UNITED STATES – MEASURES RELATING TO ZEROING AND SUNSET REVIEWS
Document: Recourse to Article 21.5 of the DSU by Japan Request for the Establishment of a Panel
Date: 8 April 2008
Document codes: WT/DS322/27
Complainant: Japan
Respondent: U.S.
Third parties: Argentina, China, EU, Hong Kong, India, South Korea, Mexico, New Zealand, Norway, Taiwan, Thailand
Dispute stage: Implementation & Compliance
Agreements cited: Art. 2.1, 2.4, 2.4.2, 9.1, 9.2, 9.3, 5.8, 3, 9.5, 11.1, 11.2, 11.3, 1  Anti-dumpingArt. VI  GATT 1994Art. 18.4  Anti-dumpingArt. XVI:4  Agreement Establishing the World Trade Organization

UNITED STATES – MEASURES RELATING TO ZEROING
AND SUNSET REVIEWS

Recourse to Article 21.5 of the DSU by Japan

Request for the Establishment of a Panel

 The following communication, dated 7 April 2008, from the delegation of Japan to the
Chairman of the Dispute Settlement Body, is circulated pursuant to Article 21.5 of the DSU.

 My authorities have instructed me to requ est the establishment of a panel pursuant to
Articles 6 and 21.5 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 Ar ticle VI of the GATT
1994 (" Anti-Dumping Agreement ") in connection with the United States' failure to implement the
recommendations and rulings of the Dispute Settlement Body (“DSB”) in this dispute.
 The documentation for the panel establishment request is attached and we would like to ask
you to circulate the attached document to the members.

I. BACKGROUND TO THIS REQUEST
1. On 23 January 2007, the DSB adopted the Appe llate Body Report, and the Panel Report, as
modified by the Appellate Body Report. The DSB ruled that:
(i) by maintaining zeroing procedures
1 in original investigations when calculating
margins of dumping on the basis of we ighted average-to-weighted average
comparisons, the United States acts inconsistently with Article 2.4.2 of the
Anti-Dumping Agreement;2

(ii) by maintaining zeroing procedures in original investigations when calculating
margins of dumping on the basis of transaction-to-transaction comparisons, the

1 The term "zeroing procedures" refers to the methodology under which the United States Department
of Commerce ("USDOC") disregards intermediate negative comparison results in the process of establishing the
overall dumping margin for the product as a whole for a foreign producer or exporter. See Appellate Body
Report, footnote 3.
2 Panel Report, para. 7.258(a).

United States acts inconsistently with Articles 2.4 and 2.4.2 of the Anti-Dumping
Agreement;
3

(iii) by applying zeroing procedures in the anti-dumping investigation regarding imports
of cut-to-length carbon quality steel products from Japan, the United States acted
inconsistently with Article 2.4.2 of the Anti-Dumping Agreement;4

(iv) by maintaining zeroing procedures in periodic reviews, the United States acts
inconsistently with Articles 2.4 and 9.3 of the Anti-Dumping Agreement and
Article VI:2 of the GATT 1994;5

(v) by maintaining zeroing procedures in ne w shipper reviews, the United States acts
inconsistently with Articles 2.4 and 9.5 of the Anti-Dumping Agreement;6

(vi) by applying zeroing procedures in the 11 periodic reviews identified in Japan's
Request for the Establishment of a Panel 7, the United States acted inconsistently with
Articles 2.4 and 9.3 of the Anti-Dumping Agreement and Article VI:2 of the
GATT 1994;8 and

(vii) by relying on margins of dumping calculated in previous proceedings using the
zeroing procedures in the two sunset review s identified in Japan 's Request for the
Establishment of a Panel 9, the United States acted inconsis tently with Article 11.3 of
the Anti-Dumping Agreement.10

2. At the DSB meeting on 20 February 2007, the United States informed the DSB that it
intended to implement the recommendations and ruli ngs of the DSB. The United States and Japan
thereafter agreed, under Article 21.3(b) of the DSU, that the reasonable period of time ("RPT") for the
United States to implement the DSB's recommenda tions and rulings would expire on 24 December
2007.
3. On 10 March 2008, Japan and the United Stat es decided on procedures that would apply
between them under Articles 21 and 22 of the DSU for purposes of this dispute.
11 Paragraph 1(a) of
that decision provides that Japan need not hold consultations with the United States prior to requesting
the establishment of a panel; paragraph 1(b) states that the United States will accept the establishment
of a panel at the first DSB meeting at which Japan's panel request appears on the agenda.
II. DECLARED IMPLEMENTATION ACTION AND INACTION
4. In its status report to the DSB of 8 November 2007, the United States informed the DSB that:
"On 6 March 2006, the US Department of Commerce published a notice requesting
comments on its intention to no longer perfo rm average-to-average comparisons in
anti-dumping investigations without offsets. On 26 January 2007, the Department
published a notice that the date after wh ich it would no longer perform such

4 Panel Report, para. 7.258(a).
7 WT/DS322/8.
9 WT/DS322/8.
11 WT/DS322/26.

comparisons would be 22 February 2007. Accordingly, as of 22 February 2007, the
United States is no longer performing av erage-to-average comparisons in
anti-dumping investigations without offsets."12
In the same report, the United States added that it wa s "continuing to consult internally on steps to be
taken with respect to the other DSB recommendations and rulings."
5. On 6 December 2007, the United States provided an identical report to the DSB, with no
additional information.13
6. On 27 December 2007, the United States Depa rtment of Commerce ("USDOC") announced
publicly that it had taken steps to implement the DSB's recommendations and rulings with respect to
the anti-dumping investigation regarding imports of cut-to-length carbon quality steel products. In
particular, the USDOC recalculated the margin of dumping without zeroing.14
7. On 10 January 2008, the United States informed the DSB that:
"With respect to the assessment reviews at issue in this dispute, in each case the
results were superseded by subsequent review s. Because of this, no further action is
necessary for the United States to bring these challenged measures into compliance
with the recommendations and rulings of the DSB."15
8. At the DSB meeting on 21 January 2008, the Unite d States informed the DSB of its view that
the elimination of zeroing in average-to-avera ge comparisons in anti-dumping investigations, as
described in paragraph 4 above, also implemen ted the DSB's recommendations and rulings with
respect to the maintenance of zeroing procedures in transaction-to-transaction comparisons in anti-
dumping investigations, and in periodic and new shipper reviews.
III. MEASURES AT ISSUE AND CLAIMS MADE IN THESE PROCEEDINGS
A. ZEROING PROCEDURES
9. The DSB made four separate recommendations an d rulings that the United States bring the
zeroing procedures into conformity with its WTO obligations. These recommendations and rulings
related to the maintenance of zeroing procedures as a general rule: (1) in weighted average-to-
weighted average ("W-to-W") comparisons in original investigations; 16 (2) in transaction-to-
transaction ("T-to-T") comparisons in original investigations; 17 (3) in any comparison methodology in
periodic reviews;18 and (4) in any comparison methodology in new shipper reviews.19
10. Although, as noted in paragraph 4, the United Stat es informed the DSB that, with effect from
22 February 2007, it withdrew the zeroing proce dures in W-to-W comparisons in original
investigations, Japan is unaware of the adoption by the United States of any measures to implement
the DSB's recommendations and rulings regarding th e maintenance of zeroing procedures: (1) in

12 WT/DS322/22.
13 WT/DS322/22/Add.1.
14 See Issues and Decision Memorandum for the Final Results, Investigation A-588-847, Section 129
Proceeding (Dec. 27, 2007), available at http://ia.ita.doc.gov/ia-news-2007.html.
15 WT/DS322/22/Add.2.
16 Panel Report, para. 7.258(a).

T-to-T comparisons in original investigations ; (2) in any comparison methodology in periodic
reviews; and (3) in any comparison methodology in new shipper reviews.
11. By continuing to maintain zeroing procedures in these contexts, and failing to implement the
DSB's recommendations and rulings, the United Stat es acts inconsistently with Articles 17.14, 21.1
and 21.3 of the DSU and, as set forth in the DSB' s recommendations and rulings, Article 2.4 of the
Anti-Dumping Agreement and Articles VI:1 and VI:2 of the GATT 1994. Additionally, as also set
forth in the DSB's recommendations and rulings, in connection with T-to-T comparisons in original
investigations, the United States violates Article 2.4.2 of the Anti-Dumping Agreement; in connection
with periodic reviews, it violates Article 9.3 of the Anti-Dumping Agreement; and, in connection with
new shipper reviews, it violates Article 9.5 of the Anti-Dumping Agreement.
B. P
ERIODIC REVIEWS
12. This request concerns five of the 11 periodic re views mentioned in paragraph 1(vi), plus three
closely connected periodic reviews that the United States argues "superseded" the original reviews.
The United States used zeroing in each of these revi ews and, despite the DSB's recommendations and
rulings, has omitted to eliminate zeroing from any of them. These eight periodic reviews are
identified in Annex 1 of this Request, and stem from anti-dumping duty orders on "Ball Bearings and
Parts Thereof From Japan", "Cylindrical Roller Bearings and Parts Thereof From Japan", and
"Spherical Plain Bearings and Parts Thereof From Ja pan". This request also concerns United States
Government instructions and notices, issued since th e end of the RPT, to liquidate entries covered by
these eight reviews. Further, the request concerns any amendments to the eight periodic reviews and
the closely connected instructions and notices, as well as any subsequent closely connected measures.
13. Since the end of the RPT, through the eight periodic reviews at issue, and the United States
Government instructions and notices, the United St ates has improperly continued to impose, collect,
and/or assess anti-dumping duties in excess of the proper margin of dumping, and will continue to do
so. The United States thereby improperly impo ses duties on the importation of Japanese goods in
excess of the duties permitted under the United States' Schedule of Concessions.
14. The United States' failure to take measures to eliminate zeroing and, thereby, to bring itself
into conformity with its WTO obligations, is incons istent with Articles 17.14, 21.1 and 21.3 of the
DSU. As a result of this omission, the United States continues to act inconsistently with Articles 2.4
and 9.3 of the Anti-Dumping Agreement and Article VI:2 of the GATT 1994, as set forth in the DSB's
recommendations and rulings. Further, the United St ates' measures taken to comply, if and to the
extent they exist, are inconsistent with Articles 2.4, 9.2 and 9.3 of the Anti-Dumping Agreement and
Articles II:1(a), II:1(b), VI:1 and VI:2 of the GATT 1994 for the reasons given in the previous
paragraph.
C. SUNSET REVIEWS
15. The United States has failed to take any action to bring the sunset review determination of 4
November 1999 regarding the anti-dumping duty order on Anti-Friction Bearings from Japan, covered
by paragraph 1(vii) above, as well as the sunset revi ew determination of the same order, of 4 May
2006, into conformity with its WTO obligations. Both measures are identified in Annex 2. As a
result, the United States acts inconsistently with Articles 17.14, 21.1 and 21.3 of the DSU and, as set
forth in the DSB's recommendations and rulings, Article 11.3 of the Anti-Dumping Agreement.

IV. CONCLUSION
16. Japan requests that a panel be established under Article 21.5 of the DSU with standard terms
of reference, as set forth in Article 7.1 of the DSU, and asks that this request be placed on the agenda
of the DSB meeting scheduled for 18 April 2008.

ANNEX I: PERIODIC REVIEWS

ORDER
(CASE NUMBER) NO. PERIODIC REVIEW
(MEASURES AT ISSUE) COMPANIES
1 1 May 1999 – 30 April 2000
(66 Fed. Reg. 36551, 12 July 2001)
(As amended: 72 Fed. Reg. 67892,
3 December 2007) (NTN))
JTEKT20 and NTN
2 1 May 2000 – 30 April 2001
(67 Fed. Reg. 55780, 30 August 2002)
(As amended: 73 Fed. Reg. 15481,
24 March 2008)
NTN
3 1 May 2002 – 30 April 2003
(69 Fed. Reg. 55574, 15 September 2004)
JTEKT, NSK and
NTN
4 1 May 2003 – 30 April 2004
(70 Fed. Reg. 54711, 16 September 2005)
(As amended: 70 Fed. Reg. 61252,
21 October 2005 (NSK))
(As amended: 70 Fed. Reg. 69316,
15 November 2005 (Nippon Pillow Block))
JTEKT, Nippon
Pillow Block, NSK
and NTN
5 1 May 2004 – 30 April 2005
(71 Fed. Reg. 40064, 14 July 2006)
JTEKT, NSK,
Nippon Pillow Block
and NTN
Ball Bearings and
Parts Thereof From
Japan (A-588-804)
6 1 May 2005 – 30 April 2006
(72 Fed. Reg. 58053, 12 October 2007)
Asahi Seiko,
JTEKT, NSK,
Nippon Pillow Block
and NTN
Cylindrical Roller
Bearings and Parts
Thereof From Japan
(A-588-804)
7 1 May 1999 – 31 December 1999
(66 Fed. Reg. 36551, 12 July 2001)
JTEKT and NTN
Spherical Plain
Bearings and Parts
Thereof From Japan
(A-588-804)
8 1 May 1999 – 31 December 1999
(66 Fed. Reg. 36551, 12 July 2001)
NTN

20 JTEKT is formerly known as Koyo Seiko Co. Ltd.

ANNEX 2: SUNSET REVIEWS

ORDER
(CASE NUMBER) NO. SUNSET REVIEWS
(MEASURES AT ISSUE)
9 1994 – 1999 (64 Fed. Reg. 60275,
4 November 1999)
Antifriction Bearings from Japan
(A-588-804)
10 2000 – 2005 (71 Fed. Reg. 26321,
4 May 2006)