2 below.
6.11. Second, to demonstrate that its estim ated level of nullification or impairment is accurate,
China conducts robustness checks. More particularly, China applies the DID tabular approach using
the growth of trade metric for a broader category of products, by using more aggregated data at
HS-6, HS-4, and HS-2 levels. China also produces a minimum estimate for each anti-dumping order
by picking the lowest of the four calculation results described in the preceding paragraph. China uses
the robustness checks to demonstrate that the estimated level of nullification or impairment does
not change significantly when the definition of the product changes, or when using the minimum
estimate.164 China also provide s alternative estimates that take into account the effect of
countervailing duties imposed on some of the products at issue .165 All of the calculation results
yielded under China's robustness checks are reproduced in Table 2 below.

159 China's methodology paper, paras. 96-97.
160 China notes that the growth of trade metric is the same as applying the DID tabular approach using
the logarithmic value of trade. (China's methodology paper, fn 46).
163 China's methodology paper, paras. 6 and 117.
164 China's methodology paper, paras. 138-139.
165 China's methodology paper, paras. 124-136.

Table 2: Results yielded under China's proposed DID tabular approach

Calculation results
(million USD)
Robustness checks
(million USD)
HS-10 HS-10 HS-6 HS-4 HS-2
Non-Subj All Non-Subj and All Non-Subj and All All
Level-DID Growth-
DID Level-DID Growth-
DID
Average
level-DID
Average
growth-
DID
Average
of level-
and
growth-
DID
Minimum
of level-
and
growth-
DID
CVD
adjusted
average
of level-
and
growth-
DID
Growth-
DID
Growth -
DID
Growth -
DID
 Including Aluminum Extrusions Including Aluminum Extrusions
13 "as applied"
anti-dumping orders 33,025 21,843 54,445 12,329 43,734 17,087 30,410 12,092 17,226 6,013 5,967 6,631
12 "as such"
anti-dumping orders 9,242 9,221 5,095 4,403 7,168 6,812 6,990 3,449 5,003 4,447 4,514 4,552
Total 42,267 31,064 59,540 16,732 50,902 23,899 37,400 15,541 22,229 10,460 10,481 11,183
 Excluding Aluminum Extrusions Excluding Aluminum Extrusions
12 "as applied"
anti-dumping orders 10,421 8,361 9,264 4,831 9,842 6,597 8,219 4,594 7,462 6,013 5,967 6,631
12 "as such"
anti-dumping orders 9,242 9,221 5,095 4,403 7,168 6,812 6,990 3,449 5,003 4,447 4,514 4,552
Total 19,663 17,582 14,359 9,234 17,010 13,409 15,209 8,043 12,465 10,460 10,481 11,183
Sources: China's Revised Estimates of Nullification or Impairment, (Exhibit CHN-21); and China's response to Arbitrator question No. 28, para. 163.
Notes: "Non-subj" refers to the "non-subject countries" comparison group, while "All" refers to the "all countries" comparison group. "Level-DID" refers to the DID
tabular approach based on a level of trade metric, while "Growth-DID" refers to the DID tabular approach based on a growth of trade metric. The first part of
the table reports China's calculation results including Aluminum Extrusions, the second part reports China's calculation results excluding Aluminum Extrusions.

6.12. Based on its proposed DID tabular approach, China estimates that t he total level of
nullification or impairment is equal to USD 8.219 billion for the 12 of the anti-dumping orders covered
by the "as applied" findings of violation and USD 6.990 billion for the 12 anti-dumping orders covered
by the "as such" findings of violation .166 As explained in section 3 above, China requests
authorization to suspend concessions in the amount of USD 7.043 billion, and bases its request only
on 12 of the anti-dumping orders covered by the "as applied" findings of violation.167 China argues
that, in case the Arbitrator lowers the amount of nullification or impairment for the "as applied"
findings of violations, the Arbitrator should "add to the lowered estimate" the level of nullification or
impairment concerning the "as such" findings of violation.168
6.1.2 China's proposed adjustments to the DID tabular approach
6.13. As explained above, China's proposed DID tabular approach estimates the value of US imports
from China that would have occurred in 2017, but for the United States' continued imposition of the
anti-dumping orders at issue. In other words, China's proposed calculation methodology
presupposes the use of China's proposed counterfactual, that is the withdrawal of the entirety of the
anti-dumping orders at issue. We have, in section 5 above, rejected China's proposed counterfactual
and determined an alternative counterfactual, namely, the reduction of the anti-dumping duties that
were calculated using the WTO -inconsistent WA-T methodology with zeroing and the Single Rate
Presumption.
6.14. In response to a question from the Arbitrator, China argues that its proposed calculation
methodology can be used even if the Arbitrator were to choose a counterfactual other than the one
that China proposes. In this context, China proposes two types of adjustments.
6.15. First, China propos es an adjustment to account for a counterfactual where only the
anti-dumping duties imposed on exporters within the PRC -wide entity are withdrawn, whereas all
other anti-dumping duties at issue remain. In this regard, China proposes to adjust downward the
estimated level of nullification or impairment in proportion to the share of the PRC-wide entity in US
imports from China during the original period of investigation. On this basis, China estimates a total
adjusted level of nullification or impairment of USD 5.6 billion for all 24 anti-dumping orders.169
6.16. Second, China proposes adjustments to account for a counterfactual, under which the
anti-dumping duties are only modified rather than withdrawn. In this regard, China proposes to
apply a 10% reduction to its estimated level of nullification or impairment for anti -dumping orders
where the counterfactual duty rate is lower than 10%. For the anti -dumping orders where the
counterfactual duty rate is higher than 10%, China proposes to adjust downward the estimated level
of nullification or impairment in proportion to the counterfactual duty rate. On this basis , China
estimates a total adjusted level of nullification or impairment of USD 12.1 billion for all 24
anti-dumping orders.170
6.1.3 Assessment by the Arbitrator
6.17. We recall that the DID tabular approach compares the evolution of US imports from China
with the evolution of US imports from the comparison groups. It uses the latter to estimate a
counterfactual value of US imports from China, had it not been for the continued imposition of the
anti-dumping orders at issue, and to estimate the level of nullification or impairment. More
particularly, the level of nullification or impairment consists of the difference between the actual
value of US imports from China in 2017 and the estimated, counterfactual value of US imports from
China in 2017. Therefore, the appropriateness of the DID tabular approach hinges on the choice of
the comparison group s. Inherently, the DID tabular approach can only be considered a v alid
calculation methodology if the evolution of US imports from China would have been similar to the

166 China's written submission, para. 105. This figure excludes Aluminum Extrusions.
167 China's methodology paper, paras. 166-168.
169 China's opening statement at meeting of the Arbitrator, para. 49; and response to Arbitrator
question No. 77, paras. 103-107; and China's Adjusted Estimates of Nullification or Impairment To Take Into
Account Only PRC-Wide Entity Exports, (Exhibit CHN-49 (BCI)).
170 China's response to Arbitrator question No. 76, paras. 92-98; and China's Adjusted Estimates of
Nullification or Impairment To Take Into Account Changing Anti-Dumping Duty Rates, (Exhibit CHN-48).

evolution of US imports from the countries in the comparison groups, in the absence of the anti -
dumping orders.
6.18. As explained above, China uses two differe nt comparison groups, namely a "non-subject
countries" group comprising exporters of the product from countries not subject to anti -dumping
orders; and an "all countries" group comprising exporters from all countries, including China,
regardless of whether they are subject to anti -dumping order s.171 China estimates the level of
nullification or impairment using an average of the calculations conducted for each comparison
group. The United States is of the view that the comparison groups used by China fail to meet three
key assumptions, namely (i) the parallel trends assumption; (ii) the stability assumption, and
(iii) the uniformity assumption.172 We now turn to examine whether these three assumptions are
met.
6.19. The parallel trends assumption requires that the trends in both US imports from China
and US imports from the comparison groups would be the same in the absence of the anti-dumping
orders.173 In the United States' view, neither of the two comparison groups chosen by China meets
this assumption.174 China argues that it cannot perform a statistical analysis demonstrating that US
imports from China and from the comparison groups satisfy the parallel trends assumption because
it does not have the necessary publicly available data , due to regular changes in the US H TS
system.175 In any event, China contends that a statistical analysis is not necessary to conclude what
is common sense , namely, that the evolution of imports from other suppliers in the market is
informative of what the evolution of imports from China would have been but for the continued
imposition of the anti-dumping orders at issue.176
6.20. Both parties agree on the relevance of the parallel trends assumption.177 We too consider that
this assumption is the most critical assumption to ensure the validity of China's DID tabular approach
and therefore its estimated level of nullification or impairment. While China asserts that it made a
considerable effort to demonstrate that the parallel trends assumption holds for its co mparison
groups178, China does not provide any evidence to prove that the parallel trends assumption holds.
Instead, China provides calculations using both the level of trade metric and the growth of trade
metric for its two chosen comparison groups and uses the avera ge of these calculations, arguing
that this renders its estimated level of nullification or impairment accurate. Further, China points out
that it has conducted robustness checks by applying its DID tabular approach to a broader category
of products using data at higher aggregated HS levels; by applying its DID tabular approach to
calculate minimum estimates; and by applying its DID tabular approach to calculate estimates which
take into account the effect of countervailing duties imposed on some of the products at issue.179 In
China's view, the results obtained from its robustness check s are similar to its estimated level of
nullification or impairment, thus confirming the reasonableness of the latter.180 According to China,
its flexible approach provides the Arbitrator with a set of estimates from which it can "mix and
match" as it finds appropriate.181
6.21. The United States argues that China's use of an average of estimates does not provide an
accurate level of nullification or impairment, since all of these estimates are calculated using China's
flawed DID tabular approach.182 Similarly, the United States argues that China did not provide valid
robustness checks because it should not have used its own DID tabular approach, but rather a
variety of methods to estimate the level of nullification or impairment under different but plausible

172 United States' written submission, paras. 114 and 129.
174 Further, the United States argues that the DID tabular approach requires a definition of the
treatment and comparison groups that closely approximates conditions in which the treatment, i.e. the anti-
dumping duties, can be considered randomly assigned relative to a comparison group that faces identical
conditions except for the treatment. The United States is of the view that it is incorrect to designate the "non-
subject countries" group as a comparison group because the treatment cannot be thought of as being applied
randomly. (United States' written submission, para. 118).
175 China's response to Arbitrator question No. 19(c), para. 93.
176 China's response to Arbitrator question No. 19(c), para. 92.
177 China's methodology paper, para. 40; and United States' written submission, paras. 129-130.
179 China's written submission, paras. 106-108.
180 China's response to Arbitrator question No. 21, paras. 112-121.
181 China's response to Arbitrator question No. 21, para. 113.

assumptions.183 Furthermore, the United States asserts that many of the results yielded under
China's robustness checks are not similar to China's estimated level of nullification or impairment,
and that China does not follow any standard statistical procedure to demonstrate that the differences
between the results yielded under the robustness checks and the estimated level of nullification or
impairment are approximately zero.184
6.22. We are not convinced by China's approach. The use of an average of different estimates based
on different comparison groups does not, in and of itself, demonstrate that these comparison groups
meet the parallel trends assumption. Nor does the use of an average mean that the estimated level
of nullification or impairment is accurate, especially wh en one or more comparison groups do not
meet the parallel trends assumption. Similarly, since China's robustness checks are also conducted
based on the same comparison groups, we do not consider that these robustness checks serve to
demonstrate that these comparison groups meet the parallel trends assumption. We further note
that China claims that its estimated level of nullification or impairment of USD 7.043 billion is robust
as it is within the same range as the results yielded under the robustness check s.185 However, as
demonstrated in Table 2, the robustness checks conducted for the anti -dumping orders underlying
China's estimate yield results ranging from USD 4 .6 billion to USD 7 .5 billion. C hina has not
demonstrated that the difference s between the estimated level of nullification or impairment and
the results yielded under the robustness checks are insignificant. We therefore consider that these
results vary significantly, which undermines China's claim of robustness.
6.23. Although there is no formal statistical test to assess the validity of the parallel trends
assumption, we note suggestions from literature to use , as a preliminary exercise, a graphical
comparison of the trends in US imports from China and the trends in US imports from the comparison
groups before the imposition of the anti -dumping orders.186 This would provide an indication of
whether US imports from all groups have followed similar trends in the past. China does not provide
any graphical analysis because of "serious challenge [s] due to regular changes in the US H TS
system".187 Yet, th e United States provides two illustrative graphical comparison examples for
Steel Cylinders and Coated Paper, suggesting that the parallel trends assumption does not hold for
the level of trade metrics nor the growth of trade metrics.188 We are therefore of the view that the
comparison groups that China proposes do not meet the parallel trends assumption.
6.24. The stability assumption requires that (i) the products covered by US imports from China
and from the comparison group s must remain the same over time; and (ii) US imports from the
comparison groups cannot be affected by spillover effects caused by the anti -dumping orders.189
According to the United States, this assumption is not met because the product scope of some of
the anti-dumping orders has changed between the imposition of the order and 2017, due to changes
in the underlying set of H TS codes.190 The United States further claims that China's approach
invalidates the stability assumption because the anti-dumping orders have had spillover effects on
the comparison groups by increasing US imports from countries not subject to the orders .191 China
argues that the stability assumption is not relevant to its DID tabular approach192, and submits that

183 United States' written submission, para. 151. The United States also argues that China's robustness
checks are not valid because there is no evidence that US imports of a given category of products at HS-10
level should be expected to follow the same trends as US imports of a broader category of products at HS-6,
HS-4, or HS-2 levels. (United States written submission, paras. 142-148).
185 China's methodology paper, paras. 137-144.
186 See Presentation of Difference-in-Difference Estimation, Columbia University, (Exhibit USA-20); and
J. Angrist, J. David, and J. Pischke, Mostly Harmless Econometrics: An Empiricist's Companion, (Princeton
University Press, 2009), (Exhibit USA-23).
187 China's response to Arbitrator question No. 19(c), para. 93.
188 See United States' written submission, figures 2 and 3; and Annex D-1.
189 United States' written submission, para. 133; and D. Rubin, "Assignment to Treatment Group on the
Basis of a Covariate" (1977), Vol. 2, No. 1, Journal of Educational Statistics, pp. 1-26.
191 United States' written submission, para. 134. The United States claims that violations of the parallel
trends and stability assumptions in China's DID tabular approach manifest, in part, as omitted variables bias in
the value of estimates of nullification or impairment. (United States' response to Arbitrator question No. 17,
para. 55).
192 China's written submission, paras. 119-120.

it made a significant effort to produce a series of estimates of the level of nullification or impairment
under different assumptions.193
6.25. We note that, contrary to China's assertion, the stability assumption is referenced in academic
literature as a necessary requirement for using the DID tabular approach. 194 We also consider this
assumption to be relevant. As a mathematical matter, the DID tabular approach does not allow a
valid comparison between the evolution of US imports from China and the evolution of US imports
from the comparison groups if the scope of the imported products changes over time. Furthermore,
if the evolution of US imports from the comparison groups is affected by spillover effects from the
anti-dumping orders imposed on US imports from China, then the evolution of US imports from the
comparison groups cannot reasonably be used as a proxy to estimate how US imports from China
would have developed, had it not been for the continued imposition of the anti-dumping orders.
6.26. We question whether the stability assumption holds under China's DID tabular approach. As
both parties point out, the product scope of some anti -dumping orders in terms of HTS codes has
changed between the initial period and 2017. More importantly, we cannot rule out that US imports
from countries not subject to anti -dumping orders, which form part of both comparison groups
proposed by China, are affected by the anti-dumping orders imposed on US imports from China and
other countries. China's failure to take i nto account such indirect impact would taint the validity of
the comparison groups and thus yield biased estimates of nullification or impairment.
6.27. The uniformity assumption requires that the level of the anti-dumping duties and lack
thereof be the same for US imports from China and from the comparison group, respectively .195 In
other words, under the DID tabular approach proposed by China, all exporters within the treatment
group must be subject to the same level of anti -dumping duties, and all exporters with in the
comparison groups must be subject to no anti-dumping duties at all. The United States argues that
this assumption does not hold under China's approach because the levels of the anti-dumping duties
vary for different exporters.196 The United States is further of the view that the "all countries" group
is an invalid comparison group because it includes US imports from China and from other countries
subject to anti-dumping orders.197 China argues that the uniformity assumption is not relevant to its
DID tabular approach198, and submits that it made a significant effort to produce a series of estimates
of the level of nullification or impairment under different assumptions.199
6.28. We note that, contrary to China's assertion, the uniformity assumption is relevant. The DID
tabular approach proposed by China only considers the case of a single level of anti-dumping duties
or lack thereof. In other words, it cannot take into account the effect of different levels of anti -
dumping duties.200
6.29. In our view, t he uniformity assumption does not hold under China's DID tabular approach
because, for all of the anti-dumping orders at issue, different dut y rates are applied to US imports
from different Chinese exporters. Therefore, not all US imports from China are subject to the same
level of anti-dumping duties. Moreover, the uniformity assumption also requires that all exporters in
the comparison groups be uniformly not subject to anti-dumping duties at all. As explained above,
the "all countries" comparison group includes US imports from China and other countries subject to
anti-dumping orders. This contradicts the requirement that a valid comparison group must not be

194 M. Lechner, "The estimation of causal effects by difference-in-difference methods" (2011), Vol. 4,
No. 3, Foundations and Trends in Econometrics, pp. 165-224.
198 China's written submission, paras. 119-120.
200 The DID tabular approach can accommodate different levels of anti-dumping duties provided that it
is demonstrated that the average outcomes for all exporters within the treatment group would have followed
parallel trends in the absence of the treatment. (See A. Abadie, "Semiparametric Difference-in-Differences
Estimators" (2005), Vol. 72, No. 1, The Review of Economic Studies, pp. 1-19; and B. Callaway and P.
Sant'Anna, "Difference-in-differences with multiple time periods", Working Paper (2019)). As discussed above,
we are not convinced that the parallel trends assumption holds under China's DID tabular approach.

affected by the treatment, i.e. the anti-dumping orders201, and we therefore do not consider the "all
countries" comparison group valid.
6.30. As described in the preceding paragraphs, we do not consider that the parallel trends
assumption, the stability assumption, or the uniformity assumption hold for the comparison groups
chosen by China. For these reasons, we are not convinced that the evolution of US imports from the
chosen comparison groups would have been similar to the evolution of US imports from China, in
the absence of the anti -dumping orders. Since the DID tabular approach estimates the level of
nullification or impairment by estimating the evolution of US imports from China using the evolution
of US imports from the comparison groups as a proxy, China's choice of comparison groups renders
its use of the DID tabular approach unsuitable.
6.31. The United States has advanced additional arguments against China's proposed DID tabular
approach. First, the United States argues that China should not have used a DID tabular approach
but rather a DID regression approach, which can control not just for the anti -dumping orders but
also for other factors that impact US imports from China differently than US imports from the
comparison groups.202 Second, the United States argues that China's use of the growth of trade
metric in the context of its DID tabular approach is inappropriate, and that the growth of trade metric
and the level of trade metric are mutually exclusive because the parallel trends assumption can only
hold for one metric for any given product, not both. This means that either the estimate based on
the growth of trade metric or the estimate based on the level of trade metric must be biased, in turn
rendering the average of the two biased. 203 Third, the United States argues that the DID tabular
approach can only estimate the level of nullification or impairment based on a counterfactual under
which the entirety of the anti -dumping orders are withdrawn. According to the United States, the
adjustments proposed by China are seriously flawed, not consistent with China's own methodology,
and not based on economic theory.204
6.32. We note that, like the DID tabular approach itself, the United States' additional arguments
hinge upon the validity of the parallel trends assumption, the stability assumption, and the uniformity
assumption. For instance, the use of a DID regression approach rather than a DID tabular approach
or the use of either a growth of trade metric or a level of trade metric both require that these three
assumptions hold. We have already determined that none of these three assumptions hold for
China's DID tabular approach, and found, on this basis, that China's proposed calculation
methodology is not appropriate. In light of this, we do not consider it necessary or useful to address
the United States' additional arguments concerning that methodology.
6.33. For the reasons set out above, we conclude that China's proposed DID tabular approach is
not an appropriate calculation methodology for estimating the level of nullification or impairment. In
order to fulfil our mandate, we therefore proceed to determine an alternative calculation
methodology.
6.2 Determination of an alternative calculation methodology
6.34. Having found that China's proposed calculation methodology is not an appropriate one, we
proceed to determine an alternative calculation methodology for estimating the level of nullification
or impairment. In this regard, we find it useful to begin with an assessment of the calculation
methodologies the United States has proposed and consider whether those can provide the basis for
our estimation.
6.2.1 The United States' proposed calculation methodologies
6.35. Unlike China, which proposes a single calculation methodology to estimate the level of
nullification or impairment for all anti -dumping orders at issue, the United States proposes to use
two different calculation method ologies to estimate the level of nullification or impairment:

201 See M. Lechner, "The estimation of causal effects by difference-in-difference methods" (2011),
Vol. 4, No. 3, Foundations and Trends in Econometrics, pp. 165-224.
202 United States' written submission, paras. 120-121 and 148; and response to Arbitrator question
No. 17, paras. 66-67.
203 United States' written submission, para. 127; and response to Arbitrator question No. 17,
paras. 79-83.
204 United States' comments on China's response to Arbitrator No. 76, paras. 78-87.

(i) a formula-based approach on market shares (formula -based approach); and (ii) an Armington
imperfect substitutes partial equilibrium model (Armington model).
6.36. The United States determines whether to apply the formula-based approach or the Armington
model on the basis of a threshold calculation: If the share of the value of US imports from exporters
assigned WTO-inconsistent anti-dumping duties over the total value of US imports from China in
2017 is smaller than 1%, the United States uses the formula-based approach, otherwise it uses the
Armington model.205
6.2.1.1 The formula-based approach
6.37. As explained above, the United States proposes a formula -based approach if the share of
US imports from exporters a ssigned WTO-inconsistent anti-dumping duties over the total value of
US imports from China in 2017 is smaller than 1%.206
6.38. The formula-based approach calculates the share of exporters subject to WTO -inconsistent
anti-dumping duties in the total value of US im ports from China during the period of investigation,
and applies that share to the total value of US imports of that product from China in 2017, to
determine a counterfactual value of US imports from those exporters in 2017. 207 It then subtracts
the actual 2017 value of imports from the counterfactual 2017 value of imports to estimate the level
of nullification or impairment.208
6.39. According to the United States, the formula -based approach overestimates the level of
nullification or impairment because it assumes t hat exporters subject to WTO -inconsistent
anti-dumping duties would retain the same share of the total value of US imports from China in 2017
as in the period of investigation even though other Chinese exporters assigned a lower duty rate
would be more competitive and would therefore capture a higher market share.209
6.2.1.2 The Armington model
6.40. The Armington model is a partial equilibrium economic model that analyses a single market
of a given product, ignoring linkages with other markets because those linkages are presumed to be
negligible. The Armington model that the United States proposes assumes that, in the US market,
the product at issue is differentiated by source countries and that consumers view products from
different countries as imperfect substitutes. Imperfect substitutes are products with fairly similar but
not identical attributes, which consumers do not necessarily substitute with one another when their
relative prices change.210
6.41. The version of the Armington model proposed by the United States contains four different
varieties of the product at issue originating in four different sou rces: (i) variety produced in the
United States (𝑢𝑠); (ii) variety imported from the Chinese exporters subject to WTO -inconsistent
anti-dumping duties (𝑝𝑟𝑐); (iii) variety imported from the remaining Chinese exporters ( 𝑟𝑜𝑖𝑐); and
(iv) variety imported from exporters from the rest of the world ( 𝑟𝑜𝑤).211 In more technical terms,
the Armington model is defined by a set of equations representing the supply and the demand of
each of the four varieties (equations 1 to 4) as well as an aggregate product demand (equation 5)
and price index (equation 6).212

207 United States' written submission, paras. 10 and 88.
208 United States' response to Arbitrator question No. 40, para. 155.
210 Paul S. Armington, A Theory of Demand for Products Distinguished by Place of Production, Vol. 1,
No.1, International Monetary Fund (March 1969), (Exhibit USA-68).

US domestic production market
equilibrium: 𝑎𝑢𝑠 (𝑝𝑢𝑠)𝜀𝑢𝑠 = 𝑄 𝑏𝑢𝑠
𝜎 (𝑝𝑢𝑠
𝑃 )
−𝜎
 (1)
US imports from Chinese
exporters subject to WTO-
inconsistent anti-dumping duties
market equilibrium:
 𝑎𝑝𝑟𝑐 (𝑝𝑝𝑟𝑐
𝑡𝑝𝑟𝑐

𝜀𝑠
= 𝑄 𝑏𝑝𝑟𝑐
𝜎 (𝑝𝑝𝑟𝑐
𝑃 )
−𝜎
 (2)
US imports from the rest of China
market equilibrium: 𝑎𝑟𝑜𝑐 (𝑝𝑟𝑜𝑐)𝜀𝑟𝑜𝑐 = 𝑄 𝑏𝑟𝑜𝑐
𝜎 (𝑝𝑟𝑜𝑐
𝑃 )
−𝜎
 (3)
US imports from the rest of the
world market equilibrium: 𝑎𝑟𝑜𝑤 (𝑝𝑟𝑜𝑤)𝜀𝑟𝑜𝑤 = 𝑄 𝑏𝑟𝑜𝑤
𝜎 (𝑝𝑟𝑜𝑤
𝑃 )
−𝜎
 (4)
US aggregate market equilibrium: 𝑄 = 𝑌0𝑃θ (5)
US price index 𝑃 = (𝑏𝑢𝑠
𝜎𝑝𝑢𝑠1−𝜎 + 𝑏𝑝𝑟𝑐
𝜎𝑝𝑝𝑟𝑐1−𝜎 + 𝑏𝑟𝑜𝑐
𝜎𝑝𝑟𝑜𝑐1−𝜎 + 𝑏𝑟𝑜𝑤
𝜎 𝑝𝑟𝑜𝑤1−𝜎)
1
1−𝜎 (6)
6.42. The market equilibrium determines the prices (𝑝𝑢𝑠, 𝑝𝑝𝑟𝑐, 𝑝𝑟𝑜𝑐 and 𝑝𝑟𝑜𝑤) for which the quantities
demanded are simultaneously equal to the quantities supplied in each of the four variety markets,
subject to the constraint that the US aggregate industry output quantity (𝑄) is equal to the US
aggregate demand evaluated at the price index of the product (𝑃) and for a given initial equilibrium
level of aggregate industry expenditure (𝑌0). The market equilibrium can be obtained by solving the
set of equations either through a numerical iterative solution or a linear approximation. The
United States solves the Armington model through numerical iterations.213
6.43. The United States proposes to use the Armington model to simulate the impact of reducing
the duty rates applied to US imports from Chinese exporters subject to WTO -inconsistent
anti-dumping duties (𝑡𝑝𝑟𝑐) on the prices and quantities of the US domestic production and US imports
from these exporters, from the remaining Chinese exporters and from the rest of the world. In other
words, t he simulated value of US imports represents the value of US imports but for the
WTO-inconsistent anti -dumping duties . The corresponding level of nullification or impairment is
obtained by calculating the difference between the actual value of US imports fr om China in 2017
and the counterfactual value of US imports from China. The United States calculates the
counterfactual value of US imports from China as the sum of the simulated value of US imports from
exporters subject to WTO-inconsistent anti-dumping duties and the simulated value of US imports
from the remaining Chinese exporters following the reduction of the anti-dumping duties from the
actual duty rates to the counterfactual duty rates.214
6.44. In order to estimate the level of nullification or impairment for a given anti -dumping order,
the Armington model requires 13 parameter inputs: the 2017 total value of the US market (𝑌0), the
2017 market shares of the four varieties of the product originating in four different sources 215
(𝑚𝑢𝑠, 𝑚𝑝𝑟𝑐, 𝑚𝑟𝑜𝑐 and 𝑚𝑟𝑜𝑤), the price elasticity of total demand (total demand elasticity) ( θ), the
elasticity of substitution (σ), the supply elasticities of the four varieties (𝜀𝑢𝑠, 𝜀𝑝𝑟𝑐, 𝜀𝑟𝑜𝑐 and 𝜀𝑟𝑜𝑤), and
the actual and counterfactual duty rates. These 13 parameter inputs determine the calibrated values
of the remaining parameters of the model, namely, the supply and demand shifting factors
(𝑎𝑢𝑠, 𝑎𝑝𝑟𝑐, 𝑎𝑟𝑜𝑐, 𝑎𝑟𝑜𝑤, 𝑏𝑢𝑠, 𝑏𝑝𝑟𝑐, 𝑏𝑟𝑜𝑐 and 𝑏𝑟𝑜𝑤).
6.45. The total demand elasticity measures the responsiveness of the quantity demanded of a
product to a change in its price. It is typically defined as the percentage change in the quantity
demanded in response to a 1% change in price.
6.46. The elasticity of substitution, also known as the rate of substitution or Armington elasticity,
measures how easily US consumers switch from one variety to the other when prices change. Under
the assumptions of the Armington model, consumers substitute between each variety at a constant
rate. This elasticity of substitution ranges between 0 and infinity. A 0 elasticity of substitution means

213 Code and Text Version of the United States' Proposed Armington Model, (Exhibit USA-19).
215 The market share for each variety of the product is defined as its share of total US consumption of
the product, namely, 𝑚𝑢𝑠 =
𝑝𝑢𝑠×𝑞𝑢𝑠
𝑃×𝑄 ; 𝑚𝑝𝑟𝑐 =
𝑝𝑝𝑟𝑐×𝑞𝑝𝑟𝑐
𝑃×𝑄 ; 𝑚𝑟𝑜𝑐 =
𝑝𝑟𝑜𝑐×𝑞𝑟𝑜𝑐
𝑃×𝑄 ; 𝑚𝑟𝑜𝑤 =
𝑝𝑟𝑜𝑤×𝑞𝑟𝑜𝑤
𝑃×𝑄 .

that there is no substitutability at all between varieties, while an infinite elasticity of substitution
means that the varieties are considered perfect substitutes by consumers.
6.47. The supply elasticity measures the responsiveness of the quantity supplied of a product to a
change in its price. This supply elasticity ranges between 0 and infinity. A 0 supply elasticity means
that firms have constrained production capacity and cannot increase or decrease the supply of the
product in response to price changes, while an infinite elasticity means that firms can automatically
increase or decrease the supply of the product in response to price changes.
6.2.2 Assessment by the Arbitrator
6.48. We have described above the two different calculation methodologies that the United States
proposes to estimate the level of nullification or impairment. Below, we first assess the United States'
approach for choosing, for each anti -dumping order at issue, which of the two calculation
methodologies to apply. We then assess both calculation methodologies, beginning with the formula-
based approach and then turning to the Armington model.
6.2.2.1 Assessment of the United States' approach for choosing between the two
calculation methodologies
6.49. In deciding which of the two methodologies to use for estimating the level of nullification or
impairment, the United States uses a threshold of 1% for the share of the value of US imports from
exporters assigned WTO-inconsistent anti-dumping duties over the total value of US imports from
China in 2017. If this share is greater than 1% for a n anti-dumping order, the United States uses
the Armington model to estimate the level of the nullification or impairment concerning the order.
Conversely, if this share is less than 1%, the United States uses the formula -based approach to
estimate the level of nullification or impairment concerning the order.216
6.50. The United States uses the 1% threshold because it contends that the Armington model
cannot be used to produce reliable estimates where the share of US imports from exporters assigned
WTO-inconsistent anti-dumping duties is "minimal" 217 or "close to zero". 218 In the United States'
view, 1% is a reasonable threshold above which import values are sufficiently large to reveal
underlying relative competitiveness given the prevailing conditions in the market, and thus to permit
the use of the Armington model .219 China, on the other hand, contends that t he 1% threshold is
arbitrary and that the United States has provided no academic support for using this threshold. 220
According to China, there are a number of anti-dumping orders where the share of US imports from
exporters assigned WTO-inconsistent anti-dumping duties is so small, albeit above the 1% threshold,
that it renders the use of the Armington model inapt.221
6.51. As further discussed in section 6.2.2.3.2 below, both parties agree that the Armington model
is not an appropriate calculation methodology for estimating the level of nullification or impairment
concerning anti -dumping orders where the 2017 market share of exporters assigned
WTO-inconsistent anti-dumping duties is very small, although they disagree on the specific threshold
to be used. This problem, often referred to as the "small shares" problem, is also recognized in the
academic literature.222 More particularly, if the exporters subject to WTO-inconsistent anti-dumping
duties have a very small market share in the reference period, the Armington model will simulate a
very small trade impact of reducing the duty rates, even if that reduction is very large. This is
because increases or decreases in market shares are expressed relative to initial market shares in

216 United States' written submission, paras. 44-45 and 78.
219 United States' response to Arbitrator question No. 38(b), para. 143.
221 China's written submission, para. 165 (referring to Iron Pipe Fittings, Bags, Steel Nails, and Steel
Cylinders).
222 The "small shares" problem is sometimes referred to as the "small shares stay small" problem. (See
M. Kuiper and F. van Tongeren, "Using gravity to move Armington" (2006), Paper prepared for the Ninth
Annual Conference on Global Economic Analysis in Addis Ababa, Ethiopia. See also G. Philippidis, H. Resano-
Ezcaray, A. I. Sanjuán-López. "Shifting Armington Trade Preferences: A re-examination of the Mercosur-EU
negotiations" (2014), No. 40. Economic Modelling, pp. 21-32).

the Armington mod el.223 In the case of a 0% market share in the reference period for exporters
subject to WTO-inconsistent anti-dumping duties, the Armington model will always generate a 0%
simulated market share for those exporters, no matter how large the reduction in the duty rates is.
However, we see no basis in academic literature for using a 1% threshold, and the United States
has provided no such basis in order to justify its approach.224
6.52. We further note that, for the purpose of determining whether the 1% threshold is me t, the
United States uses the share of the value of US imports from exporters subject to WTO-inconsistent
anti-dumping duties over the total value of US imports from China in 2017 .225 For the purpose of
estimating the level of nullification or impairment, however, the Armington model uses the share of
the value of US imports from exporters assigned WTO -inconsistent anti-dumping duties over the
total value of the US market in 2017 .226 It is unclear why the United States does not define its
threshold with the same denominator used in the Armington model. Since the total value of US
imports from China is always smaller than the total value of the US market, using the former as the
denominator necessarily increases the shar e and thus renders it more likely that the threshold for
using the Armington model is met.
6.53. While we, in principle, see no issue with using different calculation methodologies for the
different anti-dumping orders, the approach for choosing between the two must not be arbitrary,
considering the features of these methodologies. Given that the United States applies an arbitrary
threshold and calculates this threshold using inputs, which are not consistent with those used in the
Armington model and which make it more likely that the threshold for using the Armington model is
met, we consider that the United States follows an arbitrary approach in choosing between the
Armington model and the formula-based approach.
6.54. For these reasons, we decline to use the United States' approach for choosing between the
Armington model and the formula -based approach. We turn to assess each of the two calculation
methodologies to determine an appropriate calculation methodology for estimating the level of
nullification or impairment concerning all of the anti-dumping orders at issue.
6.2.2.2 Assessment of the formula-based approach
6.55. As explained above, the formula-based approach applies the historic share of US imports from
Chinese exporters subject to WTO-inconsistent anti-dumping duties, from prior to their imposition,
to the total value of US imports from China in 2017, in order to determine a counterfactual value of
US imports from those exporters in 2017 and to estimate the level of nullification or impairment.227
6.56. China argues that the for mula-based approach incorrectly assumes that any increase in
imports from Chinese exporters subject to WTO -inconsistent anti -dumping duties under the
counterfactual scenario would occur at the expense of other Chinese exporters. 228 Further, China
argues that this approach yields downward biased results because it uses historical shares of
exporters subject to WTO -inconsistent anti-dumping duties, which China considers demonstrably
wrong229, and applies these historical shares to the actual 2017 total value of US imports from China,
which China considers to be depressed due to the imposition of the anti -dumping duties.230 The
United States, on the other hand, argues that the formula-based approach does not "take trade

223 In particular, the simulated market shares in the Armington model depend, among others, on the
demand shifting factors, whose calibrated values depend on the initial market shares. All other things being
equal, small initial market shares thus yield small demand shifting factors, which in turn yield small simulated
market shares.
224 The United States argues that the 1% threshold is a reasonable determination of the point at which
observed import values are sufficiently greater than 0 to reveal underlying relative competitiveness given the
prevailing conditions in the market. However, despite being asked for economic evidence supporting the use of
a 1% threshold, the United States has not provided references to academic literature or other evidence in
support of its argument. (United States' response to Arbitrator question No. 28(b), paras. 143-144).
226 See R. Hallren and D. Riker, An Introduction to Partial Equilibrium Modeling of Trade Policy,
Economics Working Paper Series (Working Paper 2017-07-B), USITC (July 2017), (Exhibit USA-15).
227 United States' written submission, paras. 10 and 88; and response to Arbitrator question No. 40,
para. 155.
229 China's written submission, paras. 146-148.

volume or value away " from other Chinese export ers.231 The United States considers that the
historical share of exporters subject to WTO -inconsistent anti -dumping duties is an appropriate
reference point232, and that it is reasonable to scale the actual 2017 total value of US imports from
China.233
6.57. By using the actual 2017 value of total US imports from China, the formula -based approach
assumes that the total value of US imports from China would remain the same, had the United States
complied with the DSB recommendations and rulings by the expiry of the reasonable period of time.
In other words, where the value of US imports from exporters subject to WTO -inconsistent
anti-dumping duties increases in the counterfactual scenario, the formula-based approach assumes
that this increase is offset by a corresponding decrease in the value of US imports from other Chinese
exporters. The United States provides no evidence suggesting that this assumption is reasonable.
The United States simply asserts that the formula-based approach does not "take trade volume or
value away" from Chinese exporters that were not assigned WTO-inconsistent anti-dumping duties,
but rather uses the historical import shares for all Chinese exporters.234 The basis for this assertion
appears to relate to the United States' proposed counterfactual, n amely, the reduction of the
WTO-inconsistent anti-dumping duties to the level of the anti-dumping duties assigned to "the rest
of China".235 We recall that we have rejected the United States' proposed counterfactual with respect
to several of the WTO -inconsistent anti-dumping duties at issue. 236 Further, in our view, it is not
reasonable to assume that the value of total US imports from China would remain at the actual 2017
value, and that any increase in US imports from Chinese exporters subject to WTO -inconsistent
anti-dumping duties would be offset by a corresponding decrease in US imports from other Chinese
exporters.
6.58. Furthermore, by using historical shares of total US imports from China from prior to the
imposition of the anti-dumping orders, the formula-based approach assumes that the share of the
Chinese exporters subject to WTO-inconsistent anti-dumping duties would be the same in the year
prior to the imposition of the anti -dumping orders and in the counterfactual scenario for 2017. In
other words, the formula -based approach assumes that other factors occurring between the
imposition of the anti -dumping orders and 2017 would not have any impact on US imports from
China. While the United States argues that the historical share is an appropriate reference point237,
it provides no evidence demonstrating that this is a reasonable assumption. 238 In light of this, we
do not consider that it would be reasonable to assume that the share of the Chinese exporters
subject to WTO-inconsistent anti-dumping duties would necessarily be the same in the year prior to
the imposition of the anti-dumping orders and in the counterfactual scenario for 2017.
6.59. For these reasons, we do not consider that th e formula-based approach is an appropriate
methodology for estimating the level of nullification or impairment concerning the anti -dumping
orders at issue. We therefore proceed to assess the United States' second proposed calculation
methodology, the Armington model.

231 United States' response to Arbitrator question No. 43, para. 175.
232 United States' response to Arbitrator question No. 5, para. 20.
233 United States' response to Arbitrator question No. 44, para. 178.
234 United States' response to Arbitrator question No. 43, para. 175.
235 United States' response to Arbitrator question No. 38(a), para. 141.
236 See section 5.2 above. We further note that, under the counterfactual that the United States
proposes, not all Chinese exporters would be subject to the same level of anti-dumping duties. As explained in
section 5.2.2 above, the United States proposes to reduce the anti-dumping duties for cooperating exporters
within the PRC-wide entity from the PRC-wide duty rate to the separate duty rate, assigned to Chinese
exporters that passed the Separate Rate Test but were not chosen for individual examination. While the duty
rates would thus be the same for these exporters under the counterfactual that the United States proposes,
they would not necessarily be the same for exporters that were chosen for individual examination or
non-cooperating exporters within the PRC-wide entity, for which the United States proposes to maintain the
PRC-wide duty rate.
237 United States' response to Arbitrator question No. 5, para. 20.
238 In fact, the United States appears to contradict the assumption underlying its proposed formula-
based approach in arguing that China's proposed DID tabular approach is not appropriate for estimating the
level of nullification or impairment concerning the anti-dumping orders at issue. More particularly, in arguing
that China's proposed DID tabular approach is not appropriate, the United States emphasizes that the
evolution of US imports are impacted by factors other than simply the anti-dumping duties. (United States'
written submission, paras. 123, 125, and 148; and response to Arbitrator question No. 17, paras. 66-67).

6.2.2.3 Assessment of the Armington model
6.60. As explained above, the Armington model simulates the impact, in the US market, of reducing
the WTO-inconsistent anti-dumping duties from the actual duty rates to the counterfactual duty
rates. China argues tha t this model is not appropriate because it is not designed for the
circumstances surrounding the anti -dumping orders at issue. More particularly, China argues that
the accuracy of the Armington model depends, in part, on the changes between the actual 2017
duty rates and the counterfactual duty rates being small 239 and the size and duration of the
anti-dumping duties not being such that the exporters have almost been driven out of the market.240
We address these arguments below.241
6.2.2.3.1 Level of changes in the duty rates
6.61. China contends that the Armington model can only provide valid results when simulating small
changes in duty rates, and has provided a graphical analysis to support its contention.242 In China's
view, the changes from the actual 2017 duty rates to the counterfactual duty rates are too large to
yield valid results for "many of the major cases underlying this dispute".243 The United States argues
that there is no reason to suggest that the estimates that the Armington model generates are
inaccurate when the changes in duty rates are large, since the price elasticity of demand varies with
the size of the changes in the duty rates.244
6.62. The graphical analysis that China provided relates to the issue of calculating elasticities, not
to China's assertion that the Armington model cannot accurately simulate large changes in duty
rates. We therefore consider that China has not provided evidence demonstrating the alleged
inaccuracy of the Armington model when simulating large changes in duty rates. Furthermore, and
as pointed out by the United States, one can mathematically demonstrate the accuracy of the
Armington model when simulating large changes in duty rates, since applying the Armington model
to simulate the impact of a large duty rate change yields the same resu lt as the cumulated result
yielded by dividing that large duty rate change into many small steps and applying the Armington
model to simulate the impact associated with each step. 245 For these reasons, we do not consider
that the Armington model is unsuitabl e for estimating the level of nullification or impairment
concerning the anti -dumping orders at issue, regardless of whether the reduction of the
WTO-inconsistent anti-dumping duties, from the actual 2017 duty rates to the counterfactual duty
rates, is large.246
6.2.2.3.2 Small market shares resulting from the depressing effect of the
WTO-inconsistent anti-dumping duties
6.63. China points out that many of the anti -dumping orders at issue have driven down imports
from Chinese exporters subject to the WTO -inconsistent anti-dumping duties. China argues that it
is virtually impossible for the Armington model to estimate anything but very small levels of
nullification or impairment, where the 2017 market share of the Chinese exporters subject to the

239 China's written submission, paras. 185-187.
240 China's written submission, paras. 185 and 188-190.
241 China has also raised several points of criticism regarding the data used by the United States when
applying the Armington model to estimate the level of nullification or impairment concerning the anti-dumping
orders at issue. We address relevant arguments regarding data in section 7.1 below.
242 Economic Discussion of Technical Issues Concerning the Armington Model Used by the United States,
(Exhibit CHN-31 (BCI)). China also argues that the accuracy of measuring the economic effects depends on the
position along the demand curve and whether it lies within the continuous "interior" segment of the demand
curve. (Ibid). However, China has not provided any empirical evidence in support of this argument.
243 China's written submission, paras. 185-187.
244 United States' response to Arbitrator question No. 37(a), para. 132.
245 This method of dividing large changes into many small steps and calculating the adjustment in the
market equilibrium associated with each small step is often referred to as the multi-step Euler method. (See D.
Riker, Multinational Production and Employment in an Industry-Specific Model of Trade, Economics Working
Paper Series (Working Paper 2018-08-C), USITC (August 2018), (Exhibit USA-67)).
246 In addition, as explained in paragraph 6.42 above, the United States solves the Armington model
through a numerical iterative algorithm. Unlike solving the Armington model through a linear approximation,
the accuracy of the simulation using the Armington model is not affected by the size of the duty rate changes if
the model is solved through numerical iteration. (R. Hallren and D. Riker, An Introduction to Partial Equilibrium
Modeling of Trade Policy, Economics Working Paper Series (Working Paper 2017-07-B), USITC (July 2017),
(Exhibit USA-15)).

WTO-inconsistent anti-dumping duties is very small.247 The United States responds that, technically,
the Armington model can be used as long as the 2017 market share of the Chinese exporters subject
to the WTO-inconsistent anti-dumping duties is above 0%. 248 At the same time, the United States
acknowledges that the Armington model cannot be used to produce reliable estimates where the
share of US imports from the Chinese exporters subject to the WTO-inconsistent anti-dumping duties
is "minimal"249 or "close to zero"250, which, in turn, is the reason the United States proposes to use
the formula-based approach for anti -dumping orders where the share of the value of US imports
from the Chinese exporters subject to the WTO-inconsistent anti-dumping duties over the total value
of US imports from China in 2017 is less than 1%.251
6.64. As explained above, due to its intrinsic features, the United States' proposed Armington model
will necessarily simulate a small trade impact of reducing the WTO-inconsistent anti-dumping duties
if the exporters subject to these duties have a small market share in the reference period. We have
rejected the United States' approach of using a 1% threshold for applying the Armington model
because this threshold is arbitrary and is calculated using inputs that are not consistent wit h those
used in the Armington model. Rather than using an arbitrary threshold, we consider it appropriate
to focus our assessment on the intrinsic features of the Armington model and how such features
interact with the particular circumstances of the anti-dumping orders at issue, in considering whether
this model represents a reasonable methodology for estimating the level of nullification or
impairment.
6.65. Although the United States' proposed Armington model will simulate a small trade impact of
reducing the WTO-inconsistent anti-dumping duties where the market share in the reference period
is small, this does not necessarily render such results unreasonable so long as this small mar ket
share is not caused by the anti -dumping duties at issue. If the Chinese exporters subject to the
WTO-inconsistent anti-dumping duties have small 2017 market shares for reasons unrelated to these
duties – such as distance, language, cultural or political barriers – the small trade impact simulated
by the Armington model may be considered reasonable.252 If, however, the exporters subject to the
WTO-inconsistent anti-dumping duties have small 2017 market shares because of the depressing
effect of these duties, the small trade impact simulated by the Armington model may be considered
unreasonable because it understates the trade impact of reducing the anti -dumping duties. More
particularly, if the imposition of the WTO-inconsistent anti-dumping duties had a si gnificant
depressing effect on the 2017 market shares of the exporters, the reduction of these duties would
normally be expected to have a similarly significant trade impact, all other factors being equal. This
calls into question the reasonableness of using the Armington model under such circumstances since
this model, as explained above, necessarily simulates small trade impacts when the 2017 market
shares are small. The reasonableness of the estimated level of nullification or impairment simulated
using the Armington model thus depends on the particular circumstances of the anti-dumping orders
at issue.
6.66. Having reviewed the particular circumstances of the anti -dumping orders at issue, we note
that the market shares of the Chinese exporters subject to the W TO-inconsistent anti -dumping
duties have declined significantly from the year prior to the imposition of these duties to calendar
year 2017. More particularly, and as illustrated by the Figures in Annexes D-2 and D-3, the market
shares of the Chinese expor ters subject to the WTO -inconsistent anti-dumping duties all declined
sharply by 95.9% to 100%, for all of the anti -dumping orders at issue. This is so regardless of the
duration of the anti -dumping order and the level of the WTO -inconsistent anti -dumping duties.
Although the evolution of market shares is affected by different factors, for all of the anti -dumping
orders at issue, the market shares of the Chinese exporters subject to the WTO -inconsistent anti-
dumping duties experienced a significant decline following the imposition of the duties, which
suggests that the duties had significant depressing effects and resulted in the small 2017 market
shares. In light of this, we do not consider it reasonable to use a calculation methodology where the
depressed small 2017 market shares of the Chinese exporters subject to the WTO-inconsistent anti-
dumping duties will necessarily lead to small simulated trade impacts of reducing these duties, and
thus to a small estimated level of nullification or impairment. As ex plained in the previous

248 United States' response to Arbitrator question No. 37(b), para. 136.
251 United States' written submission, paras. 45 and 87.
252 See M. Kuiper and F. van Tongeren, "Using gravity to move Armington" (2006), Paper prepared for
the Ninth Annual Conference on Global Economic Analysis in Addis Ababa, Ethiopia.

paragraphs, if we apply the Armington model in the manner proposed by the United States, it will
yield exactly this outcome.
6.67. In light of these circumstances, we consider it necessary to adjust the United States' proposed
Armington model in order to address the small market shares resulting from the depressing effect
of the WTO-inconsistent anti-dumping duties at issue.
6.2.2.4 Adjustments to the United States' proposed Armington model
6.68. Above, we have determined that the United States' proposed Armington model requires
certain adjustments to address the small market shares resulting from the depressing effects of the
WTO-inconsistent anti-dumping duties. In this section, we consider possible adjustments to address
this issue. Furthermore, we consider possible adjustments to reflect the counterfactual determined
in section 5.3 above.
6.2.2.4.1 Adjustments to address the small market shares resulting from the depressing
effect of the WTO-inconsistent anti-dumping duties
6.69. As explained in section 6.2.2.3.2 above, we have determined that it is necessary to adjust
the United States' proposed Armington model in order to address the small market shares resulting
from the depressing effect of the WTO -inconsistent anti-dumping duties. To address this issue, we
proposed to the parties using the Armington model in two steps:
6.70. As the first step, the Armington model would be applied to the US market as it existed prior
to the imposition of the anti -dumping orders to simulate the impact of imposing the relevant anti -
dumping duties on the market shares of the Chinese exporters (both the Chinese exporters subject
to the WTO-inconsistent anti-dumping duties and the remaining Chinese exporters) , the exporters
from the rest of the world, and the US producers. The market share s of the Chinese exporters
simulated under the first step would then be applied to the actual 2017 total value of the US market
in order to obtain the simulated 2017 total value of US imports from China.
6.71. As the second step, the Armington model would be applied to the actual 2017 US market with
the market shares simulated under the first step to simulate the impact of reducing the
WTO-inconsistent anti-dumping duties from the actual duty rates to the counterfactual duty rates
on the value of US imports from China (both the Chinese exporters subject to the WTO-inconsistent
anti-dumping duties and the remaining Chinese exporters), the exporters from the rest of the world,
and the US producers .253 The value of US imports from China simulated under the second step
corresponds to the counterfactual value of US imports from China.
6.72. The estimated level of nullification or impairment would be obtained by calculating the
difference between the 2017 value of US imports from China, simulated under the first step, and the
counterfactual value of US imports from China, simulated under the second step.
6.73. The United States submits that it would be legally incorrect for the Arbitrator to adjust the
market shares to address China's arguments concerning the Armington model's inability to simulate
the impact of anti -dumping duties that have had depressing effects on trade levels. Since the
United States was not obligated to comply with the DSB recommendations and rulings until the
expiry of the reasonable period of time, the United States submits that the Arbitrator should estimate
the impact of the WTO -inconsistent anti -dumping duties only as of this point in time, by using
calendar year 2017 as the reference period. 254 China reiterates its arguments that the Armington
model cannot accurately simulate the impact of large duty rate changes 255, nor the impact of anti-
dumping duties that have been in place for long periods of time and have had depressing effects on
imports from Chinese exporters.256

253 For a similar approach, see Decision by the Arbitrator, US – Washing Machines (Article 22.6 – US),
paras. 3.114-3.119.
254 United States' opening statement at the meeting of the Arbitrator, para. 61; and response to
Arbitrator question No. 65, paras. 88-92.
255 China's response to Arbitrator question No. 65, paras. 45-47.
256 China's response to Arbitrator question No. 65, para. 48. China has also raised several arguments
concerning the reliability and lack of data which it considers necessary for applying the Armington model to

6.74. We agree with the United States that our mandate is to determine the level of nullification or
impairment caused by the United States' failure to implement the DSB recommendations and rulings
as of the expiry of the reasonable period of time. Since the United States did not implement the DSB
recommendations and rulings by the expiry of the reasonable period of time, our mandate
necessarily requires us to estimate what would have happened, had the United States done so. In
other words, we are required to rely on economic models or calculation me thodologies to simulate
what would have happened in a hypothetical scenario where the United States implemented the DSB
recommendations and rulings by the expiry of the reasonable period of time.
6.75. Such models or methodologies may have intrinsic features tha t render them more or less
reasonable depending on the specific circumstances. In such a case, our mandate requires us to
make the necessary adjustments to the model or methodology at issue, to ensure that the simulated
result represents a reasonable estimation of the level of nullification or impairment. Above, we have
determined that the United States' proposed Armington model cannot produce a reasonable estimate
of the level of nullification or impairment concerning the anti-dumping orders at issue because the
WTO-inconsistent anti-dumping duties have had significant depressing effects on the 2017 market
shares of the Chinese exporters subject to these duties. To address this issue, we find it appropriate
to apply the Armington model in two steps, in the manner described in paragraph s 6.69 through
6.72 above, to take into account the depressing effect of the WTO-inconsistent anti-dumping duties.
In our view, this approach will result in a reasonable estimat e of the level of nullification or
impairment. We wish to underline that, by applying the Armington model in two steps, we do not
move away from the principle that the level of nullification or impairment should be estimated as of
the expiry of the reasonable period of time. We are making our estimate as of that date, but we are
simulating the 2017 market shares to reflect the imposition of the relevant anti -dumping duties
while taking into account these duties' depressing effects, in order to address intrinsic features of
the United States' proposed Armington model that would otherwise render the estimated level of
nullification or impairment unreasonable.
6.76. Turning to China's arguments, we recall that we have already rejected the argument that the
Armington model cannot simulate the impact of large changes in duty rates.257 We see no reason to
address this argument differently in the context of our proposed approach to use the Armington
model in two steps. Further, our proposed approach of using the Armington model in two steps is
meant to addre ss the very concerns China raised regarding the Armington model's ability to
accurately estimate the level of nullification or impairment concerning anti -dumping orders where
the 2017 market shares of the Chinese exporters subject to the WTO -inconsistent anti-dumping
duties are small due to the depressing effect of these duties.
6.77. For these reasons, we consider that it is appropriate to use the Armington model in two steps
in order to estimate the level of nullification or impairment concerning the anti -dumping orders at
issue.
6.2.2.4.2 Adjustments to reflect the counterfactual determined by the Arbitrator
6.78. As explained in section 5.3 above, we have determined a counterfactual tha t entails the
reduction of the anti -dumping duties that were calculated using the WTO -inconsistent WA -T
methodology with zeroing and the WTO-inconsistent Single Rate Presumption. More particularly,
with respect to Coated Paper, we are using a 0.00% duty rate as the counterfactual for the exporter
APP-China, for the exporters that are subject to the separate duty rate, and for the exporters within
the PRC-wide entity that are subject to the PRC-wide duty rate. With respect to OCTG, we are using
a [[***]]% duty rate as the counterfactual for the exporter TPCO and for the exporters that are
subject to the separate duty rate, and we are using a 0.00% duty rate as the counterfactual for the
exporters within the PRC -wide entity that are subject to the PRC -wide duty rate. With respect to
Steel Cylinders, we are using a 0.00% duty rate as the counterfactual for the exporters that are
subject to the separate duty rate and for the exporters within the PRC -wide entity that are subject
to the PRC -wide duty rate. With respect to Aluminum Extrusions ; Bags Diamond Sawblades ;
Furniture; OTR Tires; PET Film; Ribbons; Shrimp; Solar Panels; Wood Flooring; Copper Pipe and
Tube; Iron Pipe Fittings; Passenger Vehicle and Light Truck Tires ; Residential Washers; Sheet and
Strip; Steel Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel Products; Steel Standard,

estimate the level of nullification or impairment concerning the anti-dumping orders at issue. We address
relevant arguments regarding data in section 7.1 below.
257 See section 6.2.2.3.1 above.

Line, and Pressure Pipe; and Steel Wire Rod, we are using a 0.00% duty rate as the counterfactual
for the exporters within the PRC -wide entity that are subject to the PRC -wide duty rate. We are
maintaining all other duty rates imposed under the anti -dumping orders at issue, without any
modification.
6.79. As explained in paragraph 6.41 above, the United States proposes an Armington model with
four varieties of the product for each anti-dumping order: (i) variety produced in the United States
(𝑢𝑠); (ii) variety imported fro m the Chinese exporters subject to WTO -inconsistent anti-dumping
duties ( 𝑝𝑟𝑐); (iii) variety imported from the remaining Chinese exporters ( 𝑟𝑜𝑐); and (iv) variety
imported from the rest of the world ( 𝑟𝑜𝑤). The variety of the product imported from the Chinese
exporters subject to WTO-inconsistent anti-dumping duties only covers imports of the product from
exporters within the PRC-wide entity that are subject to the WTO-inconsistent PRC-wide duty rate.258
6.80. To ensure that we estimate the level of nullifi cation or impairment concerning the USDOC's
use of both the WTO-inconsistent WA-T methodology with zeroing and the WTO-inconsistent Single
Rate Presumption, we need to adjust the United States' proposed Armington model by creating a
fifth variety of the pr oduct for the anti -dumping orders where we are reducing the duty rates
calculated using the WA -T methodology with zeroing, that is Coated Paper , OCTG, and Steel
Cylinders. More particularly, for these three orders, we will apply the Armington model with th e
following five varieties of the product at issue: (i) variety produced in the United States (𝑢𝑠); (ii)
variety imported from the Chinese exporters subject to the WTO-inconsistent WA-T duty rates (𝑤𝑎𝑡)
(iii) variety imported from the Chinese exporter s subject to the WTO -inconsistent PRC-wide duty
rates ( 𝑝𝑟𝑐); (iv) variety imported from the remaining Chinese exporters ( 𝑟𝑜𝑐); and (v) variety
imported from the rest of the world ( 𝑟𝑜𝑤). In more technical terms, the Armington model with five
varieties is specified by the following set of equations representing the supply and the demand of
each of the five varieties of the product (equations 7 to 11) as well as an aggregate product demand
(equation 12) and a price index (equation 13):

258 United States' written submission, para. 63. Despite acknowledging that it should estimate the level
of nullification or impairment concerning the USDOC's use of the WTO-inconsistent WA-T methodology with
zeroing in at least certain anti-dumping orders, the United States does not include a fifth variety of the product
imported from the Chinese exporters subject to the WTO-inconsistent WA-T duty rates. (United States' written
submission, paras. 104-107). As explained in sections 5.2.1.2 and 5.2.1.3 above, the United States argues
that the level of nullification or impairment concerning the USDOC's use of the WA-T methodology with zeroing
in OCTG and Steel Cylinders should be estimated to be zero. For Coated Paper, the United States calculates the
level of nullification or impairment concerning the USDOC's use of the WA-T methodology with zeroing by
applying the four-variety Armington model. (United States' written submission, paras. 102-109).

US domestic production market
equilibrium: 𝑎𝑢𝑠 (𝑝𝑢𝑠)𝜀𝑢𝑠 = 𝑄 𝑏𝑢𝑠
𝜎 (𝑝𝑢𝑠
𝑃 )
−𝜎
 (7)
US imports from Chinese exporters
subject to WTO-inconsistent WA-T
duty rates market equilibrium:
 𝑎𝑤𝑎𝑡 (𝑝𝑤𝑎𝑡
𝑡𝑤𝑎𝑡

𝜀𝑤𝑎𝑡
= 𝑄 𝑏𝑤𝑎𝑡
𝜎 (𝑝𝑤𝑎𝑡
𝑃 )
−𝜎
 (8)
US imports from Chinese exporters
subject to WTO-inconsistent PRC-
wide duty rates market equilibrium:
 𝑎𝑝𝑟𝑐 (
𝑝𝑝𝑟𝑐
𝑡𝑝𝑟𝑐

𝜀𝑝𝑟𝑐
= 𝑄 𝑏𝑝𝑟𝑐
𝜎 (
𝑝𝑝𝑟𝑐
𝑃 )
−𝜎
 (9)
US imports from the rest of China
market equilibrium: 𝑎𝑟𝑜𝑐 (𝑝𝑟𝑜𝑐)𝜀𝑟𝑜𝑐 = 𝑄 𝑏𝑟𝑜𝑐
𝜎 (𝑝𝑟𝑜𝑐
𝑃 )
−𝜎
 (10)
US imports from the rest of the world
market equilibrium: 𝑎𝑟𝑜𝑤 (𝑝𝑟𝑜𝑤)𝜀𝑟𝑜𝑤 = 𝑄 𝑏𝑟𝑜𝑤
𝜎 (𝑝𝑟𝑜𝑤
𝑃 )
−𝜎
 (11)
US aggregate market equilibrium: 𝑄 = 𝑌0𝑃θ (12)
US price index
𝑃 = (𝑏𝑢𝑠
𝜎𝑝𝑢𝑠1−𝜎 + 𝑏𝑤𝑎𝑡
𝜎𝑝𝑤𝑎𝑡1−𝜎 + 𝑏𝑝𝑟𝑐
𝜎𝑝𝑝𝑟𝑐1−𝜎
+𝑏𝑟𝑜𝑐
𝜎𝑝𝑟𝑜𝑐1−𝜎 + 𝑏𝑟𝑜𝑤
𝜎𝑝𝑟𝑜𝑤1−𝜎)
1
1−𝜎
(13)

6.2.2.5 Conclusion
6.81. For the reasons explained above, we consider that it is appropriate to apply the Armington
model in two steps for the anti -dumping orders at issue. For 22 of the anti -dumping orders at
issue259, we will apply the Armington model with four varieties of the product, and for the remaining
three anti-dumping orders at issue260, we will apply the Armington model with five varieties of the
product. We now turn to determine how to implement this calculation methodology with respect to
each of the anti-dumping orders at issue.
7 ARBITRATOR'S IMPLEMENTATION OF THE CHOSEN METHODOLOGY
7.1. Above, we have determined that it is appropriate to apply the Armington model in two steps,
with either four or five varieties of the product, in order to estimate the level of nulli fication or
impairment concerning the anti-dumping orders at issue.
7.2. As the first step, we will apply the Armington model to the US market as it existed prior to the
imposition of the anti-dumping orders in order to simulate, for each anti-dumping order, the impact
of imposing the relevant anti-dumping duties on the market shares of the Chinese exporters (both
the Chinese exporters subject to the WTO -inconsistent anti -dumping duties and the remaining
Chinese exporters), the exporters from the rest of the world, and the US producers. We will then
apply the market shares of the Chinese exporters simulated under the first step to the actual 2017
total value of the US market in order to obtain the simulated 20 17 total value of US imports from
China.
7.3. As the second step, we will apply the Armington model to the actual 2017 US market with the
market shares simulated under the first step in order to simulate, for each anti-dumping order, the
impact of reducing the WTO-inconsistent anti -dumping duties from the actual duty rates to the
counterfactual duty rates on the value of US imports from China (both the Chinese exporters subject
to the WTO-inconsistent anti-dumping duties and the remaining Chinese exporters), the exporters

259 Aluminum Extrusions; Bags; Diamond Sawblades; Furniture; OTR Tires; PET Film; Ribbons; Shrimp;
Solar Panels; Wood Flooring; Copper Pipe and Tube; Iron Pipe Fittings; Passenger Vehicle and Light Truck
Tires; Residential Washers; Sheet and Strip; Steel Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel
Products; Steel Standard, Line, and Pressure Pipe; and Steel Wire Rod.
260 Coated Paper; OCTG; and Steel Cylinders.

from the rest of the world, and the US producers.261 The value of US imports from China simulated
under the second step corresponds to the counterfactual value of US imports from China.
7.4. We will then estimate the level of nullification or impairmen t concerning the anti -dumping
orders at issue by calculating, for each order, the difference between the 2017 value of US imports
from China, simulated under the first step, and the counterfactual value of US imports from China,
simulated under the second step.
7.5. For the 22 anti -dumping orders that concern only the USDOC's use of the WTO -inconsistent
Single Rate Presumption 262, we will implement the Armington model with four varieties of the
product: (i) variety produced in the United States (𝑢𝑠); (ii) variety imported from the Chinese
exporters subject to the WTO-inconsistent PRC-wide duty rates (𝑝𝑟𝑐); (iii) variety imported from the
remaining Chinese exporters (𝑟𝑜𝑐); and (iv) variety imported from the rest of the world ( 𝑟𝑜𝑤). For
the three anti -dumping orders that concern the USDOC's use of the WTO -inconsistent WA -T
methodology with zeroing as well as the WTO -inconsistent Single Rate Presumption 263, we will
implement the Armington model with five varieties of the product: (i) variety produced in the
United States (𝑢𝑠); (ii) variety imported from the Chinese exporters subject to the WTO-inconsistent
WA-T duty rates (𝑤𝑎𝑡); (iii) variety imported from the Chinese exporters subject to the
WTO-inconsistent PRC -wide duty rates ( 𝑝𝑟𝑐); (iv) variety imported from the remaining Chinese
exporters (𝑟𝑜𝑐); and (v) variety imported from the rest of the world (𝑟𝑜𝑤).
7.6. Below, we determine the relevant data inputs required to implement the Armington model in
two steps in the manner described above. Then, we provide the results for the anti-dumping orders
at issue. Finally, we provide our estimated level of nullification or impairment concerning these
anti-dumping orders.
7.1 Data inputs
7.7. In order to implement the Armington model under the first step, we need information on the
total value of the US market in the year prior to the imposition of the anti-dumping orders at issue
and the corresponding market shares of the US domestic producers, the Chinese exporters subject
to the WTO-inconsistent anti-dumping duties, the remaining Chinese exporters, and the exporters
from the rest of the world. We also need the total demand elasticity, the elasticity of substitution,
and the supply elasticities for US domestic shipments and the different sources of US imports. Finally,
we need information on the actual 2017 duty rates in order to simulate the impact of imposing the
anti-dumping duties.
7.8. The implementation of the Armington model under the first step will provide us with the
simulated market shares following the imposition of the relevant anti-dumping duties, which we, in
turn, use as data inputs for the implementation of the Armington model under the second step. For
the second step, we will use the same elasticities used in the first step. The only new info rmation
required to implement the Armington model under the second step concerns the total value of the
US market in 2017 as well as the counterfactual duty rates for the WTO -inconsistent anti-dumping
duties.
7.9. Below, we explain how we have selected each of the data inputs described above. At the outset,
we note that most of the required data inputs were not directly available, and we were required to
rely on the best information available. In choosing what information to rely on, we have taken into
account b oth parties' views as well as the need to rely on "credible, factual, and verifiable
information"264, while bearing in mind practical difficulties and limits.

261 For a similar approach, see Decision by the Arbitrator, US – Washing Machines (Article 22.6 – US),
paras. 3.114-3.119.
262 Aluminum Extrusions; Bags; Diamond Sawblades; Furniture; OTR Tires; PET Film; Ribbons; Shrimp;
Solar Panels; Wood Flooring; Copper Pipe and Tube; Iron Pipe Fittings; Passenger Vehicle and Light Truck
Tires; Residential Washers; Sheet and Strip; Steel Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel
Products; Steel Standard, Line, and Pressure Pipe; and Steel Wire Rod.
263 Coated Paper; OCTG; and Steel Cylinders.
264 Decision by the Arbitrator, US – 1916 Act (EC) (Article 22.6 – US), para. 5.63. See also Decisions by
the Arbitrators, US – COOL (Article 22.6 – US), para. 4.5; US – Tuna II (Mexico) (Article 22.6 – US), para. 5.2;
and US – Washing Machines (Article 22.6 – US), para. 1.16.

7.1.1 Total market value and market shares
7.10. For the 22 anti-dumping orders that only concern the USDOC's u se of the WTO-inconsistent
Single Rate Presumption 265, the total value of the US market (𝑌) is composed of the value of US
shipments (𝑋𝑢𝑠); the value of US imports from the Chinese exporters subject to the WTO-inconsistent
PRC-wide duty rates (𝑋𝑝𝑟𝑐); the value of US imports from the remaining Chinese exporters ( 𝑋𝑟𝑜𝑐),
and the value of US imports from exporters from the rest of the world (𝑋𝑟𝑜𝑤):
Total value of the US market:
(four variety-market) 𝑌 = 𝑋𝑢𝑠 + 𝑋𝑝𝑟𝑐 + 𝑋𝑟𝑜𝑐 + 𝑋𝑟𝑜𝑤 (14)

7.11. The market share of each product variety is determined by dividing the value of each variety
by the total value of the US market:
Market shares:
𝑚𝑢𝑠 = 𝑋𝑢𝑠
𝑌 𝑚𝑝𝑟𝑐 =
𝑋𝑝𝑟𝑐
𝑌
(15)
𝑚𝑟𝑜𝑐 = 𝑋𝑟𝑜𝑐
𝑌 𝑚𝑟𝑜𝑤 = 𝑋𝑟𝑜𝑤
𝑌

7.12. For the three anti -dumping orders that concern the USDOC's use of the WTO -inconsistent
WA-T methodology with zeroing as well as the WTO -inconsistent Single Rate Presumption 266, the
total value of the US market (𝑌) is composed of the value of US shipments ( 𝑋𝑢𝑠); the value of US
imports from the Chinese exporters subject to the WTO -inconsistent WA-T duty rates (𝑋𝑤𝑎𝑡); the
value of US imports from the Chinese exporters subject to the WTO -inconsistent PRC-wide duty
rates (𝑋𝑝𝑟𝑐); the value of US imports from the remaining Chinese exporters (𝑋𝑟𝑜𝑐), and the value of
US imports from exporters from the rest of the world (𝑋𝑟𝑜𝑤):
Total value of the US market:
(five variety-market) 𝑌 = 𝑋𝑢𝑠 + 𝑋𝑤𝑎𝑡 + 𝑋𝑝𝑟𝑐 + 𝑋𝑟𝑜𝑐 + 𝑋𝑟𝑜𝑤 (16)

7.13. Again, the market share of each product variety is determined by dividing the value of each
variety by the total value of the US market:
Market shares:
𝑚𝑢𝑠 = 𝑋𝑢𝑠
𝑌 𝑚𝑤𝑎𝑡 = 𝑋𝑤𝑎𝑡
𝑌
(17) 𝑚𝑝𝑟𝑐 = 𝑋𝑝𝑟𝑐
𝑌 𝑚𝑟𝑜𝑐 = 𝑋𝑟𝑜𝑐
𝑌
𝑚𝑟𝑜𝑤 = 𝑋𝑟𝑜𝑤
𝑌
7.1.1.1 Value of US shipments
7.14. The value of US shipments of a given product corresponds to the value of US domestic
production of that product sold in the US market. To implement the Armington model under the first
step, we need data on the value of US shipments in the year pr ior to the imposition of the
anti-dumping orders in order to construct the total value of the US market and the market shares
in that year. To implement the Armington model under the second step, we need data on the value
of US shipments in 2017 in order t o construct the total value of the US market in 2017. Below, we
explain how we obtained each of these data inputs.
7.15. With respect to the value of US shipment s in the year prior to the imposition of the
anti-dumping orders, the United States relies on the pub lic version of the United States
International Trade Commission's (USITC) investigation reports, industry-specific survey data by the

265 Aluminum Extrusions; Bags; Diamond Sawblades; Furniture; OTR Tires; PET Film; Ribbons; Shrimp;
Solar Panels; Wood Flooring; Copper Pipe and Tube; Iron Pipe Fittings; Passenger Vehicle and Light Truck
Tires; Residential Washers; Sheet and Strip; Steel Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel
Products; Steel Standard, Line, and Pressure Pipe; and Steel Wire Rod.
266 Coated Paper; OCTG; and Steel Cylinders.

US Census Bureau , data from the USITC DataWeb, and data provided by private companies to
compute the value of US shipments.267 The United States makes further assumptions to derive the
value of US shipments for the anti-dumping orders at issue for which there is no information available
for the relevant years.268 China rejects the data provided by the United States on the grounds that
the data sources are questionable and that the assumptions made by the United States are arbitrary
and not verifiable.269 China generally proposes to use information available in USITC investigation
reports where such information is available 270, but proposes to use information by the Association
of Home Appliance Manufacturers (AHAM) to infer the value of US shipments for one anti -dumping
order, Residential Washers, because this information is confidential and not available in the relevant
USITC report.271
7.16. We note that data on the value of US shipments often needs to be inferred because such
statistics are often not directly available, especially at the product -specific level. Having reviewed
the parties' proposed data, we consider it appropriate to use the data reported in the publicly
available USITC investigation reports for the 20 anti -dumping orders at issue where such da ta is
available.272 For the remaining five anti-dumping orders at issue, the data on US shipments reported
in the USITC reports is not available because the data is confidential.273 For four of these five
anti-dumping orders, the only data on record for the value of US shipments is that provided by the
United States.274 Although China criticizes this data for not being publicly available or verifiable 275,
China has not provided evidence that this data is unreliable, nor suggested alternative data. For this
reason, we consider the data provided by the United States to be the best available, and we therefore
use the values of US shipments estimated by the United States on the basis of data from the relevant
USITC investigation reports, annual surveys of manufacturers by the US Census Bureau, data from
USITC DataWeb, and data from private companies.276 For the remaining anti -dumping order,

267 Calculations on US Shipments, (Exhibit USA-58).
268 United States' response to Arbitrator question No. 31(a), paras. 122-123.
269 China's written submission, paras. 182-183.
270 China's comments on the United States' response to Arbitrator question No. 65, paras. 77-78. China
also proposes to apply its DID tabular approach for the anti-dumping orders for which there is no publicly
available information on US shipments in the USITC investigation reports. (See Data Required for
Implementing the Armington Model Under Two Steps, (Exhibit CHN-55 (BCI))).
271 For Residential Washers, China proposes to estimate the value of US shipments by subtracting the
value of US imports from the total value of the US market provided by AHAM. (China's comments on the
United States' response to Arbitrator question No. 65, para. 80; and Supporting Documents for Data Required
for Implementing the Armington Model Under Two Steps, (Exhibit CHN-56 (BCI))).
272 Aluminum Extrusions; Bags; Coated Paper; Furniture; OCTG; OTR Tires; PET Film; Shrimp; Solar
Panels; Wood Flooring; Copper Pipe and Tube; Passenger Vehicle and Light Truck Tires; Sheet and Strip; Steel
Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel Products; Steel Standard, Line, and Pressure Pipe;
and Steel Wire Rod. (See Annex E-1, which reports the US shipment values in the year prior to the imposition
of the anti-dumping orders and the data sources used to estimate these values). For six of these 20 anti-
dumping orders, namely OCTG; PET Film; Shrimp; Sheet and Strip; Steel Line Pipe; and Steel Wire Rod, the
USITC investigation reports do not provide data for the full calendar year but only for the first six or nine
months of the year. In such cases, we annualize the relevant data to estimate the annual value of US
shipments by dividing the data by the corresponding number of months and multiplying the result by 12 (i.e.
the number of months in a year). For one anti-dumping order, Solar Panels, the data from the USITC
investigation report concerns solar modules, whereas the anti-dumping order covers solar cells whether or not
assembled into modules. We note the USITC's explanation that the use of US domestic shipments data
concerning only solar modules is meant to avoid double counting, since many domestically produced solar cells
are used in the production of solar modules by the same firm. (See Calculations on US Shipments, (Exhibit
USA-58); and USITC Publication 4360). We further note that neither party has proposed alternative data. For
these reasons, we consider the data from the USITC investigation report on Solar Panels to be the best
available, and use this data to determine the value of US shipments in the year prior to the imposition of the
anti-dumping order. For one anti-dumping order, Steel Wire Rod, China argues that there is no information
available on the value of US shipments in the year prior to the imposition of the anti-dumping order.
(Supporting Documents for Data Required for Implementing the Armington Model Under Two Steps, (Exhibit
CHN-56 (BCI))). However, we note that USITC publication 4509 does provide information on the value of US
shipments for January to June 2014, the year prior to the imposition of the anti-dumping order. (See USITC
publication 4509). As mentioned above, we annualize this data to estimate the total value of US shipments in
the year prior to the imposition of the anti-dumping order.
273 Diamond Sawblades; Ribbons; Steel Cylinders; Iron Pipe Fittings; and Residential Washers.
274 Diamond Sawblades; Ribbons; Steel Cylinders; and Iron Pipe Fittings.
275 China's written submission, paras. 182-183.
276 More particularly, for Diamond Sawblades, we use the value of US shipments provided by the
United States based on adjusted data from the relevant USITC investigation report. For Ribbons, we use the
value of US shipments provided by the United States based on adjusted data from the US Census Bureau's
Annual Survey of Manufacturers and the USITC DataWeb. For Steel Cylinders, we use the value of US

Residential Washers, we estimate the value of US shipments by subtracting the value of US imports
from Chinese exporters and exporters from the rest of the world from the total value of the US
market.277 The total value of the US market of Residential Washers is obtained from data compiled
by AHAM278, and the value of US imports is obtained from data compiled by US Customs and the US
Census Bureau.279
7.17. With respect to the value of US shipment s in 2017, the United States also relies on the
public version of the USITC investigation reports280, industry-specific survey data by the US Census
Bureau, data from the USITC DataWeb, data provided by other US agencies, and data provided by
private companies or industry associations.281 China rejects the data provided by the United States
on the grounds that the data sources are questionable and that the assumptions made by the
United States are arbitrary and not verifiable.282 China has not submitted any data from 2017 and
instead proposes to use the values of the US market, including the value of US shipments, in the
year prior to the imposition of the anti -dumping orders with adjustments for inflation by applying
the United States' gross domestic product (GDP) deflator.283
7.18. In our view, China's suggestion to use inflation -adjusted values from the year prior to the
imposition of the anti-dumping orders, rather than 2017 values, is not reasonable or objective. We
recall that our mandate is to determine the level of nullification or impairment caused by the
United States' failure to implement the DSB recommendations and rulings by the expiry of the
reasonable period of time. We also recall that the parties agree d to use calendar year 2017 as the
reference period.284 Thus, we consider it appropriate to use the actual 2017 values of the US market,
including the actual 2017 value of US shipments, when applying the Armington model to simulate
the impact of reducing the WTO-inconsistent anti-dumping duties from the actual 2017 duty rates
to the counterfactual duty rates. If we were to use the values of the US market in the year prior to
the imposition of the anti -dumping orders, inflation-adjusted or not, we would be sim ulating the
impact of reducing the WTO-inconsistent anti-dumping duties at a point in time where these duties
had not yet been imposed. In our view, this would not be in accordance with our mandate.
7.19. Having determined that it is not appropriate to use infla tion-adjusted values from the year
prior to the imposition of the anti-dumping orders, as proposed by China, we note that the only data
on record for the value of US shipments in 2017 is that provided by the United States.285 Although
China criticizes this data for not being publicly available or verifiable 286, China has not provided
evidence that this data is unreliable, nor suggested alternative data. For this reason, we consider
the data provided by the United States to be the best available. We theref ore use the 2017 values

shipments provided by the United States based on data from the annual report by the only US producer,
Trimas Corporation. For Iron Pipe Fittings, we use the value of US shipments provided by the United States
based on data from the US Census Bureau's Annual Survey of Manufacturers and the USITC DataWeb. (See
Annex E-1, which reports the US shipment values in the year prior to the imposition of the anti-dumping orders
and the data sources used to estimate these values).
277 See Annex E-1, which reports the US shipment values in the year prior to the imposition of the anti-
dumping orders and the data sources used to estimate these values.
278 Supporting Documents for Data Required for Implementing the Armington Model Under Two Steps,
(Exhibit CHN-56 (BCI)).
279 In paragraph 7.22 below, we describe how we estimate the value of US imports from China in the
year prior to the imposition of the anti-dumping orders using data from US Customs. In paragraph 7.32 below,
we describe how we estimate the value of US imports from the rest of the world in the year prior to the
imposition of the anti-dumping orders using data from the US Census Bureau.
280 Data on the 2017 value of US shipments is not directly available in USITC investigation reports for
some anti-dumping orders, and for these orders the United States applies assumptions based on data from the
USITC investigation reports to derive the 2017 value of US shipments. (Calculations on US Shipments, (Exhibit
USA-58)).
281 Calculations on US Shipments, (Exhibit USA-58).
282 China's written submission, paras. 182-183.
283 China's response to Arbitrator question No. 65, paras. 53-55; and comments on the United States'
response to Arbitrator question No. 65, para. 86; Data Required for Implementing the Armington Model Under
Two Steps, (Exhibit CHN-55 (BCI)); and Supporting Documents for Data Required for Implementing the
Armington Model Under Two Steps, (Exhibit CHN-56 (BCI)). For Residential Washers, China submits an
estimate of the 2017 total market value based on data from AHAM.
284 See section 4 above.
285 Calculations on US Shipments, (Exhibit USA-58).
286 China's written submission, paras. 182-183.

of US shipments provided by the United States for all anti -dumping orders at issue 287, except
Residential Washers. To ensure consistency, for Residential Washers, we use the same data source
that we used to construct the value of US s hipments in the year prior to the imposition of the
anti-dumping orders, by subtracting the 2017 value of US imports from Chinese exporters and
exporters from the rest of the world, based on data from US Customs and the US Census Bureau288,
from the total 2017 value of the US market, based on data from AHAM.289
7.1.1.2 Value of US imports from China
7.20. To implement the Armington model under the first step, we need data on the value of
US imports from China in the year prior to the imposition of the anti -dumping orders in order to
construct the total value of the US market and the market shares in that year. To implement the
Armington model under the second step, we need data on the value of US imports from China in
2017 in order to construct the total value of the US marke t in 2017. Below, we explain how we
obtained each of these data inputs.
7.21. With respect to the value of US imports from China in the year prior to the imposition
of the anti -dumping orders, the United States points out that US Customs does not track the
value of imports subject to anti -dumping duties in years before the duties are impose d. T he
United States therefore relies on aggregated data on US imports from China obtained from the US
Census Bureau and applies the reference HTS codes used by US Customs to identify the scope of
products that may be subject to anti -dumping duties.290 China proposes to use the value of US
imports from China in the year prior to the imposition of the anti -dumping orders published in the
relevant USITC investigation reports.291 When such information is not available for confidentiality
reasons, China proposes to use company-specific trade data compiled by US Customs and aggregate
this data to determine the value of US imports from China.292
7.22. For consistency, we follow the same approach as we followed to obtain the value of US
shipments and rely on the relevant USITC investigation reports to retrieve information for nine
anti-dumping orders where such information is available. 293 For the remain ing 16 anti-dumping

287 More particularly, for 13 anti-dumping orders, Aluminum Extrusions; Bags; Coated Paper; Diamond
Sawblades; Furniture; OTR Tires; PET Film; Wood Flooring; Copper Pipe and Tube; Passenger Vehicle and Light
Truck Tires; Steel Flat Products; Steel Pipe; and Steel Standard, Line, and Pressure Pipe, we use the value of
US shipments provided by the United States based on adjusted data for 2017 or earlier years from the relevant
USITC investigation reports. For three anti-dumping orders, OCTG; Steel Cylinders; and Steel Line Pipe, we use
the value of US shipments provided by the United States based on data from private companies. For three
anti-dumping orders, Ribbons; Iron Pipe Fittings; and Steel Nails, we use the value of US shipments provided
by the United States based on adjusted data from the US Census Bureau's Annual Survey of Manufacturers.
For three anti-dumping orders, Sheet and Strip; Steel Products; and Steel Wire Rod, we use the value of US
shipments provided by the United States based on data from the USITC DataWeb and the American Iron and
Steel Institute. For Shrimp, we use the value of US shipments provided by the United States based on data
from the National Oceanic and Atmospheric Administration. For Solar Panels, we use the value of US shipments
provided by the United States based on price and production quantity data from the US Department of Energy
and the International Energy Agency. (See Annex E-8, which reports the US shipment values in 2017 and the
data sources used to estimate these values).
288 In paragraph 7.29 below, we describe how we estimate the value of US imports from China in 2017
using data from US Customs. In paragraph 7.34 below, we describe how we estimate the value of US imports
from the rest of the world in 2017 using data from the US Census Bureau.
289 See Annex E-8, which reports the values of US shipments in 2017 and the data sources used to
estimate these values.
290 Table of US imports from China, World, and Rest of the World in Selected Years, (Exhibit USA-57).
291 China's comments on the United States' response to Arbitrator question No. 65, paras. 77-78. We
note that China only uses the trade data reported in the USITC investigation report when the latter also
provides information on US shipments.
292 China's communication of 13 June 2019, pp. 2-3; Data Required for Implementing the Armington
Model Under Two Steps, (Exhibit CHN-55 (BCI)); and Table of US imports from China, World, and Rest of the
World in Selected Years, (Exhibit USA-57). China initially proposed to use data on US imports from China from
the US Census Bureau. (Table of US imports from China, World, and Rest of the World in Selected Years,
(Exhibit USA-57)).
293 Aluminum Extrusions; Coated Paper; OTR Tires; Wood Flooring; Copper Pipe and Tube; Passenger
Vehicle and Light Truck Tires; Steel Flat Products; Steel Pipe; and Steel Standard, Line and Pressure Pipe. (See
Annex E-1, which reports the values of US imports from China in the year prior to the imposition of the anti-
dumping orders and the data sources used to estimate these values).

orders294, the information on the value of US imports from China is not available in the USITC reports
for the full calendar year or not available at all for confidentiality reasons. Turning to the alternative
data sources proposed by the parties, we note that the United States' proposed import data from
the US Census Bureau is aggregated using the HTS codes used by US Customs to identify the scope
of products that may be subject to anti -dumping duties.295 As explained by the United States, this
data might overestimate the value of US imports from China since some of the imported products
may not be the type of product s actually subject to anti-dumping duties.296 We further note that ,
while the United States initially explained that it did not have access to company-specific trade data
on US imports from China for the year prior to the imposition of anti-dumping orders at issue297, it
has subsequently provided confidential company-specific trade data compiled by US Customs298, and
China proposes to use this data. 299 We also consider this company -specific information to be the
best available, and aggregate this data to determine the value of US imports from China whenever
the relevant USITC investigation reports do not provide the necessary data.300
7.23. To implement the first step, we further need to distinguish between the value of US imports
from the Chinese exporters subject to the WTO -inconsistent anti-dumping duties and the value of
US imports from the remaining Chinese exporters. For the 22 anti-dumping orders that concern only
the USDOC's use of the WTO -inconsistent Single Rate Presumption 301, we therefore need to
distinguish between the value of US imports from the Chinese exporters subject to the
WTO-inconsistent PRC-wide duty rates and the value of US imports from the remaining Chinese
exporters. For the three anti-dumping orders that concern the USDOC's use of the WTO-inconsistent
WA-T methodology with zeroing as well as the WTO -inconsistent Single Rate Presumption 302, we
need to distingu ish between the value of US imports from the Chinese exporters subject to the
WTO-inconsistent WA-T duty rates, the value of US imports from the Chinese exporters subject to
the WTO-inconsistent PRC-wide duty rates, and the value of US imports from the remaining Chinese
exporters.
7.24. To determine the value of US imports from the Chinese exporters subject to the
WTO-inconsistent PRC-wide duty rates for all of the anti -dumping orders at issue, we apply the
maximum share covered by the PRC-wide entity during the investigation period to the total value of
US imports from China in the year prior to the imposition of the anti-dumping orders. This maximum
share is calculated as the maximum share of the PRC-wide entity over total US imports from China
during the period of investigation. This maximum share will necessarily be an approximation because

294 Bags; Diamond Sawblades; Furniture; OCTG; PET Film; Ribbons; Shrimp; Solar Panels; Steel
Cylinders; Iron Pipe Fittings; Residential Washers; Sheet and Strip; Steel Line Pipe; Steel Nails; Steel
Products; and Steel Wire Rod.
295 Table of US imports from China, World, and Rest of the World in Selected Years, (Exhibit USA-57).
296 United States' response to Arbitrator question No. 71(a), para. 142.
297 United States' response to Arbitrator question No. 39(b), para. 152.
298 See Excel File with Import Data in the Year Preceding the Imposition of Anti-Dumping Duties,
(Exhibit USA-94 (BCI)).
299 China's communication of 13 June 2019, p. 3. For Solar Panels, China initially suggested that the
USITC investigation report contained publicly available information regarding the value of US imports from
China and provided such data in Exhibit CHN-55 (BCI). China subsequently indicated that it had made an
"important typographical error" in Exhibit CHN-55 (BCI). (China's communication of 13 June 2019, p. 3).
Although China did not specify the nature of its "important typographical error", it is clear from the USITC
investigation report on Solar Panels that it does not contain publicly available information on the value of
imports of solar cells from China, only the value of imports of solar modules from China. (Supporting
Documents for Data Required for Implementing the Armington Model Under Two Steps, (Exhibit CHN-56
(BCI))). The data proposed by China, in turn, reflects the value reported by the USITC for solar modules, not
solar cells. It is not uncommon for solar cells to be imported as such, for assembly into solar modules in the
United States, and we therefore do not believe it would be appropriate to use the data reported for solar
modules in the USITC investigation report and in Exhibit CHN-55 (BCI). Seeing as the data on the value of
imports of solar cells from China is not available in the USITC investigation report, we instead aggregate the
confidential company-specific trade data on US imports from China compiled by US Customs. (Excel File with
Import Data in the Year Preceding the Imposition of Anti-Dumping Duties, (Exhibit USA-94 (BCI))).
300 See Annex E-1, which reports the values of US imports from China in the year prior to the imposition
of the anti-dumping orders and the data sources used to estimate these values.
301 Aluminum Extrusions; Bags; Diamond Sawblades; Furniture; OTR Tires; PET Film; Ribbons; Shrimp;
Solar Panels; Wood Flooring; Copper Pipe and Tube; Iron Pipe Fittings; Passenger Vehicle and Light Truck
Tires; Residential Washers; Sheet and Strip; Steel Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel
Products; Steel Standard, Line, and Pressure Pipe; and Steel Wire Rod.
302 Coated Paper; OCTG; and Steel Cylinders.

US Customs does not track the value of imports subject to anti-dumping duties before such duties
are actually imposed.303
7.25. The United States has provided approximations of the maximum share of the PRC-wide entity
for all anti -dumping orders at issue. 304 More particularly, for each anti -dumping order, the
United States approximates the total value of imports from China during the period of investigation
based on aggregated USITC DataWeb monthly trade data for the HTS codes used by the USDOC in
the investigation. Using company -specific trade data from the period of investigation, reported by
the exporters themselves, the United States subtracts the value of US imports from exporters
outside the PRC-wide entity from the approximated total value of imports from China, and uses the
remaining value to calculate the maximum share of the PRC -wide entity. 305 For 19 of the
anti-dumping orders at issue306, China does not object to the maximum share of the PRC-wide entity
approximated by the United States307, and we also consider it reasonable to use this data.308 For the
remaining six anti-dumping orders at issue309, the United States estimates the maximum share of
the PRC -wide entity during the period o f investigation to be [[***]]%.310 According to the
United States, this is because the combined shares calculated for exporters outside the PRC -wide
entity exceed [[***]]% of US imports from China during the period of investigation.311 China objects
to the use of a [[***]]% maximum share for these six anti -dumping orders, and instead proposes
to replace the [[***]]% maximum share with the average maximum share of the PRC -wide entity
for the remaining anti-dumping orders.312 We are not convinced of the accuracy of the United States'
approximated [[***]]% maximum shares for the six anti-dumping orders, nor of the United States'
explanation thereof. More particularly, an analysis of company -specific trade data on US imports

303 United States' response to Arbitrator question No. 71(a), para. 142.
304 Calculated Maximum Share Covered by the PRC-Wide Entity, (Exhibit USA-54 (BCI)).
305 See United States' response to Arbitrator question No. 61, paras. 46-48; and Calculated Maximum
Share Covered by the PRC-Wide Entity, (Exhibit USA-54 (BCI)). We note that Exhibit USA-54 (BCI) states that
it contains the maximum share of the cooperating as well as the non-cooperating Chinese exporters within the
PRC-wide entity. We further note that the United States has provided additional exhibits setting out its
approach for isolating the share of the PRC-wide entity representing only the cooperating Chinese exporters
within the PRC-wide entity, and has suggested that Exhibit USA-54 (BCI), to some extent, excludes the shares
of at least certain non-cooperating exporters within the PRC-wide entity. (United States' response to Arbitrator
question No. 61, para. 48; and communication of 11 June 2019, pp. 1-2; Calculated Maximum Share Covered
by the PRC-Wide Entity, (Exhibit USA-56 (BCI)); and Approach for Estimating the Maximum Share of the
PRC-Wide Entity, (Exhibit USA-86)). In its comments on the United States' explanations, China requests that
Exhibits USA-56 (BCI) and USA-86 be "ignored" and that "only the percentages set forth in Exhibit USA-54
should be utilized to calculate the PRC-entity share". (China's communication of 13 June 2019, p. 4). We recall
that we have rejected the United States' proposed counterfactual of distinguishing between cooperating and
non-cooperating Chinese exporters within the PRC-wide entity and reducing the WTO-inconsistent PRC-wide
duty rates only for the cooperating Chinese exporters. Instead we have determined that the WTO-inconsistent
PRC-wide duty rates should be reduced for all Chinese exporters within the PRC-wide entity. Bearing this, as
well as China's comments, in mind, we use only the maximum shares of the PRC-wide entity set forth in
Exhibit USA-54 (BCI).
306 Aluminum Extrusions; Bags; Coated Paper; OCTG; OTR Tires; PET Film; Solar Panels; Wood
Flooring; Copper Pipe and Tube; Iron Pipe Fittings; Passenger Vehicle and Light Truck Tires; Sheet and Strip;
Steel Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel Products; Steel Standard, Line, and Pressure
Pipe; and Steel Wire Rod. (China's communication of 13 June 2019, p. 4). We note that China submits that
Exhibit USA-54 (BCI) does not contain information concerning Aluminum Extrusions, and that the Arbitrator
should therefore use the average of the maximum shares of the PRC-wide entity provided by the United States
for the remaining anti-dumping orders, calculated by China to be 44%. We further note that while Exhibit
USA-54 (BCI) does not contain the maximum share of the PRC-wide entity for Aluminum Extrusions, the
United States has explained that the maximum share of the PRC-wide entity is [[***]]% for Aluminum
Extrusions. (United States' response to Arbitrator question No. 62, para. 70). Generally, China does not object
to the use of the maximum shares of the PRC-wide entity provided by the United States, where such shares
are above [[***]]%. (China's comments on the United States' response to Arbitrator question No. 61,
paras. 40-41; and communication of 13 June 2019, p. 4). We therefore understand China's comment regarding
Aluminum Extrusions to be an inadvertent error, and consider it appropriate to use [[***]]% as the maximum
share of the PRC-wide entity in Aluminum Extrusions.
307 China's comments on the United States' response to Arbitrator question No. 61, para. 35.
308 See Annex E-2, which reports the shares of Chinese exporters subject to the PRC-wide duty rate in
the year prior to the imposition of the anti-dumping orders and the data sources used to estimate these
shares.
309 Diamond Sawblades; Furniture; Ribbons; Shrimp; Steel Cylinders; and Residential Washers.
310 Calculated Maximum Share Covered by the PRC-Wide Entity, (Exhibit USA-54 (BCI)).
311 United States' response to Arbitrator question No. 61(b), para. 49.
312 China's comments on the United States' response to Arbitrator question No. 61, paras. 40-41; and
Data Required for Implementing the Armington Model Under Two Steps, (Exhibit CHN-55 (BCI)).

from China compiled by US Customs shows that some Chinese companies within the PRC-wide entity
had shipment values of above [[***]] US dollars to the United States in the year prior to the
imposition of the anti -dumping orders.313 Rather than using an average pertaining to ot her anti-
dumping orders, as China proposes, we consider it more appropriate to approximate, for each of the
six anti-dumping orders, the share of US imports from China covered by the PRC-wide entity. More
particularly, we identify the names of all the Chin ese exporters outside the PRC -wide entity314 and
compare these with the names and shipment values of all the Chinese companies that exported to
the United States in the year prior to the imposition of the anti -dumping orders.315 By subtracting
the combined value of US shipments from the Chinese exporters outside the PRC -wide entity from
the total value of US imports from China, we determine the share covered by the PRC -wide entity
in the year prior to the imposition of the anti-dumping orders.316
7.26. To determine the value of US imports from the Chinese exporters subject to the
WTO-inconsistent WA-T duty rates in the three anti -dumping orders where the USDOC used this
methodology317, we first determine the value of US imports from the Chinese exporters outside the
PRC-wide entity by subtracting the share of the PRC-wide entity, determined in accordance with the
preceding paragraph, from the total value of US imports from China in the year prior to the
imposition of the anti -dumping orders. We then identify the names of all the exporters subject to
the WTO-inconsistent WA-T duty rates318 and the names of all other Chinese exporters outside the
PRC-wide entity 319 and compare these with the names and shipment values of all the Chinese
companies that exported to the United States in the year prior to the imposition of the anti-dumping
orders.320 Finally, we apply the relative share of the exporters subject to the WTO-inconsistent WA-T
duty rates to the value of US imports from the Chinese exporters outside the PRC -wide entity to
obtain the value of US imports from the Chinese exporters subject to the WTO -inconsistent WA-T
duty rates.321
7.27. Lastly, we determine the value of US imports from the remaining Chinese exporters. For the
22 anti-dumping orders that concern only the USDOC's use of the WTO -inconsistent Single Rate
Presumption322, we subtract the share of the PRC -wide entity, determined in accordance with
paragraph 7.25 above, from the total value of US imports from China in the year prior to the

313 The analysis is based on company-specific trade data on US imports from China compiled by US
Customs. (Excel File with Import Data in the Year Preceding the Imposition of Anti-Dumping Duties, (Exhibit
USA-94 (BCI))).
314 See Annex E-3, which reports the names of all the Chinese exporters outside the PRC-wide entity
and the data sources used to identify these exporters.
315 Excel File with Import Data in the Year Preceding the Imposition of Anti-Dumping Duties, (Exhibit
USA-94 (BCI)). When comparing the names and shipment values of the Chinese exporters outside the PRC-
wide entity, we have disregarded obvious typos in the company-specific data compiled by US Customs as well
as discrepancies between frequently used abbreviations such as Co., Ltd., etc.
316 See Annex E-2, which reports the shares of Chinese exporters subject to the PRC-wide duty rate in
the year prior to the imposition of the anti-dumping orders as well as the data sources used to estimate these
shares.
317 Coated Paper; OCTG; and Steel Cylinders.
318 As explained in section 5.2.1 above, in Coated Paper, the WTO-inconsistent WA-T duty rate was
assigned to APP-China and to the Chinese exporters that passed the Separate Rate Test but were not chosen
for individual examination; in OCTG, the WTO-inconsistent WA-T duty rate was assigned to TPCO and to the
Chinese exporters that passed the Separate Rate Test but were not chosen for individual examination; and in
Steel Cylinders, the WTO-inconsistent WA-T duty rate was assigned to the Chinese exporters that passed the
Separate Rate Test but were not chosen for individual examination. (See Annex E-4, which reports the names
of the Chinese exporters subject to the WA-T duty rates as well as the data sources used to identify these
exporters).
319 See Annex E-4, which reports the names of all other Chinese exporters outside the PRC-wide entity
as well as the data sources used to identify these exporters.
320 Excel File with Import Data in the Year Preceding the Imposition of Anti-Dumping Duties, (Exhibit
USA-94 (BCI)). When comparing the names and shipment values of the Chinese exporters subject to the WA-T
duty rates and the remaining Chinese exporters outside the PRC-wide entity, we have disregarded obvious
typos in the company-specific data compiled by US Customs as well as discrepancies between frequently used
abbreviations such as Co., Ltd., etc.
321 See Annex E-2, which reports the shares of the Chinese exporters subject to the WA-T duty rates in
the year prior to the imposition of the anti-dumping orders as well as the data sources used to estimate these
shares.
322 Aluminum Extrusions; Bags; Diamond Sawblades; Furniture; OTR Tires; PET Film; Ribbons; Shrimp;
Solar Panels; Wood Flooring; Copper Pipe and Tube; Iron Pipe Fittings; Passenger Vehicle and Light Truck
Tires; Residential Washers; Sheet and Strip; Steel Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel
Products; Steel Standard, Line, and Pressure Pipe; and Steel Wire Rod.

imposition of the anti -dumping orders.323 For the three anti -dumping orders that concern the
USDOC's use of the WTO -inconsistent WA -T methodology with zeroing as well as the
WTO-inconsistent Single Rate Presumption324, we apply the relative share of the remaining Chinese
exporters, determined in accordance with paragraph 7.26 above, to the valu e of US imports from
the Chinese exporters outside the PRC -wide entity in order to obtain the value of US imports from
the remaining Chinese exporters.325
7.28. With respect to the value of US imports from China in 2017 , the United States has
provided US Customs data.326 China criticizes the data provided by the United States on the grounds
that the data sources are questionable and not verifiable. 327 As was the case for the value of US
shipments in 2017, China does not propose any data for the value of US imports from China in 2017,
instead proposing to use inflation-adjusted values from the year prior to the imposition of the
anti-dumping orders.328
7.29. As explained above, we do not consider it appropriate to use inflation -adjusted values from
the year prior to the imposition of the anti-dumping orders, as China proposes. For the value of US
imports from China in 2017, we therefore only have the data on record that is provided by
the United States.329 Although China criticizes this data for not being publicly available or
verifiable330, we note that China has not provided evidence that this data is unreliable, nor suggested
alternative data. For this reason, we consider the data provided by the United States to be the best
available. We therefore use the product-specific, confidential trade data reported by US Customs for
all anti-dumping orders at issue.331
7.1.1.3 Value of US imports from the rest of the world
7.30. To implement the Armington model under the first step , we need data on the value of US
imports from the rest of the world in the year prior to the imposition of the anti -dumping orders to
construct the total value of the US market and the market shares in that year. To implement the
Armington model under the second step, we need data on the value of US imports from the rest of
the world in 2017 in order to construct the total value of the US market in 2017. Below, we explain
how we obtained each of these data inputs.
7.31. With respect to the value of US imports from the rest of the world in the year prior to
the imposition of the anti -dumping orders, the United States proposes to use aggregate data
reported by the US Census Bureau based on the reference HTS codes US Customs used to identify
shipments that may be su bject to anti -dumping duties. 332 China proposes to use information
available in USITC investigation reports.333 When such information is not available for the relevant

323 See Annex E-2, which reports the shares of the remaining Chinese exporters in the year prior to the
imposition of the anti-dumping orders as well as the data sources used to estimate these shares.
324 Coated Paper; OCTG; and Steel Cylinders.
325 See Annex E-2, which reports the shares of the remaining Chinese exporters in the year prior to the
imposition of the anti-dumping orders as well as the data sources used to estimate these shares.
326 Updated Table of US Customs Data on US Imports from China, (Exhibit USA-30 (BCI)); and
United States' response to the Arbitrator question No. 62, para. 67.
327 China contends that the United States fails to provide the back-up data on the US imports for
individual Chinese exporters in 2017 in order to verify its calculation. (China's written submission, para. 245).
328 China's response to Arbitrator question No. 65, paras. 53-55; and comments on the United States'
response to Arbitrator question No. 65, para. 86; Data Required for Implementing the Armington Model Under
Two Steps, (Exhibit CHN-55 (BCI)); and Supporting Documents for Data Required for Implementing the
Armington Model Under Two Steps, (Exhibit CHN-56 (BCI)). For Residential Washers, China submits an
estimate of the 2017 total market value based on data from AHAM. (Supporting Documents for Data Required
for Implementing the Armington Model Under Two Steps, (Exhibit CHN-56 (BCI))).
329 Updated Table of US Customs Data on US Imports from China, (Exhibit USA-30 (BCI)).
330 China's written submission, paras. 182-183.
331 See Annex E-8, which reports the values of US imports from China in 2017 and the data sources
used to estimate these values.
332 Table of US Imports from China, World, and Rest of the World in Selected Years, (Exhibit USA-57).
The United States explains that the HTS aggregated data may overstate the value of shipments subject to anti-
dumping duties, since some of these shipments may not actually be subject to anti-dumping duties.
(United States' response to Arbitrator question No. 71(a), para. 142).
333 China's comments on the United States' response to Arbitrator question No. 65, paras. 77-78; and
Data Required for Implementing the Armington Model Under Two Steps, (Exhibit CHN-55 (BCI)).

calendar year, or is confidential, China agrees to use the HTS aggregated data from the US Census
Bureau proposed by the United States.334
7.32. For consistency, we follow the same approach that we followed for data on the value of US
imports from China, and rely on the relevant USITC investigation reports to obtain information for
the nine anti-dumping orders at issue where such information is available. 335 For five of the
anti-dumping orders at issue336, the value of US imports from the rest of the world in the year prior
to the imposition of the anti -dumping orders is not directly available from the USITC reports, and
we construct these values by subtracting the value of US imports from China, obtained from US
Customs data, from the total value of US imports published in the USITC investigation reports. 337
For the remaining 11 anti-dumping orders at issue 338, the information on the total value of US
imports and the value of US imports from the rest of the world is not available in the relevant USITC
reports for the full calendar year or not available at all for confidentiality reasons, and we therefore
use the value of US imports from the rest of the world based on aggregated trade data reported by
the US Census Bureau based on the reference HTS codes used by US Customs to identify shipments
that may be subject to anti-dumping duties.339
7.33. With respect to the value of US imports from the rest of the world in 2017 , the
United States proposes to use aggregated trade data reported by the US Census Bureau based on
the reference H TS codes used by US Customs to identify shipments that may be subject to
anti-dumping duties.340 By subtracting the value of shipments that may be subject to anti-dumping
duties from the total value of US imports, the United States approximates the value of US imports
from the rest of the world. 341 China rejects the data provided by the United States on the grounds
that the data sources are questionable and that the assumptions made by the United States are
arbitrary and not verifiable.342 As was the case for the value of US shipments in 2017 and the value
of US imports from China in 2017, China has not submitted any data on the value of US imports
from the rest of the world in 2017 and instea d proposes to use the inflation-adjusted values from
the year prior to the imposition of the anti-dumping orders.343
7.34. As explained above, we do not consider it appropriate to use inflation -adjusted values from
the year prior to the imposition of the anti-dumping orders, as proposed by China. For the value of
US imports from the rest of the world in 2017, we therefore only have the data on record that is
provided by the United States.344 Although China criticizes this data for not being publicly available

334 Data Required for Implementing the Armington Model Under Two Steps, (Exhibit CHN-55 (BCI)); and
Table of US Imports from China, World, and Rest of the World in Selected Years, (Exhibit USA-57). We note
that for some anti-dumping orders, China estimates the value of the US imports from the rest of the world by
subtracting the value of US imports from China, based on US Census data, from the total value of US imports
reported in the USITC report. (Data Required for Implementing the Armington Model Under Two Steps, (Exhibit
CHN-55 (BCI))).
335 Aluminum Extrusions; Coated Paper; OTR Tires; Wood Flooring; Copper Pipe and Tube; Passenger
Vehicle and Light Truck Tires; Steel Flat Products; Steel Pipe; and Steel Standard, Line, and Pressure Pipe.
(See Annex E-1, which reports the values of US imports from the rest of the world in the year prior to the
imposition of the anti-dumping orders and the data sources used to estimate these values).
336 Bags; Furniture; Ribbons; Steel Nails; and Steel Products.
337 See Annex E-1, which reports the values of US imports from the rest of the world in the year prior to
the imposition of the anti-dumping orders and the data sources used to estimate these values.
338 Diamond Sawblades; OCTG; PET Film; Iron Pipe Fittings; Shrimp; Solar Panels; Steel Cylinders;
Residential Washers; Sheet and Strip; Steel Line Pipe; and Steel Wire Rod.
339 See Annex E-1, which reports the values of US imports from the rest of the world in the year prior to
the imposition of the anti-dumping orders and the data sources used to estimate these values.
340 Table of US Imports from China, World, and Rest of the World in Selected Years, (Exhibit USA-57).
341 Appendices with Domestic Shipment and Import Data, Elasticity Parameters, and Model Results for
Each Modelling Scenario, sourced from the USITC, (Exhibit USA-13 (BCI)); Revised Appendices with Domestic
Shipment and Import Data, Elasticity Parameters, and Model Results for Each Modelling Scenario, sourced from
the USITC, (Exhibit USA-31 (BCI)); and Table of US Imports from China, World, and Rest of the World in
Selected Years, (Exhibit USA-57).
342 China's written submission, paras. 182-183.
343 China's response to Arbitrator question No. 65, paras. 53-55; and comments on the United States'
response to Arbitrator question No. 65, para. 86; Data Required for Implementing the Armington Model Under
Two Steps, (Exhibit CHN-55 (BCI)); and Supporting Documents for Data Required for Implementing the
Armington Model Under Two Steps, (Exhibit CHN-56 (BCI)). For Residential Washers, China submits an
estimate of the 2017 total market value based on data from AHAM. (Supporting Documents for Data Required
for Implementing the Armington Model Under Two Steps, (Exhibit CHN-56 (BCI))).
344 Updated Table of US Customs Data on US Imports from China, (Exhibit USA-30 (BCI)).

or verifiable345, China has not provided evidence demonstrating that this data is unreliable, nor
suggested alternative data. For this reason, we consider the data provided by the United States to
be the best available. We therefore use the value of US imports from the rest of the world in 2017
based on HTS aggregated data reported by the US Census Bureau.346
7.1.2 Elasticities
7.35. Elasticity measures how responsive an economic variable is to a change in another variable.
The elasticity value is not directly observable and can either be estimated empirically or inferred
from existing estimates reported in the literature. As explained above, we need the total demand
elasticity, the elasticity of substitution, and the supply elasticities for each anti -dumping order at
issue. For supply elasticities, we need the domestic supply elasticity as well as the supply elasticities
for different sources of US imports.
7.36. With respect to the total demand elasticity, the elasticity of substitution , and the
domestic supply elasticity , the United States proposes to use, for each anti -dumping order at
issue, the midpoint value of the range of elasticity estimates published in the relevant USITC
investigation reports. 347 Rather than using the midpoint value, China proposes to apply the
Armington model using the highest and lowest of the elasticity estimates published in the USITC
investigation reports , and use the simple average of the two result s as the estimated level of
nullification or impairment.348 However, China has not pr ovided any evidence to demonstrate that
this would be a more appropriate way to apply the Armington model. 349 Further, China argues that
the elasticities proposed by the United States are old and thus inappropriate to use when applying
the Armington model to the 2017 US market under the second step. 350 China has, however, not
provided any evidence suggesting that these elasticity values are inappropriate, nor has it presented
alternative elasticity estimates. We therefore use, for each anti-dumping order at issue, the midpoint
value of the elasticity estimates published in the relevant USITC reports when applying the
Armington model under both the first and the second step.351
7.37. With respect to the supply elasticities for different sources of US imports , the
United States proposes to use the same value of 10 as the supply elasticity for (i) US imports from
the Chinese exporters subject to the WTO -inconsistent PRC-wide duty rates, (ii) US imports from
the remaining Chinese exporters, and (iii) US imports from the rest of the world.352 The United States
does not explicitly propose a value as the supply elasticity for US imports from the Chinese exporters
subject to the WTO-inconsistent WA-T duty rates, which we need for the three anti-dumping orders
that concern the USDOC's use of the WTO -inconsistent WA-T methodology with zeroing as well as
the WTO-inconsistent Single Rate Presumption. 353 Although China rejects the notion of using the
exact same value as the supply elasticity for all varieties of US imports, it has not prov ided any
alternative estimates.354 We further note that, as pointed out by t he United States, import supply

345 China's written submission, paras. 182-183.
346 See Annex E-8, which reports the values of US imports from the rest of the world in 2017 and the
data sources used to estimate these values. We note that for Aluminum Extrusions, the United States provides
two sets of data on the value of imports, one pertaining to the HTS reference codes active in 2011, the initial
period following the imposition of the anti-dumping order, and the other pertaining to the HTS reference codes
active in 2017. According to the United States, there were no expansions of the product scope for Aluminum
Extrusions between the imposition of the anti-dumping order and 2017. (United States' response to Arbitrator
question No. 62, paras. 59-64). For consistency, we use the data pertaining to the HTS reference codes active
in 2011 because this value is closer to the actual value of US imports subject to anti-dumping duties reported
by US Customs.
347 United States' written submission, paras. 82-84; and Table of Elasticities, (Exhibit USA-16).
348 China's response to Arbitrator question No. 65, para. 56.
349 We further note that the approach suggested by China would result in a lower estimated level of
nullification or impairment compared with the approach of using the midpoint value of the elasticity estimates
published in the relevant USITC reports.
350 China's opening statement at the meeting of the Arbitrator, para. 58.
351 See Annex E-5, which reports the values for the total demand elasticity, the elasticity of substitution,
and the domestic supply elasticity and as well as the data sources used to estimate these values.
352 Appendices with Domestic Shipment and Import Data, Elasticity Parameters, and Model Results for
Each Modelling Scenario, sourced from the USITC, (Exhibit USA-13 (BCI); and Revised Appendices with
Domestic Shipment and Import Data, Elasticity Parameters, and Model Results for Each Modelling Scenario,
sourced from the USITC, (Exhibit USA-31 (BCI)).
353 Coated Paper; OCTG; and Steel Cylinders.
354 China's written submission, paras. 176-177.

elasticities are generally more elastic than domestic supply elasticities355 and it is common practice
in applied economic modelling to assign the value of parameters for which formal estimates are not
available when those parameters, such as the supply elasticities, are not central to the analysis. 356
In light of this, we consider it appropriate to use the value of 10 as the supply elasticity for all the
varieties of US imports. We use the supply elasticity of 10 when applying the Armington model under
both the first and the second step.
7.1.3 Anti-dumping duty rates
7.38. To implement the Armington model under the first step, we need the actual duty rates
assigned to Chinese exporters. To implement the Armington model under the second step, we also
need the counterfactual duty rates, which replace the WTO-inconsistent duty rates.
7.39. With respect to the actual duty rates, the United States has provided data based on publicly
available USDOC records from the relevant anti-dumping investigations and administrative reviews.
More particularly, the United States has provided the PRC-wide duty rates assigned to the Chinese
exporters within the PR C-wide entity and the duty rates assigned to all other Chinese exporters
outside the PRC-wide entity.357 Based on the latter duty rates, the United States has also provided
a simple average of the duty rates assigned to the Chinese exporters outside the PRC-wide entity.358
China has not objected to this data.
7.40. For the 22 anti-dumping orders that concern only the USDOC's use of the WTO-inconsistent
Single Rate Presumption 359, we use the data on the PRC -wide duty rates, provided by the
United States, for the Chinese exporters within the PRC-wide entity, and we use the simple average
of the duty rates assigned to Chinese exporters outside the PRC -wide entity, provided by the
United States, for the remaining Chinese exporters.360
7.41. For the three anti -dumping orders that co ncern the USDOC's use of the WTO -inconsistent
WA-T methodology with zeroing as well as the WTO -inconsistent Single Rate Presumption 361, we
also use the data on the PRC -wide duty rates, provided by the United States, for the Chinese
exporters within the PRC-wide entity.362 We use the data on the WA-T duty rates, provided by the
United States, for the Chinese exporters subject to these WTO-inconsistent WA-T duty rates.363 For

355 United States' response to Arbitrator question No. 46(a), para. 185.
356 In addition, as demonstrated by the United States, applying the Armington model using the same
values for the import supply elasticities as those used for the domestic supply elasticity, rather than the value
of 10, would result in a lower estimated level of nullification or impairment. (Tables Presenting Armington
Model with Import Supply Elasticity at 10, Inputs for the Armington Model, Armington Model with Import
Supply Elasticity Equal to US Domestic Supply Elasticity, and Armington Model with Infinite Import Supply
Elasticity, (Exhibit USA-52 (BCI))).
357 Anti-Dumping Duty Rates Assigned by the USDOC to Chinese Firms Subject to Anti-Dumping Duties,
(Exhibit USA-77 (BCI)); and Excel File with Simple Average of Duty Rates for Chinese Exporters Outside the
PRC-Wide Entity, (Exhibit USA-92 (BCI)).
358 Excel File with Simple Average of Duty Rates for Chinese Exporters Outside the PRC-Wide Entity,
(Exhibit USA-92 (BCI)).
359 Aluminum Extrusions; Bags; Diamond Sawblades; Furniture; OTR Tires; PET Film; Ribbons; Shrimp;
Solar Panels; Wood Flooring; Copper Pipe and Tube; Iron Pipe Fittings; Passenger Vehicle and Light Truck
Tires; Residential Washers; Sheet and Strip; Steel Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel
Products; Steel Standard, Line, and Pressure Pipe; and Steel Wire Rod.
360 Anti-Dumping Duty Rates Assigned by the USDOC to Chinese Firms Subject to Anti-Dumping Duties,
(Exhibit USA-77 (BCI)); and Excel File with Simple Average of Duty Rates for Chinese Exporters Outside the
PRC-Wide Entity, (Exhibit USA-92 (BCI)). See also Annex E-6. For two anti-dumping orders, Aluminum
Extrusions and Sheet and Strip, the relevant data was missing from Exhibits USA-77 (BCI) and USA-92 (BCI).
We have obtained the relevant data from publicly available USDOC records from the relevant anti-dumping
investigations and administrative reviews. More particularly, we use the PRC-wide duty rate assigned in the
most recent 2015-2016 administrative review for Aluminum Extrusions and the PRC-wide duty rate assigned in
the original investigation for Sheet and Strip. For the remaining Chinese exporters, we have, for both anti-
dumping orders, calculated the simple average using the approach that the United States followed in
Exhibits USA-77 (BCI) and USA-92 (BCI). (See Annex E-7).
361 Coated Paper; OCTG; and Steel Cylinders.
362 Anti-Dumping Duty Rates Assigned by the USDOC to Chinese Firms Subject to Anti-Dumping Duties,
(Exhibit USA-77 (BCI)); and Excel File with Simple Average of Duty Rates for Chinese Exporters Outside the
PRC-Wide Entity, (Exhibit USA-92 (BCI)).
363 As explained in section 5.2.1 above, in Coated Paper, the WTO-inconsistent WA-T duty rate was
assigned to APP-China and to the Chinese exporters that passed the Separate Rate Test but were not chosen

the remaining Chinese exporters, we recalculate the simple average of the duty rates assig ned to
Chinese exporters outside the PRC -wide entity, provided by the United States, in order to reflect
only the duty rates of exporters outside the PRC -wide entity other than those subject to the WTO -
inconsistent WA-T duty rates.364
7.42. With respect to the counterfactual duty rates, we use the duty rates determined in section
5.3 above. More particularly, for the 22 anti-dumping orders that concern only the USDOC's use of
the WTO-inconsistent Single Rate Presumption365, we use a 0.00% counterfactual duty rate for the
Chinese exporters subject to the WTO -inconsistent PRC-wide duty rates. For Coated Paper, which
concerns the USDOC's use of the WTO -inconsistent WA-T methodology with zeroing as well as the
WTO-inconsistent Single Rate Presumption, we use a 0.00% duty rate as the counterfactual duty
rate for the Chinese exporters subject to the WA -T duty rate, namely APP-China and the exporters
that passed the Separate Rate Test but were not chosen for individual examination, and we use a
0.00% counterfactual duty rate for the Chinese exporters subject to the WTO-inconsistent PRC-wide
duty rate. For OCTG, which concerns the USDOC's use of the WTO-inconsistent WA-T methodology
with zeroing as well as the WTO-inconsistent Single Rate Presumption, we use a [[***]]% duty rate
as the counterfactual duty rate for the Chinese exporters subject to the WA -T duty rate, n amely
TPCO and the exporters that passed the Separate Rate Test but were not chosen for individual
examination, and we use a 0.00% counterfactual duty rate for the Chinese exporters subject to the
WTO-inconsistent PRC-wide duty rate. For Steel Cylinders, which concerns the USDOC's use of the
WTO-inconsistent WA -T methodology with zeroing as well as the WTO -inconsistent Single Rate
Presumption, we use a 0.00% duty rate as the counterfactual duty rate for the Chinese exporters
subject to the WA-T duty rate, namely the exporters that passed the Separate Rate Test but were
not chosen for individual examination, and we use a 0.00% counterfactual duty rate for the Chinese
exporters subject to the WTO-inconsistent PRC-wide duty rate.
7.2 Implementation of the Armington model under the two steps
7.43. Having identified the required data inputs, we proceed to implement the Armington model
under the two steps.366
7.44. As the first step, we apply the Armington model to the US market as it existed prior to the
imposition of the anti-dumping orders in order to simulate, for each anti-dumping order, the impact
of imposing the relevant anti-dumping duties on the market shares of the Chinese exporters (both
the Chinese exporters subject to the WTO -inconsistent anti -dumping duties and the rem aining
Chinese exporters), the exporters from the rest of the world, and the US producers. 367 We then
apply the market shares of the Chinese exporters simulated under the first step to the actual 2017
total value of the US market in order to obtain the simul ated 2017 total value of US imports from
China.
7.45. As the second step, we apply the Armington model to the actual 2017 US market with the
market shares simulated under the first step in order to simulate, for each anti-dumping order, the
impact of reducing th e WTO-inconsistent anti -dumping duties from the actual duty rates to the
counterfactual duty rates on the value of US imports from China (both the Chinese exporters subject
to the WTO-inconsistent anti-dumping duties and the remaining Chinese exporters), t he exporters

for individual examination; in Steel Cylinders, the WTO-inconsistent WA-T duty rate was assigned to the
Chinese exporters that passed the Separate Rate Test but were not chosen for individual examination; in
OCTG, the WTO-inconsistent WA-T duty rate was assigned to TPCO and the Chinese exporters that passed the
separate rate test but were not chosen for individual examination. Based on publicly available USDOC records
of the relevant anti-dumping investigations and administrative reviews, we have identified all the Chinese
exporters that passed the Separate Rate Test but were not chosen for individual examination. (See
Annex E-4).
364 Based on publicly available USDOC records of the relevant anti-dumping investigations and
administrative reviews, we have identified the Chinese exporters that received neither the WTO-inconsistent
PRC-wide duty rate nor the WTO-inconsistent WA-T duty rate in Steel Cylinders and OCTG. In Coated Paper,
there are no such Chinese exporters. (See Annex E-4).
365 Aluminum Extrusions; Bags; Diamond Sawblades; Furniture; OTR Tires; PET Film; Ribbons; Shrimp;
Solar Panels; Wood Flooring; Copper Pipe and Tube; Iron Pipe Fittings; Passenger Vehicle and Light Truck
Tires; Residential Washers; Sheet and Strip; Steel Flat Products; Steel Line Pipe; Steel Nails; Steel Pipe; Steel
Products; Steel Standard, Line, and Pressure Pipe; and Steel Wire Rod.
366 The STATA code (do-file) used to implement the Armington model is reported in Annex E-9. The
results were also replicated using the software Excel and R.
367 These simulated market shares are presented in Annex E-11.

from the rest of the world, and the US producers.368 The value of US imports from China simulated
under the second step corresponds to the counterfactual value of US imports from China.
7.46. We then estimate the level of nullification or impairment concerning the anti-dumping orders
at issue by calculating, for each order, the difference between the 2017 value of US imports from
China, simulated under the first step, and the counterfactual value of US imports from China,
simulated under the second step.
7.47. The table below presents the level of nullification or impairment estimated for each anti -
dumping order at issue by applying the Armington model in two steps, as well as the total estimated
level of nullification or impairment.
Table 3: Estimated level of nullification or impairment
Anti-dumping order Level of nullification or impairment
(million USD)
Aluminum Extrusions 498.412
Bags 82.168
Coated Paper 48.036
Diamond Sawblades 17.555
Furniture 438.783
OCTG 447.896
OTR Tires 46.656
PET Film 20.005
Ribbons 7.319
Shrimp 126.215
Solar Panels 714.605
Steel Cylinders 5.608
Wood Flooring 76.192
Copper Pipe and Tube 16.567
Iron Pipe Fittings 28.380
Passenger Vehicle and Light Truck Tires 45.075
Residential Washers 85.023
Sheet and Strip 30.167
Steel Flat Products 321.144
Steel Line Pipe 19.719
Steel Nails 24.652
Steel Pipe 90.033
Steel Products 311.226
Steel Standard, Line, and Pressure Pipe 72.810
Steel Wire Rod 4.88
Total level of nullification or impairment 3,579.128
8 CONCLUSION
8.1. For the reasons set out above, we determine that the level of nullification or impairment of
benefits accruing to China as a result of the WTO -inconsistent methodologies used by the
United States in anti-dumping proceedings concerning products imported from China is 3,579.128
million USD per annum. Therefore, in accordance with Article 22.4 of the DSU, China may request

368 For a similar approach, see Decision by the Arbitrator, US – Washing Machines (Article 22.6 – US),
paras. 3.114-3.119.

authorization from the DSB to suspend concessions or other obligations at a le vel not exceeding
3,579.128 million USD per annum.