Document: WT/DS383/R Page A-1 ANNEX A WRITTEN SUBMISSIONS OF THE PARTIES Contents Page Annex A-1 Written Submi ssion of Thailand A-2 Annex A-2 Written Submission of the United States A-7
Document codes: WT/DS383/R
Complainant: Thailand
Respondent: U.S.
Third parties: Argentina, EU, Japan, South Korea, Taiwan
Dispute stage: Panel
Agreements cited: Art. 2.4.2  Anti-dumping

ANNEX A

WRITTEN SUBMISSIONS
OF THE PARTIES

Contents Page
Annex A-1 Written Submi ssion of Thailand A-2
Annex A-2 Written Submission of the United States A-7

I. INTRODUCTION

A. C OMPLAINT OF THAILAND

1. On 26 November 2008, the Government of the Kingdom of Thailand ("Thailand") requested
consultations in accordance with Article 4 of the Understanding on Rules and Procedures Governing
the Settlement of Disputes (the "DSU"), Article XXIII:1 of the General Agreement on Tariffs and
Trade 1994 (the "GATT 1994") and Articles 17.2, 17.3 and 17.4 of the Agreement on Implementation
of Article VI of GATT 1994 (the "Anti-Dumping Agreement") with respect to the application by the
United States of the practice known as "zeroing" of negative dumping margins in the United States'
determination of the margins of dumping in its anti-dumping investigation of polyethylene retail
carrier bags from Thailand (Inv. No. A-549-821).

2. Thailand and the United States held consulta tions in Geneva on 28 January 2009. While
these consultations assisted in clarifying the issues before the parties, they failed to resolve the
dispute.

3. At its meeting on 20 March 2009, the Disput e Settlement Body (the "DSB") established a
Panel in accordance with Article 6 of the DSU to examine the matter referred to the DSB by Thailand
in document

4. The Panel's terms of reference are the following:

To examine, in the light of the relevant provisions of the covered agreements cited
by Thailand in document , the matter referred to the DSB by Thailand
in that document, and to make such fi ndings as will assist the DSB in making the
recommendations or in giving the rulings provided for in those agreements.

5. On 20 August 2009, the parties ag reed to compose the Panel as follows:
1

 Chairman: Mr. Alberto Juan Dumont
 Members: Ms Deborah Milstein
 Mr. Norman M. Harris

6. Argentina, the European Co mmunities, Japan, Korea and Chinese Taipei reserved their rights
to participate in the Panel proceedings as third parties.

7. After its organizational meeting on 13 Oc tober 2009, the Panel established its working
procedures and timetable for this dispute. The working procedures and timetable are consistent with a
procedural agreement entered into by the parties and provided to the Panel regarding the appropriate
procedures for this dispute.
2

II. LEGAL ARGUMENT

A. T HE MEASURES AT ISSUE IN THIS DISPUTE

8. The specific measures at issue in this di spute are the anti-dumping order imposed by the
United States on polyethylene retail carrier bags from Thailand and the final determination by the
United States Department of Commerce ("USDOC") , as amended, leading to that order.

1 WT/DS383/3.
2 See Agreement on Procedures Between Thailand and the United States, 20 March 2009,
Exhibit THA-8.

The United States published its notice of initiation of its anti-dumping investigation of polyethylene
retail carrier bags from Thailand on 16 July 2003.
3 The final determination in this investigation was
published on 18 June 2004 4 (the "Final Determination") and an amended final determination was
published by the USDOC on 15 July 2004. 5 Following a final determination of injury by the
United States International Trade Commission, the United States issued an anti-dumping duty order
on imports of polyethylene retail carrier bags from Thailand on 9 August 2004 (the "Order"). 6 Thus,
the Final Determination, as amended, and the Order comprise the measures at issue in this dispute.

9. In the Final Determination, as amended, the USDOC used the "zeroing" methodology to
determine the final dumping margins for certain Th ai exporters of polyethylene retail carrier bags
subject to the Order. Accordingly, for certain Thai exporters, the Final Determination, as amended, as
well as the Order, reflected and included anti-dumpi ng margins that were calculated on the basis of
"zeroing". The use of the "zeroing" methodology is evident from the USDOC'S published
determinations cited above and the computer programmes used to calculate the margins of dumping in
the Final Determination, as amended, on which the Order was based.

10. More specifically, in calculating the anti-dumpi ng margins for certain exporters in the above
determinations, the USDOC:

 (i) identified different "models," i.e., types, of products based on the most relevant
product characteristics;

 (ii) calculated weighted average prices in the United States and weighted average normal
values in the comparison market on a model- specific basis, for the entire period of
investigation;

 (iii) compared the weighted average normal value of each model to the weighted average
United States price for that same model;

 (iv) calculated the dumping margin for an exporter by summing up the amount of
dumping for each model and then dividing it by the aggregated United States price for all
models; and

 (v) set to zero all negative margins on i ndividual models before summing the total
amount of dumping for all models.

11. Through this method, the USDOC calculates margins of dumping and collects anti-dumping
duties in amounts that exceed the actual extent of dumping, if any, by the investigated companies.

12. As Thailand will demonstrate below, this measure is inconsistent with the obligations of the
United States under the first sentence of Article 2.4.2 of the Anti-Dumping Agreement.

3 See Initiation of Antidumping Duty Investigations: Polyethylene Retail Carrier Bags from The
People's Republic of China, Malaysia, and Thailand, 68 Fed. Reg. 42002 (16 July 2003), Exhibit THA-1.
4 See Notice of Final Determination of Sales at Less Than Fair Value: Polyethylene Retail Carrier
Bags from Thailand, 69 Fed. Reg. 34122, 18 June 2004, Exhibit THA-3; Issues and Decision Memorandum for
the Final Determination of the Antidumping Duty Investigation of Polyethelene Retail Carrier Bags from
Thailand, 69 Fed. Reg. 34122, 18 June 2004, Exhibit THA-2.
5 See Notice of Amended Final Determination of Sales at Less Than Fair Value: Polyethylene Retail
Carrier Bags from Thailand, 69 Fed. Reg. 42419, 15 July 2004, Exhibit THA-5.
6 See Antidumping Duty Order: Polyethylene Retail Carrier Bags from Thailand , 69 Fed. Reg. 48204,
9 August 2004, Exhibit THA-6.

B. T HE USE OF ZEROING BY THE UNITED STATES WAS CONTRARY TO ARTICLE 2.4.2 OF THE
ANTI-DUMPING AGREEMENT

13. The use of zeroing in the challenged measures to calculate the margins of dumping for
exporters is inconsistent with the obligations of the United States under the first sentence of
Article 2.4.2 of the Anti-Dumping Agreement. In United States – Final Dumping Determination on
Softwood Lumber from Canada , the Appellate Body interpreted th e terms "margins of dumping" and
"all comparable export transactions" in Ar ticle 2.4.2 in an "integrated manner"
7, leading to its
conclusion that, where "an investigating authority has chosen to undertake multiple comparisons, the
investigating authority necessarily has to take into account the results of all those comparisons in
order to establish margins of dumping for the product as a whole under Article 2.4.2".8

14. This use of zeroing affected the determinati on of dumping margins for all of the investigated
exporters whose margins of dumping were not based on total facts available. These exporters are
listed in the Order as follows: Thai Plastic Bags Industries Co. Ltd., Winner's Pack Co. Ltd., APEC
Film Ltd, Advance Polybag Inc., Alpine Plast ics Inc., API Enterprises Inc., and Universal
Polybag Co. Ltd.
9

15. Thailand attaches as Exhibit THA-4 a copy of the programme used by the United States to
calculate dumping margins in the Final Determination, as amended, that was provided to some of the
investigated exporters. This programme indicates the use of "zeroing" in the calculation of the
dumping margins for the Thai exporters.
10 The same programme was used for all investigated Thai
exporters for whom the USDOC calculated marg ins of dumping in the measures at issue ( i.e., the
exporters whose margins were not based on total fact s available). This is the same methodology that
was found to be inconsistent with Article 2.4.2, first sentence, in US – Softwood Lumber V. 11
Thailand also notes that this is exactly the sa me methodology that was used by the USDOC to
calculate dumping margins in its anti-dumping inves tigations of shrimp from Ecuador and Thailand. 12
As noted above, the WTO panels in the disputes ar ising out of those investigations found that,
applying the rulings of the Appellate Body in US – Softwood Lumber V , this methodology was
inconsistent with Article 2.4.2, first sentence, of the Anti-Dumping Agreement.13

16. For the same reasons as articulated by the Appellate Body in the dispute US – Softwood
Lumber V and by the panels in the disputes US – Shrimp (Ecuador) and US – Shrimp (Thailand),
therefore, the use of this zeroing methodology by the USDOC in calculating the dumping margins of

7 Appellate Body Report, WT/DS264/AB/R, adopted 31 August 2004 ("Appellate Body Report, US –
Softwood Lumber V"), paras. 86-103.
8 Ibid., para. 122.
9 See Antidumping Duty Order: Polyethylene Retail Carrier Bags from Thailand , 69 Fed. Reg. 48204,
9 August 2004, Exhibit THA-6, p. 2.
10 See Memorandum dated 08 July 2004 re Amended Final Determination of Sales at Less Than Fair
Value in the Antidumping Duty Investigation of Polyethylene Retail Carrier Bags from Thailand – Analysis
Memorandum and accompanying log and output for margin calculation programs at lines 2567-2570 (setting
margins less than zero to zero ("IF EMARGIN LE 0 THEN EMARGIN = 0")), 2633-2637 ("WHERE
EMARGIN GT 0")), and 2693-2696 (limiting calculation of overall margin to speci fic comparisons where the
margin was greater than zero ("WHERE EMARGIN GT 0")), Exhibit THA-4.
11 See footnote 7, supra.
12 Panel Report, United States – Anti-Dumping Measure on Shrimp from Ecuador , WT/DS335/R,
adopted 20 February 2007, ("Panel Report , US – Shrimp (Ecuador)"); Panel Report, United States – Measures
Relating to Shrimp from Thailand , WT/DS343/R, adopted 1 August 2008 ("Panel Report, US – Shrimp
(Thailand)").
13 See footnote 7 supra, Panel Report , US – Shrimp (Ecuador), para. 7.41 and Panel Report, US –
 Shrimp (Thailand) paras. 7.28, 7.29 and 7.35.

certain exporters of plastic bags from Thailand was inconsistent with Article 2.4.2, first sentence, of
the Anti-Dumping Agreement.

17. Furthermore, as noted above, the parties have reached an agreement on procedures applicable
to the resolution of this dispute, attached as Exhi bit THA-8, providing that the United States will not
contest that the measures identified in the panel re quest are inconsistent with Article 2.4.2, first
sentence, of the Anti-Dumping Agreement on the grounds stated in US – Softwood Lumber V.

18. For these same reasons, therefore, Thailand s ubmits that the use of the zeroing methodology
by the United States in calculating the dumping margin s of certain of the exporters of plastic bags
from Thailand in this dispute is inconsistent with Article 2.4.2, first sentence, of the Anti-Dumping
Agreement.

III. RULINGS REQUESTED

19. Accordingly, Thailand requests that the Panel find that the United States acted inconsistently
with Article 2.4.2, first sentence, of the An ti-Dumping Agreement in determining the dumping
margins of certain Thai exporters in the Final Determination, as amended, and the Order.

ANNEX A-2

WRITTEN SUBMISSION OF
THE UNITED STATES

1. The United States notes that the parties to this dispute have reached an Agreement on
Procedures to permit expeditious resolution of this dispute.
1 In its request for a panel in this dispute,
Thailand claims that the United States has breached its obligations under Article 2.4.2, first sentence,
of the Agreement on Implementation of Article VI of the GATT 1994 . The basis of Thailand's claim is
the US Department of Commerce's use of "zeroing" when calculating the dumping margins for certain
investigated exporters in the investigation of Polyethylene Retail Carrier Bags from Thailand.2

2. Thailand describes, both in its request for a panel, and in its first written submission, the
Department of Commerce's use of "zeroing" in the calculation of the dumping margin for these
exporters as follows: the Department of Commerce (1 ) identified different "models", i.e., types, of
products are identified using "control numbers" that sp ecify the most relevant product characteristics;
(2) calculated weighted average prices in the US and weighted average normal values in the
comparison market on a model-specific basis, for the entire period of investigation; (3) compared the
weighted average normal value of each model to the we ighted average US price for that same model;
(4) calculated the dumping margin for an exporter by summing the amount of dumping for each
model and then dividing it by the aggregated US price for all models; and (5) set to zero all negative
margins on individual models before summing the total amount of dumping for all models.
3

3. Thailand further states that its claim is limit ed to the use of "zeroing" when calculating the
margins for "all of the investigated exporters whos e margins of dumping were not based on total facts
available". Thailand refers to the Order in this dispute which identifies these exporters as follows:
Thai Plastic Bags Industries Co. Ltd., Winner's Pack Co. Ltd., APEC Film Ltd, Advance Polybag Inc.,
Alpine Plastics Inc., API Enterprises Inc., and Universal Polybag Co. Ltd.4

4. Thailand states that the zeroing methodolog y applied in the Department of Commerce's
calculation of the dumping margins in the investigation of Polyethylene Retail Carrier Bags from
Thailand, is the same as the methodology found by th e Appellate Body to be inconsistent with
Article 2.4.2, first sentence, in US – Softwood Lumber Dumping .5 Thailand further states that it
considers the Department of Co mmerce's use of the "zeroing" methodology in calculating the
dumping margins of certain exporters of plastic bags from Thailand to be inconsistent with
Article 2.4.2, first sentence, on the grounds set forth in the US – Softwood Lumber Dumping
Appellate Body report.6

1 See Exhibit THA-8.
2 WT/DS383/2 (10 March 2009), pp. 2-3.
3 See WT/DS383/2, p. 2; First Written Submission of Thailand, 16 October 2009, para. 10 (hereinafter
"Thailand First Submission").
4 Thailand First Submission, para. 14.
5 Thailand First Submission, para. 15; Appellate Body Report, United States – Final Dumping
Determination on Softwood Lumber from Canada , WT/DS264/AB/R, adopted 31 August 2004 (hereinafter
"US – Softwood Lumber Dumping").
6 Thailand First Submission, para. 16.

5. The United States acknowledges the accuracy of Thailand's description of the Department of
Commerce's use of "zeroing" in calculating the dum ping margins for the individually investigated
exporters whose margins of dumping were not base d on total facts available. The United States
recognizes that in US – Softwood Lumber Dumping the Appellate Body found that the use of
"zeroing" with respect to the average-to-avera ge comparison methodology in investigations was
inconsistent with Article 2.4.2, by interpreting the terms "margins of dumping" and "all comparable
export transactions" as used in the first sentence of Article 2.4.2, in an integrated manner.
7 T h e
United States acknowledges that this reasoning is equa lly applicable with respect to Thailand's claim
regarding the individually investigated exporters whose margins of dumping were not based on total
facts available in the investigation at issue.