MEXICO – ANTI-DUMPING DUTIES ON STEEL PIPES AND TUBES FROM GUATEMALA
Document: Request for Consultations by Guatemala
Date: 23 June 2005
Document codes: WT/DS331/1; G/L/740; G/ADP/D62/1
Complainant: Guatemala
Respondent: Mexico
Third parties: China, EU, Honduras, Japan, U.S.
Dispute stage: Panel
Agreements cited: Art. 5.2, 5.3, 5.8, 2.1, 2.4, 2.6, 3.1, 3.2, 3.4, 3.5, 3.6, 4.1, 5.4, 6.4, 6.9, 9.1, 9.3, 18.1, 6.6, 6.8, 6.13, 6.7, 6.7, 2.2, 6.2, 12.2, 6.5  Anti-dumpingArt. VI  GATT 1994Art. 1, 18.1  Anti-dumping

MEXICO – ANTI-DUMPING DUTIES ON STEEL PIPES AND TUBES
FROM GUATEMALA

Request for Consultations by Guatemala

 The following communication, dated 17 June 2005, from the delegation of Guatemala to the
delegation of Mexico and to the Chairman of the Dispute Settlement Body, is circulated in accordance
with Article 4.4 of the DSU.

 My authorities have instructed me to request consultations with Mexico pursuant to Article 4
of the Understanding on Rules and Procedures G overning the Settlement of Disputes (DSU),
Article XXIII:1 of the General Agreement on Tariffs and Trade 1994 (GATT 1994) and Article 17 of
the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994
(the AD Agreement) with respect to the definitive anti-dumping duties imposed by Mexico on imports
of certain steel pipes and tubes originating in Guatemala and the investigation leading thereto.

 The investigation leading to the imposition of the measures at issue was initiated by the
Mexican investigating authority, the Ministry of the Economy ("Economía"), on 24 August 2001.
1
On 13 March 2002, Economía issued a preliminary resolution, in which it found that the imports
under investigation were being dum ped (at dumping margins of 3.41 per cent and 12.82 per cent for
the two categories of pipes and tubes under inv estigation from known exporters, and 25.83 per cent
and 26.59 per cent, respectively, from unknown e xporters) and that these dumped imports were
causing injury to the Mexican industry. Thus, Economía imposed provisional anti-dumping duties on
those products at the above mentioned rates.
2 On 13 January 2003, Economía issued its final
resolution, in which it found dumping margins of 29.93 per cent and 35.26 per cent for the two
categories of pipes and tubes under investigation a nd that these imports were causing injury to the
Mexican industry.
3 Accordingly, using the lesser duty rule, Economía imposed definitive anti-

1 Resolution Accepting the Application of the Intere sted Party and Declaring the Initiation of the Anti-
Dumping Investigation on Imports of Standard Pipes and Tubes (merchandise currently classified under tariff
classification 7306.30.01 and 7306.30.99 of the General Import Tax Law) exported from Guatemala,
irrespective of the country of provenance, 24 August 2001 ("Initiation Resolution").
2 Preliminary Resolution of the Anti-Dumping Investigation on Imports of Standard Pipes and Tubes
(merchandise currently classified under tariff classification 7306.30.01 and 7306.30.99 of the General Import
Tax Law) exported from Guatemala, irrespective of the country of provenance, 13 March 2002 ("Preliminary
Resolution").
3 Final Resolution of the Anti-Dumping Investigation on Imports of Standard Pipes and Tubes
(merchandise currently classified under tariff classification 7306.30.01 and 7306.30.99 of the General Import
and Export Tax Law) exported from Guatemala, irrespective of the country of provenance, 13 January 2003
("Final Resolution"), paragraphs 115, 273.

dumping duties on imports of certain steel pipes and tubes (the "subject products") from Guatemala at
the rate of 25.87 per cent.
4

 Article 1 of the AD Agreement requires that "[a]n anti-dumping measure shall be applied only
under the circumstances provided for in Article VI of GATT 1994 and pursuant to investigations
initiated* and conducted in accordance with the pr ovisions of [the AD] Agreement" [*footnote
omitted]. In the light of this requirement, and b ased on Article VI of GATT and other prov isions of
the AD Agreement hereafter cited, Guatemala is deeply concerned a bout the following aspects of the
measures imposed by Mexico and the investigation leading thereto:

 (a) Mexico failed to properly define the pr oduct under consideration and the like product.
This appears to be inconsistent with Articles 2.1, 2,4, 2.6, 3.1, 3.2, 3.4, 3.5, 3.6, 3.7,
4.1, 5.4, 6.4 and 6.9 of the AD Agreement.

 (b) Mexico initiated the investigation without properly determining whether the
application for the investigation contained a complete description of the allegedly
dumped product, sufficient evidence of dumping, injury and a causal link, and
without properly examining the accuracy an d adequacy of the evidence provided in
the application. This failure appears to be contrary to Article 5.2, 5.3, and 5.8 of the
AD Agreement.

 (c) Mexico failed to provide in its notice of initiation of the in vestigation adequate
information on the product involved, the basis on which dumping was alleged in the
application, and a summary of the factors on which the allegation of injury was
based. This failure appears to be contrary to Article 12.1 of the AD Agreement.

 (d) Mexico failed to properly define the relevant domestic industry and to use that
definition consistently for the purposes of its analysis of injury and causation. This
failure appears to be contrary to Articles 3.1, 3.2, 3.4, 3.5, 3.6, 3.7, 4.1, and 5.4 of the
AD Agreement.

 (e) Mexico relied on facts available to dete rmine the margin of dumping for the largest
Guatemalan exporter of the subject products without properly following the
procedures laid out in Article 6.8 and Anne x II to the AD Agreement. This failure
appears to be contrary to Article 6.8, Ar ticle 6.13, and Annex II, as well as to the
requirements of Article 2.1, 2.2, and 2.4 to conduct a fair comparison between the
export price and the normal value.

 (f) Mexico failed to disclose to the Guat emalan exporters that it had encountered
problems at the on-the-spot investigation that warranted the use of facts available.
This failure appears to be contrary to Ar ticle 6.2, 6.4, 6.7, 6.8 and 6.9 of the
AD Agreement.

 (g) Mexico made adjustments to the expor t price for certain categories of expenses
without making the symmetrical adjustme nts to the normal value for the same
categories of expenses that were necessary to achieve a fair comparison between the
normal value and the export price. This failu re appears to be contrary to Article 2.1,
2.2 and 2.4 of the AD Agreement.

4 Ibid., paragraph 275.

 (h) In its determination of injury and causal link, Mexico relied on dumping margins
determined inconsistently with Article 2.1, 2.2 and 2.4 of the AD Agreement. This,
in turn, appears to render Mexico's de termination of injury and causal link
inconsistent with Article 3.1, 3.2, 3.4, 3.5, 3.6 and 3.7 of the AD Agreement.

 (i) In its determination of injury and a cau sal link, Mexico failed to take into account
relevant data relating to the period pr eceding its investigation, resulting in a
determination of injury and a causal link that was not based on an objective
examination or positive evidence. This fa ilure appears to be inconsistent with
Article 3.1, 3.2, 3.4, 3.5, and 3.7 of the AD Agreement.

 (j) Mexico's analysis of both the volume of the allegedly dumped imports and the effect
of those imports on prices in the domes tic market for like products, and the
consequent impact of those imports on th e domestic producers of such products, was
not based on an objective examination or pos itive evidence. This failure appears to
be contrary to Article 3.1 and 3.2 of the AD Agreement.

 (k) Mexico failed to properly evaluate all relevant economic factors and indices having a
bearing on the state of the domestic industry. This failure appears to be inconsistent
with Article 3.1, 3.4 and 3.7 of the AD Agreement.

 (l) Mexico's analysis of the condition of the domestic industry for the purpose of its
injury and causation determinations failed to take into account data relating to all of
the companies within the defined domestic industry. This failure appears to be
inconsistent with Articles 3.1, 3.2, 3.4, 3.5, 3.6, 3.7 and 4.1 of the AD Agreement.

 (m) Mexico's analysis of the causal link be tween dumping and injury failed to properly
analyse other known factors, including, inter alia , changes in consumption, cost
increases, differences in production methods , technology, productivity, decline in
exports, and imports from other countries, that were at the same time causing injury
to the domestic industry, and failed to ensure that injury caused by those known
factors was not attributed to the imports unde r investigation. This failure appears to
be contrary to Article 3.1, 3.2, 3.4 and 3.5 of the AD Agreement.

 (n) Mexico failed, before issuing its final r esolution, to inform the Guatemalan exporters
of the essential facts under consideration that formed the basis for Mexico's decision
to apply definitive measures, including, inter alia, the reasons for Mexico's decision
to resort to facts available and the basis fo r Mexico's definition of the like product.
These failures appear to be contrary to Article 6.9 of the AD Agreement.

 (o) Mexico failed to disclose in its prelimin ary and final resolutions in sufficient detail
the findings and conclusions reached on all issues of fact and law that were
considered material by the Mexican authorities, including, inter alia, the reasons for
Mexico's definition of the like product and its resort to facts available to calculate
dumping margins for the largest Guatemalan exporter. These failures appear to be
contrary to Article 12.2 of the AD Agreement.

 (p) Mexico failed to complete its investigat ion within 12 months of the initiation without
making any finding of special circumstan ces that warranted extending the period of
time to complete the investigation. This failu re appears to be contrary to Article 5.10
of the AD Agreement.

 (q) Mexico failed to require the applicants to provide non-confidential summaries and to
properly disclose information that was not shown upon good cause to be confidential
or to disclose non-confidential summaries of confidential information. This failure
appears to be contrary to Article 6.5 of the AD Agreement.

 (r) Mexico has applied the measure to produc ts that were not covered by Mexico's
investigation and for which Mexico has not made determinations of dumping, injury,
and a causal link. This appears to be inconsistent with Articles 2.1, 2.6, 3.1, 3.2, 3.4,
3.5, 9.1, 9.3 and 18.1 of the AD Agreement.

 Guatemala reserves the right to raise additi onal questions regarding the measures at issue
during consultations.

 It appears to Guatemala that the fore going methodologies, calculations, comparisons,
determinations and procedures made or used by the Mexican author ities in their investigation and
imposition of the measures referred to above cannot be reconciled with Article VI of the GATT 1994,
Articles 1 and 18.1 of the AD Agreement, and th e specific provisions of the AD Agreement cited
above.

 Guatemala looks forward to receiving your reply to this request at your earliest convenience.
I propose that the date and venue of these consultations be agreed between our two Missions.