KOREA – SUNSET REVIEW OF ANTI-DUMPING DUTIES ON STAINLESS STEEL BARS REQUEST FOR THE ESTABLISHMENT OF A PANEL BY JAPAN
Document: REQUEST FOR THE ESTABLISHMENT OF A PANEL
Date: 14 September 2018
Document codes: WT/DS553/2
Complainant: Japan
Respondent: South Korea
Third parties: China, EU, India, Kazakhstan, Russia, Taiwan, U.S.
Dispute stage: Panel
Agreements cited: Art. 11.3, 11.4, 6.8, Annex II, 6.5, 6.5.1, 6.9, 12.3, 12.2, 12.2.2  Anti-dumping

KOREA – SUNSET REVIEW OF ANTI-DUMPING DUTIES ON STAINLESS STEEL BARS
REQUEST FOR THE ESTABLISHMENT OF A PANEL BY JAPAN
The following communication, dated 13 September 2018 , from the delegation of Japan to the
Chairperson of the Dispute Settlement Body, is circulated pursuant to Article 6.2 of the DSU.

My authorities have instructed me to request the establishment of a panel with respect to the
measures by the Republic of Korea ( "Korea") continuing the impos ition of anti -dumping duties
on stainless steel bars ( "SSB") imported from Japan. Japan submits th is request pursuant to
Articles 4.7 and 6 of the Understanding on Rules and Procedures Governing the Settlement of
Disputes ("DSU"), Article XXIII of the General Agreement on Tariffs and Trade 1994 ("GATT 1994"),
and Article 17.4 of the Agreement on Implementation of Article VI of the General Agreement on
Tariffs and Trade 1994 ("AD Agreement").

On 18 June 2018, Japan requested consult ations with Korea.1 Japan and Korea held consultations
on 13 August 2018, with a view to reaching a mutually satisfactory solution. Unfortunately, the
consultations failed to settle the dispute.

Korea's measures to continue the imposition of anti -dumping duties on stainless steel bars from
Japan is set forth in the Korea Trade Commission 's ("KTC") "Resolution of Final Determination on
the Sunset Review of Anti -Dumping Duties on Stainless Steel Bars from Japan, India and Spain "
("Resolution of Final Determination") and in the Office of Trade Investigation's "Final Report on the
Sunset Review of Anti -Dumping Duties on Stainless Steel Bars from Japan, India and Spain "
("Final Report") with respect to Investigation Trade Remedy 23-2016-3, both dated 20 March 2017,
including any and all annexes and amendments thereto.2

Japan considers that these measures are inconsistent with Korea 's obligations under the following
provisions of the AD Agreement:

1. Article 11.3 of the AD Agreement, because Korea failed to pro perly determine, as the basis to
continue the imposition of antidumping duties on the imports from Japan, that the expiry of the
duties would be likely to lead to continuation or recurrence of injury. Specifically, Korea failed
to demonstrate the nexus between the expiry of the duties and a continuation or recurrence of
injury and to comply with the fundamental requirement that such determination shall rest on a
sufficient factual basis and reasoned and adequate conclusions, due to, inter alia, the following
reasons:

(a) Korea's determination that the expiry of the duties would be likely to lead to
continuation or recurrence of injury was based on its cumulative assessment of
the effects of the imports from Japan, India and Spain. However, such cumulative

1 WT/DS553/1, circulated on 21 June 2018.
2 This determination in the third sunset review is identified in Korea 's notification G/ADP/ N/300/KOR
dated 17 August 2017.
For the sake of completeness, the measures include the Office of Trade Investigation's "Preliminary Report
regarding the Sunset Review of Anti-dumping Duties on Japanese, Indian, and Spanish Stainless Steel Bar
(Amended after Public Hearing)" ("Preliminary Report") dated 1 February 2017, to the extent it is referred to in
paragraph 4 below.

assessment was not bas ed on positive evidence and an objective examination.
For example, Korea cumulatively assessed the effect of the imports from Japan,
India and Spain without properly examining whether the conditions of competition
between the imported products, as well as the conditions of competition between
the imports from Japan and the like domestic products, are such that the imports
from Japan, together with the imports from India and Spain, would cause injury
to the domestic industry. It did so even though the vast majority of the models,
types or grades of SSB imported from Japan during the period of review were
distinct from those of the imports from India and of the like domestic products;
(b) When it determined that the expiry of the duties would be likely to l ead to
continuation or recurrence of injury to the domestic industry, Korea improperly
attributed the likelihood of injury to the imports from Japan, even though Korea
acknowledged that the profitability of the domestic industry had not sufficiently
recovered during the period of review due to factors other than the imports under
review. Such factors include (i) the growing volume and market share of imports
of SSB from third countries, such as China, Taiwan and Italy; (ii) the decline of
the sales price o f such imports; (iii) the decline of material costs; (iv) the
continuing trend of slow growth in domestic demand; and (v) the continuing trend
of decrease in the volume of exports by the domestic industry and the ratio of
the export volume to the total volume of sales by the domestic industry.
(c) Korea's determination that the expiry of the duties would be likely to lead to
continuation or recurrence of injury relied on, among others, the finding that
Japan's SSB sector had sufficient additional product ion capacity for exports. In
making this finding, Korea, as stated in paragraph 2 below, declined to accept
and properly consider the actual production capacity data submitted by each of
the Japanese exporters, and instead adopted information from a secon dary
source that was both inaccurate and irrelevant when calculating the production
capacity of Japan 's SSB sector. As a result, Korea 's finding that the Japanese
producers had the capability to increase their production and exports to Korea
was neither based on positive evidence nor on an objective examination; and
(d) Korea's determination that the expiry of the duties would be likely to lead to
continuation or recurrence of injury relied on, among others, the finding that the
expiry of the duties would lead to the increase of the imports from Japan under
review and that such imports would affect prices of SSB produced by the domestic
industry. However, Korea failed to show any plausible reason why imports from
Japan of SSB of the models, types or grades which are the same as or comparable
with those imported from other countries or produced by the domestic industry
would increase after the expiry of the duties. As a result, Korea failed to
demonstrate, based on positive evidence and an objective examinat ion, (i)
whether and how the expiry of the duties would lead to the alleged increase in
imports of SSB from Japan and the alleged decrease in prices of SSB imported
from Japan, and (ii) whether and how such alleged factors could affect, together
with imports of SSB from other countries, SSB produced by the domestic industry.
In light of, in particular, but not limited to, reasons (a) to (d) above, the measures at issue are
also inconsistent with Korea's obligations under Article VI:6(a) of the GATT 1994, because Korea
is levying the antidumping duties without establishing that the effect of the dumping is such as
to cause or threaten material injury to an established domestic industry.

2. Articles 11.4 and 6.8 and paragraphs 3 and 7 of Annex II of the AD Agreement, because, to the
extent that Korea used third party data regarding the production capacity of Japanese exporters
and thereby resorted to facts available, inter alia:
(a) Korea failed to take into account the information regarding actual production
capacity which each of the Japanese exporters submitted, even though such
information was verifiable, was appropriately submitted so that it could be used
in the investigation without undue difficulties and was supplied in a timely
fashion; and

(b) Korea adopted information from a secondary source regarding the production
capacity of Japanese exporters without special circumspection. For example,
Korea did not examine the accuracy of the information from the secondary source
by comparing it with the information obtained from the Japanese exporters;
3. Articles 11.4, 6.5 and 6.5.1 of the AD Agreement, because Korea, inter alia, (a) treated the
information provided by the applicants as confidential information wit hout good cause shown,
(b) failed to require the applicants to furnish non-confidential summaries of their submissions,
questionnaire responses, and amendments thereof, and (c) irrespective of whether such
summaries have been provided, would also have fail ed to require that such summaries be in
sufficient detail to permit a reasonable understanding of the substance of the information
submitted in confidence;

4. Articles 11.4 and 6.9 of the AD Agreement, because Korea failed to inform all interested parties
of the essential facts under consideration which formed the basis for the decision to extend the
anti-dumping duties. Specifically, Korea merely informed the Japanese exporters that the
Resolution of Final Determination and the Final Report, as well as the Preliminary Report in so
far as its contents did not contradict those of the Final Report, constituted such essential facts.
However, none of the Resolution of Final Determination, the Final Report and the Preliminary
Report fully disclosed the essent ial facts underlying the determination of a continuation or
recurrence of dumping and injury, and the determination of the nexus between the expiry of
the duties and the continuation or recurrence of dumping and injury. The essential facts
underlying these two determinations include facts relating to (a) the cumulative assessment of
the effects of the imports under review, (b) additional production capacity, and the capacity for
exports, of foreign producers including those in Japan, (c) the effects of impo rts in terms of
volume and price, (d) factors other than the allegedly dumped imports to which the alleged
recurrence of injury could be attributed, and (e) the effects of the anti -dumping measures
during the period of investigation; and
5. Articles 12.3, 12.2 and 12.2.2 of the AD Agreement, because Korea failed to provide in sufficient
detail the findings and conclusions reached on all issues of fact and law that the investigating
authorities considered material, as well as all relevant information on the matters of fact and
law and reasons which have led to the sunset review determination, including, inter alia, with
respect to:
(a) the determination that a cumulative assessment of the effects of the imports
under review is appropriate in light of the conditions of competition between the
imported products and the conditions of competition between the imported
products and the like domestic products;
(b) the finding of additional production capacity, and the capacity for exports, of
foreign producers including those in Japan;
(c) the finding of a nexus between the expiry of the duties and a continuation or
recurrence of dumping and injury by imports under review, despite
acknowledging the impact of other known factors on the domestic industry; and
(d) any other findings underlying the determination of the continuation or recurrence
of dumping and injury and the determination of the nexus between the expiry of
the duties and a continuation or recurrence of dumping and injury.
As a consequence of the app arent breaches of the AD Agreement described above, Korea 's
continuation of the imposition of antidumping measures on the imports under review is also
inconsistent with Article 1 of the AD Agreement and Article VI of the GATT 1994.

Korea's measures also nullify or impair the benefits accruing to Japan directly or indirectly under the
cited agreements.

Accordingly, Japan respectfully requests that, pursuant to Articles 4.7 and 6 of the DSU, Article XXIII
of the GATT 1994, and Article 17.4 of the AD Agreem ent, the Dispute Settlement Body establish a
panel to examine this matter, with the standard terms of reference as set out in Article 7.1 of the
DSU.