CANADA – PROVISIONAL ANTI-DUMPING AND COUNTERVAILING DUTIES ON GRAIN CORN FROM THE UNITED STATES
Document: Request for Consultations by the United States
Date: 22 March 2006
Document codes: WT/DS338/1; G/L/767; G/ADP/D65/1; G/SCM/D66/1
Complainant: U.S.
Respondent: Canada
Dispute stage: Consultation
Agreements cited: Art. 1, 3, 3.2, 3.4, 3.5, 7, 12.2.1  Anti-dumpingArt. VI  GATT 1994Art. 10, 15, 15.2, 15.4, 15.5, 17, 22.4  Subsidies and Countervailing Measures (SCM)

CANADA – PROVISIONAL ANTI-DUMPING AND COUNTERVAILING DUTIES
ON GRAIN CORN FROM THE UNITED STATES

Request for Consultations by the United States

 The following communication, dated 17 Marc h 2006, from the delegation of the United States
to the delegation of Canada and to the Chairman of the Dispute Settlement Body, is circulated in
accordance with Article 4.4 of the DSU.

 My authorities have instructed me to request consultations with the Government of Canada
pursuant to Articles 1 and 4 of the Understanding on Rules and Procedures Governing the Settlement
of Disputes ("DSU"), Article XXII of the General Agreement on Tariffs and Trade 1994
("GATT 1994"), Article 17 of the Agreement on Implementation of Article VI of the General
Agreement on Tariffs and Trade 1994 ("AD Agreement"), and Article 30 of the Agreement on
Subsidies and Countervailing Measures ("SCM Agreement") with respect to Canada's imposition of
provisional antidumping and countervailing duties on unprocessed grain corn from the United States
published in the Canada Gazette on 31 December 2005, and also with respect to certain provisions of
Canada's Special Import Measures Act ("SIMA"). These measures appear to be inconsistent with
Canada's obligations under provisions of the GATT 1994, the AD Agreement, and the
SCM Agreement.

 In particular, the United States believes th at the provisional antidumping and countervailing
duties on unprocessed grain corn are inconsistent with at least the following provisions:

1. Article 3 of the AD Agreement and Artic le 15 of the SCM Agreement, in that:

a. the Statement of Reasons published by the Canadian International Trade Tribunal
("CITT") on 30 November 2005, in support of its preliminary determination of injury
does not address or refer to mandatory fact ors in an injury analysis such as the
volume of imports
1 the price of imports, and the impact of imports on the domestic
industry;

b. the CITT expressly decided not to analy se the evidence before it with respect to
causation, including with respect to the cau sal link between imports and injury and
with respect to injury caused by factors other than imports;

1 For example, the Statement of Reasons not only fa ils to address the 42% decline in the volume of
imports during the period when injury allegedly occurred , the Statement does not even refer to the volume of
imports at all.
WT/DS338/1, G/L/767,
G/ADP/D65/1, G/SCM/D66/1

c. the CITT based its preliminary finding of injury solely on a supposed correlation
between past injury to the Canadian domest ic industry and an alleged decline in the
US domestic price of unprocessed grain corn rather than on the mandatory injury
factors identified in these provisions of the AD Agreement and SCM Agreement;

d. the evidence supporting the alleged declin e in the US domestic price of unprocessed
grain corn relied upon by the CITT was in fact largely a projection of future grain
corn prices and therefore could not have b een correlated with p ast injury to the
domestic industry as the CITT found, even if such correlation were relevant to an
injury determination; and

e. based on the above, the CITT failed to base its preliminary injury finding on "positive
evidence" and an "objective examination" of that evidence;

2. Articles 1, 7, and 12.2.1 of the AD Agreement, Articles 10, 17, and 22.4 of the
SCM Agreement, and Article VI of GATT 1994, by imposing provisional antidumping and
countervailing duties based, in part, on a preliminar y injury determination that is inconsistent
with Article 3 of the AD Agreement and Artic le 15 of the SCM Agreement as described
above.

 In addition, SIMA and any amendments, implem enting measures, or related measures, appear
to be inconsistent with Article 3.5 of the AD Agreement, Article 15.5 of the SCM Agreement, and
Article VI of GATT 1994, as they would appear to require the imposition of antidumping and
countervailing duties upon a finding by the competent authorities that the "dumping and subsidizing"
of the subject goods, including alleged effects of s ubsidies on the domestic prices of the goods in the
market of the dumping or subsidizing Member, have caused or threaten to cau se injury to Canada's
domestic industry, even in the absence of any finding that the dumped or subsidized imports, through
the effects of dumping or subsidies, as set forth in Articles 3.2 and 3.4 of the AD Agreement and
Articles 15.2 and 15.4 of the SCM Agreement, respectively, had caused or threatened to cause injury.

 Canada's measures also appear to nullify or im pair the benefits accruing to the United States
directly or indirectly under the cited agreements.

 We look forward to receiving your reply to the present request and to fixing a mutually
convenient date for the consultations.