Document: WT/DS206/R Page C-1 ANNEX C Second Submissions by the Parties Contents Page Annex C-1 Second written submission of India C-2 Annex C-2 Second written submission of the United States C-31
Document codes: WT/DS206/R
Complainant: India
Respondent: U.S.
Third parties: Chile, EU, Japan
Dispute stage: Panel
Agreements cited: Art. VI:1, VI:2(a)  GATT 1994Art. 2.2, 2.4, 6.8, 9.3, 15, 18.4, Annex II  Anti-dumpingArt. XVI:4  Agreement Establishing the World Trade Organization

ANNEX C
Second Submissions by the Parties
Contents Page
Annex C-1 Second written submission of India C-2
Annex C-2 Second written submission of the United States C-31

V. NO UNBIASED AND OBJECTIVE INVESTIGATING AUTHORITY COULD
HAVE CONCLUDED THAT SAIL'S SUBMITTED US SALES INFORMATION
WAS NOT VERIFIABLE............................................................................................... C-20
A. MEANING OF THE TERM "VERIFIABLE" .................................................................. C-20
B. THE VERIFICATION OF SAIL'S US SALES COMPUTER DATABASE
DEMONSTRATED THAT IT WAS "VERIFIABLE" ..................................................... C-22
C. USDOC IMPROPERLY FOUND THAT SAIL'S US SALES DATA WAS NOT
VERIFIABLE BECAUSE OF THE UNVERIFIABILITY OF INFORMATION
IN THE HOME MARKET SALES AND COST OF PRODUCTION DATABASE....... C-25
VI. MEANING OF "DOES NOT COOPERATE" IN ANNEX II, PARAGRAPH 7...... C-26
VII. USDOC IMPROPERLY DREW ADVERSE INFERENCES IN THE FINAL
DETERMINATION BY USING THE $251 OFFER AS THE EXPORT PRICE..... C-28
VIII. CONCLUSION.................................................................................................................. C-29

I. INTRODUCTION
1. The record at this stage of the proceeding shows with increasing clarity that USDOC's final
determination on cut-to-length plate from India, discarding SAIL's verified, timely produced and
usable US sales data, violated India’s rights under the Anti-dumping Agreement. That final
determination adopted wholesale the worst-case calculation offered by the petitioning domestic
industry -- based primarily on an export price of $251 per ton
1 that was contradicted by the very
evidence claimed as corroboration by USDOC. USDOC's adoption of the petitioners’ calculation
using the unsupported US price did not provide a fair comparison between the export price and the
normal value as required by Article 2.4, first sentence. Nor did USDOC's rejection of SAIL's US
sales data comply with the facts available provisions of Article 6.8 and Annex II, paragraph 3. The
record shows that the US sales data were timely produced, were in the requested computer format,
were exhaustively verified and thus were "verifiable". Most importantly, they could have been used in
a number of methods together with normal value in formation in the petition to calculate -- without
any difficulty -- a final dumping margin.
2. India will focus on several key issues in its rebuttal submission. First, India responds to US
arguments concerning the standard of review. Sec ond, India addresses US arguments that the text of
Article 6.8 permits anti-dumping authorities to apply total facts available. Third, India discusses the
important question of "undue difficulty," as follows:
• First, India discusses the meaning of the phrase "can be used without undue difficulty,"
responding to the Panel's questions during the First Meeting, written questions 33 and 34, and
arguments raised by the United States during that meeting.
• Second, India raises a fundamental pro cedural objection under AD Agreement
Article 17.6 to the United States' newly asserted evaluation of the facts regarding the
usability of SAIL's US sales data, which differs from the evaluation it made in the
Final Determination.
• Third, India points out that the novel US assertion regarding SAIL’s US sales
database− that the lack of cost data from which “difference in merchandise” (or
“difmer”) adjustment could be calculated rendered SAIL's database unusable − is
inconsistent with the United States’ own anti-dumping law. In fact, “difmer”
adjustments under the US anti-dumping statute are applied only to normal value
(NV)– never to US price– so the lack of data to calculate the “difmer” adjustment for
SAIL cannot undermine the validity of its US sales database.
• Fourth, even accepting the relevance of the US argument, India further points out that
USDOC routinely fills in gaps in respondents’ submitted databases, including
expressly accepting a respondent’s database from which DIFMER data was absent.
USDOC recently used the submitted data in a way that limited the importance of the
missing information, just as India has proposed in this case.
• Fifth, even accepting for purposes of argument that the cost issue is relevant to the
usability of SAIL's US sales data, India sets out a number of different methods by
which the margins could be calculated “without undue difficulty,” using NV and cost
data from the petition.

1 Ex. IND-1, at figure 5, page 000040 (public version).

3. In Section V of this submission, India addresses the issue of the meaning of the terms
“verified" and “verifiable.” India discusses how SAIL's US sales data was actually verified during the
intensive, multi-week verification process in India. Using USDOC's own description of that process,
India demonstrates how SAIL's US sales data met the criterion of being "verifiable" in Annex II,
paragraph 3.
4. Finally, in sections VI India responds to US arguments that a respondent who does not act to
the best of its ability under Annex II, paragraph 5 necessarily "does not cooperate" within the meaning
of Annex II, paragraph 7, and in Section VII to arguments that USDOC properly drew adverse
inferences in its Final Determination. India summarizes the key measures and claims at issue in this
dispute in Section VIII in the Conclusion.
5. India has provided extensive answers to the Panel's questions in a separate document. These
answers set forth, inter alia , evidence, argument and discussion related to many of India's claims.
India will not repeat that discussion in this submission. Among the claims addressed in the Answers
include the following:
• Article 2.4 - USDOC's failure to make a fair comparison between export price and
normal value (Answer to Question 20).
• Article 15, first sentence - USDOC's failure to adhere to its obligation to give special
regard to SAIL (Answer to Question 25).
• Article 6.8, Annex II, paragraph 3 - "as appl ied" claim relating to USDOC's practice
of applying total facts available in this case (Answer to Questions 35-36).
6. India will respond at the Second Meeting of the Panel to any comments made regarding these
and other claims in the United States submission of 18 February addressing India's answers to the
Panel's questions.
II. STANDARD OF REVIEW
7. The United States suggests in paragraph 66 of its First Submission that the Panel may not
focus on only particular facts in the investigative record, but instead “are directed to look to the entire
administrative record of an investigation.” India disagrees with this suggestion. The entire
investigative record in this case is enormous, as it is in many anti-dumping investigations. The Panel's
"objective assessment of the facts of the matter" under AD Agreement Article 17.6(i) (as well as DSU
Article 11) necessarily involves the relevant and pertinent facts related to the measures and legal
claims at issue. Any other standard of review would be unworkable. Because this dispute focuses on
particular facts in an anti-dumping investigation, the Panel must make, in the words of the Appellate
Body, "an active review or examination of the pertinent facts."2
8. Applying this "active review" of "pertinent facts" standard under Article 17.6(i), the Panel
should determine that USDOC's establishment of certain facts was not proper, and USDOC’s
evaluation of the facts was not unbiased and objective. The following are some of the key factual
evaluations that could not have been made by an unbiased and objective investigating authority:
• USDOC's determination to use a $251 per ton offer price in the petition as the export
price in calculating a final dumping margin, when the allegedly corroborating

2 Japan Hot-Rolled, WT/DS184/AB/R at para 55 (emphasis added).

evidence in the petition showed an average unit price of $354 per ton 3 during the
period of investigation, and SAIL's own veri fiable data showed an average price of
$346 per ton4 during the period of investigation;
• USDOC's finding that SAIL's US sales data "failed verification" because of the
unreliability of information in other categories of information, and without regard for
the fact that the information had actually been verified, as reflected in USDOC's own
verification report; and
• USDOC's determination not to use SAIL's US sales database in the calculation of a
final dumping margin, despite its own statement that the data were "useable" if errors
"susceptible to correction" were corrected, and despite the fact that SAIL provided
USDOC with a variety of methods to use the data, and that the methods could have
been used without undue difficulty.
III. INTERPRETATION OF THE PHRASE IN ARTICLE 6.8 "PRELIMINARY AND
FINAL DETERMINATIONS . . . MAY BE MADE ON THE BASIS OF THE FACTS
AVAILABLE"
9. The United States argues at paragraphs 93-97 of its First Submission that the phrase,
"preliminary and final determinations may be made on the basis of the facts available" in AD
Article 6.8 means that investigating authorities have the authority to make such determinations using
total facts available without any limits. This argument, like the US argument concerning
"information" at paragraphs 82-92 of the US First Submission, totally ignores the mandate in the AD
Agreement that Annex II, paragraph 3 must be observed in the application of Article 6.8. As India has
repeatedly argued
5, the last sentence of Article 6.8 makes it clear that Article 6.8 cannot be read in a
vacuum. The terms of Article 6.8 can only be understood and applied in light of Annex II. And the
phrase "all information which" meets the four conditions of Annex II, paragraph 3 has been
interpreted by the Appellate Body to require the use of such information.
10. Nor does the text of Article 6.8 authorize the application of "total facts available", i.e.
rejection of all of the information submitted by respondent. The text does not say that the final or
preliminary determination may be made on the basis of "total," "all" or "only" facts from the petition
or adverse facts. Rather, the text uses the expression "may be made on the basis of the facts
available" (emphasis added). This phrase does not mean that any information provided by the
respondent which meets the requirements of Annex II, paragraph 3 can be rejected if other
information submitted by a respondent does not meet these requirements. Read in the context of
Annex II, paragraph 3, the pool of "facts available" that can be used to make a preliminary or final
determination in Article 6.8 is limited to filling the gap for the piece or component of necessary
information that the respondent has not been able to supply consistent with Annex II, paragraphs 3
and 5. For that particular information, the pool of "available" facts would include facts from the
petition or from other available sources.

3 Ex. IND-31; figure based on publicly available data from US Customs Service.
4 Ex. IND-32.
5 India First Submission at paras. 50-79; India First Oral Statement paras. 25-43.

IV. USDOC COULD HAVE USED SAIL'S SUBMITTED US SALES DATA WITHOUT
UNDUE DIFFICULTY IN COMBINATION WITH INFORMATION IN THE
PETITION
A. PROPER INTERPRETATION OF THE TERM " UNDUE DIFFICULTY"
11. One of the key issues in this case is the proper interpretation of the phrase "can be used
without undue difficulty" in Annex II, paragraph 3. A key word in this phrase is "used." The ordinary
meaning of the term “used,” in the context of th e AD Agreement, is that the data are "used" to
establish a dumping margin.6 The entire purpose of collecting the necessary information (and, indeed,
in conducting a dumping investigation) from both the domestic industry and the interested foreign
parties is to "use" the information to determine if the product investigated is "introduced into the
commerce of another country at less than its normal value." 7 In the dumping phase of an
investigation, there is simply no other reason to collect the information, and no other "use" for the
information.8
12. The term "difficulty" suggests that the information at issue in an Annex II, paragraph 3
situation may not be perfect. If perfection were the requirement, then the text would not have
included the element of "difficulty." So, it can be presumed that if this criterion is at issue, there are
some difficulties in using the data that must be overcome through efforts of the investigating
authorities before it becomes “usable” for the purpose of calculating the dumping margins. These
difficulties could include gaps in the information submitted by the respondent -- for example, missing
data on freight expenses, missing product characteristics, missing cost data, incorrect customer
information, etc. These gaps in the submitted in formation are those that USDOC regularly “fills”
through the application of its “filling the gap” doctrine. Another issue that may require some effort on
the part of the investigating authorities before th e information is “usable” would be to account for
errors or revisions to data encountered at verification. For example, the documents reviewed at
verification may reveal that a particular freight expense amount is different from that reported in the
respondent’s questionnaire response. Or it may be discovered that certain customers were identified
with an incorrect level of trade. Or it may be determined that certain general expenses were
incorrectly allocated among home market, US, and third country sales. These items can generally be
handled by the investigating authority through revisions to, or the insertion of additional lines in, the
computer programme used to calculate the respondent’s margins.
13. Another key qualifier is the term "undue." The ordinary meaning of this term is “going
beyond what is warranted or natural, excessive, disproportionate.”
9 The importance of this word can
be seen by considering the text without it. If the text simply read "can be used without difficulty", the
text would require investigating authorities to ta ke efforts to use the verifiable and timely produced
information but to stop trying if any difficulty arose in their efforts to use the information. But with
the addition of the word "undue", the text suggests an even higher degree of effort is required on the
part of investigating authorities to use the verified (or verifiable) and timely produced information.

6 The information need only "contribute" to the calculation of a dumping margin because the entire
thrust of Annex II, paragraph 3 relates to "all information which" can be used to calculate a dumping margin --
not all information requested by investigating authorities (as argued incorrectly by the United States). See India
First Submission at paras. 56-67, India Oral Statement at the First Meeting of the Panel with the Parties ("First
Oral Statement") at XX.
7 AD Agreement Article 2.1.
8 The United States argues at paragraph 113 of its First Submission that information meeting the
requirement of Annex II, paragraph 3 "should be taken into account, although it need not be used to calculate a
margin." India finds it difficult to understand how information can be used in the sense of being "taken into
account" but then not used for the purpose of calculating a margin.
9 New Shorter Oxford English Dictionary, Clarendon Press 1993.

This includes, as discussed below, the requirement to use information that may not be perfect, or
information that may have to be combined with ot her data to become usable. This interpretation is
consistent with the disciplines in the AD Agreement: on the one hand, the Agreement sets minimum
standards for the information required in an ap plication, and on the other hand, the Agreement limits
the investigating authorities’ ability to use th at information to calculate dumping margins if
respondents have provided verified and timely produced information.10
14. India offers the following suggestions for criter ia to be used in interpreting the meaning of the
phrase "can be used without undue difficulty". Not all of these criteria may be applicable in every
case, but these criteria could be used to assess whether information that is already timely produced,
verified (or verifiable) and in the required computer format, can be used "without undue difficulty" to
contribute to the calculation of a dumping margin. These criteria are as follows:
(a) The extent to which the component/category/set of information requested is
complete;
(b) The extent and ease with which gaps in the information can be filled with other
available information in the record;
(c) The amount of information that is available to be used;
(d) The amount of time and effort required from the authorities to use the data in
calculating a dumping margin;
(e) The accuracy and reliability of alternative information that would be used if the
respondent's information were discarded.
15. We discuss each of these suggested criteria below.
16. ( a) Completeness of component/category/set of information: Investigating authorities
(including USDOC) request informa tion from interested foreign parties in components and sections.
The largest components are entire data sets for home market sales, export sales, cost of production,
and constructed value. However, data is frequently requested and provided in much smaller
groupings. One consideration in assessing "undue difficulty" is the completeness of the information
requested. The more complete the information, the easier it will be to use in connection with other
information to calculate the respondent’s margins. For example, SAIL's US sales database was
complete except for the VCOMU and TCOMU data used to calculate the "difmer" adjustment, which
in any event, as noted below, does not affect the calculation of US price. The US sales database
contained complete information on all 1284 of SAIL's US sales into the US market during the period
of investigation, including information regarding 26 different characteristics of SAIL's US sales,
including quantity shipped, prices, physical characteristics, movement expenses, credit expense, etc.
As described in section IV.E below, this US sales database was easily capable of being used to
contribute to the calculation of a dumping margin.
17. ( b) Extent the information can be used with other information: Another important
consideration is the extent to which the particular information can be combined with other
information to calculate a dumping margin. No part icular piece or category of information collected
in an investigation, standing alone, can be used to calculate a dumping margin. Rather, a dumping
margin can only be calculated by using this information in conjunction with other information
provided either by the respondent or from other sources, including the petition. SAIL's US database
can be used when combined with the NV data supplied in the petition – either the petition’s estimated

10 See India First Oral Statement, paragraphs 48-54.

home market prices (from a market research report submitted by petitioners) or its estimated
constructed value. Margins could easily be calculated from the combination of these sources of
information, as described in Mr. Hayes’ first affidavit and as he described further during the First
Meeting. If USDOC were to insist (unnecessarily, in India’s view) that a “difmer” adjustment must
be made to the NV before the NV could be compared to SAIL’s reported US sales database, the
information necessary to calculate a “difmer” adjustment is likewise to be found in the petition.
Further details regarding margin calculation options are found in Mr. Hayes’ second affidavit,
attached to this rebuttal brief as India Exhibit 34.
18. ( c) Amount of information available to be used : The amount of information available to be
used in calculating a dumping margin is a further criterion that could be considered in assessing undue
difficulty. If the information provided constitutes complete information, but it covers only a relatively
small aspect of the sales involved (such as brokerage fees, freight or credit expense), then the
administering authority would not be expected to spend a significant time attempting to correct any
errors or otherwise to use considerable efforts to make the information usable without undue
difficulty.
19. But if the information at issue is a largely complete set or category of information, then it
cannot be so easily ignored. If the information provided represents one entire component of an
equation that involves two components necessary to calculate a dumping margin, then investigating
authorities must take considerable steps to attempt to use this verified (or verifiable) and timely
produced information, before determining that they cannot use it.
20. In this case, SAIL's US sales information represented effectively the entire database required
in order to calculate the export price component ( one side) of the two-sided dumping calculation
equation. USDOC could therefore be expected to expend considerable efforts to use the database.
These efforts should be measured not only in terms of the number of hours of work involved, but also
in the flexibility of the efforts undertaken by USDOC to make the submitted data “usable” – for
example, as it did to overcome the missing “difmer” data in the Stainless Steel Bar from India case,
discussed in detail below.
21. ( d) Amount of time and effort required from investigating authorities: Another element that
could be considered in assessing "undue difficulty" is the amount of time and effort required by the
investigating authorities to use the information. As a general matter, the fewer or less complex the
changes required to correct or modify data, the easier the data would be to use. In the case of SAIL's
US database, the effort required to make the information usable in conjunction with information in the
petition does not involve very much time. As Mr. Hayes' Second Affidavit indicates, in the case of
each of the suggested methods for using SAIL's US sales data, he estimates it would take from
between a half-hour to three hours of an expe rienced USDOC analyst's time to calculate SAIL’s
margins. This is a very short period of time, compared to the thousands of hours demanded from
respondents for responding to anti-dumping questionnaires and collecting and formatting the
requested information.
22. ( e) Accuracy of alternative information if the information in question is not used: A final
factor to consider, in deciding whether information can be used without undue difficulty, is the quality
and accuracy of the alternative information in the petition, or other sources of information that would
be used in the event that the submitted data is disregarded. This analysis responds to the Panel's
question 33. The concept of "undue difficulties" must be read in light of the object and purpose of the
AD Agreement, which is to use the most accurate information possible in calculating a dumping
margin. The level of effort required to use information should be considered in connection with the
accuracy of alternative available information. If investigating authorities know that if they do not use
the verifiable and timely produced information from the respondents, they will instead use
information in the petition which is not verified and can not be corroborated by other information,

then they must use particular efforts to make the submitted information “usable”. The amount of
effort required from investigating authorities as well as the quality of the information that can be used
without undue difficulty may well differ in each case.
23. In the current case, USDOC knew that the single $251 per ton offer that was the basis of the
export price in the petition never resulted in a sale, and was $100 less per ton than the average unit
value of the US Customs data against which USDOC claimed to have corroborated that offer. 11 India
submits that in these circumstances USDOC was obligated to use particular efforts to make SAIL's
US sales data usable to calculate its margins. The situation here is especially stark because USDOC
made no efforts to use SAIL’s US sales informa tion, despite the fact that USDOC concluded in its
Final Determination that the information could be "used" with some minor corrections to the database.
24. In conclusion, the determination of whether verifiable and timely produced information is
usable “without undue difficulty” is a critical stage of the process by which an investigating authority
calculates a respondent’s margins. It demands significant cooperation and effort on the part of
investigating authorities. It requires that they undertake efforts to use the information submitted by a
respondent, including seeking ways to use the information, if necessary, in conjunction with other
information. It also requires investigating officials to make corrections in data and to request and
obtain information from respondents needed to make such corrections.
B. THE PANEL SHOULD REJECT THE UNITED STATES' ATTEMPT TO HAVE THE
PANEL CONDUCT A DE NOVO EVALUATION OF THE FACTS REGARDING THE
USABILITY OF SAIL'S US DATABASE
25. During the First Meeting of the Panel with the parties, the United States raised for the first
time a new argument that India's US sales data was not usable to calculate a dumping margin because
of problems that spilled over from India's cost databa se. In particular, the United States asserted that
the absence of cost information from which a “difmer” adjustment could be calculated on SAIL’s US
sales made all of SAIL's US export price data unusable to calculate a margin. The Panel should reject
the new US “difmer” argument on the merits, if the Panel considers it must address that argument’s
merits in order not to leave a void in the event of an appeal. However, first and foremost the Panel
should reject the United States’ new argument as an attempt to have the Panel make a de novo finding
that SAIL's US sales data are not "usable." Fundamental systemic considerations for the WTO dispute
resolution process, far more important than this case standing alone, compel such a finding by the
Panel.
1. Relevant facts
26. The facts relevant to India's objection based on AD Article 17.6(i) are described below.
Because section 782(e) of the US anti-dumping statute contains three of the conditions of Annex II,
paragraph 3 (as well as two others), SAIL's arguments before the USDOC on the "usability" of SAIL's
US database were very similar to the arguments advanced by India before this Panel. Five weeks
before USDOC issued its final determination on 29 December 1999, SAIL's counsel presented oral
arguments to USDOC. After discussing the width error in the data and the extensive and successful
verification process regarding SAIL's US sales database, SAIL's counsel made the following
statement:
It would be unreasonable and irrational for the Department, in any context -- in this
case or in any other case -- for the Department to knowingly say, well, let's use
information that we know is wrong in place of information that we know and we have
verified to be correct. But that is, in essence, what you are being urged to do here.

11 See Ex. IND-8 (public version), Ex. IND-31 (public version).

You're being asked to use the Petitioner's -- clearly and, I think, beyond doubt --
inaccurate estimate of US sales data in place of the actual US sales information that
you know, without question, is accurate, timely, and verified. I do not think the
Department or any other government agen cy can say, even though we know the
answer is four, we are going to say that two plus two equals five. But that is, in
effect, what you're being asked to do, to submit something you know is incorrect for
information that you know is verified without question to be accurate.
'The basic purpose . . . of the [US] anti-dumping law is to calculate dumping margins
as accurately as possible.' . . . All the authorities that we have referred to in our brief
are clear, that with respect to discrete, particular pieces of information, such as the US
sales database that we submitted, if the information is timely, if it is verified, if it is
complete, if it is submitted with that party's best of its ability, and if it can be used
without any undue difficulties, then the Department is required to use it. It is another
way of saying, the Department is required to act rationally.
12
27. In addition, SAIL's counsel proposed to USDOC that one method for calculating a margin
was "based on [SAIL's submitted] information and US sales list and the constructed value information
based on the petition."
13 In SAIL's case and rebuttal briefs to USDOC dated 12 and
18 November 1999, SAIL repeated the arguments th at the information in SAIL's US database,
standing alone, was verified and could be used by the Department in its final determination. In its
submission of 12 November, SAIL made the following arguments:
Were the Department to use information other than SAIL's home-market sales and
cost data, it would be appropriate for the Department to calculate the dumping margin
using (1) the verified US sales data submitted by SAIL and (2) the average of the
normal value and constructed value alleged in the Petition. Alternatively, the
Department might reasonably calculate the dumping margin by using (1) the verified
US sales data submitted by SAIL and (2) the single largest home-market sale by
value of [ ], the home-market product that is the "most similar" product for over [
] per cent of [ ]. What the Department cannot do is ignore the verified US sales
data submitted by SAIL and use in its stead the US sales price information alleged in
the Petition. The US sales price alleged in the Petition is unquestionably much less
accurate than the verified US sales data submitted by SAIL. Accordingly, the
Department is required to use SAIL's US sales data when calculating SAIL's dumping
margin.
14
28. Thus, at the time that USDOC issued its Final Determination on 29 December 1999, the issue
of exactly how SAIL's US sales data could be used by USDOC was squarely before it.
29. The Final Determination evaluated the facts regarding SAIL's US database as follows:
Finally, with respect to section 782(e)(5), the US sales database contained errors that,
while in isolation were susceptible to correction , however when combined with the
other pervasive flaws in SAIL's data le ad us to conclude that SAIL's data on the
whole is unreliable.15

12 Ex. IND-15 at 28-30.
13 Id. at 54-56.
14 Ex. IND-14 at 14-15 (November 12, 1999) (emphasis in original).
15 Ex. IND-17 at 73127 (emphasis added).

Furthermore, we disagree with SAIL's characterization of its US sales as accurate,
timely, and verified. In fact, the US sales database contained certain errors, as
revealed at verification. See Sales Report; see also Verification Memo.16
Yet SAIL has not provided a useable home market sales database, cost of production
database, or constructed value database. Moreover, the US sales database would
require some revisions and corrections in order to be useable.
17
30. Thus, USDOC focused its evaluation of th e facts regarding SAIL's US sales data on two
aspects -- the errors ("revisions and corrections") that were found in SAIL's database and the useable
nature of that database. As set forth in USDOC’s Sales Verification Report, and its Memorandum on
Verification Failure, the only error that rose to the level of a “significant” issue was the width coding
error which Mr. Hayes has indicated would take a short amount of time to correct, and for which
USDOC had all the corrected information as set out in Exhibit S-8 of its Verification Report. Indeed,
given that this was the only error USDOC considered "significant,” it properly stated in the Final
Determination that, inter alia, SAIL’s US sales database was "susceptible to correction."
31. USDOC also stated in the Final Determinat ion that SAIL's US sales database "would require
some revisions and corrections in order to be useable." India notes the inter-related nature of these
two statements, i.e., that the "revisions and corrections" were "susceptible to correction." Contrary to
the United States’ new assertions, nothing in the Final Determination states that the US sales database
needed "additions" in order to be usable. Nor does the Final Determination suggest that the US sales
database was infirm because of missing data required to calculate a “difmer” adjustment. It is
significant that USDOC did not make any such assertion despite the fact that SAIL had proposed
several methodologies in its case brief on 12 November 1999 that would have combined SAIL's US
sales data with the information on constructed value in the petition. This is exactly the same basic
methodology that India has proposed to the Panel since its First Submission and which it continues to
assert would be an appropriate method to calculate SAIL’s margins in this case.
32. The United States raised the “difmer” issue for the very first time at the First Meeting of the
Panel with the parties in January 2002. In orally responding then to India’s objection that this was a
new argument not found in the record or in the Fi nal Determination, the United States stated it was
making the argument because of calculations made by Mr. Hayes in his affidavit. But the
methodology proposed by Mr. Hayes for calculating a dumping margin was exactly the same as that
proposed two years earlier by SAIL before USDOC -- to combine SAIL's actual US sales data with
the data in the petition on normal value.
33. A plain reading of the Final Determination shows that the United States’ argument that the
lack of “difmer” data undermines the usability of SAIL’s US sales database is a new evaluation of the
facts in the record generated post hoc by USDOC. But this new evaluation is directly at odds with its
own evaluation in the Final Determination that the database was "useable" if "some revisions and
corrections" were made, and its acknowledgement in the same Final Determination that the errors in
SAIL’s US sales database were "susceptible to correction."
2. Legal analysis
34. As the United States has argued in this dispute, AD Article 17.6 precludes panels from
conducting de novo evaluation of the facts.
18 Yet the new argument by the United States, in effect,
either asks the panel to conduct a de novo review of USDOC's evaluation of the facts − by asking the

16 Ex. IND-17 at 73130.
17 Ex. IND-17 at 73130 (emphasis added).
18 Oral Statement of the United States, First Meeting of the Panel, para. 2.

panel to find that SAIL's US sales database can not be used by USDOC at all − or admits that the
USDOC actually reached its decisions during the inve stigation for reasons not reflected in its final
determination. GATT and WTO panels have rightly found such arguments unacceptable. For instance,
the panel on Korea – Anti-Dumping Duties on Imports of Po lyacetal Resins from the United States
rejected an attempt by Korea to justify an injury determination by reference to considerations not
reflected in the public statement of reasons accompanying the determination:
An explanation of how in a given case investigating authorities had evaluated the
factual evidence before them pertaining to the factors to be considered under Article 3
[of the Tokyo Round Anti-Dumping Agreement] clearly fell within the scope of the
requirement in Article 8:5 that authorities articulate in a public notice "the findings
and conclusions reached on all issues of fact and law considered material by the
investigating authorities, and the reasons and basis therefor." This provision served
the important purpose of transparency by requiring duly motivated public decisions as
the basis for the imposition of anti-dumping duties. In the view of the Panel, the
purpose of this provision would be frustrated if in a dispute settlement proceeding
under Article 15 of the Agreement a Party were allowed to defend a challenged injury
determination by reference to alleged reasons for such determination which were not
part of a public statement of reasons accompanying that determination. The Panel
therefore did not accept Korea's argument that the Agreement did not limit an
investigating authority's ability to demonstr ate that it considered all of the required
factors, and to demonstrate that dumped imports caused material injury, to the text of
the public notice which announced its determination.
Furthermore, for a panel to review a determ ination by reference to considerations not
actually reflected in a public statement of reasons accompanying such determination
would also be inconsistent with the requirements of an orderly and efficient conduct
of the dispute settlement process under Article 15. A full and public statement of
reasons underlying an affirmative determination at the time of that determination
enabled Parties to the Agreement to assess whether recourse to the dispute settlement
mechanism under Article 15 was appropriate and provided a basis for a delimitation
of the object of such dispute settlement proceedings. In this connection the Panel
noted that, in light of the wording of the public notice given by the Korean authorities
at the time of the imposition of the anti-dumping duties, Parties to the Agreement and
exporters affected by these measures had no reason to believe that the injury
determination of the KTC was based on considerations not reflected in that notice.
 19
35. One of India's claims in this matter focuses entirely on the fact that the Final Determination is
inconsistent with, inter alia, Annex II, paragraph 3 of the AD Agreement. Another is that USDOC
made an unfair comparison between export price and normal value. As the Panel can see from India’s
panel request, from its First Submission, and from its Oral Statement to the Panel on 23 January 2002,
India has focused its arguments on the fact that SAIL's US sales database should have been used by
USDOC because while it contained minor errors, USDOC itself had admitted that these were
"susceptible to correction" and USDOC itself had indicated that the information was "useable" if
those corrections were made. India made the decision to bring this case to this Panel, in part, because
of these findings and evaluations of facts by US DOC regarding the quality of SAIL's US sales
database. USDOC is estopped from now claiming a different reason for its determination than that
which appeared in the Final Determination.
36. AD Agreement Article 17.6(i) requires that in assessing the facts of the matter, a panel "shall
determine whether the authorities’ establishment of the facts was proper and whether their evaluation

19 ADP/92, adopted 27 April 1993, BISD 40S/205, 275-276, paras. 209-10 (footnote 19 omitted).

of those facts was unbiased and objective." The use of the past tense in this sentence indicates it is
focused on an "evaluation" that has already occurred. The "evaluation" of the facts established during
an anti-dumping investigation is reflected in the Final Determination. It does not take place two years
after the Final Determination has been issued.
37. The context for this interpretation of Article 17.6(i) is Article 12.2 of the AD Agreement
requiring that public notice of any final determination must "set forth, or otherwise make available
through a separate report, in sufficient detail the findings and conclusions reached on all issues of fact
and law considered material by the investigating authorities." In other words, the "evaluation" of facts
by an investigating authority may not be modified once the Final Determination is issued. Additional
context is provided by Annex II, paragraph 6, which states that "the reasons for the rejection of such
evidence or information should be given in any published determinations." These reasons and the
evaluation of the facts simply cannot be performed post hoc to create different factual evaluations
where an investigating authority has already made an evaluation of a particular fact and provided
reasons for the rejection of the data.
38. Another relevant legal authority is the panel report in United States - Measure Affecting
Imports of Woven Wool Shirts and Blouses from India , WT/DS33/R where the panel stressed that it
could not conduct a de novo review of the evidence before the US textile authorities. In that case, the
United States attempted to introduce with its first written submission an Annex setting forth the
"relevant evidence" applicable to a USDOC final de termination in a textile transitional safeguard
investigation.
20 This Annex contained additional facts and explanations regarding the final
determination issued by US textile officials. In its findings, the panel repeatedly declined to accept
this post hoc evidence and explanations offered by the United States. 21 Instead, the panel relied only
on the evaluation of the facts contained in the final determination.
39. This is not the first time that the United States has been confronted in WTO proceedings with
an allegation that it was attempting to introduce into the record post hoc findings. In the Korean Line
Pipe dispute, Korea argued that the United States had presented new arguments on certain issues
regarding the WTO compatibility of the final safeguard measure which had not been found in the US
notices or decision memoranda regarding the safeguard. In responding to this argument, the
United States made the following statement:
Of course, one way Korea might prevail is if the United States were precluded from
presenting a defense . . . As Korea has acknowledged, arguments concerning
consistency with WTO obligations were not an issue in the domestic proceeding.
Therefore the absence of any arguments concerning WTO consistency in the notices
is not surprising. A rationale that was never required in the first place is not post
hoc.”22
40. Assuming for the sake of argument that India agrees with the latter statement by the
United States, there can be no doubt that in the current case, USDOC was presented with arguments
during the investigation concerning the usability of SAIL's US database. And the language of
subsections 782(e) (1), (2), and (5) of the US anti-dumping statute largely track the language of
Annex II, paragraph 3. There is no question that the issues before USDOC, while conducted under
US law, involved the same "facts available" issues (and evidence) that India has presented to this
Panel.
23 Therefore, US law and the WTO rules both required the United States to make a finding
regarding the usability of SAIL's US sales data. USDOC's only finding in this regard is quoted above.

20 WT/DS33/R at para. 7.33.
21 Id. at paras. 7.33, 7.37, 7.40, 7.41, 7.44.
22 WT/DS/179/R at 333, para. 4 (emphasis added).
23 See Ex. IND-15.

Having made that evaluation of the facts, the United States must accept it -- not seek to change it.
Alternatively, to the extent the Panel finds that USDOC did not make any finding on the usability of
SAIL's data to calculate a dumping margin, USDOC cannot now post hoc develop and introduce a
new evaluation of the facts to support the conclusion that it could not use that data at the time of its
Final Determination.
41. India does not contest the evaluation of the facts by USDOC that "the US sales database
would require some revisions and corrections in order to be useable." In fact, the “revisions and
corrections” contemplated by this statement are the kinds of corrections and revisions that USDOC
routinely makes to data submitted by interested foreign parties (see Section IV.D infra). Nor does
India contest the evaluation of the facts by USDOC that the revisions and corrections needed to be
made to SAIL's US database "in isolation were susceptible to correction . . .". Mr. Hayes has
demonstrated exactly how "susceptible to correction" these errors were.
42. However, India strongly opposes the United States' attempt to have this Panel conduct a de
novo evaluation on these particular aspects of USDOC's original evaluation. This is simply not
permitted by AD Agreement 17.6. The United States cannot have it both ways; it cannot insist that
the Panel apply a very narrow standard of review under Article 17.6(i) for those findings it wishes to
be upheld, and then argue for the Panel to accept a new evaluation of the findings it would like to
change or supplement. Accordingly, in conductin g its review of India's claims under AD Agreement
17.6, this Panel should find, in accordance with the Final Determination, that (1) SAIL's US database
contained errors that were susceptible of correction, and (2) that SAIL's US database could be used by
USDOC if some corrections and revisions were made.
43. Finally, India urges the Panel to find in the alternative that it rejects the US “difmer”
arguments on the merits− even if the Panel agrees with India's arguments above under Article 17.6− in
order to avoid a legal vacuum in the event of an appeal. India presents evidence below demonstrating
that no unbiased and objective investigating authority could have concluded that SAIL's US sales data
was not usable. This evidence demonstrates that SAIL's US sales database -- either in part or in full -
can be used in a number of methods to calculate a dumping margin when combined with information
in the petition. This analysis is detailed below and in Mr. Hayes’ Second Affidavit.
C. THE UNITED STATES ERRS IN ASSERTING THAT THE LACK OF VERIFIED COST
DATA RENDERED SAIL’S US SALES DATABASE UNUSABLE, BECAUSE THE
COST DATA ARE USED ONLY TO CALCULATE AN ADJUSTMENT TO NORMAL
VALUE
44. There is a good reason why USDOC did not take the position during the administrative
proceedings or in its Final Determination that the United States has now attempted to raise before the
Panel – i.e., that the absence of verified cost data rendered SAIL’s US sales database unusable. Put
simply, it is because such an assertion suggests an interaction between cost data and the US sales
database that is contrary to US law.
45. Specifically, the adjustment for which the missing cost data is used – the so-called “difference
in merchandise” (or “difmer”) adjustment – is required by US law to be an adjustment only to normal
value, not US price . Thus, although USDOC requires respondents to include two cost-based data
fields in the US sales database, these fields are only used, as discussed below, in the calculation of
normal value. In the current case, however, USDOC has already rejected SAIL’s NV data (based on
both submitted home market sales prices and costs of production). The fact that there may be yet
another reason why SAIL's submitted NV data is unusable – the inability to calculate a difmer
adjustment on the basis of submitted cost data – can have no effect on the outcome of this case. More
importantly for the issue at hand, the inability to calculate a difmer adjustment to NV cannot have any

effect on the usability of SAIL’s US sales database for the purpose of calculating US prices on which
margins can be based. We review this reasoning in greater detail below.
46. The United States’ argument is that the verification failure of SAIL’s cost of production
database means that there is an absence of data for two fields in the US sales database – variable and
total cost of manufacture (often referred to by their computer field names, VCOMU and TCOMU).
As was discussed during the First Meeting, these two data fields are used for one purpose – to
calculate a so-called “difference in merchandise” adjustment that is authorized by the Agreement and
US law when a margin is calculated through the comparison of merchandise in the US and home
markets that is not identical. Although the Agreement and US law both authorize such an adjustment,
neither specifies the manner in which the adjustment is to be calculated. The Agreement, for
example, simply notes in Article 2.4 that “Due allowance shall be made in each case, on its merits, for
differences which affect price comparability, including differences in . . . physical characteristics . . ..”
USDOC’s practice has been to calculate the adjustment on the basis of the difference in the variable
cost of manufacture of the specific models that are being compared in the US and home markets
(VCOMU and VCOMH).
47. The US anti-dumping statute provides very precisely for the place in the dumping margin
calculation in which the difmer adjustment is to be applied – and that place is in the calculation of
NV, not US price. Specifically, subsection 773 of the Trade Act of 1930 as amended (19 U.S.C. §
1677b) governs the calculation of normal value. Subsection (a)(6) of that statutory provision states:
Section 773. Normal Value.
(a) . . .
(6) ADJUSTMENTS.-The price [on which NV is based] described in paragraph
(1)(B) shall be-

(C) increased or decreased by the amount of any difference (or lack thereof) between
the export price or constructed export price and the [normal value] price described in
paragraph (1)(B)(other than a difference for which allowance is otherwise provided
under this section) that is established to the satisfaction of the administering authority
to be wholly or partly due to-

(ii) the fact that merchandise described in subparagraph (B) or (C) of section 771(16)
is used in determining normal value . . . .
48. In other words, the statute provides that an adjustment is to be made to the price on which
normal value is based, if the merchandise used to determine NV is merchandise described in
subparagraphs (B) and (C) of section 771(16) (19 U.S.C. §1677(16)). Those subsections, in turn,
describe the merchandise, other than identical merchandise, that may serve as a basis for comparison
in calculating dumping margins. Thus, when NV is based on different merchandise (hence, “difmer”)
from the merchandise sold in the United States that is the basis of export price, the statute authorizes
an adjustment – but that adjustment can only be made to the NV side of the calculation.
49. On the basis of this unambiguous statutory directive, USDOC’s uniform practice has been to
apply the difmer adjustment factor calculated as described above to the adjusted NV of the model sold

in the home market. 24 Conversely, under USDOC practice as mandated by the statute above, the
difmer adjustment has no bearing at all on the calculation of the US price of the model to which that
home market model is matched. For this very basic reason, the United States’ assertion that the lack of
verified cost data on which a difmer adjustme nt could be calculated somehow undermines the
usability of SAIL’s US sales database, is simply incorrect.
D. USDOC COMMONLY FILLS GAPS THAT ARE SIMILAR IN SCOPE TO THE MISSING
COST DATA IDENTIFIED BY THE UNITED STATES IN SAIL’S DATABASE
50. Even accepting the United States’ argument that the unusable VCOMU and TCOMU data
somehow infected the US sales database, it should be recalled that these are only two fields of
information in a database of almost 30. The United States has argued to the Panel that the lack of
information in these two cost fields renders the US sales database unusable in its entirety, but that
simply is not correct. USDOC itself has developed the concept of “filling gaps” in a database, as an
exercise of “partial facts available,” when necessary to calculate dumping margins. In these cases,
USDOC has determined that the magnitude of the gaps (i.e., the missing information) is not so large
that it undermines the usability of the database involved. The United States in the current case has
argued that the gaps here are too large to be filled through the application of the “filling the gap”
doctrine, but in fact the situation in this case is similar to others in which USDOC has done so.
51. For example, in Stainless Steel Bar From India , USDOC rejected the home market sales
database of one respondent (Viraj) entirely because it was found to be “incomplete and could not
serve as a reliable basis for the calculation of normal value.”
25 USDOC instead used the respondent’s
submitted database in which it reported sales to third country markets as the basis for NV. USDOC
noted that the third country sales database was “lacking” in one respect – namely, the failure to report
usable VCOM data. However, unlike the current case, USDOC did not conclude that the lack of
usable VCOM data rendered the entire database unusable. To the contrary, it worked creatively with
the respondent’s submitted information in order to deal with the missing VCOM data in the third
country database – specifically, by “band[ing] the company’s sales of different stainless steel bar sizes
in order to obtain more identical matches.”
26 In other words, USDOC redefined what comprised a
“product” to expand the scope of “identical” merchandise. And as discussed in detail above, no
“difmer” adjustment is applied to matches of identical merchandise, so by revising its definition of
“identical” merchandise to ensure that all US products are matched as identical to home market
products, USDOC renders the lack of reported VCOM data moot.
52. Moreover, in Stainless Steel Bar from India (as in this case), not all products could be
matched on an identical basis. But this did not stop USDOC from using the data. Instead, USDOC
continued to make efforts to use even this data noting that “[i]n those instances where the banding of
sizes did not produce an identical match for a US sale, we have, as facts available, assigned the “all
others” rate established in the . . . investigation.”
27
53. USDOC’s acceptance of the respondent’s database in Stainless Steel Bar from India as a basis
for calculating margins despite the absence of VC OM data in that database shows how USDOC (or
other investigating authorities) can use such data without undue difficulty. As Mr. Hayes’ second
affidavit describes, a number of methodologies could have been used by USDOC to deal with the
lack of usable difmer data, had USDOC desired to make use of them. It is simply incorrect for the

24 See Mr. Hayes’ Second Affidavit, para. 3.
25 Stainless Steel Bar From India: Final Results of Anti-dumping Duty Administrative Review and
New Shipper Review and Partial Rescission of Administrative Review, 65 Fed. Reg. 48965 (10 August 2000)
(Decision Memorandum, comment 4) (attached hereto in Ex. IND-35).
26 Id.
27 Id.

United States now to claim that in this case the lack of the same d i f m e r d a t a i n S A I L ’ s U S s a l e s
database rendered it unusable for calculating SAIL’s margins.
54. USDOC applied its “filling the gap” methodology in many other cases of equal scope. For
example, Hot-Rolled Flat-Rolled Carbon-Quality Steel Products From the Russian Federation
involved a “non-market economy” country, requiring that NV be based on the respondent’s “factors
of production.” The respondent was not able to report factors of production on a product-specific
basis because of “limitations of its accounting system,” 28 and it “failed to develop a reasonable
allocation methodology for purposes of this proceeding and instead reported” factors of production
based on its records in the normal course of business.29 As a result, USDOC rejected the NV database
as submitted by the respondent. However, this decision did not lead USDOC to apply adverse facts
available or to rely on the petition as the basis for NV. Instead, despite its concerns regarding the
usability of the respondent’s submitted NV data, USDOC retained the factors of production
information submitted by the respondent, and used it to calculate a single weighted average NV, to
which it compared all US prices.
30
55. Likewise, in Certain Circular Welded Carbon Pipe and Tubes from Taiwan , one of the
respondents failed to provide COP and CV information for some of the models sold in the
United States and home market. USDOC did not conclude that this missing data undermined the
validity of the entire COP and CV databases, but rather filled the gap by inserting for those models the
highest average cost of models for which the respondent did provide data. USDOC noted that it was
applying “adverse” facts available in doing so, and it rejected the respondent’s arguments that it
should have used a more “neutral” approach to filling the gap.
31 But USDOC did not assert that it
should reject the databases entirely or that the missing information in the COP and CV databases
undermined the validity of the other databases (US sales and home market sales).
56. In conclusion, India notes that there ar e many other cases where USDOC has filled gaps
similar to those at issue in this dispute. It will supply additional citations to USDOC decisions if the
Panel so requires. The point made is that these decisions illustrate that if USDOC has the will to use
the information in calculating a dumping margin -- it can and will find the ways to do so without any
undue difficulty.
E. THERE ARE NUMEROUS METHODS THROUGH WHICH USDOC COULD HAVE
USED SAIL'S US SALES INFORMATION TO CALCULATE SAIL’S MARGINS
57. Contrary to the United States’ assertions, a broad range of methods exist by which it could
have calculated SAIL’s margins using its verified US sales database and NV information from the
petition. Several of these methods are set out in detail in Mr. Hayes’ Second Affidavit, attached
hereto as Exhibit IND-34, and India reviews them below. However, a few introductory points should
be noted. First, each of these methods is easy to implement – i.e., employing them, the US sales
database is usable “without undue difficulty.” Mr. Hayes estimates that none of them would take
more than a few hours for an experienced USDOC analyst to draft and input the necessary computer
programming language, to run the margins, and to evaluate the results.

28 Notice of Final Determination of Sales at Less Than Fair Value: Hot-Rolled Flat-Rolled Carbon-
Quality Steel Products From the Russian Federation, 64 Fed. Reg. 38626, 38629-30 (19 July 1999) (attached
hereto in Ex. IND-35).
29 Id. at 38635.
30 Id. at 38630.
31 Certain Circular Welded Carbon Steel Pipes and Tubes From Taiwan: Final Results of Antidumping
Duty Administrative Review, 64 Fed. Reg. 69488, 69489-90 (13 December 1999) (attached hereto in Ex.IND-
35).

58. Second, some of the methods are very similar to that used by the petition and adopted by
USDOC – i.e., comparing US price with CV data in the petition. The only difference is that these
proposed methods use SAIL’s actual submitted, verified US sales data, instead of the price offer in the
petition, which was known to be grossly inaccurate. And in adopting the petition’s margin, USDOC
did not express any concern regarding the fact that the petition did not account for the lack of
“difmer” adjustment data in the petition’s estimate of US price. Thus, there should be no reason why
that factor has any relevance to the use of the alternative methodologies described below. However,
the lack of “difmer” adjustment data was overcome by USDOC in Stainless Steel Bar From India, and
a methodology such as was used in that case could be employed here as well, to overcome any
lingering concerns regarding the lack of difmer adjustment data in this case.
59. The CV in the petition was based on the cost of producing certain cut-to-length carbon steel
merchandise. As set forth in Mr. Hayes' Second Af fidavit, a substantial proportion - 30 percent - of
cut-to-length plate shipped by SAIL to the United States during the period of investigation was of the
same merchandise as that for which the petition calculated CV.
32 For the transactions involving these
shipments, the absence of cost information from which a “difmer” adjustment could be calculated
would be irrelevant, because no such adjustment need be applied to matches of “identical”
merchandise.
60. Thus, one alternative method by which USDOC could calculate the margins using SAIL’s
verified US sales database would be simply to calculate the margins on those products for which an
“identical” match exists between that database and the products on which the petition calculated
NV.
33 The weighted average margin could then be appl ied to all of SAIL’s US sales, including those
for which there was no direct match to NV. This method would obviate the need for a difmer
adjustment. It is also the method used by the petition and adopted by USDOC, but instead of using
SAIL’s actual verified data, USDOC used a fictitious price in the only price offer in the petition as the
basis of US price. It is hard to understand why that method would be less accurate if the margin were
calculated on the basis of SAIL’s actual verified US sales data, as opposed to the inaccurate and
fictitious price offer in the petition.
34
61. Another option, which is closely similar to the first, would be to calculate the margins using
all of SAIL’s US sales transactions by calculating the weighted average USP for all the transactions
on the basis of the information submitted in SAIL’s US sales database, and comparing those USPs to
the petition’s CV. This methodology is the same as that shown in India’s Exhibit 33, which
Mr. Hayes presented to the Panel during the first day of the First Meeting. Although this option does
not account for a “difmer” adjustment, it is very similar to the methodology applied by the petition
and adopted by USDOC, again, without any apparent concern as to the lack of such an adjustment.
62. Yet another option would be to calculate the simple average NV from the two calculations
shown in the petition (i.e., the price-based NV from the home market research report, shown in
Figure 2 of the public version of the petition, and the CV-based NV). The prices for all the US
transactions involving identical merchandise would be calculated on the basis of the information
submitted in SAIL’s US sales database. Those US prices would then be compared to the NV figure,
to obtain the margins for the vast majority of SAIL’s US sales. Given that only identical matches are
involved, the absence of data on which a “difmer” adjustment could be calculated is moot under this
option.
35

32 See Mr. Hayes’ Second Affidavit (Ex. IND-34), para. 5.
33 The details of this option are presented in Mr. Hayes’ Second Affidavit (Ex. IND-34), para. 7.
34 More complex versions of this option are presented in paragraphs 12-13 of Mr. Hayes’ Second
Affidavit.
35 See Mr. Hayes’ Second Affidavit, para. 9.

63. Another possible methodology would be based on USDOC’s determination in Stainless Bar
from India, discussed in paragraph 51-53 above. USDOC could expand the definition of a “product”
in the current case, by “banding together” products into larger groups. For example, this could involve
comparing the US prices of all of SAIL’s merchandise that is of the identical grade of steel and within
plus or minus 0.5 inches (13 millimetres) in thickness as that of the petition’s CV merchandise to the
petition’s CV-based NV of $372. Again, it would be unnecessary to perform a “difmer” adjustment
to NV, and margins would be calculated for a substantial majority of SAIL’s shipments. For the
remainder of SAIL’s US sales, USDOC could apply the calculated margin, which is the same method
by which the petition and USDOC applied a margin to SAIL’s unmatched US sales, as noted at the
end of paragraph 64 above.
36
64. Finally, another option would be a variation on the first described above (in paragraph 63), in
which, for the small quantity of SAIL’s remaining, unmatched US sales, the Department would
simply apply the highest margin calculated on the US sales whose margin is calculated using the CV
as NV. A single weighted-average margin could then be calculated over all of SAIL’s US sales by
weight averaging the transaction margins calculated above.
37
V. NO UNBIASED AND OBJECTIVE INVESTIGATING AUTHORITY COULD HAVE
CONCLUDED THAT SAIL'S SUBMITTED US SALES INFORMATION WAS NOT
VERIFIABLE
65. The Panel has raised questions concerning the meaning of the term "verifiable" in the
Agreement during the first meeting of the Panel with the parties and in various questions to India.
The United States suggested at the first meeting that SAIL’s US sales data were not verifiable. India
disagrees with this argument, and describes below the meaning of the terms "verifiable", "verified",
and "not verified". India also supplements arguments it made in its First Submission and during the
first meeting of the panel with the parties to demonstrate how USDOC itself "verified" a considerable
amount of SAIL's US sales data during the verification process.
A. MEANING OF THE TERM "VERIFIABLE"
66. The term "verifiable" means "the fact of being capable of verification."
38 Section 782(e)(1) of
the US anti-dumping statute uses the phrase “can be verified” to express this element of Annex II,
paragraph 3. As India has explained, the term "verification", in turn, means the "action of
establishing or testing the accuracy or correctness of something, esp. by investigation or by
comparison of data."
39
67. This definition leaves unanswered the process by which the verification takes place. An
insight into the appropriate process is found in Annex I, paragraph 7, providing that the "main purpose
of the on-the-spot investigation is to verify information provided or to obtain further details." A
reasonable interpretation of the phrase "on-the-spot" verification is not that the investigating
authorities visit every conceivable facility where source documents may be found, nor do they
identify and examine every relevant source document and check every piece of submitted
information. It would impossible for investigating authorities to examine every piece of information
within any remotely realistic timeframe for comp leting the investigation. Instead, the on-the-spot
verification functions like an "audit," by which the investigating authorities test samples of the
information submitted by the respondent against source documents maintained by the company in the
normal course of business, in particular the financial statements that have been subject to review by

36 See Mr. Hayes’ Second Affidavit, para. 10.
37 See id. paragraph 11.
38 New Shorter Oxford English Dictionary, Clarendon Press 1993.
39 India First Submission, para. 57.

independent third parties. Thus, it is reasonable for them examine ( i.e., verify) sufficient selected
information in order to be in the position to judge the verifiability of the information they do not
affirmatively check.
68. The process of assessing whether information is "verifiable" requires an objective and
unbiased investigating authority to examine a va riety of different source documents (financial
statements, ledgers of various types (general, sales, cost), production records, invoices, contracts, bills
of lading, etc.) within a particular “component” of information (such as export sales or cost of
production). If those source documents for indivi dual transactions or production processes --
examined on a “spot” basis -- are accurately reflected in the information submitted by the respondent
to the investigating authority, then an objective and unbiased authority would conclude that other
information submitted by the respondent are "verifiable."
69. An important aspect of the process of the verification exercise is to examine the verifiability
(i.e., the accuracy and reliability of the information) of a particular piece or component of information
(such as export sales, home market sales, or cost of production). This is a legal requirement flowing
from the text of Annex II, paragraph 3, which states that "all information which is. . . verifiable" must
be used in the calculation of dumping margins. It would not be consistent with this provision to access
the verifiability of a particular piece of information based on the reliability or completeness of another
piece or category of information.
70. As India has described in detail in answers to Panel's question 28 and 29, verifications are
performed, as they were in underlying investigation of SAIL, by verifying the separate components of
information. As India explained in these answers, one of the main reasons for such a separation is the
manner in which the source documentation from the different categories is created, maintained, and
used in the normal course of business by separate people within a company in separate facilities for
separate purposes. For example, the export pr ice computer database submitted by SAIL on
17 August 1999 was verified by examining a large number of documents relevant to numerous
individual export sales transact ions. USDOC felt it was necessary to undertake this exhaustive
process in order to ensure not merely that the specific pieces of information reviewed were “verified”,
but also thereby that the entire US sales database, including the other, non-examined data, was
“verifiable”. But in conducting this exercise, USDOC's verification report does not indicate that it
compared SAIL's cost of production source documen ts to check the verifiability of SAIL's export
sales. This would make no sense. Thus, based on both logic and legal requirement of Annex II,
paragraph 3, conclusions concerning the verifiability of information must take place within the
particular component of information undergoing the verification process.
71. The quantity of information that is affirmatively examined will vary in different cases. In this
sense, most information submitted by a respondent remains "verifiable" (not "verified") during the
investigation because as a practical matter, only a small proportion of the information is manually
examined against source documents. In some cases, such as SAIL's US sales data, authorities will
examine a great deal of information. However, even if a small quantity of information is examined,
investigating authorities, using proper sampling techniques, may well be in the position to make an
appropriate assessment concerning the overall verifiability of the component of information
submitted.
72. How can information within such a component be determined to be "verifiable”? India
suggests that a reasonable process based on existi ng USDOC verification procedures would include
the following circumstances:
1. The auditor (verifier) is provided with source information (original documentation
such as financial statements, ledgers, bills of lading, sales records, invoices, bank

statements, freight documentation, etc.) to examine against the information reported
by the respondent (most probably in a computer database);
2. The examination of these source documents reveals no significant systemic problems
with reporting, accuracy, completeness, or reliability of the reported information;
3. Any discrepancies found are minor and/or understandable in terms of scope or cause,
and further examination reveals the scope of the problem and that it is limited to a
particular aspect of the data.
73. India describes below how SAIL's US sales data were audited during the verification process
and how the information so verified meant that a unbiased and objective decision-maker could only
have concluded that it was "verifiable."
B. THE VERIFICATION OF SAIL'S US SALES COMPUTER DATABASE
DEMONSTRATED THAT IT WAS "VERIFIABLE"
74. The verification of SAIL's US sales data t ook place in several company locations over a two
week period between 30 August and 14 September 1999. It involved extensive examination by teams
of USDOC personnel performing both a macroscopic and microscopic analysis. They made a “top-
down” examination to insure that all US sales values and quantities were reported, and a “bottom-up”
examination to confirm that conclusion and to insure that the details of each transaction were reported
accurately. Indeed, the extent of the audit performed was emphasized by USDOC’s statement that
"we were able to test the accuracy of the reporting for a large number of individual sales
observations."
40 Furthermore, as the United States has acknowledged, "SAIL made relatively few
export sales to the United States. . . " 41 Thus, judging the accuracy and completeness ( i.e., the
verifiability) of SAIL US sales database was well within the grasp of USDOC's investigators.
75. A close examination of the USDOC’s verification report (Ex. IND-13) reveals the extensive
nature of the audit conducted on SAIL's US sales data. While India has discussed this document
previously, it bears further examination in light of the United States’ assertions that this information
was neither "verified" nor "verifiable." The key elements of the report show the following process
and results:
• The Completeness for US Sales section of the report (page 15) involved examining a number
of pre-selected US sales observations from individual contracts. This is perhaps the most important
step in USDOC’s sales verifications, the purpose of which is “to ensure that all sales of the subject
merchandise were properly included in [the respondent’s] sales responses.” 42 The overall conclusion
of this section is that all US sales were completely and correctly reported: “[w]e found no unreported
or incorrectly reported sales in the US sales listing”. This section even demonstrates that USDOC
“proved the negative” by examining export contracts to other countries and finding no shipments
destined for the United States under those contracts.
• The US Sales Process section of the verification report (pages 8-9) describes the
distinctive aspects of SAIL's export sales, including the existence of a separate
"International Trade Division" in New Delhi, which was responsible for negotiating
the price, quantity, and material terms of export contracts, and handled the major

40 Ex. IND-13 at 14.
41 US First Submission at para. 163. The omitted words in the quote stated "and yet even this data
contained errors." However, the verification report an d Final Determination both concluded that these errors
were susceptible to correction.
42 Ex. IND-12 at 10.

aspects of the sales process. The report concluded at page 8 that there were "no
discrepancies."
• The Customer Records section of the report (pages 10-11) shows that SAIL
maintained separate records for its US sales using the contract documents, while
documents identifying home market sales customers consisted of "invoice records."
The report concluded at page 11 that there were "no discrepancies" for the US sales.
• The Merchandise section of the report (pages 11-12) involved checking that all items
reported by SAIL as "not applicable" or "omitted" in the so-called “Model Match”
section of the questionnaire "were reported correctly and supported with
documentation". Four of the categori es (PRIMEU, PLEHEATU, PLSCALEU, and
PLPATRNU) were tested and "no discrepancies" were found. USDOC also found
that "all characteristics [of the merchandise] were reported correctly" except the
width coding error. Upon discovering th e width coding error at verification, SAIL
provided USDOC with information (inc luded in Ex. IND-8) identifying the
transactions affected by the error and permitting its correction.
• The Quantity and Value of Sales – US Sales section of the report (pages12-13) then
describes how US sales were identified in SAIL’s ledgers by using both sale-specific
documentation (contracts) and product-specific data in the sale records. This
technique showed that export sales were discernible from SAIL’s records and were
accurately isolated. USDOC noted that even in the atypical situation where a single
contract included shipments to more than one country, SAIL properly isolated and
reported only the US shipments covered by that contract. All nine contracts for US
shipments of subject merchandise during the period of investigation were examined
during the quantity and value verification. USDOC "reconciled the total US sales, as
reported to the Department, to sales ledgers, the general ledger, and the financial
statements for the POI." As USDOC stated at page 13, “[a] review of the other eight
export contracts showed no other situation where sales under a US export contract
was not sold to the United States.” These contracts were identified as reconciling to
SAIL’s records, and the complete reporting of all US sales was confirmed. The
conclusion for the entire Quantity and Value of Sales process was "no discrepancies."
• In the US Sales Contracts section of the report (page 14), USDOC’s bottom-up
examination of the details of the data in each examined transaction accomplished two
tasks. First, it confirmed the accurate reporting of price and quantity data for each
examined transaction, as well as the reported product characteristics (with the
exception of the correctable width coding error described in the Merchandise section
of the report at page 12). In addition, the transaction-specific data tied accurately to
SAIL’s US contracts, all of which were examined. USDOC states in its Completeness
section (at page 15) that “during our review of the detailed invoices covered by the
contracts listed above, we found no unreported sales and found that all sales of
subject merchandise covered by those contracts were within the POI and were
reported correctly.” The overall conclusion: "no discrepancies except for the coding
error described in the Merchandise section of this report."
76. Since all of the audited information described above was found to be accurate, complete and
reliable ( i.e., it was verified), what was the basis of USDOC’s conclusion that SAIL’s US sales
database was nevertheless unverifiable? As the Panel knows, the only "significant" (in USDOC's
terms) discrepancy found in the examination of US sales appears in the Merchandise section of the
report. There the verifiers note that the width coding error – i.e., a large number of transactions with a

width equal to 96 inches were misidentified as greater than 96 inches. A list of all of the affected
transactions was taken as a verification exhibit, 43 and the method for correcting the misidentification
was succinctly identified (re-code the width char acteristic from ‘D’ to ‘C’ for those transactions).
This section of the report also notes that certain “CONNUMs” for US merchandise were not reported
in the cost of production database. However, for US sales, the report states at page 12 that “we note
that all characteristics were reported correctly, unless otherwise noted.” Thus all of the characteristics
(grade, thickness, and width) necessary to match merchandise in the US sales database to merchandise
in the petition were either correctly reported or, in the case of the width error, correctable.
77. Another minor verification problem raised in paragraph 39 of the US First Written
Submission was that "SAIL had failed to report certain product control numbers in the cost of
production database" and "it was difficult for its verification team to evaluate whether the reporting of
product specification/grade was accurate because SAIL had prepared no supporting verification
exhibits."
44 Although the United States draws no conclusions from this statement, it leaves the
impression that this lack of information somehow supported the verification failure conclusion or
somehow made the data unusable. Neither of these conclusions is justified.
78. The field in the US sales database on which USDOC’s verification addendum of
10 November focused is “PLSPECU”, which is shorthand for “specification”. In this field, SAIL was
to report the specification, as defined by USDOC, of the product sold in each transaction. The
purpose of this information is to permit a tie betw een each of the products sold in each reported
transaction with the costs for the corresponding products reported in the CV database. However, a
product’s specification as defined by USDOC is merely the combination of its quality and “actual
specification”. Thus, the PLSPECU field is entirely duplicative of information that USDOC
requested and SAIL provided in full in other fields in the US sales database – namely, PLQUALU
and PLACTSPU. USDOC obviously recognized that this was not an important issue because it did
not treat the verifiers’ alleged difficulty in evaluating the reported PLSPECU data as a "significant
finding" in the Sales Verification Report. Th e PLSPECU field is not even mentioned in the
Determination of Verification Failure memorandum (Ex. IND-16).
79. Furthermore, regarding the “usability” of SAIL’s US sales database, as can be seen from the
description above, there is a fundamental reason why whatever misgivings USDOC may have had
about SAIL’s reported PLSPECU information do not render SAIL's US sales database unusable in
combination with NV data in the petition to calculate a dumping margin. This is because, when
USDOC rejected SAIL's home market and cost of production/CV databases, there was no longer any
need to match each specific product listed in SAIL ’s US sales database to a specific product in its
(rejected) CV database. Instead, the transactions in the US sales database would be matched to NV
data in the petition. And the petition developed its NV data on the basis of product characteristics
other than specification– namely, grade, thickness, and width. SAIL reported those characteristics in
its US sales database, and the information was fully verified by USDOC (as described above) and the
data for all these fields are set out in India’s Exhibit 8.
80. Finally, it is noteworthy in light of the new arguments by the United States in this proceeding
that the Sales Verification Report makes no mention, whatsoever, of any missing difmer cost data in
the US sales database. Nor is difmer mentioned in the Verification Failure Memorandum with respect
to SAIL's US sales data.
45

43 A large quantity of sample documents from the examined transactions were included as verification
exhibit S-7. The sample invoices that were included in that exhibit are attached hereto as Ex. IND-36.
44 US First Written Submission, para. 39 citing Ex. US-24, Addendum to Verification Report (10
November 1999).
45 Ex. IND-16.

81. In conclusion, the evidence before USDOC in December 1999 when it had to decide whether
SAIL's US sales information was "verifiable" was that summarized in paragraph 75 above. Recalling
that USDOC acknowledged in the Verification Report that "we were able to test the accuracy of the
reporting for a large number of individual sales observations," the issue before the Panel is whether an
objective and un-biased investigating authority could have concluded that the remaining sales that
were not specifically reviewed were "verifiable." India submits that this is the only conclusion that
could be drawn in the face of overwhelming evidence of the successful verification of the sales that
were specifically reviewed – i.e., that they were not only “verifiable” but also “verified”.
C. USDOC IMPROPERLY FOUND THAT SAIL'S US SALES DATA WAS NOT
VERIFIABLE BECAUSE OF THE UNVERIFIABILITY OF INFORMATION IN THE
HOME MARKET SALES AND COST OF PRODUCTION DATABASE
82. USDOC did not find that SAIL's US sa les data was "verifiable," however. In its
"Determination of Verification Failure" Memorandum, USDOC concluded that "given these
numerous and widespread problems found with the reported sales, cost and constructed value data we
must conclude that the credibility of the entire questionnaire response is lacking. Based on our
analysis, we recommend finding that SAIL failed verification."46
83. USDOC did not conduct the separate analysis of the verifiability of SAIL's US sales data as
required by Annex II, paragraph 3. Indeed, the only statement it made regarding SAIL's US sales data
suggested that SAIL's US sales data, standing alone, were verifiable:
As detailed in the Sales Verification Report, several errors were described in the US
sales database. While these errors, in isolation, are susceptible to correction , when
combined with other pervasive flaws in SAIL's data, these errors support our
conclusion that SAIL's data on the whole is unreliable. The fact that limited errors
were found must not be viewed as testimony as to the underlying reliability of the
SAIL's reporting, particularly when viewed in context the widespread problems
encountered with all the other data in the questionnaire response.47
84. This statement points to no major problems with SAIL's US sales. It cannot, because there
were none. It ignores the repeated and consistent "no discrepancies" findings for every aspect SAIL's
reported data in the Sales Verification Report. Ra ther, USDOC resorted to "guilt by association" by
implying that all of SAIL’s US sales information, despite being the subject of a rigorous and
successful verification, was somehow "unreliable" because of "widespread problems encountered with
all the other data in the questionnaire response."
85. USDOC's verification failure report points to no specific relationship between SAIL's US
sales data and its cost of production or home market sales data that would suggest the US sales data
was infected and thus not verifiable. This "finding" that the US sales data was infected has no basis
(articulated or otherwise) in the record. It is completely contradicted by the information USDOC
found in the Sales Verification Report (but did not mention in the verification "failure" report). It is
also contradicted by the lack of any meaningful relationship between SAIL's US sales data and the
rest of the information it produced. For example, in the Sales Verification Report, USDOC did not
use information from SAIL's home market source documents to verify SAIL's US sales documents --
rather, it logically used SAIL's US sales source documents. Moreover, as India states in its answers to
the Panel's question 28, SAIL's US sales data was generated, maintained, and used separately from its
home market sales information and cost of production information. All of this evidence demonstrates
the separate character of the US sales documents, and the lack of any meaningful connection between

46 Id. at 5.
47 Ex. IND-16 at 5 (emphasis added).

the US sales database and the other information supplied by SAIL. Therefore, there was no basis for
USDOC to conclude, in effect, that the informa tion in SAIL’s US sales database, despite being
verified, was not verifiable -- or in USDOC's terms that it "failed verification."
86. In conclusion, USDOC's "throw the baby out with the bathwater" approach to data
verification "failure" is inconsistent (1) with the text, object and purpose of the AD Agreement, and
(2) with the facts as set forth in the Sales Verifi cation Report. The impropriety of this procedural
error was compounded by the fact that in a "large number of observations" in SAIL's US sales data
were verified for what the United States has admitted was a small group of sales. Based on the record
before USDOC, no objective and unbiased investigating official could have concluded that SAIL’s
submitted US sales data were not “verifiable”.
VI. MEANING OF "DOES NOT COOPERATE" IN ANNEX II, PARAGRAPH 7
87. The United States has assumed in its arguments to the Panel that if a respondent has not
"acted to the best of its ability," then by definitio n, it "does not cooperate." The United States then
uses this assumption to justify the drawing of ad verse inferences. In other words, because SAIL
allegedly did not use its best efforts in responding to all portions of the questionnaire, it did not
"cooperate". The result is that it was subjected to the worst scenario possible-- the use of the $251
offer price for calculating export price. Thes e assumptions and the argument that USDOC was
entitled to apply adverse inferences in calculating a final dumping margin for SAIL are not correct.
88. In the Final Determination, USDOC explained this assumption as follows:
In selecting from among the facts otherwise available, section 776(b) of the Act
provides that adverse inferences may be used when a party has failed to cooperate by
not acting to the best of its ability to comply with a request for information. To
examine whether the respondent "cooperated" by "acting to the best of its ability
under section 776(b), the Department considers, inter alia, the accuracy and
completeness of submitted information and whether the respondent has hindered the
calculation of accurate dumping margins.
48
89. The applicable provisions are Annex II, paragraphs 5 and 7: They provide in relevant part:
5. Even though the information provided may not be ideal in all respects, this
should not justify the authorities from disregarding it, provided the interested party
has acted to the best of its ability.
7. . . . It is clear, however, that if an interested party does not cooperate and thus
relevant information is being withheld from the authorities, this situation could lead to
a result which is less favourable to the party than if the party did cooperate.
(emphasis supplied).
90. The trigger for the application of the "adverse" facts available (“less favourable” result)
provision of the last sentence of Annex II, paragra ph 7 is that information is being "withheld." The
word "withhold" means to "keep back what belongs to, is due to, or is desired by another; refrain from
giving, granting, or allowing; keep in custody or under control." 49 This definition suggests that a
foreign respondent is refusing to provide information within its possession, custody, or control. The
context for this definition is Article 6.8, which refers to "an interested party that refuses access to . . .

48 Ex. IND-17 at 73127.
49 New Shorter Oxford English Dictionary, Clarendon Press 1993, Vol. II, at 3705.

necessary information." This notion of "refusal" is consistent with the definition of “withhold,” which
requires that a foreign respondent must actively refuse to provide information that it knows exist.
91. By contrast, the concept contained in Annex II, paragraph 5 is quite different. Annex II,
paragraph 5 indicates that information should be used even if not ideal, if the respondent has "acted to
the best of its ability." A respondent may not act to the "best of its ability" because it has been
incompetent, has allocated insufficient company resources to the dumping questionnaire response
task, or even employed advisors that may not properly tabulate or present information within the
deadlines. But such behaviour does not mean that this respondent necessarily has "withheld"
information or that this would rise to the level of a finding that it did "not cooperate". There is a very
clear difference between not providing informati on and providing less than perfect information. Yet
the United States assumes that a failure to get everything right is the equivalent of withholding
information.
92. As India has argued, there are two different remedies available if a respondent has not acted
to the best of its ability. First, the information not supplied may be replaced with facts that are
available, including facts from the petition. The second remedy is that "adverse" facts may be used
for facts not supplied by a respondent that is significantly impeding the investigation or withholding
information. This is India's interpretation of the phrase "could lead to a result which is less favourable
to the party than if the party did cooperate." USDOC, in applying its procedures and Section 762(b),
however, treats all respondents who do not act to the best of their ability in the same way. It assumes
that they are all withholding information or ot herwise impeding the investigation, regardless of
whether or not the respondent repeatedly attempted to supply the requested information even if late,
or even if it actually did supply information but not to the satisfaction of the investigating authority.
93. USDOC's rationale that it applied in this case for assuming that the failure to apply best
efforts necessarily means a lack of cooperation is not consistent with the AD Agreement. Article 6.8
uses the term "refuses access to". This suggests non-cooperation and the "withholding" of
information. A respondent company that refuses to allow an investigating authority access to
particular information necessary to calculate accurate dumping margins is "not cooperating" with
respect to that information. But a respondent that may not be able to provide the information in a
timely fashion due to its confusion, incompetence or inexperience is not necessarily failing to
cooperate in providing the particular information.
94. The facts of this case illustrate the distinction between "acting to the best of one’s ability" and
"a failure to cooperate." There is no evidence in this case that SAIL actively withheld information
from USDOC. The United States has argued at length that SAIL failed to cooperate with the USDOC
in the submission of data regarding its home market sales and cost of production. However, the fact
that SAIL was not able to provide the requested home market sales and cost data in the formats
required by USDOC or within USDOC's timeframes does not indicate a failure to cooperate, but
rather shows the extreme difficulties that SAIL f aced in attempting to provide the data within the
extremely tight time constraints imposed by USDOC.
95. Moreover, SAIL worked intensively throughout the investigation process to provide USDOC
with the requested home market sales and cost of production information in the required formats, in
an attempt to avoid the application of “facts available” – even to the point of submitting a corrected
cost of production database on the first day of verification. The United States claims that SAIL’s
failure to meet the some of the deadlines for submitting responses to the supplemental questionnaires
demonstrates a failure by the company to cooperate. As discussed in India’s Oral Statement at the
First Meeting, the record demonstrates that SAIL’s difficulties were due to the overwhelming
logistical problems it faced in preparing information in a manner different from that in which it was
maintained in the ordinary course of business. However, even assuming for the sake of argument that
there were points during the investigation at which SAIL could have acted more promptly, the facts of

this case nevertheless illustrate the critical distinction between, at worst, incompetence on the part of a
respondent and an active withholding of informa tion that would rise to the level of a refusal to
cooperate.
96. USDOC implicitly recognized this distinc tion during and after the investigation. In all the
proceedings in which it has participated in the United States, including the Final Determination of its
investigation, in its arguments to the US Court of International Trade in defending its Final
Determination, and in its Redetermination on Remand, USDOC has never alleged that SAIL actively
withheld information or obstructed the investigation. In light of this record, it cannot now be argued
that SAIL’s actions somehow constituted a failure to cooperate that could give rise to “less
favourable” results (or “adverse” facts available in USDOC parlance) under Annex II, paragraph 7.
VII. USDOC IMPROPERLY DREW ADVERSE INFERENCES IN THE FINAL
DETERMINATION BY USING THE $251 OFFER AS THE EXPORT PRICE
97. The United States has argued that USDOC's Final Determination (which applied adverse
inferences in calculating SAIL’s dumping margins) was justified by SAIL's alleged lack of
cooperation in producing information other than US sales.
50 The final margin of dumping and the
final determination were based on an export price offer of $251 per ton, included in the petition.
USDOC applied the margin based on this export price because it drew an "adverse inference" in
selecting the margin, as noted in the Final Determination:
Moreover, because we determine that SAIL has not acted to the best of its ability,
pursuant to 776(b) of the Act, we used an adverse inference in selecting a margin as
facts available. The Department has applied a margin rate of 72.49 percent, the
highest margin alleged in the petition, as facts available.51
98. It is uncontested from this statement and from Figure 5 of the Petition (Ex. IND-1) that
USDOC selected the $251 price in the petition in orde r to secure the "highest margin alleged in the
petition." The legal question presented to the Panel by this finding and the evidence in the record is
whether an objective and unbiased investigating authority could have used this $251 price as an
"adverse inference."
99. As India has argued in Section VI above, the last sentence of Annex II, paragraph 7 does
permit the drawing of adverse inferences, but only in instances where respondents "do not cooperate."
India has argued previously that any finding of cooperation must be performed not on a "global"
basis, but based on the conduct of a respondent regarding particular categories (or in USDOC's terms
"essential components") of information.52 To hold that there is a "global" cooperation requirement is
tantamount to accepting the US argument that there are "global" use and "global" verifiability
requirements as well. As the United States has repeatedly argued, all information can be rejected if
there is a lack of cooperation regarding the production of some information. For all of the reasons set
forth in India's submissions, this "global" approa ch should be rejected. Accordingly, USDOC was
required to make a separate finding as to whether SAIL "cooperated" regarding the production of its
US sales data.
100. USDOC did not make such a finding. No objective and unbiased investigating authority
could have made such a finding or have drawn adverse inferences given the information set out in the
Sales Verification Report (Ex. IND-13). The Panel should so find. In addition, should the Panel
deem it necessary, even assuming arguendo that (1) the Panel were to find that SAIL did not

50 See US First Submission at paras 148-164.
51 Ex. IND-17 at 73131.
52 India First Submission at paras. 80-90.

cooperate in the production of information regarding home market sales and cost of production sales,
and (2) that USDOC was justified in applying total facts available, USDOC still would not have been
justified in drawing an adverse inference with re spect to SAIL's cooperation efforts in supplying
information regarding its US sales. At most, in such a scenario, USDOC could have used adverse
facts for calculating normal value (which, in effect, it already has done, by using the petition’s CV
figure as NV), but would have to use the US customs data (or even SAIL's US actual prices) as the
"available" facts for calculating the export sale price.
VIII. CONCLUSION
101. For the foregoing reasons -- as well as for the reasons in India's other submissions to the
Panel
53 -- India requests that the Panel make the following findings concerning the "matter" (the
measures and the claims) at issue before it:
• First Measure: The final action taken to levy anti-dumping duties on imports of cut-
to-length plate, including the final determination on 13 December 1999. India’s
major claims54 include the following:
• AD Agreement Article 2.4: USDOC failed to make a fair comparison
between normal value and export price when it used the $251/ton export
price.
• Article 6.8 and Annex II, paragraph 3: USDOC’s failure to use SAIL's
verified, timely produced & usable US sales data in the calculation of a
dumping margin violated Article 6.8 and Annex II, paragraph 3.
• Article 6.8 and Annex II, paragraph 5: USDOC’s failure to use SAIL's US
sales data in light of the fact that SAIL used its best efforts in supplying US
sales information violated Article 6.8 and Annex II, paragraph 5.
• Article 6.8 and Annex II, paragraph 7: USDOC’s improper drawing of
adverse inferences and use of the $251/ton export price in calculating the
dumping margin, without a basis in the record that SAIL failed to cooperate
in the production of the US sales data or, alternatively, in any other aspect of
the investigation, violated Article 6.8 and Annex II, paragraph 7.
• Article 15: USDOC’s failure to give special regard to SAIL's situation as a
developing country producer when considering the application of the facts
available violated Article 15, first sentence; and USDOC’s failure to explore
in good faith other constructive remedies before imposing anti-dumping
duties violated Article 15, second sentence.
• Second Set of Measures : Sections 782(e), 782(d) and 762(a) of the Tariff Act of
1930 as amended. Claims include the following:

53 See India's First Written Submission; India's First Oral Statement; and India's Answers to the
Questions from the Panel Following the First Meeting of the Panel with the Parties.
54 India continues to assert claims under AD Articles 2.2, 9.3, 6.6 and Annex II, paragraph 7
(concerning special circumspection), Article XVI:4 of th e Marrakesh Agreement, and Articles VI:1 and VI:2 of
GATT 1994 as reflected in its Request for the Establishment of a Panel (Ex. IND-23).

• Section 782(e) per se violates Article 6.8 and Annex II, paragraph 3 by
imposing two additional requirements (sections 782(e)(3) and 782(e)(4)) not
reflected in Annex II, paragraph 3, before a respondent may secure the use of
its information in calculating a dumping margin;
• Sections 762(a), 782(d) and 782(e) per se violate Article 6.8 and Annex II,
paragraph 3 because as interpreted by USDOC and the US CIT, they impose
a mandatory requirement on USDOC to impose total facts available if a
respondent does not provide information for one "essential" category of
information.
 • Section 782(e) as applied in this case violates Article 6.8 and Annex II,
paragraph 3 because USDOC imposed two additional requirements on the
use of SAIL's US sales data not reflected in Annex II, paragraph 3.
• Sections 762(a), 782(d) and 782(e) as applied in this case violate Article 6.8
and Annex II, paragraph 3 because USDOC, as affirmed by the US CIT, used
and applied these provisions in the application of total facts available.
• Third Measure : The application of USDOC's long-standing practice of applying
total facts available in this case. USDOC has a long-standing measure which it
applied in this case in a manner inconsistent with Article 6.8 and Annex II,
paragraph 3.

INTRODUCTION
1. In this submission, the United States addresses three issues: 1) the consistency of the US
“facts available” provisions with Article 6.8 and Annex II of the AD Agreement; 2) the decision by
US authorities to apply “facts available” in the challenged proceeding, consistent with Article 6.8 and
Annex II of the AD Agreement; and 3) India’s failure to establish a prima facie case that the
United States violated Article 15 of the AD Agreement by allegedly failing to explore the possibilities
of constructive remedies during the investigation. The United States will focus on new positions that
India has taken in its statements and submissions since the parties’ first written submissions.
2. As became evident at the first meeting of the Panel, this dispute involves a decision by the US
authorities not to use the Indian respondent’s data, most of which is acknowledged by India to be
inadequate, and the remainder of which contains de ficiencies which rendered it unusable. India has
made efforts to re-examine the facts before the US authorities to suggest there was a more reasonable
alternative available, but these efforts have served instead to reveal not only that the Indian
respondent failed to raise these arguments during the proceedings two years before, but that, even if it
had, they are flawed. The Panel should reject India’s efforts to examine de novo the factual record of
this case, as well as its arguments that the AD Agreement precludes the disregarding of the Indian
respondent’s data and that the US statute improperly mandates action inconsistent with Article 6.8 and
Annex II of the AD Agreement.
I. NOTHING IN THE "FACTS AVAILABLE" PROVISIONS OF US LAW MANDATES
ACTION INCONSISTENT WITH ARTICLE 6.8 AND ANNEX II OF THE AD
AGREEMENT
3. India continues to argue that the US statut ory provisions regarding the use of the “facts
available” are per se inconsistent with the AD Agreement. Narrowing its focus to section 782(e) of
the Tariff Act of 1930, India argues that this provision imposes additional conditions, which go
beyond those permitted under the AD Agreement.
1
4. The United States explained in its first wr itten submission the flaws in India’s argument. 2
Specifically, the United States explained that section 782(e) actually requires Commerce to consider
information that would otherwise be rejected under section 776(a). 3 Thus, section 782(e) serves to

1 Oral Statement of India at para. 62.
2 First Submission of the United States at paras. 131-39.
3 It is worth repeating the text of the provision:
(e) Use of Certain Information. - In reaching a determination under section
703, 705, 733, 735, 751, or 753 the administering authority . . . shall not
decline to consider information that is submitted by an interested party and
is necessary to the determination but does not meet all the applicable
requirements established by the administering authority or the Commission
if–
(1) the information is submitted by the deadline established for its
submission,
(2) the information can be verified,
(3) the information is not so incomplete that it cannot serve as a
reliable basis for reaching the applicable determination,
(4) the interested party has demonstrated that it acted to the best of
its ability in providing the information and meeting the requirements

reduce the likelihood that Commerce will resort to the facts available in a particular case. In fact, the
text of the companion provision authorizing Commerce to disregard all or part of a respondent’s
information – section 782(d) – is explicitly subject to the USDOC’s consideration of the information
pursuant to section 782(e).
5. In short, section 782(e) does not require Commerce to apply the facts available in a WTO
inconsistent manner; it requires Commerce to consider a respondent’s information when the five
listed criteria are met. Moreover, the section 782(e) criteria themselves are consistent with Article 6.8
and Annex II of the Agreement.
A. THE SECTION 782(E) CRITERIA ARE CONSISTENT WITH ARTICLE 6.8 AND
ANNEX II OF THE AD AGREEMENT
6. The plain language of section 782(e) specifically limits Commerce’s discretion to reject
information submitted by an interested party. Moreover, the five criteria in section 782(e) closely
track the text of the relevant provisions of the AD Agreement. For these reasons, there is no basis for
the Panel to conclude that section 782(e) of the Act mandates rejection of information that should be
acceptable pursuant to Article 6.8 and Annex II of the AD Agreement. 4
7. The factors identified in section 782(e) are all found in Annex II, paragraphs 3 and 5, of the
AD Agreement. India does not object to three of the criteria in section 782(e): that the information
be timely, verifiable, and usable without undue difficulty. These criteria are taken directly from
paragraph 3 of Annex II. Rather, India objects to the presence of the two remaining criteria found in
sections 782(e)(3) and (4).
8. Section 782(e)(3) provides that Commerce should take into account whether submitted
information is “not so incomplete that it cannot se rve as a reliable basis for reaching the applicable
determination.” When Commerce has a questionnaire response which contains some usable and some
unusable information, a relevant issue becomes whether Commerce has enough information to form
an objective basis for determining the respondent’s margin of dumping. Section 782(e)(3) simply
provides that, when the other criteria have been met, Commerce may not decline to consider the
partial information, provided that the information is not so incomplete that it cannot form a reliable
basis for a dumping calculation. In other words, if the respondent supplies enough information to
provide a reliable indication of its margin of dumping, the fact that Commerce may have to fill in
some gaps based on facts available will not prevent Commerce from using that information. In this
respect, section 782(e)(3) is analogous to paragraph 5 of Annex II of the AD Agreement.
9. India also objects to the criterion found in s ection 782(e)(4), which provides that Commerce
should take into account whether a party “has demonstrated that it acted to the best of its ability in
providing the information . . .” As the United States has noted previously, this provision is consistent
with Annex II, paragraph 5 of the AD Agreement:

established by the administering authority or the Commission with respect
to the information, and
(5) the information can be used without undue difficulties.
Section 782(e) (emphasis added) (Exh. IND-26).
4 As explained in our First Written Submission, the legislative history to section 782(e) of the Act
states that the provision “directs {Commerce} to consider deficient submissions” where the five criteria are met.
Statement of Administrative Action (SAA) at 865, US Exh. 23. Thus, the SAA confirms that section 782(e) of
the Act does not mandate rejection of WTO-consistent information, but rather provides restraints on
Commerce’s ability to disregard insufficient submissions under certain circumstances.

Even though the information may not be ideal in all respects, this should not justify
the authorities from disregarding it, provided the interested party has acted to the best
of its ability.
It is entirely proper, therefore, for investigating authorities to take into account whether a party has
acted to the best of its ability in submitting information.
10. India attempts to dismiss the explicit reference to this criterion in Annex II, simply because it
is in paragraph 5 rather than paragraph 3. To make the placement of the criterion significant, India
makes the totally unsupported assertion that the provisions of Annex II must be considered in
sequence. Under this “sequencing” approach, “Paragraph 5 only becomes applicable if a particular
category of information submitted does not meet the requirements specified in paragraph 3." 5
11. There is no logical basis – nor a textual one – to interpret paragraphs 3 and 5 in this manner.
Each paragraph is relevant to an investigating authority’s examination of submitted information. For
this reason, the “best efforts” criterion found in section 782(e)(4) is not inconsistent with the AD
Agreement.
12. In sum, each of the criteria contained in section 728(e) – including the two factors to which
India objects – is fully consistent with Article 6.8 and Annex II of the AD Agreement.
B. THE DISCRETIONARY NATURE OF SECTION 782(E) IS REFLECTED IN
COMMERCE AND CIT DECISIONS
13. India argues that decisions by Commerce demonstrate that, if submitted information fails to
meet the criteria of section 782(e), then Commerce will disregard all the information provided. Based
on India’s statements at the first Panel meeting, India apparently is not claiming that these decisions
themselves give rise to a WTO breach, but only illustrate how section 782 gives rise to such a
breach.
6 To the contrary, decisions by Commerce and domestic courts demonstrate that section
782(e) provides US authorities with discretion to accept data when the AD Agreement requires, and
that Commerce has exercised this discretion. Thus, this provision does not mandate any breach of the
AD Agreement provisions cited by India.
14. For example, in Stainless Steel Bar from India
7, Commerce determined that, although the
cost information provided by the Indian respondent was incomplete, pursuant to Section 782(e) of the
Act, it could use most of the information on the record in its calculations, and use “partial facts
available” in the few areas in which the few necessary facts were missing.
8 As a result, Commerce

5 First Written Submission of India at para. 83 (emphasis in original).
6 Moreover, even if India had made a separate claim with respect to “practice,” as explained in the US
First Written Submission, US “practice” does not have an “independent operational status” that can
independently give rise to a WTO violation. First Submission of the United States at para. 146.
7 Final Results; Administrative Review and New Shipper Review of the Antidumping Duty Order on
Stainless Steel Bar from India , 65 Fed. Reg. 48965 (10 August 2000) and accompanying Decision
Memorandum (India Steel Bar Final Results), Ex. US-26.
8 Commerce stated that “we have determined that the continued use of total adverse facts available
with respect to Panchmahal is unwarranted. Pursuant to section 782(e) of the Act, we will not decline to
consider information that is submitted, even if it does not meet all of our requirements, if the information was
timely, could have been verified, is not so incomplete that it cannot serve as a reliable basis for our
determination, the submitting party demonstrates that it acted to the best of its ability in providing the
information and meeting our requirements, and the information can be used without undue difficulties. With
respect to the information submitted by Panchmahal, we find that a sufficient amount of it meets these
requirements and, thus, we have not declined to use it in our final results .” India Steel Bar Final Results
Decision Memorandum, US-Exh. 26, at 3 (emphasis added).

resorted to facts available only with respect to certain portions of the margin analysis. India is thus
incorrect that section 782 requires US authorities to resort to “total facts available” if any information
fails to meet the requirements of that provision.
15. The US courts have also confirmed that section 782(e) “liberalized Commerce’s general
acceptance of data submitted by respondents in antidumping proceedings by directing Commerce not
to reject data submissions once Commerce concludes that the specified criteria are satisfied." 9
16. Finally, the United States notes again that India itself has acknowledged that “the text of
Sections 776(a) and 782(e) could be interpreted as applying to individual categories of
information." 10 SAIL’s own brief before the USCIT supports this argument. 11 In order to succeed
with its argument that the US statute is inconsistent with US WTO obligations, India must
demonstrate that the statute mandates WTO-inconsistent action, a position that both India and SAIL
have explicitly disavowed before this Panel and before US courts.
17. In sum, India has offered no basis for the Panel to find that section 782(e) mandates
WTO-inconsistent action, and the Panel should reject India’s claim to the contrary.
II. COMMERCE'S APPLICATION OF FACTS AVAILABLE TO SAIL WAS NOT
INCONSISTENT WITH THE STANDARDS OF THE AD AGREEMENT
18. Commerce’s application of facts available to SAIL was based upon an unbiased and objective
establishment of the facts and a permissible interpretation of the Agreement. The United States will
not burden the Panel with a repetition of the facts establishing SAIL’s failure to act to the best of its
ability to provide necessary information.
12 Instead, the United States will focus on the reason India’s
arguments on this issue lack any basis in the facts or under the AD Agreement.
A. INFORMATION THAT WAS NOT BEFORE THE INVESTIGATING AUTHORITY IS
IRRELEVANT
19. Pursuant to Article 17.6(i), in its assessment of the facts of the matter, a panel “shall
determine whether the authorities' establishment of the facts was proper and whether their evaluation
of those facts was unbiased and objective.” As articulated by the Appellate Body in United States -
Anti-dumping Measures on Certain Hot-Rolled Steel Products from Japan (“Hot-Rolled AB Report”),
pursuant to Article 17.6(i) and Article 11 of the DSU, both of which require an “objective”
assessment of the facts, “the task of panels is simply to review the investigating authorities’
‘establishment’ and ‘evaluation’ of the facts." 13 Because Commerce established the facts during its
anti-dumping duty investigation and evaluated those facts in its Final Determination, this means that
the Panel must assess Commerce’s evaluation of the facts at the time of the Final Determination .
While this assessment “clearly necessitates an active review or examination of the pertinent facts," 14
the facts that are “pertinent” are those that were in existence at the time Commerce made its final
determination – not the facts that India is just now bringing to the Panel’s attention.

9 NSK Ltd., v. United States, 170 F. Supp. 2d. 1280, 1318 (Ct. Int’l Trade, 6 June 2001), US-Exh. 27.
10 First Written Submission of India at para. 140.
11 SAIL’s CIT Brief, IND Exh. 19, at 16-18.
12 These facts may be found at paragraphs 19-58 and 148-164 of the First Written Submission of the
United States.
13 United States - Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan , Report of
the Appellate Body , WT/DS184/AB/R, adopted 23 August 2001, para. 55 (“ Hot-Rolled AB Report”) . See also
Article 21.5 Report, Mexico-Anti-Dumping Investigation of High Fructose Corn Syrup From the United States
(“HFCS AB Report”) , WT/DS132/AB/RW, adopted 22 October 2001, para 130. Article 11 of the DSU imposes
upon panels a comprehensive obligation to make an “objective assessment of the matter.”
14 Hot-Rolled AB Report, at para. 55.

20. Both parties have discussed the standard of review applicable under Article 17.6 of the AD
Agreement, and India acknowledges this standard. And yet, in its challenge to Commerce’s
application of “facts available” in this case, India asks the Panel to consider new facts and theories
conceived long after Commerce made its determination. The Government of India’s efforts to cobble
together facts and theories two years after Commerce’s decision cannot compensate for SAIL’s failure
to ensure that it provided the information necessary for Commerce to investigate the allegations of
dumping. Thus, to the extent that India has presented new factual evidence to this panel, including
new theories or models regarding how SAIL’s flawed and incomplete US sales database might have
been utilized in a margin calculation, this evidence is not properly part of the record before this Panel.
When considering whether Commerce’s decision was unbiased and objective, evidence and theories
which were not before Commerce during the investigation are irrelevant.
B. THE UNITED STATES' DECISION TO RELY ON THE FACTS AVAILABLE IN THIS
CASE IS CONSISTENT WITH ARTICLE 6.8 AND ANNEX II
21. Article 6.8 of the AD Agreement expressly permits the use of facts available when a party
fails or refuses to provide necessary information in an anti-dumping investigation. Annex II of the
AD Agreement sets out guidelines for investigating authorities when deciding whether to use facts
available. As discussed below, taken together, Article 6.8 and Annex II allow investigating
authorities to make preliminary and final determinations based entirely on facts available, which
could lead to a result which is less favorable to the party than if the party had cooperated and provided
the necessary information.
1. Article 6.8 of the AD Agreement
22. Article 6.8 of the AD Agreement provides:
In cases in which any interested party refuses access to, or otherwise does not
provide, necessary information within a reasonable period or significantly impedes
the investigation, preliminary and final determinations, affirmative or negative, may
be made on the basis of facts available. The provisions of Annex II shall be observed
in the application of this paragraph.
23. As explained in the US First Submission, a fundamental issue in this dispute is the proper
interpretation of the term “information" as used in Article 6.8 and Annex II of the AD Agreement.
15
The starting point for interpreting “information” as used with respect to “facts available” is Article 6.8
of the AD Agreement. Article 6.8 uses the term "necessary information;" as the United States
explained in its First Written Submission, the ordinary meaning of the term “necessary” is “[t]hat
which cannot be dispensed with or done without; requisite; essential; needful." 16 The “necessary” or
“requisite” or “essential” information for conducting an anti-dumping investigation includes the price
and cost information that is essential to the calculation of an anti-dumping margin.
24. According to India, “the US interpretation of ‘necessary information’ would require that when
a dumping margin is calculated, either all of the necessary information must be obtained from the
foreign respondent or all of the necessary information must be through the use of ‘facts available.’" 17
That is not correct. Applying the guidelines in Annex II, an investigating authority may determine

15 First Written Submission of the United States at paras. 82-92.
16 Id. at para. 83, citing New Shorter Oxford English Dictionary, Clarendon Press, Oxford, 1993.
17 Oral Statement of India at para. 41.

that it is appropriate to use all, some or none of the information provided by the exporter, depending
on the facts of the case. 18
25. The use of the word “necessary” to modify “information” in Article 6.8 is essentially a
limitation because not all information provided during an anti-dumping investigation is necessary to
the calculation of an anti-dumping margin. For example, if there is a question as to whether certain
sales are an appropriate basis for export price or normal value because of an alleged association
between the relevant parties to the transactions, the investigating authority may require the respondent
to report information on the so-called “downstream” sales. If the investigating authority subsequently
determines that the alleged association does not exist, the downstream sales are no longer necessary.
As a consequence, if the reporting of the downstrea m sales information was defective, that would not
constitute an absence of necessary information and would not be a basis to use facts available.
26. In its First Written Submission, India argued th at Commerce was obligated to focus on certain
“categories” of information – a term which does not appear anywhere in the AD Agreement.
19 Nor
is there any reference in the AD Agreement to “categories” of information or to “a portion of” the
necessary information. At the first meeting of the Panel, in fact, India conceded that the AD
Agreement does not refer to “ categories” of information and that investigating authorities are not
required to use bits and pieces of an exporter’s information. 20
27. Article 6.8 reflects a recognition on the part of Members that there is certain information,
most of which is in the control of the exporters, that is necessary to a dumping calculation and, if that
information is not available, the investigating authority must have the flexibility to make its
determination on the facts otherwise available. Annex II provides the guidelines for exercising that
discretion. However, Article 6.8 provides the context in which Annex II must be interpreted.
Specifically, the references to “information” in Annex II should be interpreted as a reference back to
the “necessary information” referred to in Article 6.8. This interpretation is supported by paragraph 1
of Annex II, which refers to “required” information.
28. This interpretation is also consistent with the purpose of the facts available provision. The
plain language of Article 6.8 of the AD Agreement provides that, when certain conditions have been
met, “preliminary and final determinations, affirmative or negative, may be made on the basis of facts
available.” (emphasis added). While there are instances in which "partial" facts available may allow
an investigating authority to calculate a margin af ter filling a "gap" of missing information -- such as
the weight conversion factors at issue in the Japan - Hot-Rolled Steel dispute and referenced by India
-- the situation with respect to SAIL was not such a case. Here, none of the necessary information
could be used to calculate a dumping margin in a manner that would satisfy the dictates of, inter alia,
Article 2.4 of the AD Agreement.
21 Having determined that the application of facts available was
necessary, Commerce was not required to calculate a dumping margin for SAIL because SAIL failed
to provide the necessary data. Instead, Article 6.8 authorized that Commerce's Final Determination
"may be made on the basis of facts available." 22

18 As discussed in section I, above, this is, in fact, authorized under US law, and is reflected in
decisions of US authorities applying this law. See also, the United States' response to Question 8 of the Panel's
25 January 2002, Questions to the United States.
19 See, e.g., First Written Submission of India at para. 50-51, 124-25.
20 Oral Statement of India at para. 34.
21 Article 2.4 of the AD Agreement explicitly requires that investigating authorities make a fair
comparison by making due allowance for all factors affecting price comparability.
22 Another example of India's mischaracterization of Commerce practice is its statement that “[i]f any
“necessary” information is not provided by a foreign res pondent, the United States interprets Article 6.8 and
Annex II, paragraphs 1, 3, 5, and 7 as giving it the discretion to disregard all of the information provided.” Oral
Statement of India at para. 40 (emphasis in original). The presumption – which is incorrect – is that Commerce
would reject all information provided if "any" necessary information is not provided. Not only does this

2. Annex II of the AD Agreement
29. As explained in the US First Written Submission, Annex II, paragraphs 1, 3, and 5 are
relevant to this dispute. 23 Not surprisingly, India disagrees with the interpretations offered by the
United States.
30. First, India argues that the United States ha s misinterpreted Annex II, paragraph 1 of the AD
Agreement, which provides:
As soon as possible after the initiation of the investigation, the investigating
authorities should specify in detail the information required from any interested party,
and the manner in which that information should be structured by the interested party
in its response. The authorities should al so ensure that the party is aware that if
information is not supplied within a reasonable time, the authorities will be free to
make determinations on the basis of the facts available, including those contained in
the application for the initiation of the investigation by the domestic industry.
31. As explained in the US First Written Submission, paragraph 1 of Annex II provides the basic
guidance in the AD Agreement for obtaining the participation of responding interested parties.
24 The
first sentence provides that the authorities, as soon as possible, should contact the parties, advise them
of the information required from them for the investigation, and advise them of the manner in which
to submit that information. The second sentence th en provides that the investigating authorities
should advise the responding interested parties of the consequences of not providing the required
information – that the investigating authorities will be free to make determinations on the basis of the
facts available, including, in particular, those facts contained in the application for the initiation of the
investigation.
32. India argues that the United States has misi nterpreted Annex II, paragraph 1. According to
India, for example,
The warning of the second sentence becomes relevant only for whatever information
is not supplied in the structure and manner requested. It does not apply to all of the
information requested unless a respondent refuses to provide any information.
25
Again, India proposes a reading not justified by the text: that investigating authorities are not free to
make a determination entirely on facts available unless the respondent refuses to supply any
information at all. It is a reading that would lead to illogical, if not absurd, results: a respondent could
fail to provide 99 per cent of the necessary information, and yet, because it had provided one per cent
of the information, the investigating authority would not be free to make its determination on the basis
of the facts available. This turns the explicitly authorized warning of Annex II, paragraph 1 into
meaningless verbiage.
33. There is a more logical reading, consistent with AD Agreement. The second sentence of
Annex II, paragraph 1 states that investigating authorities are free to make “determinations” on the
basis of the facts available. In context, “determinations” means the “preliminary and final

statement not reflect the situation involving SAIL – for which substantially more than “any” information was
deficient – but other Commerce decisions, including one subject to WTO dispute settlement, have expressly
disproved this point. See Hot-Rolled Panel Report at para. 7.65 (Commerce did not apply "total" facts
available; rather, Commerce applied partial facts available only for the US sales that were missing).
23 First Written Submission of the United States at paras. 98-114.
24 Id. at para. 100.
25 Oral Statement of India at para. 37.

determinations” in Article 6.8. Thus, if information – i.e., the “required” information referenced in
the first sentence of Annex II, paragraph 1, or the “necessary information” as defined in Article 6.8 –
is not provided, the investigating authority is free to make a preliminary or final determination based
on facts available, consistent with the other requirements of the Agreement, including Annex II.
34. The importance of Annex II, paragraph 1 is plain: parties must be made aware that, where
information is not supplied within a reasonable ti me, investigating authorities “will be free to make
determinations on the basis of the facts available. . . .” This interpretation is in harmony with
Article 6.8, which provides that “preliminary and final determinations . . . may be made on the basis
of the facts available” where necessary information is not provided.
(a) Paragraph 3
35. Annex II, paragraph 3 of the AD Agreement provides:
All information which is verifiable, which is appropriately submitted so that it can be
used in the investigation without undue difficulties, which is supplied in a timely
fashion, and, where applicable, supplied in a medium or computer language requested
by the authorities, should be taken into account when determinations are made.
36. As the United States explained in the First Written Submission, Annex II, paragraph 3
contains a number of conditions:
(i) the information is verifiable;
(ii) the information is appropriately submitted so that it can be used . . . without undue
difficulties;
(iii) the information is supplied in a timely fashion; and
(iv) the information, where applicable, is supplied in a medium or computer language
requested by the authorities.
Only if all four of these conditions are met do es the AD Agreement provid e that the information
should be taken into account.
(i) The information "is verifiable"
37. The term “verifiable” is defined as “able to be verified or proved to be true; authentic,
accurate, real."
26 The use of the word “verifiable” in Annex II, paragraph 3 of the AD Agreement is
understandable since an actual on-site verification is not required by the AD Agreement. Thus,
information that has not been subject to actual verification may be considered to be “verifiable, ”
provided that it is internally consistent and otherwise properly supported. In such circumstances, an
investigating authority that opts not to verify such information cannot decline to consider it because it
was not, in fact, verified. This was the principle expressed in the panel reports in Japan Hot-Rolled
and Guatemala Cement II 27, where the investigating authorities in those cases refused to accept or
verify the information during the relevant investigations.

26 New Shorter Oxford Dictionary, Clarendon Press, at 3564.
27 Guatemala – Definitive Anti-dumping Measures on Grey Portland Cement from Mexico ,
WT/DS/156/R, 24 October 2000, para. 2.274; United States – Anti-Dumping Measures on Certain Hot-Rolled
Steel Products from Japan , WT/DS/184/R (28 February 2001, adopted 23 August 2001) ( Hot-Rolled Panel
Report) at para. 5.79.

38. The facts established in this case are quite different, however. Neither the Japan Hot-Rolled
panel nor the Guatemala Cement II panel were faced with a situation like the instant one in which
on-site verification of the information was attempted but the information failed to be verified. Such
information which has actually been subjected to verification and found not to verify can no longer be
said to be “verifiable,” since it has been proven to be inaccurate. Such an explicit finding – such as
was made in this case – that a respondent’s information failed verification 28 rebuts any assertion that
information was “able to be verified or proved to be true." 29
39. One final point on the question of “verification: ” as the United States responds to India’s
arguments about the usability of SAIL ’s US sales database, India has tried to rehabilitate some small
portion of that database by placing inordinate weight on statements in the US sales verification report
that “no discrepancies were found.” As the United States has explained previously – and as India
acknowledged in its First Written Submission 30 – verification is the equivalent of an audit in which
information is “spot-checked” for reliability. At verification, Commerce determined that SAIL’s US
sales database contained discrepancies, a fact that India itself recognized.
31 In sum, SAIL’s
information did not satisfy the first condition of Annex II, paragraph 3, that it be verifiable.
(ii) The information "can be used without undue difficulty"
40. Similarly, it was reasonable to conclude that SAIL’s information – or even just its US sales
database – could not be used “without undue difficulty.” The term “undue” is defined as “going
beyond what is warranted or natural." 32 As discussed in detail during the first Panel meeting, among
the problems with SAIL’s US sales database was the fact that the cost information requested by
Commerce and supplied by SAIL as part of that database, failed verification and was unusable.
Commerce would have utilized this information to make a price adjustment, when the product sold in
the US was compared to a normal value with differe nt physical characteristics, consistent with the
requirements of Article 2.4.2 of the AD Agreement. In the absence of that information, it was not
possible for Commerce to compare non-identical merchandise.
41. In addition, the information as supplied by SAIL would not have permitted Commerce to
identify those US sales transactions that involved merchandise identical to a particular normal value
model without undertaking significant additional work. As discussed in the US First Written
Submission
33 and acknowledged by India 34, there were flaws with the sales transaction portion of
SAIL’s US sales database. The only way to correct those flaws would have been for Commerce to
have manually corrected approximately 75 per cent of SAIL’s US database.
35 Whether such efforts
would have resulted in any US sales of products being identical to the normal value model is
uncertain because Commerce was not obligated to, and elected not to, undertake this substantial effort
in light of the number of demonstrated problems with SAIL’s data.
42. India’s suggestion that Commerce did not make sufficient efforts to use SAIL’s information is
groundless and is, in fact, contradicted by the established facts. The United States agrees that the AD
Agreement contains a presumption that information from responding exporters is to be preferred over

28 Verification Failure Memorandum, Ex. US-25.
29 New Shorter Oxford Dictionary, Clarendon Press, at 3564.
30 First Written Submission of India at para. 57, n. 131.
31 First Written Submission of India at paras. 30-31.
32 New Shorter Oxford Dictionary, Clarendon Press, Vol. II at 3480.
33 First Written Submission of the United States at para. 39.
34 First Written Submission of the United States at para. 97-103.
35 See, e.g., First Written Submission of India at para. 26, where India explains that errors in the
“width” characteristic necessary for model matching affected 984 out of a total of 1284 sales observations.

alternative sources. 36 The established facts demonstrate that Commerce went to considerable efforts
to secure SAIL’s information and exercised an unus ual degree of leniency in addressing major flaws
in that information; nevertheless, SAIL ’s repeated and continuing failures prevented Commerce from
calculating a margin for SAIL within the time provided for in the AD Agreement.
(iii) The information "should be taken into account"
43. As noted above, the criteria of Annex II, paragraph 3 of the AD Agreement were not met with
respect to SAIL’s data. Consequently, it is not necessary for the Panel to interpret the phrase “should
be taken into account,” and whether that phrase sets forth any affirmative obligations relevant to the
present dispute. Instead, the relevant question for this dispute is whether, based on the facts before
Commerce at the time it made its Final Determination, an unbiased and objective decision-maker
could determine that it was appropriate to reject the exporter’s information and rely entirely on the
facts otherwise available. In the view of the United States, as discussed in our First Submission and at
the first Panel meeting, and as further discussed throughout this submission, the facts provide a more
than adequate basis for an unbiased and objective decision-maker to reach such a conclusion.
44. Nevertheless, if the Panel chooses to examine the phrase “should be taken into account,” the
United States offers the following additional commen ts. Annex II, paragraph 3 simply states that, if
the four conditions are met, then the information “should be taken into account.” Nevertheless, India
continues to argue that “‘paragraph 3 is a mandatory provision, and information meeting all four
conditions must be used by investigating authorities in connection with calculating the antidumping
margin."
37 But “must use” and “should be taken into account” are not synonymous terms.
45. The ordinary meaning of the term “should” differs greatly from the terms “must” or “shall.”
The former word implies a suggested course of action, while the latter terms impose a mandatory
obligation on Members. In United States - Anti-dumping Measures on Stainless Steel Plate in Coils
and Stainless Steel Sheet and Strip From Korea 38, the panel explicitly recognized that the ordinary
meaning of “should” does not impose mandatory obligations upon WTO Members in the context of
the AD Agreement. 39 Likewise, in EC-Measures Concerning Meat and Meat Products
(Hormones) 40, another panel recognized that the phrase “should take into account” in Article 5.4 of
the Agreement on the Application of Sanitary and Phytosanitary Measures, “does not impose an
obligation” because the word “should” was used and not the word “shall." 41 In two further reports,
panels in India-Patent Protection for Pharmaceutical and Agricultural Chemical Products 42 and
United States-Anti-dumping Act of 1916 43 also recognized that the phrase “should” indicates that
terms are “directory or recommendatory, not mandatory." 44 These findings alone provide
considerable evidence that the US interpretation of Annex II, paragraph 3, is, at the very least,
permissible, and therefore must be considered correct under the special standard of review contained
in Article 17.6(ii) of the AD Agreement.
46. Even if Annex II, paragraph 3 stated that info rmation “must” be taken into account, it would
take a further leap in logic to reach India’s reading that such information “ must be used by

36 First Written Submission of India at para. 70.
37 Oral Statement of India at para. 27 (emphasis in original).
38 WT/DS179/R, adopted 1 February 2001, para. 6.93 (“SSPC from Korea”).
39 Id. at para. 6.93 (“The term ‘should’ in its ordinary meaning generally is non-mandatory, i.e., its use
in [Article 2.4 of the AD Agreement] indicates that a Member is not required to make allowance for costs and
profits when constructing an export price”).
40 WT/DS48/R/CAN, adopted 18 August 1997 (“Hormones from EC” ).
41 Id. at para. 8.169.
42 WT/DS79/R, adopted 24 August 1998 (“Patent Protection from India ”).
43 WT/DS162/R, adopted 29 May 2000 (“United States 1916 Act”).
44 Patent Protection from India at para. 7.14; see also United States 1916 Act at para. 7.14.

investigating authorities in connection with calculating the antidumping margin." 45 The phrase “take
into account” is defined as “take into consideration” or “notice." 46 An obligation to consider or take
notice of something is distinct from an obligation to actually use that same thing.
C. COMMERCE'S DECISION TO APPLY FACTS AVAILABLE WITH RESPECT TO SAIL
WAS BASED ON AN UNBIASED AND OBJECTIVE EVALUATION OF THE FACTS
47. The portion of SAIL’s information that India is arguing could have been used by Commerce
to determine a dumping margin for SAIL seems to have shrunk over the course of the first Panel
meeting. During the underlying proceeding, SAIL insisted that all of its data would be corrected,
verified, and ready for use in an anti-dumping calculation. SAIL’s promises were never fulfilled. In
its papers subsequently filed with the US Cour t of International Trade, SAIL acknowledged that
“resort to facts available arguably is justified (but not required) . . .for both SAIL’s home market sales
data and its cost data." 47 Before this Panel, India started by taking up SAIL’s cause and arguing that
its entire US sales database should have been used. However, faced with the fact that SAIL could not
demonstrate the veracity of its reported cost info rmation – information that would be required to
make adjustments for physical differences between the US products and the normal value products
pursuant to Article 2.4.2 of the AD Agreement – India modified its argument to then suggest the use
of a small subset of US sales. Specifically, India’s most recent theory is that Commerce should have
used just the specific US sales that matched identically with the product upon which the normal value
alleged in the petition was based.
48. Even India’s fallback argument is belied by the facts of the case. As discussed previously,
SAIL’s US database contained recognized flaws, beyond the absence of usable cost information for
making price adjustments. In fact, it would not have been possible for Commerce to identify the US
transactions involving merchandise physically identical to the normal value merchandise using the
database as submitted by SAIL. That database contained inaccurate information regarding the
physical characteristics of the reported transactions. Thus, it would have been necessary for
Commerce to manually identify and correct approximately 75 per cent of SAIL’s database, before
making any further effort to utilize that data. Gi ven the repeated failure of SAIL to provide usable
data and Commerce’s verification that, at the very least, the vast majority of that data was completely
unusable, it was neither unreasonable nor inconsistent with the United States’ WTO obligations for
Commerce not to have undertaken this additional burden.
49. In its Oral Statement, India concedes that there may be circumstances in which the lack of
some aspect of the requested information renders the entire body of data to which that aspect pertains
unreliable. India stated,
if a foreign respondent provided information on all export sales but did not provide
information on a number of necessary characteristics of such sales (for example, their
physical characteristics or the prices at which they were sold), the investigating
authorities may be justified in finding that they cannot use that information without
undue difficulty because it is too incomplete.
48
We view this as a very significant concession by India because the foreign respondent in this case did
not provide information on a necessary characteristic (for example, the cost of manufacture data
required to measure the affect on price comparability caused by the differences in physical

45 Oral Statement of India at para. 27 (emphasis in original).
46 New Shorter Oxford Dictionary, Vol. 1 at 15.
47 SAIL’s USCIT Brief, Ex. IND-19, at 16.
48 Oral Statement of India at para. 58.

characteristics of the merchandise). Therefore, India’s own logic would support the rejection of the
US sales data.
50. Finally, having rejected SAIL’s attempt to resurrect its claim under Annex II, paragraph 7 –
that Commerce allegedly failed to exercise “special circumspection” in relying on information in the
petition as facts available – the Panel should reject India’s arguments that the margins used in the
petition were unreasonable. This was an unexpected issue for India to raise, since assessment or
“corroboration” of the information in the petition used as facts available is a factual exercise and
SAIL, the party that participated in the investigation, never objected to Commerce’s corroboration of
the petition during the investigation. 49
III. INDIA HAS FAILED TO ESTABLISH A PRIMA FACIE CASE THAT THE UNITED
STATES VIOLATED ARTICLE 15 OF THE AD AGREEMENT
51. The United States demonstrated in its first written submission that India has failed to establish
a prima facie claim of breach of Article 15 of the AD Agreement. None of the points that India raised
in the first meeting of the Panel changes this conclusion.
52. As the Panel noted in its written questions, India has focused its Article 15 claim on the
second sentence of that provision. 50 It did not even mention the first sentence in the first meeting of
the Panel. India’s approach to this matter reflects the fact that the first sentence of Article 15 imposes
no obligations on developed country Members. As India stated in the Bed Linens case, the first
sentence "does not impose any specific legal obligation, but simply expresses a preference that the
special situation of developing countries should be an element to be weighted when making that
evaluation." 51 Since the first sentence of Article 15 imposes no obligations on developed country
Members, there is no basis to conclude that a Member can breach that provision, and there is no need
to address this point further.
53. With respect to the second sentence of Article 15, the United States has acknowledged that
the provision creates an obligation to “explore constructive remedies.” That obligation only arises,
however, when the application of anti-dumping duties “would affect the essential interests of
developing country Members.” Until the United States noted this point in its first written submission,
neither SAIL nor India ever claimed that applying anti-dumping duties to SAIL would affect India’s
essential interests. Nor did India or SAIL ever identify what essential interests – if any – might be
implicated in this case.
54. India’s arguments on this point during the first meeting of the Panel amount to little more
than a bald assertion that the United States shou ld have known that applying anti-dumping duties to
SAIL would affect India’s essential interests. It is unable, however, to point to any evidence on the
factual record supporting its assertion. For example, since SAIL manufactures many different types
of steel products and sells those products throughout the world, its citation of the total number of
SAIL employees proves nothing.
52 Similarly, without knowing what percentage of the company’s
total sales were made up of steel plate exports to the United States, there is no way to evaluate the
importance of those sales to the company, much less to determine whether the application of an

49 See Commerce Corroboration Memorandum, Exh IND-30. This memorandum was issued more than
four months prior to the date on which SAIL filed its brief commenting on Commerce’s “facts available”
determination and yet the company never raised any objection to the corroboration exercise.
50 See United States – Anti-Dumping and Counterva iling Measures on Steel Plate from India ,
Questions for the Parties, 1 January 2002, Question 25.
51 Panel Report on European Communities – Anti-Dumping Duties on Imports of Cotton-Type Bed
Linens from India, WT/DS141/R, adopted 12 March 2001, para. 6.220.
52 Oral Statement of India at para. 70.

anti-dumping measure to those sales would affect India’s essential interests. If a company produces a
variety of products that it sells to a variety of markets, the imposition of an anti-dumping measure on
the export of a single product to a single export market may not even affect the company’s essential
interests, much less the developing country Member’s essential interests.
55. In addition, India’s arguments on this point evidence a lack of understanding of the US
position. Contrary to India’s assertion, the United States is not claiming that “a developing country
private respondent must have its government initiate government-to-government contacts before the
private respondent can seek a suspension agreement." 53 The fact that Commerce considered the
possibility of a suspension agreement without any intervention of the Indian government demonstrates
that the United States does not impose any such requirement. The United States is simply arguing
that there is no WTO obligation to “explore constructive remedies” unless the application of an
anti-dumping measure would affect the developing country Member’s essential interests. There is no
evidence on the record of the challenged investigation suggesting that this circumstance existed in the
present case.
56. India claims that the Article 15 obligation is triggered “even when the developing country
interested party or its government is silent."
54 It fails to explain, however, how a developed country
Member would ever be in a position to identify what interests individual developing country Members
view as “essential” in the absence of any claim from the private respondent or developing country
government, and investigating authorities cannot realistically be expected to assess whether the
application of an anti-dumping measure in a particular case would affect essential interests without
such a claim.
55 If anything, the fact that a developing country Member or its private companies
choose to remain silent should be viewed as prima facie evidence that the application of an
anti-dumping measure would not affect the developing country Member’s essential interests.
57. Nor has India found any support for its interpretation among the arguments of the third
parties. In their written submissions, Japan a nd the European Communities took no position on the
issue. In its oral statement, Chile asked the Panel to refrain from ruling on the claim, pointing out that
the Doha Ministerial recognized that clarification was needed on how to “operationalize”
Article 15.
56
58. In any event, the facts on the record demonstrate that Commerce did actively explore the
possibility of a suspension agreement in this case. The United States discussed this point at
paragraphs 188-191 of its First Written Submission. As was explained, Commerce officials held a
meeting with SAIL’s representatives specifically to discuss the possibility of a suspension agreement.
India’s claim that Commerce was unwilling to consider a suspension agreement is not supported by
the administrative record, nor did SAIL suggest during the investigation that the ex parte
memorandum reflecting this meeting was in any way inaccurate or incomplete.
59. For these reasons, there is no factual or legal basis to find that the United States has acted
inconsistently with Article 15.

53 Oral Statement of India at para. 71.
54 Oral Statement of India at para. 72.
55 The India Steel investigation is a case in point. As th e United States noted in its first written
submission (at para. 187), SAIL’s letter addressing the possibility of a suspension agreement did not mention
India’s essential interests, and it did not claim that (or explain how) applying an anti-dumping measure to
SAIL’s exports of steel plate would affect those interests. See Letter from SAIL’s Counsel to USDOC Re:
Request for a Suspension Agreement, dated 29 July 1999 (Exh. IND-10).
56 Oral Statement of Chile, 25 January 2002, para. 21.

CONCLUSION
60. For the foregoing reasons, the United States requests that the Panel reject India’s claims in
their entirety.

UNITED STATES – ANTI-DUMPING AND COUNTERVAILING
MEASURES ON STEEL PLATE FROM INDIA

Second Written Submission of the
United States of America
EXHIBIT
US-26. (A) Final Results; Administrative Review and New Shipper Review of the
Antidumping Duty Order on Stainles s Steel Bar from India, 65 Fed. Reg.
48965 (10 August 2000) and accompanyi ng Decision Memorandum; Final
Determination of Sales at Less Than Fair Value;
(B) Certain Polyester Staple Fibre From Taiwan, 65 Fed. Reg. 16877
(30 March 2000) and accompany Decision Memorandum