UNITED STATES – ANTI-DUMPING AND COUNTERVAILING DUTIES ON RIPE OLIVES FROM SPAIN RECOURSE TO ARTICLE 21.5 OF THE DSU BY THE EUROPEAN UNION REQUEST FOR CONSULTATIONS
Document: REQUEST FOR CONSULTATIONS
Date: 2 May 2023
Document codes: WT/DS577/15
Complainant: EU
Respondent: U.S.
Third parties: Australia, Brazil, Canada, China, India, Japan, Mexico, Russia, Saudi Arabia, Switzerland, Turkey
Dispute stage: Panel
Agreements cited: Art. 1.1(a), 1.1(b), 1.2, 2.1(a), 2.1(b), 2.1(c), 2.4, 10, 14, 15.1, 15.2, 15.5, 19.1, 19.3, 19.4, 22.5, 32.1  Subsidies and Countervailing Measures (SCM)

UNITED STATES – ANTI-DUMPING AND COUNTERVAILING DUTIES ON RIPE OLIVES
FROM SPAIN
RECOURSE TO ARTICLE 21.5 OF THE DSU BY THE EUROPEAN UNION
REQUEST FOR CONSULTATIONS
The following communication, dated 28 April 2023, from the delegation of the European Union to
the delegation of the United States, is circulated to the Dispute Settlement Body in accordance with
Article 21.5 of the DSU.

My authorities have instructed me to request consultations with the United States pursuant to
Articles 1, 4 and 21.5 of the WTO Understanding on Rules and Procedures Governing the Settlement
of Disputes (DSU), Article 30 of the Agreement on Subsidies and Countervailing Measures
(SCM Agreement), and Article XXIII of the General Agreement on Tariffs and Trade 1994
(GATT 1994), concerning the anti -dumping and countervailing duties on ripe olives from Spain
imposed by the United States, and concerning a "disagreement as to the existence or consistency
with a covered agreement of measures taken to comply with recommendations and rulings" in DS577
United States – Anti-dumping and Countervailing Duties on Ripe Olives from Spain.
In that regard, the European Union also refers to the "Understanding between the United States and
the European Union Regarding Procedures under Articles 21 and 22 of the DSU", dated 13 February
2023 ("Sequencing Agreement"), which apply "for the exclusive purposes of this dispute" and in
particular point 1 thereof, which governs the procedures for the Parties to consult for purposes of
compliance proceedings in this dispute.1
On 20 December 2021, the Dispute Settlement Body ("DSB") adopted the panel report in case DS577
United States — Anti-dumping and countervailing duties on ripe olives from Spain (h ereafter the
"panel report").2
With respect to the European Union's claims in relation to Section 771B of the Tariff Act of 1930
(Section 771B) and its application in the ripe olives countervailing duty investigation, the panel
found, inter alia, that (i) Section 771B is as such incons istent with the United States' obligations
under Article VI:3 of the GATT 1994 and Article 10 of the SCM Agreement because it requires the
United States Department of Commerce (USDOC) to presume that the entire benefit of a subsidy
provided in respect of a raw agricultural input product passes through to the downstream processed
agricultural product, based on a consideration of only two factual circumstances prescribed in that
provision, without leaving open the possibility of taking into account any other factors that may be
relevant to the determination of whether there is any pass -through and, if so, its degree; and
(ii) through the application of Section 771B of the Tariff Act of 1930 in the Spanish ripe olives
investigation the United States acted incon sistently with its obligations under Article VI:3 of the
GATT 1994 and Article 10 of the SCM Agreement to establish the existence and extent of indirect
subsidisation (i.e. pass-through) taking into account all relevant facts and circumstances.

1 WT/DS577/14.
2 Dispute Settlement Body, Minutes of 22 February 2022 WT/DSB/M/459, para. 7.

The panel therefore recommended that the United States bring its measures into conformity with its
obligations under the GATT 1994, and the SCM Agreement.
On 1 July 2022, the United States and the European Union agreed that the reasonable period of time
("RPT") for the United States to implement the recommendations and rulings of the DSB would
expire on 14 January 2023. 3 This long RPT of twelve (12) months and twenty -five (25) days was
accepted by the European Union on the understanding that such time was needed for the legislative
amendment of Section 771B.
On 20 December 2022, the USDOC issued its final determination under section 129 of the
Uruguay Round Agreements Act (URAA), intended to implement the recommendations and findings
of the DSB in this dispute (Final Determination). On 12 January 2023, the U.S. Trade Representative
(USTR) directed USDOC to implement the Final Determination. USDOC issued a notice to that effect
on 13 January 2023.
On 16 January 2023, the United States communicated to the DSB the Stat us Report Regarding
Implementation of the DSB Recommendations and Rulings by the United States and stated that it
had completed its implementation of the DSB's recommendations in this dispute.4
As regards the finding of the panel on the incompatibility wi th WTO rules of Section 771B, the
Final Determination confirmed that Section 771B remains U.S. law, i.e. had not been modified. On
the contrary, on the basis of similar arguments that had been rejected in the panel proceedings, the
section 129 proceedings concluded that a WTO consistent implementation is permissible under the
terms of Section 771B because USDOC would allegedly be permitted to take into account all relevant
information in its pass-through analysis under Section 771B.
The European Union (EU) disagrees with the United States as to the existence and consistency with
the covered agreements of the measures the United States have taken to comply with the DSB
recommendations and rulings in DS577 United States – Anti-dumping and Countervailing Duties on
Ripe Olives from Spain, as further detailed below.
The measures at issue
The measures at issue include:
- the Final Determination of the USDOC of 20 December 2022 under section 129 of the URAA,
regarding the countervailing duty (CVD) investigation of ripe olives from Spain 5 applicable as of
12 January 2023 as well as USDOC's notice of implementation of 13 January 20236;
- the Preliminary Determination Memorandum of the USDOC of 23 September 20227;
- Section 771B of the Tariff Act of 1930 ,8 insofar as the inconsistency with Article VI:3 of the
GATT 1994 and Article 10 of the SCM Agreement has not been removed.
Insofar as the Final Determination effectively amends and maintains in force and effect the CVD duty
order issued on 1 August 2018 by the USDOC and applicable as from the same date, it should also
be considered as measure at issue, at least with regard to the parts pertaining to the findings of the

3 WT/DS577/12.
4 WT/DS577/13.
5 https://www.federalregister.gov/documents/2023/01/19/2023-00930/ripe-olives-from-spain-
implementation-of-determination-under-section-129-of-the-uruguay-round and
https://www.govinfo.gov/content/pkg/FR-2023-01-19/pdf/2023-00930.pdf.
6 On January 12, 2023, the U.S. Trade Representative (USTR) directed Commerce to implement the
section 129 final determination. Commerce issued a notice to that effect on January 13, 2023. The notice of
the completed implementation was published in the U.S. Federal Register on 19 January, 2023, and can be
found at 88 Fed. Reg. 3384. https://www.federalregister.gov/documents/2023/01/19/2023-00930/ripe-olives-
from-spain-implementation-of-determination-under-section-129-of-the-uruguay-round
7 Memorandum, "Ripe Olives from Spain: Preliminary Section 129 Determination Regarding the
Countervailing Duty Investigation," dated September 23, 2022 (Preliminary Determination).
8 19 U.S.C. § 1677-2.

panel report concerning the incompatibility as such and as applied with the WTO agreeme nts in
relation to Section 771B.9
The legal basis for the complaint and the reasons for the request

Each of the measures at issue, considered individually in isolation or in any combination, appears to
be inconsistent with the United States' obligations under Article 10 of the SCM Agreement and
Article VI:3 of the GATT 1994.
This is, first, because the United States did not take any measures to remove the "as such"
inconsistency of Section 771B with Article VI:3 of the GATT 1994 and Article 10 of the Agr eement
on Subsidies and Countervailing Measures. In particular, the United States has not repealed or
amended Section 771B. Therefore, Section 771B remains "as such" inconsistent with Article VI:3 of
the GATT 1994 and Article 10 of the Agreement on Subsidi es and Countervailing Measures and the
United States has failed to implement the DSB's recommendations and rulings.
Second, no "as applied" pass -through analysis based on Section 771B that the panel report found
"as such" incompatible with Article VI:3 of the GATT 1994 and Article 10 of the SCM Agreement can
be considered consistent with the same provisions. As a result , and as also evidenced in the Final
Determination, the United States did not implement the "as applied" findings in the panel report
regarding Section 771B either and the United States has failed to implement the DSB's
recommendations and rulings.

In light of the foregoing, it appears that, through its actions and omissions, the United States has
failed to comply with the recommendations and rulings adopted by the DSB in relation to the
inconsistency as such and as applied with Article VI:3 of the G ATT 1994 and Article 10 of the
SCM Agreement of Section 771B in the panel proceedings.
The measures taken by the United States adversely affect exports to the United States of ripe olives
from Spain, and also nullify or impact the benefits accruing to the EU and its Member States directly
or indirectly under the cited agreements.
This consultation request relates to the measures at issue and to any amendments, supplements,
extensions, replacement measures, renewal measures and implementing measures, inclu ding but
not limited to any such measures referred to by either party during the consultations.
The EU reserves the right to address additional measures and claims under other provisions of the
covered agreements regarding the above matters during the course of the consultations.
The EU looks forward to receiving the United States' reply to this request and to finding a mutually
convenient date and place for the consultations in line with the principles included in the Sequencing
Agreement.

Countervailing Duty Order, 83 FR 37469, 1 August 2018; and Ripe Olives from Spain: Antidumping Duty Order,
83 FR 37467, 1 August 2018. Ripe Olives from Spain: Final Affirmative Countervailing Duty Determination, C-
469-818, DOC, 11 June 2018, published in 83 FR 28186, 18 June 2018; and Ripe Olives from Spain: Final
Affirmative Determination of Sales at Less Than Fair Value, A-469-817, DOC, 11 June 2018, published in 83 FR
28193, 18 June 2018. Ripe Olives from Spain, Investigation Nos 701-TA-582 and 731-TA-1377 (Final), US ITC,
July 2018.