Document: WT/DS268/RW Page D-1 ANNEX D ORAL STATEMENTS, SUBSTANTIVE MEETING OF THE PANEL WITH PARTIES AND THIRD PARTIES Contents Page
Document codes: WT/DS268/RW
Complainant: Argentina
Respondent: U.S.
Third parties: China, EU, Japan, South Korea, Mexico, Taiwan
Dispute stage: Implementation & Compliance
Agreements cited: Art. 1, 2, 3, 6, 11, 12, 18, Annex II  Anti-dumpingArt. VI, X  GATT 1994Art. XVI:4  Agreement Establishing the World Trade Organization

ANNEX D

ORAL STATEMENTS, SUBSTANTIVE MEETING OF THE PANEL
WITH PARTIES AND THIRD PARTIES

Contents Page
Annex D-1 Opening Oral Statement of Argentina
 Closing Oral Statement of Argentina
D-2
D-20
Annex D-2 Opening Oral Statement of the United States
 Closing Oral Statement of the United States
D-23
D-27
Annex D-3 Third Party Oral Statement of China, People's Republic of D-29
Annex D-4 Third Party Oral Statement of the European Communities D-30
Annex D-5 Third Party Oral Statement of Japan D-36
Annex D-6 Third Party Oral Statement of Mexico D-41

ANNEX D-1

OPENING ORAL STATEMENT
OF ARGENTINA

Page

I. INTRODUCTION ............................................................................................................... 2
II. THE DEPARTMENT'S SECTION 129 DETERMINATION ........................................ 3
A. THE DEVELOPMENT OF NEW EVIDENCE........................................................................... 4
B. THE FINDINGS WITH RESPECT TO BOTH ARGENTINE EXPORTERS................................ 5
C. THE INFERENCE OF LIKELIHOOD BASED ON THE IMPORT VOLUME FINDINGS ......... 14
III. ARTICLE 6 VIOLATIONS.............................................................................................. 16
IV. THE WAIVER PROVISIONS ......................................................................................... 17
V. SUGGESTION FROM THE PANEL THAT THE UNITED STATES
TERMINATE THE MEASURE ...................................................................................... 18
VI. CONCLU SIONS ................................................................................................................ 19

I. INTRODUCTION

Mr. Chairman, members of the Panel:

1. The failure of the United States to comply w ith its obligations under Article 11.3 has led to
the absurdity of the United States initiating last month a second sunset review of the 1995
antidumping duty order on OCTG from Argentin a. This is absurd because the USDOC's first sunset
determination – from November 2000 – was found to be inconsistent with the Anti-Dumping
Agreement. Articles 11.3 and 11.4 required the Un ited States to make a WTO-consistent likelihood
of dumping finding in that review as a condition precedent to invoking the exception of Article 11.3
and continuing the anti-dumping measure beyond fi ve years. The United States unquestionably has
never fulfilled that condition precedent, and yet it mainta ins the measure, and even seeks to continue
it for five more years.

2. Argentina comes before this Panel for the sec ond time with the hope that the DSU system can
"preserve the rights and obligations of Members unde r the covered agreements," without the need for
"a potentially 'never ending cycle' of dispute settle ment proceedings and inor dinate delays in the
implementation…".
1

1Appellate Body Report, United States – Tax Treatment For "Foreign Sales Corporations" Second
Recourse To Article 21.5 Of The DSU By The European Communities , WT/DS108/AB/RW2, adopted
14 March 2006, para. 86.

3. As explained in Argentina's written submis sions, the United States not only has failed to
remedy those aspects of USDOC's 2000 decision found to be inconsistent with the Anti-Dumping
Agreement, it has issued a new decision that once again fails to comply with the requirements of
Articles 11.3 and 11.4. Accordingly, it also failed to bring itself into compliance by not revoking the
antidumping order, in the absence of a WTO-consiste nt determination, as required by Article 11.3.
Finally, in the process, the United States has also acted inconsistently with its obligations under
Article 6.

4. Argentina will not repeat all of its arguments today, but rather will focus its comments on the
issue of whether USDOC's Section 129 Determination brought the United States into compliance with
its obligations, both substantive and procedural. Argentina will address the "as such" violations at the
end of its presentation. Throughout its presentation t oday, Argentina will address several of the points
raised by the United States in its Second Submission.

II. THE DEPARTMENT'S SECTION 129 DETERMINATION

5. We believe, it is appropriate to begin a discu ssion of the purported US "compliance" in this
case by recalling the US violations that led to the need for a compliance proceeding. The Panel found
that the Department's 2000 sunset determination wa s inconsistent with Artic les 11.3 and 6.2 of the
Anti-Dumping Agreement. The Panel noted that the USDOC based its 2000 determination on its
conclusion that dumping had contin ued during the life of the order, a conclusion it reached by
1) relying on the existence of the original dumpi ng margin; and 2) inferring continued dumping from
the payment of minimal dumping duty deposits. The Panel found both facts to be insufficient to
establish that dumping had continued during the life of the order, and, therefore, insufficient to
establish that dumping was likely to continue or recur upon expiry of the order.
2

6. In purporting to bring itself into compli ance in 2005, the USDOC essentially followed the
same methodology: it made certain inferences regarding the continuatio n of dumping during the
sunset period, and on the basis of these inferenc es, it inferred that dumping would likely continue
upon expiry of the measure. As it did in 2000, the USDOC once again in 2005 relies on the post-
order volume decline to infer that dumping would be likely, and this is an additional basis for the
Section 129 Determination.

7. Regarding whether dumping continued during th e sunset period, the substance of the 2005
Section 129 Determination is quite different, and the USDOC has strayed even farther away from the
requirements of the Anti-Dumping Agreement than it did in the 2000 determination. Rather than
clarifying the evidentiary deficiencies found by the Panel with its conclusion that dumping had
continued in the past, the USDOC simply lowere d the standard and changed its finding from "past
dumping" to "likely past dumping" by the company Acindar. And, it did so by way of a comparison
that has no basis in the Anti-Dumping Agreement - a comparison done with so little diligence that its
conclusions are meaningless, and cannot serve as a basis for the finding required by Article 11.3.
3

8. Argentina has set forth in its written subm issions the reasons why the 2005 Section 129
Determination did not bring the United St ates into compliance with the Agreement.
4 Today,
Argentina would like to focus on th ree of those reasons: first , that the development of a new
evidentiary basis in 2005 does not comply with the obligation that the United States owed Argentina
as of August 2000; second , assuming arguendo that USDOC can rely on an evidentiary basis first
developed in 2005 to satisfy the Article 11.3 obligati on, the findings with respect to both Argentine

2 Panel Report, United States – Sunset Reviews of Anti-Dumping Measures on Oil Country Tubular
Goods from Argentina, WT/DS268/R, adopted 17 December 2004, para. 7.219 ("Panel Report").
3 See USDOC Section 129 Determination at 7-10.
4 See Argentina’s First Submission, paras. 38-143; Argentina’s Second Submission, paras. 8-144.

exporters are not based on an objective assessment of the evidence, and do not support a conclusion
that "dumping" is "likely" to continue or recur; and third
, that the Department's reliance on the volume
inference is inconsistent with the requirements of Article 11.3 of the Agreement.

A. THE DEVELOPMENT OF NEW EVIDENCE

9. The Department developed very little evidence in the 2000 proceeding. The evidentiary basis
of its continued dumping finding, and therefore likel y future dumping, was razor thin and legally
insufficient. However, this was the evidentiary basis that the Department developed, and it was on
this basis that the Department sought to jus tify the continuation of the 1995 measure beyond its
presumptive expiration date.

10. Under the explicit wording of Article 11.3, th e requisite "review" and "determination" are a
condition precedent to continuing the measure. In this cas e, the Department made choices about the
type of review it would conduct in 2000, and the manner in which it reached its 2000 determination.
If the United States cannot show now, based on th e evidence developed in USDOC's 2000 review,
that the United States was justified in invoking the limited exception in Article 11.3, then the
United States could not have invoked that exception, and was instead required to have terminated the
measure.

11. In the present context, the Panel need only find that the evidence relied upon now, in the 2005
determination, cannot justify the USDOC's 2000 decision to continue the measure beyond
August 2000, when it was never developed at that time as required by Articles 11.3 and 11.4. The
relevant question is, how could it, when the ev idence was never developed at the time? USDOC
could not possibly claim to have relied on this information when it considered the case in 2000.

12. The best illustration of this key point is the information in Exhibits ARG-18 and ARG-23,
which is part of the evidence that the Department us ed to find that the exporter, Acindar, was "likely
dumping" in the past. All of this evidence was developed, independently, by the USDOC in 2005,
just as the Department could have done in 2000. The Department merely asked the United States
Customs Service to provide the data, and it easily determined the origin of the exports that had
triggered the deemed waiver and statutorily- mandated likely dumping determination for the "non-
responding" respondents in the original review. Wh y was the information not developed in 2000?
Simply because the Department believed, erroneously , that it did not need to do so. It was not
conducting that type of "review," and it had, accord ing to the USDOC Sunset Policy Bulletin, plenty
of presumptions to make a determination. Argen tina would again recall the nature of Article 11.3
obligations, i.e., a mandatory rule requiring termination of the measure with a limited exception
which, by definition, must be interpreted narrowly.

13. If a Member can invoke the exception of Article 11.3 without conducting the type of review
required, and then simply conduct a different review later, including new and different evidence, the
requirement (or "rule") of termination loses its meani ng. The United States recognizes this. It is no
small statement that the United States makes in pa ragraph 23 of its Second Submission: "The only
'temporal limitation' in Article 11. 3 is that the review must be initiated before the five year
anniversary of the imposition of the order." Is time ly initiation of the review all it takes to comply
with Article 11.3? The Agreement makes clear that Members committed to more than this in
Article 1.3, and the Appellate Body agrees. The "r eview" conducted at that specific time is highly
substantive, and the Appellate Body has clarifie d that it is a rigorous process that entails both
adjudicatory and investigatory aspects. It is, in fact, so substantive that Article 11.4 contemplates
that the review can take a substa ntial amount of time in order to satisfy the rigorous requirements
imposed by Article 11.3.
5

5 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 113.

14. As Argentina has explained since the inception of this proceeding, the nature of the sunset
obligations in the Article 11.3 are unique. In this case, given the manner in which USDOC conducted
the 2000 sunset review, the USDOC could not, for the first time in 2005, comply with its obligations
by developing a new factual basis to support its 2000 determination to continue the measure.

15. In attempting to discredit Argentina's argument, the United States refers to Article 5.10 of the
Agreement and asserts that "[a]ccording to Argen tina's theory, a Member that has to bring an
investigation into compliance with WTO obligations would not be permitted to collect new
information."
6 But the example that the United States chooses supports Argentina's position that the
nature of the obligations and the actions of th e authority at the time affect whether and how
compliance can be achieved. If an administering authority failed to rende r a final determination
within 18 months, but imposed duties in any event, could the Member be allowed more time to bring
itself into compliance with the 18-month oblig ation? Or, suppose that during the 18-month
investigation, the authority never co llected (or even attempted to coll ect) data regarding export prices
or normal value, could that authority permissibl y do so several years later in a subsequent WTO
proceeding so as to justify the continued imposition of anti-dumping duties? This clearly would be
inconsistent with the Anti-Dumping Agreemen t, and the United States cannot credibly assert
otherwise. The facts of the dispute now before the Panel are very similar to these examples.

16. Finally, the suggestion by the United States of some "general understanding… shared by the
arbitrator"
7 in the DSU Article 21.3 proceeding that USDOC would collect new evidence and come
up with a wholly-new factual basis in 2005 to supp ort the 2000 determination must be rejected. The
assertion that USDOC's actions were somehow "approved" by the Arbitrator in the DSU Article 21.3
proceeding is wrong. In fact, the Arbitrator's Report expressly notes that "[t]he United States
emphasizes that this does not, however, mean that the USDOC would engage in a de novo sunset
review determination."
8

B. THE FINDINGS WITH RESPECT TO BOTH ARGENTINE EXPORTERS

17. In the alternative, even assuming arguendo that the USDOC were permitted to develop the
requisite factual information in 2005 to suppor t its 2000 likelihood determination, the 2005
Section 129 Determination nevertheless failed to satisfy the requirements of Article 11.3.

18. Regarding the USDOC's findings with respect to both Argentine exporters, those findings are
not based on an objective assessment of the evidence, and do not support a conclusion that "dumping"
is "likely" to continue or recur.

1. Acindar

19. USDOC states clearly the basis for its dete rmination with respect to Acindar: "The
combination of Acindar selling in the United States at below market prices at the end of the sunset
period and the depressed OCTG market, absent evidence that prevailing market conditions were likely
to improve in the near future, indicates that Ac indar likely was dumping significantly in the US
market."
9 In addition, Commerce asserted that the weakened condition of Acindar during the original
sunset review period was also indicative that Ac indar was likely dumping during this period.

6 US Second Submission, para. 23.
7 US Second Submission, para. 26.
8 Award of the Arbitrator, United States – Sunset Reviews of Anti-Dumping Measures on Oil Country
Tubular Goods from Argentina, WT/DS268/12, ARB-2005-1/18, 7 June 2005, para. 38.
9 USDOC Section 129 Determination at 7-8 (ARG-16).

Commerce then inferred that Acindar was likely to continue selling in the United States at dumped
prices if the order were revoked.

20. In evaluating the Department's findings, it is im portant to keep in mind the standard of review
to be applied by an Article 21.5 Panel, which, in turn, clarify what is exp ected from the investigating
authorities rendering a determination intended to bri ng the Member into compliance. The Appellate
Body recently clarified that, in the context of an Article 21.5 proceeding, the Panel's examination of
the authority's conclusions must be critical and searching,
10 and the Panel must ensure that the
authority's conclusions reached are reasoned and ad equate. The Panel's assessment must include an
analysis of whether an unbiased and objective author ity would have reached this conclusions with the
facts established in the record.11

21. Accordingly, the Panel must, with a cr itical and searching approach, assess whether the
following conclusions are reasoned and adequate in light of the evidence of the record and the
obligations of Article 11.3:

• Acindar was likely dumping during the period of the sunset review;
• Acindar was likely to continue selling at dumped prices if the order were revoked;
• Acindar's overall financial condition was pos itive evidence that Acindar was dumping
OCTG; and
• There was no evidence of improvements in the future market conditions.
Argentina believes that none of the USDOC's conclusions can withstand a proper review by the Panel.

22. There is no legitimate factual basis for the firs t two points – i.e. "likely" dumping in the past,
and, in turn, likely continued dumping in the future . In examining the 2000 sunset determination, the
Panel found that, if an investigating authority reli es upon the existence of dumping over the life of the
measure as part of its sunset determination, it has to have an adequate factual basis for so concluding.
Rather than explain the factual basis supporting its decision, the United States instead claims that the
"existence of dumping is not a prerequisite to c ontinuation of an order: Footnote 22 of the Anti-
Dumping Agreement expressly provides that even if dumping has ceased over the life of the order, the
order need not necessarily be terminated."
12

23. This could be correct in cases in which, unlik e the current one, the determination is not based
on "continuation" of selling at dumped prices. But it is inconceivable that a finding of a
"continuation" of "dumping" – even if it is only " likely" – can be made without positive evidence that
"dumping" ever occurred.

24. The United States clearly is trying to have it both ways: it wants to maintain the
notion of past dumping as the basis of its inference of likely future dumping, but it does not want to be
required to establish a sufficient factual basis that dumping actually occurred in the past. The problem
is apparent in the US First Submission, in whic h the United States recognizes that it was not possible
"for Commerce to evaluate whether dumping had in fact continued over the life of the order"
13 yet
nonetheless stated in the Section 129 Determination that "Acindar was likely to continue selling in the
United States at dumped prices if the order were revoked."14

10 Appellate Body Report, US – Lumber ITC Investigation (Article 21.5 – Canada), para. 93.
11 Appellate Body Report, US – Lumber ITC Investigation (Article 21.5 – Canada), para. 93.
12 US Second Submission, para. 35.
13 US First Submission, para. 40.
14 USDOC Section 129 Determination at 10.

25. In order for the Department to conclude, as it h as, that Acindar is likely "to continue" to sell at
dumped prices in the future, it must have made so me finding that Acindar in fact sold at dumped
prices during the sunset review period (1995-2000). Otherwise, the determination of "continuation"
of dumping under the Agreement would be rende red meaningless. The United States acknowledges
that the Department could not find that Acindar was dumping in the past, so it concludes that it likely
was doing so, and it reaches that conclusion through a strange comparison not provided for in
Article 2. The result is a decision that is based on impermissible speculation, and an insufficient basis
for determining what is likely to occur upon expiry.

26. Article 11.3 of the Agreement provides no basi s for the Department's approach. A Member
can maintain an anti-dumping measure beyond five y ears only if it determines that "dumping" would
be likely to continue or recur were the measure to be revoked. Article 11.3 does not contemplate a
review to determine the likelihood of continuatio n of dumping based on a finding of "likely past
dumping."

27. The United States stress es several times in its written submissions that it is not required to
perform an Article 2 calculation. But, as the Appellate Body has clarified, Article 2 is the only source
in the Agreement for making conclusions regarding "dumping."
15 Therefore, the "dumping" in
Article 11.3 is the "dumping" in Article 2, and Ar ticle 2 explains that "dumping" must arise from a
comparison of "export price" to "normal value." That is not what the United States did; rather, it
compared prices obtained from the US Customs authorities to local US selling prices.

28. Argentina would like to highlight today three points regarding the USDOC's actions:
First
, the developments in this case highlight the importance of requiring authorities to conduct a
WTO-consistent review at the time specified in Article 11.3. In this case, the Department sought cost
information that was 5 to 10 years old, and both companies explained that they did not retain product-
specific cost information this long, but that they could have provided it if USDOC had made the
request in 2000. 16 While the USDOC did not expressly state that it was drawing adverse inferences
from the fact that the co mpanies no longer had the product-specific cost information, it is clear that
the inability to produce the information was used ag ainst the companies. USDOC made no attempt to
seek other information; it simply issued a final determ ination, revealing at the time of the Section 129
Determination the new comparisons that demonstrated the purported "likely past dumping."

29. Second, US domestic prices are no substitute for nor mal value. Nowhere do Articles 11.3 or
Article 2 of the Anti-Dumping Agreement, or Article VI of the GATT 1994, mention prevailing
market prices in the importing country in the c ontext of "dumping". If USDOC wants to make a
determination of past "dumping", it must refer to the elements of "dumping", which do not include
prevailing market prices in the importing country.

30. The US domestic prices relied upon by USDOC have even less meaning when one considers
the findings of the USITC in the same sunset review. This Panel upheld USITC's affirmative
determination noting, among other things, that th e US price of OCTG during the review period was
significantly higher than the price of OCTG in other markets.
17 The fact that the observed prices of
Acindar were less than these elevated US prices does not support the view that Acindar was dumping:
a company presumably can sell below a significantly el evated price in the consuming market without
"dumping" within the meaning of Article 2. Th is is especially so now that the United States

15 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 127.
16 See Acindar’s Response to Questionnaire (30 November 2005) (ARG-14); Siderca’s Response to
Questionnaire (30 November 2005) (ARG-15).
17 See Panel Report, paras. 7.291, 7.297.

recognizes that Acindar's tube division was profitable.
18 The USITC's finding, already accepted by
the Panel, weakens further the tenuous reasoning relied upon by the USDOC.

31. Third
, the Department's comparison is, to put it mildly, a very "rough comparison." This
characterization cannot be denied, and the US S econd Written Submission does not really attempt to
deny it. Argentina asks that the Panel pay part icular attention to para graphs 39 and 40 of the
US Second Written Submission. After acknowledging th at many factors affect the price of different
OCTG products, the US claims that distinguishing seamless from welded OCTG, and carbon from
alloy OCTG, addresses the issues that "are the most cr itical for price comparisons." This is simply
wrong, and it further undermines the factual basis fo r USDOC's conclusion that Acindar "likely" was
dumping in the past, and the inference that Acindar was likely to dump upon expiry of the order.

32. To demonstrate the inaccuracy of the US position, I would like you to turn your attention to
the additional Exhibits which have been distribut ed, and which are labelled ARG-34 (1997 Price List
of US Steel) and ARG-35 (Diagrams and Photographs : Physical Characteristics of OCTG). These
Exhibits allow us to see clearly the fallacy of the US position.

33. First, ARG-34 shows the manner in which many of the physical characteristics of OCTG
affect a price comparison. The Exhibit is a 1997 price list from US Steel, a significant US OCTG
producer. Through the price list, US Steel informs its potential buyers of the price of different types
of OCTG (different steel grades, sizes, wall thicknesses, end finishes, and outside diameters), and then
instructs the buyer to "add" or "deduct" value from the standard price based on the physical
characteristics desired by the purchaser. For example, the last page of Exhibit ARG-34 contains the
prices for carbon and alloy tubing shipped from US Steel's production plant in Lorrain, Ohio. As
shown at the top of the chart, the prices appearing in the chart are in US dollars per short ton for
tubing produced to API Grades, with "external upset ends" ("EUE"), threaded and coupled ("T&C"),
in range 2 lengths. However, if a customer does not want this product, but instead wants a non-upset,
plain end pipe, the price list instructs the purchaser to deduct $250 per ton . This is marked with an
arrow on the Exhibit. This significant deduction alone – more than 25 per cent of the price of some
of the listed OCTG items – demonstrates that the USDOC's statements about its comparison are
wrong. The difference is more significant than whet her the pipe is "carbon" or "alloy," which the US
Steel price list for the Lorrain facility shows to account for less than 10 per cent for some size
ranges.
19 The price list also shows difference for other characteristics, such as outside diameter and
wall thickness.

34. These differences cannot be explained away as so me anomaly in US Steel's pricing. Rather,
they reflect the reality of the costing and pricin g of the many different OCTG products, a reality
which USDOC's comparison completely ignores. To demonstrate this further, we ask the Panel to
review ARG-35, which includes diagrams and pictures of some of the different physical
characteristics of the different OCTG products. Tu rning first to the diagram on page 1 of ARG-35,
one can see that, even within the class of OCTG products known as "tubing," the diameter range is
significant, ranging from 26.67 mm to 114.3 mm. Page 2 shows the wall thickness range for just one
of these sizes, the 4 ½ inch (114.3 mm) product that we observed in US Steel's price list: the
thickness ranges from 6.88 mm to 16 mm. Keep in mind that both of these diagrams only show a
cross section of the OCTG, and that these significan t differences continue for the length of the tubing,
which, using the US Steel price list quoting prices fo r "range 2," would be 7.62 to 10.36 meters, or 25
to 34 feet.

18 US Second Submission, 43.
19 For example, compare the price difference for 4 ½ inch carbon grade J55 No rmalized to the same
tubing of an alloy grade N80, yielding a difference of $100, which is 8.7 per cent of the carbon grade price of
$1150. This comparison is circled on the Exhibit.

35. Finally, pages 3 through 6 of ARG-35 show photographs and diagrams of the possible end
finishes. One can readily see from the diagrams wh y US Steel tells the customer to deduct $250 per
ton if the customer only wants a plain end product: some of these end finishes are highly-engineered,
precision connections that represent significant costs and commercial value. The diagram on page 3
shows the difference between a "plain end" finish (t he drawing on top) and different types of threaded
and coupled welded OCTG. Pages 4-6 of the E xhibit contain pictures that demonstrate these
differences on actual tubular products. Also, at this point I would like to call to the Panel's attention
to this sample of a threaded and coupled joint, which demonstrates vividly what appears in the
drawings and photographs of ARG-35. The sample shows the ends of two upset and threaded pieces
of the 60 mm (2 and 3/8 inches) tubing, and coupling that joins the two pieces. A "plain end" tube
would have none of this: no upsetting, no coupli ng, no threads on the coupling, and therefore none of
the costs associated with achieving such precision.

36. It is obvious that the costs and prices for OCTG products differ depending on the particular
combination of physical characteristics. It is equally obvious that the USDOC "comparison" ignored
the differences, and its explanation that the di fferences were sufficiently taken into account by
separating the products into "tubing" and "casi ng", and "carbon" and "alloy", is wrong and
misleading. Even with OCTG separated into tubing and casing and carbon and alloy, as the Preston
Pipe Report does, USDOC could not even know which OCTG specific products were included in the
average prices. Also depending on what is contained in the confidential versions of ARG-18 and
ARG-23, USDOC may not even have known what specific products Acindar exported to the
United States.

37. These shortcomings highlight additional reas ons why the United States has not brought itself
into compliance with its obligations. By using a co mparison that is so general and unspecified, it has
not created a sufficient evidentiary basis to draw any WTO-consiste nt conclusions about dumping,
either in the past or in the future. Also, it conduc ted its proceeding in a way that it did not even ask
the parties for information to improve the comp arison. USDOC disclosed the results of the
comparison in its final determination, without even attempting to ask the parties for information that
might have led to a more meaningful comparison.

38. As should be clear, the USDOC's comparison – which is much of the basis for its
determination of "likely past dumping," which in turn is the basis for its inference that dumping will
likely continue or recur in the future – is more th an rough. It is so general that it cannot be positive
evidence of anything, and certainly not "likely dumping" in the future.

39. Even if USDOC's comparison had established past dumping by Acindar – which it did not –
USDOC's jump from likely past dumping to likely dumping in the future would not comply with
Article 11.3. The USDOC merely presumed that "lik ely past dumping" is sufficient to show likely
dumping in the future. In fact, criticizing Argentina for mentioning other factors to be considered, the
United States says "The only relevant facts ar e that Acindar exported subject OCTG to the
United States during the period and was the only Argentine exporter, since the other exporter, Siderca,
diverted its shipments to other export markets after the imposition of the order. The size of Acindar's
exports or its production mix is irrelevant."
20 This reasoning is directly contrary to the Appellate
Body's authoritative rulings on the obligation of Article 11.3. It is clear that even in the case of
continued dumping during the period – which, as Arge ntina has established, rests on a highly flawed
analysis – the magnitude of the dumping margin and the volume of dumped imports must be taken
into account in the analysis. Indeed, the Appellate Body stated:

We would have difficulty accepting that dumping margins and import volumes are
always "highly probative" in a sunset review by USDOC if this means that either or

20 US Second Submission, para. 41.

both of these factors are presumed, by them selves, to constitute sufficient evidence
that the expiry of the duty would be likely to lead to continuation or recurrence of
dumping. Such a presumption might have some validity when dumping has
continued since the duty was imposed (as in the first scenario identified in Section
II.A.3 of the Sunset Policy Bulletin), particularly when such dumping has continued
with significant margins and import volumes.
21
40. The United States is simply wrong when it says that import volumes are irrelevant if it is
established that dumping continued, which, of course, the United States has not done here.
Furthermore, in this case, nobody knows what dump ing margin is associated with these imports, and
the volume of the imports was insignificant.

41. Moreover, an unbiased and objective authorit y could not have drawn any conclusion about
dumping in the past on the basis of observed import prices, a nd unadjusted, average prices of groups
of products in what was determined to be the hi ghest price market in th e world. Nor can USDOC
uphold its determination by saying that it was not finding actual dumping, but rather "likely"
dumping. It would indeed be absurd in this case if the Panel permitted the Department's use of the
word "likely" – which clearly was intended to accoun t for the prospective, counterfactual aspects of
the Article 11.3 determination of what would occur in the future – to serve as an excuse for not being
able to develop the factual basis about what occurred in the past.

42. It is important to distinguish an analysis of likelihood in the future, as a predictive analysis,
from an analysis of likelihood about past episodes. Prediction only involves the future, whether an
event or action will happen as a result of knowledge or experience. The idea is based on the fact of a
lack of certainty about the future, and this is the co re of Article 11.3. But there is no need to predict
past events, at least not under the Anti-Dumping Agre ement. Either dumping existed, or it did not, or
one does not know. While the United States can attempt to concoct a multitude of theories, the record
simply does not support any of its theories, and, most importantly, there is no evidence that dumping
had continued during the sunset revi ew period in this case. On these tw o key points – the "likely past
dumping" and the inference of likely continued dump ing in the future – the Department failed to
establish a sufficient factual basis, and did not reach a reasoned conclusion.¨

43. The USDOC did no better in its assessment of Ac indar's financial statements. In its Section
129 determination, the USDOC concluded that th e loss shown on Acindar's financial statements
indicates that OCTG was sold at dumped prices. The finding does not withstand scrutiny. USDOC
has taken Acindar's overall results notwithstandi ng the fact that Acindar's OCTG production never
accounted for more than one-half of one per cen t of its production. No valid conclusion regarding
OCTG can be drawn from Acindar's financial statem ents, and especially not one based on USDOC's
superficial analysis.

44. Independently, the US position regarding Acindar's financial st atements continues to evolve
through the US written submissions to this Pane l. When Argentina pointed out in its written
submissions before this Panel that USDOC overl ooked the fact that financial statement actually
showed that Acindar's pipe and tube division was profitable, the United States completely contradicts
the position it took in the Section 129 Determination . The United States now embraces the
profitability of Acindar's OCTG production, stating that "the fact that its tube and structural division,
of which OCTG is included, was profitable supports th e conclusion that Acindar will continue to rely
on this division to improve its overall situation, so the statement about using the export market to
stabilize its situation during periods of slowdown is supported by the profitable sales of the pipes
division."
22

21 Appellate Body Report, US – Corrosion Resistant Carbon Steel Sunset Review, para. 177.
22 US Second Submission, para. 43.

45. There are obvious problems with the statement. First, it was not the position taken in the
Section 129 Determination, where USDOC emphasized the Acindar losses. The latest explanation
that Acindar would use the profitable OCTG exports to stabilize the company is nothing more that a
post hoc rationalization.

46. The "stabilization" theory is illogical. How could exports of a product accounting for
0.5 per cent of a company's production stabilize the overa ll financial situation? It is impossible and it
cannot be accepted as the basis for a WTO-consistent decision.

47. Finally, there is no basis for USDOC to have disregarded evidence that the OCTG market was
beginning to improve at the end of the sunset peri od. As this Panel will remember, the USITC had
already made a similar finding, and had concluded in the same sunset review that the forecasts for the
industry were positive and that the US industry was not currently vulnerable.
23 In the Section 129
proceeding, Siderca provided its April – June 2000 fi nancial statement to the USDOC as evidence of
the turnaround in the sector. In its Second Writte n Submission, the United States tried to justify
ignoring the company's April – June 2000 quarterly statement on the basis that it is a quarterly,
unaudited statement. Of course, the narrative portions of financial statements are not "audited;" they
are the management's description to shareholders of the market trends affecting their investments.

48. Objectively, they are highly credible, proba tive evidence. The Unite d States also misses the
point that the full year financial statements ending 31 March 2000 also discusses the turnaround.
Argentina refers the Panel to Exhibit ARG-36 (Exc erpt from Siderca's Financial Statement For Fiscal
Year Ending 31 March 2000), which the USDOC had as part of the record of the Section 129
Determination. The section entitled "Outlook," on the last page of Exhibit 36, states that the recovery
had already started:

The recovery in crude prices and the good le vel of gas prices will influence a steady
recovery in the oil and steel markets. This outlook, seen in the context of the
introduction of new installations and signi ficant improvements in costs at operating
level, leads to an optimistic outlook for the coming year.
In fact, the company's April – June 2000 quarterly statement – which the United States argues is
unaudited and therefore not probative – refers to the 31 March 2000 statement, again confirming that
the recovery was underway:

As mentioned in the summary information report at 31 March 2000 , recovery in
crude prices and the good level of gas prices have pointed to a sustained recovery in
the oil and steel markets. This was reflect ed in the increase in sales, mainly exports,
which, together with significant cost improvements achieved at operating level,
enable optimism regarding the recovery of profit levels during the year.
24
49. The USDOC's efforts to undermine the cred ibility of this objectively probative evidence is
even less persuasive when compared to the quality of evidence that USDOC used to establish "likely
past dumping" and the likelihood of continuation or recurrence of dumping upon expiry.

50. In conclusion, USDOC has not provided a su fficient factual basis for its findings that:
a) "dumping" had likely occurred during the suns et period of review; b) dumping was likely to
continue upon expiry; c) Acindar's financial statements showed that Acindar would likely dump in the
future; and d) OCTG prevailing market conditions were not likely to improve in the near future.

23 See Panel Report, paras. 7.308-7.311.
24 See Siderca’s 30 November 2005 Response (ARG-15) at Attachment 1, page 9.

Furthermore, regarding points c) and d) the reco rd included positive evidence to the contrary, which
USDOC ignored.

2. Siderca

51. The United States reaffirms that the USDOC made no findings in the Section 129
Determination regarding Siderca.
25 The insistence by the United States on this point should be an
issue of concern for the Panel.

52. It is undisputed that Siderca is the prin cipal Argentine OCTG producer, the only company
ever investigated during the sunset period, and the only company for which a dumping margin (the
margin from the original investigation) was calcul ated. USDOC simply could not find any evidence
that Siderca was likely to dump if the order were re voked. In fact, Siderca provided information that
showed that: 1) the company achieved productio n efficiencies that made it a low-cost producer;
2) it had successfully diversified its markets throughout the sunset review period; 3) it had not been
accused of dumping in any other markets; and 4) it had chosen to avoid the US market for business
reasons unrelated to its presumed inability to ship without dumping. An objective examination of
these facts would require an assessment of the probativ e value of this evidence, and an explanation of
how the evidence relates to the likelihood of du mping in the event of expiry. Instead, the
United States seeks to justify its determination on the basis that USDOC made no findings with
respect to Siderca.

53. The United States also asserts that "Siderca di d not provide Commerce with actual costs for
the period."
26 This statement is incorrect. As Argentin a explained in its Second Submission, Siderca
provided actual cost data for the 1995-2000 period. Argentina refers the Panel to paragraph 64,
footnote 63, of Argentina's Second Submission.

54. As Argentina described in its written s ubmissions, USDOC's treatment of Siderca's
information demonstrates that USDOC did not conduct an unbiased assessment of the facts. Now that
Argentina and the Panel have received a copy of ARG-21, the Panel can see for itself the lack of
objectivity that was required for the USDOC to reac h the conclusion that Siderca's cost information
was "inconsistent" and "counter-intu itive." I would like to ask you to turn your attention once again
to the Exhibits distributed today, this time to ARG-37 (Confidential Version of ARG-21). This is an
excerpt (the first, second, and last page) from the confidential version of ARG-21, to which we have
added notations to facilitate our discussion today. The details of what this Exhibit shows already have
been explained in paragraphs 76-85 of Argentina's First Written Submission. But, now we can see it
clearly with the actual document.

55. As can be observed by the bracketed informati on on the first page in the portion of the Exhibit
marked with an arrow, USDOC was troubled by th e fact that "Siderca has reported higher costs for
carbon casing than for alloy casing," and that USDOC was "convinced" that this was wrong. In fact,
we can see from pages 2 and 3 of the ARG-37 that Siderca did not report the costs in the manner
DOC alleged. In fact, the data reported by Sider ca, in the 10 categories requested by the USDOC in
its questionnaire, showed that the alloy product w as almost always higher in cost than the carbon
product. Looking at the second page of the ARG- 37, which corresponds to the 1995/96 costs, and
looking specifically at the columns labelled "Adjusted TCOM" and "Total COP,"
27 item 3 exceeds
item 1, item 4 exceeds item 2, item 7 exceeds item 5, and item 8 exceeds item 6. Thus, Siderca's
reported costs were consistent w ith USDOC's expectation, and that remained so even after USDOC
adjusted the costs for certain tec hnical adjustments. This can also be seen on page 3 of ARG-37,

25 See US Second Submission, paras. 2, 44, 74, 82.
26 US Second Submission, para. 46.
27 TCOM means "total cost of manufacturing. TCOP means "total cost of production."

which summarizes the data for all years in the 10 categories reported by Siderca, and with the
technical adjustments made by DOC. There is only one exception relating to carbon and alloy casing
in the year 2000; in all other cases, Siderca reporte d costs for the alloy product that were higher than
the costs reported for the carbon product.

56. But, the mischief occurs through the averaging done by USDOC. Returning to page 2 of
ARG-37, we can see in the box drawn on the right side of the chart that USDOC averaged together
the costs associated with the plain end and the th readed and coupled product of each category, and
then compared the averages. In other words, they created a larger, more general category including
both plain end and products with special end finishes, compared the costs of the averaged categories,
and then made conclusions about the cost effect of producing an alloy or carbon product. Only
then does the data fit their theory.

57. I would ask the panellists to remember the demonstration in ARG-34 and ARG-35 a few
moments ago. We observed that OCTG can have many highly-engineered, precision end finishes, or
it can have no end finish and simply be sold "p lain end." We also observed that a major OCTG
producer such as US Steel directed its customers to "deduct" $250 per ton if it wanted a plain end
product, an amount that reflects not only the differe nce in commercial value of the two end finishes,
but, we can infer, some cost difference. In fact, Siderca's information shows the obvious: the
threaded and coupled end finish is always more expensive than the plain end product (compare the
average costs for 2 to 1, 4 to 3, 6 to 5, and 8 to 7 on the third page of ARG-37). There can be no
doubt that USDOC's decision to average th e costs of the different end finishes distorted and even
eliminated the very cost relationship Siderca consiste ntly reported and that USDOC purportedly was
seeking to confirm: that the cost of producing a carbon product is normally lower than the cost of
producing an alloy product.

58. The United States denies that USDOC has manipul ated the data or has in any way acted with
a lack of objectivity. But its explanation raises more questions than it answers. At paragraph 50 of the
US Second Written Submission, the United States e xplains that "Commerce grouped those items in
that manner because the available public information grouped the products in that manner." In other
words, USDOC took the more specific informatio n provided by Siderca and made it less precise
because the information that USDO C chose to use as its benchmark (the Preston Pipe information)
was less precise. What was important to USDOC was that the data be expressed in a certain manner,
even if that meant that any proba tive value of the resulting comparison was completely lost. In fact,
the comparisons cannot result in any meaningful c onclusions, and cannot be considered to be the
product of reasoned decision-making.

59. As pointed out in Argentina's First Written S ubmission at paragraphs 83 – 85, the analysis in
ARG-21 and the conclusion drawn from that analys is demonstrates: 1) a lack of objectivity;
2) a failure by USDOC to properly establish the facts necessary to reach reasoned conclusions
(including asking follow up questions to Siderca if it had any doubts about the information); and
3) the failure to consider information tending to sh ow that Siderca had competitive costs, and that it
was not likely to sell OCTG at dumped prices.

60. In conclusion, USDOC's analysis of the two Argentine exporters in the Section 129
Determination shows that the USDOC has not remedied the violations found by this Panel. In fact,
the USDOC followed the same methodology, this time inferring "likely past dumping", from which it
further inferred that dumping would be likely to conti nue or recur upon expiry. Rather than clarifying
the evidentiary bases for these inferences, the USDOC changed the standard regarding dumping in the
past, thereby increasing the level of speculation. This Panel should make the same finding that it
made before: the facts relied on by the United St ates "cannot represent a sufficient factual basis for
concluding that dumping continued during the life of the measure, le t alone representing an adequate
factual basis to conclude that dumping is likely to continue or recur."

C. THE INFERENCE OF LIKELIHOOD BASE D ON THE IMPORT VOLUME FINDINGS

61. Let us now turn to the third and final aspect of the Section 129 Determination that we will
discuss today: the inference that the USDOC draws from the decrease in volume. As an initial, but
important point, the Panel must reject any attempt by the United States to insulate portions of the
USDOC Section 129 Determination from the Panel's review of the US measures taken to comply with
the rulings and recommendations of the DSB in this case.

62. In its Second Submission, the United Stat es once again contends that "Argentina has not
demonstrated that the volume finding is a measure taken to comply." 28 The reason for this
US argument is obvious – the US reliance on the volum e decline without any analysis to justify such
reliance is directly contrary to US WTO obligati ons, and the interpretation of Article 11.3 by the
Appellate Body that a case-specific analysis of the reasons for a volume decline will always be
necessary.
29

63. While Argentina recognizes why the US seeks to place the volume finding beyond the reach
of this Panel, there is no basis for the US pos ition. First, the Section 129 Determination is
unquestionably a "measure taken to comply" for the purposes of DSU Article 21.5. Second, the
USDOC specifically relied on the inference of lik elihood of dumping arising from its findings on
import volumes from the original sunset review as a basis for the Section 129 Determination.
Therefore, the findings on volume are an integral part of the "measures taken to comply" for the
purposes of Article 21.5.

64. The USDOC Section 129 Determin ation is one of the measures taken to comply by the United
States in response to this Panel's finding that the USDOC's 2000 likelihood of dumping determination
was inconsistent with US WTO obligations. One of the principal bases for the US determination is
the USDOC's inference that dumping would be likel y to continue or recur based on the post-order
decline in OCTG imports to the United States. The USDOC Section 129 Determination states on the
first page:

[W]e solicited and considered inform ation and argument from domestic and
respondent interested parties for the same period at issue in our original sunset
review, 1995 – 2000. Based upon this information and argument, as well as findings
on import volumes during the 1995 – 2000 from the original sunset review, we
continue to find that revocation of the order would be likely to lead to continuation or
recurrence of dumping.
65. At page 11, the USDOC Section 129 Determination states:

In assessing likelihood, we also rely on our previous finding regarding the volume of
imports of subject merchandise for the peri od before and the period after the issuance
of the antidumping duty order. In the original sunset review, we found that after
imposition of the order, import volumes significantly decreased from pre-order levels.
[citations omitted]. Declining import volumes after, and apparently resulting from,
imposition of an antidumping duty order indi cate that exporters would need to dump
to sell at pre-order levels.
66. Each of these quotations from the Section 129 Determination demonstrate unequivocally that
USDOC's inference based on the volume decline is part of the Section 129 Determination. Thus, the
US argument that Argentina "fails to explain ho w Commerce 'relied' on the volume finding" for the

29 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 177.

purposes of the US measure taken to comply is co ntradicted by the very terms of the Section 129
Determination – the US "measure taken to comply."30 Any possible doubt on this issue is removed by
the USDOC's own declarations in the Section 129 Determination that it "relied on our previous
finding regarding the volume of imports."31

67. In addition, accepting the US argument – that the findings on volume are not part of the
"measures taken to comply" – is inconsistent with two important principles established by the
jurisprudence. First, it is not up to the implementi ng party to decide the scope of jurisdiction of an
Article 21.5 panel. After having stated expr essly in its implementing measure that it relied on its
prior findings on volume, the United States cannot now declare that this portion of the Section 129
Determination is somehow excluded from the scope of "measures taken to comply." To permit this
would allow the United States to determine unilatera lly which parts of the measures taken to comply
can be examined by an Article 21.5 panel, which, of course, it is not permitted to do.

68. Second, if the US position on this issue were to prevail, the Panel would be impaired in its
ability to determine the WTO-consistency of the US implementing measures, as based on Argentina's
panel request. The USDOC did not simply confirm its "original consideration" of the finding on
volume. Rather, it relied on this finding for the separate and independent purpose of its implementing
measure, i.e., the Section 129 Determination. Instead of indicating that a finding in the past
"remained unaffected", the USDOC relied on this finding as one of the two bases for its implementing
measure.

69. The US reliance on EC – Bed Linen (Art. 21. 5 – India) is misplaced. In United States –
Investigation of the International Trade Commissi on in Softwood Lumber from Canada, Recourse to
Article 21.5, the Appellate Body clarified that the scope of proceedings under Article 21.5 may be
limited by the scope of the original proceedings:

For example, a party cannot make the same claim of inconsistenc y against the same
measure (or component of a measure) in an Article 21.5 proceeding if the original
panel and Appellate Body found the measure to be consistent with the obligation at
issue… or if the original panel found that the complaining party had not made out its
claim with respect to the measure (or compone nt of a measure)…. Similarly, a party
may not , in proceedings under Article 21.5 of the DSU, seek to have the Appellate
Body "revisit the original panel report" when that report was not appealed.
32

70. None of the three scenarios identified by the Appellate Body apply here. There was no
finding that Argentina failed to make out a prima facie case, and the issue has never been adjudicated
in the first instance, unlike the first and third scen arios identified by the Appellate Body and unlike
the EC – Bed-linen case. In the present case, this Panel decided to exercise judicial economy and not
to make any finding regarding this point so it is simply wrong to state that the issue has been decided.

30 US Second Submission, para. 29.
31 USDOC Section 129 Determination at 6 (ARG-16) ("In making our likelihood determination, we
also relied on our previous finding regarding the volume of imports of subject merchandise for the period
before and the period after the issuance of the antidumping duty order ….") (emphasis added); see also USDOC
Section 129 Determination at 11 ("Based upon this information and argument, as well as findings on import
volumes during 1995-2000 from the original sunset review , we continue to find that revocation of the order
would be likely to lead to continuation or recurrence of dumping.") (emphasis added).
32 Appellate Body Report, US – Lumber ITC Investigation (Article 21.5 – Canada) , para. 102, n. 150
(citations omitted).

71. Argentina asks that the Panel find that the USDOC's reliance on the decreased volume in
making its Section 129 determination violates Articl e 11.3. As explained in Argentina's written
submissions, the Appellate Body has clarified in th e context of its analysis of the SPB that the
authorities must investigate the reasons for the volum e decline, and cannot simply presume that it is
an indication that the company cannot ship without dumping. The USDOC attempted no such
analysis in this case.

III. ARTICLE 6 VIOLATIONS

72. At the outset, Argentina wants to emphasize that our Article 6 claims are inseparably
connected with our substantive claim under Artic le 11.3. As the Appellate Body ruled in
US – Corrosion-Resistant Steel Sunset Review , Article 11.3 "envisages a process combining both
investigatory and adjudicatory aspects."
33 The "investigatory aspect" of the Article 11.3
determination requires full compliance with the procedur al obligations of Article 6. As the Appellate
Body has stated, authorities conducting a sunset review "must act with an appropriate degree of
diligence and arrive at a reasoned conclusion on the b asis of information gathered as part of a process
of reconsideration and examination."
34 The "process" of reconsideration and examination requires
compliance with Article 6. Any suggestion to the contrary would render a nullity the unambiguous
requirement of Article 11.4 that Article 6 applies to Article 11.3 reviews.

73. Thus, the Article 6 claims that have been ra ised by Argentina are not simply procedural in
nature. Rather, the failure of the United States to comply with its Article 6 obligations demonstrates
that the United States remains in breach of its substantive obligations under Article 11.3.

74. The US reference to a supposed "avalanche" of claims would seem to suggest that breaches of
the procedural violations of Article 6 are somehow trivial.
35 Incredibly, the Un ited States suggested
that this Panel should not "indulge" Argentina' s requests for a finding of such violations. 36 Yet the
Appellate Body has taken a very different approach to that advocated by th e United States. As the
Appellate Body stated in EC – Tube or Pipe Fittings:

[W]e wish to underscore the importance of the obligations contained in Article 6 of
the Anti-Dumping Agreement . This Article "establishes a framework of procedural
and due process obligations". Its provisions "set out evidentiary rules that apply
throughout the course of the anti-dumping investigation, and provide also for due
process rights that are enjoyed by 'interested parties' throughout such an
investigation".
37
75. The assertion by Argentina of such due pro cess rights is thus hardly something to be
"indulged." Rather, the violation of these rights wi ll irremediably taint the determination of the
investigating authority, as it did in the present case.

76. As demonstrated in the previous portion, the conduct of the Section 129 determination
suffered from substantive problems caused, in part, by the violations of Article 6. If the Department
had disclosed the essential facts to the parties, it would not have had to rely on the superficial

33 Appellate Body Report, US – Corrosion-Resista nt Steel Sunset Review , para. 111 (original
emphasis).
34 Id.
35 US Second Submission, para. 10.
36 US Second Submission, para. 10.
37 Appellate Body Report, European Communities – Anti-Dumping Duties on Malleable Cast Iron Tube
or Pipe Fittings from Brazil, WT/DS219/AB/R, adopted 18 August 2003, DSR 2003:VI, 2613, para. 138. Original
emphasis.

comparison that its at the heart of its "likely past dumping" finding. If the USDOC had asked Siderca
about the alleged "inconsistencies" in its cost da ta, rather than assessing the inconsistencies based on
"intuition,"38 it might have found the data to be probativ e. In both cases, the Argentine exporters did
not learn of the alleged deficiencies until the fi nal determination, where all doubts were resolved
against the exporters. These are not trivial violati ons, but rather demonstrate the USDOC's failure to
conduct the type of review required by Article 11.3.

IV. THE WAIVER PROVISIONS

77. We recall that the Appellate Body found that as a result of the operation of the waiver
provisions, certain order-wide likelihood determinations made by the USDOC will be based on
"statutorily-mandated assumptions about a company's likelihood of dumping."
39 In the view of the
Appellate Body, this result was inconsistent with the obligation of an investigating authority under
Article 11.3 to arrive at a reasoned conclusion on the basis of positive evidence.40

78. This WTO-inconsistent provision remains in force. Despite the authoritative ruling of the
DSB, this provision of the Tariff Act has been neither repealed nor amended.

79. The US defence of this failure to impl ement hinges on the flawed assumption that an
affirmative statement made by a respondent party th at it is likely to dump will always have strong
probative value – in fact, it will be determinativ e. In its Second Written Submission, the United
States dismisses the notion that other parties, for example, importers, could file statements that they
will not import dumped merchandise, reasoning that "the probative value of such a statement could
not possibly outweigh the exporter's own statement that it is likely to dump."
41 Thus, in the view of
the United States, nothing could be more probative of likely dumping than the admission by an
exporter that it is likely to dump.

80. The United States has evidently taken this pos ition because it has to do so in order to argue
that it has brought itself into compliance. The Tariff Act, which the United States chose not to
modify, requires a company-specific determination of likely dumping if a company waives its
participation. Once the waiver provision of the stat ute is triggered, the statute requires a finding that
the exporter is likely to dump. In the case of an a ffirmative waiver, the exporter's "confession" that is
now required by the revised regulation, must be corre ct in all cases; otherwise, the United States will
not have achieved compliance, because its statute would require an affirmative likelihood finding
even if there is competing evidence in a particular case.

81. The problem for the United States is that "c onfessions" are not always correct, and they are
not always the most probative evidence. When th ere is competing evidence, the authority has the
obligation to weigh the evidence and make a reas oned conclusion as to which evidence is most
probative. The unrevised statute permits no weighing of the evidence ; it mandates a finding that the
company is likely to dump in the event of revocation. As the Appellate Body has already observed, a
mandated finding with respect to one exporter n ecessarily affects the country-wide determination.
42
The waiver provision continues to prejudge the result, and the statutorily-mandated assumptions pre-
empt that reasoned weighing of evidence that the Appellate Body has made clear is part of the
"investigatory aspect" of the Article 11.3 process.

38See USDOC Section 129 Determination at 8 (ARG-16).
 39 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews , para. 234. Original
emphasis.
40 Id.
41 US Second Submission, footnote 9. Emphasis added..
42 Appellate Body Report, para. 234.

82. The United States claims that "Argentina has failed to explain how a respondent's statement
that it is likely to dump would not constitute 'positive' evidence."
43 The issue is not whether the
respondent's statement is "positive evidence." The issue is that, under the statute and under the
explanations provided by the United States, it is statutorily deemed to be the most probative
evidence, and no consideration of other evidence is permitted.

83. Finally, although the United States asserts that the waiver provision will be triggered only by
an affirmative waiver, the statute is clear that wh en a party "elects not to participate" in a USDOC
sunset review, the USDOC shall conclude that dumping is likely for that company. This is so whether
the company "elects not to participate" by filing an affirmative waiver or simply decides not to
participate. In such a case, the unambiguous requ irements of the statute cannot be overridden by
USDOC's modification of the regulation so that the statutory mandate becomes less broad. Under US
law, USDOC cannot contravene the clear intent of Congress as expressed in the statute (which intent
mandates a company-specific likelihood determination for any company that elects not to participate
in a USDOC sunset review), by attempting to limit the scope of the statute to include only a subclass
of parties that "elect not to participate" in sunset reviews (i.e., those that file affirmative statements of
waiver).

84. Accordingly, the United States remains in breach of its Article 11.3 obligations.

V. SUGGESTION FROM THE PANEL TH AT THE UNITED STATES TERMINATE
THE MEASURE

85. Mr. Chairman, Argentina renews its request that the Panel make a suggestion under DSU
Article 19.1 that the United States revoke its WTO-inconsistent order.

86. Earlier this year, in the context of an Ar ticle 21.5 proceeding, the Appellate Body strongly
cautioned against what it called the "never-ending cycle" of dispute settlement proceedings and
"inordinate delays in the implementation of recommendations and ruling of the DSB."
44 Such a
concern is only magnified when the issue rela tes to compliance with the time-bound provision of
Article 11.3.

87. In response to Argentina's request for a suggestion, the United States invoked paragraph 187
of the decision of the Appellate Body in US – OCTG from Mexico . It is important to note carefully
what the Appellate Body actually said in that paragraph.
45 It provides no assistance to the United
States at this stage in the dispute. First, and contrary to the position of the United States, the
Appellate Body referred to the "fact" that Article 11.3 sets a temporal limit for termination of an anti-
dumping duty, in the absence of a review leading to a WTO-consistent determination under that
Article for its continuation. Clearly, the Appe llate Body does not share the view that the only
temporal requirement of Article 11.3 is the timely initiation of the review.

43 US Second Submission, footnote 10.
44 Appellate Body Report, United States - Tax Treatment for "Foreign Sales Corporations": Second
Recourse to Article 21.5 of the DSU by the European Communities (WT/DS108/AB/RW2), adopted on
14 March 2006, para. 86.
45 The Appellate Body stated that:
The fact that the USDOC acted inconsistently with the requirements of Article 11.3 in its
likelihood-of-dumping determination does not necessarily imply that the underlying anti-
dumping duties must be terminated immediately. The mere fact that Article 11.3 sets a
temporal limit for termination of an anti-dumping duty, in the absence of a review leading to a
WTO-consistent determination under that Article for its continuation, does not affect the other
provisions of the DSU governing the implementation of the recommendations and rulings of
the DSB, including, inter alia, the means of implementation and the reasonable period of time
accorded to the implementing Member for implementation.

88. The Appellate Body also stated, as the United States has emphasized, that this did not affect
the other provisions of the DSU governing the impl ementation of the recommendations and rulings of
the DSB. These DSU rights include, most notably, th e right of the implementing Member to an RPT,
and the right of the Member to chose the means of implementation.

89. In the present case, however, the United States has already exercised its right to an RPT. The
RPT has expired. The United Stat es has also chosen the "means of implementation." Thus, the part
of paragraph 187 of the Appellate Body's Report that referred to DSU rights no longer applies, as the
DSU rights of the United States are now spent. What is left? The obligation under Article 11.3 that
the United States immediately revoke the illegal order, in the absence of a WTO-consistent
determination.

90. A suggestion would help to bring additional le gal clarity to this dispute, and to avoid the
spectre of the United States remaining in breach of its Article 11.3 obligations long after the time for
termination of the order.

91. DSU Article 3.7 provides that the "first obj ective" of the dispute settlement mechanism is
usually to secure the withdrawal of the WTO-incons istent measures. Given the long history of US
non-compliance in this dispute, Argentina asks simply that the Panel exercise its discretion to make a
suggestion in favour of the "first objective" of WTO dispute settlement.

VI. CONCLUSIONS

92. Mr. Chairman, members of the Panel: Stric tly speaking, this Article 21.5 compliance panel
has a narrow mandate. It needs to determine only whether the United States has complied with the
DSB rulings in the present case. But, accepting the US position would be to render inutile the
unambiguous rule of Article 11.3 that anti-dumping measures cannot continue indefinitely, but must
expire after five years. To allow the United Stat es to "implement" its WTO obligations by merely
timely initiating an Article 11.3 review and then continuously developing a factual basis to support a
decision would eviscerate one of the key reforms of the Uruguay Round. Argentina is confident that
the panel will reject such an interpretation, and re nder a clear ruling that the United States remains in
breach of its obligations.

93. Argentina would refer the Panel to paragraphs 225 and 226 of its First Submission, in which it
set forth in particularity its request for findings and a suggestion from the Panel for revocation.

94. I thank you for your time and attention, and I would be pleased to answer any questions you
may have.

Appellate Body Report, Appellate Body Report, United States – Anti-Dumping Measures on Oil Country
Tubular Goods (OCTG) from Mexico, WT/DS282/R, adopted 28 November 2005, para. 187.

CLOSING ORAL STATEMENT
OF ARGENTINA

13 July 2006

I. INTRODUCTION ............................................................................................................. 20
II. THE SECTION 129 DETERMINATION ....................................................................... 20
III. THE INFERENCE OF LIKELIHOOD BASED ON THE
IMPORT VOLUME FINDINGS ..................................................................................... 21
IV. DEVELOPMENT OF NEW FACTUAL BASIS IN 2005 TO
SUPPORT 2000 DETERMINATION.............................................................................. 21
V. SUGGESTION FROM PANEL THAT THE UNITED STATES
REVOKE THE ORDER ................................................................................................... 22

I. INTRODUCTION

Mr. Chairman, members of the Panel:

1. Argentina will only make a few points in closing today:

II. THE SECTION 129 DETERMINATION

2. With respect to the Section 129 Determin ation, the United States observed in its opening
statement that Argentina failed to rebut or challenge the fact that Acindar's prices were lower than the
prevailing prices in the US market as reported by the Preston Pipe publication. Argentina would note
the following.

3. First, Argentina did not know these prices – indeed still does not know the prices – because
Argentina is unaware of the content of the confiden tial versions of ARG-18 and ARG-23. Neither we
nor the Panel even knows the extent to which USDO C identified the specific products being used for
the comparison. It may be the case that the USDOC co mpared "plain end" to a mixture of products in
the Preston Pipe categories, that also are not identified. Precisely this situation leads us to support the
EC's comments on the confidential information issue this morning.

4. Second, even assuming arguendo that Argentina knew the specific prices, the fact that the
prices are lower says nothing about whether Acindar was "dumping" (as defined by the Agreement)
during the sunset period. Argentina certainly pr ovided ample evidence and argument to fully rebut
any notion that the observation of lower prices was probative of whether it was "likely" that Acindar
"dumped" during the sunset review period. Argent ina explained that there were problems with using
the prevailing US market prices and that the USDOC comparison was one not recognized by Article 2
and did not create a reasonable basis for USDOC to infer that Acindar was likely dumping during the
period, let alone that it would be likely to dump in the future, consistent with the requirements of
Article 11.3.

5. Third, it is not surprising that Acindar's pr ices were lower than the prevailing US market
prices, as the ITC made a finding, reviewed by this Panel, that US OCTG market prices were
significantly higher than other world market prices. Given this fact, Acindar certainly could have sold
below US prices, but not at dumped prices.

6. Argentina was also surprised to learn yest erday of USDOC's knowledge of the fact that
Acindar's market was not a viable market during any year of the sunset review for purposes of
establishing normal value for use in a dumping calcul ation. USDOC never asked that question in the
original review or in the Section 129 proceeding. The US disclosure yesterday that it knows this
because of a post-sunset review of Acindar cont radicts its own statement that it cannot conduct a
de novo review, which it interpreted to mean that it had to use information that existed during the
sunset review period. Also, what precisely di d the USDOC know about Acindar's home market or
export markets in 1998, 1999, and 2000. Presumably, information gathered in a subsequent year, and
not each year of the sunset review period.

7. In the field of procedural matters, in res ponse to a question yesterday, the United States
professes to have paid "meticulous" attention to Ar gentina's Article 6 claims, but that it has had
difficultly in understanding the basis for Argentina's claims of procedural or due process violations.
As meticulous as the United States may have been in its consideration of Argentina's procedural
rights, Argentina wonders if the failure of the Unite d States to provide to Argentina the essential facts
of the Section 129 Determination before issuing it, and only doing so more than a week later at the
request of that party's legal counsel, strikes Argentina as a due process problem that ought not to be
overlooked. Argentina would refer the Panel to ARG-26, which answers the simple and straight-
forward question of whether the Parties had seen the essential facts serving as the basis for the Section
129 Determination before that decision was issued.

III. THE INFERENCE OF LIKELIHOOD BASED ON THE IMPORT VOLUME
FINDINGS

8. During the course of this proceeding, Arge ntina provided extensive argumentation on two
points: First, that the volume findings were integr al to supporting the Section 129 Determination and,
therefore, clearly part of the US measure taken to comply. Second, Argentina demonstrated that
USDOC failed to conduct any substantive analysis to determine the reason for the volume decline
and, hence, the mere presumption based on volume could not serve as a basis for determining that
dumping would be likely.

9. It is telling that the United States chose not to rebut any of Argentina's arguments from its
Second Submission. The reason is obvious – there is no analysis of the volume. Argentina invites the
Panel to look at pages 1 and 11 of the Section 129 Determination (ARG-16), and then to look at
ARG-8, the Issues and Decision Memorandum fro m USDOC's 2000 sunset review, to see precisely
what was incorporated. Given the lack of any analysis on the question of volume, it is easy to
understand why the United States seeks to avoid the Pa nel's scrutiny on this part of its measure taken
to comply.

IV. DEVELOPMENT OF NEW FACTUA L BASIS IN 2005 TO SUPPORT 2000
DETERMINATION

10. The United States continues to offer the conc lusory statement that Argentina provides no
textual support for its argument that USDOC coul d not develop new evidence in 2005 to support its
2000 determination. Argentina provided textual s upport. Argentina invites the Panel to review
Argentina's written submissions in which it explains the obligations and temporal limitations of
Articles 11.3 and 11.4, based on the text – notably the meaning of "review" and "determination" and
the fact that the additional duration of the c onduct of the sunset review, as provided for in

Article 11.4, is the only additional exception to maintaining the order beyond the five year
presumptive date.

11. Articles 11.3 and 11.4 establish the window of opportunity for the administering authority to
collect information to establish the evidentiary basis in order to make the substantive determination.
Argentina asks again, how can these requirement s can be reconciled with the collection of new
information by the USDOC five years later in a compliance proceeding in order to support the
determination that was made five years earlier?

12. Argentina's position is consis tent with paragraph 187 of th e Appellate Body's Report in
OCTG from Mexico. Simply put, the USDOC could have, during the RPT, clarified its 2000 decision
(for instance by clarifying why it could infer lik ely dumping based on the volume decline), on the
basis of the evidence developed in the 2000 review. Something that the United States chose not to do.
Following the expiration of the RPT, however, in the absence of a WTO-consistent Article 11.3
determination, it should have terminated the measure.

V. SUGGESTION FROM PANEL THAT THE UNITED STATES REVOKE THE
ORDER

13. We believe a suggestion is im portant in this case because of the mandatory rule of termination
and the lapse of rights under the DSU (both the RPT and means of implementation). A suggestion
would provide needed clarity for this dispute, a nd to uphold the meaning of the rights and obligations
embodied in the Agreement. If the outcome of this proceeding is that the United States remains in
non-compliance, and simply tries yet again, Artic les 11.3 and 11.4 are rendered inutile. As our
US colleague said yesterday, we are all intellig ent people. Eventually, USDOC will write a
determination that will be technically sound. Bu t, even at this stage, Argentina's right under
Article 11.3 will not be respected. Article 11.3 requires termination unless a proper "review" and
"determination" is made "at that time." The Unite d States never conducted a proper "review" "at that
time" and cannot do so in the future. It is time to enforce the "rule" of Article 11.3.

ANNEX D-2

OPENING ORAL STATEMENT
OF THE UNITED STATES

12 July 2006

Page

I. INTRODUCTION ............................................................................................................. 23
II. THE WAIVER PROVISIONS ......................................................................................... 24
III. THE SECTION 129 DETERMINATION ....................................................................... 25
IV. CONC LUSION ................................................................................................................. .2 6

I. INTRODUCTION

1. Good morning, Mr. Chairman and members of the Panel. Thank you for the opportunity to
appear before you today.

2. We will not repeat the arguments we have alr eady made in our submissions. Rather, we will
use this statement to highlight a few of the key issues in this dispute. At the outset, the United States
recalls that this is a compliance proceeding. Th e question for this Panel is whether Argentina has
proven that the US measures taken to comply are in consistent with the provisions of the covered
agreements cited by Argentina. We will begin by reviewing what the United States did.

3. The Department of Commerce amended its waiver regulations. Specifically, Commerce
eliminated the "deemed waiver" provisions and amended the "affirmative waiver" provisions such that
a company-specific likelihood determination would be based on an exporter's own statement about its
likely future behaviour. Indeed, Commerce went beyond the recommendations and rulings by
amending the regulations to clarify that interested parties may request hearings in expedited sunset
reviews.

4. After amending the regulations, Commerc e immediately commenced the Section 129
proceeding, even issuing questionna ires the same day the regulations became effective. Before the
parties' submissions were due, Commerce placed additional information on the record – data from
Preston Pipe & Tube and importer data for the period of review – thereby providing interested parties
with the opportunity to comment on the data. R espondent interested parties provided some, but not
all, of the information requested in the questionnair e. In addition, respondent interested parties
submitted comments, domestic interested parties submitted reply rebuttal co mments, and respondent
interested parties subsequently submitted rebuttal on the domestics' rebuttal. Commerce then issued
the revised determination.

5. In response, Argentina pursues an expansiv e number of claims. While the United States does
not dispute Argentina's right to bring claims pursuant to Article 21.5, the United States is surprised at
the nature of some of the claims in this dispute, as well as some of the arguments offered in support
thereof. For example, Argentina alleges a viol ation of Article 6.4 because Commerce did not put
background information about Preston Pipe & Tube on the record of the proceeding until the day the

determination was issued.
1 A second example: Argentina advocates a factual proposition that
actually contradicts the original Panel report, arguing that the statute provides for deemed waivers,
even though the Panel expressly found that those waivers were provided by regulation. 2 T h i s
disregard for the recommendations and rulings in th e original report is emblematic of Argentina's
strategy, which eschews a substantive discussion of the recommendations and rulings from the
original proceeding – even though this is a compliance proceeding, and those recommendations and
rulings form the basis for the evaluation of any claim that the United States has not come into
compliance. Argentina's approach is not su rprising because an examination of the DSB's
recommendations and rulings confirms that the United States has implemented those
recommendations and rulings.

II. THE WAIVER PROVISIONS

6. The United States recalls that the original panel and the Appellate Body found that the
"waiver" provisions were inconsistent with Ar ticle 11.3 because Commerce's order-wide likelihood
determination would be based, at least in part , on "assumptions" about a company's likelihood of
dumping.
3 Commerce amended its sunset regulations to eliminate the possibility that its order-wide
likelihood determinations would be based on "assumptions," and it did so in two ways.

7. First, Commerce eliminated the so-called "d eemed waiver" provision. This means that, by
law, Commerce will not "assume" likelihood for a company that fails to participate in a sunset review.

8. Second, Commerce revised the so-called "affi rmative waiver" provision so that a respondent
interested party has the option to "waive" participation in the sunset review, but an integral part of that
waiver is that the party affirmatively states that it would be likely to dump if the order were revoked.
This ensures that Commerce no longer "assumes" likelihood of dumping for a company electing not
to participate in a sunset review. Instead, the co mpany itself states that it is likely to dump. It is
worth recalling that, as the United States has previ ously explained, the purpose of the "affirmative
waiver" procedure is to permit respondent interested parties to avoid the expense of participating in
the Commerce side of a sunset review when they only wish to contest the likelihood of continuation
or recurrence of injury before the US International Trade Commission.
4 The Antidumping Agreement
does not require the United States to provide this option. Moreover, we note that the filing of a
statement of waiver is, itself, optional. A party could also choose not to participate in the sunset
review by simply not responding to the notice of initiation; Commerce no longer considers such
inaction a "waiver."

9. Argentina argues that the United States was also obligated to amend the statute, rather than
just the regulations, in order to comply with th e DSB's recommendations and rulings. Argentina is
mistaken. The United States recalls that the problem with the "waiver provisions" – that is, the statute
and the regulations collectively – was that they resulted in a company-specific determination based on
an "assumption." That "assumption" arose because the regulations were written to provide for such an
assumption. The regulations are now written so th at no such assumption is permitted: a company-
specific determination would be based on the company's own statement of its likely future behaviour.
Therefore, the regulations now make it clear that, when read together with the statute, no such
assumption exists, and the United States has implemented the DSB's recommendations and rulings.

2 See US Second Submission, paras. 16-17.
4 See, e.g., US First Written Submission (Panel), para. 31 (7 November 2003).

10. Argentina also suggests that the amended s unset regulations are WTO-inconsistent because
they preclude Commerce from arriving at a "reasoned conclusion" on the basis of "positive evidence."
Argentina has still failed to explain why the exporter' s own statement that it is likely to dump is not
"positive evidence;" nor has Argentina explained why such a statement does not provide the basis for
drawing a "reasoned conclusion." As the Appellate Body has noted, the exporter is in the best
position to have information as to its likely fu ture pricing behaviour. If the exporter states that
it is likely to dump, then it is reasonable for the investigating authority to conclude that the
exporter is likely to dump. Argentina apparentl y would like this Panel to find that a company
can go on the record and affirmatively state that it is likely to dump, but then a Member can
retract that statement by bringing a WTO dispute.

III. THE SECTION 129 DETERMINATION

11. Argentina advances both procedural and s ubstantive arguments about the Section 129
Determination – neither is persuasive.

12. As noted above, Commerce placed informati on on the record in ample time for respondent
interested parties to submit comments and rebuttals . Yet Argentina contends that the United States
failed to abide by its obligations under various provisions of Article 6. In doing so, Argentina seeks
to read into those provisions ob ligations to take specific actions that are simply not provided for in
Article 6. What matters for the purposes of comply ing with Article 6 is wh ether the investigating
authority met the "substantive obligations" at issu e, not whether those obligations were met in a
"particular form."
5 As the United States has demonstrated in its submissions, Commerce met its
substantive obligations under Article 6.

13. Argentina misrepresents the US position, stati ng that the United States believes it did not have
enough time to comply with its Article 6 obligations.
6 To the contrary, the United States did comply
with its Article 6 obligations. The United States si mply pointed out that the period of time available
for conducting a particular determination provides context for evaluating whether a Member has met
the substantive obligations in Article 6. For ex ample, what is "timely" and "practicable" under
Article 6.4 may depend at least in part on the am ount of time the investigating authority has to
conduct the proceeding in question.

14. Argentina also contends that the Sec tion 129 Determination was flawed, criticizing
Commerce for examining whether dumping "likely" occu rred over the life of the order. According to
Argentina, Article 11.3 prohibits such an appro ach. Yet, as the Appellate Body has recognized,
Article 11.3 does not specify what factors must be examined, nor does it provide any particular
methodology for examining whether dumping is likely to continue or recur if the order is revoked.
Commerce examined whether it was likely that dumping had continued over the life of the order
because past behaviour can be probative of future behaviour. The totality of information on the
record supported the conclusion that Acindar had likely dumped during the life of the order.

15. Argentina seems to be arguing that Comme rce erred by not calculating a dumping margin.
7
However, the Appellate Body has made clear that th e "silence in the text of Article 11.3 suggests that
no obligation is imposed on investigating authorities to calculate or rely on dumping margins in a
sunset review."8 This is because of the "different nature and purpose of original investigations . . . and
sunset reviews." 9 Dumping margins "may well be relevant to, but they will not necessarily be

5 See US Second Submission, para. 56 (citing Guatemala – Cement II (Panel), para. 8.119).
6 Argentina Second Submission, para. 3.
7 Argentina Second Submission, para. 43.
8 United States – Corrosion Resistant Steel Sunset Review (AB), para. 123.
9 United States – Corrosion Resistant Steel Sunset Review (AB), para. 124.

conclusive of"
10 likelihood of dumping if the order we re revoked. The Appellate Body has
recognized that a sunset review involves a forwar d-looking analysis, and such an analysis – in
contrast to an investigation – does not require th e specific calculation of a number, but rather an
examination of what is likely to occur in the futu re. Argentina has yet to impugn the logic that past
behaviour can be indicative of future behaviour. Indeed, Argentina does not even argue that Acindar
was not dumping over the life of the order. Rather, Argentina's position boils down to this: because
Siderca stopped shipping during the period of review and Acindar did not participate in the original
sunset review, Commerce is prevented from concludi ng that dumping is likely to continue or recur if
the order is revoked. This approach is simply li cense for respondent interested parties to manipulate
proceedings to achieve a particular result, regardless of whether that result is the correct one.

16. In this vein, Argentina also criticizes the inform ation on the record of the proceeding. It is
worth recalling that the paucity of evidence on th e record of the original sunset review was
attributable to respondent interested pa rties. It is well-established that the exporter has access to the
best information as to its likely future pricing be haviour. When the exporter declines to provide that
information, the exporter must accept responsibility for the nature of the information on the record. In
any event, having secured for its companies the opportunity to place information on the record a
second time, Argentina now argues that Commerce was not allowed to collect that information.
Notably, Argentina fails to provi de textual support for its analys is, and, while acknowledging our
point, nevertheless continues to neglect to identify any textual support for its view.

17. The United States is not aware of another instan ce in which a Member has argued that there is
a prohibition on the collection of new inform ation to come into compliance with DSB
recommendations and rulings. Indeed, this argument is little more than a distraction. The United
States notes that Argentina does not contend that Commerce's ultimate conclusion about Acindar's
likely dumping was wrong. Nor does Argentina dispute that Acindar's prices were lower than those in
the US market during the period of review. In stead, Argentina advances a series of procedural
arguments – whether Commerce could look at new information and how Commerce looked at that
information – in an effort to obscure what is plai n: the evidence on the record supports the conclusion
that Acindar likely dumped over the life of the order and that Acindar would likely dump again if the
order were revoked.

18. Argentina also complains that Commerce should have adjusted the US average price data to
compare it better with Acindar's sales price from the importer data. Commerce had to use the price
data in question because no such usable data were provided by the respondents. Regardless,
Argentina is unable to even explain how Commerce c ould have made such adjustments given that the
data from Preston Pipe & Tube was only available in an aggregate form, nor does Argentina even
suggest that, were such adjustments made, Acinda r's prices would have exceeded those of the US
market.

IV. CONCLUSION

19. In sum, Commerce's Section 129 Determinati on and its amended sunset regulations comply
fully with the recommendations and rulings of the DSB. Argentina's claims to the contrary should be
rejected.

20. Thank you, and we look forward to answering any questions you may have.

10 United States – Corrosion Resistant Steel Sunset Review (AB), para. 124.

CLOSING ORAL STATEMENT
OF THE UNITED STATES

13 July 2006

1. The United States recalls that the Appellate Body report in this dispute explains the relevance
of a company-specific finding to an Article 11.3 clai m, where the Article 11.3 determination is made
on an order-wide basis: the question is whether such a company-specific finding tainted the order-
wide determination.
1 Therefore, Argentina must demonstrate that any company-specific finding in
this dispute tainted the order-wide determination.

2. The United States also recalls that it is under no obligation to make a company-specific
finding. Commerce declined to make such a finding regarding Siderca. Therefore, under the
analytical framework set out by the Appellate Body , Commerce cannot have acted inconsistently with
Article 11.3 by not making any finding regarding Siderca.

3. With respect to Acindar, the United States reca lls that Acindar declined to participate in the
original review. According to Argentina, Acinda r did not know about the review. However, as the
Panel may know, the United States initiates sunset reviews automatically and does so via public
notice in the Federal Register. We find it difficu lt to accept a contention that an exporter shipping
merchandise subject to a dumping order was unaware of a sunset review of that order. Moreover,
having now a second opportunity to provide informa tion, Acindar failed to provide some of the
information requested, even to attempt to do so, as Siderca did.

4. In the fact of these facts, Argentina argues th at we could not collect new information to come
into compliance. Argentina argues that Article s 11.3 and 11.4 prevent the collection of new
information. But those provisions are silent on how a Member comes into compliance, and they say
nothing about the collection of new information. The United States initiated its review prior to the
five-year anniversary of the order and completed that review within 12 months. That the review was
later found WTO-inconsistent does not change either of those facts.

5. With regard to Commerce's analysis of Acinda r's likely past dumping, we recall that a sunset
review is a forward-looking analysis. The calcula tion of a dumping margin is not required, nor does
the absence of dumping necessarily require termination. In this proceeding, we were between those
extremes because on exporter st opped shipping and the other began shipping during the period of
review and was not subject to administrative review until after the sunset review period. It is clear
that these facts alone do not mean that dumping is not likely to continue or recur, because we know
that it can, and we know that it has. The question is what factors the investigating authority uses to
analyze likelihood. The Appellate Body has said that no methodology is prescribed.

6. Commerce did not calculate a dumping margin, nor could it have done so, as Argentina
acknowledges, because the companies did not retain those data. There is nothing wrong with that, but
Argentina cannot complain that it is Commerce's fau lt that the data do not exist. Commerce still had
to analyze whether dumping was likely to continue or recur. To make the determination, Commerce
analyzed whether it was likely that Acindar had dumpe d in the past. We do not see that the Appellate
Body has found Article 2 to be directly applicable in situations other than those involving the

1 Appellate Body Report, paras. 231-232.

calculation of a margin.
2 Nevertheless, we consider that Article 2 informs the analysis of likely past
dumping, and Article 2 does provide, and did provide, guidance in this redetermination.

7. Finally, we note that Argentina has spent much of these proceedings putting new facts before
the Panel, including, for example, the US Steel Price List. We cannot reconcile that approach with
Article 17.5(ii) of the Antidumping Agreement. Moreover, Commerce placed the Preston price data
on the record on 22 November; if Argentine respondents considered that the US Steel prices were
more probative, they were free to do so in any of the four submissions they made – Siderca's
30 November comments, 7 December comments, or 14 December comments, or Acindar's
30 November comments, all put on the record after 22 November.

8. This concludes our closing statement. We thank the Panel, the Secretariat, and the
interpreters for their hard work.

2 See, United States – Corrosion Resistant (AB), para. 124.

ANNEX D-3

THIRD PARTY ORAL STATEMENT
OF THE PEOPLE'S REPUBLIC OF CHINA

13 July 2006

1. Mr. Chairman, members of the Panel, it is my great honour to appear before you today to
present the views of China as a third party to th ese proceedings. Since China has made detailed
explanations of its understandings in its written submission, it is not necessary for me to repeat them
during today's third party session. Instead, I woul d like to brief China's understandings from the
following three points.

2. The first point regards the concept of "dumpi ng" in the context of Article 11.3 of the
Antidumping Agreement (the ADA) . In the Section 129 Determination, USDOC compared the
export price of one of the respondent with the prev ailing US market price in reaching its finding of
likely dumping in the sunset review period. In chin a's view, such an approach contradicts with the
fundamental concept of "dumping" set forth in Article 2.1 of the ADA. Thus, the improper
comparison with the prevailing US market price le d to a flawed finding of "likely dumping" which
may not meet the requirement of making a reas oned and adequate determ ination on a sufficient
factual basis as required by Article 11.3 of the ADA.

3. The second point regards the import volume finding in the Section 129 Determination.

In making the Section 129 Determination, the USDO C restated and relied on its previous finding on
import volume in the 2001 sunset review. China subm its that such reliance seems to be inconsistent
with Article 11.3 of the ADA. The USDOC should have conducted a case-specific analysis of the
factors behind the decline in import volumes. The failure to do so seems to be a breach of the
obligations under Article 11.3 of the ADA.

4. The third point is about the USDOC's overall consideration of the factual factors and
conclusion on likelihood of dumping.

5. Firstly, in China's view, under Article 11.3 of the ADA, the conclusion on likelihood of
continuation or recurrence of dumping is one on future events, or say "a prospective determination".
Secondly, as articulated by the Appellate Body, under Article 11.3 of the ADA, the authorities bear
the treaty obligations to "arrive at a reasoned c onclusion" on the basis of "positive evidence". In
China's view, nothing in Article 11.3 provides that such treaty obligations are contingent on the
cooperation of the respondents in the investigati on. The failure by the respondents to provide
necessary information cannot discharge the au thorities from such duties. Thirdly, in US – Corrosion-
Resistant Steel Sunset Review , the Appellate Body effectively held the view that even if dumping has
continued with significant margins and import vol umes after the imposition of antidumping measure,
such facts might only have some validity in formi ng an affirmative likelihood conclusion. It seems to
China, in the current case, the findings made by the USDOC are far from reaching such a level of
certainty. Therefore, it seems difficult to accept th at such findings are sufficient factual bases for
making an affirmative conclusion on likelihood of dumping.

6. Mr. Chairman, this concludes the statem ent of China. Thank you very much for your
attention.

ANNEX D-4

THIRD PARTY ORAL STATEMENT OF
THE EUROPEAN COMMUNITIES

13 July 2006

Page

I. THE ARTICLE 11.3 DETERMINATION ..................................................................... 30
II. NO VALID HISTORICAL DUMPING DETERMINATION....................................... 31
III. ARTICLE 21.5 DSU PROCEEDINGS AND THE PRINCIPLE OF
RES JUDICATA ................................................................................................................ 32
IV. CONFIDENTIAL INFORMATION................................................................................ 33

1. Mr. Chairman, distinguished Members of the Panel.

2. The EC makes this oral statement because of its systemic interest in the correct interpretation
of the GATT 1994, the Anti-Dumping Agreement and the Dispute Settlement Understanding.

3. There are four points the EC wishes to make at this stage.

I. THE ARTICLE 11.3 DETERMINATION

4. First, as set out in our written submission, we wi sh to point out that the measure at issue in the
present implementation proceedings, that is, the "measure taken to comply", is and can only be a
determination within the mean ing of Article 11.3 of the Anti-Dumping Agreement . The US, in an
apparent attempt to obfuscate that fact, insists on referring to the measure taken to comply as a
"Section 129 determination".
1 That may be the correct label in US municipal law; but in WTO law
the correct label is : a determination that the expiry of the duty would be likely to lead to continuation
or recurrence of dumping and injury, such as is provided for in Article 11.3 of the Anti-Dumping
Agreement – or, for short, an Article 11.3 determination.

5. That this is so follows from Article 18.1 of the Anti-Dumping Agreement, according to which
no specific action against dumping from another Member can be taken except in accordance with the
provisions of GATT 1994, as interpreted by the Anti-Dumping Agreement . A "measure taken to
comply" within the meaning of Article 21.5 DS U that nevertheless provides for the continued
imposition of an anti-dumping duty is still a "specifi c action against dumping" within the meaning of
Article 18.1 of the Anti-Dumping Agreement. It must therefore be provide d for in and consistent with
the Anti-Dumping Agreement.
2

1 See, for example, US rebuttal, para 20 and following.
2 Appellate Body Report, US-1916 Act , paras 121 to 126 and 137 : "Article VI, and, in particular,
Article VI:2 read in conjunction with the Anti-Dumping Agreement , limit the permissible responses to
dumping to definitive anti- dumping duties, provisional measures and price undertakings . Therefore, the
1916 Act is inconsistent with Article VI:2 and the Anti-Dumping Agreement to the extent that it provides for

6. The significance of the use of the correct labe l in WTO law is that it highlights the basic point
that the measure taken to comply must be cons istent with all the relevant provisions of the Anti-
Dumping Agreement – notably Articles 11.3 and the relevant provisions of Article 6 in exactly the
same way as and to no lesser degree than any original sunset review determination.3

II. NO VALID HISTORICAL DUMPING DETERMINATION

7. That brings us to the second comment we would like to make today, namely that the
Article 11.3 re-determination has no valid historical dumping determination as its foundation.

8. In this respect, it seems to us that a remark ably simple point has become remarkably – and
unnecessarily, complicated. The truth, as is often the case, is really quite straightforward, and it
consists of four simple steps in the reasoning.

9. First, although a sunset revi ew determination is prospective, it must have as a foundation a
valid historical determination of dumping. If there is nothing in the past, there is simply nothing that
can continue or recur in the future.
4

10. Second, in this case, the only past "dumping" determination ever made is the 1.36 per cent
from the original proceeding, which the US could not lawfully rely on in the Article 11.3 re-
determination, not least because it was calculated using an unlawful zeroing methodology.
5

11. Third, with respect to Acindar, the US has not made any past determination of dumping. It
has merely made a past determination of "likely du mping", which is something different – a point to
which we shall return shortly.

12. Fourth, absent any valid past determination of dumping, the Article 11.3 sunset review re-
determination cannot be consistent with the Anti-Dumping Agreement.

13. Obviously, in reaching this conclusion, it is essential to bear in mind the distinction between
two things : a determination that dumping is likely to continue or recur in the future (one of the
requirements of Article 11.3); and a determination that in the past an exporter was "likely" dumping
(what the US did in the present case). Clearly, th ese are not the same. The first, driven by the
specific requirements of Article 11.3, is prospectiv e in nature, which explains the use of the word
"likely". The second is retrospective in nature and is not provided for anywhere in the Anti-Dumping
Agreement.
6 Its invention by the US in the present case is deeply troubling.

14. A past determination of a dumping margin must be objectively based on the application of the
legal rules provided for in the Anti-Dumping Agreement to the facts , duly evidenced , and in
accordance with the applicable rules of procedure . The insertion by the US of the word "likely" is

"specific action against dumping" in the form of civil and criminal proceedings and penalties."; Appellate Body
Report, US-Offset Act ("Byrd Amendment") , paras 224 to 274, particularly para 265 : "As CDSOA offset
payments are not definitive anti-dumping duties, provisi onal measures or price undertakings, we conclude, in
the light of our finding in US-1916 Act, that CDS OA is not "in accordance with the provisions of the
GATT 1994, as interpreted by" the Anti-Dumping Agreement."; Panel Report, Mexico-Rice, paras 7.273 to 7.278
("… by threatening to impose fines on anyone importing the product subject to an anti-dumping investigation,
Article 93V of the Act clearly provid es for a specific action against dumping or subsidization which is not
provided for in the AD or SCM Agreement.").
3 See, particularly, US rebuttal, para 23, third sentence.
4 EC written observations, para 14.
5 EC written observations, paras 12 to 18.
6 See para. 5 and footnote 2.

destructive to each of these requirements. It su ggests that the legal rules themselves be rendered
subjective; it suggests that the precise rules gove rning which facts and evidence an investigating
authority may or must take into account could be rendered ineffective; and it suggests that the proper
observance of the applicable rules of procedure migh t not be determinative. In the opinion of the EC,
this fundamental and profound watering down of the standards set by the Anti-Dumping Agreement is
manifestly unlawful and wholly unacceptable.
7

15. The US assertion that Article 11.3 "provides no methodology for making a sunset
determination"
8 is no valid answer to this point. That may be true regarding the prospective part of the
determination. But it nevertheless remains the case that Article 11.3 requires a determination about
"continuation or recurrence", both of which terms necessarily include some minimum retrospective
element, in the absence of which, no valid determination can be made.

16. For precisely the same reason, the US assertion that Article 11.3 does not "require a Member
to make an actual determination of dumping"
9 is besides the point, because that relates, at most, to the
question of whether or not any additional finding of dumping must be made. It has nothing to do with
the entirely different situation in which no valid past dumping determination has been made at all.

17. Similarly, the US assertion that Argentina' s position would "enable respondents to manipulate
the system by first depriving the investigating authority of information and then asserting that the lack
of information prevents the investigating authority from continuing the order"
 10 must obviously be
rejected. Evidently, the procedures set out in the Anti-Dumping Agreement amply provide for the
investigating authority to pose the necessary questio ns and, where appropriate, base its determination
on the facts available.

III. ARTICLE 21.5 DSU PROCEEDINGS AND THE PRINCIPLE OF RES JUDICATA

18. The third point on which the EC would like to comment relates to the balance between two
rules : on the one hand, the rule that all aspects of a measure taken to comply can be subject to review
for consistency with the covered agreements in implementation proceedings; and, on the other hand,
the principle of res judicata – that is, the rule that, once a thing is decided by the court, it should not
be the subject of further litigation.
11

19. There are sound and well-known reasons for each of these rules discussed at length in the
case law and in the submissions of the parties, which we do not need to re-iterate. We wish only to
observe that, in our view, there are important differences between the situation that arose in EC –- Bed
Linen and the situation in the present case. In the EC-Bed Linen case, India's claim on the non-
attribution analysis had been rejected by the orig inal Panel and not pursued on appeal, and the re-
determination needed to implement the DSB ruli ng did not have any impact on and thus did not
require any revision of the non-attribution analysis . The question in the Article 21.5 proceeding was
whether or not certain issues concerning the non-attr ibution analysis could be re-litigated in the
context of a measure taken to comply relating to findings that concerned separate issues.

20. In the present case, on the other hand, the focus of the judicial review is on one specific
determination – that of likelihood of continuance or recurrence of dumping – which has been reached
on the basis of a certain number of considerations, taken together. In such circumstances, the EC
tends to agree with Argentina that the Article 11.3 re-determination can only have been based on a

7 Argentina rebuttal, paras 37 to 47.
8 US rebuttal, para 34.
9 US rebuttal, para 34.
10 US rebuttal, paras 34 and 35.
11 US rebuttal, paras 28 to 33.

consideration of all of these factors, taken toge ther, and that, accordingly, all of those factors
necessarily fall within the scope of this Panel's review under Article 21.5 of the DSU.12

IV. CONFIDENTIAL INFORMATION

21. Mr. Chairman, Members of the Panel, the final point on which the EC would like to comment
today relates to the exchanges between the parties concerning confidential information.
13 On this
point, the EC has the following observations.

22. First, the EC observes that the US cannot invoke its domestic law. Its position must be
justified under WTO law. The US appears to agree, itself making the assertion that it is not, in fact,
invoking its domestic law.

23. With respect to WTO law, in the view of the EC, the term "such information" in Article 6.5 of
the Anti-Dumping Agreement should not be interpreted as meani ng "any information". Rather, it
refers back to "information which is by nature c onfidential" or information "which is provided on a
confidential basis by parties to an investigation" and which is, "upon good cause shown" treated as
confidential by the authorities. If, as appears to be so in the present case, there is no special or
particular "good cause shown", the category of conf idential information is indicated in the first
sentence of Article 6.5, at least by way of exam ple. In the opinion of the EC, the "significantly
adverse effect" referred to in that provision cannot include an unfavourable ruling by a panel or the
Appellate Body. Consequently, in the present case, th e real issue would appear to be the risk of a
"significant competitive advantage to a competitor".

24. Turning to the terms "disclosure" and "disclo sed" in Article 6.5, the EC does not understand
these to refer to any disclosure as between any two natural persons. Obviously, for example,
confidential information could be disclosed between two natural persons working within the same
investigating authority. Similarly, the EC does not understand these provisions to preclude disclosure
as between two investigating authorities within the same Member, such as USDOC and the ITC in the
US. Rather, it appears to the EC that Article 6.5 is rather concerned with ensuring that information is
not disclosed by one natural person whose functions are imputable to the Member to another natural
person whose functions are imputed to a competito r of the party submitting the information. Once
again, this appears to the EC to correspond to the true nature of any potential confidentiality issue in
the present case.

25. In short, the EC considers that the US invocation of Article 6.5 of the Anti-Dumping
Agreement does not provide any valid basis for the US to refuse to provide the information to the
Panel
. Nor do we detect any basis on which the information should not be provided to Argentina,
consistent with Articles 12.6 and 18.2 of the DSU, and noting that Argentina is not a competitor of the
undertakings that have provided the information. Furthermore, in our view, Argentina would be
precluded by Article 18.2 DSU and para 3 of the Working Procedures in this case from providing the
information to any competitor
 of the undertakings that have provi ded the information. In most cases,
and probably in the present case, the Panel would be ab le to draft a report that sets out the findings of
fact, the applicability of the relevant provisions and the basic rationale behind any findings and
recommendations that it makes, consistent with Ar ticle 12.7 DSU, without disclosing the confidential
information in its report, and cons istent with Article 17.7 of the Anti-Dumping Agreement and
Article 14.1 of the DSU. If this proves impossible, it should in most cases be possible to resolve the
conflict by finding that, often with the passage of time, and notwithsta nding assertions by the party
providing the information, information is no longer in fact confidential. Failing that, the Panel can
produce a non-confidential version of its report for non-parties. A similar approach would apply to

12 Argentina rebuttal, paras 69 to 80 and 81 to 98.
13 Particularly Argentina letters dated 14 and 28 June 2006; US letters dated 22 and 30 June 2006.

the Appellate Body.
14 The EC therefore disagrees with the US assertion that, absent authorisation
from the source of the information, it is precluded by Article 6.5 of the Anti-Dumping Agreement
from releasing the information to the Panel and Argentina.15

26. The US is entitled to agree with Argentina or seek from the Panel additional safeguards
regarding information disclosed to Argentina, for example limiting the natural persons who may
access information; limiting the number of copies or the form in which information may be stored;
circumscribing the place in which and the manner in which information may be held; limiting the
period of time for which such information may be held; and providing for its destruction once panel
and eventually appellate procedures ha ve finished. Footnote 17 of the Anti-Dumping Agreement
provides context to support that view.

27. However, the US is not entitled to rely on a confidentiality concern such as that apparently
arising in this case in order to withhold inform ation and/or agreement to additional procedures
indefinitely. Eventually, the Panel can and should decide on what additional safeguards, if any, are
necessary; require the US to produce the inform ation; and provide the parties with adequate
opportunity to exchange argument in relation to the information.

28. The EC agrees with the US that the Panel has a discretion under Article 13 of the DSU, but
takes the view that this discreti on must be exercised on the basis of sound reasons and that, in the
interests of settling the dispute, the Panel should tend to exercise that discretion by requiring the
relevant information to be produced.

29. With regard to inferences, the EC tak es the view that administrative and judicial
determinations invariably generally involve more or less inference, depending on the density of
factual information, the legal rules to be applied, a nd the procedures that have been followed. This is
so in the present case, as in any other.

30. With regard to the concept of "adverse" infe rence, the EC considers that the Panel is not
entitled to select and prefer one particular inference over another only because it leads to a result that
is less favourable or punitive to one party. However, the Panel is en titled to draw inferences, and it is
possible that the result is less favourable to the party refusing to disclose the relevant information than
the result that would follow if the information woul d be disclosed, without th at vitiating the Panel's
analysis. The US would appear to agree.
16

31. In this particular case the EC finds it notable that the US makes the remarkable and
incomprehensible statement that "the actual numbers used are simply not germane to this dispute"
17 –
a statement that rather confirms the overwhelming impression that the actual facts in this case were
simply considered by USDOC "not germane" to the (pre-determined) conclusion reached in the
Article 11.3 re-determination. Indeed, in the view of the EC, the sense of unreality that pervades the
measure taken to comply is largely explained by th is more or less complete dislocation of fact and
outcome.

 Mr. Chairman, distinguished Members of the Panel, thank you for your attention.

14 Working Procedures for Appellate Review, Article 25 (Transmittal of Record).
16 US letter dated 22 June 2006, paras 10 and 11.
17 US letter dated 22 June 2006, page 2, echoing US rebuttal, para 33: "The information was not
germane to the question at hand."

32. Mr. Chairman, distinguished Members of the Panel. Listening to the other third party
submissions and the comments of Argentina, the EC has one closing remark, and it is this. The EC
may claim some paternity for the sunset review provisions, these being new in the Uruguay Round
Anti-Dumping Agreement, insofar as we supported the insertion of such a provision. We agree with
the Appellate Body that termination is the general ru le, extension being in the nature of an exception.
It is therefore with some dismay that we have observed the manner in which this provision has been
applied by the US, in case after case, measures inva riably being extended, often on the basis of the
most flimsy analysis. The game see ms to be to spread the paint as thinly as possible, in the hope that
the cracks will not show through. In its wisdom, this Panel was not fooled. It put its finger on one of
the cracks, probably the most important, that bei ng that one cannot assume that simply because cash
deposits are paid, dumping has occurred. OK says the US, lets get rid of that determination of
dumping and replace it with a determination of likely dumping – something that actually makes the
justification for the measure weaker, not stronger. Thus, behind the fragile edifice of this measure
taken to comply, and the sea of words offered by the US by way of ex-post rationalisation, there lies,
in truth, a direct challenge to the authority and credibility of this Panel.

ANNEX D-5

THIRD PARTY ORAL STATEMENT
OF JAPAN

13 July 2006

Page

I. INTRODUCTION..............................................................................................................36
II. BASIC CO NCERNS ..........................................................................................................36
III. SPECIFIC ARGUMENTS ................................................................................................37
A. THE USDOC'S RE-DETERMINATION OF THE LIKELIHOOD OF DUMPING IS
INCONSISTENT WITH ARTICLE 11.3 OF THE AD AGREEMENT .......................................... 37
B. THE UNITED STATES FAILS TO PROPERLY UNDERSTAND THE SCOPE OF THE
TERMS OF REFERENCE OF THE PANEL, AND THE MEANING OF THE
RECOMMENDATIONS AND RULINGS BY THE DSB............................................................... 37
C. THE USDOC'S RE-DETERMINATION OF THE LIKELIHOOD OF DUMPING IS
INCONSISTENT WITH ARTICLE 6 OF THE AD AGREEMENT ............................................... 39
D. WAIVER PROVISIONS........................................................................................................... ........ 39
IV. CONC LUSION................................................................................................................. ..40

I. INTRODUCTION

1. Mr. Chairman and distinguished Members of the panel, on behalf of the Government of
Japan, I would first like to express our appreciation for the opportunity to submit our views in this
dispute as a third party to the Panel. This morni ng, we will not repeat our arguments in our written
submission. Rather, we would like to focus on cer tain arguments presented by parties in their second
written submissions.

II. BASIC CONCERNS

2. Japan has concerns about the United Stat es' measure taken to comply with the DSB
recommendations and rulings, and has a systemic inter est in this case from the viewpoint of ensuring
the observance of the disciplines of the AD Agreement through dispute settlement procedures.

3. We are concerned in this proceeding that di sciplines set forth in the AD Agreement would be
rendered meaningless if the authorities who acted inconsiste ntly with the AD Agreement may later
make a re-determination ignoring disciplines in the AD Agreement. We are also concerned that the
amendment to the waiver provisions is not fully consistent with the AD Agreement.

III. SPECIFIC ARGUMENTS

A. THE USDOC'S RE-DETERMINATION OF THE LIKELIHOOD OF DUMPING IS INCONSISTENT
WITH ARTICLE 11.3 OF THE AD AGREEMENT

4. Japan is concerned that the URAA Section 129 Determination is not fu lly consistent with
Article 11.3 of the AD Agreement, despite the United States' contention.

5. We agree that, as the United States argues, 1 the authorities do not have to rely on past
dumping "margins" in making the "like lihood" determination. However, once the authorities decide
to "rely upon the existence of dumping over the life of the measure as part of [the likelihood]
determination, it has to have an adequate factual basis for so concluding,"
2 including changes in the
exporters' "export or home market price, or, their cost of production" during the period of review.3

6. The United States contends that "there is no reason why it cannot be acceptable to continue an
order when the existence of dumping over the life of the order was likely." 4 We disagree. The
USDOC's finding that dumping was likely in the past is speculative and in this case does not serve as
an adequate factual basis for the determination whether or not dumping is likely in the future.

7. Admittedly, the investigating authorities ' conclusion of the likelihood of dumping in the
future by its nature has a speculative aspect. Howe ver, the obligation under Article 11.3 "to
'determine' the likelihood of continuation or recurrence of dumping requires … a reasoned finding on
the basis of positive evidence that dumping is likely." 5 Japan does not agree that mere speculation
regarding the past can be an adequate factual basis for further speculation regarding any future
dumping, unless further reasoning of an adequate factual basis for the likelihood is provided.

8. Therefore, the USDOC's speculation regardi ng past dumping does not seem to constitute an
adequate factual basis to conclude that dumping is likely in the future.

B. THE UNITED STATES FAILS TO PROPERLY UNDERSTAND THE SCOPE OF THE TERMS OF
REFERENCE OF THE PANEL, AND THE MEANING OF THE RECOMMENDATIONS AND
RULINGS BY THE DSB

9. The United States contends that it can conti nue to rely on the decline of volume as a major
factor in determining the likelihood of dumping, b ecause the "original Panel made no finding that the
United States had acted inconsistently with its WTO obligations in connection with its volume
analysis."6 We are of the view that further analysis is necessary to determine whether the United
States can rely on the decline of volume as a major factor in determining the likelihood of dumping, in
light of the original Panel's finding.

10. Firstly
, the original Panel did not find the USDOC's volume analysis to be valid. It simply
did not make a finding. This was because the original Panel had already found the USDOC's
determination to be inco nsistent with the AD Agreement on another ground. 7 T h i s d o e s n o t
necessarily mean that the volume analysis is not subj ect to review by this Panel. As the Appellate

1 US Second Written Submission, paragraphs 34, 35 and 37.
2 Panel Report, United States – Sunset Reviews of Anti-Dumping Measures on Oil Country Tubular
Goods from Argentina (US – OCTG Sunset Reviews) , WT/DS268/R, adopted 17 December 2004, as modified
by the Appellate Body Report, para. 7.219 (emphasis added).
3 Ibid.
4 US Second Written Submission, paragraph 35 (emphasis added).
5 Panel Report, supra note 2, para. 7.211, emphasis added.
6 US Second Written Submission, paragraph 31.
7 Panel Report, supra note 2, paragraph 7.221.

Body in US-Softwood Lumber IV (Article 21.5-Canada) has stated, "a panel's mandate under
Article 21.5 of the DSU is not necessarily limited to … [a] measure declared to be 'taken to comply'
… [M]easures with a particularly close relationship to the declared 'measure to comply', and to the
recommendations and rulings of the DSB, may also be susceptible to review by a panel acting under
Article 21.5."
8

11. As we have stated in our written submissi on, we do not take any specific position on the
factual aspect of this issue. However, the United States' argument that the absence of finding on the
volume analysis by the original Panel rules it out from the terms of reference of this Panel is
questionable. As the original Panel found, "the USDOC's likelihood determination in this sunset
review was based on two factual findings, i.e. first dumping continued over the life of the measure and
second import volumes declined following the imposition." 9 Under the circumstances in which the
original Panel made a finding on the former, the latter issue seems to have a sufficiently close
relationship to the DSB recommendations and rulings regarding the original Panel's findings.

12. Thus we respectfully ask the Panel to determine whether such a close link exists in light of the
original Panel's analysis.

13. Secondly
, we also question the United States' contention that it "was under no obligation to
take an action with respect to the volume analysis , [and it would be unfair if the compliance] Panel
considers that analysis deficient. The United States could then be faced with a request for
authorization to suspend concessions, with no reasona ble period of time to bring the measure into
compliance."10 By requesting the United States "to bring its measures ... into conformity with its
obligations under the [AD] Agreement," 11 the DSB requested the United States bring its measures
entirely into conformity with the AD Agreement. If the close link exists between the measure subject
to the findings of the original Panel and the vo lume analysis, this would include re-considering
whether the volume analysis can serve as an adequa te factual basis to bring that measure into
compliance.

14. Therefore, to the extent that the relationshi p between the analysis of the decline in volume,
and the United States' measure found to be inconsistent with the AD Ag reement in the original Panel,
is found to be "close", and that the analysis of the decline in volume is a "measure taken to comply",
the United States had more than one year since th e DSB's adoption of the Appellate Body Report in
December 2004 to adjust the measures to be consistent with the AD Agreement.

8 Appellate Body Report, United States – Final Countervailing Duty Determination with Respect to
Certain Softwood Lumber from Canada, Recourse to Article 21.5 of the DSU by Canada, WTO/DS257/AB/RW,
adopted 17 December, 2004, paragraph 77 (emphases added).
9 Panel Report, Supra note 7 (emphases added).
10 US Second Written Submission, paragraphs 30-31.
11 Appellate Body Report, United States - Sunset Reviews of Anti-Dumping Measures on Oil Country
Tubular Goods from Argentina (US-OCTG Sunset Reviews) , WT/DS268/AB/R, adopted 17 December 2004,
para. 366.

C. THE USDOC'S RE-DETERMINATION OF THE LIKELIHOOD OF DUMPING IS INCONSISTENT
WITH ARTICLE 6 OF THE AD AGREEMENT

15. The URAA Section 129 Determination did not comply with Article 6, inter alia, Article 6.9.
It is apparent that the USDOC did not issue a preliminary determination nor identify essential facts
which formed the basis of its final determination in any other form. The inaction is inconsistent with
the first sentence of Article 6.9, which requires the authorities to "inform all interested parties of the
essential facts … which form the basis for the decision" and to provide "sufficient time for the parties
to defend their interests." This also contradicts with the argument by the United States in its First
Written Submission that "[The DOC] satisfied all of the procedural obligations of Article 6."12

16. The authorities at least have to identify the facts that were essential for reaching a final
determination. The point is that the USDOC seems to have failed to let exporters know what the
essential facts were in the first place. It is not an issue of whether the authorities have to disclose facts
not used for the basis of its final determination or whether they have to provide "reasons" why they
are not used. The United States' reference to Argentina – Poultry
13 is not relevant in this regard.

17. The panel's finding in Argentina
– Floor Tiles indicated below is a more apt reference:

the exp exporters could not be aware in th is case, simply by reviewing the complete
record of the investigation, [which] evidence form the primary basis for the
determination of the existence and extent of dumping [and therefore, the authorities]
failed to put the exporters on notice of an essential fact under consideration. As a
result, the exporters were unable to defe nd their interests within the meaning of
Article 6.914
18. The USDOC did not, in this case, put the expor ters on notice of information they used as a
primary basis for the determination of the likelihood of dumping. This failure hindered the exporters
from defending their interests. Thus, the USDOC acted inconsistently with Article 6.9.

D. WAIVER PROVISIONS

19. Japan is concerned with the consistency of the United States' waiver provisions with
Article 11.3 of the AD Agreement, as Section 751(c)(4)(B), that is inconsistent with the
AD Agreement as such, remains unchanged.

20. Our point of concern is that it is the authorities that bear the burden of proof to establish the
likelihood of dumping, either company-specific or order-wide, examining all relevant evidence in a
specific case; the authorities may not predetermine the conclusion solely on a piece of evidence
without examining any other evidence. By maintaining Section 751(c)(4)(B) as it is, the United States
assumes that a company's own admission alone is sufficient in every case , irrespective of other

13 US Second Written Submission, paras. 79-84. See Panel Report, Argentina B Definitive Anti-
Dumping Duties on Poultry from Brazil, WT/DS241/R, adopted 19 May 2003, paras. 7.221-7.230.
14 Panel Report, Argentina – Definitive Anti-Dumping Measures on Imports of Ceramic Floor Tiles
from Italy, WT/DS189/R, adopted 5 November 2001, para. 6.129 (emphasis added).

evidence. However, there could be cases where th e authorities should consider other factors on the
basis of information obtained on their own or from other interested parties.

21. Lacking adequate clarification on why Sec tion 751(c)(4)(B) remains, the United States does
not seem to have fully complied with the DSB's recommendations and rulings.

IV. CONCLUSION

22. Again, Japan very much appreciates the opportunity to present its views to this Panel.

ANNEX D-6

THIRD PARTY ORAL STATEMENT
OF MEXICO

Page

I. INTRODUCTION ............................................................................................................. 41
II. THE SECTION 129 DETERMINATION IS INCONSISTENT
WITH THE RECOMMENDATIONS AND RULINGS OF THE DSB,
AND IS ALSO INCONSISTENT WITH THE WTO OBLIGATIONS OF THE
UNITED STATES.............................................................................................................. 42
A. THE DOC FAILED TO COMPLY WITH THE REQUIREMENTS OF ARTICLE 11.3
OF THE ANTI-DUMPING AGREEMENT ......................................................................................42
B. THE DOC'S LIKELIHOOD OF DUMPING INFERENCE BASED ON THE DECLINE IN
IMPORT VOLUME IS A MEASURE TAKEN TO COMPLY ........................................................43
C. THE DOC FAILED TO CONDUCT A CASE-SPECIFIC ANALYSIS OF THE REASON
BEHIND THE DECLINE IN VOLUME...........................................................................................44
D. IN ORDER TO GIVE MEANING TO ARTICLE 11.3 IN THE CASE AT ISSUE,
THE ANTI-DUMPING MEASURE SHOULD BE REVOKED.......................................................44

I. INTRODUCTION

Mr Chairman, Members of the Panel,

1. The Government of Mexico welcomes this opp ortunity to address the systemic issues that are
highly germane to this case. Mexico considers th at the United States has failed to implement the
recommendations and rulings of the DSB in this dis pute. The United States maintains in force an
anti-dumping order against Argentine products even though the DSB established that the measure was
inconsistent with WTO legislation. It has been mo re than five years since the United States extended
the anti-dumping duties. Although it has had sufficient time and a fresh opportunity to comply, the
United States refuses to bring its measure into c onformity. Today, Mexico's will put forward
comments on the following points:

• First, the terms of Article 11.3 are to be interpreted in such a manner as to be
meaningful. This is crucial, because it is the words that create the duties and
obligations of Members. The United States Department of Commerce (DOC) issued a
decision which does not even come close to meeting the requirement of establishing –
on the basis of positive evidence – that dumping would be "likely" to continue or recur
if the anti-dumping measure on oil country tubular goods (OCTG) from Argentina
were to be revoked. In 2000, the DOC did not conduct the kind of "review" or make
the kind of "determination" required under Artic le 11.3. Mexico's view is that the
DOC cannot seek to satisfy these requirements fo r the first time in 2005. In any event,
the determination finally issued by the DOC in 2005 is inconsistent with Article 11.3.

• Second, the Panel should find whether the DOC is empowered under the
Anti-Dumping Agreement to infer, without any substantive analysis, that dumping
would be likely, by relying on the decline in import volume or the cessation of imports.

The Panel should dismiss the untenable pos ition of the United States that the DOC's
inference of likely dumping, based on the decline in imports, is not part of the measure
taken to comply by the United States in th is case. The Section 129 Determination is
the measure taken to comply with the recommendations and rulings of the DSB. WTO
precedents have made this clear. Mexico therefore holds that the "measure taken to
comply" includes the fact that the DOC relies on the decline in import volume in order
to determine that dumping would be likely.

• Third, the DOC did not undertake any analysis of the reasons why the volume of
imports diminished. The Section 129 Determ ination leaves no doubt in this regard.
The Appellate Body has confirmed that su ch an approach is inconsistent with
Article 11.3. To assume likelihood of dumpi ng on the basis of volume decline in the
absence of any analysis cannot serve as a basis for an Article 11.3-consistent
determination. Mexico respectfully requests the Panel to rule on this point.

• Lastly, this case will serve as an important test for determining whether or not
Article 11.3 incorporates substantive obliga tions. According to Mexico, cases such as
this one – in which there is insufficien t positive evidence for continuation of the
anti-dumping duties – should lead to revocation of the measure, in conformity with the
Anti-Dumping Agreement itself.

II. THE SECTION 129 D ETERMINATION IS INCONSISTENT WITH THE
RECOMMENDATIONS AND RULINGS OF THE DSB, AND IS ALSO
INCONSISTENT WITH THE WTO OBLIGATIONS OF THE UNITED STATES

A. THE DOC FAILED TO COMPLY WITH THE REQUIREMENTS OF ARTICLE 11.3 OF THE
ANTI-DUMPING AGREEMENT

2. Article 3.2 of the DSU reaffirms that one of the objectives of the WTO dispute settlement
mechanism is to "to clarify the existing provisions of those agreements in accordance with customary
rules of interpretation of public international law" . One fundamental principle of these rules is that
"interpretation must give meaning and effect to all th e terms of a treaty. An interpreter is not free to
adopt a reading that would result in reducing whole clauses or paragraphs of a treaty to redundancy or
inutility".1

3. On the basis of the language of Article 11. 3, as clarified by the Appellate Body, the
United States is under the obligation to terminat e the anti-dumping order on OCTG from Argentina,
unless the DOC were to make findings consistent with the requirements under that Article. In order to
invoke the exception for extending the measure, th e DOC was compelled to undertake a "review"
prior to August 2000 and to "determine" that "termi nation of the duty would lead to continuation or
recurrence of injury and dumping".

4. The DOC did not satisfy the requirements of Article 11.3 in 2000, nor did it subsequently
revoke the order. As the Section 129 Determin ation plainly shows, in 2005 the DOC once again
failed to comply with the provisions of Article 11.3.

5. Moreover, Mexico concurs with Argen tina's position that the United States acted
inconsistently with Article 11.3 in basing its 2005 likelihood of dumping determination on factual
evidence that the DOC did not develop in the original sunset review.

1 Appellate Body Report, United States – Standards for Reformulated and Conventional Gasoline ,
WT/DS2/AB/R, adopted on 20 May 1996, page 23; Appellate Body Report, United States – Import Prohibition
of Certain Shrimp and Shrimp Products, WT/DS58/AB/R, adopted on 6 November 1998, para. 121.

6. The obligation contained in Article 11.3 is no longer meaningful where a Member is granted
multiple opportunities beyond the prescribed five year s (plus one for the review) for conducting the
sunset review.

B. THE DOC'S LIKELIHOOD OF DUMPING INFERENCE BASED ON THE DECLINE IN IMPORT
VOLUME IS A MEASURE TAKEN TO COMPLY

7. Mexico requests that the Panel reject the United States' position that volume findings do not
constitute part of the measure taken to comply.2

8. First, for the purposes of Article 21.5 of the DSU, a Section 129 determination of the
United States is a "measure taken to comply" with WTO obligations, including the rulings and
recommendations of the DSB. The object of Secti on 129 of the "Uruguay Round Agreements Act" is
to enable the United States to bring itself into c onformity with its WTO obligations, including those
under the Anti-Dumping Agreement. The decisions of the Appellate Body in US – Lumber ITC
Investigation (Article 21.5 – Canada) and of the Panel in US – Countervailing Measures on Certain
Products from the EC (Article 21.5 – EC) concur that the Section 129 Determination of the
United States is the "measure taken to comply".
3

9. Second, the Section 129 Determination speci fically used the DOC's import volume findings
from the original sunset review; these findings c onstitute an inseparable element of the "measures
taken to comply". A reading of the Section 129 De termination leaves no room for uncertainty in this
respect.

10. At page 11 of the Section 129 Determination, the DOC confirms that it relied on the volume
finding:

In assessing likelihood, we also rely on our previous finding regarding the volume of
imports of subject merchandise for the period before and the period after the issuance
of the antidumping duty order. In the or iginal sunset review, we found that after
imposition of the order, import volumes significantly decreased from pre-order levels.
[citations omitted]. Declining import volu mes after, and apparently resulting from,
imposition of an antidumping duty order indicate that exporters would need to dump
to sell at pre-order levels. (Emphasis added.)
11. The last sentence cited is of particular signi ficance. The DOC contends that volume decline
is sufficient to show that exporters need to dump , and that the decline in question results – apparently
– from the original measure. This is an important aspect of the measure taken to comply, which must
be evaluated by the Panel.

12. Thus, the Appellate Body's ruling in EC – Bed Linen (21.5 ) clearly does not apply in the case
at issue since – contrary to the United States' argument – the DOC's import volume finding does not
constitute a "part of the redetermination that merely incorporates elements of the original
determination".
4

2 See Second Submission of the United States, para. 28; see also First Written Submission of the
United States, para. 34.
3 See Appellate Body Report, United States – Investigation of the International Trade Commission in
Softwood Lumber from Canada , recourse to Article 21.5 of the DSU , WT/DS277/AB/RW, circulated on
4 Appellate Body Report, European Communities – Anti-Dumping Duties on Imports of Cotton-Type
Bed Linen from India – Recourse to Article 21.5 of the DSU by India, WT/DS141/AB/RW, para. 86.

C. THE DOC FAILED TO CONDUCT A CASE-SPECIFIC ANALYSIS OF THE REASON BEHIND
THE DECLINE IN VOLUME

13. The Section 129 Determination confirms that the DOC failed to analyse volume decline. This
approach is incorrect and contrary to the oblig ations of the United States under the WTO. The
Appellate Body stated that a case-specific analys is of the reasons behind a decline in volume will
always be necessary, and that an authority may not use post-order decline as evidence of likely
dumping. Specifically, the Appellate Body establishe d that in making an Article 11.3-consistent
determination "a case-specific analysis of the f actors behind a cessation of imports or a decline in
import volumes [...] will be necessary".5

14. The Appellate Body acknowle dged that numerous factors can reasonably explain a decline in
import volume or the cessation of imports following the imposition of anti-dumping duties. It also
noted that diminishing volumes may be caused by changes in the competitive conditions of the
market-place or strategies of exporters, rather than by the anti-dumping measure alone. In this case,
although Argentina's interested parties sought to present such evidence, the Section 129
Determination does not reflect any analysis of such arguments by the DOC.
6

15. Mexico recalls that in US – OCTG from Mexico the Appellate Body reaffirmed that in the
case of diminishing import volumes, the administeri ng authority may not rely on presumptions or
conjecture regarding a company's ability to export without dumping. 7 Nevertheless, this is precisely
what the DOC did in 2000 and did again in 2005. This clearly emerges from the statement drawn
from the Section 129 Determination referred to earlier.

16. Such an approach is entirely inconsistent with the obligations of the United States under
Article 11.3 of the Agreement.

D. IN ORDER TO GIVE MEANING TO ARTICLE 11.3 IN THE CASE AT ISSUE, THE ANTI-
DUMPING MEASURE SHOULD BE REVOKED

17. Article 11.3 requires a specific outcome (the termination of anti-dumping duties) at a given
moment in time, unless the importing Member satisfies the requisite conditions for continuing the
anti-dumping measure. Clearly, the United States decide d in 2000 to extend the order in spite of the
fact that it did not satisfy the Article 11.3 conditi ons. The United States maintains the order to date
and recently began the proceeding to extend the anti-dumping duties for another five years.

18. In conclusion, Mexico considers that the DOC's determination once again fails to comply
with the requirements laid down in Article 11.3. The United States has disregarded the international
commitments it undertook in the WTO by unlawfully maintaining the anti-dumping order over the
past six years. That being the case, Mexico re quests that the Panel exer cise its discretion under
Article 19.1 of the DSU, as Argentina has requested , and suggest that the United States revoke the
measure in order to come into compliance with its WTO obligations.

19. The Government of Mexico thanks the Pane l for its time and for the opportunity to put
forward these comments.

5Appellate Body Report, United States – Sunset Review of Anti-Dumping Duties on Corrosion-
Resistant Carbon Steel Flat Products from Japan, WT/DS244/AB/R, para. 177.
6 See First Written Submission of Argentina, paras 69-80; second written submission by Argentina,
paras 122-132.
7 Appellate Body Report, US – OCTG from Mexico, para. 199.