Document: WT/DS268/RW Page E-1 ANNEX E QUESTIONS AND ANSWERS Contents Page Annex E-1 Answers of Argentina to Questions of the Panel E-2 Annex E-2 Answers of the United States to Questions of the Panel E-55 Annex E-3 Comments of Argentina on the United States' Written Answers to Questions from the Panel to the Parties E-83
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 E

QUESTIONS AND ANSWERS

Contents Page
Annex E-1 Answers of Argentina to Questions of the Panel E-2
Annex E-2 Answers of the United States to Questions of the Panel E-55
Annex E-3 Comments of Argentina on the United States' Written Answers to
 Questions from the Panel to the Parties E-83
Annex E-4 Comments of the United States on Argentina's Answers to the
 Questions from the Panel to the Parties E-111
Annex E-5 Answers of the United States to Argentina's Written Questions E-128
Annex E-6 Comments of Argentina on the United States' Responses to the
 Written Questions from Argentina E-136
Annex E-7 Additional Comments of the United States on Argentina's Answers
 to Questions 20, 21 and 22 from the Panel to the Parties E-140
Annex E-8 Additional Comments of Argentina on the United States'
 Responses to the Panel's Questions to the Parties E-142

ANNEX E-1

ANSWERS OF ARGENTINA TO
QUESTIONS OF THE PANEL

WAIVER PROVISIONS

BOTH PARTIES

Q1. The Panel notes that Argentina argues, and the United States does not contest, that the
US law requires the USDOC to make its ultimate sun set determinations on an order-wide basis.
Please explain whether this is the case and, if so, cite the relevant provisions of the US law
(including regulations and/or policy provisions) which require the US investigating authorities
to make their sunset determinations on an order-wide basis and provide copies thereof.

Argentina's Response to Question 1

1. The Appellate Body has clarified in a previ ous dispute that the United States could render a
sunset determination on an "order-wide" basis and that the mere fact of doing so would not be
inconsistent with US obligations under Artic les 6.10 or 11.3 of the Anti-Dumping Agreement. 1
However, the "as such" violation of the US st atutory and regulatory waiver provisions exist
independently of, and irrespective of, whether US la w requires that US sunset review determinations
be made on an "order-wide" (or "country-wide") basi s or not. The violation comes from the fact that
the waiver provisions continue to provide for a statutorily-mandated finding of likelihood for any
company that becomes subject to th e statutory waiver provision, either where there is an "affirmative
waiver" (as contemplated by the modified regulation) or where a party "elects not to participate" (as
provided for in Section 751(c)(4)(A) of the Tariff Act), but also does not file an affirmative statement
of waiver and a statement that it would be likely to dump.

2. The Appellate Body found that Section 751( c)(4)(B) and its implementing regulation were
inconsistent, as such, with US obligations under Article 11.3 of the Anti-Dumping Agreement:

Because the waiver provisions require the USDOC to arrive at affirmative company-
specific determinations without rega rd to any evidence on record, these
determinations are merely assumptions made by the agency, rather than findings
supported by evidence…. [E]ven assuming that the USDOC takes into account the
totality of record evidence in making its order-wide determination, it is clear that, as a
result of the operation of the waiver provisions, certain order-wide likelihood
determinations made by the USDOC will be based, at least in part, on statutorily-
mandated assumptions about a company's likelihood of dumping. In our view, this
result is inconsistent with the obliga tion of an investigating authority under
Article 11.3 to "arrive at a reasoned conclusion" on the basis of "positive evidence".
Therefore, we uphold the Panel's findings...that Section 751(c)(4)(B) of the Tariff Act
of 1930 and Section 351.218(d)(2)(iii) of the USDOC Regulations are inconsistent, as
such, with Article 11.3 of the Anti-Dumping Agreement.
 2

1 Appellate Body Report, US – Corrosion Resistant Steel Sunset Reviews , DS244, paras. 162
and 212(c)(i).
2 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews, paras. 234-235.

3. Thus, the problem identified by the Appella te Body has not been remedied. In a USDOC
sunset review, it is the mere appli cation of Section 751(c)(4)(B), which mandates a certain outcome –
and divests the USDOC of discretion as to what result to reach – at least as to any company that is
subject to the statutory waiver provision, that gives ri se to the violation of Article 11.3. In this way,
the mere application of the statutory waiver pr ovision, Section 751(c)(4)(B), in a USDOC sunset
review will always taint an order-wide determinati on, irrespective of the number of companies that
are subject to the waiver provision or that are involved in the review.

4. As the Appellate Body found, "certain order-wide likelihood determinations made by the
USDOC will be based, at least in part, on statutorily-mandated assumptions about a company's
likelihood of dumping. In our view, this result is in consistent with the obligat ion of an investigating
authority under Article 11.3 to 'arrive at a reasoned conclusion' on the basis of 'positive evidence'."

ARGENTINA

Q2. The Panel notes Argentina's assertion, in paragraph 156 of its Second Written
Submission, that the current US law directs the USDOC to find likelihood for companies that
"elect not to participate in USDOC's sunset review, but also does not file an affirmative
statement of waiver and an admission that it is likely to dump". The Panel also notes
Argentina's statement in paragraph 83 of its oral submission that the Tariff Act directs the
USDOC to find likelihood for exporters that do not participate and that do not file a statement
of waiver either. Finally, the Panel notes the US ' statement in paragraphs 5 and 8 of its oral
submission that "deemed waivers" have now di sappeared following the deletion of Section
351.218(d)(2)(iii) of the Regulations.

(a) Is Argentina challenging the US implementation of recommendations and rulings
relating to "deemed waivers"? Should the Panel understand Argentina's assertion to be
that the so-called "deemed waiver" provisions of the US law have not been repealed, or
properly amended, by the United States in the context of implementing the DSB's
recommendations and rulings in this case? Please elaborate.

Argentina's Answers to Question 2(a)

5. Argentina would initially reiterate that the Panel should determine how the US regulatory and
statutory waiver provision will operate in order to determine whether the United States has complied
with its obligations.3 Argentina's position is that the United St ates has failed to implement the rulings
and recommendations of the DSB. Argentina's arguments demonstrate that both the statutory and
regulatory waiver provisions remain inconsistent with US obligations under Article 11.3.

6. While the United States eliminated section 351.218(d)(2)(iii) of USDOC's regulation, and
while now there is no specific USDOC regulation providing for so-called "deemed waivers," the
violation has not been remedied because the United States has failed to amend or modify
Section 751(c)(4) of the Tariff Act.

7. Pursuant to the express terms of Section 751( c)(4)(A) of the Tariff Act, a respondent party
"may elect not to participate in a review conducted by [USDOC]". Accordingly, where a party does
not participate in a sunset review (even in cases in which it does not provide an "affirmative"
statement of waiver and "admission" that it will likely dump in the future), such a circumstance would
constitute a case where that party has "elect[ed] no t to participate" in a USDOC sunset review –
pursuant to the express language of the statute in Section 751(c)(4)(A).

3 Panel Report, United States – Anti-Dumping Act of 1916, Complaint by the European Communities ,
WT/DS136/R and Corr.1, adopted 26 September 2000, as upheld by Appellate Body Report, WT/DS136/AB/R,
WT/DS162/AB/R, DSR 2000:X, 4593, para. 6.51.

8. In these circumstances, the United St ates argues that USDOC would not invoke
Section 751(c)(4)(B), the statutory wavier provision. In support of its view, the United States argues
that it eliminated so-called "deemed waivers".
4 The implementing Federal Register notice explains
that "the Department will no longer make company-sp ecific findings for companies that fail to file a
statement of waiver and fail to file a subs tantive response to the notice of initiation". 5 T h e
implementing notice further indicates that "Section 751(c)(4)(B) of the Act only mandates an
affirmative company-specific likelihood finding as a consequence of a party electing to waive its
participation in the sunset review."
6 Comparing the modified regulation to the express wording of the
statute, however, shows that this is not correct.

9. Notwithstanding USDOC's stated intention as to how it would implement the revised
regulation, the express terms of the statute demonstrate that USDOC's interpretation of
Section 751(c)(4)(A) is inconsistent with its plain language. The statute mandates a company-specific
likelihood determination for any company that " elect[s] not to participate " in a USDOC sunset
review. Subsection (A) of Section 741(c)(4) of the Tariff Act establishes an option that is available
for USDOC sunset reviews (i.e., that a party may "el ect not to participate"). This subsection also
establishes who can make such an electi on (i.e., respondent interested parties).
7 Subsection (B)
explains the "effect" or consequence of a waiver (i.e., non-participation) by a respondent interested
party. The consequence is a statutorily-mandated finding of likely dumping for that company. The
terms of the statute thus direct a company-specific finding of likelihood for any respondent interested
party that elects not to participate in the USDOC sunset review.

10. Consequently, in the circumstance where a respondent party does not participate in a sunset
review, but also does not provide an "affirmative" statement of waiver, the terms of Section 751(c)(4)
mandate that USDOC make a finding that dumping woul d be likely for that party. The fact that
Section 751(c)(4)(A) refers to an "elect[ion] not to participate" and does not use the same phrase as in
Section 751(c)(4)(B) ("a review in which an inter ested party waives its participation"), does not
change the analysis. The title of the Section 751(c)(4) is "Waiver of participation by certain interested
parties". Subsections (A) and (B) are both integral to the operation of Section 751(c)(4) and these
subsections must be read together in determin ing how Section 751(c)(4) operates. Subsection (A)
must be read so as to have some meaning.
8

11. As Argentina has argued, under US law, a US statute will prevail over a US regulation where
the two measures are inconsistent. 9 In addition, although an agency such as the USDOC may
promulgate regulations pu rsuant to authority granted by Congress, that agency cannot through the
promulgation of a regulation confer on itself any gr eater authority than that conferred under the
governing statute.10 Accordingly, where the statute mandates a specific action (making an affirmative
likelihood determination), the statute cannot be overridden by USDOC's modification of the
corresponding regulation.

12. Consequently, notwithstandi ng an expression of how USDOC would implement the waiver
provisions or regulatory text to the contrary, the operation of the statute nonetheless continues to
operate in a manner inconsistent with US WTO obl igations. Section 751(c)(4)(B) directs a company-
specific finding of likelihood for any respondent interested party that elects not to participate in the

4 US First Submission, para. 14.
5 Procedures for Conducting Five-Year ("Sunset") Reviews for Antidumping and Countervailing Duty
Orders: Final Rule, 70 Fed. Reg. 62,061, 62,062 (28 Oct. 2005) (ARG-12).
6 70 Fed. Reg. at 62,063 (ARG-12).
7 This is the meaning of the phrase to "An interested party described in section 1677(9)(A) or (B)."
8 See Argentina's Second Submission, para. 163 and note 160.
9 See Argentina's Second Submission, para. 164 and note 161.
10 See Argentina's Second Submission, para. 164 and note 162.

USDOC sunset review, and is therefore incons istent with Article 11.3 of the Anti-Dumping
Agreement.

13. In addition, there continues to be a violation of Article 11.3 even in the case of an "explicit
waiver" (which includes the exporter's admission that it would be likely to dump upon revocation), the
statutorily-mandated finding for the exporter continues to violate the Agreement. The statute permits
no weighing of other evidence: once the waiver provision of the statute (Section 751(c)(4)(B)) is
triggered, the USDOC "shall" make an affirmative determination with respect to that exporter.
Because the obligation to arrive at a "reasoned conclusion" will always
 require the authority to
consider all of the evidence, and because any ev idence inconsistent with the exporter's admission
would be disregarded under the statute, the waiver provision remains inconsistent with Article 11.3.

(b) If not, would it be an accurate characteri zation of Argentina's claim to stipulate that
Argentina is only taking issue with the so-c alled "explicit waiver" provisions of the US
law in these Article 21.5 DSU proceedings? If so, would Argentina agree that the
current US law does not contain any provision that deems exporters to have waived
their right to participate in sunset reviews for failure to provide a full substantive
response to the USDOC's questionnaire or for any other reason? Please elaborate.

Argentina's Answers to Question 2(b)

14. Argentina's claim is that the United States fail ed to bring the statutory and regulatory waiver
provisions into conformity with the rulings a nd recommendations of the DSB, and with US WTO
obligations. As Argentina has argued, the violat ion comes from the application of the statutory
waiver provision, Section 751(c)(4)(B), in a sunset review. Argentina has argued that this provision is
triggered whenever a party "elect[s] not to particip ate" in a USDOC sunset review, as provided for in
Section 751(c)(4)(A). This "election," as contemplated by the statute, can happen in at least two
ways.

15. First, a party may "elect not to participate" by filing an affirmative waiver and making a
statement that it would be likely to dump. Th is is the route envisioned by the USDOC and as
provided for in its revised waiver regulation. Arge ntina's position is that application of the waiver
statute, Section 751(c)(4)(B), even in this inst ance, is a violation of Article 11.3 because once the
statute is triggered, the USDOC loses all discretion as to that company. The Department is required to
base its likelihood determination, at least in part (for a company is subject to the waiver provision),
pursuant to statutory mandate rather than pursuan t to a reasoned-decision making process as to what
would be likely for that company. This st atutorily-mandated finding renders the order-wide
determination inconsistent with Article 11.3.

16. Second, a party may "elect not to participate" and it may not file an affirmative statement or a
statement that it would be likely to dump. The United States argues that USDOC would not invoke
Section 751(c)(4)(B), the statutory wavier provision because it has eliminated the so-called "deemed
waiver" regulation.
11 However, as Argentina has argued, the US interpretation of
Section 751(c)(4)(A) is inconsistent with the plain language of the statute. The statute mandates a
company-specific likelihood determination for any company that " elect[s] not to participate " in a
USDOC sunset review. Subsection (A) of Section 741(c)(4) of the Tariff Act establishes an option
that is available for USDOC sunset reviews (i.e., that a party may "elect not to participate"). This
subsection also establishes who can make such an election (i.e., respondent interested parties). 12
Subsection (B) explains the "effect" or conseque nce of a waiver (i.e., non-participation) by a
respondent interested party. The consequence is a statutorily-mandated finding of likely dumping for
that company. The terms of the statute thus dir ect a company-specific finding of likelihood for any

11 US First Submission, para. 14.
12 This is the meaning of the phrase to "An interested party described in section 1677(9)(A) or (B)."

respondent interested party that elects not to partic ipate in the USDOC sunset review. Again, this
statutorily-mandated finding renders the order-wide determination inconsistent with Article 11.3.

17. Consequently, because Secti on 751(c)(4)(B) directs a company-specific finding of likelihood
for any respondent interested party that "elect[s] not to participate" in the USDOC sunset review
(whether by virtue of an affirmative statement of waiver or simply by takings no action in the review),
the waiver provisions remain inconsistent with Article 11.3 of the Anti-Dumping Agreement.

UNITED STATES

Q3. The Panel notes that Section 751 (c)(4)(B) of the Tariff Act of 1930 requires the USDOC
to find likelihood with respect to companies whic h waive their right to participate. The Panel
also notes that Section 218(d)(2)(ii) of the Regula tions stipulate that "every statement of waiver
must include a statement indicating that the resp ondent interested party waives participation in
the sunset review before the Department; a statement that the respondent interested party is
likely to dump".

 Please explain, in light of the above-refer enced provisions of the US law and its other
provisions that may also be relevant, what the US law stipulates with respect to respondents
that do not respond at all to the USDOC's que stionnaire and those that provide incomplete
responses. Specifically, please explain whether and how the US law also directs the USDOC to
find likelihood for these exporters.

Q4.

(a) Please explain generally the relevance of the company-specific finding of likelihood
under Section 751 (c)(4)(B) to the USDOC's order-wide determination.

(b) Given the mandate of Section 751 (c)(4)(B) of the Tariff Act to find likelihood for
companies that waive participation, would it be accurate to say that the USDOC has to
find likelihood in its ultimate order-wide determination in every sunset review where the
USDOC finds likelihood for individual companies that waive participation?

Q5. Please explain whether there has been any sunset review where the USDOC found
likelihood for individual exporters by virtue of Section 751 (c)(4)(B) of the Tariff Act and found
no likelihood on an order-wide basis. If so, please provide a copy of the USDOC's final
determination in such reviews.

Q6. The Panel notes that Section 751(c)(4) of the Tariff Act of 1930 provides, in relevant
part:

 (4) Waiver of participation by certain interested parties

 (A) In general

 An interested party described in sectio n 1677(9)(A) or (B) of this title may elect
not to participate in a review conducted by the administering authority under this
subsection and to participate only in the review conducted by the Commission
under this subsection.

 (B) Effect of waiver

 In a review in which an interested party waives
 its participation pursuant to this
paragraph, the administering authority shall conclude that revocation of the order

or termination of the investigation would be likely to lead to continuation or
recurrence of dumping or a countervailable subsidy (as the case may be) with
respect to that interested party.13 (emphasis added)

(a) Please explain whether electing not to participate within the meaning of
subparagraph (A) constitutes a waiver within the meaning of subparagraph B.

(b) How does an exporter elect not to particip ate within the meaning of subparagraph A?
Does remaining silent, i.e. not submitting any response to the USDOC's questionnaire,
constitute an election not to participate with in the meaning of subparagraph (A)? If so,
does this constitute a waiver for the purposes of subparagraph B?

BOTH PARTIES

Q7. Under what circumstances would a signed waiver statement constitute a sufficient
evidentiary basis for an affirmative likelihood determination? Would your response depend on
the circumstances of a given sunset review? For example, would your response differ in relation
to: (i) a review in which the only exporter subm its a signed waiver statement; (ii) a review in
which, of the 20 exporters involved, 10 submit a signed waiver statement and 10 participate
cooperatively; (iii) a review in which, of the 20 exporters involved, 1 submits a signed waiver
statement and 19 remain silent? How would the company-specific conclusions of likelihood
with respect to exporters that waive their right to participate (by signing a statement of waiver)
in these scenarios be reflected in an ultimate order-wide determination?

Argentina's Answer to Question 7

18. Argentina would initially observe that the Panel's question itself highlights the problem
attendant with the loss of US discretion – by opera tion of the statutory mandate to make – to assess
the probative value of evidence – whether an "admi ssion" of likely dumping or the inference to draw
from a company that elects not to participate but also does not file an affirmative statement of waiver.

19. The fact is, depending upon the particular f acts of a given case, a signed waiver statement
may or may not be probative for a particular co mpany, and its probative value on the overall order-
wide determination can vary. Yet, in any case in which the statutory waiver provision applies, the
USDOC must – pursuant to the mandate of the statute – find that dumping would be likely to continue
or recur for that company. Again, the terms of the statute mandate
 a likely dumping finding for a
company either where there is an "affirmative waiver" by that company (as contemplated by
USDOC's modified waiver regulation), or where a company "elects not to participate," as provided for
in 751(c)(4)(A), but also does not file an affirmative statement of waiver.

20. Thus, the problem in all of the scenarios outlined by the Panel' s question, is that the USDOC
must find that dumping would be likely for a company once the statutory waiver provision is
triggered. At that point, the USDOC has zero discretion
 for that particular company to reach any
result other than a affirmative determination for that company. As the Appellate Body stated, it is the
substitution of a statutorily-mandated finding for reasoned analysis and decision making by the
authority that would taint the order-wide determination in such a case.14

Q8. The Panel notes that Section 751(c)(4) of the Tariff Act does not define the term
"waiver". The Panel also notes that Section 3 51.218(2)(ii) of the Regulations states that a
statement of waiver "must include a statement i ndicating that the respondent is likely to
dump."

13 Exhibit ARG-33 at 1152.
14 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews, paras. 234-235.

 Can this, in your view, be interpreted to me an that the Regulations nullify, or limit the
scope of, the Statute in so far as the Statute refers to waiver.

Argentina's Answer to Question 8

21. Under US law, the USDOC cannot issue a regulati on that is inconsistent with a US statute.
Nor is it permissible under US law for the USDOC to issue a regulation that attempts to limit the
scope of application of a US statute.

22. The terms of Section 751(c)(4)(B) require the USDOC to make a company-specific
likelihood determination for any company that "may elect not to participate" in a USDOC sunset
review. As Argentina has argued, under US law, a US statute will prevail over a US regulation where
the two measures are inconsistent.
15 In addition, although an agency such as the USDOC may
promulgate regulations pursuant to authority gr anted by Congress, that agency cannot through
promulgation of a regulation modify or repeal a statute.16

23. Thus, under US law, USDOC cannot evade th e statutory requirement (which mandates a
company-specific likelihood determination for any company that elects not to participate in a USDOC
sunset review), by modifying the implementing regulation in a manner that reduces the reach 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).

24. Finally, and in order to be very clear, Arge ntina reiterates that the violation comes from the
operation of Section 751(c)(4)(B) in a USDOC sunset review. When that provision is triggered –
either where there is an "affirmative waiver" by that company (as contemplated by USDOC's
modified waiver regulation) or where a company "elects not to participate" (as provided for in
751(c)(4)(A)) (irrespective of whether it files an a ffirmative statement of waiver) – the terms of
Section 751(c)(4)(B) mandate
 a likely dumping finding for a company. A statutorily-mandated
finding (which divests the authority of all discret ion), even if for only one company and even if
triggered by a purported admission, is inconsiste nt with Article 11.3 because of the authority's
obligation in an Article 11.3 review to arrive at a "reasoned conclusion" based on a consideration and
weighing of all the evidence.17

FACTUAL BASIS OF THE USDOC's SECTION 129 DETERMINATION

ARGENTINA

Q9. The Panel notes Argentina's arguments re garding the new factual basis developed by
the USDOC in its Section 129 Determination. Is it Argentina's view that Article 11.3 of the
Anti-dumping Agreement ("Agreement") precludes an investigating authority from developing
new facts in order to comply with the DS B recommendations and rulings regarding the
inadequacy of the factual basis of its sunset de terminations? Please elaborate on the temporal
and substantive considerations involved in gath ering "new facts" in light of the notion of
implementation of the DSB recommendation s and rulings embodied, among others, in
Articles 19, 21, and 22 of the Dispute Settlement Understanding ("DSU"). How should an
investigating authority accommodate the "p rospective nature" of sunset reviews under
Article 11.3 in the process of gathering "new facts" in the course of implementation?

15 See Argentina's Second Submission, para. 164 and note 161.
16 See Argentina's Second Submission, para. 164 and note 162.
17 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews, paras. 234-235.

Argentina's Answer to Question 9

25. Articles 11.3 and 11.4 of the Anti-Dumping Agre ement preclude an investigating authority, in
a domestic proceeding seeking to comply with the rulings and recommendations of the DSB arising
out of an finding that it violated Article 11.3 of the Anti-Dumping Agreement, from developing a new
factual basis to support its Article 11.3 determina tion, where the evidence required to support its
original Article 11.3 determination was not developed at the time of the original Article 11.3 review.
The investigating authority is obliged to initiate the requisite "review" and gather the necessary
positive evidence in order to make the requisite "determination" required by Article 11.3 of the
Anti-Dumping Agreement prior to
 the expiry of five years following the imposition of the
antidumping measure. For example, assume that an authority continues the measure beyond five
years, but does nothing more than initiate an Article 11.3 review in a timely manner. In that review,
the authority develops no
 evidence at all. In su ch a case, the obligations of Articles 11.3 and 11.4 to
conduct a "review" and make a "determination" pr ior to continuing the measure cannot be satisfied
by the Member – it has missed its opportunity to make a "determination" in the review initiated at that
time.

26. The "review" and "determination" under Article 11.3 in this regard must have had several
characteristics. The determination needed to be a "prospective determination," requiring a "forward-
looking analysis".
18 USDOC needed to take an "active" rather than a "passive" role in developing and
assessing the information.19 The USDOC was required to "act with an appropriate degree of diligence
and arrive at a reasoned conclusion on the basis of information gathered as part of a process of
reconsideration and examination". 20 The requirement to make a "determination" concerning
likelihood precluded USDOC from simply assuming that likelihood exists. 21 Finally, USDOC was
required to assess the information before it objectively and to have a sufficient factual basis to allow it
to draw reasoned and adequate conclusions concerning such likelihood.22

27. Because the anti-dumping duty order on OCTG from Argentina was imposed in August 1995,
the United States had an obligation to terminate th e measure before August 2000 unless it adhered to
the requirements for invoking the exception (continuation of the measure), as set forth in Articles 11.3
and 11.4. Thus, in order to invoke the excep tion and to extend the measure beyond August 2000, the
US authorities were required to initiate a "review" before "that date", (i .e., August 2000) and to
"determine" that "expiry of the duty would be lik ely to lead to continuation or recurrence of
dumping".

28. This is fully consistent with the Appellate Body's clarification of the Article 11.3 obligation.
In US – Corrosion-Resistant Steel Sunset Review, the Appellate Body provided authoritative guidance
on the obligations imposed on Members during a sunset review by Article 11.3. It began by noting
that:

Article 11.3 imposes a temporal limita tion on the maintenance of anti-dumping
duties. It lays down a mandatory rule with an exception. Specifically, Members are
required to terminate an anti-dumping duty within five years of its imposition
"unless" the following conditions are satisfied: firs t, that a review be initiated before
the expiry of five years from the date of the imposition of the duty; second, that in the

18 Appellate Body Report, United States – Sunset Review of Anti-Dumping Duties on Corrosion-
Resistant Carbon Steel Flat Products from Japan , WT/DS244/AB/R, adopted 9 January 1994, paras. 104-105
(original emphasis) ("US – Corrosion-Resistant Steel Sunset Review")
19 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 111.
20 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 111.
21 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, paras. 104-105, 111.
22 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, paras. 104-105, 111.

review the authorities determine that the expiry of the duty would be likely to lead to
continuation or recurrence of dumping; and third, that in the review the authorities
determine that the expiry of the duty woul d be likely to lead to continuation or
recurrence of injury. If any one of these conditions is not satisfied, the duty must be
terminated.
23
29. Article 11.4 of the Anti-Dumping Agreemen t provides that the review conducted under
Article 11.3 "shall be carried out e xpeditiously and shall normally be concluded within 12 months of
the date of initiation of the review". In clarifying Article 11.4 of the Agreement, the Appellate Body
expressly recognized that the "duty" may "continue while the review is underway" constitutes an
"additional exception" – and in effect, the sole exception – to the requirement that anti-dumping duties
will be terminated after five years, in the absence of compliance with the requirements of Article 11.3:

Article 11.3 states that, notwithstanding the provisions of Articles 11.1 and 11.2,
Members "shall" terminate an anti-dumping duty "unless" the authorities make an
affirmative likelihood determination in a s unset review. This confirms that the
mandatory rule in Article 11.3 applies in addition to, and irrespective of, the
obligations set out in the first two paragraphs of Article 11. This also suggests to us
that authorities must conduct a rigorous examination in a sunset review before the
exception (namely, the continuation of the duty) can apply. In addition, our view of
the exacting nature of the obligations im posed on authorities under Article 11.3 is
supported by a consideration of the implica tions of initiating a sunset review. The
last sentence of Article 11.3 allows the rele vant duty to continue while the review is
underway, and Article 11.4 contemplates that the review process may take up to one
year. These provisions create an additiona l exception to the requirement that anti-
dumping duties will be terminated after five years, permitting a Member to maintain
the duty for the period during which the revi ew is ongoing, regardless of the outcome
of that review. This, too, suggests that the drafters of the Anti-Dumping Agreement
saw the sunset review as a rigorous process th at can take up to one year, involving a
number of procedural steps, and requiring an appropriate degree of diligence on the
part of the national authorities.
24
30. The Appellate Body's reaffirmation of the te mporal obligations in Article 11.3 identified in
the preceding paragraphs is not inconsistent with the Appellate Body's pronouncements in OCTG
from Mexico , where the Appellate Body stated that a WTO-inconsistent determination under
Article 11.3 would not necessarily lead to termination immediately:

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-consis tent 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 reas onable period of time accorded to the
implementing Member for implementation.
25

23 Appellate Body Report, United States – Sunset Review of Anti-Dumping Duties on Corrosion-
Resistant Carbon Steel Flat Products from Japan , WT/DS244/AB/R, adopted 9 January 1994, paras. 104-105
(original emphasis) ("US – Corrosion-Resistant Steel Sunset Review").
24 Appellate Body Report, US - Corrosion-Resistant Steel Sunset Review, para. 113.
25 Appellate Body Report, US – OCTG from Mexico, para. 187 (emphasis added).

31. The Appellate Body referred to the "fact" that Article 11.3 sets a temporal limit for
termination of an anti-dumping duty, in the abse nce of a review leading to a WTO-consistent
determination under that Article fo r its continuation. The Appellate Body explicitly recognized, once
again, the temporal requirements of Article 11.3.

32. Regarding the provisions of the DSU, as the A ppellate Body also recognized, its clarifications
of the obligation of Article 11.3 did not affect the other provisions of the DSU governing the
implementation of the recommendations and rulings of the DSB, including the provisions identified in
the Panel's question – Articles 19, 21, and 22. At the same time, it must be emphasised that a
Member's substantive obligations under the covere d agreements do not change merely because that
Member is involved in a WTO dispute, and certain rights and obligations of the DSU are implicated
by virtue of the WTO dispute settlement process. These DSU rights include, most notably, the right
of the implementing Member to an RPT, and the right of the Member to chose the means of
implementation.

33. Article 19 of the DSU provides:

1. Where a panel or the Appellate Body c oncludes that a measure is inconsistent
with a covered agreement, it shall recomme nd that the Member concerned bring the
measure into conformity with the agreemen t. In addition to its recommendations, the
Panel or the Appellate Body may suggest ways in which the Member concerned
could implement the recommendations.
2. In accordance with paragraph 2 of Article 3, in their findings and
recommendations, the Panel and the Appellate Body cannot add to or diminish the
rights and obligations provided in the covered agreements.
34. The Article 19.2 admonition that "[i]n accordan ce with paragraph 2 of Article 3, in their
findings and recommendations, the Panel and Appellate Body cannot add to or diminish the rights and
obligations provided in the covered agreements" is important in this case. Any rulings by this Panel
in this compliance proceeding that would give th e United States, now in 2006, the opportunity to
conduct yet another Section 129 proceeding in order to comply with the obligations that first attached
in 2000, and which the United States once again failed to discharge in 2005, would violate both
aspects of DSU Article 19.2.

35. First, any such ruling would serve only to fu rther erode Argentina's already impaired rights
under Article 11.3 to termination of the measure after five years in the absence of compliance with the
requirements of Articles 11.3 and 11.4. Second, fi nding that Article 11.3 permits the United States
with an opportunity to establish the requisite factual basis during the RPT in order to support the
WTO-inconsistent determination from 2000 would constitute an addition to the limited US right under
Article 11.3 to invoke the provision's exception to the prin cipal obligation to terminate the measure
(and thereby continue anti-dumping duties on OCTG from Argentina) only if it had first complied
with the substantive obligations of Articles 11.3 and 11.4 of the Anti-Dumping Agreement.

36. The provisions of Article 21 of the DSU are not inconsistent with Argentina's view of the
substantive and temporal obliga tions of Article 11.3 and 11.4 of the Anti-Dumping Agreement.
Article 21.1 states that "prompt compliance with r ecommendations or rulings of the DSB is essential
in order to ensure effective resolution of disputes to the benefit of all Members". This provision is
fully consistent with Argentina's position, as "prompt compliance" in this case is "essential" in order
to ensure that Argentina's rights under Article 11.3 are not wholly diminished in light of the US
further to demonstrate at the end of the RPT that it satisfied the requirements for invoking the limited
exception in Article 11.3.

37. Further, DSU Article 21.3 provides, inter a lia, that "[i]f it is impracticable to comply
immediately with the recommendations and rulings [o f the DSB], the Member concerned shall have a
reasonable period of time in which to do so". This provision recognizes that it is the right of the
Member to determine how best to bring itself in to conformity. At the same time, however, as
Argentina has argued during this proceeding, the manner in which USDOC conducted the 2000
review necessarily affects what the United Stat es could do during the RPT to bring itself into
compliance with its obligations in 2005. Argentin a has observed that if USDOC had been active, had
properly established a sufficient evidentiary basis, bu t had failed to explain adequately its decision, it
might have been able to bring itself into complianc e with its obligations in 2005 by clarifying that
information, or further explaining its reasoning. In such a case, the authority would have satisfied its
obligation to be active rather than passive, and its obligation to develop a sufficient evidentiary basis
in the review that preceded the continuation of the measure. In other words, the subsequent act of
clarifying the evidence or the reasoning that formed the basis of the determination might not affect the
substance of the authority's obligation.

38. Put simply, during the RPT, United States w as permitted to clarify, based on the evidence
established in the original sunset review, why its 2000 sunset determination is consistent with US
obligations under Article 11.3. It was required to do this, however, within the RPT.

39. Argentina would again reiterate that paragraph 187 of the decision of the Appellate Body in
US – OCTG from Mexico is not inconsistent with Argentina' s interpretation of the obligations of
Article 11.3, and can be fully reconciled with the rights a Member has under the DSU.

40. The Appellate Body stated that:

The fact that the USDOC acted inconsistently with the requirements of Article 11.3 in
its likelihood-of-dumping determina tion does not necessarily imply that the
underlying anti-dumping duties must be terminat ed 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-consis tent 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 reas onable period of time accorded to the
implementing Member for implementation
26
41. In the present case, however, the United States has already exercised certain of its right under
the DSU. It has exercised its right to an RPT, and it has 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 United States already has exercised its rights under the DSU. Therefore, if this Panel
finds that the United States is not in compliance, the consequences are – and should be – that the
United States must terminate the measure – or risk being in perpetual non-compliance. There will be
no new RPT and there is no basis for it to conduct another Article 11.3 determination. In fact, the
United States itself recognized this very point:

It would be unfair for the United States, which was under no obligation to take an
action with respect to the volume analysis, to find out for the first time in an
Article 21.5 proceeding that the Panel cons iders that analysis deficient. The
United States could then be faced with a request for authorization to suspend

26 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.

concessions, with no reasonable period of time to bring the measure into
compliance.
27
42. In these circumstances, th e obligation under Article 11.3 requires that the United States
immediately revoke the illegal order, in the absen ce of a WTO-consistent determination, is the
obligation with which the United States must comply.

43. Such a result would be in complete accord with Article 22 of the DSU, which recognizes that
"full implementation of a recommendation to brin g a measure into confor mity with the covered
agreements" is preferred to both compensation and suspension of concessions. Article 22 reinforces a
fundamental principle of WTO dispute settlement, which is enshrined in DSU Article 3.7, which
states that "the first objective of the dispute settleme nt mechanism is to secure the withdrawal of the
measures concerned if these are found to be inconsis tent with the provisions of any of the covered
agreements".

44. In the 2005 Section 129 proceeding, the USDOC developed a new factual basis to support the
WTO-inconsistent determination it made in 2000. The USDOC acted inconsistently with
Articles 11.3 and 11.4 of the Anti-Dumping Agreemen t by developing new factual information to
support its 2000 likelihood of dumping determination, where none of the evidence required to support
such a determination was devel oped in 2000, the time when USDOC was obliged to conduct the
requisite "review" and gather the necessary posit ive evidence in order to make the requisite
"determination" required by Articles 11.3 and 11.4 of the Anti-Dumping Agreement.

45. Finally, as to the last part of the question re garding the prospective nature of the Article 11.3
review, this further supports Ar gentina's view. The Article 11. 3 review must be prospective
, which
means that a decision must be made at a specific time as to what is likely to o ccur in the future. This
is directly contrary to how the USDOC proceeded in rendering its determina tion to bring itself into
compliance with its Article 11.3 obligations. Essentially, the USDOC undertook to conduct a
retrospective review of the period 1995-2000, wh ile selectively using information and knowledge it
gained subsequent to the sunset review, i.e., after 2000. Therefore, not only did the USDOC develop
a different evidentiary basis than had been established in the 2000 review, the USDOC also
selectively used information and knowledge it obtaine d after that sunset review, and which
information related to the period after 2000, to take positions and to dr aw inferences in the
Section 129 proceeding that were predisposed against the Argentine exporters.

46. If the authority does not develop a sufficient evid entiary basis in order to make its prospective
determination in the review initiated "at that time, " it will violate its Article 11.3 obligation, as the
United States has done here. If the Member then tr ies to achieve compliance by developing, for the
first time, a different evidentiary basis in order to justify its previous decision to continue the measure,
it is no longer making a prospective determination of what is likely to occur. Rather, it is, at best,
offering a new factual basis to justify a decision th at it made in the past on the basis of different
evidence. This is not consistent with the pr ospective nature of the Article 11.3 review and
determination.

USDOC's LIKELIHOOD DETERMINATION

UNITED STATES

Q10.

(a) The Panel notes that the USDOC asked the Argentine exporters to submit their
consolidated and unconsolidated financial statements for the 1996-2000 period, as well

27 US Second Submission, para. 31.

as to provide information relating to their costs and the volume of their shipments to the
United States in the period of review.
28

 Please explain for what purpose the USDOC so ught the mentioned information. More
specifically, please explain whether the USDOC in tended to, and the extent to which it did,
determine whether these exporters actually dumpe d in the period of review, and how this
relates to the obligations under Articles 11.3 and/or 2.1 of the Agreement. Please explain how
exactly the USDOC intended to, and the extent to which it did, base its determination regarding
the existence of dumping on the costs of the exporters, citing any record evidence supporting
your response.

(b) If the USDOC intended to determine whether the Argentine exports to the United States
were dumped during the period of review, please explain why the USDOC did not seek
information relating to these companies domestic sales prices and their export prices to
the United States. Please explain how the USDOC intended to, and the extent to which
it did, determine whether these compani es dumped in the past on the basis of
information that it sought from them, i.e. their costs and the volume of their shipments
to the United States, citing any record evidence supporting your response. Please explain
how this relates to the obligations under Articles 11.3 and/or 2.1 of the Agreement.

Q11.

(a) Please explain to what extent, if at all, an investigating authority is bound by the
definition of dumping found in Article 2.1 of the Agreement in a determination
regarding the existence of dumping in the period of review in a sunset review under
Article 11.3 of the Agreement. In other words, in your view, can an investigating
authority determine the existence of dumping without having regard to the normal
value and export price of the exporter(s) under review?

(b) In your view, is there a difference between calculating the margin of dumping for an
exporter and determining the existence of dumpi ng for that exporter? In other words,
can an investigating authority determine that an exporter dumped in a given period in
the past without calculating a margin of dumping or relying on a margin already
calculated in the past? If your response is in the affirmative, please explain whether
such a determination can be made without having regard to the two components of
dumping, i.e. normal value and export price, set out in Article 2.1 of the Agreement.

(c) On what basis could an investigating authority properly find affirmative likelihood of
continuation or recurrence of dumping other than with regard to the existence of
dumping?

 Please elaborate on the basis of the relevant provisions of the Agreement.

Q12. The Panel notes Argentina's claim regardi ng the comparison the USDOC made between
Acindar's export prices and the average transa ction price (by weighted average value) that
prevailed in the US market for the subject pr oduct. The Panel also notes that the USDOC
inferred from this comparison the conclusion th at Acindar was likely dumping in the period of
review.

(a) Please explain the legal basis under the Agreement for basing a determination of
dumping, be it likely or actual, on a comparison of an exporter's export price with the

28 USDOC's questionnaire (Exhibit ARG-13).

average transaction price (by weighted average value) that prevails in the country of
imports for the subject product.

BOTH PARTIES

(b) The Panel notes Argentina's assertion th at the USDOC ignored certain factors that
affected this comparison, such as differences in the physical characteristics of the
products compared, the levels of trade at which the comparison was made, as well as
differences relating to transportation costs.

Please explain in detail and by referring to the relevant parts of the record, whether any
of these factors were known to the USDOC in the Section 129 proceedings at issue and, if so,
whether this was taken into account.

Argentina's Answer to Question 12(b)

47. These factors were known to the USDOC in S ection 129 proceedings. The Panel can confirm
this by reviewing the following portions of the record:

• In its initial response to the Department 's questionnaire (the 30 November 2005
response appearing as ARG-15), Siderca explained the effect of physical
characteristics on the costs and prices of OCTG. On page 4, Siderca explained:
While Siderca has reported the cost data for product categories defined
by the Department, Siderca would like to stress that the data for such
broad product groupings is of limited value from a cost and
commercial point of view. As the Department knows, unit product
costs for carbon and alloy OCTG depends upon the precise physical
characteristics of each specific product (outside diameter, wall
thickness, length), the precise type of steel used, the precise type of
threading used, and other customer requirements (such as testing,
markings, coatings, etc.). To illustrate the point, Siderca includes in
Attachment 6 a listing of production capabilities at its production
facilities and the corresponding product characteristics. As the list
demonstrates, the number of possible combinations of specific product
characteristics is extremely large. This is true even within the ten
product categories defined by the De partment, as there are literally
thousands of possible product combinations within each of the ten
categories. The production cost and commercial values for the
different products differ, although no t always in the same proportion,
as some products can be sold at a higher profit than others.
• Attachment 6 referenced in the passage quot ed above contained a list of the physical
characteristics within Siderca's OCTG production range. ( See the final pages of
ARG-15.) The outside diameters range from 1.315 inches to 10¾ inches, and the
steel grades range from the most basic J and K grades to numerous highly specialized
alloy grades. In addition, a number of specific connections are identified in the
attachment, as well as different range lengths and special customer requirements that
can be requested.
• In Attachment 2 of Siderca's response (ARG-15), Tenaris' Regional CFO explained:
6. Even if we had the data or were able to reconstruct it, the
data would be of limited value because of the product (or product
category) definition. The questionnaire does not request product-

specific data. Rather, the Department has identified what can best be
described as large categories of products without any specification of
the essential dimensions that define tubular products for cost
purposes, such as outside diameter, wall thickness, range, and steel
grade.

7. Even if Siderca had the information, the information would
not be meaningful from a cost perspective. For example, the first
category defined in the questionnaire is defined as "carbon casing,
plain end." In the cost accounting system that Siderca maintains
today, there are many products that would have to be grouped into
this general category. The commercial values of the different
products would also vary, although not necessarily in the same
proportion as the cost. Therefore, an average cost of a product
category such as "carbon casing, plain end" is nearly meaningless
from a cost accounting point of view. The same is true of the other
nine product categories identified in the questionnaire.

• In Siderca's 7 December 2005 letter (ARG-19), Siderca addressed the issue again, this
time in response to a proposed comparison of Siderca's cost to Argentine export
statistics which identified the products at the HTS level. Siderca stated:

1. As Siderca pointed out in its 30 November 2005 response,
the ten product categories iden tified in the Department's
questionnaire are so broad that they make any conclusions drawn
from the data highly doubtful, and certainly not sufficient to support
the conclusion of whether "dumping" is likely to continue or recur.
As Siderca stated, ther e are literally thousands of possible different
products within each of the ten cate gories, with many different costs
and selling prices, depending on the unique combination of physical
characteristics and customer demands defining the product.

• Neither the parties nor the Department ever responded to Siderca's statements
regarding this issue. The next mention of the issue was in the Section 129
determination (ARG-16). On page 4, th e Department summarizes Siderca's argument
in its first paragraph under the heading, "Comments from Respondent Interested
Parties." In the "Analysis" section beginning on page 6, the Department does not
specifically address Siderca's comments. However, in the context of discussing the
alleged "inconsistencies" in Siderca's cost data, the Department states:
The categories which defined our product groupings in this
determination were, of necessity, broad. They do, however,
reflect three significant characteristics that serve to determine
price in the market (i.e., seaml ess v. welded, carbon v. alloy,
and casing v. tubing v. drill pipe). Furthermore, we made our
comparison of Acindar's sales, discussed above, based on
identical matches of these characteristics. Available
information does not enable us to make comparisons on a more
specific basis; nor are we obligated to perform a product-
specific dumping analysis de novo in reaching our likelihood
determination….

48. The Panel should take note of two important aspects of the development of this issue in the
Section 129 proceeding. First, the Department asser ts that its comparison of Acindar's sales to the
Preston Pipe data was "based on identical matches of these characteristics". 29 At this point in the
proceeding, it should be clear that this statement is factually incorrect. It is clear that the Preston Pipe
Report used as the basis for the comparison did not distinguish between plain end OCTG and OCTG
with other types of end finishing. In other word s, the Department compared specific types of OCTG
sold by Acindar, presumably identified at the HTS level 30, which distinguishes OCTG by end finish,
with Preston Pipe categories that mix together OCTG with different end finishes in each category. As
established at the hearing and in ARG-34, the differe nce in end finishing can be significant, at times
reaching $250 per ton.

49. Second, the comparison also is flawed becau se the USDOC apparently had no idea of the
product characteristics on either side of its comparis on. Within each Preston Pipe category there is an
unknown mix of products of different diameters, steel grades, wall-thicknesses, ranges, and end
finishes. Also, it appears that USDOC did not know – and made no attempt to learn – the physical
characteristics of the products exported by Acindar.

50. In conclusion, while these factors were know n to USDOC, USDOC did not take them into
account in the Section 129 determination. USDOC never attempted to develop information that
would control these parameters. Nor did the USDO C ever respond to the concerns Siderca expressed
about the potential comparisons. USDOC in fact never revealed what comparison it was performing
until it released its final determination.

51. Finally, it should also be noted that the USDOC did rely on the physical characteristics of the
products whenever doing so served to discredit the Ar gentine exporters' information. For example, to
support its theory that Siderca's cost informati on was "inconsistent," USDOC calculated a weighted
average cost for OCTG with different end finishes, explaining in its Second Submission to this Panel
that it did so "because the available public info rmation grouped the products in that manner".
31
Inexplicably, USDOC was concerned about the ph ysical characteristics of the products being
compared when evaluating Siderca's cost informati on, but not when performing the price comparison
for Acindar.

Q13. The Panel notes that the USDOC's Sect ion 129 Determination states that the USDOC
did not use the cost data in Acindar's financia l statements because those data related to a
product category that included products other th an the subject product. The USDOC stated
that "the inclusion of costs related to the me rchandise not subject to review would distort [the
USDOC's] analysis".
32 Yet the USDOC relied on these financial statements with respect to its
determination that the OCTG market was depressed in the period of review.33

(a) Please explain, by referring to the relevan t parts of the record, the relevance of the
financial statements of Siderca and Acinda r for both the company-specific and order-
wide phases of the USDOC's sunset dete rmination in these proceedings. More

29 ARG-16, page 4.
30 For the Panel's convenien ce, Argentina attaches as Annex 1 to this response a copy of the HTS in
force in 1998, 1999, and 2000, the years that Acindar indicated that it had shipped a minimal quantity of OCTG
to the United States during the sunset period. These were obtained from the USIT C's website. For example,
Argentina obtained the 2000 version of the HTS from the following URL:
http://www.usitc.gov/tata/hts/archive/0000/000C73.pdf. The document shows that the HTS does distinguish by
type of OCTG (casing v. tubing), form (welded v. seamless), and general category of steel grade (alloy v.
carbon, with no specification of the specific steel used), and end finish (p lain end v. threaded and coupled). No
other distinctions are made.
31 US Second Written Submission at 50.
32 Section 129 Determination (Exhibit ARG-16 at 7).
33 Section 129 Determination (Exhibit ARG-16 at 7).

specifically, please explain whether the USDOC used these statements in support of its
order-wide determination that dumping was likely to continue or recur should the order
be revoked and where such use is reflected on the record.

Argentina's Answer to Question 13(a)

52. Before reviewing each of USDOC's references to the financial statements in the Section 129
Determination and responding to the Panel's spec ific question, Argentina would like to make a
preliminary comment regarding the "order-wide" na ture of the Article 11.3 determination. Even
though the Appellate Body has acknowledged that the review contemplated by Article 11.3 can be
"order-wide," this does not mean that company-specific information is not relevant. Companies
export, countries do not. In order to determine what is "likely" to occur on an "order-wide" or
"country-wide" basis within the meaning of Article 11.3, the authority will have to develop a
sufficient factual basis regarding the likely actions of the specific compani es. The Appellate Body
has recognized this in its explanation of why the authority must always review the reasons for a
volume decline:

The cessation of imports in the second scenar io and the decline in import volumes in
the third scenario could well have been cau sed or reinforced by changes in the
competitive conditions of the market-place or strategies of exporters, rather than by
the imposition of the duty alone. Therefore, a case-specific analysis of the factors
behind a cessation of imports or a declin e in import volumes (when dumping is
eliminated) will be necessary to determin e that dumping will recur if the duty is
terminated.
34
The Appellate Body is clearly referencing company strategies, not general notions of order-wide
trends.
53. Argentina addresses below each of the referenc es to the company's financial statements in
USDOC's Section 129 determination below. In orde r to be responsive to the question, Argentina
reproduces each reference to financial statements in the Section 129 Determination in the left column,
and responds to the Panel's question in the right column.

References to Financial Statement
 Observations
"The Department did, however, have access to
Acindar's financial statements, which included
some summary cost data. . . . These data were
for category "tubes, pipes, and structural
products.". . . Although this category includes
the merchandise under review, it also includes
other merchandise which is not subject to the
review. We are unable to segregate subject from
non-subject merchandise. Hence, we find this
category to be too broad for calculating a
meaningful cost/price trend analysis for purpose
of this sunset review. The inclusion of costs
related to merchandise not subject to review
would distort our analysis."
35
This passage refers most directly to the company-
specific determination for Acindar. The USDOC
considered that the inclusion of non-OCTG
products rendered the data not useful. However,
USDOC then used data from Acindar's overall
financial statement, in which the effect of OCTG
is even less relevant.

The United States Second Submission contradicts
USDOC's statement that the data is not useful.
See paras. 43-47 of Argentina's Oral Statement.

In other words, the USDOC rejected the more
specific information which showed that the
division producing OCTG was profitable, and

34 Appellate Body Report, US - Corrosion-Resistant Steel Sunset Review, para. 177.
35 ARG-16 at 7.

References to Financial Statement Observations
instead relied on information showing the loss
that had been generated from the general
operations.
"Based upon the foregoing, and in the absence of
usable cost data from Acindar, we find that
Acindar likely was dumping subject OCTG
during the original sunset review period.
Moreover, these Acindar sales occurred at a time
when Acindar was showing losses on its financial
statement; the financial statements of other
significant OCTG products, such as Siderca,
Lone Star, Maverick, and North Star, also were
showing losses. . . . These losses are an
indication that the OCTG market was depressed.
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
indicates that Acindar likely was dumping
significantly into the US market."
36
The financial statement data for Acindar's overall
operations are used to corroborate USDOC's
conclusion that the company was likely dumping
during the sunset review period. Thus, this
reference is used to establish dumping in the past,
rather than likely dumping in the future at either
the company or order level.
"Moreover, as discussed below, Acindar's
marketing strategy suggests that it would
continue to sell in the United States after the end
of the original sunset review period."
37
USDOC uses a narrative statement in Acindar's
financial statement as evidence that Acindar is
likely to sell OCTG in the United States. No
mention is made of likely dumping.
"However, for both Siderca and Acindar, we have
financial statements from the original sunset
review period that provide information on the
financial statuses of these companies. This
information establishes that the global OCTG
market was depressed during a significant portion
of the original sunset review period which
suggests that prices would continue to be low
after the sunset period."
38
USDOC uses the financial statements to support
the notion that the companies would likely
"continue" to sell at low prices after the period.
This seems to be a reference to Acindar; Siderca
did not ship during the period, so the reference to
"continuing" to sell at low prices makes no sense
with respect to Siderca.
"We disagree with Siderca's assertion that the
company financial statements of Siderca and
Acindar are not relevant for our likelihood
analysis. Financial statements provide a good
understanding of the status of the entire company,
and reflect the company's overall selling
practices. Taken together, these data are relevant
indicators of likely future pricing trends. For
example, [discussion of data from Siderca
financial statement]. Given the weakened
Siderca never asserted that financial statements
are not relevant, only that they have limited value
in a multi-product company.

USDOC refers to "likely future pricing trends,"
suggesting that the data are used to predict each
company's likely future prices of OCTG. If
properly established, it could be relevant to a
"company-specific" finding and an "order-wide"
finding.

36 Id. at 7-8.
37 See Acindar 2000 Financial Statement found in Petitioners' 30 November 2005 Submission at
Exhibit 5, page 12.
38 ARG-16 at 9.

References to Financial Statement
 Observations
condition of Siderca at the end of the original
sunset review period, we consider that there was
no valid indication that a sudden turn-around in
the OCTG market was likely."39
"In addition, Acindar's fiscal 2000 statement
indicates: [data from Acindar's financial
statement]. Given the weakened condition during
the original sunset review period, including
substantial losses during fiscal 1999 and 2000,
we find it likely that Acindar's US sales of OCTG
during the original sunset review were at dumped
prices. As discussed above, we find that
Acindar's US AUVs were far below market
prices when most producers were losing money.
Even if, as Siderca now alleges, Acindar's
production of OCTG during the sunset period
represented only a short-lived experiment,
Acindar was, in fact, shipping and selling OCTG
in the United States during the original sunset
review period, 1995-2000. Thus, its shipments
and pricing of merchandise subject to the
dumping order, and the implications for
likelihood of continued shipping and selling at
dumped prices if the order were revoked
subsequent to the original sunset review, are
relevant to the Section 129 determination. . . .
Accepting arguendo Siderca's argument that
Acindar's OCTG production was a very small
portion of its overall production, nothing on the
record indicates any intention on the part of
Acindar to absent itself from the world OCTG
market during the sunset review period. Given
this, combined with the high likelihood that
Acindar dumped at the end of the sunset period,
we find (contrary to the implications of Siderca's
argument) that Acindar was likely to continue
selling in the United States at dumped prices if
the order were revoked."
40
USDOC uses the losses and weakened condition
of Acindar to find that Acindar likely was
dumping during the sunset review period. That
is, the financial statement is used to establish past
dumping.

USDOC implies that a finding of likely dumping
in the past by Acindar is sufficient for an order-
wide likelihood finding.
"We find additional support for this conclusion
from a statement in Acindar's financial statement
regarding its marketing stra tegy. Acindar states
'Acindar's strategy has been and will continue to
be to focus on the US market while using the
export market to stabilize its overall sales volume
during periods of slowdown in domestic
economic activity.'. . . . In other words, Acindar
USDOC relies on the narrative statement in
Acindar's financial statement, plus information
from the USITC's analysis, to support its view
that Acindar would export OCTG to the US after
the sunset period. No specific mention is made
of "likely" dumping either on a company- or
order-wide basis.

39 ARG-16 at 9-10.
40 ARG-16 at 10.

References to Financial Statement Observations
planned to continue export sales in order to
maintain its sales volume. The United States is
the world's largest market for OCTG. . . . We
have no evidence from Acindar itself that it
planned to exit the US market after the original
sunset review period. We also note that the ITC
finding that OCTG producers had incentive to
devote more of their productive capacity to
producing and shipping more to the US market
was sustained by the Appellate Body."
41

54. As can be seen from the chart above, the fi nancial statements were used by USDOC, for
various purposes in its Section 129 Determination, in an effort to demonstrate: 1) the "likely past
dumping" of Acindar; 2) that the Argentine producers would likely sell in the US market in the future;
and 3) future pricing trends in the US market. These findings then purported to serve, along with the
inference based on the volume decline, as the basis for the USDOC's order-wide likelihood
determination in the Section 129 Determination.

(b) Please explain, by referring to the relevan t parts of the record, whether the financial
statements of these two companies reflected the overall production operations of these
companies or whether the data relating to the subject product, i.e. OCTG, could be
separately identified.

Argentina's Answer to Question 13(b)

55. The financial statements reflect the overa ll operations of the companies unless otherwise
specified. For example, Acindar's financial stat ement contained disaggregated information in the
notes to its consolidated financial statement for diffe rent product divisions of its operation (referred to
as "segment" information in the financial statement). (See Argentina's First Written Submission, para.
120, citing ARG-27 at F-75.) No similar disaggregation appears in Siderca's financial statements.

56. Both companies provided USDOC with inform ation regarding the relative significance of its
OCTG production to its overall operations. Aci ndar explained that it produced OCTG only from
1998 to 2001, and that OCTG in those years acc ounted for less than 0.5 per cent of its total
production. ( See ARG-14 and ARG-28.) Siderca's cost data provided the relative volume of OCTG
and non-OCTG products, which showed that non-OCTG ranged from 46.51 per cent to 52.87 per cent
of Siderca's operations during the period. ( See ARG-21 (confidential) summarizing the volume of
OCTG and non-OCTG in each year from the data reported by Siderca. See also ARG-19 at page 6
and note 9.)

(c) Please explain whether the share of OCTG in these two companies' overall production
operations was taken into account in ma king the inference on the basis of these
statements that the OCTG market was depressed.

Argentina's Answer to Question 13(c)

57. Argentina believes that USDOC did not prope rly consider this fact. Acindar's OCTG
production accounted for less than 0.5 per cent of the company's total production. Accordingly, the

41 ARG-16 at 11.

losses associated with Acindar's overall operations w ould not be an appropriate basis for drawing an
inference about whether the OCTG market was depressed. As for Siderca, the USDOC made no
findings on the relationship of the company's overall production operations to the issue of whether the
OCTG market was depressed.

UNITED STATES

(d) Please explain why the USDOC made inferences regarding the state of the OCTG
industry from Acindar's financial statements when it had found the information
contained in those statements to be too broad for calculating a meaningful cost/price
trend analysis.

Q14.

(a) Please state your reaction to Argentina's proposition, in paragraph 42 of its Oral
Submission, that past events are not susceptible to prediction and that an investigating
authority can determine that either dumping o ccurred in the past or it did not or one
does not know.

(b) In your view, what is, if any, the difference between determining past dumping and past
likely dumping?

Q15. The Panel notes the following parts the USDOC's Section 129 Determination regarding
the state of the OCTG industry:

 We note that Acindar's US sales of OCTG occurred shortly before the end of the
original sunset review period. Absent evidence that Acindar intended to cease
selling in the United States, and absent evidence that prevailing market conditions
were likely to improve in the near future , we consider such sales indicative of
Acindar's likely future pricing behaviour were the order to be revoked. 42
(emphasis added)

 Given the weakened condition of Siderca at the end of the original sunset review
period, we consider that there was no valid indication that a sudden turn-around
in the OCTG market was likely.43 (emphasis added)

The Panel also notes Argentina's statement in paragraph 99 of its First Written Submission that
"USDOC's conclusion that there is "no valid indication that a sudden turn-around in the
OCTG market was likely" is demonstrably contrary to the evidence." In this regard, Argentina
refers to Siderca's letter dated 7 December 2005 (Exhibit ARG-19). That letter states:

 Also, Siderca's Financial Statement for the period ending 30 June 2000 shows
profitability increasing and links this increase with the recovery in the oil and gas
sector that was already underway.44 (footnote omitted)

This letter in turn refers to Siderca's letter dated 30 November 2005, found in Exhibit ARG-15.
Financial statement of Siderca as at 30 June 2000, attached to the mentioned letter, reads in
relevant parts:

42 ARG-16 at 8.
43 ARG-16 at 10.
44 ARG-19 at 7.

Improved crude and gas prices have been responsible for a steady recovery in the
petroleum and steel markets. In this cont ext, the level of business of the Company
during the first quarter of the year recorded a significant improvement , based on
a recovery of sales volumes and a gradual rise in prices on the international steel
tube market.45 (emphasis added)

Business in the first quarter measured by sales volume totalled 185,882 tons and
output reached 195,132 tons, more than in the same period for the previous year,
when volumes totalled 124,921 tons and 117,250 tons, respectively. These figures
are an indication of the recovery exp erienced in the sector, and exports in
particular.46 (emphasis added)

The Panel notes that financial statements of Siderca for the fiscal year ending 31 March 2000,
found in Exhibit ARG-36, reads in relevant parts:

 In the middle of the fiscal year oil pr ices began to record a significant recovers-
hitting US$ 30 per barrel in March- generating an increase in drilling and
investment activity by oil companies . This recovery came too late to have a
significant effect on the volume of sales for the year.47 (emphasis added)

 The recovery in crude prices and the good level of gas prices will influence a
steady recovery ion the oil a nd steel markets. This outlook, seen in the context of
the introduction of new installations and significant improvements in costs at
operating level, leads to an optimistic outlook for the coming year.

 The international market for seamless tubes has seen a profound globalization in
recent years.
48 (emphasis added)

The Panel also notes that the Preston Pub lishing data contained in Exhibit ARG-18
Attachment 3 indicates that the prices of all subject products showed an increasing trend
towards the end of the period of review of the Section 129 Determination at issue, specifically
from September 1999 through July 2000.

(a) Please indicate the period of review in th is Section 129 sunset review. Please explain
which parts of that review period the above-referenced financial statements covered.

(b) Did the USDOC consider the above-quoted in formation in the financial statements and
the Preston Publishing data in its Section 12 9 Determination, in particular with regard
to its proposition that the OCTG industry was depressed and that there was no
indication of recovery in the near future?

Please elaborate by referring to the relevant parts of the record.

45 ARG-15, Attachment 1 at 1.
46 ARG-15, Attachment 1 at 2.
47 ARG-36 at 2.
48 ARG-36 at 15.

BOTH PARTIES

Q16. The Panel notes Argentina's assertion in paragraph 30 of its Oral Statement that in the
period of review of the Section 129 Sunset Determination at issue, the prices of the subject
product in the United States were significantly higher than other markets. Please elaborate by
referring to the relevant parts of the record of the measure at issue.

Argentina's Answer to Question 16

58. Central to the USDOC's dete rmination that Acindar was "likely" dumping during the sunset
review period was based on a comparison of Acindar's US sales to the prevailing prices in the US
market. The Section 129 Determination provides th at "Our analysis indicates that Acindar's US
selling prices during the sunset review period were substantially lower than prevailing US market
prices for the corresponding OCTG products."49

59. As Argentina explained in its Opening Oral Statement to the Panel, it should not have been
surprising to the USDOC that the US domestic prices relied upon by USDOC were "substantially"
higher than Acindar's prices. As Argentina not ed, the USITC found that US market prices were
significantly higher than world market prices. This Panel upheld USITC's affirmative determination
noting, among other things, that the US price of OCTG during the review period was significantly
higher than the price of OCTG in other markets.
50

60. This point is also reflected in the Secti on 129 Determination (ARG-16) at 11, where the
USDOC states:

We also note that the ITC's finding that OCTG producers had incentive to devote
more of their productive capacity to producing and shipping more to the US market
was sustained by the Appellate Body.
61. The fact that the observed prices of Acindar we re less than significantly elevated US prices,
however, does not support the view that Acindar was dumping. A company presumably can sell
below a significantly elevated price in the consum ing market (the highest in the world) without
"dumping" within the meaning of Article 2. In th is regard, such a comparison is further suspect
particularly in light of the recognition by the United States that Acindar's tube division was
profitable.
51 The USITC's finding, already accepted by th e Panel, thus further weakens the flawed
reasoning relied upon by the USDOC.

62. Argentina notes that these arguments were not advanced during the Section 129 proceeding
and that the findings of the ITC are not part of the record of the Section 129 proceeding. This
demonstrates the very point that Argentina wishes to make.

63. The problem stems from the failure of USDOC to disclose the basis of its comparison in
sufficient time so that the Argentine exporters coul d explain why such a comparison was flawed. As
Argentina's written submissions demonstrate, the US DOC's likely past dumping analysis suffers from
a host of substantive flaws and is inconsistent w ith numerous US WTO obligations. The record does
not reveal any attempt by USDOC to ensure that the prices it reviewed related to the same products
within the specific categories, or that basic diffe rences in points of sale and transportation were the
same. The USDOC never even asked Acindar any qu estions about the observed prices, either of its
exports or the average US prices of the OCTG pr oduct groupings. The Argentine exporters certainly
would have pointed out the deficiencies with US DOC's methodology had they known that this was

49 USDOC Section 129 Determination at 7 (ARG-16).
50 See Panel Report, paras. 7.291, 7.297.
51 US Second Submission, 43.

the comparison upon which USDOC intended to conc lude that Acindar likely dumped during the
sunset period.

64. The Panel's question thus highlights USDOC's fa ilure to inform the interested parties of the
essential facts under consideration that formed the basi s for its decision, given that five USDOC file
memoranda are dated 16 December 2005, were discl osed contemporaneously with the Section 129
Determination itself and they were not provided to the interested par ties before a final determination
was made in the Section 129 proceeding.

USDOC's VOLUME ANALYSIS

Q17.

(a) How, if at all, did the original panel address the parties' claims and arguments relating
to the USDOC's volume analysis? Did it exercise "judicial economy"?

Argentina's Answer to Question 17(a)

65. The Panel addressed the issue of volume and ma de the relevant factual findings, but decided
to exercise judicial economy and declined to make a legal finding on the consistency of the USDOC's
inference that dumping would be likely based on the volume decline.

66. The United States seeks to take advantage of this Panel's decision to leave the WTO-
consistency of USDOC's volume based inference of likelihood. In failing to conduct any analysis of
the volume issue, the USDOC has sent an unequivocal message to Argentina and to this Panel:
USDOC can rely on the inference arising from declining import volumes without an analysis of the
cause for the decrease.
52 Clearly, the United States has taken advantage of this Panel's decision to
leave this issue unresolved.

67. Paragraph 6.11 of the Panel Report is clear that:

We note that in paragraphs 7.201 – 7.20 6 below, we made the relevant factual
findings regarding Argentina's claim challe nging the USDOC's determinations in the
OCTG sunset review. In particular, in pa ragraph 7.202, we observed as a matter of
fact that the USDOC had based its likelihood determination on the facts that dumping
had continued over the life of the measure and that import volumes of the subject
product had declined. It is, therefore, cl ear that we have made relevant factual
findings in this regard. As far as legal fi ndings are concerned, we note that we have
decided Argentina's claim regarding the US DOC's likelihood determinations in the
OCTG sunset review. We have found that the USDOC's reliance on the existence of
the original dumping margin was inconsistent with Article 11.3 of the Anti-Dumping
Agreement. We therefore did not need to address whether the USDOC's reliance on
declined import volumes was yet another ac tion inconsistent with that article.
Argentina argues that we should make a findi ng in this regard in case our decision is
appealed and the Appellate Body finds that the USDOC's reliance on the original
dumping margin was in fact consistent w ith Article 11.3. We do not consider,
however, that it would be appropriate to make an additional legal finding based on the
hypothetical situation Argentina posits. We therefore decline to make additional
findings in this regard.
68. Paragraph 7.221 of the Panel Report states:

52 ARG-16 at 2 n.4 and 6 n.12.

We recall that 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 th e imposition. We have found that the
factual basis of the first one is not proper . We therefore conclude that the USDOC's
likelihood determination in the instant sunset review was inconsistent with
Article 11.3 of the Anti-Dumping Agreement.
53
(b) What considerations should guide this Pa nel in addressing the parties' claims and
arguments in these 21.5 DSU proceedings? Would any prejudice arise to any party in
the event the Panel did, or did not, address the volume analysis?

Argentina's Answer to Question 17(b)

69. The considerations that should guide the pa nel are: 1) the rights and obligations of
Article 11.3 of the ADA; and 2) the rights and obligations under Articles 3.2, 3.7, and 11 of the DSU.

70. In this compliance proceeding, the United States must bring itself into compliance with
Article 11.3 of the Anti-Dumping Agreement. The United States chose to attempt to achieve
compliance with Article 11.3 through a Section 129 proceeding. In that proceeding, USDOC could
have either: 1) revoked the anti- dumping measure; or 2) continued the measure. USDOC chose the
latter, and it expressly based its decision, in part, on the inference that it drew from the fact that
import volumes declined. In order to dete rmine whether the USDOC decision brought the
United States into compliance with its oblig ations under Article 11.3 of the Anti-Dumping
Agreement, the Panel must conduct a searching revi ew of the USDOC's reasoning, which includes,
expressly, the inference drawn from the declining volumes.

71. DSU Articles 3.2, 3.7, and 11 compel the same conclusion. Article 3.2 states that the dispute
settlement system "serves to preserve the right s and obligations of Members under the covered
agreements". The purpose of this compliance proc eeding is to determine whether the United States
has complied with its Article 11.3 obligation. If the Panel tries to resolve that issue without
examining the stated basis of that decision, it will fa il to adjudicate this matter in a way that preserves
the rights and obligations of the Members.

72. Further, DSU Article 3.7 states that, absent a mutually agreed solution, the first objective of
the dispute settlement mechanism is usually to secure the withdrawal of the measures concerned if
these are found to be inconsistent with the cove red agreements". The continuation of the anti-
dumping measure was found to violate Article 11.3, a nd the United States has chosen not to withdraw
the measure, despite DSU Article 3.7 and despite the fact that termination of the anti-dumping
measure is the "rule" established by Article 11.3. A decision not to review one of the stated bases for
the decision not to withdraw the measure would undermine Article 11.3 of the Anti-dumping
Agreement and Article 3.7 of the DSU.

73. Finally, the Panel has an obligation unde r Article 11 of the DSU to "make an objective
assessment of the matter before it …". The "ma tter before" the Panel in the context of this
Article 21.5 proceeding is the US compliance with Article 11.3, which the United States claims to
have achieved, in part, by the inference it drew from decreased import volumes.

74. The Panel can also consider the prejudice that would flow from its decision, although
Argentina believes that consideration of prejudi ce cannot prevail over the Panel's obligations to
resolve the matter before it, wh ich includes an obligation to make an objective assessment of the
matter. In this case, the evaluation of rela tive prejudice leads to the same conclusion as the

53 Panel Report, para. 7.221.

application of Article 11.3 of the Anti-dumping Agreem ent and Articles 3.2, 3.7 and 11 of the DSU.
A decision not to address the USDOC's reliance on the volume inference would cause prejudice to
Argentina, which has consistently alleged that USDOC's volume inference is inconsistent with
Article 11.3. In contrast, the United States can claim no prejudice from the Panel's assessment of the
issue. The United States chose to rely on the volum e inference as a basis of its determination, and it
therefore subjected that analysis to scrutiny. In other words, the volume inference was one of the
"means of implementation" that the USDOC chose, and it cannot be prejudiced by the Panel's
assessment of the issue. Complying with one's obligations is not "prejudice".

(c) Is the USDOC's volume analysis part of the measure taken to comply with the DSB
recommendations and rulings for the purposes of Article 21.5 DSU? Why or why not?
Would it have been possible for the orig inal panel to address the USDOC's volume
analysis? Please indicate the relevance, if any, of the Appellate Body Reports in EC –
 Bed Linen (Article 21.5 – India
 ) and US – Softwood Lumber IV (Article 21.5 – Canada) in
your responses to the above questions.

Argentina's Answer to Question 17(c)

75. Argentina would respectfully refer the Pane l to paragraphs 81–98 of Argentina's Second
Written Submission in which Argen tina provided extensive argumentati on that demonstrated that the
USDOC's volume analysis was part of the US "measure taken to comply." Argentina urges the Panel
to review these paragraphs carefully as they are fu lly responsive to the first two subsidiary questions
of 17(c).

76. As for whether "it have been possible for the original panel to address the USDOC's volume
analysis", Argentina would again refer the Panel to paragraph 6.11 of its original Report, which
unambiguously provides the answer: "It is, therefor e, clear that we have made relevant factual
findings in this regard. As far as legal finding s are concerned, we note that we have decided
Argentina's claim regarding the USDOC's likelihood de terminations in the OCTG sunset review. We
have found that the USDOC's reliance on the ex istence of the original dumping margin was
inconsistent with Article 11.3 of the Anti-Dumping Agreement. We therefore did not need to address
whether the USDOC's reliance on declined import vol umes was yet another action inconsistent with
that article." [Emphasis added].

77. It is clear from this passage that the Panel coul d have resolved the issue, but that it chose not
to do so because it found that the measure in question violated Article 11.3 for other reasons.

78. Argentina also notes that the record of the Section 129 determination demonstrates that the
volume inference was part of the Section 129 pr oceeding. Representatives of the US domestic
industry urged the USDOC to use the volume infere nce to support its decision to continue the
measure. They argued that

In addition to showing that Siderca dumpe d OCTG on a global basis during the POR,
other available evidence clearly shows that Siderca could not ship OCTG to the
United States with the discipline of the order in place. Indeed, Siderca ceased
shipping OCTG to the United States altogether after the imposition of the order. As
indicated above, in each of the four administrative reviews concluded during the POR
for this proceeding, the Department determ ined that Siderca did not have a single
shipment of subject merchandise to the United States. [FN] Fourth Administrative
Review, 65 Fed. Reg. at 8949; Third Admi nistrative Review, 64 Fed. Reg. at 4070;
Second Administrative Review, 63 Fed. Reg. at 49090; First Administrative Review,
62 Fed. Reg. at 18748.

Siderca's complete cessation of imports following the issuance of the order shows that
it could not sell in the United States without dumping and that, to re-enter the US
market, it would have to resume dumping. For this reason as well, the Department
should not revoke the order in this case.
54
79. This line of argument was reflected in the S ection 129 determination when the USDOC stated
that "Declining import volumes after, and appare ntly resulting from, imposition of an antidumping
order indicate that exporters would need to dump to sell at pre-order levels." ARG-16 at page 11.
Also, as the Panel has already recognized in que stion 18, Siderca provided information directly
relevant to the volume inference. It also rebutted the argument by the US industry. See ARG-19 at
pages 7-8. Thus, the record of the Section 129 pr oceeding tells a different story than the argument
that the United States offers this panel. The vol ume inference was part of the proceeding, it was
explicitly part of the Section 129 Determination, an d there is no basis to remove it from the Panel's
assessment of the measure taken to comply.

UNITED STATES

Q18. The Panel notes Argentina's argument that the USDOC disregarded the comments
made by the Argentine exporters with regard to the decline in the volume of imports. The Panel
also notes the US' argument that these comments were not germane to the issue. Siderca's
response to the questionnaire to which Argentina refers in this regard, reads in relevant part:

 Whatever the significance of a decline in export volume may be as a general
matter, Siderca knows that, with respect to Siderca, it does not mean that the
product could not be shipped without dumping. The cost data (even with the
limitations explained above) supports Siderca's position: Siderca is a cost-efficient
producer of OCTG and could have shipped OCTG products profitably to the
United States.
55

(a) Please explain why the USDOC found these comm ents not to be germane to the issue of
the decline in the volume of imports.

ARGENTINA

(b) Is there any other reference on the record that contains Argentine exporters' comments
with regard to the decline in the volume of imports?

Argentina's Answer to Question 18(b)

80. As Argentina explained in its First Submi ssion, Siderca offered evidence and arguments to
explain that the volume decline was not related to the company's ability to participate in the US
market without dumping.56

81. With respect to this evidence, which was pr obative of the absence of a likelihood of dumping,
there was no analysis by USDOC. Indeed, there is no discussion of this evidence in the Section 129
Determination.

82. In the Section 129 proceeding, Siderca offere d evidence regarding the diversification of its
OCTG export markets following the imposition of the US order.
57 Siderca demonstrated that the

54 ARG-27 at pages 7, 8.
55 Response of Siderca to the USDOC's Questionnaire (Exhibit ARG-15 at 10).
56 See Argentina's First Submission, paras. 102-107.
57 Siderca's Response to Questionnaire (30 Nov. 2005) at 7-10 (ARG-15).

company had diversified its export markets and th at it was not subject to any other anti-dumping
measures, and that if the US order were revoke d, dumping would not be likely to recur in the
United States. Siderca noted that its "sales processes underwent significant changes during the 1995 –
2000 period, reflecting the further diversification of Siderca's export markets and its strategy of
providing higher-value products and services to its customers throughout the world". 58 Siderca
explained that the company had "developed an exte nsive network of international sales offices, and
implemented a strategy to strengthen and maintain its international presence" and this included "a
distribution network with more than 20 offices around the world". 59 Siderca further substantiated its
position with reference to the establishment of a ser ies of long-term agreements with customers and
international finishing plants" from around the world.60

83. Regarding the diversification of its export ma rkets, Siderca explained that it had consolidated
the company's strategic positioning in internationa l markets during subsequent years, including by
expanding from its traditional base in Latin Americ a, and increasing significantly its shipments to
Africa and Russia, in 1996 in particular. 61 Siderca also noted how it "reacted to the economic and
financial crises in the emerging markets of Southeast Asia and Latin America by introducing flexible
production programs and the development of made-to-order products and services for its international
clients," and identified the new stocking programs that the company had entered into in Venezuela,
Nigeria, Canada, Bolivia, Thailand, Azerbaijan, Malaysia, and Ecuador.62

84. Siderca also commented on the Argentin e market, explaining that the company had
introduced regional stocking programs and "just-in-t ime" inventory management agreements with
several of its Argentine customers, developing re gional storage facilities in Las Heras, Barranquilla
and Desfiladero Bayo.
63 The effect of these measures was to reduce order and transport time for local
customers, and to increase Siderca's ability to provide value added services at the site of the oil and
gas production. Siderca explained that these agreemen ts "proved to be important to Siderca and its
customers during the crisis in the oil market in 1998/99, allowing customers to increase efficiency and
reduce costs." 64

85. Siderca summarized its evidence as follows:

As can be seen through this summary (and the discussion in the cited annual reports),
Siderca continued and intensified the process of diversifying products, services, and
markets during the 1995-2000 period. By the end of the period under analysis,
Siderca exported its OCTG to approximately 60 countries. In some regions, such as
Canada and Africa, the increase in OCTG exports over this period was significant.
During this period, no other countries maintained anti-dumping measures against
Siderca, nor has Siderca been accused of dumping or other unfair trade practice
during or after this period.
65
86. This evidence is clearly probative of whether dumping would be likely to continue or recur.
Yet, there was no analysis by USDOC of this evidence. Indeed, these issues are not mentioned
anywhere in the 2005 likelihood determination. This is all the more striking given the Appellate
Body's admonishment that "a case-specific analysis of the factors behind a cessation of imports or a

58 Siderca's Response to Questionnaire (30 Nov. 2005) at 7 (ARG-15).
59 Siderca's Response to Questionnaire (30 Nov. 2005) at 7 (ARG-15).
60 Siderca's Response to Questionnaire (30 Nov. 2005) at 7-8 (ARG-15).
61 Siderca's Response to Questionnaire (30 Nov. 2005) at 8 (ARG-15).
62 Siderca's Response to Questionnaire (30 Nov. 2005) at 8 (ARG-15).
63 Siderca's Response to Questionnaire (30 Nov. 2005) at 8 (ARG-15).
64 Siderca's Response to Questionnaire (30 Nov. 2005) at 8-9 (ARG-15).
65 Siderca's Response to Questionnaire (30 Nov. 2005) at 9 (ARG-15).

decline in import volumes (when dumping is eliminat ed) will be necessary to determine that dumping
will recur if the duty is terminated".
66

CLAIMS UNDER ARTICLE 6

ARTICLES 6.1 AND 6.2

Q19.

(a) The Panel notes Argentina's allegation that the USDOC failed to give the Argentine
exporters an ample opportunity to submit ev idence, inconsistently with Article 6.1
because it:

• failed to issue supplemental questionnaires, desp ite the fact that it had some questions
about the information submitted;
• failed to issue a preliminary redetermination;
• failed to establish a schedule to allow interest ed parties to submit comments, including
rebuttal comments, to USDOC;
• failed to request clarification or additional documentation from the responding parties;
and
• failed to hold a hearing.67

The Panel also notes Argentina's assertion that these defects also violated Article 6.2 of the
Agreement.

 Please explain more specifically how exactl y these alleged defects violated these two
provisions.

Argentina's Answer to Question 19(a)

87. As a preliminary remark, Argentina believes it is important to be clear that Argentina is not
asking this Panel to be prescriptive, i.e., Argentina is not asking the Panel to tell the United States
what specific measures it should have taken in order to have fulfilled its obligations under Article 6.1.
Instead, Argentina simply seeks a ruling on whether the measures the United States did take met the
high standards of this provision.

88. Indeed, Argentina made this clear in paragr aph 107 of its Second Submission: "This Panel
need not provide an exhaustive listing of the measures that are, or are not, required by Article 6.1.
Instead, it has to address one core issue: whether the USDOC actions in this case fell short of the
requirements of Article 6.1."

89. In assessing whether the United States fulfilled th e requirements of Article 6.1, it is important
to recall that the Appellate Body has rule d that Articles 6.1 and 6.2 set out "the fundamental due
process rights " to which interested parties are entitled. This is the benchmark against which the
USDOC actions must be judged – whether the "funda mental due process rights" of the Argentine
interested parties were respected or not. Argen tina's First and Second Submissions set out in some
detail why the USDOC breached the fundamental due process rights of the respondent interested

66 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 177.
67 First Written Submission of Argentina, para. 144.

parties by failing to provide them with "ample opportunity" to present in writing all evidence that they
considered relevant in respect of the investigation in question.

90. Argentina recognizes that the US statements to the Article 21.3(c) Arbitrator do not
technically "bind" the United States. But they ser ve to illustrate the wide gap between what the
United States claimed was required
 under Article 6 of the Anti-Dumping Agreement, and what the
USDOC actually did in this case. Thus, the US statements help to illustrate the violations of Article 6.
The Arbitrator's report recorded the US position as follows: "…the USDOC also needs sufficient time
to ensure that it complies with its obligations of transparency and due process under Articles 6 and
12" of the Agreement. Arbitrator's Award, para. 10.

91. The United States set out a long list of procedural steps that it would be required to undertake,
including supplemental questionnaires, a preliminary redetermination, a schedule to allow interested
parties to submit comments, and a hearing. Desp ite these assertions to the Arbitrator, none of these
procedural steps were ever fulfilled.

92. The US statements thus highlight the failure of the United States to fulfil the "obligations of
transparency and due process" that it had earlier recognized expressly.

93. Moreover, as the Appellate Body has made cl ear, the right of respondents to present relevant
evidence concomitantly requires the investigating authority to take into account the information
submitted.
68 Yet the USDOC simply ignored the lette r from Siderca that explained that the
allegations by the Petitioners regarding Siderca's cost data were wrong. The United States argues that
"there is no obligation under Article 6.1 for a Member to respond to a letter". Yet, as the Appellate
Body has made clear, the USDOC was obligated to take account of the information submitted by
Siderca.

94. Far from "taking account" of the Siderca's inform ation, the Department rejected it and issued
its final determination.

(b) Did the Argentine exporters request a hearing in these Section 129 proceedings?

Argentina's Answer to Question 19(b)

95. Initially Argentina believes it is important to r ecognize that a hearing is not exhaustive of the
requirements of Article 6.2. The first sentence of Article 6.2 is stated in very broad terms:
"Throughout the anti-dumping investiga tion all interested parties shall have a full opportunity for the
defence of their interests." The provision goes on to state that interested parties are entitled to a
hearing, but other
 measures, unrelated to hearings, could br each this provision as well. As noted in
our prior pleadings, in EC – Tube or Pipe Fittings, the Appellate Body found that the EC breached its
obligations under Article 6.2 for fa iling to disclose to the interested parties during an anti-dumping
investigation certain information on injury factors.

96. Thus, the test is not simply whether there was a hearing but rather, more generally, whether
the responding parties had a "full opportunity" to defend their interests.

97. As for the hearing in this case: as ar gued in Argentina's Second Submission, the
United States had told Argentina and the Article 21. 3(c) Arbitrator that it intended to follow specific
procedures, which included a hearing. Sider ca specifically asked the USDOC to provide more
information regarding the "timing of any hearing, and how the parties will be permitted to have access
to and comment on the essential facts being used by the Department to make its determination".
69

68 Appellate Body Report, Mexico – Anti-Dumping Measures on Rice, para. 292.
69 7 December 2005 Letter from Siderca to USDOC at 3 (ARG-19).

The USDOC simply ignored the question. Argentina recalls that the original Panel found that the
USDOC breached Article 6.2 because of the lack of a hearing (paras. 7.235, 8.1(d)(i)). Following the
express USDOC statements to the Arbitrator, if the USDOC subsequently decided it would not
 be
holding a hearing, it should have advised the parties.

Q20.

(a) The Panel notes Argentina's allegation that by failing to respond to Siderca's letter dated
7 December 2005, the USDOC acted inconsistently with Articles 6.1 and 6.2.
70 P l e a s e
explain how exactly failure to reply to this letter violated the USDOC's obligations under
Articles 6.1 and 6.2.

Argentina's Answer to Question 20(a)

98. Argentina would initially observe that its claim does not simply stem from the USDOC's
failure to respond to a particular letter. Wh ile the 7 December 2005 letter from Siderca to the
USDOC provided a detailed review of the problems with the Petitioners' approach and use of facts, as
well as challenging the Petitioners' conclusions,
71 Siderca's letter also, and equally important, pointed
out that the Section 129 proceeding suffered from a sev ere lack of transparency. In this regard,
Siderca advised that there had been no communicat ion from the USDOC as to how it would use the
information it solicited from the parties, what proce dures would be used to analyze the information,
the timing of any hearing, or how the parties w ould be permitted to have access to and comment on
the essential facts being used by the USDOC to make its determination. 72 Siderca also pointed out
that the allegations by the Petitioners regarding Ac indar were wrong, and did not form an adequate
basis for a country-wide determination.73

99. It is in this context, then, that the Pa nel should consider USDOC' s failure to respond to
Siderca's 7 December letter and, more importan tly, to address the lack of transparency and due
process concerns that were raised by Siderca. I ndeed, the parties to the Section 129 proceeding only
found out on 16 December that there would be no add itional procedures, and that the final results had
been issued. This falls far short of the US obl igation to provide "liberal opportunities" to the
responding parties to defend their interests.

100. Referring to Articles 6.1 and 6.2 in the cont ext of the present dispute, the Appellate Body
stated that:

(a) These provisions set out the fundamental due process rights to which interested
parties are entitled in anti-dumping investiga tions and reviews. Articles 6.1 and 6.2
require that the opportunities afforded inter ested parties for presentation of evidence
and defence of their interests be "ample" and "full", respectively. In the context of
these provisions, these two adjectives suggest there should be liberal opportunities for
respondents to defend their interests.
 74
101. The interested parties thus had little opportunity – let alone "ample" or "full" opportunity – to
present in writing all evidence that they considered to be relevant for the Section 129 Determination.
The United States represented to Argentina in the Artic le 21.3 arbitration that it would engage in a
multi-stage process in which information would be developed, refined, a nd debated through written
and oral argument. Instead, the USDOC provided a "black box" – information entered, and a decision

70 Second Written Submission of Argentina, para. 105.
71 Letter from Siderca to USDOC, 7 December 2005 at 4-8 (public version) (ARG-19).
72 Letter from Siderca to USDOC, 7 December 2005 at 3 (public version) (ARG-19).
73 Letter from Siderca to USDOC, 7 December 2005 at 8 (public version) (ARG-19).
74 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews, para. 241.

came out. No argument; not even notice that its plan s had changed and that parties would not have an
opportunity to provide written and oral argument. The failure of the United States to accord basic due
process rights to the interested parties fell far short of the requirements of Article 6.1.

(b) Could, in your view, the fact that Siderca sen t this letter and that it became part of the
record mean that Articles 6.1 and 6.2 were satisfied?

Argentina's Answer to Question 20(b)

102. No. In fact, it highlights just the opposite point – that the USDOC failed to discharge US due
process and transparency obligations that are at the heart of Articles 6.1 and 6.2 and which ensure that
interested parties are in a position to defend their interests by having "full" and "ample" opportunity to
defend their interests.

103. During the Mexico – Rice dispute, the United States argued before the Panel that:

The right of exporters to know the allegati ons made against them and the "essential
facts" under consideration by the investigating authority lie at the heart of many
provisions within the AD Agreement. Article 6.1, for example, requires that "all
interested parties" be given "notice of the information which the authorities require
and ample opportunity to present in writing a ll evidence which they consider relevant
in respect of the investigation in question." See US First Submission in Mexico –
Rice (WT/DS295), 22 Mar. 2004
104. Argentina agrees fully with this US asserti on that that right of exporters to know the
allegations against them indeed lies at the heart of many provisions in the Anti-Dumping Agreement,
and regrets that such rights were denied to th e affected Argentine respondents in the present case.
Siderca's 7 December 2005 Letter to the USDOC expr essed such concerns and indicated that there
was significant uncertainty as to the procedures for comment and precisely what information the
Department would be relying on for purposes of it s determination. USDOC did not respond thus
precluding the Argentine companies from knowing wh at the essential facts and information that
would serve as the basis for DOC's analysis and, hence, prevented the Argentine respondents from
being in a position "to present in writing all evidence which they consider relevant in respect of the
investigation in question," as required by Article 6.1, and also deprived them of a "full opportunity for
the defence of their interests" as required by Article 6.2.

UNITED STATES

(c) How did the USDOC consider the views expressed in this letter?

ARTICLE 6.4

ARGENTINA

Q21. The Panel notes Argentina's argument that the USDOC failed to make six memoranda
available to the Argentine exporters.

(a) With respect to each one of these memora nda, please describe what information they
contained as relevant to the obligation in Arti cle 6.4. Please explain whether they also
contained the USDOC's reasoning. Does Article 6.4 require disclosure of an
investigating authority's internal analysis and reasoning ? Did the information have a
confidential status in these Section 129 proceedings, and, if so, how does this relate to the
obligation in Article 6.4? On what date was the information made available to the
Argentine exporters?

Argentina's Answer to Question 21(a)

105. Article 6.4 obligated the USDOC to provide to the Argentine respondents "all information"
relevant to the presentation of their cases that was not confidential, and was used by the Department.
The USDOC memoranda identified in Argentina's claim meet the criteria for "information" that the
responding parties in this case had a right to see. The Department denied them this right.

106. The Panel should reject the repeated assertions by the United States that, in its view, the
information was "not relevant to the presentati on of the respondent interested party's case".
75 T h e
Appellate Body made clear that whether or not the information is "relevant" is to be determined from
the perspective of the interested par ties, not the investigating authority .76 Moreover, as such
information was "used by the authorities in an an ti-dumping investigation" within the meaning of
Article 6.4, it clearly was "relevant".

107. The Appellate Body made clear in EC – Tube or Pipe Fittings , that Article 6.4 requires that,
whenever practicable, investigating authorities must provide timely opportunities for all interested
parties to see and prepare presentations on the basis of "all information" that (a) is relevant to the
presentation of the cases of the interested parties; (b) is not confidential as defined in Article 6.5; and
(c) is used by the authorities in an anti-dumpi ng investigation. The Section 129 Determination
included six memoranda to file, fi ve of which are dated 16 December 2005, the day of the release of
the Section 129 Determination, satisfy these criteria. Indeed, there was a public version for each of
the confidential versions of the memoranda. Th e USDOC was obligated to provide a reasonable
summary of these documents. At a minimum, disclosure of these documents during the course of the
Section 129 proceeding would have at least alerted the Argentine respondents as to there existence,
and that USDOC was intending to use the documents to support its analysis for purposes of the
Section 129 Determination.

108. Because five of the six memoranda are dated 16 December 2005, the day of the release of the
Section 129 Determination, there can be no dispute that the respondent parties did not have access to
any of these memoranda in advance of USDOC's is suance of USDOC's Section 129 Determination.
As is explained further below, these memoranda provided information that the USDOC relied on for
purposes of its Section 129 Determination. This is confirmed by several references in the Section 129
Determination to these memoranda.

109. The USDOC memoranda were provided as Exhibits by Argentina:

• Exhibit ARG-18 (22 November 2005 USDOC Memorandum to file from Fred Baker
(public version))
o This memorandum contained three attachments, including: 1) the response from
the Embassy of Argentina to the USDOC's 14 October 2005 request for
information ("Appendix I"); 2) a listing of all entries of subject merchandise
during the period August 1995 through July 2000, obtained from by USDOC
from US Customs and Border Protection ("Appendix II") (Note, however, that in
the public version of ARG-18, there is nothing in Appendix II – simply a slip
sheet that states "Appendix Not Susceptible to Public Summary); and 3) Average
unit prices for ten product groups for the sunset period, obtained from Preston
Publishing, Inc. ("Appendix III").

75 US Second Submission, para. 70.
76 Appellate Body Report, EC - Pipe Fittings, para. 145.

• Exhibit ARG-21 (16 December 2005 USDOC Memorandum to file from Mark Flessner
regarding "Inconsistencies in data reported by Siderca" (public version)).
o The chart in this document purports to be the "complete discussion of the
discrepancies" cited by USDOC to justify its decision to disregard Siderca's cost
data. In this document, the USDOC mak es observations regarding certain of the
average costs reported by Siderca, reveal s that it had certain expectations about
the cost relationships (alloy versus carbon; OCTG versus non-OCTG), reveals
that its expectations were not met, an d states that it is "convinced" that the
reporting must be wrong based on its understanding of what it supposes the cost
relationship should be between these product groupings.
• Exhibit ARG-22 (16 December 2005 USDOC Memorandum to file from Mark Flessner
regarding "Information from Preston Publishing Company").
o Public document describing basic bac kground information regarding Preston
Publishing.
• Exhibit ARG-23 (16 December 2005 USDOC Memorandum to file from Mark Flessner)
(public version)
o Public version of a proprietary docume nt describing "Inconsistencies in data
reported by Acindar" (public version)). Very little can be discerned from the
public version of this document.
• Exhibit ARG-24 (16 December 2005 USDOC Memorandum to file from Mark Flessner)
o Containing certain "Securities and Exchange Commission Filings of Domestic
OCTG Producers".
• Exhibit ARG-25 (16 December 2005 USDOC Memorandum to file from Fred Baker)
o Providing other "Information for the Record" consisting of several documents
from the 2000 sunset review, including: 1) 2 Aug. 2000 Submission from Siderca
(Appendix I); 2) 2 Aug. 2000 Submissi on from Petitioners (Appendix II); 3)
2 Aug. 2000 Submission from North Star Steel Ohio (Appendix III); 4)
7 Aug. 2000 rebuttal comments from North Star Steel Ohio (Appendix IV);.
110. In USDOC's Section 129 Determination, there are several references to these USDOC
memoranda to the file, where the USDOC cites to the memoranda to support various conclusions or
findings that are part of the Section 129 Determination. For example,

• Section 129 Determination at 4-5, n. 10 (referencing Memorandum to File, dated
16 December 2005)
• Section 129 Determination at 7 ("This comp arison, which includes Acindar's business
proprietary information, is set forth in the memorandum to the file dated
16 December 2005")
• Section 129 Determination at 8 ("A complete discussion of these discrepancies
necessitates discussion of Siderca's business proprietary information; for specific
examples, see, the Department's Memorandum to the File dates 16 December 2005)

• Section 129 Determination at 11 (referenci ng financial statemen ts of Lone Star,
Maverick, and North Star as set forth in the memorandum to the file dated
16 December 2005)
111. As for the criteria set forth in EC – Pipe Fittings , each of the five USDOC file memoranda
contained information that was used by USDOC in the Section 129 proceeding and that served as the
basis for its Section 129 Determination. The memo randa clearly satisfy the criteria established by the
EC – Pipe Fittings panel: (a) the information is directly re levant to the presentation of the Argentine
interested parties' cases; (b) the information is no t confidential as defined in Article 6.5; and (c) the
information was used by USDOC in the Section 129 proceeding and was identified in USDOC's
Section 129 Determination.

112. In evaluating this claim, the Panel must also consider the absolute lack of information about
what the USDOC was doing. In a typical anti-dum ping investigation or review, the parties know
what comparisons will be made. In contrast in this case, the USDOC never explained its
"expectations" that it would apply in evaluating Side rca's costs, nor did USDOC reveal that it would
compare Acindar's export prices to US market pric es of general product gr oupings. When Siderca
asked the USDOC to explain what it was doing (ARG-19, pages 2-3), the USDOC did not even
respond. The responses came with the final determination.

113. Finally, the Panel should not be confused by th e issue of confidentiality and the obligations of
Article 6.4 as they apply in this case. The fact that a party submits confidential information in no way
limits the authority's obligation to inform that part y of critical information related to the authority's
evaluation of that information. For example, USDOC cannot possibly claim that the confidential
nature of Siderca's cost information prevented th e USDOC from advising Siderca of its concerns over
the consistency of the company's own cost informati on. Yet, the failure to do so prevented Siderca
from presenting its case.

BOTH PARTIES

(b) Please explain whether it was "practicable" within the meaning of Article 6.4 of the
Agreement for the USDOC to make the se memoranda available to the Argentine
exporters in these Section 129 proceedings.

Argentina's Answer to Question 21(b)

114. It was clearly "practicable" within the m eaning of Article 6.4 of the Agreement for the
USDOC to have made these memoranda available to the Argentine exporters during the Section 129
proceeding.

115. In general terms, what is "practicable" fo r the purposes of Article 6.4 will need to be
determined on a case-by-case basis. However, for the specific purpose of this case, the Panel can
readily reject any argument that any reduced tim e frames (e.g., based on the RPT set by the
Arbitrator) would render US compliance with Ar ticle 6.4 somehow "impracticable." The word
"practicable" simply does not require this Panel to take into account the fact that the United States
purportedly conducted its Section 12 9 determination under a shorter time frame than it ordinarily
conducts a sunset review.

116. First, Article 11.4 provides that Article 6 – in cluding Article 6.4 - applies to sunset review
proceedings. There is no notion that this requireme nt should be excused in the present context. The
plain text of the Agreement contradicts any argum ent that a reduced period of time rendered the
obligations of Article 6.4 somehow inapplicable in an Article 11.3 proceeding. Second, as Argentina
has argued, all WTO obligations apply on a concurre nt and overlapping basis. The United States was

required to comply with its obligations under Artic le 6.4 while concurrently complying with its
obligation under Article 21.3(c) to bring its measures into conformity with its WTO obligations in the
shortest period of time possible - which the Arbitrat or determined to be tw elve months. Twelve
months – a full year – is a significant period of time. Indeed, that is enough time for the United States
to have conducted an entire review under Article 11.3. The United States clearly could have
undertaken various aspects of the review concurrently with its revision of the waiver regulation. The
fact is that the United States simply chose not to do so. It cannot complain now for its failure in this
regard. Third, the obligations of Article 6.4 must be read in context. This context includes other
provisions of the Anti-Dumping Agreement, most notably Article 11.3.

117. Regarding the particular memoranda at issue, the United States has failed to provide any
explanation as to why these USDOC memoranda to file could not have been provided to the interested
parties in some form in advance of the release of the Section 129 Determination. Obviously, these
documents must have been produced before 16 December and the United States has not claimed
otherwise. Indeed, it is reasonable for the Panel to assume that these memoranda had been drafted,
reviewed and modified concurrently with the prep aration of the Section 129 Determination. This
point is reinforced by the referenc es in the memoranda to matters such as "inconsistencies in data".
Yet while the USDOC conducted this analysis, and dr afted its Determination, the interested parties
were unaware of the analysis th at was being performed, and were not provided with any opportunity
to comment. There was never any attempt by USDOC to reconcile such alle ged "inconsistencies in
data". The Argentine respondents were not provi ded with any opportunity, let alone a timely
opportunity, to see such information which was clea rly being used by the USDOC for purposes of the
Section 129 Determination.

ARGENTINA

Q22. The Panel notes Argentina's argument that the USDOC violated Article 6.4 by accepting
unsolicited comments from the petitioners on 30 November 2005. The Panel also notes
Argentina's acknowledgement
77 that Siderca responded to these comments in its letter dated
7 December 2005. 78 Please explain how exactly the admission of these comments violated
Article 6.4 of the Agreement.

Argentina's Answer to Question 22

118. Argentina argued that the unsolicited comment s filed by the Petitioners during the course of
the Section 129 proceeding further compounded the impact of the US breach of Article 6.4. Although
the USDOC did not issue a questionnaire to Pe titioners, the Petitioners filed a letter dated
30 November 2005 (the same response date as th e deadline for the resp onses of the Argentine
exporters who were responding to th e USDOC questionnaire that was dire cted to them) in which they
supplied data and suggested for price comparisons that would then be used to support a conclusion
regarding likely dumping. As Arge ntina explained, the Petitioners' letter concludes – without ever
seeing the cost data that was being filed the same day – that "it is almost a certitude that a comparison
of the AUVs with Siderca's costs will show that Si derca was engaging in dumping OCTG on a global
basis during the POR". 79 Furthermore, the Petitioner's letter re ferences confidential data provided to
them by the USDOC; the same confidential data that was made available to Siderca only on
28 November, two days before the Petitioners le tter in which its conclusions are stated so
emphatically.

77 First Written Submission of Argentina, para. 163.
78 This letter is found in Exhibit ARG-19.
79 Letter from Skadden, Arps, Slate, Meagher & Flom LLP to the USDOC, 2 Dec. 2005 (Public
Version) at (ARG-27).

119. The problem with the sequence of events outlined above is that it occurred without any
communication or clarification from the USDOC as to how it would use the information solicited by
Siderca, what procedures will be followed to anal yze the information, and how the parties will be
permitted to have access to and comment on the essen tial facts being used by the USDOC to make its
determination. Thus, in the midst of this uncerta inty, Siderca provided comments to demonstrate that
Petitioners' analysis was without merit and di d not establish any positive evidence that dumping
would be likely to continue or recur.
80 The Department did not advise the Parties as to what
information or what methodology it intended to follow. In this respect, the Petitioners comments and
provision of additional information only served to cr eate further uncertainties in an already uncertain
proceeding.

ARTICLE 6.5.1

Q23. With respect to your claim under article 6. 5.1 of the Agreement, please specify clearly:

(a) which confidential information you refer to,
(b) whether you argue that the USDOC failed to seek non-confidential versions of this
information or that non-confidential versions were submitted, but that they did not
conform to the requirements of Article 6.5.1.
Argentina's Answer to Question 23(a) and (b)

120. As for the confidential information to wh ich Argentina refers, it is the confidential
information that was treated as such in petitioners ' submissions during the course of the Section 129
proceeding. Because there was either no public summary or an inadequate public summary, the
Argentine respondents could not discern the nature of the arguments or evidence in support of those
arguments. That is precisely the reason why the Un ited States has violated Article 6.5.1 Indeed,
USDOC acknowledged that "Siderca and Acindar also ar gue that US Steel and IPSCO's treatment of
information as business proprietary information hindered their ability to respond effectively".81

121. With respect to Article 6.5.1, in particular, the Panel in Guatemala-Cement II found a
violation of that provision because there was no evidence demonstrating either that petitioner
provided a statement of reasons as to why summarization was not possible or that the Ministry even
requested such a statement.
82 During the Section 129 proceeding, Argentine exporter Acindar
explained that:

At the outset, Acindar is concerned that its basic right to defend itself from the
allegations being made are be ing impaired by the manner in which the information is
being developed in this proceeding. In US Steel's submission, claims for confidential
treatment appear to be so broad (either because of the Department's designation of
confidential treatment, or that by US Steel 's attorneys) that Acindar cannot even
understand the nature of the allegations. For example, on page 9, point B, US Steel's
letter states: "First, during 1999 and 2000, [ ]. ". It is difficult to
believe that no other information can be given regarding the allegedly confidential
information that follows the comma that would allow Acindar to understand the basic
nature of the allegation so that it can defend itself. US Steel provides no non-
confidential summary in sufficient detail so as to permit a reasonable understanding
of the substance of the information subm itted in confidence, nor does it provide any
justification for excluding completely this allegedly confidential information, which,

80 Letter from Siderca to USDOC, 7 December 2005 (ARG-19).
81 USDOC Section 129 Determination at 6 (ARG-16).
82 Panel Report, Guatemala - Cement II, paras. 8.207-223.

after all, relates to information that is now more than 5 – 6 years old. Therefore, the
Department must require US Steel to re-subm it its letter in a form that is consistent
with the regulations, and which will allow Acindar to at least understand the nature of
the allegation being made so that it can defend itself.83
122. There was no response by USDOC to Acindar' s request. Because USDOC did not require the
Petitioners to resubmit the public version of th e letter with an appropriate summary, Acindar
necessarily had to confine its arguments to the pub lic versions of the US industry's comments.
Petitioners' comments did not provide, in the words of Article 6.5.1, "sufficient detail to permit a
reasonable understanding of the substance of the information submitted in confidence."

123. In addition, Siderca's 14 December 2005 Letter raises a similar concern:

It is unclear why IPSCO is claiming th at the information in the brackets is
confidential. Most of the information is a narrative description of information that
Siderca provided as public information. In addition, the paragraph in IPSCO's letter
contains general arguments relating to the sufficiency of the data. There does not
seem to be any reason to claim proprietary treatment for this passage. IPSCO should
refile its letter so that Siderca officials can review the substance and provide
additional comments if necessary.
84
124. Finally, Argentina asks the Panel to review ARG-26, Siderca's 21 December 2005 letter to the
USDOC. Siderca advised the USDOC, for example, that

[B]ased on our review of the public versi ons in the public file, it appears that the
Department's bracketing of confidential in formation in the two memoranda is broad
and the information is not summarized, such that the public versions convey very
little substance. As these are the versions that Siderca and the Argentine Government
officials will be able to review, we respectf ully request that the Department revise its
bracketing and reissue the public versions.85
125. Thus, just as USDOC failed to require the Petitioners to provide proper summaries of
confidential submissions, the USDOC itself failed to do so regarding its memoranda to the file. In
order to determine whether the summaries were in "sufficient detail" to permit a "reasonable
understanding" of the confidential information, the Panel should be guided by the principle of whether
the due process objectives of this provision have been fulfille d. The Panel need not provide any
definitive ruling in the abstract as to the level of detail required under Article 6.5.1. It need only
decide that the non-confidential information released in this case fell short of the requirements of this
provision.

UNITED STATES
Q24. Please explain whether the APO system under the US law also allows interested parties
themselves, in addition to counsel for such part ies, to see all confidential information submitted
by other parties in a sunset review.

83 Letter from Acindar to USDOC, 6 December 2005 at 1 (ARG-28); see also Letter from Siderca to
USDOC, 14 December 2005 at 4 ("As a preliminary matter, IPSCO places its comments in brackets, depriving
Siderca officials of the ability to review the substance of the comments.") (ARG-29).
84 Siderca's 15 December 2005 Letter to the USDOC at 4, note 7 (ARG-29).
85 Siderca's 21 December 2005 Letter to the USDOC at 2 (ARG-26).

ARTICLE 6.8

ARGENTINA

Q25. Please respond to the US' argument that because no company-specific determination
was made for Siderca, facts available were not used for this company.

Argentina's Response to Question 25

126. Argentina responded to this argument in its Second Submission (see paragraphs 137-140).

127. Argentina would emphasize strongly, as reflected in its Second Submission, that this issue
must be decided by the substance, and not the form, of the actions of the investigating authority. If
the avoidance of the term "facts available" were conclusive, investigating authorities could shield
themselves from the disciplines of Article 6.8 and Annex II by simply not having recourse to that
specific term. This would permit widespread circumvention of these provisions.

128. It is important to separate the findings applicab le to Siderca into two parts. First, the USDOC
stated that it made no specific findings that Siderca was dumping during the sunset review period
(1995-2000). The United States indicated in its Seco nd Submission that this was not surprising given
that the company made no US shipments during this time. Second, the USDOC purported to make an
order-wide likelihood determination, which, by de finition, encompasses Siderca, the major Argentine
OCTG producer. In addition, the USDOC made findings about and drew conclusions regarding
Siderca's financial statements which clearly contributed to its order-wide determination.

129. As for the first aspect of USDOC's analysis of Siderca, the Panel should reject the argument
that the USDOC did not resort to facts availabl e with respect to Siderca because "the result of
Commerce's analysis of Siderca's estimated cost information was no company-specific finding
regarding Siderca".
86 As Argentina has explained, the US position rests on the flawed assumption that
Article 6.8 and Annex II obligations apply only to in formation that is used to support conclusions of
the investigating authority. The US position is not supported by the provisions of Article 6.8. If the
USDOC is going to reject information – informat ion that the exporter cont ends is probative and
favourable – then the authority has an obligation to comply with the requirements of Article 6.8 and
Annex II.

130. The United States argues that it "did not use other facts in lieu of the data provided by
Siderca; the United States simply made no finding w ith respect to Siderca. Thus, USDOC did not use
the "facts available" but rather declined to make any finding with respect to Siderca and used no facts
in that respect".87

131. The obligations of Article 6.8 and Annex II apply to all information, including what the
investigating authority may consider – or what an objective evaluation of that information would lead
an authority to consider – to be exculpatory inform ation. Consequently, the test is not whether the
USDOC used the magic words "facts available". Such a test would permit investigating authorities to
avoid the disciplines of Article 6.8 and Annex II by simply avoiding that term. Accordingly, although
the USDOC did not use the term "facts available" in the Section 129 Determination, this fact alone
cannot control whether Article 6.8 applies. The Panel should avoid a result that would elevate form
over substance and would permit investigating au thorities, not WTO Panels, to determine when
Article 6.8 and Annex II applied, and when it had been breached.

86 US First Submission, para. 82.
87 US Second Sumbission, para. 87.

132. In the present case, the USDOC asked both Aci ndar and Siderca for information that they did
not have.88 Siderca explained that the company was una ble to provide the information in the form
requested by USDOC because it did not retain pr oduct-specific costs from the period requested. 89
Acindar explained that it no longer produces OCTG, that it did not have the product-specific cost
information in the form requested by the Department , and that it was not required to have retained
such information under Argentine law.
90 When the companies indicated that they did not have it, the
USDOC resorted to other information, without comp lying with Article 6.8 and Annex II. This is
recourse to "facts available", whether the USDOC used that term or not.

133. There is no textual support for such a narrow reading of the Agreement to apply only to
information that supports the conclusions of the inv estigating authorities, but not to information that
contradicts or detracts from its conclusions. Article 6.8 does not apply at all unless an interested party
"refuses access to, or otherwise does not provide, necessary information within a reasonable period or
significantly impedes the investigation". There is no evidence on the reco rd of the Section 129
proceeding that these essential preconditions had b een met, and the United States has never claimed
that either company behaved in this recalcitrant manner. This fact was confirmed by the United States
in its opening oral statement during the Panel's me eting with the Parties. The USDOC Section 129
Determination itself found that Siderca "attempted to cooperate with the De partment's request for
information".
91

UNITED STATES

Q26.

(a) The Panel's understanding of the method used by the USDOC with regard to product
groupings the USDOC made for purposes of e xamining the reliability of Siderca's cost
data is that the USDOC took the weighted av erage costs of, for example, carbon casing
PE and carbon casing T&C, and compared that with the weighted average cost of alloy
casing PE and alloy casing T&C. In other words, the USDOC took as the starting point
of its product grouping for comparison the material used without taking into account
the finishing.

 Is this a correct characterization of the USDOC's methodology? Please explain by
referring to the relevant parts of the record.

ARGENTINA

(b) The Panel notes Argentina's assertion, among others, in paragraph 55 of its Oral
Submission, that the data submitted by Siderca indicated higher costs for alloy products
compared with casing products throughout the period of review, with the exception of the
year 2000. The Panel understands Argentina's argument to be that the USDOC should
have compared the costs of, for example, carbon casing PE with that of alloy casing PE
and carbon casing T&C with that of alloy casing T&C.
92

 Is the Panel's understanding correct regarding Argentina's assertion?

88 USDOC Questionnaire to Acindar, Tubhier and Siderca (31 Oct. 2005) (ARG-13).
89 Siderca's Response to Questionnaire (30 Nov. 2005) at 2 and Attachment 2 (ARG-15).
90 Acindar's Response to Questionnaire (30 Nov. 2005) (ARG-14).
91 USDOC Section 129 Determination at 8 (ARG-16); see also Argentina's First Submission, para. 182.
92 First Written Submission of Argentina, para. 79.

Argentina's Answer to Question 26 (b)

134. Yes, the Panel's understanding is correct. Because the only difference between the two
product groupings in such an alternative comparis on becomes the type of steel (i.e., alloy versus
carbon), it is logically a better indicator of whether Siderca's reported costs showed that alloy products
were more costly to produce than carbon products. Economists refer to this process of controlling all
other factors in order to isolate the factor one seeks to observe as " ceteris paribus" or "all other things
being the same".

135. Of course, Argentina repeats that this entir e line of inquiry by US DOC was of speculative
value. Any comparison at the product group level is potentially misleading because of the number of
different products – with different costs – that could be contained in the two groupings being
compared. But, of the two comparisons (carbon plain end to alloy plain end; or carbon all
 ends to
alloy all ends), the comparison that reduces the number of other differences and focuses on the type of
steel is objectively better for determining the cost effect of producing with different steel.

(c) Please explain why, in your view, it was not proper for the USDOC to rely on the same
grouping that Preston Publishing used for the subject product.

Argentina's Answer to Question 26(c)

136. Please see the response to question 26(b) above.

137. Argentina considers it important for the Panel to distinguish the two different comparison that
USDOC performed in the Section 129 determination. These are:

 Comparison Purpose
1 Alloy versus carbon production costs To determine whether Siderca's
reported costs are reliable
2 Acindar's export prices to Preston Pipe
data on US market selling prices
To determine whether Acindar was
likely dumping in the past

USDOC conducted the first comparison because it deci ded that the cost of alloy products must be
higher than the cost of carbon products; if they were not, the costs would be unreliable according to
USDOC. This was a type of "reasonableness" test that USDOC used for the purpose of testing
Siderca's cost. Argentina submits, as explaine d in response to question 26(b) above, that a
reasonableness test attempting to determine the cost of producing carbon or alloy OCTG should, if
possible, be based on a comparison of products in wh ich steel type is the only difference. It was
possible in this case; in fact, it was the way that USDOC requested the costs, and the way that Siderca
reported the cost. In contrast, the Preston Pipe groupings were more gene ral because they failed to
distinguish between end finishes. Therefore, an y difference resulting from a comparison at the more
general level used in the Preston Pipe report could be attributable to the different steel type, or to the
mix of end finishes on the OCTG in each grouping, or to some combination of the two.

138. Comparison 2 is the only comparison relating to the Preston Pipe categories. This
comparison is done for a different purpose: to determine likely dumping in the past. But USDOC
never used Siderca's data at this stage because it was deemed to suffer from "inconsistencies," partly
because of comparison 1. As explained, comparison 1 was not an appropriate comparison to
determine how steel type (alloy or carbon) affect ed the cost, because USDOC averaged the costs of
products with different end finishes. This averaging changed
 the result of comparison 1; it took
reported costs in which the alloy product was more costly than the carbon product, and changed the

result so that the carbon product (with all end finish es) became more costly than the alloy product
(with all end finishes). Without this averaging, no "inconsistency" would have arisen.

UNITED STATES

(d) The Panel notes the US' argument that the USDOC made this product grouping in
accordance with the public information available.
93 The Panel also notes that the memo
to which the United States refers in this regard, found in Exhibit ARG-18, contains a
product grouping by Preston Publishing.

 Please demonstrate, by referring to the rel evant parts of this memo, how exactly the
Preston product grouping formed the basis of the USDOC's grouping.

(e) Please explain whether the USDOC informed Siderca of the methodology that it was
considering to use for the grouping of products.

(f) Please explain why the USDOC did not use the methodology proposed by Argentina.

Q27. Please explain for what purpose the USDO C requested the cost information from the
Argentine exporters in these proceedings. Mo re specifically, please explain whether the
USDOC intended to use that information exclusiv ely for its company-specific determinations or
for its order-wide determination as well.

Q28. Please explain whether the USDOC init ially intended to make a company-specific
determination for Siderca as it did for Acindar, citing any evidence on record. In other words,
would the USDOC have made a company-speci fic determination for Siderca had that
company's cost data been found to be reliable?

Q29. The Panel notes that the USDOC's Sectio n 129 Determination reads in relevant parts:

 We disagree with Siderca's assertion that the company financial statements of
Siderca and Acindar are not relevant fo r our likelihood analysis. Financial
statements provide a good understanding of the status of the entire company, and
reflect the company's overall selling prac tices. Taken together, these data are
relevant indicators of likely future pricing trends.
94

(a) Would the United States agree that the USDOC's Section 129 Determination
demonstrates that some information pertai ning to Siderca, namely this company's
financial statements, were used by the US DOC in the context of its order-wide
determination?

(b) Were Siderca's financial statements used as facts available or as Siderca's response to
the USDOC's questionnaire?

 Please elaborate.

BOTH PARTIES

Q30. Please explain in detail whether, in your view, paragraph 3 of Annex II justified the
rejection of Siderca's cost data. In particul ar, please explain whether the cost information

93 Second Written Submission of the United States, para. 50.
94 Section 129 Determination (Exhibit ARG-16 at 9).

submitted by Siderca was verifiable within the meaning of paragraph 3. Did the USDOC take
any steps to verify such information?

Argentina's Answer to Question 30

139. Paragraph 3 of Annex II did not justify US DOC's rejection of Siderca's cost data.
Paragraph 3 provides in pertinent part as follows:

All information which is verifiable, which is appropriately submitted so that it can be
used in the investigation without undue difficulties, [and] which is supplied in a
timely fashion … should be taken into a ccount when determinations are made….
140. The cost information was verifiable within the meaning of paragraph 3. The information
provided by Siderca was verifiable, and was appropria tely submitted. Indeed, this is made crystal
clear in Siderca's letter to the USDOC, dated 14 December 2006, page 4, (ARG-29), in which Siderca
responded to petitioner IPSCO's criticism of Siderca's data, stating:

Siderca stands by the analysis and emphasizes, as explained in the 30 November
submission, that the data has been recons tructed using cost reports from the same
production lines and cost centres used to produce OCTG during the period.
Information on the cost of operating the lines during the 1995-2000 period is
available, was used by Siderca, and w ould be available for verification if the
Department so chose. The Department i ndicated in its questionnaire that Siderca
should use verifiable data, and Siderca confirms that it heeded this advice.
141. It could readily have been used by the US DOC in the Section 129 proceeding without "undue
difficulties". The Department was therefore requi red under paragraph 3 of Annex II to take such
information into account in its Section 129 determination, but it failed to do so. As the Panel clarified
in US – Steel Plate from India, a decision by an administering authority to reject information provided
by an exporter, where that decision "lacks a valid basis under paragraph 3 of Annex II of the AD
Agreement", will result in an violation of the requirements of Article 6.8 and paragraph 3 of
Annex II.
95 The Panel reasoned as follows:

The second criterion of paragraph 3 requires that the information be "appropriately
submitted so that it can be used in the investigation without undue difficulties." In our
view, "appropriately" in this context has th e sense of "suitable for, proper, fitting".
That is, the information is suitable for the use of the investigating authority in terms
of its form, is submitted to the correct authorities, etc. More difficult is the
requirement that the information can be "used without undue difficulties". "Undue" is
defined as "going beyond what is warranted or natural, excessive, disproportionate".
Thus, "undue difficulties" are difficulties be yond what is otherwise the norm in an
anti-dumping investigation. This recognizes th at difficulties in using the information
submitted in an anti-dumping investigation are not, in fact, unusual. This conclusion
is hardly surprising, given th at enterprises that become in terested parties in an anti-
dumping investigation and are asked to provide information are not likely to maintain
their internal books and records in exactly the format and with precisely the items of
information that are eventually requested in the course of an anti-dumping
investigation. Thus, it is frequently necessary for parties submitting information to
collect and organize raw data in a form that responds to the information request of the
investigating authorities. Similarly, it is frequently necessary for the investigating
authority to make adjustments of its own in order to be able to take into account

95 Panel Report, US – Steel Plate from India, WT/DS206/R, para. 7.79.

information that does not fully comply with its request. This is part of the obligation
on both sides to cooperate, recognized by the Appellate Body…. 96
142. In fact, in this case, USDOC recognized Side rca's cooperation, stating that Siderca "attempted
to cooperate with the Departme nt's request for information". 97 However, USDOC claimed to have
"significant problems with [Siderca's] allocation of costs, with respect to both OCTG production and
all tubular production" as well as "methodological discr epancies with the estimates submitted by
Siderca".98

143. The USDOC decided not to use any of Siderc a's cost information in its likelihood analysis,
stating "Given the unreliability of the cost informat ion provided by Siderca and the fact that Siderca
made no US sales of OCTG during the original sunset review period, we make no findings regarding
specific instances of likely dumping by Siderca during the original sunset review."
99 The USDOC
determined that Siderca's data was "unreliable" based on three subsidiary findings: (1) that the OCTG
cost data was "inconsistent with other product cost data for steel products" and "counter-intuitive"; 100
(2) that "Siderca's cost calculations for non-OC TG products are problematic because their costs
significantly exceed OCTG costs" 101, and (3) that "methodological discrepancies" make it "unclear
exactly how broad a product category Siderca has used in estimating its costs data".102

144. Argentina has demonstrated in its written and oral submissions to the Panel that the USDOC's
reasoning on each of these counts is seriously flawed. Equally important, however, the USDOC never
raised any of its concerns during the Section 129 proceeding. Consequently, there was no opportunity
for Siderca to address any of the Department's concerns or to clarify why the data submitted by
Siderca could be used for purposes of the USDOC's likelihood analysis. The United States did not
take any steps to verify Siderca's cost info rmation. In fact, the USDOC asked no questions
 and
sought no clarification.

Q31. The Panel notes the following part of the USDOC's Section 129 Determination:

 Although Siderca attempted to coopera te with the Department's request for
information, upon analysis of Siderca's calculations, we have identified significant
problems with its allocation of costs, with respect to both OCTG production and
all tubular production.
103

(a) Please explain your views about the relevance of this determination to the issue of
whether or not Siderca acted to the best of its ability in submitting its cost information
to the USDOC within the meaning of paragraph 5 of Annex II to the Agreement.

(b) Please explain how ideal the cost inform ation submitted by Siderca was within the
meaning of paragraph 5 of Annex II to the Agreement.

Argentina's Answer to Questions 31(a) and (b)

145. Paragraph 5 of Annex II provides:

96 Panel Report, US – Steel Plate from India, WT/DS206/R, para. 7.72.
97 USDOC Section 129 Determination at 8 (ARG-16).
98 Id. at 8-9.
99 USDOC Section 129 Determination at 9 (ARG-16).
100 USDOC Section 129 Determination at 8 (ARG-16).
101 Id.
102 Id. at 9.
103 Section 129 Determination (Exhibit ARG-16 at 8).

Even though the information provided may not be ideal in all respects, this should not
justify the authorities from disregarding it, provided the interested party has acted to
the best of its ability.
146. Argentina acted to the best of its ability in submitting the cost information. As the Panel in
Egypt – Rebar from Turkey stated, the phrase "to the best of one's ability" indicates a high level of
effort. The Panel found that "an unbiased and object ive investigating authority could have found that
[the respondent exporters] failed to provide necessar y information in the sense of Article 6.8," and
therefore Egypt did not violate Article 6.8 or Anne x II(5) in resorting to "facts available" for these
respondents.
104 Here, however, there is no basis in the r ecord of the Section 129 proceeding for the
USDOC to assert that Siderca did not act to the b est of its ability. To the contrary, the record
demonstrates that USDOC recognized that Siderc a attempted to cooperate. The USDOC simply
concluded that the information was not useable a nd did not offer Siderca any opportunity to clarify
the data or attempt to correct any of the purported problems with that data.

147. This is especially true in this case, where th e USDOC did not even attempt to ask questions or
to seek any clarification. Rather, it simply conclu ded, based on a series of flawed premises, that
Siderca's data was unusable. In this case, there is not basis under paragraph 5 of Annex II that would
"justify" USDOC "from disregarding" Siderca's cost in formation, especially in light of the fact that
Siderca "has acted to the best of its ability".

148. Regarding the quality of the cost information (within the meaning of paragraph 5 of Annex II
to the Agreement) submitted by Siderca, as Side rca has demonstrated in its written submissions and
during its opening statement to the Panel, the cost information provided by Siderca was far preferable
that the data ultimately relied on by USDOC.

149. Even if, arguendo, the information provided by Siderca was not "ideal in all respects",
paragraph 5 of Annex II makes clear that this did not justify disregarding it, provided the interested
parties acted to the best of their ability. The USDOC has not claimed that either company failed to act
to the best of its ability. Indeed, as noted above , the Department expressly recognized that Siderca
"attempted to cooperate with the Department's request for information".
105

150. Finally, Argentina has explained in this pr oceeding why, even though the cost data submitted
by Siderca may not have been "ideal", that data was still more probative for purposes of the USDOC's
likelihood analysis and was preferable to use than the alternative of rejecting this probative data and
simply speculating and relying on assumptions base d on selective reliance on Siderca's financial
statements.

Q32.

(a) In your view, was the USDOC under an obligatio n to inform Siderca of the fact that its
cost information would not be used as well as to give Siderca a chance to make comments
as to why the information had to be used by the USDOC pursuant to paragraph 6 of
Annex II? If so, was the USDOC under an obligat ion to do it prior to the issuance of its
Section 129 Determination?

(b) Did the USDOC actually inform Siderca of this fact and give Siderca a chance to make
comments? If so, when? Did Siderca know that its cost data were not going to be used by
the USDOC in its determinations?

104 See Panel Report, Egypt – Rebar from Turkey, WT/DS211, paras. 7.241-7.248.
105 USDOC Section 129 Determination at 8 (ARG-16).

Argentina's Answer to Questions 32(a) and (b)

151. Paragraph 6 of Annex II provides:

If evidence or information is not accepted, the supplying party should be informed
forthwith of the reasons therefore, and s hould have an opportunity to provide further
explanations within a reasonable period, due account being taken of the time-limits of
the investigation. If the explanations ar e considered by the authorities as not being
satisfactory, the reasons for the rejection of such evidence or information should be
given in any published determinations.
152. The obligation provided for in paragraph 6 of Annex II is clear. In Egypt – Rebar from
Turkey, the Panel concluded that "Egypt violated Articl e 6.8 and Annex II, paragraph 6, in respect of
[the respondent exporters], becau se the [investigating authority] , having identified to these
respondents the information "necessary" to verify their cost data, and having received that
information, nevertheless found that the responde nts had failed to provide "necessary information".
106
The Panel faulted the investiga ting authority because it did not "inform these companies of this
finding and did not give them an opportunity to provide further explanations."

153. Similarly, USDOC clearly was under an obligation to inform Siderca of th e fact that its cost
information would not be used by the USDOC for purposes of the Section 129 Determination. This is
especially so given that Siderca attempted to prov ide the data as it was requested by the USDOC. In
addition, if USDOC had concerns regarding th e information submitted by Siderca, USDOC was
required to provide Siderca with an opportunity to provide comments as to why the information
should not de disregarded by the USDOC. More over, USDOC was under an obligation to provide
Siderca with the opportunity to provide comments and any needed clarifications prior to the issuance
of its Section 129 Determination.

154. Finally, the record reflects that USDOC did not "actually inform Siderca of this fact" nor did
it "give Siderca a chance to make comments." The record of the Section 129 proceeding on this point
cannot be refuted. As for whether Siderca knew that its cost data were not going to be used by the
USDOC in its determinations, part of Siderca's fru stration was that it did not know what information
the USDOC was going to use or what procedures it intended to follow. In the end, Siderca had no
knowledge of the "essential facts" upon which the USDOC would rely. Nor was there any
opportunity for Siderca to address the supposed "inconsistencies" with the company's data.

ARGENTINA

Q33. The Panel notes Argentina's assertion that the USDOC violated paragraph 7 of Annex II
by failing to apply special circumspection with regard to the information it took from secondary
sources instead of the information submitted by the Argentine companies. Please explain
clearly which company Argentina refers to in this regard. Please also explain what secondary
source, in Argentina's view, was used instead of the information submitted by the Argentine
companies. Also, please explain how exactly the USDOC failed to use the most appropriate
information instead of the information submitted by the Argentine companies.

Argentina's Answer to Question 33

155. This claim relates to Acindar. The seconda ry sources consist of US Customs and Border
Protection (CBP) data and information reported in a publication known as the Preston Pipe & Tube
Report. The specific import prices of Acindar's OCTG were based on the CBP data. These prices
were considered by the USDOC to be too low wh en compared to observed selling prices in the US

106 Panel Report, Egypt – Rebar from Turkey, WT/DS211, para. 7.266.

market, as reported in a publication known as Preston Pipe & Tube Report.
107 As Argentina has
argued, there are several flaws with this appr oach for which Argentina has provided extensive
arguments.

156. First, the USDOC's comparison of pricing da ta based on a commercial publication does not
constitute an objective examination of informati on and is not positive evidence to support a WTO-
consistent determination that dum ping would be likely to continue or recur. This comparison was
inconsistent with the basic requirements of Article 2. Second, USDOC's comparison of Acindar's US
shipments to prevailing US market prices did not involve any product-specific comparison. Rather,
the USDOC compared prices for specific Acindar transactions to prices of "carbon casing, welded" as
reported by Preston Pipe & Tube Reports, without regard to the specific size of pipe, and to the type
of end finishing. As Siderca explained in its res ponses, these variables affect cost and price, and any
comparison that does not account for these differences is suspect.
108 Finally, the prices reported in
Preston Pipe & Tube Report are prices to the final customers in the United States, reported on the
basis of a specified delivery po int in the United States. The prices that USDOC obtained from
USCBP presumably are stated on a FOB port of e xport, which in the case of Acindar would be
Argentina. The record of the Section 129 proceed ing contains no indication that USDOC exercised
any care to eliminate the obvious distortion that would be implicit in any such comparison.

157. The comparison that relied on the secondar y sources relied on by USDOC as supporting its
determination of "likely" dumping does not even r esemble the notion of "dumping" under Article 2.
The record does not reveal any attempt by USDOC to ensure that the prices it reviewed related to the
same products within the specific categories, or that basic differences in points of sale and
transportation were the same. The USDOC neve r even asked Acindar any questions about the
observed prices, either of its exports or the average US prices of the OCTG product groupings.

158. There is no indication whatsoever that th e USDOC acted with "special circumspection"
within the meaning of paragraph 7 of Annex II. In this regard, the Appellate Body adopted the views
of the Panel in Mexico – Rice, where it said

when culling necessary information from secondary sources, the agency should
ascertain for itself the reliability and accuracy of such information by checking it,
where practicable, against information cont ained in other independent sources at its
disposal, including material submitted by in terested parties. Such an active approach
is compelled by the obligation to treat data obtained from secondary sources "with
special circumspection".
109
159. There is nothing in the Section 129 Determin ation demonstrating that the USDOC took "such
an active approach" or "check[ed] the information fr om other independent sources at [its] disposal".
USDOC never even asked Acindar to explain the gene ral reference in its 2000 financial statement.
Instead, it assumed that it must be consistent with the notion that Acindar was likely to dump OCTG
in the US in the event of expiry of the measure.

160. Finally, as for what information might have been appropriate, the USDOC might reasonably
have asked Acindar to provide information about th e actual OCTG products that Acindar sold to the
United States, the prices for those products, the terms of sale, and it could have developed information
that could have been used for a more appropria te comparison to determine whether Acindar was
"dumping" during the sunset period as defined by the Anti-Dumping Agreement.

107 USDOC Section 129 Determination at 7 (ARG-16).
108 See Siderca's Response to Questionnaire (30 Nov. 2005) at 4 (ARG-15) ("While Siderca has
reported the cost data for the product categories defined by the Department, Siderca would like to stress that the
data for such broad product groupings is of limited value from a cost and commercial point of view.").
109 Appellate Body Report, Mexico – Rice, paras. 288-289 (footnote omitted).

ANNEX 1*

Harmonized Tariff Schedule of the United States (2000)**
Annotated for Statistical Reporting Purposes

CHAPTER 73

ARTICLES OF IRON OR STEEL

XV
73-1

Notes

1. In this chapter the expression "cast iron " applies to products obtained by casting in which iron
predominates by weight over each of the other elements and which do not comply with the chemical
composition of steel as defined in Note 1(d) to chapter 72.

2. In this chapter the word "wire " means hot- or cold-formed products of any cross-sectional shape, of which
no cross-sectional dimension exceeds 16 mm.

Additional U.S. Notes

1. For the purposes of heading 7304 or 7306, the ra te of duty "Free (C)" appearing in the "Special"
subcolumn applies only to tubes and pipes with attached fittings, suitable for conducting gases or liquids.

2. For the purposes of subheading 7307.19.30, the expression "ductile fittings " refers to fittings which contain
over 2.5 percent carbon and over 0.02 percent of magnesium or of magnesium and cerium, by weight.

 * Argentina submitted to the Panel a scanned version of this Annex. For technical reasons concerning
the reproduction of the report, however, the Annex has been reproduced and then incorporated into the report.
Certain manual additions as well as emphasis in the form of circling found in the original version of the Annex
submitted by Argentina have been identified through footnotes.
 ** The year "(2000)" manually circled in the original version submitted by Argentina.

Harmonized Tariff Schedule of the United States (2000)
Annotated for Statistical Reporting Purposes

XV
73-15
Rates of Duty
1 Heading/
subheading
Stat.
Suf
fix
Article Description
Unit
of
Quantity General Special 2
7306

Other tubes, pipes and hollow profiles (for example, open
seamed or welded, riveted or similarly closed), of iron or
steel:

7306.10 Line pipe of a kind used for oil or gas pipelines:
7306.10.10

 Of iron or nonalloy steel .. .......................... ............. .. 0.8% Free (A+,CA,E,IL,
 J)
0.5% (MX)
5.5%
 10 With an outside diameter not exceeding
 114.3 mm ....... ........................................... kg
 50 With an outside diameter exceeding
 114.3 mm........... ........................................ kg
7306.10.50 Of alloy steel ............................................................ .... ........... 2% Free (A+,CA,E,IL,
 J)
1.4% (MX)
10%
 10 With an outside diameter not exceeding
 114.3 mm........ ........................................... kg
 50 With an outside diameter not exceeding
 114.3 mm........ ........................................... kg
7306.20

7306.20.10
 Casting and tubing of a kind used in drilling for oil or gas:
 Casing:*
 Of iron or nonalloy steel:
 Threaded or coupled.... ..................................

2.4%

Free (A+,CA,E,IL,
 J)
1.8% (MX)
20%
 30 Imported with coupling.............................. kg
 90 Other........................................................... kg
7306.20.20 00 Other........... ....................................................... kg........... 0. 2% Free (A+,CA,E,IL,
 J)
0.1% (MX)
1%
7306.20.30 00
 Of alloy steel:
 Threaded or coupled ......................................

kg...........

2.5%

Free (A+,CA,E,IL,
 J)
1.8% (MX)

28%
7306.20.40 00 Other........ ...................................................... kg........... 1. 3% Free (A+,CA,E,IL,
 J)
0.9% (MX)
8.5%

7306.20.60
 Tubing:**
 Of iron or nonalloy steel ...................................

0.8%

Free (A+,CA,E,IL,
 J)
0.5% (MX)

5.5%
 10 Imported with coupling................................. kg
 50 Other.............................................................. kg
7306.20.80 Of alloy st eel..................................................... .......... ..... 2% Free (A+,CA,E,IL,
 J)
1.4% (MX)
10%
 10 Imported with coupling................................. kg
 50 Other.............................................................. kg

 * The word "Casing" manually circled in th e original version submitted by Argentina.
 ** The word "Tubing" manually circled in th e original version submitted by Argentina.

1998*

O&f1y3x

CHAPTER 73

ARTICLES OF IRON OR STEEL

XV
73-1

Notes

1. In this chapter the expression "cast iron " applies to products obtained by casting in which iron
predominates by weight over each of the other elements and which do not comply with the chemical
composition of steel as defined in Note 1(d) to chapter 72.

2. In this chapter the word "wire " means hot- or cold-formed products of any cross-sectional shape, of which
no cross-sectional dimension exceeds 16 mm.

Additional U.S. Notes

1. For the purposes of heading 7304 or 7306, the ra te of duty "Free (C)" appearing in the "Special"
subcolumn applies only to tubes and pipes with attached fittings, suitable for conducting gases or liquids.

2. For the purposes of subheading 7307.19.30, the expression "ductile fittings " refers to fittings which contain
over 2.5 percent carbon and over 0.02 percent of magnesium or of magnesium and cerium, by weight.

 * The indication of year manually added in the original version submitted by Argentina.

O&f2y3x
XV
73-17
7306 (con.)

7306.20

7306.20.10
Other tubes, pipes and hollow profiles (for example, open
seamed or welded, riveted or similarly closed), of iron or
steel (con.):
 Casing and tubing of a kind used in drilling for oil or
 gas:
 Casing:*
 Of iron or nonalloy steel:
 Threaded or coupled ...................................... ............... 3.6%
Free (A+,CA,E,IL,
 J)
3% (MX) 20%
 30 Imported with coupling.............................. kg
 90 Other........................................................... kg
7306.20.20 00 Other........... ....................................................... kg........... 0. 3% Free (A+,CA,E,IL,
 J)
0.2% (MX)
1%

7306.20.30

00
 Of alloy steel:
 Threaded or coupled ...................................... kg........... 3.7%

Free (A+,CA,E,IL,
 J)
3.1% (MX)

28%
7306.20.40 00 Other........... ................................................... kg ........... 2%

Free (A+,CA,E,IL,
 J)
1.6% (MX)

8.5%

7306.20.60
 Tubing:**
 Of iron or nonalloy steel ...................................

1.1%

Free (A+,CA,E,IL,
 J)
0.9% (MX)

5.5%
 10 Imported with coupling................................. kg
 50 Other.............................................................. kg
7306.20.80 Of alloy steel ..................................................... .......... ..... 2.9% Free (A+,CA,E,IL,
 J)
2.4% (MX)
10%
 10 Imported with coupling................................. kg
 50 Other.............................................................. kg
7306.30 Other, welded, or circular cross section, of iron or
nonalloy steel:

7306.30.10 00 Having a wall thickness of less than
 1.65 mm.......................................................................

kg...........

4.8%

Free (A+,C 1 /,CA,
 E,IL,J)
4% (MX)

25%
 Having a wall thickness of 1.65 mm or
 more:

7306.30.30 00 Tapered steel pipes and tubes principally used
 as parts of illuminating articles ........................ kg........... 4.6%
Free (A+,CA,E,IL,J,
 MX) 45%
7306.30.50 Other........... ........................................................... ....... ........ 1.1% Free (A+,C 1 /,CA,
 E,IL,J)
0.9% (MX)
5.5%
 10 Suitable for use in boilers, superheaters, heat
exchangers, condensers, refining furnaces and
feedwater heaters, whether or not cold
drawn............................................................... kg

 15 Other, cold-drawn............................................ kg
 20 Other, cold-rolled (cold-reduced) with a wall
thickness not exceeding 2.54 mm ................... kg

1999*

O&fly3x

CHAPTER 73

ARTICLES OF IRON OR STEEL

XV
73-1
Notes

1. In this chapter the expression "cast iron " applies to products obtained by casting in which iron
predominates by weight over each of the other elements and which do not comply with the chemical
composition of steel as defined in Note 1(d) to chapter 72.

2. In this chapter the word "wire
" means hot- or cold-formed products of any cross-sectional shape, of which
no cross-sectional dimension exceeds 16 mm.

Additional U.S. Notes

1. For the purposes of heading 7304 or 7306, the ra te of duty "Free (C)" appearing in the "Special"
subcolumn applies only to tubes and pipes with attached fittings, suitable for conducting gases or liquids.

2. For the purposes of subheading 7307.19.30, the expression "ductile fittings " refers to fittings which contain
over 2.5 percent carbon and over 0.02 percent of magnesium or of magnesium and cerium, by weight.

 * The indication of year manually added in the original version submitted by Argentina.

O&f2y3x
XV
73-17

7306 (con.)

7306.20

7306.20.10
Other tubes, pipes and hollow profiles (for example, open
seamed or welded, riveted or similarly closed), of iron or
steel (con.):
 Casing and tubing of a kind used in drilling for oil or
 gas:
 Casing:*
 Of iron or nonalloy steel:
 Threaded or coupled.... .................................. ............... 3%
Free (A+,CA,E,IL,
 J)
2.4% (MX) 20%
 30 Imported with coupling.............................. kg
 90 Other........................................................... kg
7306.20.20 00 Other........... ....................................................... kg........... 0. 2% Free (A+,CA,E,IL,
 J)
0.2% (MX) (s) 1/
1%

7306.20.30

00
 Of alloy steel:
 Threaded or coupled ...................................... kg........... 3.1%

Free (A+,CA,E,IL,
 J)
2.4% (MX)

28%
7306.20.40 00 Other........... ..................................................... kg........... 1.6%

Free (A+,CA,E,IL,
 J)
1.3% (MX)

8.5%

7306.20.60
 Tubing:**
 Of iron or nonalloy steel ...................................

1%

Free (A+,CA,E,IL,
 J)
0.7% (MX)

5.5%
 10 Imported with coupling................................. kg
 50 Other.............................................................. kg
7306.20.80 Of alloy steel ..................................................... .......... ..... 2.4% Free (A+,CA,E,IL,
 J)
1.9% (MX)
10%
 10 Imported with coupling................................. kg
 50 Other.............................................................. kg
7306.30 Other, welded, of circular cross section, of iron or
nonalloy steel:

7306.30.10 00 Having a wall thickness of less than
 1.65 mm.......................................................................

kg...........

4%

Free (A+,C 2 /,CA,
 E,IL,J)
3.2% (MX)

25%
 Having a wall thickness of 1.65 mm or
 more:

7306.30.30 00 Tapered steel pipes and tubes principally used
 as parts of illuminating articles ........................ kg........... 3.8%
Free (A,CA,E,IL,J,
 MX) 45%
7306.30.50 Other........... ........................................................... ....... ........ 1% Free (A+,C, 2 /, CA,
 E,IL,J)
0.7% (MX)
5.5%
 10 Suitable for use in boilers, superheaters, heat
exchangers, condensers, refining furnaces and
feedwater heaters, whether or not cold
drawn............................................................... kg

 15 Other, cold-drawn............................................ kg
 20 Other, cold-rolled (cold-reduced) with a wall
thickness not exceeding 2.54 mm ................... kg

ANNEX E-2

ANSWERS OF THE UNITED STATES TO
QUESTIONS OF THE PANEL

Q1. The Panel notes that Argentina argues, and the United States does not contest, that the
US law requires the USDOC to make its ultimate sun set determinations on an order-wide basis.
Please explain whether this is the case and, if so, cite the relevant provisions of the US law
(including regulations and/or policy provisions) which require the US investigating authorities
to make their sunset determinations on an order-wide basis and provide copies thereof.

1. Section 751(c)(1)(A) of the Tariff Act provid es that Commerce shall c onduct a sunset review
of an anti-dumping duty order
 five years after publication of the anti-dumping duty order. 1 T h e
Statement of Administrative Action ("SAA") – an authoritative interpretive tool for the statute –
confirms that section 751(c)(1) requires Commerce to make a sunset determination on an order-wide,
rather than a company-specific, basis.2

Q3 through 8

2. Questions 3 through 8 relate to "Waiver Provi sions". The following discussion of the general
statutory and regulatory scheme regarding waivers, as well as US actions taken to address the DSB
rulings on this issue, provides background for the responses to these questions.

3. Section 751(c)(4) of the Tariff Act permits a respondent interested party to waive its
participation in a Commerce sunset review.

4. Subparagraph (A) of section 751(c)(4) – "[i]n general" – permits a party to "elect not to
participate" in a Commerce sunset review, without pr ejudice to the party's right to participate in the
injury-related sunset review conducted by the US In ternational Trade Commission. By using the verb
"elect", the statute contemplates that a party will "el ect not to participate" by taking affirmative action
to signal that it has voluntarily cho sen to waive its participation, i.e., by submitting a waiver to
Commerce.

5. The "Effect of Waiver" is set forth in subparagraph (B) of section 751(c)(4).
Subparagraph (B) provides that, where an interested party "waives its participation pursuant to this
paragraph [ i.e., paragraph (4) of section 751(c)]", Commer ce shall conclude that revocation of the
order would be likely to lead to continuation or r ecurrence of dumping "with respect to that interested
party".

6. Thus, the only action required by section 751(c)(4 ) of the Tariff Act is that Commerce make
an affirmative company-specific likelihood finding as a consequence of a par ty choosing to submit a
statement of waiver in a sunset review. The Statement of Administrative Action – an authoritative

1 19 USC. 1675(c)(1) (Exhibit ARG-33).
2 SAA at 879 ("Commerce and the [US International Trade] Commission will make their sunset
determinations on an order-wide, rather than a company-specific basis.") (Exhibit US-12). The SAA is a type of
legislative history. In the United States, legislative hi story is often considered fo r purposes of ascertaining the
meaning of a statute. The function of the SAA is set forth in the SAA itself. See US Answers to First Set of
Panel Questions (8 January 2004), paras. 97-98, United States – Sunset Reviews of Anti-Dumping Measures on
Oil Country Tubular Goods From Argentina (WT/DS268).

interpretive tool for the statute – confirms this plain reading of the statutory provisions. Specifically,
the SAA states,

To reduce the burden on all parties involve d, new section 751(c)(4) permits foreign
interested parties ... to waive their part icipation in a Commerce sunset review. If
Commerce receives such a waiver , Commerce will conclude that revocation ... would
be likely to lead to continuation or recurrence of dumping ... with respect to the
submitter.
3

7. In other words, the statute permits parties to avoid incurring the time and expense of
participating in the Commerce side of a sunset revi ew when they wish only to contest the likelihood
of continuation or recurrence of injury before th e US International Trade Commission. A party may
do so by submitting a waiver statement to Commerce.

8. Commerce implemented the statutory waiver provision in its 1998 Sunset Regulations by
setting forth the timing and contents of a statement of waiver.
4 The Panel referred to this category of
waiver as "affirmative waiver."5 At the same time, Commerce indicated that it also would treat failure
to file a complete substantive response to the sunset review initiation notice as a waiver of
participation.6 As Commerce clarified in the Preamble to its 1998 Sunset Regulations, "failure to file
a complete substantive response ... also will be treated as a waiver of participation". 7 The Panel
referred to this category of waiver as "deemed waiv er" and correctly found that the deemed waiver
category was "create[d]" by section 351.218(d)(2)(iii) of Commerce's 1998 Sunset Regulations.8

9. As discussed in the US submissions, to address the adverse findings of the DSB concerning
both categories of waiver, Commerce amended its sun set regulations in October 2005 to eliminate the
possibility that Commerce's orde r-wide likelihood determinations would be based on assumptions
about likelihood. Specifically, Commerce revised th e so-called "affirmative waiver" provisions so
that a party electing not to participate in the Comme rce sunset review would include in its waiver a
statement that it would be likely to dump if the order were revoked.
9 Commerce also removed
section 351.218(d)(2)(iii) from its s unset regulations, thus eliminati ng the provision that created the
so-called "deemed waiver" category. 10 As explained in the Preamble to the amended sunset
regulations, Commerce "will no longer make company-specific likelihood findings for companies that
fail to file a statement of waiver and fail to file a substantive response to the notice of initiation".11

Q3. The Panel notes that Section 751 (c)(4)(B) of the Tariff Act of 1930 requires the USDOC
to find likelihood with respect to companies which waive their right to participate. The Panel
also notes that Section 218(d)(2)(ii) of the Regula tions stipulate that "every statement of waiver
must include a statement indicating that the re spondent interested party waives participation in
the sunset review before the Department; a statement that the respondent interested party is
likely to dump".

3 SAA at 881 (Exhibit US-12).
4 See 19 C.F.R. 351.218(d)(2)(i) and (ii) (1998) (Exhibit US-13). Subparagraph (i) sets forth the timing
for filing a statement of waiver, and subparagraph (ii) indicates the contents of a statement of waiver.
5 Panel Report, United States – Sunset Reviews of Anti-Dumping Measures on Oil Country Tubular
Goods From Argentina, WT/DS268/R, para. 7.83 ("Panel Report").
6 19 C.F.R. 351.218(d)(2)(iii) (1998) (Exhibit US-13).
7 Preamble to Commerce 1998 Sunset Regulations, 63 FR at 13518 (emphasis added) (Exhibit US-14).
8 Panel Report, paras. 7.83 and 7.85.
9 See 19 C.F.R. 351.218(d)(2)(ii) (2005), 2005 Sunset Regulations, 70 FR at 62064 (Exhibit ARG-12).
10 See 2005 Sunset Regulations, 70 FR at 62064 ("Section 351.218 is amended by ... removing and
reserving paragraph (d)(2)(iii) ....") (Exhibit ARG-12).
11 Preamble to 2005 Sunset Regulations, 70 FR at 62062 (Exhibit ARG-12).

 Please explain, in light of the above-refe renced provisions of the US law and its other
provisions that may also be relevant, what the US law stipulates with respect to respondents
that do not respond at all to the USDOC's que stionnaire and those that provide incomplete
responses. Specifically, please explain whether and how the US law also directs the USDOC to
find likelihood for these exporters.

10. United States law does not direct Commerce to find likelihood with respect to a respondent
that does not respond at all to a Commerce questionnair e or that provides an incomplete response to a
Commerce questionnaire. As discussed above, an d as the original Panel found, Commerce's 1998
Sunset Regulations provided for the treatment of fail ure to file a complete substantive response to the
sunset review initiation notice as a waiver of participation. Such treatment, i.e., deemed waiver, was
not required by the statute, but rather was created by section 351.218(d)(2)(iii) of the regulations.
Commerce removed section 351.218(d)(2)(iii) from its sunset regulations, thereby eliminating the
concept and consequences of a deemed waiver.
12

11. Thus, US law does not stipulate any specific finding with respect to a respondent that does
not respond at all to a Commerce questionnaire or that provides an incomplete response to a
Commerce questionnaire. Rather, where a respondent does not respond to a questionnaire or provides
an incomplete response, section 776 of the Tariff Act provides for Commerce's use of "facts otherwise
available" in reaching its determination,
13 subject to certain conditions. 14 Commerce regulations
concerning use of facts available in a sunset review also provide for reliance on, e.g ., evidence of
dumping from prior Commerce determinations and in formation contained in parties' substantive
responses to the sunset notice of initiation. 15 That is the approach identified by the original Panel in
explaining the options available to an investigating au thority when an exporter fails to participate in a
proceeding.16 As Commerce explained in its amended s unset regulations, in response to commenters
who noted that the regulations no longer specify how Commerce will address the situation where a
respondent interested party does not participate in a sunset review,

As a general matter, the Department will make its order-wide, likelihood
determination on the basis of the facts and in formation available on the record of the
sunset review which may include, where appropriate, use of facts available as
provided for in the statute and regulations.
17

12. As previously stated, US law does not require Commerce to make company-specific
likelihood findings with respect to a respondent inter ested party that fails to participate in the sunset
review. Commerce's sunset determinations supports this fact. Since the 2005 Sunset Regulations
went into effect, Commerce has conducted and comple ted multiple sunset review proceedings. In
several of the sunset proceedings, there was no respondent interested party participation. Under these
circumstances, and as is evident from analy ses in the decision memoranda, Commerce based its
likelihood determination on the facts and informati on on the record of the sunset review; Commerce
did not find that a company had elected to waive part icipation or make a company-specific likelihood
determination with respect to the companies that failed to participate.18

12 See 2005 Sunset Regulations, 70 FR at 62064 ("Section 351.218 is amended by ... removing and
reserving paragraph (d)(2)(iii) ....") (Exhibit ARG-12).
13 19 USC. 1677e (Exhibit US-15).
14 See 19 USC. 1677m(e) ("Use of Certain Information") ( e.g., the information is submitted by the
established deadline, and the information can be verified) (Exhibit US-16).
15 See 19 C.F.R. 351.308(f) (1998) (Exhibit US-17).
16 Panel Report, para. 7.95.
17 Preamble to 2005 Sunset Regulations, 70 FR at 62063 (Exhibit ARG-12) .
18 See, e.g. , Final Results of the Expedited Sunset Review of the Anti-Dumping Duty Order on Fresh
Garlic from the People's Republic of China, Issues and Decision Memorandum (1 June 2006) (Exhibit US-18).

Q4.

(a) Please explain generally the relevance of the company-specific finding of likelihood under
Section 751 (c)(4)(B) to the USDOC's order-wide determination.

13. As discussed in response to Question 1, un der US law Commerce is required to make its
ultimate sunset determination on an order-wide b asis. In making its order-wide determination,
Commerce must consider all information and argument on the record of the sunset proceeding. Thus,
while Commerce would consider a company-speci fic likelihood finding in making its order-wide
likelihood determination, the rele vance of such a company-specific finding to the ultimate likelihood
determination always would depend on the facts on th e administrative record in that sunset review.
Although Argentina has failed to provide any supp ort for its vague assertion that probative evidence
contradicting an exporter's admission of likel y dumping could even exist, Commerce would
nevertheless take such as-yet-hypothetical info rmation into account when making its order-wide
likelihood determination. In such a situation, the weight give n to a company-specific finding would
be adjusted accordingly.

(b) Given the mandate of Section 751 (c)(4)(B) of the Tariff Act to find likelihood for
companies that waive participation, would it be accurate to say that the USDOC has to
find likelihood in its ultimate order-wide dete rmination in every sunset review where the
USDOC finds likelihood for individual companies that waive participation?

14. No. The only action mandated by section 751(c )(4) of the Tariff Act is that Commerce make
an affirmative company-specific likelihood finding as a consequence of a party submitting a statement
of waiver in a sunset review. As discussed above, the relevance of a company-specific finding always
would depend on the facts on the administrative record in that sunset review. Commerce is not
required to find likelihood in its ultimate order-wide determina tion just because a company elects not
to participate in the sunset review.

Q5. Please explain whether there has been any sunset review where the USDOC found
likelihood for individual exporters by virtue of Section 751 (c)(4)(B) of the Tariff Act and found
no likelihood on an order-wide basis. If so, please provide a copy of the USDOC's final
determination in such reviews.

15. Commerce amended its sunset regulati ons in October 2005 to address the DSB
recommendations and rulings concerning the "wai ver provisions." As discussed above, Commerce
eliminated the so-called "deemed waiver" provision and revised the so-called "affirmative waiver"
provisions so that a party electing not to particip ate in the Commerce sunset review would include a
statement that it would be likely to dump if the or der were revoked. The amended regulations were
effective for sunset reviews initiated on or afte r 31 October 2005. Commerce has made no company-
specific likelihood findings pursuant to section 751(c )(4)(B) of the Tariff Act in sunset reviews
initiated on or after 31 October 2005, because no company has filed a waiver statement in any of these
reviews. In other words, the condition precedent fo r application of section 751(c)(4)(B) of the Tariff
Act has not been implicated in any sunset re views conducted since Commerce amended its sunset
regulations in October 2005.

Q6. The Panel notes that Section 751(c)(4) of the Tariff Act of 1930 provides, in relevant part:
(4) Waiver of participation by certain interested parties

(A) In general
 An interested party described in section 1677(9)(A) or (B) of this
title may elect not to participate in a review conducted by the
administering authority under this subsection and to participate

only in the review conducted by the Commission under this
subsection.
(B) Effect of waiver
 In a review in which an interested party waives its participation
pursuant to this paragraph, the administering authority shall
conclude that revocation of th e order or termination of the
investigation would be likely to lead to continuation or
recurrence of dumping or a countervailable subsidy (as the case
may be) with respect to that interested party. (emphasis added)

(a) Please explain whether electing not to participate within the meaning of
subparagraph (A) constitutes a waiver within the meaning of subparagraph B.

16. Yes, electing not to participate within th e meaning of subparagraph (A) does constitute a
waiver within the meaning of subparagraph (B). Sections 351.218(d)(2)(i) and (ii) of Commerce's
2005 Sunset Regulations prescribe the timing and conten ts of the waiver statement to be filed by a
party electing not to participate in a sunset review.

(b) How does an exporter elect not to particip ate within the meaning of subparagraph A?
Does remaining silent, i.e. not submitting any response to the USDOC's questionnaire,
constitute an election not to participate with in the meaning of subparagraph (A)? If so,
does this constitute a waiver for the purposes of subparagraph B?

17. As discussed above, section 751(c)(4)(A) of the Tariff Act contemplates that a party will
"elect not to participate" by taking affirmativ e action to signal its waiver of participation, i.e., by
submitting a waiver to Commerce. The Statemen t of Administrative Action – an authoritative
interpretive tool for the statute – c onfirms this reading of the statute.
19 Commerce implemented the
statutory waiver provision in its 1998 Sunset Regulations by specifying the timing and contents of a
waiver statement. In October 2005, Commerce revised its regulations so that a party electing not to
participate in the Commerce sunset review would in clude in its waiver a statement that it would be
likely to dump if the order were revoked. Commerce's revised sunset regulations, at
19 C.F.R. 351.218(d)(2)(i) and (ii), prescribe how an exporter may elect not to participate within the
meaning of subparagraph (A) of section 751(c)(4) of the Tariff Act.

18. Remaining silent, i.e., not submitting any response, does not constitute an election not to
participate within the meaning of subparagraph (A ) and does not constitute a waiver for purposes of
subparagraph (B). As discussed above, in October 2005 Commerce removed section
351.218(d)(2)(iii) from its sunset regulations, thus e liminating the provision that created the so-called
"deemed waiver" category.
20 As a result, Commerce "will no longer make company-specific
likelihood findings for companies that fail to file a statement of waiver and fail to file a substantive
response to the notice of initiation." 21 As discussed above, since the 2005 Sunset Regulations went
into effect, Commerce has conducted and completed mu ltiple sunset review proceedings. In several
of the sunset proceedings, respondent interested pa rties failed to file a substantive response to the
notice of initiation. Under these circumstances, Commerce based its likelihood determination on the
facts and information on the record of the sunset review; Commerce did not conclude that these

19 SAA at 881 (" If Commerce receives such a waiver , Commerce will conclude that revocation ...
would be likely to lead to continuation or recurrence of dumping ... with respect to the submitter") (emphasis
added) (Exhibit US-12).
20 See 2005 Sunset Regulations, 70 FR at 62064 ("Section 351.218 is amended by ... removing and
reserving paragraph (d)(2)(iii) ....") (Exhibit ARG-12) .
21 Preamble to 2005 Sunset Regulations, 70 FR at 62062 (Exhibit ARG-12) .

parties had elected to waive participation, nor did Commerce make a company-specific likelihood
determination with respect to the companies that failed to participate.
22

Q7. Under what circumstances would a signed waiver statement constitute a sufficient
evidentiary basis for an affirmative likelihood determination? Would your response depend on
the circumstances of a given sunset review? For example, would your response differ in relation
to: (i) a review in which the only exporter subm its a signed waiver statement; (ii) a review in
which, of the 20 exporters involved, 10 submit a signed waiver statement and 10 participate
cooperatively; (iii) a review in which, of the 20 exporters involved, 1 submits a signed waiver
statement and 19 remain silent? How would the company-specific conclusions of likelihood
with respect to exporters that waive their right to participate (by signing a statement of waiver)
in these scenarios be reflected in an ultimate order-wide determination?

19. Commerce is required to make its ultimate sun set determination on an order-wide basis. In
making its order-wide determination, Commerce must consider all information and argument on the
record of the sunset proceeding. Commerce would consider a company's waiver statement, including
the company's statement that it would be likely to dump if the order were revoked, in making its
order-wide likelihood determination. However, whether such a statement could constitute a sufficient
evidentiary basis for an affirmative likelihood dete rmination would depend on the specific facts and
circumstances of a given sunset review. Howeve r, as discussed above in response to Question 5,
Commerce has made no company-specific likelihood findings in sunset reviews subject to the
amended sunset regulations because no company has f iled a waiver statement in any of these reviews.
Because no company has filed a waiver statemen t, there are no examples of how Commerce has
reflected a company-specific likelihood determinati on(s) in the ultimate order-wide determination,
and the question is a purely hypothetical one. The fact that no company has filed a waiver statement
is not surprising. Waiver statements were rare in sunset reviews under the 1998 Sunset Regulations.
Waiver statements in sunset reviews under the 2005 S unset Regulations likely also will continue to
be, as Argentina itself concedes, "rarely ... forthcoming".
23

20. The facts the Panel has identified in its qu estion would form part of the record and by
regulation would be taken into account in making th e order-wide determination. The probative value
of any particular fact would depend on the other facts on the record.

Q8. The Panel notes that Section 751 (c)(4) of the Tariff Act does not define the term
"waiver". The Panel also notes that Section 351.218(2)(ii) of the Regulations states that a
statement of waiver "must include a statement indicating that the respondent is likely to
dump."

Can this, in your view, be interpreted to mean that the Regulations nullify, or limit the
scope of, the Statute in so far as the Statute refers to waiver.

21. The regulations neither nullify nor limit the scope of section 751(c)(4) of the Tariff Act,
rather, as provided under US administrative law, the regulations implement the statute and help define
the conditions under which a party will "elect not to participate."

22. As discussed above, subparagraph (A) of secti on 751(c)(4) – "[i]n general" – permits a party
to "elect not to participate" in a Commerce sunset review without prejudice to the party's right to
participate in the injury-related sunset review c onducted by the US International Trade Commission.
By using the verb "elect", the statute contemplates th at a party will "elect not to participate" by taking

22 See, e.g., See, e.g., Final Results of the Expedited Sunset Review of the Anti-Dumping Duty Order on
Fresh Garlic from the People's Republic of China, Issues and Decision Memorandum (1 June 2006)
(Exhibit US-18).

affirmative action to signal its waiver of participation, i.e., by submitting a waiver to Commerce. The
Statement of Administrative Action – an authoritative interpretive tool for the statute – confirms this
reading of the statute. Specifically, the SAA states,

To reduce the burden on all parties involve d, new section 751(c)(4) permits foreign
interested parties ... to waive their part icipation in a Commerce sunset review. If
Commerce receives such a waiver , Commerce will conclude that revocation ... would
be likely to lead to continuation or recurrence of dumping ... with respect to the
submitter.
24

23. Sections 351.218(d)(2)(i) and (ii) of Commerce' s sunset regulations implement the statutory
waiver provision by prescribing how an exporter may elect not to participate, i.e., waive participation,
in a sunset review.

24. Prior to the October 2005 amendments to th e sunset regulations, Commerce also treated
failure to file a complete substantive response to the sunset review initiation notice as a waiver of
participation. As the Panel correctly found, such "deemed waivers" were "create[d]" by
section 351.218(d)(2)(iii) of Commerce's 1998 Sunset Regulations.
25 There is no dispute that the
regulatory provision pertaining to the deemed waiver category has been removed from Commerce's
sunset regulations. The scope of the waiver provisi ons in the regulations is now simply coterminous
with the statute.

Q10.

(a) The Panel notes that the USDOC asked the Argentine exporters to submit their
consolidated and unconsolidated financial statements for the 1996-2000 period, as well
as to provide information relating to their costs and the volume of their shipments to the
United States in the period of review.

Please explain for what purpose the USDOC so ught the mentioned information. More
specifically, please explain whether the USDOC in tended to, and the extent to which it did,
determine whether these exporters actually dum ped in the period of review, and how this
relates to the obligations under Articles 11.3 and/or 2.1 of the Agreement. Please explain how
exactly the USDOC intended to, and the extent to which it did, base its determination regarding
the existence of dumping on the costs of the exporters, citing any record evidence supporting
your response.

25. Bearing in mind the obligation to make a determination as to whether dumping was likely to
continue or recur if the order were revoked, an d bearing in mind that there were no administrative
reviews of Argentine companies during the sunset period of review (and that Siderca had ceased
shipping), Commerce sought information that would permit it to make a dete rmination as to whether
dumping would likely continue or recur if the or der were revoked, includi ng evaluating the overall
financial health of the Argentine OCTG industry. Aware that Acindar, the only exporter, had no
home market or third country sales, Commerce drafte d the questionnaire with the intention of asking
questions that respondents could actually answer, a nd therefore requested the product-specific cost
data to provide an estimate of the normal value.
26 Had the Argentine producers been able to report
their actual product-specific cost information, it could have been verified by tying the costs back to

24 SAA at 881 (Exhibit US-12).
25 Panel Report, paras. 7.83 and 7.85.
26 Counsel for US Steel noted that respondents would not have a viable home market. (Letter from
Skadden, Arps, Exhibit ARG-27, pp. 5, 9.) In response, Siderca did not assert that its home market was viable
(Exhibit ARG-19, p. 7); Acindar did not file any comments in response to petitioners' letter.

the financial statements. Commerce did not seek to perform a calculation of a margin of dumping,
nor was it obliged to perform such a calculation.

26. As the United States has noted, Article 11.3 do es not require that a likelihood determination
be based on a determination of the existence of dumping. Nor did Commerce seek to establish the
existence of dumping. Instead, Commerce exam ined the available evidence on the exporters'
behaviour in order to ascertain whether dumping was likely to continue or recur if the order were
revoked. To do so, Commerce sought to compare Ac indar's product-specific costs with the importer
data providing the prices of its US sales. Howeve r, none of the Argentine producers maintained their
product-specific cost data. Therefore, Commer ce could not examine these costs to ascertain the
companies' past behaviour. Acindar provided its fi nancial statements as requested, but provided no
other information that could assist Commerce in making its determination for the period 1995-2000.

27. Therefore, Commerce used the other informa tion available on the record of the proceeding
with respect to Acindar – the US average prices (w hich included goods exported to the United States)
– and compared them with Acindar's sales prices. Acindar's sales prices were lower than the US
average prices. Commerce also reviewed Acindar's financial statements, which reflected its
weakened financial position. Based on the totality of the evidence, Commerce concluded that it was
likely that dumping would continue or recur if the order were revoked.
27

(b) If the USDOC intended to determine whether the Argentine exports to the United States
were dumped during the period of review, please explain why the USDOC did not seek
information relating to these companies' domest ic sales prices and their export prices to
the United States. Please explain how the USDOC intended to, and the extent to which
it did, determine whether these compani es dumped in the past on the basis of
information that it sought from them, i.e. their costs and the volume of their shipments
to the United States, citing any record evidence supporting your response. Please
explain how this relates to the obligatio ns under Articles 11.3 and/or 2.1 of the
Agreement.

28. Commerce did not intend to determine whethe r the Argentine exports to the United States
were dumped during the period of review. Rath er, Commerce sought to collect information about
past behaviour to facilitate its evaluation of what would be likely to happen in the future. Commerce
did not seek Argentine producers' export prices to the United States because it was aware of the
brevity of the time available to conduct the proceedi ng. Commerce considered that, in the context of
the limited amount of time available to conduct the proceeding, it could place the US price
information based on Acindar's importers' data on the record prior to the due date for the respondents'
answers to the questionnaires and, having given th e respondents the opportunity to comment on that
data, instead have the respondents focus on gather ing data Commerce could not access – cost data.
Therefore, respondents were free to discuss the relevance of the da ta on the record as early as
22 November 2005, and to provide alternative data should they consider the existing price data
inappropriate.

29. Siderca actually proposed comparing its cost s to the Preston price data, in lieu of the
comparison methodology proposed by petitioners' counsel.
28 Petitioners' counsel had proposed using
Argentine average unit values based on Argentina's export classification system, but Siderca argued
that such data did not form the most appropriate basis for comparison. Siderca then suggested that
comparing its costs to the Preston price data, rather than the Argentine average unit values supplied by
petitioners was more appropriate.

27 Section 129 Determination, at 10 (Exhibit ARG-16).
28 7 December Letter from Siderca, p. 5 (Exhibit ARG-19).

Q11.

(a) Please explain to what extent, if at all, an investigating authority is bound by the
definition of dumping found in Article 2.1 of the Agreement in a determination
regarding the existence of dumping in the period of review in a sunset review under
Article 11.3 of the Agreement. In other words, in your view, can an investigating
authority determine the existence of dumping without having regard to the normal
value and export price of the exporter(s) under review?

30. The Appellate Body in US – Corrosion Resistant Steel Sunset Review explained the
relationship between Article 2.1 and Article 11.3, noting that Article 2.1 "describes the circumstances
in which a product is to be considered as being dumped for purposes of the entire Anti-Dumping
Agreement, including Article 11.3".
29 The Appellate Body went on to state that "the question for
investigating authorities, in making a likelihood de termination in a sunset review pursuant to
Article 11.3, is whether the expiry of the duty would be likely to lead to continuation or recurrence of
dumping . . . (that is, to the introduction of that product into the commerce of the importing country at
less than its normal value)". 30 Notably, however, the Appellate Body ultimately concluded that –
even though the definition of dumping applies in sunset reviews, investigating authorities are
nevertheless not obligated to calculate a margin of dumping.
31 Nor did the Appellate Body conclude
that an investigating authority must calculate a futu re normal value and a future export price, or a past
normal value and a past export price. Rather, th e Appellate Body noted that Article 11.3 does not
prescribe a methodology, nor identify particular factors to be examined.

31. The question for Commerce in the Section 129 proceeding was whether dumping would be
likely to continue or recur if the order were revoked; in other words, would normal value likely
exceed export price. To make that forward-looki ng determination, Commerce examined the past
behaviour of the two identified Argentine exporters . Commerce was aware that Acindar did not have
a viable home market or third country sales.
32 Rather than asking respondents to provide information
that Commerce knew the lone exporter could not provide, Commerce instead asked respondents to
provide product-specific cost data. Commerce did so for the purpose of examining respondents' past
behaviour over the life of the order. Respondents were unable to provide actual product-specific cost
data. Commerce therefore used "other independent sources" of information as set out in paragraph 7
of Annex II ( i.e., "published price lists, official import statistics and customs returns"). On the basis
of Acindar's pricing behaviour, as evidenced by the importer data, Commerce concluded that it was
likely that Acindar had dumped during the life of the order. Acindar offered no contrary evidence.
As a result, Commerce relied on the importer data a nd price lists as one basis to support its ultimate
conclusion that dumping would be likely to continue or recur if the order were revoked.

(b) In your view, is there a difference between calculating the margin of dumping for an
exporter and determining the existence of dumpi ng for that exporter? In other words,
can an investigating authority determine that an exporter dumped in a given period in
the past without calculating a margin of dumping or relying on a margin already
calculated in the past? If your response is in the affirmative, please explain whether such
a determination can be made without having regard to the two components of dumping,
i.e. normal value and export price, set out in Article 2.1 of the Agreement.

29 Appellate Body Report, United States – Sunset Review of Anti-Dumping Duties on
Corrosion-Resistant Carbon Steel Flat Products from Japan , WT/DS244/AB/R, para. 109 (adopted
9 January 2004) ("US – Corrosion-Resistant Steel Sunset Review (AB)").
30 See US – Corrosion-Resistant Steel Sunset Review (AB), para. 109.
31 See US – Corrosion-Resistant Steel Sunset Review (AB), para. 127.
32 Oil Country Tubular Goods Other than Drill Pipe , 68 Fed. Reg. 13,262 and Issues and Decision
Memorandum, at Comment 1 (Exhibit US-3).

32. Article 5.1 provides for an investigation to de termine the "existence, degree and effect" of any
alleged dumping. Therefore, the Anti-Dumping Ag reement itself contemplates a distinction between
the existence of dumping and the degree of dumping. For example, an exporter could stipulate that its
normal value exceeded export price in a particular period. In that case, dumping would exist, but it
would not be possible to calculate a margin of dumping.

33. Commerce did not determine the existence or degree of dumping during the sunset period of
review, nor was it obliged to do so. Instead, Comme rce examined the past behaviour of Acindar,
including Acindar's prices as reflected on the im porters' customs entries, as well as the prevailing
price in the United States, and concluded that it was likely that Acindar had dumped during the sunset
period of review. There was no evidence to the contrary on the record of the proceeding.

34. Notably, Acindar did not even attempt to ar gue that it had not dumped, or that it would not
dump if the order were revoked; rather, Acindar ar gued that it had not been a significant producer of
OCTG during the sunset period of review.
33 However, Acindar was, of course, the only Argentine
exporter of OCTG during the sunset period of review . Based on an examination of all of the facts,
Commerce concluded that Acindar was likely to dum p if the order were revoked – in other words,
Commerce concluded that Acindar's export price would likely be lower than normal value.

(c) On what basis could an investigating authority properly find affirmative likelihood of
continuation or recurrence of dumping oth er than with regard to the existence of
dumping?

35. A determination of likelihood of continuati on or recurrence of dumping is made on the basis
of the facts before the investigating authority. Gi ven the forward-looking nature of the inquiry, which
must presume a fact not in existence (termination of the order), there is no one methodology, no single
factor, that must be taken into account in reaching any conclusion about what is likely to happen in
the future. At a minimum, no determination of the existence of dumping is necessary; Article 11.3
does not require it.
34 Indeed, the Agreement itself recognizes that a finding of no dumping is not
dispositive of the question of whether dumping is likely to continue or recur.35 The probative value of
other factors would depend on the facts of each determination.

Q12. The Panel notes Argentina's claim regarding the comparison the USDOC made between
Acindar's export prices and the average transact ion price (by weighted average value) that
prevailed in the US market for the subject pr oduct. The Panel also notes that the USDOC
inferred from this comparison the conclusion th at Acindar was likely dumping in the period of
review.

(a) Please explain the legal basis under the Agreement for basing a determination of
dumping, be it likely or actual, on a comparison of an exporter's export price with the
average transaction price (by weighted average value) that prevails in the country of
imports for the subject product.

36. The United States considers that the circumstan ces of this sunset review must be kept in
mind. First, the sole known exporter of Argentine OCTG to the United States prior to the sunset
review stopped shipping to the United States after the imposition of the order. Therefore, there were
no administrative reviews of that shipper and no dumping margins calculated pursuant to any such
review. Second, a new entrant into the US market appeared anonymously during the sunset period of

33 Acindar Questionnaire Response (Exhibit ARG-14).
34 Article 11.3 does not require separate determinations as to whether dumping is likely to continue,
versus whether dumping is likely to recur.
35 See Article 11.3 (dumping may recur) and Footnote 22 (absence of dumping in the most recent
review does not require a negative determination in a sunset review).

review and was not subject to administrative review until after the sunset period of review. There
was, therefore, for the sunset period of review, a limited amount of information, attributable entirely
to the respondents' own choices (to st op shipping and to decline to par ticipate in the sunset review).
The answer cannot be the one advocated by Argentina – that a lack of shipping activity, or a failure to
make oneself known, necessarily requires a negative de termination as to what would happen if the
order were revoked. It would be odd indeed for th e Agreement to contemplate that the order may be
continued even if a respondent has obtained a zero margin in its most recent administrative review,
but that the order must be revoked if respondents manage to avoid having their transactions examined.
The investigating authority must do what it can with the information it has, including the information
submitted – or not submitted – by the respondents.

37. Article 11.3 does not prescribe any particular methodology to be used by an investigating
authority in making a likelihood determination in a sunset review. 36 Commerce did not examine the
existence of dumping, nor did it calculate a dumping margin; nor is an investigating authority obliged
to do so under Article 11.3. As the Appellate B ody has recognized, "a broad range of factors other
than import volumes and dumping margins is potentially relevant to the authorities' likelihood
determination".37 Therefore, the legal basis for Commerc e's analysis of the facts before it is
Article 11.3, which does not prescribe the methodology or the factors to be examined.

38. The United States notes that the information Commerce examined is precisely the information
identified in paragraph 7 of Annex II – customs return s and price lists. As the United States noted in
its closing statement, if the Argentine respondents c onsidered that there was a more suitable price list
to be considered, the respondents were free to pl ace such a list on the record. Commerce placed the
Preston price list on the record on 22 November 2005, over a week before the respondents'
questionnaire responses were due

39. Finally, as discussed below, in additi on to comparing Acindar's export prices to
contemporaneous prices in the United States for th e same category of merchandise, Commerce also
considered the condition of the OCTG market at the end of the sunset review period.

(b) The Panel notes Argentina's assertion th at the USDOC ignored certain factors that
affected this comparison, such as differences in the physical characteristics of the
products compared, the levels of trade at which the comparison was made, as well as
differences relating to transportation costs.

Please explain in detail and by referring to the relevant parts of the record, whether any
of these factors were known to the USDOC in the Section 129 proceedings at issue and, if so,
whether this was taken into account.

40. The United States considers that, in keeping wi th the scope of the Panel's review as provided
under Article 17.5(ii) of the Anti-Dumping Agreemen t, it is important to recall the facts and
arguments before the investigating authority. In response to Commerce's request for data on ten
product categories, Siderca argued that there were "literally thousands" of product combinations
within Commerce's categories
38, suggesting that no comparison at all was possible. In response to
comments from petitioners' counsel, Siderca then argued that Commerce should make an even
broader comparison than the one Commerce had proposed in the questionnaire, and Siderca, in fact,
used the Preston Pipe and Tube data as the basis for comparison. 39 Moreover, Argentina neglects to
provide a method for making such adjustments given that the data is not that specific. Had Argentine

36 US – Corrosion-Resistant Steel Sunset Review (AB), para. 149.
37 US – Corrosion-Resistant Steel Sunset Review (AB), para. 186.
38 Siderca's Questionnaire Response, p. 4 (Exhibit ARG-15).
39 Siderca's 7 December Letter, p. 5 (Exhibit ARG-19).

producers maintained their product-specific cost da ta from the period, Commerce would have been
able to conduct its analysis on a more specific level.

41. Recalling that Commerce was not calculating a dumping margin pursuant to Articles 2.2
et seq, Commerce nevertheless took into account characteris tics that would have the greatest effect on
price.
40 The Preston Pipe & Tube Report separated products by type of OCTG, whether welded or
seamless, and whether carbon or alloy. Its segre gation of tubing from casing also addressed much of
the size concern Argentina now raises, as tubing is a small tubular product in limited sizes, and casing
is larger size material. Even in the comparison Ar gentina raised during the panel hearing, Argentina
conceded that there is minimal overlap in sizes between tubing and casing. Additionally, though the
Preston Pipe & Tube Report does not distinguish be tween end finish (e.g. plain vs. threaded and
coupled), the universe of material included in the carbon welded tubing and carbon welded casing
groups does include both plain and threaded and coupl ed material, diminishing any impact this may
have on price comparisons. With respect to trans portation costs, we note that not all of the Preston
Publishing selling prices included transportation cost s. The Preston Pipe data included both domestic
and import shipments. The terms of the latter were FOB mill. 41 Even had Commerce been able to
adjust for these factors, Acindar's sales prices were so far below the US average prices that the end
result would likely have not changed.

42. The United States recalls that two of the exhibits Argentina presented during its oral
argument, Exhibit ARG-34 And Exhibit ARG-35, were not on the record of the Section 129
proceeding. Therefore, Commerce did not have this information before it when making its
determination. Consideration of such information cannot be reconcile d with Article 17.5 (ii) of the
Agreement.

43. Even if the Panel were to consider the f acts introduced here, and not in the Section 129
determination, the price lists included therein are for seamless OCTG, yet Acindar sold only welded
OCTG – a product with a very different cost and price structure. Furthermore, a price list is not the
actual price arrived at for the sale. In fact, disc ounting of list prices was common practice during the
period because of the depressed condition of the OCTG market.

44. Argentina asserted that the carbon versus a lloy comparison shows a difference of less than
10 per cent.
42 This comparison fails to accurately reflect the parameters of carbon and alloy products
sold in the marketplace. Whereas there are a li mited number of carbon grades, there are a multitude
of alloy grades. Alloy market prices of OCTG will reflect a composite of these alloy grades. In fact,
following the same logic of Argentina, if we were to compare non-normalized J55 carbon tubing to
alloy P grade material, there would be a price differe nce of 35 per cent. Commerce made every effort
to take physical characteristics and other differe nces into account when making its comparisons.
However, it was limited by the available informat ion on the record – information that was limited
because Argentine respondents failed to retain their product-specific cost data.

45. In short, Commerce analyzed the evidence on the record before it, which was sufficiently
specific to enable a basic comparison of Acindar' s prices to the prevailing prices in the market.
Commerce was not calculating a margin of dumping, nor was it obliged to. Rather, Commerce
engaged in an examination of Acindar's past beha viour as a basis for evaluating what Acindar would
be likely to do in the future.

Q13. The Panel notes that the USDOC's Section 129 Determination states that the USDOC
did not use the cost data in Acindar's financia l statements because those data related to a
product category that included products other th an the subject product. The USDOC stated

40 US Second Written Submission, at 12.
41 Information for the Record, app. III (Exhibit ARG-18).
42 Argentina Opening Statement at Panel Meeting, at para. 33 (12 July 2006).

that "the inclusion of costs related to the m erchandise not subject to review would distort [the
USDOC's] analysis." Yet the USDOC relied on these financial statements with respect to its
determination that the OCTG market was depressed in the period of review.

(a) Please explain, by referring to the relevan t parts of the record, the relevance of the
financial statements of Siderca and Ac indar for both the company-specific and
order-wide phases of the USDOC's sunset de termination in these proceedings. More
specifically, please explain whether the USDOC used these statements in support of its
order-wide determination that dumping was likely to continue or recur should the order
be revoked and where such use is reflected on the record.

46. With respect to the company-specific determ ination for Acindar, Commerce found that the
weakened condition of Acindar, as reflected in its financial statements, supported Commerce's finding
that Acindar had likely dumped during the period and w ould likely continue to do so if the order were
revoked.
43

47. With respect to the order-wide determination, Commerce used Siderca and Acindar's financial
statements in conjunction with SEC filings from US producers to establish that there was a depressed
OCTG market.44 Specifically, Siderca's financial statement explained that, "[s]ales for the year were
$486 million (25 per cent less than the $645 million in the previous year) reflecting the effects of the
drastic fall in world demand for tubes in the oil industry , caused by the fall in oil prices and shrinking
steel markets".
45 The United States notes that Siderca stated on the record of the Section 129
proceeding that "1999/2000 was, by all accounts, a period in which the global OCTG market was
depressed . . . ".46

48. In addition to Siderca's own statement on the record of the Section 129 proceeding,
information from the financial statements of the other US producers supported a finding of a
depressed OCTG market. For example, Maverick Tube Corporation's 1999 10K report explains:

 Although drilling activity has been recovering from the recently depressed levels, no
assurance can be given regarding the timing and extent of such recovery.
47

49. The NS Group similarly explains that:

 Demand for our OCTG products began to d ecline in the second half of fiscal 1998 and
continued to decline significantly in fiscal 1999. Significant declines in oil and natural
gas prices lead to a decline in drilling activit y in the United States throughout most of
1999. This decline resulted in extensive industry-wide tubular inventories, which
further negatively affected our OCTG business . .

The market conditions described above negatively affected our business
during the latter half of fiscal 1998 and fiscal 1999. Our business experience
indicates that oil and natural gas prices are volatile and can have a substantial
effect upon drilling levels and resulting demand for our energy related
products. Oil and gas prices and drilli ng activity began to improve in the
fourth quarter of fiscal 1999, and have continued to improve into fiscal 2000.
However, the timing and extent of such recovery is uncertain and we expect

43 Section 129 Determination, at 10 (Exhibit ARG-16).
44 Section 129 Determination, at 7 (Exhibit ARG-16).
45 Siderca's Questionnaire Resp., at page 13 of Siderca's 2000 Financial Statement (emphasis added)
(Exhibit ARG-15).
46 Exhibit ARG-19 (p. 7).
47 OCTG Filings of Domestic Producers, at Maverick's 1999 10K, p. 47 (Exhibit US-19).

to incur operating losses in the energy products segment during the first half
of fiscal 2000.
48

50. These statements confirmed the weakness of the OCTG market during the period as well as
the uncertainty facing the industry at the end of the period.

(b) Please explain, by referring to the relevan t parts of the record, whether the financial
statements of these two companies reflected the overall production operations of these
companies or whether the data relating to the subject product, i.e. OCTG, could be
separately identified.

51. The financial statements reflected the ove rall production operations of the companies.
Because both companies produce OCTG and non-OCTG products, the subject merchandise could be
identified only in those parts of the financial stat ements that specifically reference OCTG production
or sales, as opposed to non-OCTG production or sales. For example, even though the financial
statements did not break out sales or costs for OCTG specifically, sometimes OCTG was mentioned
in the text. One such example is when Siderca expl ained that "the international trade in tubes for the
oil industry (OCTG – Oil Country Tubular Goods) was down 38 per cent."
49

(c) Please explain whether the share of OCTG in these two companies' overall production
operations was taken into account in ma king the inference on the basis of these
statements that the OCTG market was depressed

52. Siderca's financial statement stated that th ere was a "drastic fall in world demand for the oil
industry," which, as a matter of logic, meant there was a similar fall in the demand for OCTG. 50
Though the statements regarding Acindar's financial condition were more general, as explained above,
Commerce referred to the SEC filings of US OCTG producers to confirm the depressed situation of
the OCTG market. The United States recalls that even Side rca asserted that the OCTG market was
depressed in "1999/2000".51

(d) Please explain why the USDOC made inferences regarding the state of the OCTG
industry from Acindar's financial statements when it had found the information
contained in those statements to be too broad for calculating a meaningful cost/price
trend analysis.

53. Financial statements contain information that can be relevant to different aspects of a
determination. While the financial statements di d not contain sufficient information to calculate a
trend analysis, they did provide one of many sour ces of support for the fact that the OCTG industry
was depressed. Therefore, while there were several sources in s upport of the fact that the OCTG
industry was depressed, there were no alternate sources to confirm whether the overall cost/price trend
analysis reflected the reality of Acindar's OCTG production and sales.

Q14.

(a) Please state your reaction to Argentina's proposition, in paragraph 42 of its Oral
Submission, that past events are not susceptible to prediction and that an investigating
authority can determine that either dumping o ccurred in the past or it did not or one
does not know.

48 OCTG Filings of Domestic Producers, at NS Group's 1998-99 10K, pp. 7-9 (Exhibit US-19).
49 See, e.g., Siderca's fiscal year ending 31 March 2000, at 3.
50 Section 129 Determination, at 9 (Exhibit ARG-16) (emphasis added).
51 Siderca 7 December Letter, p. 7 (Exhibit ARG-19).

54. Commerce did not "predict" past events, becau se a prediction is foretelling of something that
has not yet occurred. Instead, Commerce looked at record evidence, including Acindar's actual sales
prices to the United States and prevailing average pri ces in the United States. It then concluded that,
based on the depressed OCTG market and significan t underselling, Acindar had likely dumped during
the period. Argentina seems to assume that infe rences cannot be drawn about the past. However,
Argentina does not explain why that is true.

55. Nothing in the text of Article 11.3 requires an investigating authority to determine that
dumping occurred in the past or to conclude that it does not know whether dumping occurred in the
past. Argentina's position would, not surprisingly, permit companies to manipulate proceedings to
deprive the record of certain kinds of evidence in or der to require a negative de termination. That is
not what Article 11.3 provides, nor is it consiste nt with the responsibility that each company bears
when participating in an anti-dumping proceeding.

(b) In your view, what is, if any, the difference between determining past dumping and past
likely dumping?

56. Please also refer to the answers to question 11, above. The meaning of "dumping" is defined
in Article 2.1 of the Agreement, i.e., selling a product in another country at less than its normal value.
To calculate a dumping margin, the remainder of Article 2 provides a specific methodology to take
into account a variety of factors. In contrast, an Article 11.3 determination is a prediction of what is
likely to occur if the order is revoked. There is no obligation to determine the existence of dumping,
nor to calculate a margin.

57. Simply because Commerce used the term "likel y dumping" to describe its findings concerning
the comparison of Acindar's export prices to prevailing prices in the US market does not mean that
Commerce determined the existence of dumping, nor that the obligati ons with respect to calculation
of a dumping margin under Article 2 apply. Ra ther, given the nature and constraints of the
proceeding, Commerce sought to examine each company's behaviour during the life of the order.

58. Commerce's determination that Acindar ha d likely dumped was based on Acindar's export
sales to the United States and US average unit valu es. Commerce had to rely upon US average unit
values as a type of surrogate for normal value out of necessity because there were no other reliable
data.

59. Acindar had no viable home market, no third country sales, and did not keep its costs.
Siderca also failed to keep its product-specific co sts. As provided in Annex II, Commerce used a
price list as a surrogate for normal value, and that price list was Preston Pipe & Tube.

60. These pricing data were not the only inform ation underlying Commerce's likely past dumping
finding as to Acindar. In addition to making the price comparison, Commerce concluded from
information gathered from Acindar's financial statem ents that Acindar was in a weakened financial
condition, also supporting Comme rce's conclusion that Acinda r had likely dumped during the
period.
52

Q15. The Panel notes the following parts the USDOC's Section 129 Determination regarding
the state of the OCTG industry:

We note that Acindar's US sales of OCTG occurred shortly before the end of the
original sunset review period. Absent ev idence that Acindar intended to cease
selling in the United States, and ab sent evidence that prevailing market
conditions were likely to improve in the near future , we consider such sales

52 Section 129 Determination, at 10 (Exhibit ARG-16).

indicative of Acindar's likely future pricing behaviour were the order to be
revoked. (emphasis added)

Given the weakened condition of Siderca at the end of the original sunset review
period, we consider that there was no valid indication that a sudden turn-around
in the OCTG market was likely. (emphasis added)

The Panel also notes Argentina's statement in paragraph 99 of its First Written Submission that
"USDOC's conclusion that there is "no valid indication that a sudden turn-around in the
OCTG market was likely" is demonstrably contrary to the evidence." In this regard, Argentina
refers to Siderca's letter dated 7 December 2005 (Exhibit ARG-19). That letter states:

Also, Siderca's Financial Statement for the period ending 30 June 2000 shows
profitability increasing and links this in crease with the recovery in the oil and
gas sector that was already underway. (footnote omitted)

This letter in turn refers to Siderca's letter dated 30 November 2005, found in Exhibit ARG-15.
Financial statement of Siderca as at 30 June 20 00, attached to the mentioned letter, reads in
relevant parts:

Improved crude and gas prices have been responsible for a steady recovery in
the petroleum and steel markets. In this context, the level of business of the
Company during the first quarter of the year recorded a significant
improvement, based on a recovery of sales volum es and a gradual rise in prices
on the international steel tube market. (emphasis added)

Business in the first quarter measured by sales volume totalled 185,882 tons and output reached
195,132 tons, more than in the same period fo r the previous year, when volumes totalled
124,921 tons and117,250 tons, respec tively. These figures are an indication of the recovery
experienced in the sector, and exports in particular. (emphasis added)

 The Panel notes that financial statements of Siderca for the fiscal year ending
31 March 2000, found in Exhibit ARG-36, reads in relevant parts:

In the middle of the fiscal year oil prices be gan to record a significant recovers- hitting
US$30 per barrel in March- generating an in crease in drilling and investment activity
by oil companies.

This recovery came too late to have a significant effect on the volume of sales for
the year. (emphasis added)

The recovery in crude prices and the good level of gas prices will influence a
steady recovery ion the oil an d steel markets. This outlook, seen in the context of
the introduction of new installations a nd significant improvements in costs at
operating level, leads to an optimistic outlook for the coming year.

The international market for seamless tubes has seen a profound globalization in
recent years. (emphasis added)

The Panel also notes that the Preston Pub lishing data contained in Exhibit ARG-18
Attachment 3 indicates that the prices of all subject products showed an increasing trend
towards the end of the period of review of the Section 129 Determination at issue, specifically
from September 1999 through July 2000.

(a) Please indicate the period of review in th is Section 129 sunset review. Please explain
which parts of that review period the above-referenced financial statements covered.

61. The period of review for the Section 129 Determination covered the same period as the
original sunset review – 1 August 1995 through 31 July 2000. 53 The United States recalls that in
response to the arbitrator's questions in the Artic le 21.3(c) proceeding, Co mmerce clarified that its
collection of information would be limited to the original sunset review period. Commerce relied
upon Acindar's yearly financial statements that covered the beginning of the period through
June 2000, and Siderca's yearly financial statemen ts that covered from the beginning of the period
through March 2000.

(b) Did the USDOC consider the above-quoted in formation in the financial statements and
the Preston Publishing data in its Section 12 9 Determination, in particular with regard
to its proposition that the OCTG industry was depressed and that there was no
indication of recovery in the near future?

62. Commerce considered all record evidence in its assessment of the OCTG industry and its
determination that there was no indication of recovery in the near future. However, the statements
from Siderca's financial statement relating to th e future state of the OCTG market were only
predictions that were contradicted by statements in the US producers' US Securities and Exchange
Commission ("SEC") filings. The United States notes that it did not place significant weight on
Siderca's last quarterly statement as it represented only a quarter and was unaudited, while Commerce
did rely on the full-year audited financial statements.
54

63. As an initial matter, it should be noted that while a trend toward upward prices is discernable
beginning in September 1999 and continuing through the end of the sunset period, the trend is not
without setbacks. Specifically, the Preston data show that prices for five of the eight product
categories dropped at least once during the period September 1999 through July 2000, and some
dropped twice. For example, the Preston data show the following pricing data for the year 2000:

Carbon ERW Tubing: January: $762; February: $759.
April: $788; May: $781
Carbon Seamless Casing: April: $684; May: $671
Alloy ERW Tubing: February: $957; March: $948; April: $944
Alloy Seamless Tubing: Februa ry: $1,035; March: $1,014;
June: $1,050; July: $1,048
Alloy Seamless Casing: April: $829; May: $822
55

64. These data confirm the statements found in US producers' SEC filings that repeatedly point
toward the continuing vola tility of market prices and uncertainty f acing the industry at the end of the
period. In addition to the cites above in 13(a), th e following also confirms the volatility of the OCTG
market. Lone Star explained that:

Historically, over 60% of Lone Star's reve nues have been generated through the sale
of oilfield products. As a result, Lone Star's revenues are largely dependent on the
state of the oil and gas industry, which has historically been volatile.
56

53 Questionnaire, at 1 (Exhibit ARG-13).
54 See US Second Written Submission, at 16.
55 Information for the Record, at app. III (Exhibit ARG-18).
56 OCTG Filings of Domestic Producers, at Lone Star's 1999 10K, pp. 20 (Exhibit US-19).

65. Also, Maverick Tube Corporati on's 1999 10K report explains that:

As our recent experience indicates, oil and gas prices are volatile and can
have a substantial effect on drilling levels and resulting demand for our
energy related products . . .
57

66. Because of price volatility, price trends alone, in this particular industry, are not necessarily
reliable, or sufficient, to indicate true market r ecovery. Commerce did not consider a slight increase
in prices at the end of the period a sufficient indicator of a lasting shift in the demand for OCTG that
had been depressed for the majority of the period.

Q16. The Panel notes Argentina's assertion in paragraph 30 of its Oral Statement that in the
period of review of the Section 129 Sunset Determ ination at issue, the prices of the subject
product in the United States were significantly higher than other markets. Please elaborate by
referring to the relevant parts of the record of the measure at issue.

67. Commerce made no such finding, and Argentina has not identified the information on the
record to which it was referring.

Q17.

(a) How, if at all, did the original panel address the parties' claims and arguments relating
to the USDOC's volume analysis? Did it exercise "judicial economy"?

68. According to the Appellate Body:

The practice of judicial economy . . . allows a panel to refrain from making multiple
findings that the same measure is inconsistent with various provisions when a single,
or a certain number of findings of inconsistency, would suffice to resolve the
dispute.
58

69. In this dispute, the original Panel in its in terim report did not address the WTO-consistency of
the volume analysis. The United States considered that in doing so, the original Panel exercised
judicial economy.
59 In response to a request from Argentina to make factual and legal findings, the
original Panel in its final report made factual findings but declined to make any legal findings. 60 The
original Panel concluded that, in view of the finding that reliance on the dumping margin was
inconsistent with Article 11.3, there was no need to address whether the volume analysis was also
inconsistent with Article 11.3, and the original Panel declined to make a legal finding in that regard.
Argentina argued that such a finding could be n ecessary for purposes of appeal, but the original Panel
considered that argument "hypothetical" and rejected it. 61 However, the original Panel did agree to
make factual findings to permit Argentina to appeal. 62 Argentina did not appeal the original Panel's
conclusion that it did not need to address the volume analysis, nor did Argentina appeal the original
Panel's exercise of judicial economy.

57OCTG Filings of Domestic Producers, at Maverick's 1999 10K, p. 47 (Exhibit US-19).
58 Appellate Body Report, Canada – Measures Relating to Exports of Wheat and Treatment of
Imported Grain , WT/DS276/AB/R, para. 133 (adopted 27 September 2004) (" Canada – Wheat Exports and
Grain Imports").
59 US Comments on Argentina's Comments on the Interim Report, para. 3.
60 Panel Report, para. 6.11.
61 Panel Report, para. 6.11.
62 Panel Report, para. 6.11.

(b) What considerations should guide this Pa nel in addressing the parties' claims and
arguments in these 21.5 DSU proceedings? Would any prejudice arise to any party in
the event the Panel did, or did not, address the volume analysis?

70. The United States considers that it is important to recall that this proceeding is a compliance
proceeding. The question for this Panel is to ass ess the existence or consistency with a covered
agreement of measures taken to co mply with the recommendations and rulings of the DSB. As the
United States noted in its opening statement, Arge ntina disregards the recommendations and rulings
and appears to be asking the Panel to treat this pro ceeding as if it were an original proceeding. That
approach is manifest in the lack of reference in Argentina's submissions to the recommendations and
rulings of the DSB, and Argentina's insistence that the volume analysis is within the scope of this
Article 21.5 proceeding. But this is not an original proceeding – it is a compliance proceeding.

71. The redetermination in this dispute, and the volume analysis, are analogous to the EC's
redetermination, and the "other factors" analysis, in EC – Bed Linen (21.5) , and the considerations
identified in that dispute are equally applicable here. The Appellate Body in Bed Linen explained that
the part of a redetermination that merely incorpor ates elements of the original determination, and
which the responding Member did not have to change in order to comply with the recommendations
and rulings of the DSB, is not part of a measure taken to comply.
63 The panel in that dispute
articulated the important differences between an original proceeding and a compliance proceeding,
and particularly the prejudice that would inure to a responding Member if the two were confused:

the defending Member would have no oppor tunity to bring its measure into
conformity with the AD Agreement . . . . Moreover, the defending Member would
be subject to potential suspension of concessions as a result of a finding of violation .
. . which, because it was not the subject to any finding of violation in the original
report, the Member was entitled to assume w as consistent with its obligations under
the relevant agreement. Such an outcome would not seem to be consistent with the
overall object and purpose of the DSU to achieve satisfactory resolution of disputes,
effective functioning of the WTO, to main tain a proper balance between the rights
and obligations of Members, and to ensure that benefits accruing to any Member
under covered agreements are not nullified or impaired.
64

72. The panel went on to note:

[T]he dispute settlement system provides Members with time to bring inconsistent
measures into conformity, prefers mutually acceptable solutions, and provides for
suspension of concessions only as a last resort.
65

73. These considerations apply in this instance as well. The original Panel did not make any
recommendation or finding regarding the volume analysis. Therefore, the volume analysis was not
part of the recommendations and rulings of the DS B, and the United States did not fail to implement
the recommendations and rulings by not reconsideri ng the volume analysis. If this Panel were to
make an adverse finding now, the United States woul d have no reasonable period of time to bring its
measure into conformity with the Anti-Dumpi ng Agreement and would be subject to potential
suspension of concessions as a result of a finding of breach that was not in the original report.

63 See US First Submission, para. 34, citing EC – Bed Linen (21.5) (AB), paras. 86-87.
64 Panel 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/RW, para. 6.40 (adopted 24 April 2003,
as modified by the Appellate Body Report, WT/DS141/AB/RW) ("EC – Bed Linen (21.5) (Panel)").

74. Argentina attempts to distinguish EC – Bed Linen (21.5) , arguing that in this dispute there
was no finding that Argentina had failed to make a prima facie case.
66 Argentina misses the point.
The reasoning in EC – Bed Linen (21.5) is not limited to circumstances in which a panel finds that a
complaining party has failed to make a prima facie case, particularly in terms of the prejudice a
responding party would suffer. The reasoning is app licable to circumstances in which an issue was
litigated, but no finding of inconsistency was made. Under those circumstances, a Member has no
reasonable period of time to bring its measure in to compliance and faces a potential suspension of
concessions. As the panel in EC – Bed Linen (21.5) noted, suspension of concessions, without the
reasonable period of time to bring the measure into compliance, would not seem to be consistent with
the balance of rights provided for under the DSU.

75. The United States notes that had Argentina c onsidered a finding on the volume analysis to be
"necessary" to resolve the dispute, Argentina could ha ve appealed the original Panel's conclusion that
such a finding was not necessary, and Argentina could have li kewise appealed the original Panel's
exercise of judicial economy as false. 67 This is particularly true because the original Panel, in
response to a request from Argen tina, made factual findings to enable the Appellate Body to
"complete the analysis" regarding the volume finding had Argentina appealed. 68 However, Argentina
declined to appeal and accepted the original Pane l's conclusion – that a fi nding of inconsistency
regarding the volume analysis was not necessary to resolve the dispute. Having litigated the exact
same issue in the original proceeding, and having accepted the original Panel's exercise of judicial
economy, Argentina is now precluded from relitigati ng that issue as part of an Article 21.5
proceeding.

76. Argentina appears to be aware that it is precluded from relitigating the same issue for which
no finding of inconsistency was made, and instead attempts to characterize the volume finding as a
new element of the measure taken to comply, analogizing the volume analysis to Australia –
Automotive Leather II, Australia – Salmon, and US – Softwood Lumber (CVD) (21.5) . None of those
disputes involves the factual posture here, which is the absence of a finding of WTO-inconsistency
with respect to the issue in question in the orig inal proceeding. The United States does not dispute
that the new analysis undertaken in the Section 129 de termination is within the scope of the
Article 21.5 proceeding. The United States has not ar gued, for example, that Commerce's analysis of
Acindar's likely dumping is not part of the measure taken to comply, because that issue was not
litigated in the original proceeding, nor could it have been.

77. In response to the Panel's specific reference to US – Softwood Lumber IV (21.5), the reasoning
in that report is not applicable to the facts of this dispute. The United States recalls that in Softwood
Lumber, the recommendations and rulings of the DSB pertained to the "pass through" analysis
conducted in the countervailing duty investigation.
69 The question for the panel, and the Appellate
Body, was whether the pass through analysis in an administrative review – an entirely separate
measure – was within the scope of the Article 21.5 proceeding. 70 There was no question but that the
recommendations and rulings pertained to the pass through analysis; the question was whether that
analysis, as found in an additional measure, fell with in the scope of Article 21.5. By contrast, the
volume analysis in this dispute was not part of the recommendations and rulings of the DSB.

66 Argentina Opening Statement at Panel Meeting, para. 70.
67 See Appellate Body Report, European Communities – Export Subsidies on Sugar, WT/DS265/AB/R,
WT/DS266/AB/R, WT/DS283/AB/R, para. 335 (adopted 19 May 2005) ("In this case, the Panel's findings . . .
were not sufficient to 'fully resolve' the dispute. . . . This constitutes false judicial economy and legal error.")
("EC – Sugar (AB)").
68 Panel Report, para. 6.11.
69 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 , WT/DS257/AB/RW,
para. 50 (adopted 20 December 2005) ("US – Softwood Lumber (CVD) (21.5) (AB)").
70 US – Softwood Lumber (CVD) (21.5) (AB), para. 54.

(c) Is the USDOC's volume analysis part of the measure taken to comply with the DSB
recommendations and rulings for the purposes of Article 21.5 DSU? Why or why not?
Would it have been possible for the orig inal panel to address the USDOC's volume
analysis?

78. USDOC's volume analysis is analogous to the EC's "other factors" analysis in EC – Bed Linen
(21.5). Both analyses were part of the original determin ation and were simply reincorporated into the
redetermination. (Indeed, the EC had revised its ot her factors analysis to take into account different
data on domestic industry sales, 71 whereas Commerce made no changes to its volume analysis but
rather incorporated it by reference.) The United States was not obligated to reconsider that analysis to
implement the recommendations and rulings of the DSB. Therefore, as in EC – Bed Linen (21.5), the
volume analysis is "part of the redetermination th at merely incorporates elements of the original
determination" and is "an aspect of the original measure", 72 rather than part of the measure taken to
comply.

 Please indicate the relevance, if any, of th e Appellate Body Reports in EC - Bed Linen
(Article 21.5 - India ) and US - Softwood Lumber IV (Article 21.5 - Canada) in your responses
to the above questions.

UNITED STATES

Q18. The Panel notes Argentina's argument that the USDOC disregarded the comments
made by the Argentine exporters with regard to the decline in the volume of imports. The Panel
also notes the US' argument that these comments were not germane to the issue. Siderca's
response to the questionnaire to which Argentina refers in this regard, reads in relevant part:

Whatever the significance of a decline in export volume may be as a general
matter, Siderca knows that, with respect to Siderca, it does not mean that the
product could not be shipped without dumping. The cost data (even with the
limitations explained above) supports Siderca's position: Siderca is a
cost-efficient producer of OCTG and could have shipped OCTG products
profitably to the United States.
(a) Please explain why the USDOC found these comm ents not to be germane to the issue of
the decline in the volume of imports?

79. The United States has not contended that Siderca's comments regarding likely past dumping
were not germane to the volume analysis . Rather, the United States has noted that Siderca's
comments explaining the decline in import volumes were not germane to the US implementation of
the recommendations and rulings of the DSB, which pertained to Commerce's reliance on the
dumping margin from the original investigation, and not to Commerce's volume analysis.
73

80. The United States notes that the comments identified in the question were based on Siderca's
cost data. Far from ignoring Siderca's assertions about its cost data, Commerce in fact addressed the
reliability of the cost data at length in the Secti on 129 determination and ultim ately declined to make
any finding as to whether Siderca had likely dumped, in part based on the lack of US sales during the
sunset period of review.
74

71 EC – Bed Linen (21.5) (Panel), n. 75.
72 EC – Bed Linen (21.5) (AB), paras. 86-87.
74 Section 129 Determination, at 9 (Exhibit ARG-16).

81. The United States also notes that Siderca's comments were not responsive to the question
asked. The question was not whether there had been a decline in imports resulting from the
imposition of the order; rather, the question w as a request for raw data concerning shipments during
the sunset period of review alone. That information formed part of the basis for Commerce's decision
not to make any finding regarding Siderca. Nota bly, in the Section 129 proceeding, Commerce did
not ask for shipment data from any period prior to the sunset period of review, and the question
afforded no basis for Siderca's disc ussion of declining import volumes.
75 Siderca's comments
addressed a question that was not relevant to the Section 129 proceeding.

Q20. The Panel notes Argentina's allegation th at by failing to respond to Siderca's letter
dated 7 December 2005, the USDOC acted inconsistently with Articles 6.1 and 6.2.

(c) How did the USDOC consider the views expressed in this letter?

82. Articles 6.1 and 6.2 pertain to an interested party's right to present evidence. Nothing in
Articles 6.1 or 6.2 requires a Member to "respond" to each submission of any such evidence.
76

83. In reaching its final determination Comme rce considered all comments submitted by the
interested parties. Pages four through five of the Section 129 Determination provide a summary of
Siderca's comments from its 7 December letter, which were offered in rebuttal to a letter from counsel
for petitioners. Commerce took these into consideration in its analysis. For example, in response to
Siderca's comment that Commerce use Preston Pi pe and Tube data on an "all OCTG" level,
Commerce found that it would be "even less specific and overly broad."
77 In addition, as noted above,
counsel for petitioners had proposed using aver age unit values based on the Argentine export
classification system, an approach Siderca opposed in its 7 December letter. Commerce did not use
the approach suggested by petitioners' counsel.

Q21. The Panel notes Argentina's argument that the USDOC failed to make six memoranda
available to the Argentine exporters.

(b) Please explain whether it was "practicable" within the meaning of Article 6.4 of the
Agreement for the USDOC to make the se memoranda available to the Argentine
exporters in these Section 129 proceedings.

84. Notwithstanding the limited time available, Commerce made available to all parties
participating in the proceeding all the informati on submitted to or obtained by it in the Section 129
proceeding to the extent "practicable", as required by Article 6.4. First, Commerce placed the Preston
Pipe and Tube data and Acindar-s pecific importer data regarding Ac indar's sales on the record on
22 November 2005 – before Argentine respondents' questionnaires were even due.78

85. Second, the 16 December 2005, memorandum regarding "Information for the Record",
consisted of respondent a nd domestic interested parties' submissi ons in the original sunset review.
79
Argentina has had access to the public file containing the same information since the original sunset
review.

75 By contrast, Commerce asks for data on pre- and post-order volumes in its standard sunset review
questionnaire.
76 See US Second Written Submission, para. 57.
77 Compare Siderca's Response to US Steel's Comments, at 5-6 (Exhibit ARG-19), with Section 129
Determination, at 8-9 (Exhibit ARG-16).
78 This discussion only concerns the public versions of the memoranda as Article 6.4 only relates to
public information. See Exhibit ARG-18.
79 Exhibit ARG-25.

86. Third, Commerce's memoranda regarding the in consistencies in Siderca's and Acindar's data
were part of the reasoning used in making the determination. Assuming arguendo that such reasoning
is even contemplated by Article 6.4, Commerce disclosed the reasoning as soon as practicable.
Commerce received Siderca's rebuttal of IPSCO's arguments on the cost data as on
14 December 2005. The memoranda on the deficiencies in the cost data were released just two days
later, on 16 December 2005.

87. A more detailed discussion of whether it wa s "practicable" to make certain memoranda
available earlier is provided in the US first and second written submissions.
80

Q24. Please explain whether the APO system und er the US law also allows interested parties
themselves, in addition to counsel for such partie s, to see all confidential information submitted
by other parties in a sunset review.

88. Interested parties themselves are not allo wed access to business proprietary information
submitted under the APO. Instead, their independe nt representative can r eceive access to that
information. This ensures the protection of inter ested parties' confidential information, pursuant to
Article 6.5 of the Agreement.

Q26.

(a) The Panel's understanding of the method used by the USDOC with regard to product
groupings the USDOC made for purposes of e xamining the reliability of Siderca's cost
data is that the USDOC took the weighted av erage costs of, for example, carbon casing
PE and carbon casing T&C, and compared that with the weighted average cost of alloy
casing PE and alloy casing T&C. In other words, the USDOC took as the starting point
of its product grouping for comparison the material used without taking into account
the finishing.

 Is this a correct characterization of the USDOC's methodology? Please explain by
referring to the relevant parts of the record.

89. It is a correct characterization of part of Commerce's methodology for assessing the reliability
of Siderca's submitted cost data.
81 This was only one of the items Commerce considered when
assessing the reliability of data resulting from Siderca' s cost extrapolation. Commerce looked at the
data on a more specific basis as well.

90. Commerce considered the fact that the non- OCTG costs were significantly higher than for
OCTG products.
82 This was an unexpected result because Siderca had been a large producer of
standard line pipe – a lower value-added product – and thus these non-OCTG costs should have been
lower. Commerce also found that Siderca had reporte d lower costs for [BCI]. That is a result that
should not occur.83 The cost of producing an alloy is significant. In addition to the expensive costs of
the alloying elements, working with an alloyed steel is more difficult – driving up the costs of
production. The Preston Pipe and Tube data dem onstrates the typical price differential between
carbon and alloy. For example, in March 1998, car bon seamless casing was priced at $725/ton, while
alloy seamless casing was priced at $917/ton – a difference of $192/ton . Regardless of whether the

80 US First Written Submission, para. 67; and US Second Written Submission, paras. 62-69.
81 Section 129 Determination, at 8; and Inconsistencies in Siderca's Data, at 1 (Exhibit ARG-21). The
entire Siderca memorandum is attached as an exhibit because Argentina only provided a portion of it in Exhibit
ARG-37.
82 Inconsistencies in Siderca's Data, at 2-7 (Exhibit ARG-21).
83 Inconsistencies in Siderca's Data, at 6 (Exhibit ARG-21). The costs for [BCI].

data is reviewed on a broader level or a more speci fic level, the costs did not reflect the reality of
OCTG production.

91. With regard to Siderca's data, even when the costs for [BCI] did not reflect the reality of the
cost of production for OCTG. For example, Siderc a reported that for the year ending March 1998, it
only cost a little over [BCI].

(d) The Panel notes the US' argument that the USDOC made this product grouping in
accordance with the public information available. The Panel also notes that the memo
to which the United States refers in this regard, found in Exhibit ARG-18, contains a
product grouping by Preston Publishing.

 Please demonstrate, by referring to the rel evant parts of this memo, how exactly the
Preston product grouping formed the basis of the USDOC's grouping.

92. The Preston Publishing data are found in the form of a chart in appendix III of Commerce's
22 November 2005 memorandum to the file.
84 The chart indicates a sales price for each month of the
sunset review period for ten product categories. Those product categories are:

· CARBON ERW TUBING;
· CARBON SMLS, TUBING;
· CARBON ERW CASING;
· CARBON SMLS,CASING;
· CARBON DRILL PIPE;
· ALLOY ERW TUBING;
· ALLOY SMLS,TUBING;
· ALLOY ERW CASING;
· ALLOY SMLS, CASING;
· ALLOY DRILL PIPE.

93. The characteristics that constitute th ese product categories were the only physical
characteristics available to Commerce. The cat egories break down the price differences between
carbon and alloy; seamless (SMLS) and welded (ERW); and tubing, casing, and drill pipe.
85
Commerce then compared each Acindar sale with the Preston Pipe and Tube price for that month and
within the appropriate category. Thus, the comparison was both cont emporaneous and product-
specific. Siderca filed comments with Commerce concer ning the Preston data arguing, for example,
that Commerce should compare the Preston Pipe data on an aggregate basis with Siderca's cost data.86

(e) Please explain whether the USDOC informed Siderca of the methodology that it was
considering to use for the grouping of products.

94. Commerce informed Siderca of the product cate gories it was considering in an attachment to
its 31 October 2005 questionnaire to Siderca.
87 The list of categories were based on carbon/alloy, and
plain-end (PE)/threaded and coupled (T&C). Because Siderca produces only seamless OCTG, and
Acindar produces only welded OCTG, the category of seamless/welded was also implicitly included
in the product grouping. However, because Commerc e later found that the Preston data did not create
discrete categories for plain-end and threaded and coupled, Commerce had to modify those categories
when it conducted its analysis.

84 See Exhibit ARG-18.
85 Drill pipe was not used in Commerce's analysis because it was previously revoked from the order.
86 Siderca's 7 December Letter, at 5-6 (Exhibit ARG-19).
87 Questionnaire, at att. 1 (Exhibit ARG-13).

95. Siderca was aware of the broader product gr ouping of the Preston Pipe and Tube data on
22 November 2005, when Commerce placed the data on the record. This was prior to Siderca's
submission of its questionnaire response and all of its comments.

(f) Please explain why the USDOC did not use the methodology proposed by Argentina.

96. First, the methodology proposed by Argentin a before this Panel was not proposed to
Commerce during the Section 129 proceeding. Indeed, Argentina's proposal is the opposite of what
Siderca argued before Commerce during the proceedi ng. Argentina currently argues that Commerce
should have made the comparison between ca rbon and alloy PE, and carbon and alloy T&C. 88
However, during the underlying proceeding Siderca argued against making such a comparison.
Specifically, Siderca claimed that "the ten prod uct categories identified in the Department's
questionnaire are so broad they make any conclusion s drawn from the data highly doubtful, . ..." In
rebutting petitioners' counsel's proposed approach, Siderca then argued that Commerce make the
comparison on a product-category level (i.e., all OCTG).89

97. Nevertheless, Commerce did revi ew all of Siderca's data on the specific level that they were
reported – including finishing, casing/ tubing, and carbon/alloy. As e xplained in (a) above, Siderca's
extrapolated costs failed to reflect the reality of OCTG production co sts whether they were viewed on
a specific level or an aggregate level.

Q27. Please explain for what purpose the USDO C requested the cost information from the
Argentine exporters in these proceedings. Mo re specifically, please explain whether the
USDOC intended to use that information exclusiv ely for its company-specific determinations or
for its order-wide determination as well.

98. Commerce sent all Argentine producers questionna ires in order to elicit sufficient information
to make an order-wide determina tion of likelihood. While Commerce is not required to make a
company-specific determination in the absence of a waiver, Commerce does examine individual
company behaviour in order to ascertain whether dumpi ng is likely to continue or recur if the order is
revoked. Commerce requested the cost data to assi st it in evaluating the companies' behaviour over
the life of the order.

Q28. Please explain whether the USDOC init ially intended to make a company-specific
determination for Siderca as it did for Acindar, citing any evidence on record. In other words,
would the USDOC have made a company-speci fic determination for Siderca had that
company's cost data been found to be reliable?

99. Commerce requested a variety of information from respondent interested parties. Commerce
does not necessarily make company-specific dete rminations; rather, Commerce evaluates the
behaviour of respondent interested parties over the life of the order. Commerce requested the
information with a view to evaluating Sider ca's behaviour. However, as the Section 129
determination notes, the combination of the deficiencies in the cost data and Siderca's lack of
shipments during the period of review led Commerce to make no specific finding with regard to
Siderca.
90 Had Siderca's cost information been reliabl e, it would remain true that Siderca had no
shipments during the sunset period of review. Co mmerce would have weighed those facts together
before deciding whether to make any particular finding regarding Siderca.

Q29. The Panel notes that the USDOC's Section 129 Determination reads in relevant
parts:

88 Argentina's Opening Statement, at para. 57.
89 Siderca's Response to US Steel's Comments, at 5-6 (Exhibit ARG-19).
90 Section 129 Determination, p. 7 (Exhibit ARG-19).

 We disagree with Siderca's assertion that the company financial statements of
Siderca and Acindar are not relevant fo r our likelihood analysis. Financial
statements provide a good understanding of the status of the entire company, and
reflect the company's overall selling prac tices. Taken together, these data are
relevant indicators of likely future pricing trends.

(a) Would the United States agree that the USDOC's Section 129 Determination
demonstrates that some information pertai ning to Siderca, namely this company's
financial statements, were used by the US DOC in the context of its order-wide
determination?

100. The United States recalls that the purpose of a sunset review is to ascertain whether dumping
and injury are likely to continue or recur if the order is revoked. There can be many aspects to such a
determination, including aspects particular to comp anies – what their likely behaviour may be – and
more general elements pertaining to the industry as a whole – is it depressed or is it faring well.
Consideration of all aspects results in the ultimate determination.

101. In this regard, the United States would note that a company's financial statements are not
exclusively information "pertaining to" that comp any. Rather, as here, a financial statement can
provide evidence as to the condition of the industry as a whole . There were multiple sources of
information on the record concerning the condition of the OCTG industry, including the SEC filings
of domestic producers (and an assertion by Siderca itself on the record of the Section 129 proceeding).
These sources of information, taken together, along with other facts on the record, led to Commerce's
ultimate conclusion that dumping was likely to continue or recur if the order were revoked.

102. Finally, the United States notes that the p assages quoted in the question reflect a general
discussion of the potential relevance of a company's financial statements. Commerce disagreed with
Siderca's suggestion that the companies' financial statements were not relevant in making the
likelihood determination. In that context, Comme rce concluded that Siderc a's financial statement
provided information about the OCTG market generally, but Commerce did not use the financial
statement to make any company-specific finding about Siderca.

(b) Were Siderca's financial statements used as facts available or as Siderca's response to
the USDOC's questionnaire?

 Please elaborate.

103. Siderca's financial statements were used as Siderca's response to the questionnaire.

104. The United States notes that Article 6.8 provid es that in "cases in whic h any interested party
refuses access to, or otherwise does not provide, necessary information . . . determinations may be
made on the basis of the facts available." Siderca provided the financial statement. Therefore, with
respect to the financial statement, Article 6.8 is si mply not applicable. Siderca did not "refuse access
to" or "otherwise not provide" the information in question; to the contrary, Siderca provided it.

Q30. Please explain in detail whether, in your view, paragraph 3 of Annex II justified the
rejection of Siderca's cost data. In particul ar, please explain whether the cost information
submitted by Siderca was verifiable within the meaning of paragraph 3. Did the USDOC take
any steps to verify such information?

105. As the United States noted in its submissions, Article 6.8 is applicable only if facts available
are used. The United States did not make a finding with respect to Siderca, and therefore Annex II is
not applicable. The United States made that point in its first submission, and again in its second, and

Argentina has not rebutted the argument. The Unit ed States would note further that the question
appears to presume that Siderca's cost informati on was "rejected" within the meaning of paragraph 3
of Annex II. However, Commerce made its order- wide likelihood determination on the basis of its
company-specific finding regarding Acindar as we ll as evidence about the condition of the OCTG
industry, and a company-specific finding concerning Siderca was ultimately not necessary.
Therefore, Siderca's cost information was not "necessary" within the meaning of Article 6.8, and
Commerce's decision not to use the cost data was not a "rejection" of that information within the
meaning of paragraph 3 of Annex II. Rather, Co mmerce weighed all the information on the record,
and accorded greater weight to other information on the record.

106. In any event, the information was, by Siderca' s own characterization, not verifiable within the
meaning of paragraph 3 of Annex II. Siderca stated that it did not maintain its product-specific cost
data and that the data provided were extrapolat ed based on 2005 data. The problem with Siderca's
data is not that it could not be verified – Co mmerce did not contend that Siderca applied its
methodology incorrectly; however, Commerce did consider that the methodology itself was flawed,
resulting in costs that did not reflect the reality of OCTG production. While Commerce could have
verified the 2005 data, verification would not have changed the end result: Siderca's extrapolation did
not accurately reflect costs from 1995 to 2000.

Q31. The Panel notes the following part of the USDOC's Section 129 Determination:

 Although Siderca attempted to coopera te with the Department's request for
information, upon analysis of Siderca's calculations, we have identified significant
problems with its allocation of costs, with respect to both OCTG production and
all tubular production.

(a) Please explain your views about the relevance of this determination to the issue of
whether or not Siderca acted to the best of its ability in submitting its cost information to the
USDOC within the meaning of paragraph 5 of Annex II to the Agreement.

(b) Please explain how ideal the cost inform ation submitted by Siderca was within the
meaning of paragraph 5 of Annex II to the Agreement.

107. The following answers both (a) and (b):

108. As noted above, Annex II is not relevant to Commerce's Section 129 Determination because
Commerce did not use "facts available" with resp ect to Siderca – it made no determination with
respect to Siderca. As a result, the issue of whether Siderca acted to the best of its ability was not
implicated.

109. The United States further notes even when an in terested party has acted to the best of its
ability in submitting certain information, this does not mean that the investigating authority is obliged
to use the information.
91 In the case at hand, Siderca's submitted cost information was estimated cost
information based on data from October 2005, while the period considered was 1995 through 2000.

110. The cost information Siderca provided was far from ideal. For example, the contention that
alloy costs were lower than carbon costs did not make sense. Furthermore, Siderca elected to
extrapolate data based on October 2005 data – the mo st recent period available (the questionnaire was
issued 31 October 2005, and responses were due 30 November 2005). However, as Argentina noted
at the meeting of the Parties, Siderca maintains its data for 18 months. Thus, the use of information

91 Panel Report, United States – Anti-Dumping and Countervailing Measures on Steel Plate from India,
WT/DS206/R and Corr.1, para. 7.64 (adopted 29 July 2002).

the most removed from the sunset period of review furt her rendered that information even less than
ideal.

Q32.
(a) In your view, was the USDOC under an obligatio n to inform Siderca of the fact that its
cost information would not be used as we ll as to give Siderca a chance to make
comments as to why the information had to be used by the USDOC pursuant to
paragraph 6 of Annex II? If so, was the US DOC under an obligation to do it prior to
the issuance of its Section 129 Determination?

(b) Did the USDOC actually inform Siderca of this fact and give Siderca a chance to make
comments? If so, when? Did Siderca know that its cost data were not going to be used
by the USDOC in its determinations?

111. The following answers both (a) and (b):

112. As detailed in its submissions, Commerce di d not make a finding regarding Siderca, and
therefore Commerce did not make a finding regardin g Siderca on the basis of "facts available".
Therefore, Annex II is not applicable. For that reason, Commerce was not under an obligation to
inform Siderca that its information was not being used, or to provide an opportunity to provide further
explanations.

ANNEX E-3

COMMENTS OF ARGENTINA ON THE UNITED STATES'
WRITTEN ANSWERS TO QUESTIONS FROM THE PANEL
TO THE PARTIES

Argentina's Comments on US Answers to Questions 1-8

1. Argentina provides comments on the two points raised by the United States that underpin all
of the US answers to the Panel's questions on th e waiver provisions. The US arguments display a
fundamental misunderstanding of the WTO viol ation which the United States was supposed to
address in implementing the rulings and recommenda tions of the DSB. Consequently, it is not
surprising that the US arguments are misguided, unsubstantiated, or i rrelevant, and that the
US measure taken to comply regarding the waiver provisions has failed to bring the United States into
compliance with US WTO obligations.

2. First, the United States argues that it has elim inated the so called "deemed waiver" regulation,
and that the phrase in Section 751(c)(4)(A) of the Tariff Act referring to a respondent interested
party's discretion to "elect not to participate" in a USDOC sunset review only refers to the affirmative
action of filing an explicit statement of waiver by a company along with an admission that it would
likely dump in the future.
1 This position is inconsistent with the plain language of the statute, its
purpose, and the meaning that USDOC previously attached to the provis ion, as evidenced by
USDOC's former "deemed waiver" regulation itself.

3. Second, on the broader question of the WTO-cons istency of the continued operation in certain
circumstances of the statutory-mandate of Section 751(c)(4)(B) of the Tariff Act, the United States
argues that because the USDOC conducts the review on an order-wide basis, it can consider other
evidence and, therefore, it is of no consequence that the statute continues to mandate a company-
specific finding in certain instances.
2 This argument must be rejected as it fails to recognize the basic
problem with the waiver provision that was iden tified by the Appellate Body, which already has
determined that a statutorily-mandated company- specific affirmative determination will necessarily
taint any country-wide determination.3

4. Argentina's comments are elaborated below.

Meaning and Effect of "May Elect Not to Participate" in Section 751(c)(4)(A)

5. The United States argues that "electing not to participate within the meaning of
subparagraph (A) does constitute a waiver within the meaning of subsection (B)."
4 The United States
then explains that subsection (B) of the statute is now, in the wake of the revision of the waiver
regulation, triggered only by an affirmative act of pa rticipation – the filing of statement of waiver and
the submission of a statement by the waiving company that it would be likely to dump. The
US position should be rejected by the Panel for several reasons.

1 See US Answers to Panel Questions, 24 July 2006, paras. 2-12, 14-19, 21-27.
2 See US Answers to Panel Questions, 24 July 2006, paras. 13-15, 19-20.
3 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews, paras. 234-235.
4 US Answers to Panel Questions, 24 July 2006, para. 16.

6. First, United States offers no textual support from the statute. The US argument that
purportedly interprets Section 751(c)(4)(A) to only
 refer to parties that file an affirmative statement of
waiver and an admission that they would be likely to dump is a new argument and it is inconsistent
with the positions taken by the United States in th e underlying proceedings. The United States cites
no authority for the proposition that the verb "elect" in a US statute requires an affirmative statement
of waiver. The Panel should be highly suspicious of this unsupported statement and assertion. If the
United States wants this Panel to accept this new explanation of its law, the United States needs to
provide evidence in support of its assertion.

7. In fact, the very existence of the "deemed wa iver" regulation , 351.218(d)(2)(iii), which has
since been eliminated by the United States, constitu tes proof of the plain meaning of the phrase "may
elect not to participate" in Section 751(c)(4)(A) of th e Tariff Act. Indeed, the only statutory authority
that the USDOC could have relied on to issue the "deemed waiver" regulation is
Section 751(c)(4)(A). This is because Section 751( c)(4)(B) addresses only the effect or consequence
of a "waiver" i.e., circumstances where a party "e lect[s] not participate," as the United States has
admitted in its response to this question: "el ecting not to participate within the meaning of
subparagraph (A) does constitute a waiver within the meaning of subparagraph (B)."

8. Citing to certain language of the SAA, however, the United States offers for the first time in
the history of this proceeding th e argument that Section 751(c)(4 )(A) contemplates only an explicit
statement of waiver. This is nothing more than a post-hoc rationalization, and should be recognized
as such. Significantly, before this Panel during the original panel proceeding, and before the
Appellate Body, the United States did not draw any di stinction between the consequences that a party
would face if that party became subject to Secti on 751(c)(4)(B) – whether by virtue of an explicit
waiver or by virtue of that party's failure to pr ovide a complete substantive response to a notice of
initiation. For example, the US position was clearly stated in the US Appellant Submission to the
Appellate Body:

Should a respondent interested party explicitly choose to waive participation in
Commerce's sunset review proceeding or s hould a respondent waive participation by
failing to submit a complete substantive response, then pursuant to section
751(c)(4)(B), Commerce concludes that revoca tion of the order would be likely to
lead to continuation or recurrence of dumping f or that respondent. [citing 19 USC.
§ 1675(c)(4)(B)] The United States also explained that this company-specific finding
does not determine, in and of itself, the final outcome of a sunset review.
5
9. This passage is illustrative of the US pos ition throughout the underlying proceedings, in
which it never distinguished between "deemed waivers" and "affirmative waivers" for purposes of the
application of Section 751(c)(4)(B). This is beca use the United States clearly believed that whether a
respondent filed an affirmative waiv er or failed to file a complete substantive response that that
respondent party was in the class defined by Secti on 751(c)(4)(A) – those parties that "elect not to
participate" in a USDOC sunset review.

10. The approach of the USDOC in interpreting the statutory phrase in this manner is further
demonstrated by USDOC's application of Section 751(c)(4)(A) in sunset reviews. An example is
USDOC's sunset review of the antidumping duty order on Brake Rotors from the People's Republic of
China. In this review, no respondent interested parti es participated in the proceeding and none filed

5 United States – Sunset Reviews of Antidumping Measures on Oil Country Tubular Goods , DS268,
AB-2004-4, US Appellant's Submission, 13 September 2004, para. 41 (emphasis in the original).

an affirmative statement of waiver. 6 Citing only the statute, USDOC then proceeded to find that the
respondents had waived participation in the re view, even though the respondents did not file
affirmative statements of waiver:

[S]ection 751(c)(4)(B) of the Act provides th at the Department shall determine that
revocation of the order would be likely to lead to continuation or recurrence of
dumping where a respondent interested party waives its participation in the sunset
review. In this review, the Department did not receive a substantive response from
any respondent interested party.

Given that dumping margins continued to exist after the issuance of the order,
respondent interested parties waived participation in the sunset review , and absent
argument and evidence to the contrary, we find that revocation of the antidumping
order on brake rotors from the PRC would be likely to lead to the continuation or
recurrence of dumping.
7

11. In other words, contrary to the position the United States now takes before the Panel, USDOC
interpreted the statutory language – "may elect not to participate in a review" – in the conduct of
sunset reviews to apply to respondents that did not file affirmative statements of waiver and that
instead simply remained silent. That statutory language remains unchanged today.

12. The United States cites the language in the S AA to supports its new position. But, notably,
the same language in the SAA was used previous ly by the Commerce Department as its support for
the "deemed waiver" provisions of the regulations. In other words, USDOC's consistent position has
been that through this same language in the SAA, Congress and the Administration intended to allow
USDOC to interpret silence from an exporter to tr igger the provisions of the statute regarding the
"election" not to participate. The United States cannot credibly argue now that this same passage –
with no change to the statute and no further indication of Congressional intent – supports the view that
the statutory term "elect" requires an affirmative statement of waiver and an admission of likely
dumping by the foreign exporter. The US position is simply not serious.

13. Finally, it should be noted that the United States has offered no rebuttal to the fact that under
US law, the terms of a statute will be controlling in the event of a conflict with an inconsistent
implementing regulation. As Argentina has argued, under US law, a US statute will prevail over a
US regulation where the two measures are inconsistent.
8 In addition, although an agency such as the
USDOC may promulgate regulations pursuant to au thority granted by Congress, that agency cannot
through the promulgation of a regulation confer on itself any greater authority than that conferred
under the governing statute.
9 Accordingly, where the statute mandates a specific action (e.g., making
an affirmative company-specific likelihood determ ination), the statute cannot be overridden by
USDOC's modification of an implementing regulatio n. Consequently, notwithstanding an expression
of how USDOC would implement the waiver provis ions or regulatory text to the contrary, the
operation of the statute nonetheless continues to op erate in a manner inconsistent with US WTO
obligations. Section 751(c)(4)(B) directs a compan y-specific finding of likelihood for any respondent

6 Brake Rotors from the People's Republic of China, 67 Fed. Reg. 45458, 45459 (9 July 2002) (attached
as Exhibit ARG-38) USDOC noted th at it "did not receive a substan tive response from any respondent
interested party in the proceeding[,]" and did not reference any affirmative statements of waiver. Id.
7 Brake Rotors from the People's Republic of China; Final Results Issues and Decision Memorandum
at 6-7 (ARG-38).
8 See Argentina's Second Submission, para. 164 and note 161.
9 See Argentina's Second Submission, para. 164 and note 162.

interested party that "elect[s] not to participat e" in the USDOC sunset review, and is therefore
inconsistent with Article 11.3 of the Anti-Dumping Agreement.

Operation of Section 751(c)(4)(B) and Tainting of Order-Wide Determination

14. It is undisputed that, once the waiver provision of the statute is triggered, the USDOC must
make a company-specific determination that the waiv ing respondent is likely to dump. The responses
from the United States do not disagree with this assertion.
10

15. Also, the Appellate Body already has dete rmined that a company-specific affirmative
determination taints the count ry-wide determination. The Appellate Body found that
Section 751(c)(4)(B) and its implementing regulation we re inconsistent, as such, with US obligations
under Article 11.3 of the Anti-Dumping Agreement:

Because the waiver provisions require the USDOC to arrive at affirmative company-
specific determinations without rega rd to any evidence on record, these
determinations are merely assumptions made by the agency, rather than findings
supported by evidence…. [E]ven assuming that the USDOC takes into account the
totality of record evidence in making its order-wide determination, it is clear that, as a
result of the operation of the waiver provisions, certain order-wide likelihood
determinations made by the USDOC will be based, at least in part, on statutorily-
mandated assumptions about a company's lik elihood of dumping. In our view, this
result is inconsistent with the obliga tion of an investigating authority under
Article 11.3 to "arrive at a reasoned conclusion" on the basis of "positive evidence".

Therefore, we uphold the Panel's findings...that Section 751(c)(4)(B) of the Tariff Act
of 1930 and Section 351.218(d)(2)(iii) of the USDOC Regulations are inconsistent, as
such, with Article 11.3 of the Anti-Dumping Agreement.
11

16. In fact, the passage above is the Appellate Bo dy's rejection of the same arguments that the
United States recycles for this Panel. As is ev ident from the above, the US position that a country-
wide determination is made on the basis of the totality of the circumstances and all the evidence
gathered already has been considered and rejected by the Appellate Body. The Appellate Body was
not persuaded that this explanation removes the ill egal tainting of the country-wide determination.
This Panel need not revisit that conclusion nor accept the United States' second attempt to avoid the
consequences of the statutorily mandated findings.

Argentina's Comments on US Answer to Questions 10(a), (b)

17. In Questions 10(a) and (b) the Panel asks th e United States specifically "whether the USDOC
intended to, and the extent to which it did, determ ine whether these exporters actually dumped in the
period of review …." In response the United States answers that: (1) it did not intend to determine
whether these exporters actually dumped in the period of review,
12 but (2) that it did in fact make a
determination that Acindar likely had dumped.13

10 See US Answers to Panel Questions, 24 July 2006, paras. 13-15, 19-20.
11 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews, paras. 234-235.
12 See US Answers to Panel Questions, 24 July 2006, para. 26 (the United States, referring to the
Section 129 proceeding, states: "Nor did Commerce seek to establish the existence of dumping") and para. 28
("Commerce did not intend to determine whether the Argentine exports to the United States were dumped
during the period of review").
13 See US Answers to Panel Questions, 24 July 2006, para. 31 ("Commerce concluded that it was likely
that Acindar had dumped during the life of the order").

18. The answer by the United States is puzz ling, contradictory, and unnecessarily ambiguous
given the clear statements USDOC made in the Section 129 Determination, and the United States
made in its written submissions to this Panel. For example:

• In the Section 129 Determination, the United States explains: "Based upon the
foregoing, and in the absence of usable cost date from Acindar, we find that Acindar
likely was dumping subject OCTG during the original Sunset review period."
(ARG-16, page 7).

• In the US First Submission to this Panel, the United States explains: "The Panel
found that the fact that dumping duties continued to be collected on imports over the
life of the order did not represent 'an ad equate factual basis for the proposition that
dumping continued ' during the period 1995-2000."
14 Therefore, Commerce
collected additional evidence on this matter.

• In paragraph 38 of the US First Submission, the United States is even clearer in its
contradiction of its current position: "Commerce sought to evaluate whether dumping
continued over the life of the order."

19. The position that the United States explains in its answer to the Panel's direct question is not
the position that it took previously. The Panel must make its assessment based on the Department's
actions and statements in the Section 129 determin ation, not the post hoc rationalizations provided
now.

20. The answers offered by the United States to this question contain ot her contradiction and
inaccurate statements that Argentina would like to co rrect. First, the United States indicates that "…
none of the Argentine producers maintained their pr oduct-specific cost data," and that "had the
Argentine producers been able to report their actua l product-specific cost information, it could have
been verified by tying the cost back to the financial statements."
15 The companies obviously retained
product-specific costs. The problem was that USDOC requested the product-specific costs for a
period extending 5-10 years prior to the request. Therefore, the problem is not a failure to maintain
product-specific costs, it is a problem of the USDOC 's failure to request the information in 2000,
when it was required to make its prospective determination at that time.

21. Also, the suggestion that the information could not be "verified by tying the costs back to the
financial statements" is wrong a nd unsupported. In fact, in the Questionnaire, the Department
required a reconciliation of the cost information to the financial statements. Siderca provided such a
reconciliation. The USDOC did not verify the info rmation, which is a result of its own decisions
regarding the substance and procedure of the Section 129 Determination. The USDOC cannot choose
to forego a verification, and then simply assert that the information could not be verified. As Siderca
explains in its comments to the response of th e United States to Question 30, the Questionnaire
instructions indicated that the information had to be verifiable, and Siderca prepared and presented the
information consistent with those instructions.

22. Second, the United States makes a series of contradictory and, in the end, unsupportable
references to the notion of home market viability and how it affected the USDOC's decisions about
what questions to ask the exporters. In the subs tantive meeting of the parties, the United States
indicated that it decided not to request home mark et or third country sales information from the
exporters because it knew from a s ubsequent, post-sunset review th at Acindar had no sales in the

14 US First Submission, para. 35 (footnote omitted).
15 US Answers to Panel Questions, 24 July 2006, paras. 25, 26.

Argentine market. In its response to the Panel's questions, the United States echoes this explanation
in one portion by saying, "Aware that Acindar, the only exporter, had no home market or third
country sales, Commerce drafted the questionnaire with the intention of asking questions that
Respondents could actually answer, and therefore requ ested the product-specific cost data to provide
an estimate of the normal value."
16

23. There are a few problems with this explanati on. First, it makes clear that the Department
relied on information that did not exist at the time of the sunset review, and that it did not learn until
after the sunset review. This information could not possibly support a 2000 decision to continue the
measure; the information did not even exist then.

24. Second, If USDOC wanted information regard ing any Acindar home market sales during the
sunset review period, it should have asked for that information in the Section 129 proceeding, rather
than relying on "knowledge" or "awareness" that it gained about Acindar after the sunset period.
Notwithstanding this important point, the Governme nt of Argentina also understands that the post-
sunset "awareness" that the United States has describe d to this Panel is factually inaccurate. In the
verification report from the USDOC's first review of Acindar (a document dated 27 August 2002; that
is, two years after the close of the sunset period), the USDOC explains that Acindar did have some
home market sales of OCTG during the 2000/01 period reviewed in that case, and the USDOC
reviewed the specific invoices related to those sales.

25. Finally, the United States creates more contra dictions when it tries to explain its decision
making at the time of issuing its Questionnaire. The United Stares explains that "Commerce drafted
the Questionnaire with the intention of asking ques tions that the Respondents could actually answer
...."
17 The United States further adds that counsel fo r US Steel asserted that the Argentine exporters
did not have a viable home market, and implies that this was an additional basis for the Department's
decision not to request home market sales information. 18 The obvious problem with this explanation
is the timing. USDOC sent its questionnaire to the Argentine exporters on 31 October 2005
(ARG- 13), while the letter from counsel for US Steel was filed on 2 December 2005 (ARG-27).
Obviously, assertions by counsel for US Steel, and Siderca's rebuttal of those assertions, could not
possibly explain the decision that the Department made when it "drafted the Questionnaire" several
weeks earlier.

26. The responses by the United States to questions 10(a) and 10(b) seem to reflect the answers
that the United States believes that the Panel wants to hear, rather than the answers that reflect the
reality of USDOC's conduct of the Section 129 proceedi ng. As a result, the United States enters into
contradictions of explanations it has provided to th is Panel and, more importantly, of the explanations
it provided in the Section 129 Determination, which is the measure taken to comply.

Argentina's Comments on US Answer to Questions 11(a), (b), (c)

27. The Panel asks a series of questions regardi ng the definition of dumping found in Article 2.1
as it relates to the obligations of Article 11.3. Th e answers by the United States to these questions are
unsatisfactory.

28. The answers begin with more contradictions . The United States indicates that "Commerce
concluded that it was likely that Acindar had dumped during the life of the order."
19 It should be
recalled that the United States explained that US DOC did not intend to make any such finding.

16 US Answers to Panel Questions, 24 July 2006, para. 25.
17 US Answers to Panel Questions, 24 July 2006, para. 25.
18 See US Answers to Panel Questions, 24 July 2006, para. 25, note 26.
19 US Answers to Panel Questions, 24 July 2006, para. 31.

(See response to Questions 10(a) and (b) above). The Department then states in response to
Question 11(b), that "Commerce did not determine the existence of or degree of dumping during the
Sunset period of review ….". 20

29. Argentina submits that these two statements cannot both be correct. The United States clearly
indicates in its Section 129 Determination that it c oncluded that the existence of dumping by Acindar
was "likely" during the review period. Therefore, it is simply wrong for the United States to contend
in paragraph 33 that it made no determination as to the existence of "dumping" during the sunset
period. It did make such a determination, but unab le to show that "dumping" existed, it stated that
"dumping" likely existed.

30. The United States also introduces a new argument and a new justification for its actions in the
Section 129 Determination, explaini ng that USDOC acted consistently with paragraph 7 of Annex II
to the Anti-dumping Agreement, because that provision refers to "other independent sources" as
including "published price lists, official import statistics and Customs returns."
21 However, the
United States seems to forget that the intent of paragraph 7 of Annex II is to explain what "other
independent sources" can be used when an exporter is asked specific questions and fails to respond .
Notably, these other sources of information could be used by an authority if it asks the exporter for
normal value and export price information, and the e xporter does not provide that information. As is
well established in this case, the USDOC never even asked for that information.

31. It is also evident from the reference that the United States is grasping for straws at this point.
To suggest that the "published price lists" referred to in paragraph 7 of Annex II provides support for
USDOC's use of average pricing data in the importing country as a surrogate for normal value is not
serious. The references have a much clearer, logical meaning. For example, if an exporter does not
provide its export prices or its home market prices, then it would be acceptable for the authority to
rely on the published price lists that would tend to s how what the exporters pri ces are in its export or
home market. Similarly, the reference to "official import statistics and Customs returns" are logical
when one considers that they could be used as a surrogate for export price if the exporter does not
provide transaction-specific information regarding its exports, or, potentially as a surrogate for third
country price where the exporter does not provide that information. No reasonable interpretation of
paragraph 7 of Annex II would justify the use of Cu stoms data when the auth ority never even asked
the exporter for this information, or US market data as a surrogate for the exporter's normal value.

Argentina's Comments on US Answer to Question 12 (a)

32. In paragraph 36, the United States includes a statement that is fundamental to the
disagreement between the United States and Argentina in this dispute. Explaining that Siderca had
stopped shipping after imposition of the order and th at a new entrant into the United States "had
appeared anonymously" during the sunset review period without participating in USDOC's sunset
review proceeding, the United States describes that it was in a difficult position and looking for
answers. According to the United States: "The answer cannot be the one advocated by Argentina –
that a lack of shipping activity, or a failure to make oneself known, necessarily requires a negative
determination as to what would happen if the order were revoked."
22

33. Argentina submits that the answer for which th e United States was searching lies in the text of
Article 11.3. The answer provided by Article 11.3 is that the Member must terminate the
antidumping measure after five years, unless a determination of likely dumping and injury can be
made based on positive evidence. What is absolutely clear fro m the United States' answer to

20 US Answers to Panel Questions, 24 July 2006, para. 33.
21 US Answers to Panel Questions, 24 July 2006, para. 31.
22 US Answers to Panel Questions, 24 July 2006, para. 36.

Question 12 is that it never considered the possibility of termination. In fact, it is adamant that "the
answer cannot be the one advocated by Argentina."

34. Argentina also notes that it is not, of c ourse, arguing that a negative determination is
"necessarily required." But, Argentina would agr ee that in cases where there is no evidence that
revocation of the order would likely lead to continuation or recurrence of dumping, the answer must
be termination. Article 11.3 says so.

35. The United States makes the statement that "t he investigating authority must do what it can
with the information it has, including the in formation submitted – or not submitted – by the
Respondents."
23 Argentina asks that the Panel be diligen t in evaluating this and other statements
made by the United States in this Article 21.5 pr oceeding. The United States obviously is trying to
blur the line between what occurred in the original sunset review in 2000 and what occurred in the
Section 129 proceeding. The latter is the proceeding leading to the Section 129 determination, which
is the measure taken to comply. There is simply no basis to suggest that the Argentine exporters
failed to provide information or failed to cooperate in any manner in the Section 129 proceeding.
Argentina asked the United States to clarify these in questions in 13 and 14, but the United States
declined to respond. As to the requested cost in formation, both exporters e xplained, and no one has
disputed, that the exporters could have provi ded this information to the USDOC had USDOC
requested it in the original sunset review proceeding. Thus, when the United States complains of the
"limited amount of information, attributab le entirely to the Respondent's own choices," 24 the Panel
must be careful not to be fooled into thinking that USDOC's hands were tied in the Section 129
proceeding and that USDOC could do nothing more th an what it did. It clearly could have done
more, but it made choices, and a lot of assumptions, in order to find a way to justify continuing the
measure. As the United States made clear the "answer cannot be the one advocated by Argentina."

Argentina's Comments on US Answer to Question 12(b)

36. In Question 12(b), the Panel asks the Unite d States to address the differences in physical
characteristics of the products compared and wh ether these factors were known to the USDOC and
taken into account in the Section 129 proceeding. The answer, particularly in paragraph 41, is a series
of unsupported statements that prove that Commerce knew, but chose to ignore, that these differences
affected the comparison of OCTG products. Also, the United States continues to make assertions that
have been proven through this proceeding to be incorrect. We address each of these below:

37. The following sets forth US statements in paragraph 41 of its answers, followed by
Argentina's comments:

• Referring to the Preston Pipe & Tube Report, the United States asserts: "Its
segregation of tubing from casing also addressed much of the size concern Argentina
now raises as tubing is a small tubular pr oduct in limited sizes and casing is larger
size material. Even in the comparison Ar gentina raised during the Panel hearing,
Argentina conceded that there is minimal overlap in sizes between tubing and
casing."

o The statement that the distinction between tubing and casing sufficiently
addresses the effect of size on the cost of producing OCTG is absolutely
unsupported. Further, Argentina made no such concession in the hearing. To
the contrary, Argentina provided one example which disproves the point made
by the United States. It was an exampl e of a 4 ½ inch outside diameter OCTG,

23 US Answers to Panel Questions, 24 July 2006, para. 36.
24 US Answers to Panel Questions, 24 July 2006, para. 36.

which the evidence established could be so ld as either casing or tubing. That
one example shows that the tubing/casing classification cannot be relied upon
to sufficiently account for the differen ce in cost caused by the size of the
OCTG products. There are many other examples in which certain sizes of
tubing are more similar to casing than to other tubing, and also many examples
of casing that is more similar to tubing than other casing.
25 It is simply wrong
for the United States to continue to assert these factually incorrect statements.
In addition to being unsupported a nd wrong, it is also clear that none of this
analysis that the United States offers now was done during the Section 129
Determination. USDOC simply assumed these facts (which, in fact, are
wrong) and went forward with its impr oper comparisons (both the comparison
of alloy to carbon costs, and the comparison of Acindar's exports compared to
Preston Pipe categories).

• The United States also states that "Additionally, though the Preston Pipe & Tube
Report does not distinguish between end finish (e.g., plain end vs. threaded and
coupled), the universe of material included in the carbon welded tubing and carbon
welded casing groups does include both plai n end and threaded and coupled material,
diminishing any impact this may have on the price comparisons."

o This, too, is completely unsupported, and was never part of the Section 129
Determination. And the statements are illogical. The problem is that both
types of end finish pipe are included in the Preston Pipe & Tube Report, but no
one knows the relative volume of each end finish within the category. Given
that plain end and threaded and coupled OCTG have different costs,
26 the
inclusion of both end finishes in no way can be said to "diminish [] any impact
this may have on price comparisons." Rather than diminishing the impact, it
simply blurs the picture so that the comparisons are less reliable.

• The United States next addresses the problem of transportation costs: "With respect
to transportation costs, we note that not all of the Preston Publishing selling prices
included transportation costs. The Pres ton Pipe data included both domestic and
import shipments. The terms of the latter were fob mill."

o The United States is finally conceding th e issue that it does not know what is
included in the prices reported in Prest on Pipe & Tube Reports. Even with
respect to transportation costs, it has to concede that the Preston Pipe & Tube
Report prices contain some unknown ble nd of domestic and imported prices,
some with and some without the transportation costs included, and with no idea
of the amount of any transportation costs. Added to the inability to control the
physical characteristics, this concession regarding the terms of sale associated
with the average product grouping prices further undermines the reliability of
the comparison the Department performed to determine that Acindar likely was
dumping during the period.

25 See ARG-34 (4 ½ inch case (page 6) are more simila r to 3 ½ and 4 ½ inch tubing (page 11) than the
larger casing. Such as all the casing produced at US Steel Lorain Ohio plant (10 ¾ inch and higher) (page 9) .
Please note that the page number references are to the hand-written page numbers in the upper right hand corner
of ARG-34.
26 This has been adequately established on the reco rd of this proceeding: Argentina showed that in
some cases the differences in price for a plain end and T&C OCTG can be $250 per ton; Siderca's cost
information also shows, at the product group level, the differences in cost for end finishing.

• The United States then adds: "Even had Commerce been able to adjust for these
factors, Acindar's sales prices were so fa r below the US average prices that the end
result would likely have not changed."

o There is no factual support for this stat ement. In fact, the United States has
claimed confidential treatment for the import prices used in its comparison, and
the Panel indicated in the substantive meeting of the parties that it was not
inclined to investigate the degree to which the AUVs from the Customs data
were lower than the Preston Pipe Report data. Without this information, the
Panel can give no weight to this unsu pported statement by the United States
that Acindar's prices were "so far belo w" the average market prices. Also,
despite the statements by the United States to the contrary, this statement seems
to demonstrate that it is making a dete rmination regarding the existence of
dumping.

38. In paragraph 42, the United States notes th at Exhibit ARG-34 and Exhibit ARG-35 "were not
on the record of the Section 129 proceeding," and suggests that the Panel therefore cannot consider
this information. The United States misses the obvious fact USDOC bears the responsibility for the
failure of this information to be on the record of the Section 129 proceeding. In fact, one of
Argentina's Article 6 claims is that the United Stat es had an obligation to disclose to the parties the
types of comparisons it was making, and the assumpti ons it was applying to the cost data that it
ultimately rejected. Had the Depa rtment made these disclosures, th e Argentine exporters could have
disproved all of these statements in the Section 129 proceeding, just as Argentina is doing before this
Panel. As Argentina explained in its submissions a nd in its Oral Statement, the Article 6 claims are
inextricably linked to the substantive Article 11. 3 claims: USDOC had an obligation to develop
positive evidence that dumping was likely to continue or recur if it sought to continue the measure. It
failed to do this in the Section 1 29 Determination, and the United St ates complaint in paragraph 42 is
additional proof of this failure.

39. In paragraph 43, the United States moves to its alternative argument and introduces more new
facts. It states: "Even if the Panel were to consider the facts introduced here, and not in the
Section 129 Determination, the price lists included therein are for seamless OCTG yet Acindar sold
only welded OCTG – a product with a very different cost and price structure. Furthermore, a price
list is not the actual price arrived at for the sale. In fact, discounting of price lists was common
practice during the period because of the depressed condition of the OCTG market." The comment
misses the point and again shows the deficiencies of the review conducted by the USDOC. The price
list was referred to during the Oral Statement for two purposes; to show the price difference of a
plain end and threaded and coupled OCTG, and as evidence of the cost difference of the pipe. Thus,
it is easy to see that the evidence re lates to the cost of producing a particular end finish on a pipe
(compared to no end finish, or plain end), and the co mmercial value that is added by that processing.
Therefore, whether the pipe itself is welded or seamless is does not bear on the issue. Also, there is
obviously no factual basis for the statement that "discounting of price lists was common practice
during the period."

40. In paragraph 44 the United States offers its own analysis of the data and purports to show that
Argentina has understated the price difference be tween carbon and alloy OCTG. In doing so, the
United States seeks to rebut an argument that Argentina did not make. Argentina never said that the
cost of producing all carbon OCTG is within 10 per cent of all alloy OCTG. In fact, Argentina was
very precise with respect to its statement, quotin g specific prices from the price list. But, in
attempting to rebut the point, the United States on ly serves to highlight the deficiencies of its
comparisons. It states, correctly, that "there are a multitude of alloying grades …" which "will reflect
a composite of these alloy grades." The "multitude " and "composite" nature of these comparisons

goes precisely to the point Argentina has made since the beginning of the Section 129 proceeding. By
relying on comparisons at such a general level, the USDOC could not reach the specific conclusions
that it made during the Section 129 proceeding.

41. The United States ends with the conclusory st atement that "Commerce analyzed the evidence
on the record before it, which was sufficiently specific to enable a basic comparison on Acindar's
prices to the prevailing market prices." Obviously, it was not sufficiently specific, which is precisely
the point of many of Argentina's concerns and the Panel's questions.

Argentina's Comments on US Answer to Questions 13 and 15

42. Questions 13 and 15 address several issues regarding the USDOC's use of financial
statements in the Section 129 proceeding. In genera l, the answers provided by the United States as to
the use of the financial statements are consiste nt with Argentina's understanding, as described in
Argentina's response to the Questions 13 (a) and (b) of Argentina's response to the Panel's questions.

43. However, Argentina would like to draw the Pa nel's attention to two particular aspects of the
US response. First, in response to Question 13, the United States points to a number of excerpts to the
financial statements of several parties (the Argentine exporters and US producers) to support its
statement that the OCTG was depressed at certain points in time. Argentina agrees that the statements
support this assertion. However, the Panel should not forget that the United States made a specific
finding that there was no indication of improvement in the OCTG market. USDOC referred to this
finding in two specific contexts: (1) as an add itional reason why Acindar was likely to dump in the
future;27 and (2) in interpreting the condition of the OCTG market.28

44. The financial statements quoted by the United States in response to Question 13(a) all
contradict the Department's findings. All of them reference, to one degree or another, the "recovery"
that began to appear at the end of 1999 and had continued into 2000. The United States tries to save
the situation by pointing to the cautious language in the financial statements indicating that no
assurance can be given regarding the "timing and exte nt of such recovery," which are normal, prudent
statements through which management indicates to inv estors that they should not rush to judgment.
However, the financial statements are unanimous in reporting the beginning of the recovery that the
USDOC indicated was nowhere on the horizon.

45. The United States tries to reconcile all of this in its response to Question 15, indicating that
"because of price volatility, price trends alone, in this particular industry, are not necessarily reliable
or sufficient to indicate true market recovery. Commerce did not consider a slight increase in prices
at the end of the period a sufficient indicator of a lasting shift in the demand for OCTG that had
been depressed for the majority of the period."
29 While this language is more measured and perhaps
more prudent, it is not the language that was used in the Section 129 Determination, in which the
USDOC stated that there was an absence of evidence that "prevailing market conditions were likely to
improve in the near future." 30 Also, injecting the new terms "true market recovery" and the
requirement for a "lasting shift in the demand for OCTG" does little to help reconcile the difference

27 USDOC stated: "absent evidence that Acindar in tended to cease selling in the United States, and
absent evidence that prevailing market conditions were likely to improve in the near future , we consider such
sales indicative of Acindar's likely pricing behaviour were the order to be revoked." ARG-16, page 8.
28 USDOC stated: "given the weakened condition of Si derca at the end of the original Sunset review
period, we consider that there was no valid indication that a sudden turn-around in the OCTG was likely ."
ARG-16, page 10.
29 US Answers to Panel Questions, 24 July 2006, para. 66.
30 USDOC Section 129 Determination at 8 (ARG-16).

between the Department's findings in the Secti on 129 Determination and the evidence from all the
financial statements -- all of which concur that a recovery was underway.

46. In its response to Question 15 (b), the Unite d States provides a new analysis to support its
notion that the recovery that appeared at the end of the period was not reliable. It should be obvious
to the Panel that the new analysis cannot possi bly justify the decision in the Section 129
Determination because it was not, by definition, part of that analysis. Also, the analysis using
selected prices from the general Preston Pipe categories suffers from the same problems that have
been explained several times: each product cate gory contains an unknown mix of products, and the
mix may be different from month to month. Therefor e, the fact that the average price for the group
carbon ERW tubing in January was $762 and fell in Febr uary to $759, as reported in the new analysis
done by the United States in paragraph 63, does not mean that the recovery is faltering. It could just
mean that there was a different mix of products within the carbon ERW tubing category sold in
January and February. The same can be said for a ll of the small differences in the comparisons that
the United States introduces in paragraph 63 of its answers.

Argentina's Comments on US Answer to Question 14(a) and (b)

47. The Panel asks the United States to react to Argentina's statement that, with respect to
whether "dumping" occurred in the past, the authority can either determine that it did, determine that
it did not, or concede that it does not know. Rather than give a direct answer, the United States once
again returns to the concept of "likely past dumpi ng" and contends that "Argentina seems to assume
that inferences cannot be drawn about the past. However, Argentina does not explain why that is
true."31

48. Argentina has repeatedly offered explanations, grounded in the text of the Anti-Dumping
Agreement, why it is impermissible to base on Article 11.3 determination on an inference, that itself is
based on yet another inference of likely past dumping.

49. The US answer ignores these explanations a nd repeats the refrain that the provisions of
Article 2 of the Anti-Dumping Agreement and the definition of "dumping" are not relevant to
Article 11.3 determinations. According to the Unit ed States "nothing in the text of Article 11.3
requires an investigating authority to determine that dumping occurred in the past or to conclude that
it does not know whether dumping occurred in the past."
32

50. While the United States preference is for Article 11.3 to be free from disciplines, it is not.
The word "dumping" has a specific meaning in Article VI of the GATT 1994 and in the Anti-dumping
Agreement, and the Appellate Body already has clarified that the meaning of "dumping" in
Article 11.3 is the same as the meaning of the term in Article 2:

[T]he words "[f]or the purpose of this Agre ement" in Article 2.1 indicate that this
provision describes the circumstances in which a product is to be considered as being
dumped for purposes of the entire Anti-Dumping Agreement, including Article 11.3.
This interpretation is supported by the fact that Article 11.3 does not indicate, either
expressly or by implication, that "dumping" has a different meaning in the context of
sunset reviews than in the rest of th e Anti-Dumping Agreement. Therefore,
Article 2.1 of the Anti-Dumping Agreement and Article VI:1 of the GATT 1994
suggest that the question for investigating authorities, in making a likelihood
determination in a sunset review pursuant to Article 11.3, is whether the expiry of the
duty would be likely to lead to continuation or recurrence of dumping of the product

31 US Answers to Panel Questions, 24 July 2006, para. 54.
32 US Answers to Panel Questions, 24 July 2006, para. 55.

subject to the duty (that is, to the introdu ction of that product into the commerce of
the importing country at less than its normal value).33

51. Consequently, if USDOC is going to infer likely "dumping" from some past action, that past
action must be probative of "dumping." "Dumping" has a specific meaning under the Anti-Dumping
Agreement, and that meaning is contained in Artic le 2. Even though the USDOC is not required to
calculate a dumping margin in an Article 11. 3 review, the requisite likelihood of dumping
determination must be related to the concept of "dumping" that is defined in Article 2.

52. As explained above in its comments to the US responses to question 11, the United States
tries to straddle two different positions regarding its finding of "likely past dumping": "Commerce
concluded that it was likely that Acindar had dumped during the life of the order,"
34 and "Commerce
did not determine the existence of . . . dumping during the Sunset period of review …." 35 T h e
United States tries to maintain this dubious distin ction in its response to Question 14 (b), where it
states in different places of the same answer th at: "Simply because Commerce used the term 'likely
dumping' to describe its findings … does not mean that Commerce determined the existence of
dumping…" and that Commerce concluded that "Acindar had likely dumped during the period." 36
These two statements are irreconcilable, especially in the same answer.

53. Also, repeating a theme that appears often in the responses, the United States explains that
"Commerce had to rely upon US average unit values as a type of surrogate for normal value out of
necessity because there were no other reliable data."
37 But, as should be clear at this point in this
proceeding (and the United States does not dispute), Commerce never asked for any other such data,
and the Argentine exporters did not know that Commerce was planning to use US average unit
values as a "type of surrogate for normal value."

54. As a result of these flaws with the USDOC's approach on two key points that form the basis
for its decision – the "likely past dumping" and the inference of likely continued dumping in the
future – the Department failed to establish a suffi cient factual basis, and did not reach a reasoned
conclusion.

Argentina's Comments on US Answer to Question 16

55. In this question, the Panel asks the United States to comment on Argentina's assertion that
OCTG prices were significantly higher in the United St ates than in other market s. In response to the
question, the United States asserts that "Comme rce made no such finding, and Argentina has not
identified the information on the record to which it was referring." 38 The United States is wrong on
both counts.

56. First, the US statement is contradicted by the Section 129 Determination (ARG-16) at 11,
where the USDOC states:

We also note that the ITC's finding that OCTG producers had incentive to devote
more of their productive capacity to producing and shipping more to the US market
was sustained by the Appellate Body.

33 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 109.
34 US Answers to Panel Questions, 24 July 2006, para. 30.
35 US Answers to Panel Questions, 24 July 2006, para. 33.
36 See US Answers to Panel Questions, 24 July 2006, paras. 57, 60.
37 US Answers to Panel Questions, 24 July 2006, para. 58.
38 US Answers to Panel Questions, 24 July 2006, para. 67.

57. Thus, USDOC specifically refers to the ITC' s finding in its Section 129 determination, and
also to the Appellate Body's approval of the re asons why the USITC believed that OCTG producers
had an incentive to increase sh ipment quantities to the United States. The USITC found that
US market prices were significantly higher than world market prices and this Panel upheld USITC's
affirmative determination noting, among other things , that the US price of OCTG during the review
period was significantly higher than the price of OCTG in other markets.
39 The passage in the Section
129 Determination indicates that USDOC was also aware of this fact and "noted" the fact in rendering
its decision.

Argentina's Comments on US Answer to Questions 17(a) and (b)

58. Argentina agrees with the United States that the Panel exercised judicial economy with
respect to the volume issue. (See also Argentina' s answer to this question). However, the United
States is incorrect when it asserts that Argentin a was required to appeal the Panel's exercise of
discretion as "false judicial economy," or abandon its right to have the issue considered on the merits.

59. The flaw in the argument put forward by th e United States is its refusal to acknowledge that
the Panel already had found that USDOC's 2000 sun set determination violated Article 11.3.
Therefore, in order to bring itself into complian ce with the rulings and recommendations of the DSB,
the United States would either have to revoke the measure or justify the continuation based on some
further determination. Any furthe r determination would be subject to review under Article 21.5, and
the Panel would be required to review all stated b ases of that decision in order to determine whether it
was consistent with Article 11.3. Thus, the exercise of discretion by the Panel was not false judicial
economy because the Panel had already disposed of th e matter by finding a violation of Article 11.3,
and any future determination seeking to justify c ontinuation of the measure would have to comply
with Article 11.3.

60. The Panel should reject the US assertion th at Argentina "disregards the rulings and
recommendations [of the DSB] and appears to be asking the Panel to treat this proceeding as if it were
an original proceeding… this is not an orig inal proceeding – it is a compliance proceeding."
40 The
continued reliance by the United States on the EC – Bed Linen (Art. 21.5 – India) decision is
misguided. In addition to the explanation previ ously provided by Argentina, Argentina agrees with
the points raised by the Eu ropean Communities that the EC – Bed Linen (Art. 21.5 – India) case was
factually and legally very different from the present case. As the EC noted:

In the present case… the focus of the judicial review is on one specific determination
– that of likelihood of continuation 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
redetermination can only have been based on a consideration of all of these factors,
taken together and that, accordingly, all of those factors necessarily fall within the
scope of this Panel's review under Article 21.5 of the DSU.
41

61. As for the jurisprudence related to the exercise of judicial economy, the Panel in the
US – Steel Safeguard summarized key principles as follows:

The principle of judicial economy is recognized in WTO law. In US – Wool Shirt and
Blouses, the Appellate Body made clear that pa nels are not required to address all the
claims made by a complaining party. The Appellate Body relied on the explicit aim of

39 See Panel Report, paras. 7.291, 7.297.
40 US Answers to Panel Questions, 24 July 2006, para. 70.
41 EC Third Party Oral Statement, 13 July 2006, para. 20.

the dispute settlement mechanism which is to secure a positive solution to a dispute
(Article 3.7) or a satisfactory settlement of the matter (Article 3.4). Thus, the basic
aim of dispute settlement in the WTO is to settle disputes and not to develop
jurisprudence. The Appellate Body stated:

"[G]iven the explicit aim of dispute settlement that permeates the DSU, we do
not consider that Article 3.2 of the DSU is meant to encourage either panels
or the Appellate Body to 'make law' by clarifying existing provisions of the
WTO Agreement outside the context of resolving a particular dispute. A panel
need only address those claims which must be addressed in order to resolve
the matter in issue in the dispute."
42

62. The Panel in US – Steel Safeguards had exercised judicial economy with respect to a number
of claims, reasoning that because it had found the safeguard measures to inconsistent under other
provisions, there was no need for the Panel to ex amine the measures under other cited provisions.
The Panel found that that it had "effectively resolved the dispute" since the measures were "deprived
of a legal basis."
43

63. Similarly, the effect of the Panel's findi ngs in this case was that USDOC's 2000 sunset
determination was inconsistent with Article 11.3. Accordingly, Argentina believed then, as it
continues to believe now, that the United States woul d either have to revoke the measure or make a
new determination, and any new determination would be subject to the same temporal and substantive
obligations of Article 11.3.

64. Finally, the Panel should dismiss the US conten tion that were the Panel "to make an adverse
finding now" on the USDOC's volume analysis, "the United States would have no reasonable period
of time to bring its measure into conformity w ith the Antidumping Agreement and would be subject
to potential suspension of concessions as a result of a finding of breach that was not in the original
report."
44 As to the possibility of facing suspension of concessions, this is a consequence of the WTO
dispute settlement system. The United States has been on notice since the original Panel finding that
its continuation of the antidumping measure did not comply with US obligations under Article 11.3.
The United States was further aware that, if it wanted to continue the measure, it would need to make
a new determination that is fully consistent with Ar ticle 11.3. By choosing continue the measure, and
by choosing to rely on volume as one of the fi ndings supporting the new determination supporting
continuation, the United States placed itself in the po sition that it describes. Also, the United States
also clearly had the option of not relying on volume. The United States does not even assert this
position before this Panel, but this surely would have been the easiest way for the United States to
have avoided the purported "inequity" that would arise by any adverse ruling on the volume analysis.

65. Also, the United States response fails to rec ognize any inequity for Argentina. Argentina
explained the inequities that it would suffer in its response.
45

66. The inequities that would be suffered by Argentina are in no way abstract or hypothetical. In
fact, they are already starting to materialize. Just last week, the USDOC released its adequacy
determination in the second sunset review, which is attached as Exhibit ARG-39. In that decision,
and despite a response by Siderca and facts on th e record that the only other producer, Acindar,

42 Panel Report, US – Steel Safeguards, para. 10.701 (quoting Appellate Body Report, US – Wool Shirt
and Blouses).
43 Panel Report, US – Steel Safeguards, para. 10.705.
44 US Answers to Panel Questions, 24 July 2006, para. 73.
45 See Argentina's Answers to the Panel's Questions, paras. 69-74.

stopped producing OCTG in 2001, USDOC found Siderc a's response "inadequate" and determined to
expedite the sunset proceeding. The reason? Volume.
46

67. The newly-released decision proves the inequ ities that Argentina will suffer if this Panel
decides not to resolve the matter before it, in all its aspects, in cluding the volume inference that
USDOC expressly relied upon to make its Section 129 determination. It also is more compelling
evidence as to why this Panel should exercise its di scretion to "suggest" that the United States should
terminate the measure, if the Panel finds that the United States has not brought itself into compliance.
Any other decision by this Panel will not help resolve the matter, as th e USDOC seems intent on
repeatedly invoking the "exception" of Article 11.3, despite a lack of evidence of likely dumping.

Argentina's Comments on US Answer to Questions 17(c)

68. The Panel should reject the US response that USDOC's "volume analysis" was "part of the
original determination" and was "s imply reincorporated into the redetermination" and therefore "the
United States was not obliged to reconsider that analysis to implement the recommendations and
rulings of the DSB."
47

69. First, the United States has not disputed th at the Section 129 Determination is a "measure
taken to comply" for the purposes of this DSU Article 21.5 proceeding. Second, the USDOC
specifically relied on the inference of likelihood of dumping arising from its findings on import
volumes from the original sunset review as a basis fo r 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. Finally, EC – Bed Linen (Art. 21.5 – India) does not support the US position.

70. 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.48 The Section 129 Determination is clear that USDOC

46 The USDOC document alleges an apparent contradiction in Siderca's position. There is no
contradiction at all. Siderca's substantive response ex plained that: 1) Acindar stopped producing OCTG in
2001, the first year of the second sunset period; and 2) that Siderca's affiliate, SIAT, purchased Acindar's tubular
production assets in 2005, so that Siderca and its aff iliates were the only known OCTG producers in Argentina
at this time. In a pattern that will be familiar to this Panel, USDOC made no attempts to clarify any doubts that
it had, assumed the worst, and issued a decision adverse to Siderca. The action demonstrates a continuation of
the lack of objectivity USDOC displayed in the 2000 sunset proceeding and in the Section 129 determination.
Siderca did not export, therefore its response could not be adequate.
47 US Answers to Panel Questions, 24 July 2006, para. 78.
48 See USDOC Section 129 Determination at 1 (ARG-16) ("[W]e solicited and considered information
and argument from domestic and respondent 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
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.")(e mphasis added); 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 wo uld be likely to lead to continuation or recurrence of
dumping.") (emphasis added); see also USDOC Section 12 9 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).

"relied on our previous finding regarding the vol ume of imports" as a basis for the Section 129
Determination.49

71. It is well established that it is not up to the implementing party to decide the scope of
jurisdiction of an Article 21.5 panel.50 In Canada – Aircraft, the Appellate Body stated that:

[I]n carrying out its review under Article 21.5 of the DSU, a panel is not confined to
examining the "measures taken to comply " from the perspective of the claims,
arguments and factual circumstances that related to the measure that was the subject
of the original proceedings. Although th ese may have some relevance in proceedings
under Article 21.5 of the DSU, Article 21.5 proceedings involve, in principle, not the
original measure, but rather a new and di fferent measure which was not before the
original panel. In addition, the relevant facts bearing upon the "measure taken to
comply" may be different from the relevant facts relating to the measure at issue in
the original proceedings. It is natural, therefore, that the claims, arguments and
factual circumstances which are pertinent to the "measure taken to comply" will not,
necessarily, be the same as those which were pertinent in the original dispute. Indeed,
the utility of the review envisaged under Article 21.5 of the DSU would be seriously
undermined if a panel were restricted to examining the new measure from the
perspective of the claims, arguments and factual circumstances that related to the
original measure, because an Article 21.5 panel would then be unable to examine
fully the "consistency with a covered agreem ent of the measures taken to comply", as
required by Article 21.5 of the DSU.
51

72. By expressly relying on its original finding on volume, the USDOC placed these findings
within the scope of the "measures taken to comply" fo r the purposes of this Section 21.5 proceeding.
After having stated expressly in its implementi ng 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 take n to comply." This Panel cannot permit the
United States to determine unilaterally which parts of the measures taken to comply can be examined
in the course of this proceeding.

73. Furthermore, to permit the United States to set the Panel's scope of review would prevent the
Panel from determining the WTO-consistency of one of the US implementing measures. The
USDOC did not simply confirm its "original consid eration" of the finding on volume. Rather, the
USDOC relied on this finding for the separate and i ndependent purpose of further supporting 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.

74. EC – Bed Linen (Art. 21.5 – India) does not support the US position, and the facts of that case
differ in a key respect. India's claim that the EC violated Article 3.5 of the Anti-Dumping Agreement

49 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).
50 See, e.g., Appellate Body Report, US – Softwood Lumber IV (Article 21.5 – Canada) , para. 73
("A Member's designation of a measure as one taken 'to comply', or not, is relevant to this inquiry, but it cannot
be conclusive. Conversely, nor is it up to the complaining Member alone to determine what constitutes the
measure taken to comply. It is rather for the Panel itself to determine the ambit of its jurisdiction.").
51 Appellate Body Report, Canada – Aircraft, para. 41.

by failing to ensure that injuries caused by "other factors" was not attributed to the dumped imports
was dismissed because India failed to make a prima facie case. India did not appeal that finding.
When the EC implemented the DSB rulings, it did not revise the analysis of "other factors" made in
the original determination. As the Panel noted, "[t]he EC did not … undertake a reconsideration of
the "other factors' identified by India. Rather, it referred to and confirmed its original consideration of
these factors."
52 Also, as the EC noted in its Third Party Oral Submission:

In the present case… the focus of the judicial review is on one specific determination
– that of likelihood of continuation 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 w ith Argentina that the Article 11.3 re-
determination can only have been based on a consideration of all of these factors,
taken together, and that, accordingly, all of those factors necessarily fall within the
scope of this Panel's review under Article 21.5 of the DSU.
53

75. EC implementing regulation in Bed Linen demonstrates that the Council indeed simply
confirmed its initial determination, rather than rely on such findings for the purpose of its "measure
taken to comply." Each of the sections dealing with "effects of other factors" consist of a single
sentence. The section on "Imports from third countries" states simply that: "[t]he findings in recitals
100 and 101 of the provisional Regulation remain unaffected."
54

76. In United States – Investigation of the International Trade Commission 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.
55

77. As Argentina has argued throughout this pro ceeding, 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 ad judicated in the first instance, un like the first and third scenarios
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 ma ke any finding regarding this point so it is simply
wrong to state that the issue has been decided.

Argentina's Comments on the US, Answer to Question 18

78. The United States contends that "Siderca's comments explaining the decline in import
volumes were not germane to the US implementation of the recommendations and rulings of the DSB,
which pertained to Commerce's reliance on the dumpi ng margin from the original investigation, and
not to Commerce's volume analysis."56

52 Panel Report, EC – Bed Linen (Art. 21.5 – India), para. 72.
53 EC Third Party Oral Statement, para. 20 (footnote omitted).
54 See Argentina's Second Submission, paras. 94-98.
55 Appellate Body Report, US – Lumber ITC Investigation (Article 21.5 – Canada) , para. 102, n. 150
(citations omitted).
56 US Answers to Panel Questions, 24 July 2006, para. 79 (original emphasis).

79. The US position on what was necessary for the United States to achieve compliance in this
case is directly at odds with its obligations under Ar ticle 11.3. The US view is also explicit in the
USDOC Section 129 Determination, in which the United States seeks to insulate the volume inference
from review in the compliance proceeding based on th is Panel's decision to refrain from deciding the
issue in its first review.57

80. In 2005, as in 2000, the USDOC has again failed to go behind the volume decline and
examine further the reasons for the reduction in OCTG import volume after the imposition of the
order. The fact that the Panel may have exer cised judicial economy on the propriety of USDOC's
volume inference does not mean that the USDOC' s finding was WTO-consistent. The Appellate
Body has clearly articulated that it would be legally insufficient under Article 11.3 for the
administering authority to simply presume lik elihood based on a post-order volume decline.
58 With
respect to the probative value of declining import volumes for the purposes of an Article 11.3
determination, the Appellate Body has clarified that the authority must undertake "a case specific
analysis of the factors behind a cessation of imports or a decline in import volumes… will always be
necessary to determine that dumping will recur if the duty is terminated."
59 In US - OCTG from
Mexico the Appellate Body confirmed that it would viol ate Article 11.3 for an authority to rely on
presumptions or conjecture as to a company's ability to ship to the US market without dumping.60

81. The Panel's question highlights a portion of Siderca's response:

Whatever the significance of a decline in export volume may be as a general matter,
Siderca knows that, with respect to Siderca, it does not mean that the product could
not be shipped without dumping. The cost data (even with the limitations explained
above) supports Siderca's position: Siderca is a cost-efficient producer of OCTG and
could have shipped OCTG products profitably to the United States.
61

82. As the passage highlighted by the Panel mak es clear, Siderca's information clearly was an
attempt to demonstrate that the d ecline in volume was not related to the inability of the company to
participate in the US market without dumping. The Argentine exporters explained the reason for the
volume decline during the sunset period of revi ew, established that Acindar was only a minor
producer, and demonstrated that Siderca had divers ified its export markets after the imposition of the
order and that the company performed quite well without exporting to the US market.
62

83. The USDOC's 2005 likelihood determination does not even address these arguments, which
explained the reason for the reduction in Argentine OCTG imports into the United States. Nor does
the United States even attempt to offer a response that addresses the specific language identified in the
Panel's question. Instead, the United States retreats to the familiar refrain that "Siderca's comments
[on volume] were not responsive to the question asked."
63 Siderca's information relating to the
volume decline, however, was unquestionably "responsive" to the questions that USDOC had to
analyze to bring the United States into compliance with its obligations under Article 11.3.

57 USDOC Section 129 Determination at 2 n.4 and 6 n.12 (ARG-16).
58 Appellate Body Report, US - Corrosion-Resistant Steel Sunset Review, para. 177.
59 Appellate Body Report, US - Corrosion-Resistant Steel Sunset Review, para. 177.
60 Appellate Body Report, United States – Anti-Dumping Measures on Oil Country Tubular Goods
(OCTG) from Mexico, WT/DS282/AB/R. adopted 28 November 2005, para. 199 ("US – OCTG from Mexico").
61 Panel Question 18 (quoting Siderca's 30 November 2005 Response).
62 See Siderca's Response to Questionnaire (30 Nov. 2005) at 7-10 (ARG-15).
63 US Answers to Panel Questions, 24 July 2006, para. 79.

84. Thus, the USDOC's failure to consider Side rca's information and arguments regarding the
reasons for the volume decline cannot be reconciled w ith the Appellate Body's admonishment that "a
case-specific analysis of the factors behind a cessation of imports or a decline in import volumes
(when dumping is eliminated) will be necessary to determine that dumping will recur if the duty is
terminated."
64 The Appellate Body in Mexico OCTG reaffirmed this obligation expressly and again
cautioned against the "mechanistic" use of presumpti ons in relying on volume declines, noting that a
"company's strategy and ability to increase or decr ease its exports to particular markets depend on a
variety of market conditions, such as, in particular, the opportunities available in different markets and
the competitive conditions in the market place. Ther efore, unless all relevant factors are taken into
account, there may not be an objective evaluation in such cases of the causes of the variations in
import volumes in the importing Member's market."65

85. The USDOC Section 129 Determination states: "Declining import volumes after, and
apparently resulting from, imposition of an antidumping duty order indicate that exporters would need
to dump to sell at pre-order levels."
66 The statement shows that the USDOC is still making
assumptions rather than reasoned decisions based on positive evidence. There is no factual basis for
the US assumption, either in the 2000 Sunset Determination or in the 2005 Section 129
Determination. Instead, the USDOC relies on what "apparently" is the case, and what an exporter
"would need" to do. This type of conjecture, without f actual basis, does not satisfy the requirements
of Article 11.3.

Argentina's Comments on the US, Answer to Question 20

86. Despite the US assertion that "Commerce took [Siderca's comments from its 7 December
letter] into consideration in its analysis,"67 the USDOC did not address the basic due process concerns
that Siderca had raised.

87. Siderca's 7 December 2005 Letter to the USDO C expressed key concerns and indicated that
there was significant uncertainty as to the proce dures for comment and precisely what information the
Department would be relying on for purposes of its Section 129 determination. Because the USDOC
did not respond, the Argentine companies were precluded from knowing the essential facts and
information that would serve as the basis for DOC's analysis and, hence, also were prevented from
being in a position "to present in writing all evidence which they consider relevant in respect of the
investigation in question," as required by Article 6.1. In failing to respond to the due process
concerns raised by the Argentine companies, and to identify the information that would be used by
USDOC in its decision making, the USDOC also deprived the Argentine respondents of a "full
opportunity for the defence of their interests" as required by Article 6.2.

88. The failure of USDOC to respond to these con cerns demonstrates that the United States failed
to discharge the due process and transparency obliga tions that are central to Articles 6.1 and 6.2 and
which ensure that interested parties are in a pos ition to defend their interests by having "full" and
"ample" opportunity to defend their interests.

Argentina's Comments on the US, Answer to Question 21(b)

89. Argentina notes that the United States qualif ies its answer with the phrase "notwithstanding
the limited time available."
68 Argentina does not agree that the wo rd "practicable" requires this Panel

64 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 177.
65 Appellate Body Report, US - OCTG from Mexico, paras. 200-201.
66 USDOC Section 129 Determination at 11 (ARG-16) (emphasis added).
67 US Answers to Panel Questions, 24 July 2006, para. 83.
68 US Answers to Panel Questions, 24 July 2006, para. 84.

to take into account the fact that the United States conducted its Secti on 129 determination under a
shorter time frame. In general terms, what is "p racticable" for the purposes of Article 6.4 will need to
be determined on a case-by-case basis. However, fo r the specific purpose of this case, the Panel can
readily reject the argument that reduced time frames renders compliance with Article 6.4 somehow
"impracticable." As Argentina has argued, all WTO obligations apply on a concurrent and
overlapping basis. The United States was required to comply with its obligations under Article 6.4
while concurrently complying with its obligation under Article 21.3(c) to bring its measures into
conformity with its WTO obligations in the short est period of time possible - which the Arbitrator
determined to be twelve months.

90. Also, the obligations of Article 6.4 must be read in context. This context includes other
provisions of the Anti-Dumping Agreement, most notably Articles 11.3 and 11.4.

91. The United States reference to the fact that one of the five
 memoranda dated
16 December 2005 "consisted of respondent and domes tic interested parties' submissions in the
original sunset review" 69 completely misses the point. By virtue of being issued contemporaneously
with USDOC's Section 129 Determination, the USDOC failed to "provide timely opportunities for all
interested parties to see" any of the five memoranda, which were clearly "relevant to the presentation
of their claims."

92. Finally, supporting the contention that USDOC "disclosed the reasoning as soon as
practicable," the United States asserts that "C ommerce received Siderca's rebuttal of IPSCO's
arguments on the cost data as on 14 December 2005. The memoranda on the deficiencies in the cost
data were released just two days later, on 16 December 2005."
70 This is disingenuous. The
United States picked the date the last comments were submitted on Siderca's cost data. Yet, as early
as 30 November 2005, the USDOC was aware that ther e could be a problem, and could have at this
time to advise the parties of information that was "relevant to the presentation of their claims."

Argentina's Comments on the US, Answer to Question 24

93. Argentina would note that access by a fore ign respondent's legal counsel to confidential
documents under an APO does not discharge US obliga tions under Article 6.5.1. Article 6.5.1 uses
plain language: "The authorities shall require inter ested parties providing confidential information to
furnish non-confidential summaries thereof." If the dr afters of the Agreement wanted to provide that
access by counsel would excuse a Member from comply ing with this clear obligation, they could
easily have provided for that. They did not do so.

94. Moreover, even assuming arguendo that access by counsel could constitute a form of
compliance with Article 6.5.1, this access would have to be granted in a manner that fulfils the due
process purpose of this provision. Indeed, the very ne xt sentence of Article 6.5.1 states that: "These
summaries shall be in sufficient detail to permit a reasonable understanding of the substance of the
information submitted in confidence."

95. That "reasonable understanding," in turn, is requi red to enable the responding parties to assert
their due process rights under the Agreement. In the present case, Siderca's legal counsel obtained
copies of the proprietary documents identif ied in the Section 129 Determination, only after the
Determination had been issued. Providing coun sel access to confidential information in this ex post
facto manner serves no purpose, and obviously renders meaningless the due process intent of
Article 6.5.1.

69 US Answers to Panel Questions, 24 July 2006, para. 85.
70 US Answers to Panel Questions, 24 July 2006, para. 86.

Argentina's Comments on US Answer to Question 26(a)

96. The response by the United States in 26(a) is , again, filled with inaccurate statements and
factual assertions that simply have no basis in the Section 129 proceeding. For example:

• The United States correctly states that it c onsidered the fact that non-OCTG costs
were significantly higher for OCTG products. 71 The United States then indicates:
"this was an unexpected result because Sider ca had been a large producer of standard
line pipe – a lower value-added product – and thus these non-OCTG costs should
have been lower."72 This statement again confirms that the Department was acting on
assumptions and intuition about what Siderca's costs should show, without any factual
basis. As Siderca has explained in its written submissions to the Panel and in the
substantive meeting of the parties, there is nothing wrong with the notion that non-
OCTG products have a higher cost than OCTG . To the extent that the USDOC
expected that it should always be the case, it was simply wrong.

• The United States adds to the mistake by asserting now new facts which also were not
developed during the Section 129 proceeding. Siderca is not a large producer of
standard line pipe ,73 and there is no support in the record of the Section 129
proceeding that it is. As the Department must know, Siderca is a producer of
seamless tubular products , and the market for seamless standard pipe is extremely
small. As Argentina pointed out in its first written submission, seamless standard
pipe is not a high-demand product, and it is inconceivable that anyone who knows the
tubular products market would assert that Siderca produces a high volume of this
product. In any event, there is no factual b asis whatsoever for this statement, and the
United States continues to disregard Argentina's rebuttal of this specific point.
74

• The United States also asserts that USDOC found that "Siderca had reported lower
costs for [an alloy product than for the corresponding carbon product]. That is a
result that should not occur."
75 Again, the comment demonstrates what the
Department believes "should" occur, without any factual basis whatsoever. Argentina
has explained before to this Panel in it s written submissions that making decisions on
the basis of these untested assumptions is directly contrary to the Article 11.3
obligation, and to the due process requirements of Article 6. The Argentine exporters
never knew that USDOC expected that alloy products would always be more
expensive to produce than carbon products. In fact, as Argentina has argued, and as
Siderca could have explained in the c ourse of the proceeding had it known this
comparison was being contemplated, much depends on the product mix. For
example, within the ten categories, OCTG with a small outside diameter would
generally require more machine time than OCTG with a large outside diameter.
Therefore, the per ton processing costs of the smaller product would generally be
much higher than the per ton processing costs of the larger product. If the small
product is carbon, while the larger produc t is alloy, the smaller carbon product may
have a higher per ton production cost than the larger alloy product because the

71 US Answers to Panel Questions, 24 July 2006, para. 90, first sentence.
72 US Answers to Panel Questions, 24 July 2006, para. 90, second sentence.
73 The reference to "standard line pipe" is ambiguous. There is "standard pipe" and there is "line pipe",
but Argentina and Siderca are unaware of which the United States means when it says "standard line pipe."
Again, there are no facts on the record to support the proposition, regardless of what the United States meant by
this statement.
74 See Argentina's First Submission, para. 91 and note 71.
75 US Answers to Panel Questions, 24 July 2006, para. 90.

additional processing costs per ton due to the size of the product might offset the
higher material cost resulting from the use of the alloys in the larger product. Again,
this explanation should have occurred in the Section 129 proceeding; it did not
because Siderca did not know that the USDOC was performing these comparisons
and measuring the costs against certain unexplained, unrevealed "assumptions."

• The United States then offers its own price comparison, selecting March 1998, and
concluding that the price of carbon seamless casing reported in Preston Pipe that
month was $192 per ton less than then alloy seamless casing during the same month.
But, we already know that the Preston Pipe does not distinguish between end finishes,
and that end finishes affect the price and cost of a product. And, the United States
also has admitted that the USDOC could not know the effect of transportation costs in
these prices, as that would depend on the mix of imported and domestic mill
shipments in the averages at any particular time. Therefore, the price difference that
the United States calculates establishes not hing more than the following: In the
month of March 1998, for the mix of products sold as carbon seamless casing and
alloy seamless casing, both with various, unknown end finishings, sizes, weights,
lengths, and freight costs, the average pr ice difference of the two groupings was
$192/ton. Attempting to infer from observati on that alloying products will always be
more expensive than carbon products to pr oduce is highly suspect and would lead to
inaccurate conclusions.

• The Department concludes with a statement, "Regardless of whether the data is
reviewed on a broader level or a more specific level, the costs did not reflect the
reality of OCTG production." This conclu sory statement reveals the problems with
the two comparisons performed by the Depa rtment of Commerce. The Department
considered itself to be in a better position to know the "reality of OCTG production"
than the producers. Therefore, it made assumptions (some demonstrably incorrect)
and made decisions about the reliability of data based on those assumptions. That is
not consistent with the obligation of Artic le 11.3 or the due process obligations of
Article 6.

97. Finally, in paragraph 91, the United States observes that in some months the difference
between the costs of alloy and carbon products are ve ry small, even when co mpared with the same
end finishing. Again, there is no evidence from the Section 129 Determination that USDOC ever
performed this comparison. In fact, the documents show that it did not: the Department calculated
weighted averages of the threaded and plain end pro ducts before performing the comparisons. In any
event, the size of the difference in any particul ar month will depend on the precise product mix within
the groupings. End finishes and the steel grade used are two of the factors, but as Argentina has
consistently explained, other factors, such as out side diameter, wall thickne ss, range, all affect the
specific costs. In the end, it is the Department that is making the assumption that alloy products are
always more expensive than carbon products; it cannot criticize exporters for showing that, in any
given month, the cost of the products being reported do not conform to USDOC's untested
assumptions.

Argentina's Comments on US Answer to Questions 26(d)-(f)

98. In subparts (d)-(f), the Panel asks specific qu estions to the United States regarding the
comparisons performed in the Section 129 Determinati on. Argentina refers the Panel to Argentina's
24 July answer to Question 26(c). In Argentina's an swer to this question, Argentina explains that
USDOC performed two different comparisons for tw o different purposes: (1) a comparison intended
to test the theory that the alloy should be more expensive than the carbon product, and (2) to

determine whether Acindar was likely dumping in the past.
76 Comparison 2 is the only comparison
involving the Preston Pipe categories.

99. In its responses to Subparts (d)-(f), the United St ates continues to blur the distinction between
these two comparisons in the hope of making its actions sound reasonable. For example, the
United States explains that it requested that the pr oducers provide costs and that they distinguishing
between plain and threaded and coupled OCTG, but "because Commerce later found that the Preston
data did not create discrete categories for plain- end and threaded and coupled, Commerce had to
modify those categories when it conducted its analysis."
77 This is clearly wrong, and a mixture of the
two comparisons. The Preston data was irrelevant to comparison number 1 -- i.e. , whether Siderca's
costs were reliable, which USDOC tested by using only Siderca data. The Preston data has nothing to
do with comparison 1. Clearly, the United States is mixing up the comparisons here.

100. The United States does the same thing later wh en it claims that Siderca has been taking
different positions. According to the United Stat es: "Argentina currently argues that Commerce
should have made the comparison between carb on and alloy PE, and carbon and alloy T&C.
However, during the underlying proceeding, Siderca argued against making such a comparison…. In
rebutting Petitioners' counsel's proposed approach , Siderca then argued that Commerce make the
comparison on a product-category level, (i.e.
, all OCTG)."78 The following should be obvious at this
point:

• Argentina's position has been that, for comparison 1 (to determine the cost
relationship of producing carbon and alloy products), the comparison should have
been made between product groupings with th e same end finish so as to attempt to
isolate the effect of the steel grade factor (to use the example in the quotation, carbon
and alloy PE should have been compared to carbon and alloy T&C). Siderca's
position in the Section 129 proceeding coul d not possibly have contradicted this
position because USDOC never informed any of the parties that it was performing
comparison 1, so that Siderca never knew that this comparison was underway.

• Siderca's arguments in the Section 129 Determination against "making such a
comparison" refer to comparison 2 – that is, trying to determine dumping by
comparison at a broad product category level.

• The United States is distorting the record when it states that Siderca was arguing for
Commerce to make comparisons on a product-cat egory level. It makes this statement
several times in its responses to answers, evidently trying to create the impression that
it is true. When the Panel examines the source document for this claim (ARG-19), it
will see that Siderca was not arguing for this particular comparison; it was merely
pointing out the deficiencies of the doing comparisons along the lines of the ten
product categories, and arguing against any comparisons on such a general level.

Argentina's Comments on the US, Answer to Questions 27 and 28

101. The US answers to the questions 27 and 28 hi ghlight the inconsistency in the US position on
Siderca's cost information, and reveal a results or iented approach to the Section 129 Determination.
The United States asserts that the USDOC "requested the cost data" from the Argentine producers "to
assist it in evaluating the companies' behaviour over the life of the order." 79 Once Siderca provided

76 Argentina's Answers to Panel Questions, 24 July 2006, para. 137.
77 US Answers to Panel Questions, 24 July 2006, para. 94.
78 US Answers to Panel Questions, 24 July 2006, para. 96.
79 US Answers to Panel Questions, 24 July 2006, para. 98.

cost information, however, and that cost inform ation generated results that USDOC did not expect,
the USDOC rejected or (to use the US phrase, "did not consider") Siderca's information because, the
United States asserts, "the combination of deficiencies in the cost data and Siderca's lack of shipments
during the period of review led Commerce to make no specific finding with regard to Siderca."80

102. The US position that USDOC could properly re ject/not consider Siderca's information is
based on two factors. First, that USDOC made no findings regarding Siderca. Second, because an
Article 11.3 determination is made on "an order-wide basis," the United States implies that it already
had a sufficient basis for its "country-wide" determina tion (the finding regarding Acindar's likely past
dumping, and the inference arising from the volume dec line) so that it was free to disregard Siderca's
information.
81

103. Argentina has provided extensive rebuttal as to the evidentiary sufficiency and WTO-
consistency of these bases for the Section 129 Determ ination. The information provided by Siderca
certainly was relevant to USDOC's Article 11.3 de termination. Information provided by the major
producer in the country is, by definition, relevant to a "country-wide" determination of whether future
exports are likely to be dumped.

104. Siderca provided both cost information in response to the USDOC's questions, and
information regarding its comme rcial and production operations fro m its financial statements.
82 The
cost data was germane because it is the informat ion that the USDOC chose to develop. That
information was necessarily part of the evidentiary basis that the USDOC chose to develop to make
its Section 129 Determination. The cost data is the information requested by the USDOC and Siderca
provided information to the best of its ability, a fact which has not been disputed. In addition, Siderca
explained to the USDOC that the data supported the view that Siderca would not be likely to dump in
the future, as it showed that Siderca had achieved cer tain efficiencies even in difficult market times
and was able to sell its products at above its cost of production. 83 In other words, this was positive
evidence that the major Argentine pro ducer was able to sell at prices th at exceeded its costs, and that
its production efficiency had increased throughout the sunset period.

105. Simply because Siderca's information is not what USDOC expected does not mean that it can
be disregarded, or that it is not germane to the aut hority's determination. Of course, if the information
is inaccurate, an authority could be excused from cons idering the information. But, inaccuracy of the
data is something that needs to be demonstrated , which did not occur in this case for the reasons
explained. Similarly also relevant was the othe r information that Siderca provided (commercial and
production information based on its fi nancial statements). This information provided the context for
understanding the volume decrease (which was not rela ted to an inability to ship without dumping),
and also contained information that contradicted the USDOC's finding that the record contained no
information of a turnaround in the OCTG market.
84

106. In the end, as demonstrated by the US answers and the bases underlying the Section 129
Determination, the US position can be reduced to the following point: there is no positive evidence
that Siderca, the major Argentine OCTG producer, was dumping or would be likely to dump. In the
event that the authority can find no positive evid ence with respect to the major producer, the
obligation of Article 11.3 is not satisfied when the authority simply asserts that it will make "no
finding." In such a case, Article 11.3 requires termination of the measure because the conditions

80 US Answers to Panel Questions, 24 July 2006, para. 99.
81 US First Submission, para. 44.
82 Siderca's Response to Questionnaire (ARG-15).
83 Siderca's Response to Questionnaire at pages 2-10 (ARG-15).
84 Argentina's First Submission, para. 99 (referring to USDOC Section 129 Determination (ARG-16)
at 9-10).

necessary for continuing the measure on the basis of a determination supported by positive evidence
have not been satisfied.

Argentina's Comments on US Answer to Question 30

107. The United States makes the incredible asserti on that Siderca's cost information "was, by
Siderca's own characterization, not verifiable w ithin the meaning of paragraph 3 of Annex II." 85
Argentina has already explained that Siderca was in structed to provide verifiable data, and that
Siderca did so. In fact, the Department requested a reconciliation of the cost data to the financial
statements, and Siderca reconciled that cost data to the financial statements of each year during the
period of review.86 Siderca also explained in its response to criticisms by one of the representatives of
the US industry that the reconciliation had been prepared so that it would tie to the financial
statements of the company for each year. 87 Thus, it is simply wrong for the Department to say that
this information was not verifiable, or that Siderca had characterized it as such.

108. The United States also repeats it s statement that the costs "did not reflect the reality of OCTG
production."
88 This is essentially an admission that the United States continues to rely on assumptions
about the "reality of OCTG production" rather than develop information that could be debated by the
parties, who are the experts in OCTG production. Finally, the United States ends with the incredible
statement that "while Commerce could have veri fied the 2005 data, verification would not have
changed the end result: Siderca's extrapolation did not accurately reflect the cost for 1995 to 2000."
It is hard to imagine a statement more revealing of pre-judgment. In fact, all of the cost data was
verifiable. A statement by the United States that verification would not have mattered because it
would not have changed USDOC's preconceived notions is not an objective assessment of the record.
In fact, the verification could have shown that the USDOC was incorrect in its assumptions.

Argentina's Comments on the US, Answer to Questions 31 (a) and (b)

109. The United States continues to assert that "A nnex II is not relevant to Commerce's Section
129 Determination because Commerce did not use 'facts available' with respect to Siderca – it made
no determination with respect to Siderca."
89 The Panel should reject the US position.

110. The United States seeks to elevate form over subs tance in an effort to avoid the disciplines of
Article 6.8 and Annex II. However, the fact th at the United States did not use the phrase "facts
available" cannot be dispositive in this case. Si milarly unavailing are US statements that USDOC
simply did "not consider" Siderca's, or Sider ca's information was not "germane" or that USDOC
"made no determination with respect to Siderca." None of these efforts to cloak USDOC's failure to
apply the disciplines of Article 6.8 and Annex II should convince the Panel otherwise.

111. There is no textual support for a narrow reading of the Agreement where Article 6.8 and
Annex II would apply only to information that supports the conclusions of the investigating
authorities, but not to information that contradicts or detracts from its conclusions.

112. In this case, there is no basis to debate th e applicability of paragra ph 3 of Annex II. This
provision requires the administering authority "take into account" for purposes of its determination
"all information which is verifiable , which is appropriately submitted so that it can be used in the
investigation without undue difficulties." The cost information submitted by Siderca was "verifiable"

85 US Answers to Panel Questions, 24 July 2006, para. 106.
86 See ARG-15, Annex 5.
87 See ARG-29, pages 4-5.
88 US Answers to Panel Questions, 24 July 2006, para. 106.
89 US Answers to Panel Questions, 24 July 2006, para. 108.

within the meaning of paragraph 3. The inform ation provided by Siderca was verifiable, and was
appropriately submitted. Siderca's letter to the USDOC, dated 14 December 2006, page 4,
(ARG-29), confirms that Siderca was fully prepared to have its cost data verified and that the "data
has been reconstructed using cost reports from th e same production lines and cost centres used to
produce OCTG during the period. Information on the cost of operating the lines during the 1995-
2000 period is available, was used by Siderca, and would be available for verification if the
Department so chose. The Department indicated in its questionnaire that Siderca should use verifiable
data, and Siderca confirms that it heeded this advice."

113. The USDOC did not use Siderca's information on the basis of purported "inconsistencies" and
"methodological discrepancies." USDOC did so without asking Siderca to clarify these purported
problems or without giving Siderca an opportunity to remedy the purported deficiencies. Moreover,
Argentina has demonstrated that the Department's purported substan tive rationale for rejecting the
cost data is flawed and that USDOC could have read ily used Siderca's cost information in the Section
129 proceeding without "undue difficulties." Consequently, the USDOC was therefore required under
paragraph 3 of Annex II to take su ch information into account in its Section 129 determination, but it
failed to do so. As the Panel clarified in US – Steel Plate from India , a decision by an administering
authority to reject information provided by an ex porter, where that decision "lacks a valid basis under
paragraph 3 of Annex II of the AD Agreement," will result in an violation of the requirements of
Article 6.8 and paragraph 3 of Annex II.
90

Argentina's Comments on the US, Answer to Questions 32(a) and (b)

114. The US response to this question follows the same pattern that "Annex II is not applicable,"
that USDOC "did not make any finding regarding Si derca on the basis of 'facts available'" and that
USDOC was under "no obligation to inform Siderca" that its cost information would not be used.91

115. Argentina invites the Panel to review Arge ntina's comments above re garding the US answer
to Question 31, which are equally relevant for purposes of the US answers to question 32.

116. In addition, Argentina would address specifically the obligations of paragraph 6 of Annex II,
which was the subject of the Panel's question and which the United States did not address. In the
circumstances of this case, the USDOC acted incons istently with US obligations under the provisions
of paragraph 6 of Annex II.

117. Central to the Panel's finding of a violati on of Article 6.8 and Annex II, paragraph 6 in Egypt
– Rebar from Turkey, was the investigating authority's failure to inform the respondent parties of
certain deficiencies and provide them with a chance to provide clarification or further explanations.
The Panel concluded that "Egypt violated Article 6. 8 and Annex II, paragraph 6, in respect of [the
respondent exporters], because the [investigating authority], having identified to these respondents the
information "necessary" to verify their cost data, and having received that information, nevertheless
found that the respondents had failed to provide "necessary information."
92 The Panel in that case
faulted the investigating authority because it did no t "inform these companies of this finding and did
not give them an opportunity to provide further explanations."

118. The circumstances of USDOC's Section 129 pr oceeding and its treatment of Siderca's cost
information are no different. USDOC clearly was unde r an obligation to inform Siderca of the fact
that its cost information would not be used by the USDOC for purposes of the Section 129
Determination.

90 Panel Report, US – Steel Plate from India, WT/DS206/R, para. 7.79.
91 US Answers to Panel Questions, 24 July 2006, para. 112.
92 Panel Report, Egypt – Rebar from Turkey, WT/DS211, para. 7.266.

119. The conduct of USDOC is especially troubling given that Siderca attempted to provide the
data as it was requested by the USDOC. If US DOC had concerns regarding the information
submitted by Siderca, USDOC was required to provi de Siderca with an opportunity to provide
comments as to why the information should not de disregarded by the USDOC. This opportunity
should have been available to Siderca prior to th e issuance of its Section 129 Determination, and the
USDOC file memoranda that contained the anal ysis and information regarding the purported
"inconsistencies" and "methodological discrepancies.

ANNEX E-4

COMMENTS OF THE UNTIED STATES ON ARGENTINA'S
ANSWERS TO THE QUESTIONS FROM
THE PANEL TO THE PARTIES

WAIVER PROVISIONS

Q1. The Panel notes that Argentina argues, and the United States does not contest, that the
US law requires the USDOC to make its ultimate sun set determinations on an order-wide basis.
Please explain whether this is the case and, if so, cite the relevant provisions of the US law
(including regulations and/or policy provisions) which require the US investigating authorities
to make their sunset determinations on an order-wide basis and provide copies thereof.

1. Rather than answer the question posed by th e Panel, Argentina argues that the United States
has failed to bring its statutory and regulatory wa iver provisions into conformity with the DSB's
recommendations and rulings. As the United St ates has previously explained, Commerce's
modification of its sunset regulations eliminates the possibility that Commerce's order-wide likelihood
determinations would be based on assumptions a bout likelihood of continuation or recurrence of
dumping due to respondent interested parties' waiver of participation in sunset reviews.
1

2. Argentina's interpretation of section 751(c )(4)(B) of the Tariff Act – that the statute
"mandates a certain outcome" – is simply incorrect.
2 The only action required by section 751(c)(4) of
the Tariff Act is that Commerce make an affirmative company-specific likelihood finding as a
consequence of a party choosing to submit a waiver – the contents of which are prescribed by the
sunset regulations. Specifically, section 351.218(d)(2)( ii) of the sunset regulations provides that a
party choosing to submit a waiver must include a statement that it would be likely to dump if the order
were revoked. Thus, a company-specific likeli hood finding under section 751(c)(4)(B) of the Tariff
Act would only be a consequence of a party's admi ssion that it is likely to dump if the order were
revoked.

3. Contrary to Argentina's assertions, failure of respondent interested parties to participate in a
sunset review would not trigger section 751(c)(4)(B) of the Tariff Act. As the United States
previously noted, since the 2005 Sunset Re gulations went into effect Commerce has not made
findings of waiver or company-specific likelihood in cases where respondent interested parties failed
to participate in a sunset review.
3

4. Finally, Argentina's arguments concerning the interpretation of section 751(c)(4) of the Tariff
Act are contrary to the findings of the Panel in th e original proceeding with respect to the operation of
the statutory and regulatory waiver provisions.
4 Argentina is asking the Panel in this Article 21.5
proceeding to make a factual finding that would contra dict factual findings made in the original phase
of this dispute. That is not th e Panel's role in this Article 21.5 compliance proceeding. Argentina has

1 See US First Written Submission, paras. 16-21; US Second Written Submission, paras. 12-19;
US Answers to Questions from the Panel, paras. 2-24; and 2005 Sunset Regulations, 70 FR at 62062-62063
(Exhibit ARG-12)
2 Argentina Answers to Questions from the Panel, para. 3 (emphasis in original).
3 US Answers to Questions from the Panel, paras. 12 and 18.
4 See, e.g., US Second Written Submission, para. 17, quoting the Panel Report, paras. 7.84-7.85.

failed to demonstrate that amendment of the re gulatory waiver provisions fails to bring the
US measure into conformity with the DSB's recommendations and rulings.

Q2. The Panel notes Argentina's assertion, in paragraph 156 of its Second Written
Submission, that the current US law directs the USDOC to find likelihood for companies that
"elect not to participate in USDOC's sunset review, but also does not file an affirmative
statement of waiver and an admission that it is likely to dump". The Panel also notes
Argentina's statement in paragraph 83 of its or al submission that the Tariff Act directs the
USDOC to find likelihood for exporters that do not participate and that do not file a statement
of waiver either. Finally, the Panel notes the US ' statement in paragraphs 5 and 8 of its oral
submission that "deemed waivers" have no w disappeared following the deletion of
Section 351.218(d)(2)(iii) of the Regulations.

 (a) Is Argentina challenging the US implementation of recommendations and
rulings relating to "deemed waivers"? Should the Panel understand Argentina's
assertion to be that the so-called "deemed waiver" provisions of the US law have
not been repealed, or properly amended, by the United States in the context of
implementing the DSB's recommendations and rulings in this case? Please
elaborate.

5. Argentina argues that the Panel should consider how the US statutory and regulatory waiver
provisions operate in order to determine whethe r the United States has brought its measure into
conformity with the DSB's recommendations and ruli ngs. In its original report, the Panel already
addressed how the US statutory and regulatory waiver provisions operate.

6. Rather than demonstrate how the United States has failed to bring its measure into conformity
with the DSB's recommendations and rulings – pr esumably because it is unable to do so – Argentina
chooses to mischaracterize the terms and operation of section 751(c)(4) of the Tariff Act. The terms
of the statute simply do not direct a company-specific finding of likelihood for any respondent
interested party that fails to participate in a sunset review.
5 Moreover, the scope of the waiver
provisions in the regulations is now simply coterminous with the scope of the statute. 6 Argentina's
suggestion to the contrary is fallacious and premis ed upon its incorrect interpretation of the plain
meaning of the statute.7

7. Finally, the fact that the statute direct s Commerce to make a company-specific likelihood
finding for a company that files a waiver statement does not mean, ipso facto as Argentina contends,
8
that Commerce would disregard other, contrary r ecord evidence in reaching its ultimate order-wide
likelihood determination. As previously explained, while Commerce would consider a company-
specific likelihood finding in making its order-wide li kelihood determination, the relevance of such a
company-specific finding to the ultimate sunset de termination always would depend on the facts on
the administrative record in that sunset review. 9 The statute does not require Commerce to find
likelihood in its ultimate order-wide determination ju st because a company elects not to participate in
the sunset review.

 (b) If not, would it be an accurate charac terization of Argentina's claim to stipulate
that Argentina is only taking issue with the so-called "explicit waiver"

5 See, e.g., US Answers to Questions from the Panel, paras. 10-12.
6 See US Answers to Questions from the Panel, paras. 2-9, 21-24.
7 See Argentina Answers to Questions from the Panel, para. 11 (implying that Commerce is attempting
to "override" the statute through modification of its regulations).
8 Argentina Answers to Questions from the Panel, para. 13.
9 See US Answers to Questions from the Panel, paras. 13-14, 19-20.

provisions of the US law in these Article 21.5 DSU proceedings? If so, would
Argentina agree that the current US law does not contain any provision that
deems exporters to have waived their righ t to participate in sunset reviews for
failure to provide a full substantive resp onse to the USDOC's questionnaire or
for any other reason? Please elaborate.

8. Argentina's interpretation of the terms of section 751(c)(4) of the Tariff Act – including the
phrase "elect not to participate" in subparagraph "(A)" is incorrect. "Election," as contemplated by the
statute, means taking affirmative action to signal that a party is voluntarily choosing to waive its
participation, i.e., by submitting a waiver to Commerce. The Statement of Administrative Action – an
authoritative interpretive tool for the statute – confirms this reading of the statute:

If Commerce receives such a waiver , Commerce will conclude that revocation ...
would be likely to lead to continuation or recurrence of dumping ... with respect to
the submitter.
10

 Therefore, contrary to Argentina's contenti on, the terms of the statute do not direct a
company-specific finding of likelihood for respondent interested parties that fail to participate at all in
a sunset review.
11

9. Argentina also is wrong that application of sec tion 751(c)(4)(B) of the Tariff Act, triggered by
filing a waiver statement and resulting in a company-specific finding of likelihood, is inconsistent
with Article 11.3 of the AD Agreement.
12 As the Appellate Body recognized,

[I]t [is] neither necessary nor relevant ... to draw a conclusion as to the WTO-
consistency of the company-specific determinations resulting from the waiver
provisions. As we have observed, the releva nt inquiry in this dispute is whether the
order-wide likelihood determination would be rendered inconsistent with Article 11.3
by virtue of the operation of the waiver provisions.
13

10. Thus, contrary to Argentina's assertion, a company-specific finding of likelihood in and of
itself cannot violate Article 11.3. Moreover, Ar gentina has failed to demonstrate how Commerce's
ultimate order-wide likelihood determination is rende red inconsistent with Article 11.3 because there
is a possibility it might, in part, be based on a company-specific likelihood determination premised
upon a party's own statement that it is likely to du mp if the order were revoked. As previously
explained, in reaching its ultimate order-wide lik elihood determination Commerce would consider all
evidence and argument on the administrative record. The relevance of a company-specific finding to
the ultimate sunset determination always would de pend on the facts on the record in that sunset
review.
14 The statute does not require Commerce to find likelihood in its ultimate order-wide
determination just because a company elects not to participate in the sunset review.

11. Argentina's interpretation of section 751(c)(4) of the Tariff Act is contrary to the original
findings of the Panel with respect to the operation of the statutory and regulatory waiver provisions.
15
The Panel in this Article 21.5 compliance proceeding need not, and should not, revisit this finding.

10 SAA at 881 (emphasis added) (Exhibit US-12).
11 Argentina Answers to Questions from the Panel, para. 16.
12 Argentina Answers to Questions from the Panel, para. 15.
13 Appellate Body Report, para. 232 (emphasis in original).
14 See US Answers to Questions from the Panel, paras. 13-14, 19-20.
15 See, e.g., US Second Written Submission, para. 17, quoting the Panel Report, paras. 7.84-7.85.

Q7. Under what circumstances would a signed waiver statement constitute a sufficient
evidentiary basis for an affirmative likelihood determination? Would your response depend on
the circumstances of a given sunset review? For example, would your response differ in relation
to: (i) a review in which the only exporter subm its a signed waiver statement; (ii) a review in
which, of the 20 exporters involved, 10 submit a signed waiver statement and 10 participate
cooperatively; (iii) a review in which, of the 20 exporters involved, 1 submits a signed waiver
statement and 19 remain silent? How would the company-specific conclusions of likelihood
with respect to exporters that waive their right to participate (by signing a statement of waiver)
in these scenarios be reflected in an ultimate order-wide determination?

12. As Argentina recognizes, Commerce will ma ke a company-specific likelihood finding as a
consequence of a party choosing to submit a waiver – the contents of which are prescribed by the
sunset regulations. Specifically, section 351.218(d)(2)( ii) of the sunset regulations provides that a
party choosing to submit a waiver must include a statement that it would be likely to dump if the order
were revoked. We also agree with Argentina that the probative value of a company-specific finding
relative to the ultimate sunset determination can va ry and would depend on the particular facts on the
record in that sunset review.
16

13. In the underlying proceeding, the Appellate Body recognized that the relevant question with
regard to Commerce's sunset review is whether the order-wide likelihood determina tion is consistent
with Article 11.3 of the AD Agreement. A compan y-specific likelihood finding would be relevant
only to the extent that it "tainted" the ultimate or der-wide determination. As the Appellate Body
stated,

[I]t [is] neither necessary nor relevant ... to draw a conclusion as to the WTO-
consistency of the company-specific determinations resulting from the waiver
provisions. As we have observed, the releva nt inquiry in this dispute is whether the
order-wide likelihood determination would be rendered inconsistent with Article 11.3
by virtue of the operation of the waiver provisions.
17

Thus, contrary to Argentina's assertion, a comp any-specific finding of likelihood in and of itself
cannot breach Article 11.3.

14. Moreover, the adverse finding in the underlyi ng dispute was that company-specific likelihood
findings were based on an assumption, rather than on record evidence. Commerce's amended sunset
regulations eliminate the possibility that a comp any-specific likelihood finding will be based on an
assumption.

15. Argentina's arguments in this compliance pro ceeding fail to consider or address the changes
to Commerce's sunset regulations. Specifically, Argentina has failed to demonstrate how Commerce's
ultimate order-wide likelihood determination is rende red inconsistent with Article 11.3 because there
is a possibility it might, in part, be based on a company-specific likelihood determination premised
upon a party's own statement that it is likely to du mp if the order were revoked. As previously
explained, in reaching its ultimate order-wide lik elihood determination Commerce would consider all
evidence and argument on the administrative record. Therefore, the relevance of a company-specific
finding to the ultimate sunset determination always would depend on the facts on the record in that
sunset review.
18 No assumption is implicated.

16 Argentina Answers to Questions from the Panel, para. 19.
17 Appellate Body Report, para. 232 (emphasis in original).
18 See US Answers to Questions from the Panel, paras. 13-14, 19-20.

Q8. The Panel notes that Section 751 (c)(4) of the Tariff Act does not define the term
"waiver". The Panel also notes that Section 3 51.218(2)(ii) of the Regulations states that a
statement of waiver "must include a statement i ndicating that the respondent is likely to
dump."

 Can this, in your view, be interpreted to mean that the Regulations nullify, or limit the
scope of, the Statute in so far as the Statute refers to waiver.

16. Again, Argentina's interpretation of the te rms and operation of section 751(c)(4) of the Tariff
Act is incorrect. Commerce has not issued a regulati on that is inconsistent with the statute. Rather,
as previously demonstrated, the scope of the 2005 regulatory waiver provisions now is coterminous
with the scope of the statute.
19 Specifically, section 751(c)(4) of the Tariff Act directs Commerce to
make an affirmative company-specific likelihoo d finding as a consequence of a party choosing to
submit a waiver. The regulations prescribe the content of such waivers. Contrary to Argentina's
contention, the terms of the statute do not direct a company-specific finding of likelihood for a
respondent interested party that fails to participate in a sunset review. 20 As previously noted, since the
2005 Sunset Regulations went into effect Commerce has not made findings of waiver or company-
specific likelihood in cases where respondent interested parties failed to participate in a sunset
review.21

Q9. The Panel notes Argentina's arguments re garding the new factual basis developed by
the USDOC in its Section 129 Determination. Is it Argentina's view that Article 11.3 of the
Anti-dumping Agreement ("Agreement") precludes an investigating authority from developing
new facts in order to comply with the DS B recommendations and rulings regarding the
inadequacy of the factual basis of its sunset de terminations? Please elaborate on the temporal
and substantive considerations involved in gath ering "new facts" in light of the notion of
implementation of the DSB recommendation s and rulings embodied, among others, in
Articles 19, 21, and 22 of the Dispute Settlement Understanding ("DSU"). How should an
investigating authority accommodate the "p rospective nature" of sunset reviews under
Article 11.3 in the process of gathering "new facts" in the course of implementation?

17. Argentina reiterates its assertion that Artic les 11.3 and 11.4 somehow limit an investigating
authority from collecting new facts in the course of implementing the recommendations and rulings of
the DSB. Indeed, Argentina now argues that an investigating authority need not only initiate its
review prior the expiry of the five-year annivers ary of the imposition of the order, but that the
investigating authority must also "gather the necess ary positive evidence" prior to the expiry of the
five-year period.
22 Articles 11.3 and 11.4 plainly state that an investigating authority must initiate a
review prior to the expiry of the five-year pe riod and that such a review should "normally" be
completed within 12 months. Neither article addresses the issue of "gathering facts".

18. Argentina also misunderstands the relevance of the provisions of the DSU identified in the
question. These provisions highlight that ther e are many possible means to implement the
recommendations and rulings of the DSB, and, the m eans of implementation are left to the discretion
of the implementing Member. Thus, Article 19.1 re quires a panel to recommend that a Member bring
its measure into conformity with th e agreement in question, but a panel may suggest ways in which
the Member could implement the recommendations. Article 21.3 recognizes that it may be
impracticable for a Member to comply immediatel y with the recommendations and rulings and thus

19 See US Answers to Questions from the Panel, paras. 2-9, 21-24.
20 See, e.g., US Answers to Questions from the Panel, paras. 10-12.
21 US Answers to Questions from the Panel, paras. 12 and 18.
22 Argentina Answers to Panel Questions, para. 25.

affords a Member a reasonable period of time in wh ich to do so. These provisions do not restrict a
Member's ability to collect new factual information.

19. The text of Articles 11.3 and 11.4 does not pr ovide for sunset reviews to be treated any
differently than any other measure found to be WT O-inconsistent – in other words, Argentina's
attempt to read the "temporal restrictions" in Articles 11.3 and 11.4 as restricting a Member's means
of implementation is without merit.

Q12. The Panel notes Argentina's claim regardi ng the comparison the USDOC made between
Acindar's export prices and the average transa ction price (by weighted average value) that
prevailed in the US market for the subject pr oduct. The Panel also notes that the USDOC
inferred from this comparison the conclusion th at Acindar was likely dumping in the period of
review.

 (b) The Panel notes Argentina's assertion that the USDOC ignored certain factors
that affected this comparison, such as differences in the physical characteristics
of the products compared, the levels of trade at which the comparison was made,
as well as differences relating to transportation costs.

 Please explain in detail and by referring to the relevant parts of the record,
whether any of these factors were known to the USDOC in the Section 129
proceedings at issue and, if so, whether this was taken into account.

20. Argentina complains that the comparisons Commerce made between the CBP data and
Preston Pipe & Tube data did not take certain product characteristics into account.
23 However,
Argentina has uniformly failed to explain how th ese comparisons could have been made on a more
specific level given the fact that there was no record information to do so. Acindar never provided its
costs – data that would have allowed Commerce to make comparisons on a more specific level.
Foreign producers are in control of their own in formation – Commerce cannot be penalized for the
foreign producers' failure to retain their own cost information.

21. Argentina asserts that Commerce's statemen t in the Section 129 Determination that the
comparisons of the CBP data to the Preston Pipe & Tube data were "based on identical matches of
these characteristics" is "factually incorrect."
24 Argentina suggests that Commerce's statement
implies that Commerce based its matches on end finishing. 25 However, Argentina fails to inform this
Panel that Commerce was explicitly referring to three characteristics:

The categories which defined our product gr oupings in this determination were, of
necessity, broad. They do, however, reflect th ree significant characteristics that serve
to determine price in the market ( i.e. seamless v. welded, carbon v. alloy, and casing
v. tubing v. drill pipe). Furthermore, we made our comparison of Acindar's sales,
discussed above, based on identical matches of these characteristics.
26

Argentina is simply quoting part of a sentence out of context.

23 Argentina Answers to Questions from the Panel, para. 49.
24 Argentina Answers to Questions from the Panel, para. 48. We note that this quote is taken from page
8 of the Section 129 determination – not page 4, as indicated by Argentina.
25 Id.
26 Section 129 Determination, at 8 (Exhibit ARG-16).

22. Argentina also would like this panel to believe that end finish ing results in a price difference
of $250/ton.27 However, a closer inspection of the US Steel price list, which was never placed on the
record of the Section 129 proceeding, demonstrates that end finishing plays a much smaller role in
pricing than Argentina asserts. First, the example Argentina points to on page 11 relates to plain end,
non-upset tubing. Upsetting alone accounts for $150 of the price difference; and most of the market is
casing, not tubing, and casing is mostly non-upset. In contrast, the price difference between PE and
T&C for casing is only $70. 28 Thus, Argentina's example is not indicative of the normal pricing
differences. Conversely, the price for carbon casing USS 50 is $755/ton, and that for H40/K55 is
$785/ton, yet the lowest grade alloy for that same size is N80 at $955/ton and a higher grade alloy,
P110, is $1110/ton. Thus, the price difference be tween alloy and carbon for one size of casing can
range from $170/ton to $355/ton. Whether the OCTG is alloy or carbon has a more significant impact
on the price than whether it is PE or T&C.

23. By comparing only contemporaneous identical matches for seamless v. welded, carbon v.
alloy, and casing v. tubing for Acindar's sales, Commerce controlled for the factors that had the
largest impact on the price. As previously explai ned, had respondents been able to provide reliable
cost data, Commerce would have been able to make these comparisons on an even more precise basis.

Q13. The Panel notes that the USDOC's Sect ion 129 Determination states that the USDOC
did not use the cost data in Acindar's financia l statements because those data related to a
product category that included products other th an the subject product. The USDOC stated
that "the inclusion of costs related to the m erchandise not subject to review would distort [the
USDOC's] analysis." Yet the USDOC relied on these financial statements with respect to its
determination that the OCTG market was depressed in the period of review.

(a) Please explain, by referring to the rel evant parts of the record, the relevance of
the financial statements of Siderca a nd Acindar for both the company-specific
and order-wide phases of the USDOC's sunset determination in these
proceedings. More specifically, please explain whether the USDOC used these
statements in support of its order-wide determination that dumping was likely to
continue or recur should the order be revoked and where such use is reflected on
the record.

24. As a preliminary matter, Argentina argues th at an order-wide likelihood determination in a
sunset review requires the Member "to develop a su fficient factual basis regarding the likely actions
of the specific companies."
29 This is not accurate. The Appellate Body has recognized that "a broad
range of factors other than import volumes and dumping margins is potentially relevant to the
authorities' likelihood determination." 30 Company-specific determinations are not necessary for an
order-wide determination.

25. Argentina alleges that Commerce "rejected th e more specific information which showed that
the division producing OCTG was profitable," instead relying on information showing the loss that
had been generated from the general operations.
31 This is not an accurate characterization of
Commerce's finding. First, Commerce never "rejected" information in Acindar's financial statement.
In fact, no party ever argued during the Secti on 129 proceeding that Aci ndar's OCTG production was
profitable.

27 Argentina Answers to Questions from the Panel, para. 48.
28 US Steel price list, at 6 (Exhibit ARG-34).
29 Argentina Answers to Questions from the Panel, para. 52.
30 US – Corrosion-Resistant Steel Sunset Review (AB), para. 186.
31 Argentina Answers to Questions from the Panel, para. 53.

26. Second, Commerce explained that the cost da ta was too broad because it failed to break out
OCTG products from the broad category of "tubes, pipes and structural products."
32 It would not have
been a meaningful comparison to compare that br oad of a category with the very specific importer
data. Further, Acindar's financial statement never showed that OCTG was profitable. It only reported
data on a broad product-basis and there is no way to measure the profitability of OCTG within that
broader grouping.

27. In contrast, some broader conclusions regard ing likelihood could be ga thered from Acindar's
financial statement. For instance, Acindar's overall operations were showing losses. When a
company is experiencing such losses, it is reasonabl e to conclude that the company will continue to
sell at below market prices in the United States rather than hold onto the inventory. In fact, Acindar
confirmed that this was its sales plan, by explai ning that "Acindar's strategy has been and will
continue to be to focus on the Argentine market while using the export market to stabilize its overall
sales volume during periods of slow down in domestic economic activity. "
33 This is exactly what
Acindar did during the following administrative revi ew and was found to be dumping at a margin of
60.73 per cent. Therefore, even though the financ ial statements could not be used to make specific
price comparisons, they did provide some informat ion on the overall financial condition of Acindar
and the likelihood determination as to Acindar.

28. Argentina argues in its comments in the tabl e associated with paragraph 53 of its response
that Commerce did not rely upon Acindar's financia l statements to demonstr ate Acindar's likelihood
to dump if the order were revoked, but instead onl y relied upon them to demonstrate Acindar's likely
past dumping. This is incorrect. In its Sec tion 129 Determination, Commerce explained that its
conclusion that "Acindar was likely to continue se lling to the United States at dumped prices if the
order were revoked" was supported by the above statement rega rding Acindar's use of the export
market to stabilize its overall sales volume.
34 Thus, information from the financial statement was
used to demonstrate Acindar's likelihood to dump if the order were revoked.

29. Further, in its chart, Argentina suggests th at Commerce relied on Siderca's financial statement
to conclude that both companies would continue to sell at low prices after the period. However, that
is incorrect; the determination plainly states that Siderca's financial statement supported Commerce's
conclusion about the OCTG market generally – that it would be depressed – and not that Siderca
would continue to sell at low prices.

 (b) Please explain, by referring to the relevant parts of the record, whether the
financial statements of these two comp anies reflected the overall production
operations of these companies or whether the data relating to the subject
product, i.e. OCTG, could be separately identified.

30. Contrary to Argentina's assertion, neither Siderca's nor Acindar's financial statements
provided cost or sales data relating specifically to OCTG. Though Argentina concedes that Siderca's
financial statements have no "disaggr egation," it argues that Acindar's do.
35 However, on page F-75,
it is clear that the information is only provided on broad terms – e.g., foreign trade; tubes, pipes, and

32 Section 129 Determination, at 7 (Exhibit ARG-16).
33 Section 129 Determination, at 10-11 (Exhibit ARG-16).
34 Section 129 Determination, at 10-11 (Exhibit ARG-16).
35 Argentina Answers to Questions from the Panel, para. 55. Though not asked about the extrapolated
cost data, Siderca offers that its cost data provided the "relative volume." As previously explained, the cost data
Siderca provided was only an estimate and failed to factor product-mix into account. Thus, there was no
accurate information regarding Siderca's costs of OCTG production or the "relative volume of OCTG and non-
OCTG products."

structural products; and steel and rolled products. 36 OCTG cannot be separately identified in either
Acindar's or Siderca's financial statements. It should be noted Argentina has not identified any
argumentation by respondents on the record of th e Section 129 proceeding suggesting that Acindar's
OCTG division was profitable.

 (c) Please explain whether the share of OCTG in these two companies' overall
production operations was taken into account in making the inference on the
basis of these statements that the OCTG market was depressed.

31. Argentina argues that Commerce did not properly consider the overall share of OCTG
production in these companies' operations in dete rmining whether the OCTG market was depressed.
37
This statement ignores the fact that Commerce reviewed the experiences of US producers to confirm
that the OCTG market was depressed. 38 Even Siderca asserted that the OCTG market was depressed
in "1999/2000."39

Q16. The Panel notes Argentina's assertion in pa ragraph 30 of its Oral Statement that in the
period of review of the Section 129 Sunset Determ ination at issue, the prices of the subject
product in the United States were significantly higher than other markets. Please elaborate by
referring to the relevant parts of the record of the measure at issue.

32. The United States noted in its response to this question that this information was not on the
record of the Section 129 proceeding, and Argentina in its answer agrees.
40

Q17. (a) How, if at all, did the original panel address the parties' claims and arguments
relating to the USDOC's volume analysis? Did it exercise "judicial economy"?

33. The United States would simply note that it do es not seek to "take advantage" of the original
Panel's exercise of judicial economy. Rather, in order to comply with the recommendations and
rulings of the DSB in this dispute, the United States was not required to reconsider its volume
analysis, given that there were no findings that the US volume analysis was inconsistent with
US WTO obligations. If Argentina considered that reconsideration of the volume analysis had been
necessary to "resolve the dispute," as it apparently now does
41, then Argentina should have appealed
the original Panel's exercise of judicial economy as having been false.42

(b) What considerations should guide this Panel in addressing the parties' claims
and arguments in these 21.5 DSU proceedings? Would any prejudice arise to
any party in the even the Panel did, or did not, address the volume analysis?

34. In its answers, Argentina once again fails to recognize that the question before the Panel is
whether the United States implemented the recommenda tions and rulings of the DSB, and Argentina
continues to avoid referring to the recommendations and rulings of the DSB. Instead, Argentina states
that "[i]n this compliance proceeding, the Unite d States must bring itself into compliance with
Article 11.3 of the Anti-Dumping Agreement."
43 In fact, the question in this compliance proceeding

36 Letter from US Steel, at F-75 (Exhibit ARG-27).
37 Argentina Answers to Questions from the Panel, para. 57.
38 US Answers to Questions from the Panel, paras. 46-50.
39 Siderca 7 December Letter, at 7 (Exhibit ARG-19).
40 Argentina states that this information is "not pa rt of the record of the Section 129 proceeding."
Argentina Answers to Questions from the Panel, para. 62.
41 Argentina Answers to Panel Questions, para. 70.
42 See, e.g., US Answers to Panel Questions, para. 75.
43 Argentina Answers to Panel Questions, para. 70.

concerns the existence or consistency with a covere d agreement of measures taken to comply with the
recommendations and rulings of the DSB. As the United States has repeatedly noted, the Appellate
Body in EC – Bed Linen (21.5) clarified that not all aspects of a redetermination are "inseparable
elements" of the measure taken to comply.
44

35. As noted above, Argentina states that the Pane l has an obligation to "resolve the matter before
it,"45 implying that a finding on the volume analysis is necessary for purposes of such resolution. If
so, then Argentina is implicitly asserting that the or iginal Panel exercised false judicial economy – by
definition, failing to make findings sufficient to resolve a dispute. 46 Argentina did not appeal that
issue, despite the fact that it had an opportunity to do so. Insofar as the DSB recommendations and
rulings therefore included no finding regarding th e volume analysis, Argentina is not now in a
position to assert that the United States failed to implement any recommendation and ruling related to
the volume analysis. The matter before this Panel simply does not include the volume analysis.

36. Argentina asserts that it would suffer prejudice because it has "consisten tly alleged" that the
volume inference is inconsistent with Article 11.3.
47 It is unclear just what Argentina means.
Argentina does not explain why maki ng an allegation, consistently or otherwise, entitles a Member to
a finding on an issue for which a panel exercised judicial economy.

37. Argentina also contends that the United Stat es can claim no prejudice because it chose to rely
on the volume inference as a basis of its determination.
48 That approach cannot be reconciled with the
reasoning and facts of EC – Bed Linen (21.5). In Bed Linen , the panel and the Appellate Body
considered that the EC's injury analysis was flawed, and to come into compliance, the EC conducted a
new analysis of the impact of dumped imports unde r Article 3.4. In addition, however, the EC
incorporated its original "other factors" analysis into its redetermination. The EC of necessity "relied"
on that analysis – under Article 3.5, it is impossi ble to make an affirmative injury determination
without conducting a causation analysis, including an "oth er factors" analysis. Yet the "other factors"
analysis was not considered part of the measure taken to comply because it was an aspect of the
original determination that the EC did not change, and did not have to change, to comply with the
recommendations and rulings of the DSB. Therefore, whether a Member "relies" on an aspect of the
original determination in its rede termination is not the question; the question is whether the Member
had to change that aspect of the original dete rmination to comply with the recommendations and
rulings of the DSB. Just as the EC did not have to reconsider its "other factors" analysis, so
Commerce did not have to reconsider the "volume analysis."

(c) Is the USDOC's volume analysis part of the measure taken to comply with the
DSB recommendations and rulings for the purposes of Article 21.5 DSU? Why
or why not? Would it have been possi ble for the original panel to address the
USDOC's volume analysis?

38. The United States agrees that the volume an alysis was part of the Section 129 proceeding.
49
That does not, however, answer the question in th is Article 21.5 proceeding of whether the volume

44 See, e.g. , US Answers to Panel Questions, para. 71; US First Submission, para. 34; US Second
Submission, para. 28.
45 Argentina Answers to Panel Questions, para. 74.
46 See Appellate Body Report, European Communities – Export Subsidies on Sugar, WT/DS265/AB/R,
WT/DS266/AB/R, WT/DS283/AB/R, para. 335 (adopted 19 May 2005) ("In this case, the Panel's findings . . .
were not sufficient to 'fully resolve' the dispute. . . . This constitutes false judicial economy and legal error.")
("EC – Sugar (AB)").
47 Argentina Answers to Panel Questions, para. 74.
48 Argentina Answers to Panel Questions, para. 74.
49 Argentina Answers to Panel Questions, para. 78.

analysis was an inseparable element of the measure taken to comply. If the entire redetermination
were necessarily equivalent to th e measure taken to comply, then Bed Linen (21.5) would have been
decided differently.

39. Argentina considers that it addressed, in its Second Submission, the question of whether the
volume analysis is part of the measure taken to comply.
50 However, Argentina's analysis rests on the
erroneous premise that the volume analysis in this dispute can be distinguished from the EC's "other
factors" analysis in Bed Linen (21.5) on the basis that Commerce "re lied" on its analysis, whereas the
EC merely "confirmed" its analysis. As noted above , the EC of necessity relied on its "other factors"
analysis for purposes of reconsidering its injury determination.

 Please indicate the relevance, if any, of th e Appellate Body Reports in EC - Bed Linen
(Article 21.5 - India ) and US - Softwood Lumber IV (Article 21.5 - Canada) in your responses
to the above questions.

Q18. The Panel notes Argentina's argument that the USDOC disregarded the comments
made by the Argentine exporters with regard to the decline in the volume of imports. The Panel
also notes the US' argument that these comments were not germane to the issue. Siderca's
response to the questionnaire to which Argentina refers in this regard, reads in relevant part:

 Whatever the significance of a decline in export volume may be as a general matter,
Siderca knows that, with respect to Siderca, it does not mean that the product could not be
shipped without dumping. The cost data (even with the limitations explained above) supports
Siderca's position: Siderca is a cost-efficient producer of OCTG and could have shipped OCTG
products profitably to the United States.

 (b) Is there any other reference on the record that contains Argentine exporters'
comments with regard to the decline in the volume of imports?

40. Argentina's characterization that Siderca's submission presented "evidence" to explain the
decline in import volumes is strained, at best. At the outset, it bears repeating that Siderca's shipments
ceased after the order was imposed. Siderca pr ovided no reasoned explanation as to why it stopped
shipping entirely after the order was imposed.

41. Siderca's explanation that it had "diversifi ed" its exports was, to be generous, weakly
supported,
51 and does not, in any event, explain why Siderca stopped shipping entirely.
Diversification does not explain why a company th at had been a significant exporter to the United
States before the order would suddenly stop shippi ng once the order was in place – especially when
the United States is a prime export market for OCTG.

Q25. Please respond to the US' argument that because no company-specific determination
was made for Siderca, facts available were not used for this company.

42. Argentina has failed to demonstrate how Ar ticles 6.8 or 11.3 require a company-specific
finding of likelihood as to each e xporter or producer. No such requi rement exists. The Appellate

50 Argentina Answers to Panel Questions, para. 75.
51 Siderca's "evidence" of diversification consisted of nothing more than references to joint ventures in
various countries. For example, Siderca cited a Canadian joint venture with Algoma, but emphasized that the
joint venture would use existing production facilities in Canada, rather than importing from Argentina.
Siderca's Questionnaire Resp., Attachment 1, at 3-4 (Exhibit Arg-15).

Body also has recognized that, with respect to Ar ticle 11.3, the relevant issue is the order-wide
determination – and not the company-specific ones.
52

43. Argentina has failed to explain how no finding as to Siderca is actually a finding on the basis
of facts available. No finding is simply that – no decision was reached as to Siderca's likelihood.
Argentina claims Commerce used "facts available" but did not label it as such with those "magic
words."
53 However, Argentina has never explai ned how Commerce supposedly used "facts
available."

44. Argentina implies that the US position is that "the avoidance of the term 'facts available'" is
conclusive, and that simply because Commerce did not use the term in its determination neither
Article 6.8 or Annex II apply.
54 This is not the US position. Again, Commerce did not make a
finding with respect to Siderca on the b asis of facts available because it made no finding with respect
to Siderca. Further, the United States has not hes itated to acknowledge in this proceeding that, even
though Commerce did not use the words "facts availa ble" when using the Preston Pipe & Tube data
for Acindar, it used alternate information from secondary sources, as provided for in Article 6.8 and
paragraph 7 of Annex II.55

45. Argentina argues that the "US position rests on the flawed assumption that Article 6.8 and
Annex II obligations apply only to information that is used to support conclusions of the investigating
authority."
56 The United States has not taken that position. Rather, the US position is based on the
language of Article 6.8, which provides that an inv estigating authority may resort to the use of facts
available when an interested party does not provide necessary information. It is, by its own terms,
simply not applicable to information that is not necessary. In this instance, Commerce considered the
totality of the evidence on the record and conc luded that Siderca's cost information was not
"necessary information" within the meaning of Ar ticle 6.8 because other evidence on the record
supported the order-wide determination without having to make a company-specific finding regarding
Siderca. To interpret Article 6.8 as including all information, whether necessary or not, would read
the word "necessary" out of that provision, and such an approach cannot be reconciled with principles
of treaty interpretation.

46, Indeed, that the information was not "necessar y" is confirmed by the fact that Commerce did
not use other facts in lieu of the information Siderca provided.

47. Argentina then asserts that if "the USDOC is goi ng to reject information . . . then the authority
has an obligation to comply with the re quirements of Article 6.8 and Annex II."
57 Article 6.8 says
nothing about rejecting information. Article 6.8 only applies when a determination is made on the
basis of facts available. Annex II only applies if the criteria of Article 6.8 have been met. Because no
facts available were used for Siderca, there wa s no obligation to inform Siderca that its cost
information would not be used.

48. Argentina similarly gets the standard backwa rd when it argues that Article 6.8 does not apply
unless a party is recalcitrant – and implying that it does apply if a party participates.
58 It does not
matter how recalcitrant the parties are in a proceedi ng – Article 6.8 only applies when a decision is

52 Appellate Body Report, para. 232.
53 Argentina Answers to Questions from the Panel, para. 131.
54 Argentina Answers to Questions from the Panel, para. 127.
56 Argentina Answers to Questions from the Panel, para. 129.
57 Argentina Answers to Questions from the Panel, para. 129.
58 Argentina Answers to Questions from the Panel, para. 133.

"made on the basis of facts available." Thus, because there was no company-specific finding as to
Siderca, no decision was made on the basis of facts available and Article 6.8 does not apply.

49. Argentina suggests that an order-wide dete rmination necessarily means that Commerce used
"facts available" with regard to Siderca. Ar gentina ignores that the fact that in making its
determination, an investigating authority engages in a weighing of the evidence, some provided by
respondents, some provided by petitioners. The mere fact that a respondent submits information and
that information is not ultimately used in making th e determination does not mean that facts available
have been used with respect to that respondent. In this regard, the United States notes that Article 6.8
refers not to respondent interested parties, but interested parties more generally, including domestic
interested parties. Under Argentina's approach , the mere weighing of evidence would necessarily
result in the application of facts available to someone in every determination – either petitioner if
respondent's information is more probative, or respondent if pe titioner's information is more
probative.

Q26. (b) The Panel notes Argentina's assertion, among others, in paragraph 55 of its Oral
Submission, that the data submitted by Siderca indicated higher costs for alloy
products compared with casing products throughout the period of review, with
the exception of the year 2000. The Panel understands Argentina's argument to
be that the USDOC should have compared the costs of, for example, carbon
casing PE with that of alloy casing PE and carbon casing T&C with that of alloy
casing T&C.

 Is the Panel's understanding correct regarding Argentina's assertion?

50. The United States recalls that Commerce had asked for respondents' costs on the level of
T&C and PE. The costs Siderca provided were not reliable, for the reasons already detailed, and
Acindar declined to provide any cost information. Therefore, Commerce had to make the comparison
on a broader level using Preston data – which does not report PE and T&C separately.

51. The United States notes that Argentina argues for a more specific comparison of its costs, yet
fails to point out that these costs were allocated based on an index from October 2005 that never
factored in the product-mix during the period.
59 Thus, Argentina is arguing for a comparison on a
more specific level, when its own allocation met hodology could not provide accurate costs on that
same level.

52. Furthermore, as explained in the US res ponse to question 26(a) from the Panel, Commerce
reviewed Siderca's costs on both a specific and aggreg ate level. Because of the inherent flaws in the
methodology used to allocat e costs, the costs fail ed to reflect the rea lity of OCTG production,
regardless of how they were reviewed.

(c) Please explain why, in your view, it wa s not proper for the USDOC to rely on the
same grouping that Preston Publishing used for the subject product.

53. Argentina argues that Commerce only performed one comparison for Siderca's data – carbon
vs. alloy products.
60 As we have previously explained, the comparison between carbon and alloy was
not the only comparison Commerce performed when assessing Siderca's data. 61 Commerce looked at
the data on a more specific level that held end -finishing constant, as well as comparing non-OCTG

59 Argentina Answers to Questions from the Panel, paras. 134-135.
60 Argentina Answers to Questions from the Panel, para. 137.
61 US Answers to Questions from the Panel, paras. 89-91.

costs to OCTG costs. The data failed to reflect the reality of OCTG production in each of the various
comparisons.

Q30. Please explain in detail whether, in your view, paragraph 3 of Annex II justified the
rejection of Siderca's cost data. In particul ar, please explain whether the cost information
submitted by Siderca was verifiable within the meaning of paragraph 3. Did the USDOC take
any steps to verify such information?

54. Argentina argues that because its data was veri fiable, it could have been used without "undue
difficulties."
62 However, Article 6.8 and Annex II are app licable only if "facts available" are used.
The United States did not make a finding with respect to Siderca, and therefore, Annex II is not
applicable.

55. The United States explained in its answer to th is question that the problem with Siderca's data
is not that the application of the allo cation methodology could not be verified. 63 Commerce never
contended that Siderca applied its methodology incorrectly; however, Commerce did consider that the
methodology itself was flawed, resulting in costs that did not reflect the reality of OCTG production.

56. Paragraph 3 contemplates a Member verifyi ng whether the information provided by the party
accurately reflects its period sales and costs. Siderca stated that it did not maintain its product-
specific cost data and that the data provided were extrapolated based on 2005 data. Thus, the data
were not verifiable within the meaning of paragra ph 3 of Annex II as it would be impossible to verify
whether Siderca's reported costs reflected its actual period costs.

Q31. The Panel notes the following part of the USDOC's Section 129 Determination:

Although Siderca attempted to cooperate with the Department's request for
information, upon analysis of Siderca's calculations, we have identified
significant problems with its allocation of costs, with respect to both OCTG
production and all tubular production.

(a) Please explain your views about the relevance of this determination to
the issue of whether or not Siderca acted to the best of its ability in
submitting its cost information to the USDOC within the meaning of
paragraph 5 of Annex II to the Agreement.

57. Argentina argues that because Ar gentina acted to the "best of its ability" its data should have
been used because it was "far preferable that {sic} the data ultimately relied on by USDOC."
64 The
United States considers that Argentina must have meant that Siderca, not Argentina, is the party that
acted to the best of its ability, in view of the fact that Siderca, not Argentina, was a respondent
interested party in the Section 129 proceeding. In any event, as noted above, Annex II is not relevant
to Commerce's Section 129 Determination with r espect to Siderca because Commerce did not use
"facts available" with respect to Siderca – it made no determination with respect to Siderca, nor was it
required to make a finding. As a result, the issue of whether Siderca acted to the best of its ability was
not implicated.

58. Moreover, whether or not Siderca acted to the b est of its ability is irrelevant with respect to
Commerce's company-specific determination as to Acindar. Acindar provided no cost information

62 Argentina Answers to Questions from the Panel, paras. 140-141.
63 US Answers to Questions from the Panel, para. 106.
64Argentina Answers to Questions from the Panel, para. 148.

and so Commerce relied on the best available inform ation to use as a surrogate for Acindar's normal
value – actual US average unit values from Preston Pipe and Tube.

59. Finally, as discussed below, the fact that a pa rty may have acted to the best of its ability does
not necessarily mean that the information it has provide d is of sufficient qualit y that the investigating
authority is obliged to use it.

(b) Please explain how ideal the cost info rmation submitted by Siderca was within
the meaning of paragraph 5 of Annex II to the Agreement.

60. Argentina concedes that "though the cost da ta submitted by Siderca may have not been
'ideal,'" it was preferable to relying on st atements in Siderca's financial statements.
65 First, Siderca's
cost data was far from "ideal" because it was onl y an estimate, based on an extrapolation from
October 2005 data that did not even control for f actors such as product mix. Even had Commerce
made a company-specific determination as to Siderc a, it could not have relied upon the extrapolated
cost data to do so. As explained in our answer to question 26(a), the cost data was not reliable and did
not reflect the reality of OCTG production.

61. The United States notes that Argentina e rroneously presumes that Commerce rejected
Siderca's cost information and used its financial statements instead, i.e., to draw a conclusion about
what Siderca would be likely to do if the order were revoked. However, the cost data and the
financial statements were considered for diffe rent purposes. Commerce had asked for the cost
information in its consideration of whether it could make a company-specific finding about Siderca.
However, Commerce relied upon the financial st atements for the order-wide determination,
buttressing Siderca's own argument that the OCTG market was depressed during the period.
Therefore, the United States does not agree that Commerce rejected "probative data" and instead
"speculated" and "relied" on "assumptions ba sed on selective reliance on Siderca's financial
statements."

Q32. (a) In your view, was the USDOC under an obligation to inform Siderca of the fact
that its cost information would not be used as well as to give Siderca a chance to
make comments as to why the information had to be used by the USDOC
pursuant to paragraph 6 of Annex II? If so, was the USDOC under an
obligation to do it prior to the issuance of its Section 129 Determination?

(b) Did the USDOC actually inform Siderca of this fact and give Siderca a chance to
make comments? If so, when? Did Siderca know that its cost data were not going
to be used by the USDOC in its determinations?

62. The following addresses both (a) and (b):

63. As detailed in its submissions, Commerce di d not make a finding regarding Siderca, and
therefore, Commerce did not make a finding regarding Siderca on the basis of "facts available."
Annex II is not applicable. For that reason, Comme rce was not under an obligation to inform Siderca
that its information was not being used, or to provide an opportunity to provide further explanations.

64. The Panel's report in Egypt – Rebar from Turkey is inapposite as it relates to a situation where
a Member requests information that is necessary because it is calculating a company-specific margin,
and thus, Article 6.8 is relevant.
66 In contrast, though Commerce requested Siderca's cost data, it

65Argentina Answers to Questions from the Panel, para. 150.
66 Argentina Answers to Questions from the Panel, para. 152.

ultimately found it not reliable and made no comp any-specific determination as to Siderca.
Therefore, the information was not necessary for Commerce's order-wide likelihood determination.

65. Argentina's citation in footnote 104 of its an swers to the Panel's questions references the
following insightful discussion in Egypt – Rebar from Turkey regarding data that is not sufficient even
if the interested party has acted to the best of its ability.
67 Specifically, the Rebar panel explained that:

[A]n interested party's level of effort to submit certain information does not
necessarily have anything to do with the substantive quality of the information
submitted, and in any case is not the only determinant thereof. We recall that the
Appellate Body, in US – Hot Rolled Steel , recognized this principle (although in a
slightly different context), stating that "parties may very well 'cooperate' to a high
degree, even though the requested information is, ultimately, not obtained. This is
because the fact of 'cooperating' is in itself not determinative of the end result of the
cooperation.
68

Simply because Siderca may have acted to the b est of its ability does not require that Commerce
utilize its cost data when that cost data was proven unreliable.

Q33. The Panel notes Argentina's assertion that the USDOC violated paragraph 7 of
Annex II by failing to apply special circumspection with regard to the information it took from
secondary sources instead of the information subm itted by the Argentine companies. Please
explain clearly which company Argentina refers to in this regard. Please also explain what
secondary source, in Argentina's view, was used instead of the information submitted by the
Argentine companies. Also, please explain how exactly the USDOC failed to use the most
appropriate information instead of the information submitted by the Argentine companies.

66. Argentina failed to address the Panel' s question as to what Commerce used " instead of the
information submitted by Argentine companies."
69 This is because no information was used "instead"
of the information submitted by Siderca, and Acindar did not submit any cost data, so no information
was used "instead."

67. The United States also notes that paragraph 7 of Annex II does not contemplate requesting
further information from interested parties. Ra ther, paragraph 7 contemplates that investigating
authorities have already requested informati on from the parties and are now turning to secondary
sources, not primary sources. Thus, paragraph 7 expressly not es that information in the petition may
be used, and information from secondary sour ces may be checked against information from other
interested parties.

68. Argentina argues that requesting informa tion from Acindar would provide for a "more
appropriate comparison." The United States w ould note that paragraph 7 does not provide for
"appropriate comparisons." Rather, it provides that an investigating authority may have recourse to
secondary sources if the interested party does not provide n ecessary information. In any event, the
Preston Pipe and Tube data – the secondary information of the kind provided for in paragraph 7 – was
reported on a broader basis than the Acindar im porter data. The only way a "more appropriate
comparison" could have been made would have been if Acindar had retained and reported its costs for
the period. Acindar did not do so – hence the recourse to secondary sources.

67 Argentina's footnote appears to refer to a different section of Egypt – Rebar than the section
referenced in the body of Argentina's answers.
69 Emphasis added.

69. Argentina contends that use of pricing data based on a commercial publication does not
constitute an objective exam ination of information. 70 Argentina's position implies that a Member
complying with the authorization under paragra ph 7 of Annex II to use secondary sources is per se
failing to comply with its obligati ons under Article 11.3. Paragraph 7 does not specify that the price
lists must be "private," nor does it prohibit use of "commercial" price lists. Paragraph 7 provides that
secondary sources include information supplied by petitioners; it is odd indeed to suggest that an
investigating authority may rely on information su pplied by petitioners, but not on an independent
source of information – a commercial price list.

70 Argentina Answers to Questions from the Panel, para. 156.

ANNEX E-5

ANSWERS OF THE UNITED STATES TO
ARGENTINA'S WRITTEN QUESTIONS

Measure Taken to Comply

Q1. If USDOC only incorporated the volume infe rence from its original sunset review, why
did USDOC ask question 8 of its questionnaire ("Did you ship any merchandise under
consideration to the United States during the period 1 August 1995 through 31 July 2000? If so,
indicate the shipment volumes.")

1. See US Answer to Panel Question 18(a).

Q2. The United States indicates that the volum e inference from the original sunset review
was incorporated into the Section 129 determination.

(a) Was the inference in the original sunset review based on the Sunset Policy
Bulletin ("SPB")?

(b) If yes, does the United States agree that USDOC relied on the SPB in the Section
129 Determination? If not, please explain.

Q3. Is the inference that USDOC draws from the volume decline a necessary part of the
USDOC's conclusion in the Section 129 determin ation that expiry of the measure would be
likely to lead to a continuation or recurrence of dumping?

Q4. Does the affirmative "likelihood" determin ation stand without inference of likelihood
based on the volume findings?

Regarding the Volume Inference

Q5. Page 11 of the 129 Determination states: "Declining import volumes after, and
apparently resulting from, imposition of an an tidumping duty order indicate that exporters
would need to dump to sell at pre-order levels."

 (a) What is the textual support in Article 11.3 for an investigating authority to make
a finding based on an "apparent" link between the declining volumes and the
dumping order?

(b) Please explain how the USDOC's relian ce on an "apparent" link is consistent
with the Appellate Body's statement in this dispute that "the investigating
authority must arrive at a reasoned determination resting on a sufficient factual
basis; it may not rely on assumptions or conjecture."

(c) Please explain how the USDOC's relian ce on an "apparent" link is consistent
with the Appellate Body's statement tha t: "The cessation of imports in the
second scenario and the decline in import volumes in the third scenario could
well have been caused or reinforced by changes in the competitive conditions of
the market-place or strategies of exporters, rather than by the imposition of the

duty alone. Therefore, a case-specific analysis of the factors behind a cessation
of imports or a decline in import volum es (when dumping is eliminated) will be
necessary to determine that dumping w ill recur if the duty is terminated." ( US -
Corrosion Resistant Sunset Review, DS244, AB Report, para. 177).

(d) Why does the USDOC believe that declining import volumes apparently caused
by the imposition of the order necessarily "indicate that exporters would need to
dump"?

(e) The quoted statement in the chapeau to this question suggests to Argentina that
USDOC found that declining import volumes were conclusive of whether
revocation of the order would lead to continuation or recurrence of dumping.
Does the United States agree? If not, please explain.

(f) Why does USDOC focus on the exporter's ability to "sell at pre-order levels"?
Is this required in order to obtain termination under Article 11.3? Is the
authority's obligation to establish "likely" dumping different if the exporters do
not ship at pre-order volumes?

(g) Can you identify the portion of th e Issues and Decision Memorandum from the
original sunset determination (ARG- 8) that specifically states that:

(i) USDOC could draw inferences from "declining import volumes after,
and apparently resulting from, imposition of an antidumping duty
order";

 (ii) the Argentine exporters "would need to dump" upon expiry.

Q6. We note that the exporter, Siderca , provided factual information in its
30 November 2005 response (ARG-15) regarding the decline in its volume (pages 7 - 10).

(a) Did USDOC consider this information?

(b) Did it influence USDOC's statement that the declining import volumes
"apparently resulted from the imposition of the antidumping duty?" If no,
please explain why not.
Regarding Article 11.3 and Article 11.4 Obligations

2. The volume analysis is not within the scope of these proceedings.

Q7. The United States has claimed that it is now in compliance with Article 11.3. But,
assuming that the DSB ultimately adopts rulin gs and recommendations that it is not, will the
United States terminate the measure?

3. As the United States is in compliance with the DSB recommendations and rulings, there is no
basis for the assumption in the question. In any event, the question is not relevant to the matter before
the Panel, whether the measure taken to comply by the United States is consistent with the covered
agreements.

Q8. In light of the time-frames establishe d by Articles 11.3 and 11.4 (the window of
opportunity for the administering authority to collect information to establish the evidentiary
basis in order to make the substantive de termination), how can these requirements be

reconciled with the collection of new information by the USDOC five years later in a compliance
proceeding?

4. See US First Written Submission, paras. 28-31, and US Second Written Submission,
paras. 20-27.

Q9. If the United States believes that it ca n conduct more Section 129 determinations in the
event of a Panel finding in this case that the Unit ed States is not in compliance, is there a limit
on the number of such determinations that the USDOC can make? Please explain your answer.

5. The question is premised on a position not e xpressed by the United States in this proceeding.

Q10. Is there a limit on the number of times that the USDOC can collect, in subsequent
proceedings, additional evidence in order to support its original decision to continue the
measure? Please explain your answer.

6. This question is speculative.

Q11. Assuming arguendo, that an administering authority can use new information that was
gathered during the RPT in order to bring a WTO-inconsistent Article 11.3 determination into
conformity with its WTO obligations, what ar e the consequences of the new determination
being found to be inconsistent in an Article 21.5 proceeding?

7. It is not clear what is meant by "conse quences." The United States and Argentina have
reached agreement on some potential procedural consequences in that event. See WT/DS268/14.

Q12. In this case, under what authority coul d the Member keep in place AD duties that are
based on an Article 11.3 determination that has been found by a compliance panel to be an
inconsistent determination, following the expiration of the RPT?

8. The question is speculative.

Regarding Acindar's Information --"Likely Past Dumping"

Q13. Can you identify any circumstance in the original sunset proceeding in which the
USDOC or the USITC asked a specific question to Acindar and Acindar did not respond?
Please consider in your answer that the USITC stated in its 2001 determination that: "In these
reviews, the Commission received responses from Argentine producers Siderca and Acindar (a
producer of welded OCTG)." (USITC Sunset Determination, footnote 113).

9. As Argentina may recall, the United States prev ailed on all of its claims regarding the USITC,
and questions regarding the USITC are therefore beyond the scope of this proceeding.

Q14. Can you identify any circumstance in the Section 129 proceeding in which the USDOC
asked Acindar a specific question and Acindar did not respond?

10. It is unclear what Argentina means by "sp ecific question." However, Acindar did submit a
questionnaire response. See, e.g., US First Written Submission, para. 39.

Q15. Why does the USITC identify and send questionnaires to the exporters, while the
USDOC does not?

11. As Argentina may recall, the United States prev ailed on all of its claims regarding the USITC,
and questions regarding the USITC proceeding are therefore beyond the scope of this proceeding.

Q16. Does the investigating authority's obligation under Article 11.3 change depending upon
the level of participation by the exporter?

12. See, e.g., US – Japan Corrosion (AB), para. 199; US – Argentina OCTG (AB), para. 234.

Q17. The waiver provisions were applied by USDO C in the original sunset proceeding. The
Panel determined that the application of the wa iver provisions invalidated the factual basis of
USDOC's determination and rendered it inconsistent with Article 11.3.

13. Argentina provides no reference in support of its proposition that the original Panel concluded
that the waiver provisions "invalidated the factual basis" of the determination. See US First Written
Submission, para. 22.

(a) Does the United States agree that the e ffect of Acindar's non-participation in the
original sunset proceeding led to the USDOC's waiver determination, which has
already been adjudicated in this Panel's review of the original 2000 sunset
determination?

14. Commerce was not aware in 2000 that Acindar ha d failed to participate; Acindar declined to
identify itself at that time.

(b) Does the United States agree that the Section 129 Determination is a different
measure than the original 2000 USDOC sunset determination?

15. The relevance of the question is unclear, but the Section 129 Determ ination is a measure
taken to comply with the DSB recommendations and rulings in the original dispute.

(c) Does the United States agree that Acindar cooperated with the USDOC
Section 129 proceeding?

16. Argentina does not identify a provision of the Antidumping Agreement that requires an
investigating authority to establish "cooperation." Therefore, the relevance of this question is unclear.

(d) To what extent did Acindar's non-participation in the original 2000 USDOC
sunset determination affect USDOC's Section 129 determination?

17. As Argentina may be aware, Commerce perm itted Acindar to participate in the Section 129
proceeding, notwithstanding Acindar's failure to participate in the original sunset proceeding.

Q18. USDOC found that "Acindar likely was dumping subject OCTG during the original
sunset review period". The USDOC then inferred that Acindar "was likely to continue selling in
the United States at dumped prices if the order were revoked". As a basis for the inference of
"likely future dumping":

(a) Is evidence of actual past dumping sufficient to support the inference of
"likely future dumping?"
(b) Is evidence of "likely" past dum ping a weaker basis for the inference
than evidence of "actual" past dumping?

(c) Would "possible" past dumping be a sufficient basis for the inference of
likely future dumping?

18. Article 11.3 does not specify any particular factors that must be considered in a sunset review.
See, e.g., US – Corrosion Resistant (AB), para. 123.

Q19. What level of certainty does the no tion of likely past dumping provide?

19. It is not clear by Argentina means by "level of certainty."

Q20. If as stated by the US in its Second Written Submission, during the Section 129
Determination proceedings, USDOC sought to evaluate "what the respondent's dumping profile
had been over the life of the order" (emphasi s added), why didn't the USDOC ask information
regarding export price and normal value?

20. The United States addressed this issu e in response to the Panel's questions.

Q21. At what level of specificity have you identified the products exported by Acindar during
the sunset period? Do you know:
a. the steel grade;
b. the physical dimensions (wall thickness and outside diameter);
c. whether they are plain end or threaded and coupled;

21. The United States addressed this issu e in response to the Panel's questions.

Q22. The same question as above with respect to the products in the Preston Pipe Reports.

22. The United States addressed this issu e in response to the Panel's questions.

Q23. USDOC took the view that it had the righ t to develop a new evidentiary basis to support
its 2001 decision to continue the measure, provide d that the information pertained to the sunset
period. Why didn't USDOC ask Acindar to identify the specific products that it shipped to the
United States during the review period?

23. Argentina has failed to identify any provision in the covered agreement that requires such a
question.

Q24. The United States explained during the hearing that it constructed its 31 October 2005
questionnaire (ARG-13) with knowledge that Ac indar had no viable home or third market,
knowledge which the United States claimed that US DOC obtained in an administrative review of
a period subsequent to the sunset review period.

(a) Did USDOC establish on the record of the Section 129 determination
prior to issuance of its questionnaire that Acindar did not have a
"viable" home market or third country market?

24. The United States addressed the issue of viability in response to Panel Question 10.

(b) Would you agree that "viability" is an Article 2 concept?

25. Article 2 does not provide "concepts" just as it does not provide "notions." See US First
Written Submission, para. 46.

(c) Article 2 indicates a standard test for viability, and also indicates that "any"
sales in the home or third country mark et can be used to establish a viable
market in certain circumstances. Article 2 also indicates that viability can be
determined on a country-wide basis. Did the USDOC consider all options
provided for by Article 2 before concluding that there was not a viable home or
third country market for all of the years included in the sunset review period?

26. The United States addressed the issue of viability in response to Panel Question 10.

(d) Would you agree that "export price" and "normal value" are Article 2
concepts?

27. Article 2 does not provide "concepts" just as it does not provide "notions." See US First
Written Submission, para. 46.

(e) Can the United States indicate whether it believes that market prices in the
importing country can be used as "normal value"?

28. The appropriate surrogate for normal value depends on the facts on the record.

(f) In light of the statement by the United States that the Acindar division
encompassing OCTG production was pr ofitable, and USDOC's apparent belief
that all of Acindar's OCTG production was shipped to the United States, why
was it necessary to request product-specific OCTG costs? Why did USDOC not
conclude from the profitability of Acindar's OCTG production that Acindar was
selling above normal value and was not likely to dump in the United States?

29. The United States is unable to locate, on the record of the proceeding, an argument that
Acindar's OCTG production was profitable, nor any argument as to the relevance of that fact.

Q25. The United States indicated in the hearin g that it would not compare a welded OCTG
product with a seamless OCTG product because of the difference in the two products. Do the
same concerns permit the comparison of plai n end OCTG with threaded and coupled OCTG?
If not, why not?

30. Production of welded OCTG entails a signi ficantly different production process than for
seamless OCTG and thus, it has a significantly different cost and price structure. PE and T&C go
through the same production process that only differ in the end finishing st ages. The differences
between welded and seamless OCTG are more releva nt than the differences between PE and T&C.
This is exhibited by the fact that Preston P ublishing collects and reports prices for OCTG by
distinguishing between seamless and welded, but it does not do so for end finishing.

Q26. During the hearing and in its Second Subm ission, the United States explained that it
calculated a weighted average of Siderca's plain end and threaded and coupled products in
order to ensure that the comparison with the Pr eston Pipe Report data was on a consistent
basis. However, when comparing each of Aci ndar's US sales (which, by definition, were either
plain end or threaded and coupled) to the Preston Pipe Report data (which, by definition, did
not distinguish between plain end and threaded and coupled), the Department appears not to
have been concerned with any possible distortion that could arise from comparing products
with different end finishes. Is this reasonable? If yes, please explain why.

31. Commerce used a weighted average approach to reviewing Siderca's data because it was
analyzing the data on an aggregate level. In contr ast, when doing its analysis as to Acindar, it did a
sale-by-sale analysis so as to compare the sales with contemporaneous price data, and weight
averaging was not relevant. Had Acindar been able to provide its cost data, then Commerce would
have been able to compare the sales to the costs on a more specific level.

Siderca's Information

Q27. Did USDOC ever advise Siderca, before the final determination, that it considered
Siderca's cost information to be internally inconsistent?

32. See US First Written Submission, para. 82.

Q28. Did USDOC give Siderca the opport unity to clarify the inconsistencies?

33. See US First Written Submission, para. 82.

Regarding Waiver

Q29. Once a company files an affirmative waiver and a statement that it is likely to dump,
does the USDOC have any discretion under the statute to determine on a company-specific basis
that the waiving company would not be likely to dump?

34. See US First Written Submission, para. 14.

Q30. If the answer to the above question is yes, then please explain how a company-specific
finding that dumping would not be likely in th is circumstance could be consistent with the
mandate of Section 751(c)(4)(B) of the Tariff Act?

35. Section 751(c)(4)(B) does not speak to order-wide determinations.

Q31. Does the United States agree that under US law, in the event of a conflict between a
federal statute and an agency's implementing re gulation, that the terms of the statute would
prevail in the event of a conflict? If not, please explain why not.

36. Argentina has not established that, as a matter of US municipal law, any such conflict exists.

Q32. To illustrate the operation of the st atutory mandate, please consider the following
situation. USDOC maintains an antidumping ord er on a steel product from country A. There
are 3 exporters in A, one of which is a subsidiary of the US company that petitioned for the AD
duties. In the sunset determination, that co mpany invokes the waiver provision, admitting that
it is likely to dump in the United States upon revocation. The other 2 exporters participate by
filing a substantive response.

(a) Would DOC make an affirmative likelihood determination with respect to the
waiving exporter?

(b) Would DOC have any discretion not to make an affirmative likelihood
determination with respect to the waiving exporter?

(c) If the other two exporters later protest ed that the "admission" was false, and
done in order to increase the chances of continuing the measure, could USDOC

weigh the evidence to decide not to ma ke an affirmative determination with
respect to the waiving exporter?

37. See US Answer to Panel Question 7.

Q33. Has any party ever used the new waiver provision and submitted a the requisite
"admission" that it is likely to dump upon revocation?

38. The United States is unaware of any such waiver at this time.

Others

Q34. Has USDOC ever issued a negative sunset determination in reviews in which the US
industry requests continuation of the measure?

39. The United States is unable to relate this qu estion to any of Argentina's claims in this
proceeding.

ANNEX E-6

COMMENTS OF ARGENTINA ON THE UNITED STATES'
RESPONSES TO THE WRITTEN QUESTIONS
FROM ARGENTINA

Argentina's General Comment on US Response to Argentina's Questions

1. In response to the express invitation of the Panel, Argentina prepared a series of written
questions that addressed several critical issues that ar e at the heart of this dispute. In recognition of
the fact that the US positions had changed or were evolving during the course of the proceeding, and
reflecting on some of the exchanges that took place during the Panel's meetings with the Parties and
the Third Parties, Argentina believed that there was merit in taking the Panel up on its offer to present
written questions to the United States.

2. Argentina's written questions were presented as a means to help clarify issues and to permit
the Panel to assess the US position, or to attempt to have the United States take a position on certain
issues. In this way, Argentina hoped to facilitate th is Panel's analysis of the dispute before it. In
response to Argentina's effort, the United St ates submitted a document entitled "US Answers to
Argentina's Questions, 24 July 2006." Yet, the substance of the document does not in any way reflect
its title, as the US submission is essentially non-respons ive. In fact, the tenor and approach of the
submission is wholly dismissive of Argentina's questions. Evidently, the United States believes that it
is simply unimportant for the United States to r espond to Argentina's written questions. Argentina
would respectfully urge the Panel to review th e written questions of Argentina and to note the
stunning lack of substance in the US responses. The US decision to be largely non-responsive, vague,
and flippant serves only to highlight that the United States could not formulate substantive answers to
Argentina's questions.

Measure Taken to Comply and USDOC's Volume Inference

3. The United States refers to the US answer to panel question 18(a) and then ignores
questions 2(a)-(b), 3, 4, 5(a)-(g), and 6(a)-(b) based on the asserti on that "The volume analysis is not
within the scope of these proceedings."1

4. Argentina recalls that it is well established in WTO jurisprudence that it is not up to the
implementing party to decide the scope of jurisdiction of an Article 21.5 panel.
2 In addition, by
expressly relying on its original finding on volum e, the USDOC placed these findings within the
scope of the "measures taken to comply" for th e purposes of this Section 21.5 proceeding. In Canada
– Aircraft , the Appellate Body confirmed that "in carry ing out its review under Article 21.5 of the
DSU, a panel is not confined to examining the 'mea sures taken to comply' from the perspective of the
claims, arguments and factual circumstances that rela ted to the measure that was the subject of the
original proceedings. Although these may have some relevance in proceedings under Article 21.5 of

1 US Answers to Argentina's Questions, 24 July 2006, para. 2.
2 See, e.g., Appellate Body Report, US – Softwood Lumber IV (Article 21.5 – Canada) , para. 73
("A Member's designation of a measure as one taken 'to comply', or not, is relevant to this inquiry, but it cannot
be conclusive. Conversely, nor is it up to the complaining Member alone to determine what constitutes the
measure taken to comply. It is rather for the Panel itself to determine the ambit of its jurisdiction.").

the DSU, Article 21.5 proceedings involve, in principle, not the original measure, but rather a new and
different measure which was not before the original panel."3

"Likely Past Dumping"

5. In response to Argentina's questions rega rding USDOC's determination that Acindar was
"likely dumping" during the sunset period and the c onsistency of that dete rmination with certain
Article 2 concepts such as "viability" "normal va lue" and "export prices," the United States offers
responses such as "Article 2 does not provide 'c oncepts' just as it does not provide 'notions'" 4 or that
an "issue was addressed in response to the Panel questions." 5 These latter statements are offered
without citation, specific references or any elaboration.

6. Argentina disagrees with the United States on whether the disciplines of Article 2 speak
directly to the concepts of viability, normal valu e, and export price. Argentina reads the text of
Article 2 to address these concepts expressly. Th e US responses simply reaffirm that the United
States was unconcerned with the requirements of th e Antidumping Agreement, believing that because
the Appellate Body clarified that Article 11.3 does not require the authority to calculate a dumping
margin for purposes of an Article 11.3 determinat ion, that the exercise is completely free from
discipline. Argentina urges the Panel to reject th e US position, and would invi te the Panel to review
Argentina's arguments regarding the fundamental fl aws with the USDOC's infe rence of likely past
dumping as the basis for its inference that dumping would be likely to continue or recur.
6

7. Consistent with the US view of the non-app licability of the Article 2 disciplines and that it
was appropriate to use observed US market prices for USDOC's determinati on of Acindar's "likely
past dumping," the United States contends that "the appropriate surrogate for normal value depends
on the facts of the record."7

8. Argentina sees no basis for the US position th at "dumping," as defined in Article 2, and
Article VI of the GATT 1994, permits a "surrogate for normal value" based on average prices in the
importing country. Also, in this case, Argentin a has demonstrated the serious flaws with the
USDOC's comparison of the observed US market prices with certain of Acindar's US sales.

9. As the Appellate Body has clarified, Article 2 is the only source in the Agreement for making
conclusions regarding "dumping."
8 Therefore, the "dumping" in Article 11.3 is the "dumping" in
Article 2, and Article 2 explains that "dumping" must arise from a comparison of "export price" to
"normal value." That is not what the USDOC did. Rather, USDOC compared prices obtained from
the US Customs authorities to local US selling prices.

10. In question 24, Argentina asked the United States a series of questions related to the
statements by the United States at the substantive m eeting that it "knew" that Acindar had no viable
home or third market. Specifically, Argentina asked whether USDOC had established this fact on the
record of the Section 129 proceeding prior to the issuance of the questionnaire.

11. The United States does not respond directly, but instead says "The United States addressed
the issue of viability in response to Panel Question 10."
9 That is the entire response. Yet, the
US response to Panel Question 10 does not address this important question directly. The closest that

3 Appellate Body Report, Canada – Aircraft, para. 41.
4 See US Answers to Argentina's Questions, 24 July 2006, paras. 25, 27.
5 See US Answers to Argentina's Questions, 24 July 2006, paras. 20, 21, 22.
6 See Argentina's First Submission, paras. 68-132; Argentina's Second Submission, paras. 35-68
7 US Answers to Argentina's Questions, 24 July 2006, para. 28.
8 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 127.

the United States comes to answering Argentina's qu estion is the statement in paragraph 25 of the
US Answers to the Panel's Questions:

"Aware that Acindar, the only exporter, had no home market or third country sales,
Commerce drafted the questionnaire with the intention of asking questions that the
respondents could actually answer, and ther efore requested the product-specific cost
data to provide an estimate of normal value."

12. If this is the only US answer, then Argentina submits that the Panel has to conclude that the
answer to Argentina's question 24 is: "no, USDOC did not establish on the record of the Section 129
determination prior to issuance of the questionnaire th at Acindar did not have a 'viable' home or third
country market."

13. Argentina also asks that the Panel refer to Argentina's other comments on the United States
response to question 10. As demonstrated there, the answers of the United States are problematic for
a number of reasons, including the fact that tangi ble evidence of what USDOC "knew" from the post-
sunset review of Acindar directly contradicts USDOC's statement in paragraph 25. The USDOC in
fact verified that Acindar did have home market sales of OCTG.

14. In question 25, Argentina asked the United States to reconcile di fferent statements relating to
the degree of diligence it applied in comparing Ac indar's sales to the Preston Pipe report average
category prices. In its response, the United States explains that there is no inconsistency: the
differences between welded and seamless pipe is "more relevant" than the differences in end
finishing, and then adds as proof the fact that Preston Publishing separates the former, but not the
latter.
10

15. Argentina offers two observations. First, th e response shows that the United States is trying
to have it both ways. It cannot deny that the di fference in end finishes can account to up to 25 per
cent of the value of some OCTG products, so it si mply asserts that the difference between welded and
seamless OCTG is "more" relevant. The point is not what is "more relevant;" the point is that
USDOC is conducting a comparison in which it is has not even tried to control for a factor that could
cause a significant variance in the price. Also, gi ven the concession by the United States that it does
not know the effect of freight costs on the Preston Publishing data, 11 it is clear that the comparison
performed suffers from the same problem that the Pane l identified with the explanations used to try to
justify the 2000 sunset determinations: it does not provide a sufficient basis to conclude that dumping
had (likely) occurred during the period, let alone that dumping would be likely to occur in the event of
expiry.

16. Second, the form in which Preston Publishi ng publishes the data provides no help to the
US argument. It is unlikely that Preston Publishing is concerned with its data being used to determine
dumping. The form in which this publication presents the data adds nothing.

Siderca's Information

17. In response to Argentina's questions regard ing whether USDOC advised Siderca before the
issuance of the Section 129 Determination that USDOC considered Siderca's cost information to be
deficient or whether Siderca was given the opportunity to respond to any of the alleged deficiencies, 12

9 US Answers to Argentina's Questions, 24 July 2006, para. 24.
10 US Answers to Argentina's Questions, 24 July 2006, para. 30.
11 See Argentina's Comments on the US Written Answ ers to the Panel's Questions (Argentina's
comments on US answer to panel question 26(a)).
12 See Argentina's Written Questions to the United States, questions US

the United States refers to paragraph 82 of the US First Submission. Therein lies the familiar
US defence that USDOC made "no company-specific finding regarding Siderca" and that the "The
Section 129 Determination was based on the findings of likely dumping by Acindar and the decreased
volumes."
13

18. Argentina has responded to this argument in de tail. The record is cl ear that Siderca was not
informed, and that the USDOC's reasons for rejec ting Siderca's cost information were seriously
flawed. Argentina refers the Panel to its submis sions on these points that the United States has failed
to rebut.14

Waiver

19. The United States has not rebutted two key points. First, the statute continues to mandate a
company-specific finding in certain instances.
15 Thus, all of the US arguments are misplaced, as the
United States failed to remedy the basic problem wi th the waiver provision that was identified by the
Appellate Body, which already has determined that a statutorily-mandated company-specific
affirmative determination will necessarily taint any country-wide determination.16

20. Second, as for the scope of subparagraph (A ) of Section 751(c)(4) – the United States and
Argentina disagree that the US revised waiver re gulation can change the meaning of the phrase "may
elect not to participate."

21. In connection with this latter point, the Un ited States has not rebutted and, therefore must
agree with Argentina, that under US law, a US st atute will prevail over a US regulation where the two
measures are inconsistent.
17 In addition, although an agency such as the USDOC may promulgate
regulations pursuant to authority granted by Co ngress, that agency cannot through the promulgation
of a regulation confer on itself any greater author ity than that conferred under the governing statute. 18
Accordingly, where the statute mandates a speci fic action (i.e., making an affirmative company-
specific likelihood determination), the statute ca nnot be overridden by USDOC's modification of an
implementing regulation.

13 US First Submission, para. 82.
14 See Argentina's First Submission, paras. 73-107, 130-132, 171-185; Argentina's Second Submission,
paras. 61-68, 78-80, 137-140; Argentina's Opening Oral Statement, paras. 51-61; Argentina's Answers to
Questions from the Panel, paras. 126-133.
15 See US Answers to Panel Questions, 24 July 2006, paras. 13-15, 19-20.
16 Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews, paras. 234-235.
17 See Argentina's Second Submission, para. 164 and note 161.
18 See Argentina's Second Submission, para. 164 and note 162.

ANNEX E-7

ADDITIONAL COMMENTS OF THE UNITED STATES
ON ARGENTINA'S ANSWERS TO QUESTIONS 20, 21
AND 22 FROM THE PANEL TO THE PARTIES

4 August 2006

Q20. (a) The Panel notes Argentina's allegat ion that by failing to respond to Siderca's
letter dated 7 December 2005, the USDOC acte d inconsistently with Articles 6.1
and 6.2. Please explain how exactly failure to reply to this letter violated the
USDOC's obligations under Articles 6.1 and 6.2.

 Argentina states that respondents did not find out until 16 December that there would be no
further procedures.
1 Yet the expiry of the reasonable period of time was 17 December. The very
point the United States made to the arbitrator, a nd which Argentina opposed, is that 15 months would
be necessary to ensure provision of many of the due process considerations that are not obligatory, but
that Argentina now considers to be the basis of its Articles 6.1 and 6.2 claims. If respondents, on
15 December (the day after their most recent f iling), were expecting further procedures, then
Argentina might have considered offering to exte nd the reasonable period of time to permit such
additional procedures.

Q21. The Panel notes Argentina's argument that the USDOC failed to make six memoranda
available to the Argentine exporters.

 (b) Please explain whether it was "practicable" within the meaning of Article 6.4 of
the Agreement for the US DOC to make these memo randa available to the
Argentine exporters in these Section 129 proceedings.

 Argentina concedes that what is "practicable" for purposes of Article 6.4 "will need to be
determined on a case-by-case basis."
2 Yet, it then argues that the Panel should disregard the severest
limiting factor for what is practicable in this case – the timeframe. Specifically, Commerce had only
six weeks to conduct its Section 129 Determination. Four of those weeks were given to the Argentine
respondents to allow them to respond to the questi onnaire – leaving only two weeks for Commerce to
review all of the record evidence and comments by th e parties, and then make its decision. What is
practicable for purposes of Article 6.4 must be viewed in light of the time constraints.

 Argentina argues that the United States shoul d have conducted the Section 129 proceeding
concurrently with the revision of the waiver regulation, but "chose not to do so".
3 However, as the
United States explained to the arbitrator, that a pproach was not possible because of the particular
findings in this dispute, i.e., that a WTO-inconsistent finding based on a company's waiver of
participation "tainted" the overall determination.4 Until the regulations were amended to eliminate the

1 Argentina's Answers to Panel Questions, para. 98.
2 Argentina's Answers to Questions, para. 115.
3 Argentina's Answers to Panel Questions, para. 116.
4 See Appellate Body Report, at para. 233 (quoting the Panel, the Appellate Body explained that "'[t]o
the extent' that the company- specific determinations [which are a result of the US provisions found to be "as
such" WTO inconsistent] were taken into account in the order-wide determination, the order-wide determination

possibility of a WTO-inconsistent waiver, Commerce could not begin the Section 129 proceeding, lest
a company "waive" participation (for example, by not filing a response) under the as-yet unamended
regulations.

 Argentina also asserts that it should have been informed of the "analysis that was being
performed".
5 However, Argentina has failed to demonstr ate that Article 6.4 requires a Member to
release its reasoning.6

Finally, Argentina argues that the United Stat es has failed to provide any explanation as to
why the memoranda could not have been provided earlier. 7 Argentina seeks to reverse the burden of
proof in this dispute by arguing that the United States should prove compliance with a provision,
when Argentina has in fact failed even to make a prima facie case of non-compliance.

Q22. The Panel notes Argentina's argument that the USDOC violated Article 6.4 by accepting
unsolicited comments from the petitioners on 30 November 2005. The Panel also notes
Argentina's acknowledgement that Siderca resp onded to these comments in its letter dated
7 December 2005.

 Please explain how exactly the admission of these comments violated Article 6.4 of the
Agreement.

 Argentina appears to be suggesting that ther e was something unusual in how "emphatically"
the petitioners in their 30 November letter stated conclusions with respect to data released by
Commerce to both parties on 28 November.
8 Argentina states that the data was released to Siderca,
"only on November 28", neglecting to mention that this is precisely the date on which petitioners also
received the data. 9 Argentina fails to explain why two days were insufficient for the petitioners (or,
for that matter Siderca) to deve lop "emphatic" conclusions. To the extent that Argentina is implying
that Commerce released the data to petitioners earlier than the 28 th, this suggestion is entirely
unfounded, unsupported and false.

could not 'be supported by reasoned and adequate conclusions based on the facts before the investigating
authority.'").
5 Argentina's Response to Panel's Questions, para. 117.
6 See, EC Pipe Fitting (AB), para. 140.
7 Argentina's Answers to Panel Questions, para. 117.
8 Argentina's Answers to Panel Questions, para. 118.
9 Argentina's Answers to Panel Questions, para. 118.

ANNEX E-8

ADDITIONAL COMMENTS OF ARGENTINA ON
THE UNITED STATES' RESPONSES TO THE
PANEL'S QUESTIONS TO THE PARTIES

11 August 2006

 Argentina recalls its 31 July Comments on the US Answer to Question 17 of the Panel's
Questions. On the issue of the judicial econom y exercised by the Panel on the volume issue,
Argentina stated in part that:

Argentina agrees with the United States th at the Panel exercised judicial economy
with respect to the volume issue…. Howeve r, the United States is incorrect when it
asserts that Argentina was required to app eal the Panel's exercise of discretion as
"false judicial economy," or abandon its right to have the issue considered on the
merits.
The flaw in the argument put forward by the United States is its refusal to
acknowledge that the Panel already had found that USDOC's 2000 sunset
determination violated Article 11.3. Th erefore, in order to bring itself into
compliance with the rulings and recommenda tions of the DSB, the United States
would either have to revoke the measure or justify the continuation based on some
further determination. Any further determ ination would be subject to review under
Article 21.5, and the Panel would be requi red to review all stated bases of that
decision in order to determine whether it w as consistent with Article 11.3. Thus, the
exercise of discretion by the Panel was not false judicial economy because the Panel
had already disposed of the matter by fi nding a violation of Article 11.3, and any
future determination seeking to justify continuation of the measure would have to
comply with Article 11.3.
1
 Argentina affirms its 31 July Comment, and would simply note that its position is fully
consistent with the Appellate Body decision in US – Anti-Dumping Measures on Oil Country Tubular
Goods.2 The Appellate Body in that case stated that:

In our view, the Panel did not commit an erro r of law in deciding to exercise judicial
economy with regard to the issue of whether the USDOC determination was
consistent with Article 2, as it had already found that determination to be inconsistent
with Article 11.3 of the Anti-Dumping Agreement. In Canada – Wheat Exports and
Grain Imports , the Appellate Body found that the practice of judicial economy
"allows a panel to refrain from making multip le findings that the same measure is
inconsistent with various provisions when a single, or a certain number of findings of
inconsistency, would suffice to resolve th e dispute." Mexico has not explained why

1 Argentina's July 31 Comments on the US Written Answers to Questions from the Panel, paras. 58 and
59.
2 Appellate Body Report, United States – Anti-Dumping Measures on Oil Country Tubular Goods
(OCTG) from Mexico, WT/DS282/AB/R, adopted 28 November 2005.

an additional finding on Mexico's claim under Article 2 of the Anti-Dumping
Agreement is necessary to resolve the dispute. And we find no such need.3
 Thus, the Appellate Body ruling in US – Anti-Dumping Measures on Oil Country Tubular
Goods simply reinforces Argentina's position that it w as not required to appeal the Panel's exercise of
discretion as "false judicial economy" in order to preserve its right to challenge the volume issue if it
were relied upon in the measure taken to comply. As in US – Anti-Dumping Measures on Oil Country
Tubular Goods, the Panel in the present case "had already found [the] determination to be inconsistent
with Article 11.3 of the Anti-Dumping Agreement" and therefore concluded that an additional finding
on volume was not necessary to resolve the dispute.

3 Id., para. 178. Footnotes deleted.