Document: WT/DS405/R Page D-1 ANNEX D ORAL STATEMENTS, OR EXECUTIVE SUMMARIES THEREOF, OF THE THIRD PARTIES Contents Page Annex D-1 Third Party Statement of Brazil D-2
Document codes: WT/DS405/R
Complainant: China
Respondent: EU
Third parties: Australia, Brazil, Colombia, Japan, Turkey, U.S., Vietnam
Dispute stage: Panel
Agreements cited: Art. 9  Anti-dumping  Protocol of AccessionArt. 6.10, 9.2, 9.3, 9.4  Anti-dumpingArt. I, XVI:4, X:3(a)  GATT 1994Art. 2.1, 2.4  Anti-dumpingArt. VI:1  GATT 1994Art. 3.1, 17.6, 3.4, 3.5, 6.1.2, 6.5, 6.5.1, 6.5.2, 6.8, 11.3, 12.2.2, 1, 18.1, 2.2.2, 2.6, 9.1, 3.3, 6.2, 6.4, 6.5.1, 6.5.2, 6.1.1, 6.9, 6.10.2  Anti-dumping

ANNEX D

ORAL STATEMENTS, OR EXECUTIVE SUMMARIES
THEREOF, OF THE THIRD PARTIES

Contents Page
Annex D-1 Third Party Statement of Brazil D-2
Annex D-2 Third Party Statement of Colombia D-5
Annex D-3 Executive Summary of the Third Party Statement of Japan D-8
Annex D-4 Third Party Statement of Turkey D-12
Annex D-5 Executive Summary of th e Third Party Statement of the
United States
D-15

ANNEX D-1

THIRD PARTY STATEMENT OF BRAZIL

1. Brazil would like to begin by expressing its appr eciation for your service in this panel. This
oral statement highlights a few points on the proper legal interpretation of certain provisions of the
GATT 1994 and the Anti–Dumping Agreement (the "ADA"). Brazil recognizes that many of the
issues in this dispute are factual in nature, and fro m the outset Brazil would like to clarify that it takes
no position as to whether the European Union (the "E U") has or has not complied with its obligations
under these two agreements.

2. Today, Brazil will address four issues in addition to those put forward in its written
submission: (i) the relevance of Article 9 of the ADA in the context of China's claims regarding
Article 9(5) of the Basic AD Regulation; (ii) the non-attribution requirement of Article 3.5 of the
ADA; (iii) the publicity obligations under Article 12. 2 of the ADA; and (iv) the relationship between
Articles 11.3 and 3 of the ADA.

3. Brazil would like to start, however, by briefly reiterating one of the points dealt with in its
written submission. Brazil notes that, according to WTO case law, Members are not prevented from
treating multiple companies as a single exporter/producer under Article 6.10 of the ADA, as the Panel
held in Korea – Paper AD Duty .
1 Brazil considers that, for companies operating in non-market
economy ("NME") countries, it would be justified to classify, as a rule, exporters/producers as a
single entity and, as such, subject to a single or, otherwise, common dumping margin determination,
unless they are able to demonstrate their clear inde pendence from the State. The rationale behind this
method of imposing anti-dumping duties is that, in NME countries, it is the State that ultimately
defines or, as a minimum, is able to define individual companies' objectives and commercial
behaviour. Thus, Brazil considers that establishing a country-wide dumping margin and duty rate in
the case of companies operating in NME countries is perfectly consistent with the GATT 1994 and
the ADA.

4. With these remarks, Brazil wishes to furt her elaborate on China's claim concerning the
determination of individual anti-dumping duties to each exporter being investigated. China claims
that Article 9(5) of the Basic AD Regulation violates Articles 9.2, 9.3 and 9.4 of the ADA.
2

5. In this regard, Brazil fails to see the releva nce of Article 9 of the ADA to China's claims
concerning Article 9(5) of the Basic AD Regulation. Article 9 of the ADA does not provide or even
imply that authorities are compelled to impose individual duties upon each company nor does it
prevent the authority to consider companies that are closely related as a single entity for the purposes
of dumping margin determination.

6. China's assertion that Article 9.2 of the AD A creates the obligation to establish individual
anti-dumping duties for each exporter/producer finds no support in the text of this provision.
Article 9.2 provides, in relevant part, that duties ar e to be collected "in the appropriate amounts". The
meaning of "appropriate amount" under this pr ovision was interpreted by the panel in Argentina -
Poultry Anti-Dumping Duties to mean an amount not exceeding the margin of dumping.
3 The panel
also noted that a violation of Article 9.2 of the ADA is entirely dependent on a violation of

1 See Korea – Paper AD Duty, Panel Report, para. 7.161.
2 China's First Written Submission, paras. 212-278.
3 See Argentina - Poultry Anti-Dumping Duties, Panel Report, para. 7.365.

Article 9.3, which means that an anti-dumping dut y that is in conformity with Article 9.3 is
necessarily "appropriate" within the meaning of Article 9.2.

7. With regard to Article 9.3 of the ADA, Chin a's claims are based on the understanding that the
dumping margin for exporters who do not receive individual treatment is not established in
compliance with Article 2 of the ADA. However, China's argument seems to disregard the fact that
non-market economy exporters do not have their dumping margin calculated solely on the basis of the
provisions of Article 2 of the ADA in the first plac e. This is provided in Article 2.7 of the ADA and
the second Supplementary Provision to paragraph 1 of Article VI of GATT 1994.

8. As to China's claim concerning Article 9.4 of the ADA, it is based on the assumption of a
breach of Article 9.3 of the ADA, which, as expl ained above, is based on an incorrect reading of
Article 9.

9. Brazil notes that the margin of dumping a nd the appropriate amount of anti-dumping duty can
only be determined after the decision on whether or not companies may be regarded as single entities
for dumping margin determination purposes. Thus , it would be illogical to conclude that not
establishing individual duties to companies which are found to operate as a single exporter is
incompatible with Article 9 of the ADA.

10. The second point Brazil wishes to address con cerns China's suggestion that under the non-
attribution requirement of Article 3.5 of the ADA authorities are under an obligation to estimate or,
somehow, to quantify, the impact of factors other than dumped imports on injury
4, an interpretation of
Article 3.5 that Brazil does not share.

11. Brazil considers that in order to comply with Article 3.5 of the ADA, investigating authorities
must identify, separate and distinguish the injurious effects of the dumped imports from the injurious
effects of other factors. This does not mean, however, that Article 3.5 of the ADA establishes an
obligation upon Members' investigating authorities to quantify or otherwise proceed to an estimation
of the injury caused by other factors. It is e nough for the authority to (i) investigate other factors
claimed to be causing injury; (ii) then to separate and distinguish th e injurious effects of these other
factors (for instance by considering that it is not subs tantial, or not of a nature of breaking the causal
link); and (iii) finally to assess whether, in the absen ce of these factors, injury would still have taken
place.

12. As noted by the Appellate Body in US - Hot Rolled Steel
5, the ADA does not prescribe the
methodology by which an investigating authority must avoid attributing the injury caused by factors
other than dumped imports. The Appellate Body me rely requires from investigating authorities that
they identify the effects of other factors, i.e., " undertake the process of assessing appropriately, and
separating and distinguishing, the injurious effect s of dumped imports from those of other known
causal factors." 6 The Appellate Body adds that "this requires a satisfactory explanation of the nature
and extent of the injurious effects of the other factors, as distinguished from the injurious effects of the
dumped imports ".7 Investigating authorities enjoy, however, broad discretion to choose how to
conduct such an analysis.

13. The next point Brazil would like to comment on concerns Article 12.2 of the ADA. Brazil
would like to recall that, pursuant to Article 12.2 of the ADA, the obligation imposed upon WTO
Members is that the public notice must contain information on findings reached on material issues. In
this regard, the Panel in EC - Pipe Fittings considered that material findings are those related to issues

4 China's First Written Submission, paras. 562-621, and paras. 1192-1249.
5 See US – Hot Rolled Steel, Appellate Body Report, para. 224.
6 Ibid., para. 228.
7 Ibid., para. 226.

that must necessarily be resolved in order for the investigating authorities to be able to reach their
determination.
8

14. China lists in its submission several points which it believes should have been published by
the EU authorities, both in the context of the review and the definitive Regulations.
9 The EU rejected
China's claim and indicated that all these points had been dealt with in the Regulations and disclosure
documents sent to interested parties.10

15. Brazil does not express a position on whether or not the EU is in breach of Article 12.2 of the
ADA regarding this specific issue. However, in Brazil's view, China's claim implies the inclusion of a
higher level of detail than the standard laid down in Article 12.2 of the ADA. Brazil understands that
Article 12.2 of the ADA does not impose the publication of all information but only of material issues
of fact and law. Brazil sustains that the standard set in this article is the information expressly listed
in items (i) to (v) of Article 12.2.1 of ADA, which are as follows: names of suppliers or the countries
involved, description of the product, margin of dumping and explanation of the methodology, relevant
considerations to the injury determination (in light of the fifteen impact factors brought by Article 3.4
of ADA) and the main reasons leading to the preliminary or final determination (such as causal link).

16. It should be noted that Article 12.2 of the ADA deals with publicity of determinations and not
with the right of defence, which involves distinct standards. Brazil recalls that even when certain
information is not available on the public notice, this does not mean that the information was not
disclosed to the interested parties in the course of the proceedings.

17. Moving on to the fourth point, Brazil w ould like to comment on China's assertion that
Article 3 of the ADA is applicable to sunset reviews conducted under Article 11.3 of this same
Agreement.
11

18. In what pertains to this issue, Brazil re fers to the findings of the Appellate Body in US –
OCTG from Argentina 12 and notes that Article 3 and Article 11.3 of the ADA deal with two
independent determinati ons: on the one hand, a determination of injury or threat thereof under
Article 3; and, on the other hand, a determina tion of likelihood of continuation or recurrence of
(dumping and) injury under Article 11.3. In addi tion, there is no provision within Article 11.3,
Article 3 or elsewhere in the ADA which would ma ndate investigating authorities to comply with
Article 3 provisions when conducting sunset reviews.

19. Accordingly, in the words of the Appellate Body, "[g]iven the absence of textual cross-
references, and given the different nature and purpose of these two determinations, we are of the view
that, for the "review" of a determination of injury that has already been established in accordance with
Article 3, Article 11.3 does not require that injury again be determined in accordance with Article 3.
We therefore conclude that investigating authorities are not mandated to follow the provisions of
Article 3 when making a likelihood-of-injury determination".
 13 (original emphasis)

 Mr. Chairman, distinguished members of the Panel, this concludes Brazil's statement. Brazil
will be pleased to answer any questions you may have. Thank you for your attention.

8 See EC - Pipe Fittings, Panel Report, para. 7.424.
9 China's First Written Submission, paras. 797-808 and paras. 1387-1402.
10 EU's First Written Submission, para. 508.
11 China's First Written Submission, para. 421 et seq.
12 See US – OCTG from Argentina, Appellate Body Report, para. 278.
13 Ibid., para. 280.

ANNEX D-2

THIRD PARTY STATEMENT OF COLOMBIA

I. INTRODUCTION

1. Mr. Chairman, distinguished Members of th e Panel, on behalf of the Government of
Colombia, I thank you for giving us the opportunity to express our views in this dispute.

2. Our participation as a third party is based on our systemic interest in the proper interpretation
of several provisions of the WTO covered agreem ents, discussed in this case. In its written
submission, Colombia set out its understanding of some of the major legal issues arising from this
dispute. I will therefore not repeat all the content of the submission, but will rather focus on a few
specific comments regarding the interpretation of the applicable WTO provisions in administrative
and sunset reviews of definitive anti-dumping duties.

3. Colombia recognizes that many of the issues in this dispute are factual in nature. In that
regard, Colombia would like to emphasize that it does not take a position as to whether the European
Union has or has not complied with its obligations under the Anti-dumping Agreement.

II. RULES APPLICABLE TO ADMINISTRATIVE AND SUNSET REVIEWS OF ANTI-
DUMPING DUTIES

4. Among China's claims against Council Im plementing Regulation (EU) No. 1294/2009 of
22 December 2009 (the "AD Review Regulation"), Co lombia finds specially interesting the legal
debate surrounding claims II:2 to II:5, relative to how the EU reviewed the anti-dumping duties
imposed through Council Regulation (EC) No. 1472/2006 of 5 October 2006.

5. Colombia's interest in this debate lies in th e need to clarify the applicable WTO provisions to
administrative and sunset reviews of anti-dumping duties imposed as a consequence of an initial
investigation. In this vein, Colombia supported pr oposals in the context of the negotiations under the
Doha Development Agenda to amend the Anti-dumping Agreement.

6. According to China's claims
1, Article 3 of the Anti-dumping Agreement, except for
Article 3.3, is totally binding upon national author ities in charge of undertaking administrative and
sunset reviews of anti-dumping duties pursuant to numerals 2 and 3 of Article 11 of the Anti-dumping
Agreement.

7. The EU has not contended the prior issue for the purposes of its defence. Nonetheless,
Colombia considers that this is a relevant opportuni ty to complement the systemic interpretation of
the Anti-dumping Agreement and to recall the proposal s that on the matter have been made under the
auspices of the negotiations of the Doha Development Agenda.

8. Numerals 2 and 3 of Article 11 of the An ti-dumping Agreement contain the conditions in
which administrative and sunset reviews can be undertaken with respect to anti-dumping duties
imposed as a consequence of an initial investigation.

1 China's First Written Submission, paras. 421-428.

9. Within the legal framework of Article 11 of the Anti-dumping Agreement, paragraph 4
clarifies that the evidence and procedures of admi nistrative and sunset reviews should be undertaken
in accordance with Article 6 of the Anti-dumping Agre ement. There is no additional clarification of
what other WTO provisions are applicable to those reviews.

10. Faced with this limited normative clarity, the panel US – DRAMS
2 held that for the purposes
of injury determination in these types of reviews, national authorities should follow the framework of
Article 3 of the Anti-dumping Agreement.

11. Following this view, it has been accepted under the WTO that with respect to injury
determination, national authorities undertaking admi nistrative and sunset reviews, must follow the
conditions provided for that matter in Article 3 of the Anti-dumping Agreement.

12. In response to the lack of clarity on the lega l framework of administrative and sunset reviews
for anti-dumping duties, a group of Members presented on 14 July 2004 a proposal to modify and
complement some provisions of the Anti-dumping Agreement. These proposals are introduced in
WTO document TN/RL/GEN/10. With a view to contributing to the legal debate, Colombia
highlights two of those proposals in order to provide the Panel with additional information that it may
consider when arriving at a decision on this case. Of course, Colombia is aware that the proposals do
not constitute a means of interpretation as provided for in the VCLT and that such proposals represent
the view of a group of Members and not necessarily of the membership as a whole.

13. Proposal 1 of the mentioned document, suggests that it should be clarified that administrative
and sunset reviews are subject, where relevant, to the provisions of Articles 2 (determination of
dumping), 3 (determination of injury), 4 (definition of domestic industry), 5 (initiation and subsequent
investigation) and 6 (evidence). In addition, to the extent that it is appropriate, the de minimis rule in
Article 5.8 of the Anti-dumping Agreement should appl y to the mentioned reviews. Finally on this
point, it is suggested that the methodology applied to the original investigation for comparison
between normal price and export price as stipulated in Article 2.4.2 of the Anti-dumping Agreement
should be applied to the reviews, unless a different methodology is requested by the exporters.

14. On the other hand, Proposal 2 of document TN /RL/GEN/10, suggests that indicative lists for
the assessment of dumping and "likelihood of injury" under Article 11.2 should be developed.

15. Among the elements of the indicative lists for dumping assessment, Members' investigating
authorities should take into account: (i) that dumping margins to be considered are those based on
current market conditions and pricing, rather than the ones at the time of the initial investigation; (ii)
in case the measure has been subject to reviews, they shall rely on the margin found in the most recent
review; and (iii) if no dumping margin is found, the "likelihood of injury" test shall not apply and the
measure shall be terminated.

16. With respect to the analysis of the "likelihood of injury", Members' authorities should take
into account: (i) that the assessment should be ba sed on current market information and not on the
conditions at the time of the initial investigation; as provided for in Article 3 of the Anti-dumping
Agreement, the investigation should be based on f acts, and not merely on allegations, conjectures or
speculations; and (ii) the determination of whethe r the antidumping duty continuation is warranted or
not, shall be based on the current volume of dumped imports.

17. Based on the above mentioned c onsiderations, Colombia invites the Panel to take into account
the mentioned proposals, as a non-legally binding information, in the review of the EU'S
implementation of Article 11 of the Anti-dumping Agreement. Colombia considers that these

2 Panel Report, US – DRAMS, footnote 501.

proposals can be especially relevant to clarify the debate between the Parties as to how to use the
provisions of Article 3 of the Anti-dumping Agreement in the present case. Particularly, with respect
to how the EU undertook and c oncluded on the extension of the definitive anti-dumping duty
reviewed under its Regulation.

III. CONCLUSION

18. Mr. Chairman, distinguished Members of the Panel, with these comments, Colombia expects
to contribute to the legal debate of the parties in this case, and would like to express again its
appreciation for this opportunity to share its points of view on this relevant debate, regarding the
applicable WTO provisions for administrative and sunset reviews of the Anti-dumping Agreement.
We thank you for your kind attention and remain at your disposal for any question you may have.

ANNEX D-3

EXECUTIVE SUMMARY OF THE THIRD PARTY
STATEMENT OF JAPAN

I. INTRODUCTION

1. In this oral statement, Japan would like to address the following important systemic issues.

 Whether Article 2.4 of the AD Agreement is applicable to the EU's analogue country
selection in the case of import from non-market economy;

 Whether "positive evidence" and "objective assessment" requirements under Article 3.1 of the
AD Agreement apply to its examination in a sunset review; and

 Whether Article 3.5 of the AD Agreement requires an authority to make quantitative analysis
in separating and distinguishing the injurious e ffects of the other factors from the injurious
effects of the dumped imports.

II. DISCUSSION

A. THE PANEL SHOULD CAREFULLY EXAMINE WHETHER ARTICLE 2.4 OF THE AD
AGREEMENT IS APPLICABLE TO THE EU'S ANALOGUE COUNTRY SELECTION

2. According to Article 2.7(a) of the Council Regulation No 384/96, which provides for the EU's
analogue country selection, "[i]n the case of imports from non-market economy countries, normal
value shall be determined on the basis of the pri ce or constructed value in a market economy third
country". As to this mechanism, China submits that Article 2.4 of the AD Agreement, which requires
the investigating authorities to make a fair comparison between the export price and the normal value,
"sets forth certain principles regarding the co mparability of export prices and normal value."
1 China
further claims that "an improper selection of an analogue country […] directly precludes a fair
comparison between the export price and the normal value" 2, and thus that the EU's analogue country
selection violates Article 2.4 of the AD Agreement. On the other hand, the European Union states that
"the purpose of the analogue country methodology must be to find a normal value that is compatible
with the export price," and that "[o]nce such a nor mal value has been identif ied the obligation stated
in Article 2.4 of making a fair comparison comes into play, but not before. The very wording of
Article 2.4 assumes that a normal value already exists."3

3. Thus, the question to be addressed by the Panel is whether Article 2.4 of the AD Agreement is
applicable to the selection of the analogue country in the context of determining the existence of
dumping for imports from non-market economy.

1 First Written Submission by China submitted to this Panel on 20 August 2010 ("China FWS"),
paras. 370, 924.
2 China FWS, paras. 375, 927.
3 First Written Submission by the European Union submitted to this Panel on 24 September 2010,

4. As China argues that "the selection of an appr opriate or suitable analogue country is the first
fundamental step in ensuring fair comparison" 4, the selection of the analogue country was the starting
point for the European Union to complete the en tire process of determining the existence of dumping
in this case, including a fair comparison of the export price with the normal value. It is also correct
that Article 2 of the AD Agreement sets forth the substantive rul es and disciplines on the process of
determining the existence of dumping.

5. In this regard, the panel in Egypt – Rebar has found, in the context of examining the scope of
the requirement not to impose "an unreasonable burden of proof" referred to in Article 2.4, that "[a]
straightforward consideration of the ordinary meanin g of this provision confirms that it has to do not
with the basis for and basic establishment of the export price and normal value (which are addressed
in detail in other provisions), but with the nature of the comparison of export price."
5 In this context,
the panel also found that Article 2.4 in its entirety "has to do with ensuring a fair comparison" of
export price and normal value, and "does not apply to the investigating authority's establishment of
normal value as such."
6 It is also noted that the issue as to who the parties to relevant sales should be
in calculating the normal value under Article 2.1, the Appellate Body in US – Hot-Rolled Steel stated
that, given that Article 2.4 of the AD Agreement provides that a fair comparison "shall be made at the
same level of trade, normally at the ex-factory level," "[t]he use of downstream sales prices to
calculate normal value may affect the comparability of normal value and export price because, for
instance, the downstream sales may have been made at a different level of trade from the export
sales."
7

6. Japan respectfully requests the Panel to caref ully review the arguments on the applicability of
Article 2.4 of the AD Agreement to the EU's analogue country selection, taking into account
viewpoints as discussed above.

B. APPLICABILITY OF "POSITIVE EVIDENCE" AND "OBJECTIVE ASSESSMENT"
REQUIREMENTS UNDER ARTICLE 3.1 OF THE AD AGREEMENT TO SUNSET
REVIEWS

7. Japan is mindful that, in US – Oil Country Tubular Goods Sunset Review, the Appellate Body
has found that "investigating authorities are not mandated to follow the provisions of Article 3 when
making a likelihood-of-injury determination", that "f actors such as the volume, price effects, and the
impact on the domestic industry of dumped impor ts, taking into account the conditions of
competition, may be relevant to varying degrees in a given likelihood-of-injury determination", and
that "the necessity of conducting such an anal ysis in a given case results from the requirement
imposed by Article 11.3—not Article 3".
8

8. It must be emphasized, however, that the above findings of the Appellate Body should be read
in their contexts. The Appellate Body also has found that authorities in a sunset review are obliged to
act with an appropriate degree of diligence and arrive at a reasoned conclusion on the basis of positive
evidence.9 The Appellate Body has found that "[c]erta in of the analyses mandated by Article 3 and
necessarily relevant in an original inv estigation may prove to be probative, or possibly even required,

4 China FWS, para. 387.
7 Appellate Body Report, US – Hot-Rolled Steel, paras. 167-168.
8 Appellate Body Report, US – Oil Country Tubular Goods Sunset Review, paras. 280, 284.
9 See Appellate Body Report, US – Oil Country Tubular Goods Sunset Review, para. 283. Appellate
Body Report, US – Corrosion Resistant Sunset Review , para. 111. See also Third Party Submission of Japan,
paras. 23-27.

in order for an investigating authority in a sun set review to arrive at a 'reasoned conclusion'."
10 It
further found "[i]n this respect, we are of the view that the fundamental requirement of Article 3.1 that
an injury determination be based on 'positive evid ence' and an 'objective examination' would be
equally relevant to likelihood determinations under Article 11.3."11 These findings suggest that, when
a likelihood-of-injury determinati on is inconsistent with the fund amental requirements of "positive
evidence" and "objective examination" mandated by Article 3.1, this would also demonstrate the
inconsistency of the likelihood-of-i njury determination with the requirement in Article 11.3 that the
authority arrive at a reasoned conclusion.12

9. While Japan does not take any particul ar position on China's establishment of a prima facie
case with respect to inconsistency of the EU's like lihood-of-injury determination with Article 11.3, it
respectfully requests the Panel to carefully review this issue, taking into account viewpoints as
discussed above.

C. ANALYSIS REQUIRED UNDER ARTICLE 3.5 OF THE AD AGREEMENT TO
SEPARATE AND DISTINGUISH INJURIOUS EFFECTS OF DUMPED IMPORTS FROM
THE INJURIOUS EFFECTS OF OTHER FACTORS

10. Article 3.5 of the AD Agreement provides that "the injuries caused by […] other [known]
factors must not be attributed to the dumped imports ." In this regard, as the Appellate Body pointed
out in US – Hot-Rolled Steel ,
13 the investigating authorities are required to "appropriately" separate
and distinguish the injurious effects of the othe r factors from the injurious effects of the dumped
imports under Article 3.5 of the AD Agreement.

11. However, the AD Agreement does not set any particular methods or approaches as to how
investigating authorities are to appropriately separate and distinguish these effects. In this connection,
Japan recalls that the Panel is ob liged to examine "whether the inv estigating authority has provided a
reasoned and adequate explanation" and that "a panel can assess whether an authority's explanation
for its determination is reasoned and adequate only if the panel critically examines that explanation in
the light of the facts".
14 In order for the Panel to examine whether the authority's explanation on the
causation is reasoned and adequate, therefore, the Pa nel must review the adequacy of the authority's
analysis of the non-attribution issue upon an examination of the particular facts of this case.

12. In some cases, it might be sufficient for th e authority to make a qualitative analysis on the
injurious effects of dumped imports and those of other factors in order to provide the reasoned and
adequate explanation that the injury is actually caused by those imports. In other cases it might be
necessary for the authorities to conduct a quantitativ e analysis separating and distinguishing the
injurious effects of dumped imports from the injurious effects of other factors for this purpose. At a
minimum, as stated by the panel in EC – Countervailing Measures on DRAM Chips in the context of
evaluating the non-attribution requirement under Article 15.5 of the SCM Agreement , "[a]n
investigating authority must do more than simply lis t other known factors, and then dismiss their role
with bare qualitative assertions".
15

13. In sum, the AD Agreement neither mandates nor exempts the authorities from making a
quantitative analysis to comply with the non-attribut ion rule under Article 3.5. The analytical method

10 Appellate Body Report, US – Oil Country Tubular Goods Sunset Review, para. 284 (Emphasis
Added).
11 Appellate Body Report, US – Oil Country Tubular Goods Sunset Review, para. 284.
12 See China FWS, para. 812.
13 Appellate Body Report, US – Hot-Rolled Steel, para. 223
14 See Appellate Body Report, US – Softwood Lumber VI (Article 21.5 – Canada), paras. 98-99
(Emphasis Original).
15 Panel Report, EC – Countervailing Measures on DRAM Chips, para. 7.405.

that an authority would be required to adopt depe nds on the underlying facts of the given case. Japan
respectfully requests that the Panel review whether the Commission provided a reasoned and adequate
explanation that it adequately separated and distin guished the injurious effects of the other factors
from the injurious effects of the dumped imports.

III. CONCLUSION

14. Japan respectfully requests the Panel to examin e carefully the facts presented by the parties to
this dispute in light of Japan's arguments as discusse d in its submission and above to ensure the fair
and objective application of the provisions of the AD Agreement.

ANNEX D-4

THIRD PARTY STATEMENT OF TURKEY

1. I am glad to present you with the views of Turkey at this stage of the panel proceedings
regarding the complaint launched by People's Repub lic of China. I will summarize Turkish position
on the subject, to the extent possible, by refraini ng from repetition of details presented in our written
submission. Turkey takes no position as to the de fence and allegations presented by the parties.
Turkey wishes to contribute by focusing on two majo r issues during this oral statement, namely
Analogue Country Selection and Sampling.

I. ANALOGUE COUNTRY SELECTION

2. Article 2.1 of the Anti-Dumping Agreemen t ("ADA") provides under what circumstances a
product is considered as being dumped. A plain interpretation of Article 2.1 clearly indicates that an
investigating authority has to work on two data groups namely normal value and export price to
determine whether dumping is present for the produc t under consideration. Accordingly, the
investigating authority is legally obliged to make a fair comparison based on the rules and standards
stipulated in Article 2.4 of the ADA between normal value and export price.

3. Most of the time, the normal value is determined by looking at sales of the like product in the
ordinary course of trade in the domestic market of the exporting country. Ho wever, as envisaged in
Article 2.2 of the ADA, in some situations dom estic prices and the exporting prices do not permit a
proper comparison. In order to overcome these di fficulties, the ADA provides alternative ways to
find a comparable price.

4. Furthermore, Ad. Article VI.2 of GATT1994 together with paragraph 15(a) of the Accession
Protocol of China provides derogation from the provi sions of the ADA regarding the determination of
normal value. In this context a WTO member may use a methodology that is not based on a strict
comparison with domestic prices or costs in China if the investigated producers cannot clearly show
that they are operating in market economy conditions.

5. Turkey considers that selecting an analogue country is the most reasonable method for
determining the normal value when the investig ated companies are not operating under market
economy conditions. In fact from the submission of th e Parties, Turkey understands that the use of
the analogue country procedure is not disputed between the parties.

6. Turkey would like to point that inves tigating authorities sometimes face difficulties in
analogue country selection. Companies to whic h analogue county questionnaires are sent sometimes
may not co-operate with the investigating authorities. Even if they respond properly, verification of
the data is another problem that the investiga ting authorities have to face with. The responding
countries are mostly reluctant to open their data a nd premises for verification since they are not party
of the investigation.

7. Turkey would also like to emphasize that th ere is no clear-cut provision in the ADA regarding
the selection procedure of analogue country. In this regard, Turkey considers that to some extent
members have the flexibly to adopt their own rules and procedures on this issue.

8. The critical question here is whethe r the selected analogue country should be an appropriate
or the most appropriate country. Taking into account the difficulties regarding the selection of
analogue country and the fact that the rules and procedures on this issue is not prescribed in the
ADA, Turkey considers that the standard applied in regard to the selection of the analogue country
should be "an appropriate country" standard, not "the most appropria te country" standard. Therefore,
if it can be determined that the selected country is appropriate in order to determine the normal value,
then the investigating authorities are not required to search for the most appropriate country to select
as analogue country.

9. In this context, if Brazil is an appropriate country under the internal standards set forth by the
EU, there is no need to search for the more or most appropriate country , since the standard is "an
appropriate country" standard. However, Turk ey refrains from making comments on whether the
selection of Brazil is appropriate for the footwear i ndustry since it is the question of the concrete case.
Turkey would like to share its opinion about what the threshold question should be on this issue.

10. With regard to the arguments whether the "fair comparison principle" prescribed under
Article 2.4 applies to the selection procedure of the analogue country, Turkey considers that
Article 2.4 does not govern the analogue country selection process. In Turkey's view, the "fair
comparison principle" prescribed under Article 2.4 requires the authorities to compare the "normal
value" and "export price" in a fair manner. Howeve r this requirement is rela ted with the comparison
stage of these two prices and not related with the calculation stage of the normal value or the export
price. Since there is no comparison, there is no "fair comparison" requirement as well before the
stage of determining the normal value and export price. Howeve r, once the normal value and the
export price are determined, the investigating au thorities are bound by the "fair comparison" rule.
The analogue country selection process is related with determining the normal value stage, not related
with the comparison stage.

11. Consequently, Turkey considers that the fa ir comparison principle set out under Article 2.4
does not govern the calculation of normal value or expor t price, it just covers the stage of comparison
of these two prices. The determination of whether Br azil is an appropriate analogue country is not an
issue that can be argued in the context of fair comparison principle.

II. SAMPLING

12. It is clearly understood from Article 6.10 of the ADA that while the general rule is to
calculate individual dumping margin for every known exporter/producer, sampling is an exception to
that general rule when the number of exporters/pro ducers/importers/types of products is too large to
make such an individual treatment.

13. China claims that by not examining the Ma rket Economy Treatment (MET) application of the
non-sampled companies, EU violated Article 6.10 of the Anti-Dumping Agreement. According to
China, an investigating authority has to evaluate separately all the MET applications, even if sampling
is recoursed and the companies in question are not included in the sampling process.

14. Turkey considers that this interpretation is incompatible with the spirit of the sampling
exception. When it is impractical to examine all the co-operated companies, by applying sampling the
investigating authorities have opportunity to exam ine only a limited group of exporters in order to
reach a determination in a timely manner on whether dumping exists.

15. Therefore once the sampling is applied, the investigating authorities make the examination of
whether dumping exists according to the data of the only sampled companies. This means that the
investigating authorities limit their examinati on only to a group of companies. The MET/IT
determinations constitute the part of this examination that is limited to group of sampled companies.

In other words the investigating authorities have to examine only the MET/IT application of the
companies that are included in the sample.

16. Especially, when a product in a fragmented i ndustry such as footwear is subject to an anti-
dumping investigation, it is actually not possibl e to examine all the co-operated companies'
applications since there may be hundreds of produ cers/exporters. That is the reason why sampling is
prescribed under the Article 6.10 as an exception to the individual treatment.

17. Consequently Turkey considers that the sampling rule prescribed under Article 6.10, which is
as an exception to the individual treatment principle, does not oblige the investigating authorities to
examine separately all the MET applications of th e companies which are not included in the sampling
process. Therefore, according to Turkey's view when sampling is recoursed, the investigating
authorities have to examine only the responses of the companies that are included in the sample
regardless of whether they applied for MET/IT.

III. CONCLUSION

18. Turkey wishes to thank the Panel for the opportunity to submit its views during this hearing
and welcomes any questions the Panel or the parties may have.

ANNEX D-5

EXECUTIVE SUMMARY OF THE THIRD PARTY
STATEMENT OF THE UNITED STATES

1. While the United States is not discussing today a ll of the issues that it addressed in its written
submission, the Panel should not interpret this as an indication that the United States considers those
issues to be unimportant. Indeed, even though the United States will not be discussing today most of
China's procedural claims, the United States would like to use this opportunity to reiterate its
appreciation of China's acknowledgment in its fi rst written submission of the importance of due
process and transparency in trade remedy proceed ings. The United States trusts that China will
demonstrate these in its administration of its own trade remedy laws.

2. One of China's principal claims in this dis pute is that Article 9(5) of the EU's Basic AD
Regulation is inconsistent with provisions of various covered ag reements because Article 9(5)
requires the investigating authority to apply a single dumping margin to multiple firms unless certain
conditions are met. China argues that Article 6. 10 of the AD Agreement permits application of a
single dumping margin to multiple exporters or pr oducers only where the number of producers and
exporters is so large as to make impracticable the application of individual dumping margins for
specific exporters or producers and, because Article 9( 5) of the Basic AD Regulation does not fit into
this narrow exception, it is inconsistent with Article 6.10.

3. The EU responds that China's argument fa ils because limiting the exporters or producers
examined due to their large number is not the only exception to the general requirement of an
individual margin contained in the first sentence of Article 6.10. A ccording to the EU, Article 6.10
permits application of a single margin of dum ping to multiple firms depending on the economic
realities of those firms.

4. The United States agrees that the economic realities of the firm s included in the investigation
are key to implementing the obligations in Article 6.10 of the AD Agreement. However, as we will
explain, these economic realities do not provide an additional exception to the first sentence of
Article 6.10. Instead, evaluation of the economic real ities of the firms included in the investigation is
part of the investigating authority's task in dete rmining the "exporters" and "producers" for which it
must generally determine an individual margin.

5. Article 6.10, first sentence, states that: "[ t]he authorities shall, as a rule, determine an
individual margin of dumping for each known export er or producer concerned of the product under
investigation." The provision then provides one exce ption to this rule when the number of exporters
or producers is so large as to make such a determination impracticable.

6. However, a fundamental question an investig ating authority must answer when fulfilling the
requirement of the first sentence of Article 6.10 is which "exporters" or "producers" are included in
the investigation. Put differently, Article 6.10 establishes that the identification of the specific
producers or exporters in an investigation is a condition precedent to calculating a dumping margin.
This question must be addressed in all anti-dum ping proceedings, both those involving market
economies and those involving non-market economies.

7. The United States recalls that the AD Ag reement does not define what constitutes an
"exporter" or "producer," nor does it establish criteria for an investigating authority to evaluate when
making this determination. As the United States and other Members in this dispute have recognized,
one particularly meaningful criterion in this inquiry is the economic realities of the firms included in
the investigation, including their structure and ope rations in the particular economy at issue. For
example, if a firm included in the investigation has a parent company that controls fundamental
business decisions such as those related to produc tion and pricing for the firm included in the
investigation, then it may be appropriate to cons ider that firm and its parent company as a single
exporter or producer.

8. Under such circumstances, it would not make sense to assign the firm and its parent company
separate margins of dumping because such a close relationship would permit the related exporters or
producers to channel exports through an affiliate w ith a lower dumping margin, thereby significantly
undermining the effectiveness of anti-dumping measu res. Nothing in the rule established in
Article 6.10 of the AD Agreement requires such a result.

9. The panel's reasoning in Korea – Paper fully supports the understanding of the United States
and other Members regarding Article 6.10. Consiste nt with this reasoning, the Panel should find that
nothing in Article 6.10 prohibits an investiga ting authority from treating multiple firms as one
exporter or producer if the facts demonstrate that the firms are sufficiently close that such treatment is
appropriate. Furthermore, to the extent that Article 9(5) of the EU Basic AD Regulation is a
mechanism for the investigating authority to examin e such a close relationship between firms, that
mechanism would not appear to be inconsistent w ith Article 6.10. Rather, such a mechanism would
be critical to assist the investigating authority in co mplying with the general rule in Article 6.10 to
calculate a single margin of dumping for every known exporter or producer.

10. Before leaving this discussion of Article 6. 10 of the AD Agreement, the United States would
like to address China's suggestion that Article 9( 5) of the Basic AD Regulation inappropriately
imposes "extra" conditions that have to be satisfi ed before firms in non-market economies can qualify
for an individual margin. As we have just d escribed, Article 6.10 of the AD Agreement does not
prohibit an investigating authority from consideri ng the economic realities of a firm when deciding
whether the firm on its own qualifies as a "producer" or "exporter" and should therefore receive an
individual margin. These economic realities necess arily include the kind of economy in which the
firm operates and, in a non-market economy situatio n, the degree of a firm's independence from the
government.

11. Among the distinguishing features of a non-market economy is that the role of the
government distorts the functioning of market principl es. That such distortion exists in the Chinese
economy is well understood. As the EU has pointed out, there is no shortage of evidence of the
Chinese government intervening in the Chinese economy. Indeed, the fact that WTO Members have
recognized the pervasiveness of government influe nce on the Chinese economy is reflected in both
China's Protocol of Accession and its Working Party Report.

12. Thus, in a non-market economy, the governme nt can exert influence over companies, which
can include the government making decisions related to production and pricing for the firm included
in the investigation. A lack of independence in pr oduction or pricing decisions is an important factor
in determining whether a firm constitutes an "exporte r" or "producer" for whic h an individual margin
of dumping must be calculated pursuant to Article 6.10 of the AD Agreement. Thus, firms in non-
market economies such as China operate under economi c realities that make it particularly important
for an investigating authority to analyse more closely the particular structures and operations of these
firms to evaluate their independence.

13. According to China, the EU acted inconsis tently with Article 2.4 of the AD Agreement
because the analogue country selection procedure and the selection of Brazil as the analogue country

precluded a fair comparison between export price and normal value. China argues that the first
sentence of Article 2.4 sets out the "overarching principl e or 'generic rule' that a fair comparison shall
be made between the export price and the normal value." China further argues that this fair
comparison requirement should guide the standard by which investigating authorities select an
analogue country. Thus, according to China, "an improper analogue country selection procedure
leading to the selection of an unsuitable/inappropria te analogue country . . . directly precludes a fair
comparison within the meaning of Article 2.4 ... ."

14. The EU responds that Article 2.4 does not apply to the selection of the analogue country
because the purpose of such selection is to find a normal value that is comparable with the export
price and only once a normal value has been identifie d does the fair comparison obligation stated in
Article 2.4 come into play. According to the EU, "the 'fair value' rule in paragraph 4 does not apply to
the choice of the normal value . . ." but, rather, th at the "standard process of finding the normal value
is set out" in Articles 2.1 and 2.2.

15. The United States agrees that Article 2.4 does not apply to the selection of an analogue
country. Contrary to China's assertions, Article 2.4 does not impose an "overarching principle" of fair
comparison in the selection of an analogue country . Nor does it guide the standard by which an
analogue country is selected. Instead, the focus of Article 2.4 is on how th e authorities ar e to select
specific transactions for comparison and make the a ppropriate adjustments for differences that affect
price comparability once the method for determining normal value has been selected. The general
obligation to make a "fair comparison" in the firs t sentence of Article 2.4 cannot be divorced from the
remainder of Article 2.4, which exemplifies the typ es of adjustments that an authority is obliged to
make in pursuit of price comparability.

16. As noted by the EU, the purpose of selecting an analogue country is "to find a normal value
that can be placed in comparison with the expor t price." In a market economy proceeding, an
authority would apply the rules in Articles 2.1 and 2.2 of the AD Agreement in selecting the home
market, a third country market or cost of produc tion as the method for determining normal value.
When dealing with a non-market economy, the selec tion of an analogue country substitutes for the
choice between home market, third country market or cost of production in a market economy
proceeding. Just as nothing in the text of Articles 2.1, 2.2 or 2.4 indicates that the first sentence of
Article 2.4 is relevant to the choice between home ma rket, third country market or cost of production,
nothing in paragraph 15(a)(ii) of the Protocol or Article 2.4 suggests that the first sentence of
Article 2.4 is relevant to the selection of the analogue country.

17. In summary, an authority uses the analogue c ountry selection procedure to select the basis on
which normal value will be determined. While Ar ticle 2.4 addresses how the export price and normal
value will be compared and the obligation to make adjustme nts for differences that affect price
comparability, it does not govern the basis on which no rmal value is determined. Thus, the obligation
under Article 2.4 to ensure a fair comparison between normal value and export price does not apply to
the selection of an analogue country.

18. China has asserted that the provisions of Article 3 of the AD Agreement apply to expiry
reviews (also referred to as "sunset" reviews) c onducted under Article 11.3 of the AD Agreement.
The EU responds – correctly in our view – that Chin a's argument is in legal error because the relevant
provision setting forth the disciplines relevant to the expiry review at issue is primarily Article 11.3 of
the AD Agreement and not Article 3. As the EU notes, China's arguments are directly contradicted by
the Appellate Body report in US - OCTG from Argentina.

19. As the United States explained in its writte n submission, the specific requirements imposed
by Article 3 of the AD Agreement for original inve stigations do not apply to sunset reviews under
Article 11.3. The Appellate Body has explained this on two occasions, noting that the AD Agreement
distinguishes between "determinations of injury " addressed in Article 3 and determinations of

likelihood of "continuation or recurrence . . . of in jury" addressed in Article 11.3. Moreover, turning
to the text of the Agreement, Artic le 11.3 contains no cross-refere nces to Article 3 that would make
Article 3 provisions applicable to sunset review s. Nor does the text of Article 3 mandate that
whenever the term "injury" is u sed in the AD Agreement, a determination of injury pursuant to the
provisions of Article 3 is required.

20. We also observe that Colombia's third party submission invites the Panel to consider
proposals made in the on-going Rules Negotiations concerning sunset reviews. We urge the Panel not
to do so for at least two reasons. First, there is no basis in customary rules of interpretation of public
international law, as reflected in Articles 31 and 32 of the Vienna Convention on the Law of Treaties ,
for considering these proposals, as Colombia noted in its oral statement today. The proposals do not
lend guidance to the meaning of the existing provis ions of the AD Agreement. Second, the proposals
do not reflect any consensus of Members. Instead, th ey merely reflect the views of some Members as
to how the Agreement should be changed. For these reasons, the proposals should not be given any
weight.

21. China asserts that the EU acted inconsisten tly with Article 6.9 because the investigating
authority did not allow sufficient time for parties to respond to a supplemental disclosure explaining a
new methodology being used to calculate the "lesser duty." The EU responds that this disclosure was
not one of essential facts, but disclosed only outcomes or methodologies and, therefore, the provision
of Article 6.9 requiring sufficient time to respond is not applicable.

22. The United States agrees with the EU to the ex tent that the EU asserts that Article 6.9 does
not pertain to the disclosure of outcomes or methodologies by the investigating authority. Rather, the
focus of Article 6.9 is whether there is a disclosur e of "essential facts" and, if so, whether the time
allotted to interested parties to analyse and comme nt on the disclosure of such facts was reasonable
under the circumstances.

23. In addition, even when Article 6.9 applies, its text does not specify any minimum amount of
time that would constitute "sufficient time" for a party to defend its interest. Therefore, what
constitutes "sufficient time" for an interested part y to defend its interests and respond to an essential
facts disclosure will depend on the size, significance, and nature of the disclosure.

24. China claims that the EU acted inconsisten tly with Article 3.3 of the AD Agreement by
cumulating imports from China and Vietnam because the conditions of competition between the
imports from China and Vietnam were not equivalent. China's claim is based on the erroneous legal
premise that an investigating authority must est ablish that imports from different countries have
similar volume and market share trends in order to demonstrate that cumulation is appropriate in light
of the conditions of competition pursuant to Article 3.3.

25. The text of Article 3.3 sets out the only specific requirements for cumulation, and there is no
legal basis to impose other requirements for cumulation. These specific requirements are that the
dumping margins for the individual countries must be more than de minimis, the volume of imports
from the individual countries cannot be negligible , and there must be a determination that a
cumulative assessment is appropriate in light of conditions of competition between the imported
products and between the importe d products and the domestic like product. The AD Agreement does
not elaborate on the factors to be considered by an authority in making the determination regarding
conditions of competition, let alone require that an authority must find the type of identity in trends
described by China.

26. In its third party submission, Colombia invit es the Panel to identify standards with respect to
the criteria that an authority should take into account when considering conditions of competition.
We urge the Panel to reject Colombia's invitation. First, we note that Colombia itself acknowledges
that Article 3.3 of the AD Agreement does not specify criteria that must be considered under the

conditions of competition. Second, to the extent that Colombia is asking the Panel to do more than is
necessary to resolve this dispute, we woul d recall the Appellate Body's admonition in US – Wool
Shirts that panels and the Appellate Body should not "'make law' by clarifying existing provisions of
the WTO Agreement outside the context of resolving a particular dispute."

27. Regarding China's claim that the EU authorities acted inconsistently with Article 6.1.1 of the
AD Agreement by allowing less than 30 days for in terested parties to submit responses to MET and
IT claim forms, the United States notes that the panel in US – AD/CVD Duties on Products from
China recently rejected a similar claim by China under Article 12.1.1 of the SCM Agreement, a
provision that is almost identical to Article 6.1.1, at paragraphs 15.15 to 15.37 of the report.