MEXICO – ANTI-DUMPING DUTIES ON STEEL PIPES AND TUBES FROM GUATEMALA
Document: Final Report of the Panel
Date: 8 June 2007
Document codes: WT/DS331/R
Complainant: Guatemala
Respondent: Mexico
Third parties: China, EU, Honduras, Japan, U.S.
Dispute stage: Panel
Agreements cited: Art. 5.2, 5.3, 5.8, 2.1, 2.4, 2.6, 3.1, 3.2, 3.4, 3.5, 3.6, 4.1, 5.4, 6.4, 6.9, 9.1, 9.3, 18.1, 6.6, 6.8, 6.13, 6.7, 6.7, 2.2, 6.2, 12.2, 6.5  Anti-dumpingArt. VI  GATT 1994Art. 1, 18.1  Anti-dumping

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

Final Report of the Panel

I. INTRODUCTION
A. COMPLAINT OF GUATEMALA
1.1 On 17 June 2005, Guatemala requ ested consultations with Mexico pursuant to Article 4 of the
Understanding on Rules and Procedures Governing the Settlement of Disputes (the " DSU"),
Article XXIII:1 of the General Agreement on Tariffs and Trade 1994 (the " GATT 1994 ") and
Article 17 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and
Trade 1994 (the " Anti-Dumping Agreement ") regarding the definitive anti-dumping measures
imposed by Mexico on imports of certain steel pi pes and tubes from Guatemala and the investigation
leading thereto. 1 Guatemala and Mexico held cons ultations on 15 July, 26 August, and
28 September 2005. These consultations failed to resolve the dispute.

1.2 On 6 February 2006, Guatemala requested the establishment of a panel pursuant to Article 6.2
of the DSU and Article 17.4 of the Anti-Dumping Agreement.2

B. E
STABLISHMENT AND COMPOSITION OF THE PANEL
1.3 At its meeting on 17 March 2006, the Di spute Settlement Body established a Panel pursuant
to the request by Guatemala in document WT/DS 331/2, in accordance with Article 6 of the Dispute
Settlement Understanding (DSU). At that meeting, the parties to the dispute also agreed that the Panel
should have standard terms of reference. The terms of reference are, therefore, the following:

"To examine, in the light of the relevant provisions of the covered agreements cited
by Guatemala in document , the matter referred to the DSB by
Guatemala in that document, and to make such findings as will assist the DSB in
making the recommendations or in giving the rulings provided for in those
agreements."
1.4 On 4 May 2006, the parties agreed to the following composition of the Panel:
3

Chairman: Mr Julio Lacarte-Muró
Members: Mr Cristian Espinosa Cañizares
 Mr Álvaro Espinoza

 China, the European Communities, Honduras, Japan, and the United States reserved their
third-party rights.

1.5 The Panel met with the parties on 12-14 Se ptember 2006 and 7-9 November 2006. It met
with the third parties on 12 September 2006.

C. A
DDITIONAL PROCEDURES FOR THE PROTECTION OF BUSINESS CONFIDENTIAL INFORMATION
1.6 To facilitate the submission of certain information by Mexico, on 27 September 2006 the
Panel adopted additional procedures for the prot ection of business confidential information. These
procedures ("the BCI procedures"), are set forth in Attachment 2.

1 WT/DS331/1.

2 WT/DS331/2.

3 WT/DS331/3.

II. FACTUAL ASPECTS
2.1 This dispute concerns the imposition by Me xico of anti-dumping measures on imports of
certain steel pipes and tubes from Guatemala.

2.2 On 22 May 2001, the Mexican company Hylsa, S.A. de C.V. ("Hylsa") filed an application
for an anti-dumping investigation concerning "standard" steel pipes and tubes.
4 Following Hylsa's
response to a request for further informati on from the Mexican investigating authority 5, Economía
published on 24 August 2001 a Notice of Initiation in its Official Journal 6, initiating an investigation
on standard steel pipes and tubes, included within the tariff lines 7306.30.01 and 7306.30.99,
originating in Guatemala. Tubac, S.A. ("T ubac") was the only Guatemalan exporting producer
investigated.

2.3 The investigation covered the period from 1 July 2000 to 31 December 2000
7 ("Investigation
Period"). The examination of "trends" in the contex t of the injury analysis covered the period from
1 July to 31 December of 1998, 1999 and 2000 8 ("Injury Investigation Period").

2.4 Numerous communications and exchanges, including questionnaires and meetings, occurred
between Economía and Tubac and/or Tubac's legal counsel in the course of the investigation. A
verification visit occurred at the premises of Tubac from 17 to 21 June 2002 and from 24 to
25 June 2002.
9

2.5 On 13 March 2002, Mexico imposed provisional anti-dumping duties of 3.41 per cent and
12.82 per cent covering all products classified in the tariff lines 7306.30.01 and 7306.30.99,
respectively, on imports from Tubac.
10 Mexico also imposed duties of 25.83 per cent and 26.59 per
cent covering all products classified in the ta riff lines 7306.30.01 and 7306.30.99, respectively, on
imports from all other Guatemalan exporters.11

2.6 On 13 January 2003, Mexico imposed definitive anti-dumping duties of 25.87 per cent on
imports of certain steel pipes and tubes from Guatemala as reflected in the Definitive Regulation.
12

4 Exhibit GTM-1.

5 Exhibit GTM-2.

6 Official Journal, 24 August 2001. Exhibit GTM-4.

7 Exhibit GTM-4, para. 2.

8 Exhibit GTM-4, para. 100.

9 Exhibit GTM-13.

10 Provisional Determination, Exhibit GTM-10, paras. 197 A and 197 B.

11 Provisional Determination, Exhibit GTM-10, paras. 197 C and 197 D.

III. PARTIES' REQUESTS FOR FINDINGS AND RECOMMENDATIONS
A. GUATEMALA
3.1 Guatemala requests that the Panel:

(a) find that by imposing anti-dumping duties on imports of steel pipes and tubes from
Guatemala, Mexico – through Economía – ac ted inconsistently with its commitments
under Articles 1 and 18.1 of the Anti-Dumping Agreement , in contravening the
following:13
(i) Article 5.2(iii), 5.2(iv), 5.3 and 5.8 of the Anti-Dumping Agreement , by
initiating the investigation without properly examining the accuracy and
adequacy of the evidence provided in the application for initiation, the
evidence of itself not being adequate or accurate for a determination of
dumping, injury or causal link between the two;
(ii) Articles 2.1, 2.4, 2.6, 3.1, 3.2, 3.4, 3.5, 4.1, 5.4, 6.4, 6.9 and 18.1 14 of the
Anti-Dumping Agreement, by modifying the definition of the product under
consideration and the like product in or der to include pipes and tubes which
were excluded from the definition in th e preliminary determination and for
which there was no investigation, by failing to make an unbiased and
objective examination of the positive evid ence in the record and any finding
of dumping, injury or causal link be tween the two regarding products for
which no investigation was either initiated or conducted, and,
notwithstanding the foregoing, by imposing definitive anti-dumping duties on
those products;
(iii) Article 6.8 and 6.13 15 and Annex II of the Anti-Dumping Agreement and
hence Article 2.1, 2.2 and 2.4 of the Anti-Dumping Agreement, by relying on
facts available without properly following the procedures laid out in
Article 6.8 and Annex II of the Anti-Dumping Agreement;
(iv) Article 6.2, 6.4, 6.7 and 6.8 16 of the Anti-Dumping Agreement, by failing to
disclose to the exporter that it had encountered problems at the on-the-spot
investigation that warranted the rejecti on of all of the exporter's data and the
use of facts available under Article 6.8; Article 6.2, 6.4, 6.7, 6.8 and 6.9 of
the Anti-Dumping Agreement, by failing to provide any subsequent adequate
explanation of the problems it had encountered at the on-the-spot

13 First written submission of Guatemala, paras. 93, 94, 102, 154, 236, 266, 279, 280 and 361.

14 In its request for the establishment of a panel, Guatemala also referred in this context to Article 3.6
(Appendix 1, point (b) of the claims relating to the product under consideration/like product).

15 In its request for the establishment of a panel, Guatemala also referred in this context to Article 6.6
(Appendix 1, point (d) of the claims relating to the determination of dumping).

16 In its request for the establishment of a panel, Guatemala also referred in this context to Article 6.6
(Appendix 1, point (e) of the claims relating to the determination of dumping).

investigation or of those that justifie d resort to facts available, and hence
Articles 2.1, 2.2 and 2.4 of the Anti-Dumping Agreement
17;
(v) Article 3.1, 3.2, 3.4 and 3.5 of the Anti-Dumping Agreement , by basing its
determination of injury and causation on a period of investigation that ended
significantly before the initiation of the investigation, without taking into
account relevant data relating to a period closer to that of the investigation,
which resulted in a determination of injury and causal link that was not based
on an objective examination or positive evidence;
(vi) Article 3.1, 3.2, 3.4 and 3.5 of the Anti-Dumping Agreement, by improperly
limiting its injury analysis to data re lating to six-month periods each year
within the period of investigation, whic h resulted in a determination of injury
and causal link that was not based on an objective examination or positive
evidence;
(vii) Articles 3.1, 3.2, 3.4, 3.5 and 4.1
18 of the Anti-Dumping Agreement , by
selectively and inconsistently using in formation relating to different time
periods and different sets of data pertaining to different companies or
combinations of companies in its analysis of the volume and price effects of
the imports under investigation, of the impact of those imports on
investigation on the domestic industry, and of causation, which resulted in a
determination of injury and causal link that was not based on an objective
examination or positive evidence;
(viii) Article 3.1 and 3.2 of the Anti-Dumping Agreement , by analysing both the
volume of the allegedly dumped imports and the effect of those imports on
prices in the domestic market for like products, and the consequent impact of
those imports on the domestic producers of such products, without relying on
an objective examination or positive evidence
19;
(ix) Article 3.1, 3.2, 3.4, and 3.5 of the Anti-Dumping Agreement , by failing to
properly analyse other known factors that were at the same time causing
injury to the domestic industry, and by failing to ensure that injury caused by
those known factors was not attributed to the imports under investigation;
(x) Article 6.9 of the Anti-Dumping Agreement, by failing to inform the exporter
of the essential facts under consideration that formed the basis for its decision
to apply definitive duties;

17 Guatemala’s request for the establishment of a pa nel also contains a claim relating to adjustments
made by Economía to the export pri ce for certain categories of expenses without making the symmetrical
adjustments to the normal value, which in the view of Guatemala was inconsistent with Article 2.1, 2.2 and 2.4
of the Anti-Dumping Agreement (Appendix 1, point (f) of the claims relating to the determination of dumping).

18 In its request for the establishment of a panel, Guatemala also referred in this context to Article 3.6
(Appendix 1, point (i) of the claims relating to the determination of injury and a causal link).

19 In its esponse to question 59 from the Panel, Guatemala withdrew the allegation contained in its
request for the establishment of a panel (Appendix 1, po int (k) of the claims relating to the determination of
injury and a causal link) that Economía had failed to evaluate properly all relevant economic factors and indices
having a bearing on the state of the domestic industry listed in Article 3.4, which in the view of Guatemala was
inconsistent with Article 3.1 and 3.4 of the Anti-Dumping Agreement.

(xi) Article 12.2 of the Anti-Dumping Agreement , by failing to disclose in its
preliminary and final determinations 20 in sufficient detail the findings and
conclusions reached on all issues of fact and law that were considered
material by the Mexican authorities;
(xii) Article 6.5 of the Anti-Dumping Agreement , by failing to require the
applicant to provide non-confidential summaries and to disclose properly
information that was not shown upon good cause to be confidential or to
disclose non-confidential summaries of confidential information.
(b) pursuant to Article 19.1 of the DSU, recomme nd that Mexico brings its measure into
conformity with the Anti-Dumping Agreement
21;
(c) pursuant to Article 19.1 of the DSU, suggest that Mexico repeal its anti-dumping duty
order.22
B. MEXICO
3.2 Mexico requests that the Panel reject all of Guatemala's allegations and determine that
Mexico acted in accordance with the Anti-Dumping Agreement. In particular, Mexico requests that
the Panel find:

 (a) in respect of initiation, that Mexico did not contravene Articles 5.2, 5.3 or 5.8 of the
Anti-Dumping Agreement because the request for initiation contained the information
that was reasonably available to the app licant; and because Economía analyzed this
information, requested clarifications, and on this basis determined that there was
sufficient evidence of the existence of a lleged dumping, injury and causal link to
justify initiation
23;

 (b) in respect of alleged changes to the definition of the investigated product, that
Mexico did not contravene Articles 1, 2.1, 2.4, 2.6, 3.1, 3.2, 3.4, 3.5, 4.1, 5.4, 6.4, 6.9
or 18.1, because the Anti-Dumping Agreement does not contain rules concerning the
definition of the investigated product; becau se Economía correctly considered the
physical characteristics and technical and commercial interchangeability of the
products at issue; and because Economía re ached its injury determination on the
basis of an objective examination of positive evidence
24;

 (c) in respect of Economía's rejection of the information provided by the exporter and
resort to facts available for the determ ination of dumping, that Mexico did not
contravene Article 6.8 or Annex II of the Anti-Dumping Agreement because the
exporter deliberately provided incomplete and inaccurate information that did not
come from its accounting records, such that it did not provide all of the necessary

20 In its response to question 128 from the Panel, Gu atemala withdrew its allegations relating to the
final determination.

23 First written submission of Mexico, paras. 14, 51, 75 and 76.

24 First written submission of Mexico, paras. 91, 97, 98, 99, 104 and 108.

information within a reasonable period and thus significantly impeded the
investigation
25;

 (d) in respect of Economía's provision of o pportunities for the exporter to see all relevant
information and to prepare presentations thereon, Economía's provision of a report on
the results of the verification, and Economía 's informing the exporter of the essential
fact that its information was to be reject ed and facts available used instead, that
Mexico did not contravene Articles 6.2, 6.4, 6.7, 6.8, or 6.9 of the Anti-Dumping
Agreement because the exporter knew and was r esponsible for the existence of the
problems encountered at verification; because the verification report prepared by
Economía accurately described the results of the verification visit; because Economía
informed the exporter of the essential facts that were the basis of its decision to apply
definitive anti-dumping duties through: (a) the publication of its Preliminary and
Final Determinations, (b) the public hearing
, and (c) the content of the file to which
Guatemala had access throughout the inv estigation process; and because Economía's
published resolutions covered completely a nd adequately Economía's considerations
and conclusions on the issues of dumping, injury and causal link, including all
questions of fact and law considered pe rtinent by Economía, among which were its
determination of dumping on the basis of facts available
26;

 (e) in respect of Economía's use, for the injury analysis, of a period that concluded eight
months before the initiation of the investigation, that Guatemala did not present a
prima facie case that Mexico contravened Articles 3.1, 3.2, 3.4 or 3.5 of the Anti-
Dumping Agreement; and that in any case, Economía made an objective examination
based on positive evidence in using inform ation for that period for its injury
analysis
27;

 (f) in respect of Economía's use, for the in jury analysis, of data for three consecutive
half-yearly periods, that Guatemala did not present a prima facie case that Mexico
contravened Articles 3.1, 3.2, 3.4 or 3.5 of the Anti-Dumping Agreement; and that in
any case, Economía made an objective exam ination based on positive evidence in
using information for those periods for its injury analysis28;

 (g) in respect of Economía's use, in its analys is of different injury factors, of data for
different companies or different combina tions of companies within the domestic
industry, that Mexico did not contravene Articles 3.1, 3.2, 3.4, 3.5 or 4.1 of the Anti-
Dumping Agreement because Economía based its anal ysis on information that
pertained either to the domestic industry as a whole or to a major proportion thereof
in accordance with the Anti-Dumping Agreement29;

 (h) in respect of Economía's analysis of the volume of imports of the investigated
product from countries other than Guatemala, and of the price effects of the subject
imports, that Mexico did not contravene Articles 3.1 or 3.2 of the Anti-Dumping

25 First written submission of Mexico, paras. 142, 148, 150 and 151.

26 First written submission of Mexico, paras. 142, 152, 290, 293, 295, and 296.

27 First written submission of Mexico, paras. 163, 174 and 175.

28 First written submission of Mexico, paras. 188, 203 and 204.

29 First written submission of Mexico, paras. 211 and 213.

Agreement because Economía's methodology (a sample of transactions to which was
applied a range of minimum and maximum prices) was permissible as the Agreement
contains no specific rules in this re gard; and because Guatemala's allegation
concerning Economía's analysis of the price effects of the subject imports was based
on a factual error
30;

 (i) in respect of Economía's causation/non-a ttribution analysis, that Guatemala did not
present a prima facie case that Mexico contravened Articles 3.1, 3.2, 3.4 or 3.5 of the
Anti-Dumping Agreement because in respect of the "other known factors" cited by
Guatemala, (a) there was no increase in operating costs contrary to Guatemala's
allegation; and (b) Mexico explained the reasons why it considered that the decline in
exports was not a determinative factor causing injury31;

 (j) in respect of the treatment in the Pr eliminary and Final Determinations of the
changes in the definition of the investigated product, that in relation to the Final
Determination Mexico did not c ontravene Article 12.2 of the Anti-Dumping
Agreement because Guatemala's citation of that Determination is inaccurate, as the
change in product diameters is only releva nt for the Preliminary Determination; and
that Mexico did not contravene that provision in relation to the Preliminary
Determination, because that Determination in dicates that the exporter did not object
to, and thus tacitly accepted, the change in the diameter; and that in general the
Determinations contain all of the information required by Article 12.2
32; and

 (k) in respect of access to confidential info rmation, that Mexico did not contravene
Article 6.5 of the Anti-Dumping Agreement because under Mexican law all interested
parties are allowed access to the confidential file subject to compliance with certain
conditions; because Economía analyzed the sufficiency of the justifications presented
by interested parties requesting confid ential treatment for submitted information
before granting such treatment; and because Economía obtained non-confidential
summaries except in respect of certain types of information (tables of numbers) that
in the view of Mexico cannot be summarized.
33

IV. ARGUMENTS OF THE PARTIES
4.1 The arguments of the parties as set forth in their executive summaries submitted to the Panel,
are attached to this Report as Annexes (see List of Annexes, page vi).

V. ARGUMENTS OF THE THIRD PARTIES
5.1 The arguments of the third parties as set fo rth in their executive summaries submitted to the
Panel, i.e. the European Communities, Japan, and th e United States, are attached to this Report as
Annexes (see List of Annexes, page vi).

30 First written submission of Mexico, paras. 238, 241 and 244.

31 First written submission of Mexico, paras. 259, 261, 274, 278 and 279.

32 First written submission of Mexico, paras. 300, 301, 302 and 303.

33 First written submission of Mexico, paras. 305, 306, 312 and 313.

VI. INTERIM REVIEW
6.1 We have made a number of technical rectifica tions to paragraphs 2.2, 7.74 and 7.164 and to
footnote 210.

A. R
EQUESTS FROM MEXICO
6.2 With regard to paragraphs 7. 20 and 7.21, Mexico questions our characterization of some of its
assertions regarding the obligations impo sed by Article 5.2 and 5.3 of the Anti-Dumping Agreement.
It submits, in particular, that it never argued th at Article 5.3 does not impose obligations on an
investigating authority. Guatemala does not comment . We have introduced a clarification regarding
our reading of Mexico's argument.

6.3 With regard to paragraph 7.38, Mexico argu es that none of the parties contended that there
were 124 different products (figure cited by the Panel in that paragraph), and suggests that the Panel
may have been referring to the alleged number of product codes (132) cited in Guatemala's
arguments. Guatemala does not comment. We have amended a sentence in the paragraph for the sake
of greater clarity and to point out in particular th at the 124 products is a figure we ourselves found on
the basis of the evidence submitted.

6.4 With regard to paragraphs 7.58 an 7.59, Mexi co questions the standard we applied in finding
that initiation was not justified by insufficient ev idence on the volume of imports of the investigated
product. Mexico asks us to clarify whether the re ason was that the authority took no additional steps
to ascertain the relevance of the information obtained at tariff line level, regardless of whether or not
it could get more accurate information, or whet her the incompatibility stemmed from the actual lack
of additional data any more accurate than those pr ovided in the application. Mexico challenges our
finding that Economía "had access" to import "ped imentos" arguing that, on the contrary, Economía
had to obtain them from other sources. Mexico al so requests clarification of the assertion that our
focus was on "the type of evidence of injury". Guatemala does not comment. As to the standard we
applied, we have introduced a number of changes in paragraph 7.58. We have replaced "had access"
in paragraph 7.59 with "obtained" so as to clarify the factual situation. As to our focus on the " type of
evidence", we have introduced a new footnote, number 115, with a cross reference to paragraph 7.56.

6.5 As regards our determinations regarding the adequacy of information on imports from
countries other than the one investigated, in gene ral, Mexico argues that Economía sought a much
larger set of "pedimentos" than it ultimately obtaine d. Mexico requests clarification as to the manner
in which Economía could have gone about obtaining more "pedimentos". Guatemala does not
comment. First, this request of Mexico's is not very clear to us since Mexico gives no paragraph
references. We have nevertheless introduced a clar ification in paragraph 7. 283 regarding Mexico's
argument on Economía's attempts to obtain more "pedim entos", which it did obtain in the end. Since
we consider our findings and conclusions on this matter sufficiently clear, we have made no other
changes to this part of the report.

6.6 With regard to 7.64, Mexico denies any cont radiction in its assertions as to whether two types
of tubing were investigated, or only one. Gu atemala does not comment. We have introduced a
clarification in the paragraph and point out that , in any event, the point of the paragraph (as
paragraph 7.65 indicates) is not to assume that Mexico concedes that Economía changed the definition
of the product in the course of the investigation.

6.7 In paragraphs 7.76 and 7.98, Mexico suggest s that we correct the references to standards
"ASTM A-513" and "ASTM A-500" respectively. Guat emala takes the view that these references are
correct. Since they are exact quotations from documents in the file and pertain to products other than
standard A-53 tubing, we have placed them in inverted commas.

6.8 Mexico seeks clarification of our assertion in paragraph 7.379 that "t he Agreement does not
address interested parties ..." Guatemala does not comment. We have clarified the paragraph.

B. R
EQUESTS FROM GUATEMALA
6.9 Guatemala questions our assertion in paragraph 7.239 regarding the practical constraints the
applicant met in collecting and analysing data, in the context of the period between the investigation
period and the initiation of the investigation, and s eeks clarification as to how time constraints in
analysing the information in an application would aff ect determination of the period of investigation.
Guatemala also asks us to clarify how we consider ed the five factors listed in the report of the
Appellate Body in Mexico – Anti-Dumping Measures on Rice (quoted by us in paragraph 7.238).
Mexico does not comment. Our assertion in para graph 7.239 cited by Guatemala concerns the
practical constraints faced by an applicant, not the constraints faced by an investigating authority in
analysing an application. We therefore see no need to change this paragraph. As to the factors listed
by the Appellate Body in the Rice case, we believe our findings and conclusions to be clear in that the
factual situation here is different from that in the Rice case. Furthermore, as the Appellate Body itself
said in its report, the analysis and factors in Rice were specific to the case. Consequently, we do not
consider them to be a standard "checklist" to be applied mechanically.

6.10 Guatemala asks us to explain our findi ng in paragraph 7.340 that Guatemala makes no
allegation in respect of any "dissimilarity" between the scope of the product under investigation and
the like product. Mexico does not comment. In order to clarify this finding, we have introduced in
paragraph 7.339, by means of footnote 396, a referen ce to the cited response by Guatemala, and, in
paragraph 7.340, a cross reference to paragraph 7.105 by means of footnote 397.

6.11 Guatemala asks us to clarify our factual fi ndings regarding the point in the investigation at
which Economía requested and received informat ion from the Mexican producers regarding the
products added to the scope of the investigated pr oduct. Mexico does not comment. We see no need
to make any change since this matter is already dealt with in footnotes 402 and 403.

6.12 Guatemala argues that, in the light of our findings in paragraph 7.379 and 7.388 that there
were no sufficiently detailed summaries to allow a reasonable understanding of the content of the
documents concerned, we ought to ha ve concluded that there was an inconsistency with Article 6.5.1
of the Anti-Dumping Agreement . Guatemala seeks clarification of our reasoning on this point.
Mexico does not comment. We have introduced clarification in paragraph 7.394.

6.13 Guatemala asks us to omit paragraphs 7.396 to 7.398 as th ey are not necessary to settlement
of the dispute and do not form part of Guatemala's cl aim, and at all events to avoid any kind of value
judgement as to the parties' ability to meet internal requirements of the system of a Member. Mexico
disagrees, arguing that these paragraphs respond to matte rs that Guatemala raised before us. We have
made no change to these paragraphs.

VII. FINDINGS
A. G
ENERAL
1. Standard of review
7.1 The Panel recalls the standard of review that it must apply to the matter before it.

7.2 Article 11 of the Dispute Settlement Understanding
34 sets forth the appropriate standard of
review for panels for all covered agreements except the Anti-Dumping Agreement. Article 11 imposes
upon panels a comprehensive obligation to make an "objective assessment of the matter", an
obligation which embraces all aspects of a panel's examination of the "matter", both factual and legal.
7.3 Article 17.6 of the Anti-Dumping Agreement sets forth the special standard of review
applicable to anti-dumping disputes. It provides:
"(i) in its assessment of the facts of the matter, the panel shall determine whether
the authorities’ establishment of the facts was proper and whether their evaluation of
those facts was unbiased and objective. If the establishment of the facts was proper
and the evaluation was unbiased and objectiv e, even though the panel might have
reached a different conclusion, the evaluation shall not be overturned;"
"(ii) the panel shall interpret the rele vant provisions of the Agreement in
accordance with customary rules of interpreta tion of public international law. Where
the panel finds that a relevant provision of the Agreement admits of more than one
permissible interpretation, the panel sha ll find the authorities’ measure to be in
conformity with the Agreement if it rests upon one of those permissible
interpretations."
7.4 Thus, together, Article 11 of the DSU and Article 17.6 of the Anti-Dumping Agreement set
out the standard of review the Panel must apply with respect to both the factual and legal aspects of its
examination of the claims and arguments raised by the parties.
35
7.5 In light of this standard of review, in examining the claims under the Anti-Dumping
Agreement in the matter referred to it, the Panel must evaluate whether the Mexican measure at issue
is consistent with relevant provisions of the Anti-Dumping Agreement . The Panel must find it
consistent if it finds that the Mexican investigating authority 36 has properly established the facts and
evaluated them in an unbiased and objective manner, and that its determinations rest upon a
"permissible" interpretation of the relevant provi sions. The Panel's task is not to perform a de novo
review of the information and evidence on the record of the anti-dumping investigation at issue, nor to
substitute its judgment for that of Economía, even though it might have arrived at a different
determination were it examining the record itself.
2. Burden of proof and "prima facie" case
7.6 The general principles applicable to burden of proof in WTO dispute settlement require that a
party claiming a violation of a provision of the WTO Agreement by another Member must assert and
prove its claim. 37 In these Panel proceedings, Guatemala, which has challenged the consistency of
Mexico's measure, thus bears the burden of demonstra ting that the measure is not consistent with the

34 Article 11 of the DSU, entitled "Function of Panels", states, in part: "The function of panels is to
assist the DSB in discharging its responsibilities unde r this Understanding and the covered agreements.
Accordingly, a panel should make an objective assessment of the matter before it, including an objective
assessment of the facts of the case and the applicability of and conformity with the relevant covered agreements,
and make such other findings as will assist the DSB in making the recommendations or in giving the rulings
provided for in the covered agreements …"
35 Appellate Body Report, US – Hot-Rolled Steel, paras. 54-62.

36 Unidad de Prácticas Comerciales Internacionales, hereinafter referred to as "Economía".

37 Appellate Body Report, US – Wool Shirts and Blouses, pp. 14-15.

relevant provisions of the Agreement. It is al so generally for each party asserting a fact to provide
proof thereof.38 In this respect, therefore, it is also for Mexico to provide evidence for the facts which
it asserts.
7.7 The parties' claims and arguments also touch upon a particular aspect of the burden of proof
in dispute settlement proceedings: the concept of a " prima facie case". If a party bearing the initial
burden of proof to assert the affirmative of a par ticular claim or defence adduces evidence sufficient
to raise a presumption that what it asserts is correct (i.e. a prima facie case), the burden then shifts to
the other party, who will fail unless it adduces sufficient evidence to rebut that presumption.39
7.8 Thus, a prima facie case is one which, in the absence of effective refutation by the defending
party, requires a panel, as a matter of law, to rule in favour of the complaining party presenting the
 prima facie case.40 The evidence and arguments underlying a prima facie case must be sufficient to
identify the challenged measure and its basic im port, identify the relevant WTO provision and
obligation contained therein, and explain the basis for the claimed inconsistency of the measure with
that provision. 41 The nature and scope of evidence required to establish a prima facie case will
necessarily vary from measure to measure, provision to provision, and case to case. 42 A pan e l e rr s
when it rules on a claim for which the complaining party has failed to make a prima facie case.43
3. Treaty interpretation
7.9 Where we are called upon to interpret provisions of the Anti-Dumping Agreement, we recall
that Article 3.2 of the DSU indicates that Members recognise that the WTO dispute settlement system
serves to clarify the provisions of the covered ag reements "in accordance with customary rules of
interpretation of public interna tional law". Article 31 of the Vienna Convention on the Law of
Treaties" (" Vienna Convention "), recognized as such a rule 44, provides that "[a] treaty shall be
interpreted in good faith in accordance with the or dinary meaning to be given to the terms of the
treaty in their context and in the light of its object and purpose."45
B. CLAIMS RELATING TO INITIATION OF THE INVESTIGATION
1. Arguments of the parties
(a) Guatemala
7.10 Guatemala argues that Mexico violated Article 5.2 (paragraphs (iii) and (iv)) of the Anti-
Dumping Agreement as the application failed to contain sufficient evidence of dumping and injury to

38 Ibid.

39 Ibid.

40 Appellate Body Report, EC – Hormones, para. 104.

 41 Appellate Body Report, US – Gambling, para. 141.

42 Appellate Body Report, US – Wool Shirts and Blouses , pp. 14-15. See also Appellate Body Report,
Japan – Apples, para. 159.

43 Appellate Body Report, US – Gambling, para. 139.

44 E.g. Appellate Body Report, US – Gasoline, p. 15.

45 (1969) 8 International Legal Materials 679.

justify the initiation of an investigation. Guatemal a asserts that Mexico also violated Article 5.3 in
initiating the investigation without properly exam ining the accuracy and adequacy of the evidence
provided in the application to determine whether the application contained sufficient evidence of
dumping and injury to justify the initiation. In pa rticular, Guatemala asserts that Economía could not
have adequately
 examined the evidence in the application, as if it had done so, it would not have
initiated the investigation because it would have de termined that the evid ence was insufficient.
According to Guatemala, these violations also led to a violation of Article 5.8, as there was
insufficient evidence of dumping and injury to justify proceeding with the case.
(b) Mexico
7.11 Mexico asserts that Article 5.2 is directed at applicants, and does not impose any obligation
on an investigating authority. According to Mexico , the application contained sufficient evidence of
dumping and injury that was reasonably available to the applicant in accordance with Article 5.2 and
the investigating authority properly examined the accuracy and adequacy of the evidence to justify the
initiation of the investigation in compliance with Article 5.3. In Mexico's view, there was,
accordingly, sufficient evidence to justify proceeding with the case under Article 5.8.
2. Arguments of the third parties
7.12 The European Communities asserts that the use of Articles 2 and 3 of the Anti-Dumping
Agreement to inform the Panel's interpretation of Articl es 5.2 and 5.3 would be correct. If the Panel
were to find that the application did not contai n sufficient evidence of dumping and injury under
Article 5.2, it would not be necessary to also ev aluate the Article 5.3 claim. According to the
European Communities, to satisfy Article 5.2, an application should ordinarily contain evidence of
normal value from a particular producer, or exporter, or an explanation or indication as to why data
from another firm should be considered representative of that producer or exporter.
7.13 According to the United States, Article 5.2 does not dictate that an application must contain a
particular form or quantum of evidence relating to dumping or injury. What is "reasonably available"
to the applicant depends on the circumstances of each case. An investigating authority may initiate an
investigation based on application evidence of home- market pricing of a producer not named in the
application, or of a price quote, or relating to only certain models of the product in question, or
relating to broader tariff classification import data.
3. Evaluation by the Panel
(a) Factual background
7.14 On 18 May 2001, Hylsa S.A. de C.V. filed an application for initiation of an anti-dumping
investigation on "standard" welded galvanized a nd black pipes and tubes from Guatemala, imported
under tariff classifications 7306.30. 01 and 7306.30.99, respectively.
46 The application identified the
Guatemalan company Tubac as the only known e xporter of the allegedly dumped product. On
11 June 2001, the investigating authority, the Ministry of the Economy ( Secretaría de Economía –
"Economía") issued a request for fu rther information (a "prevención" 47) seeking certain clarifications

46 Exhibit GTM-1. While the application itself is dated in the year "2000", this is presumably a
typographical error, as the parties treated the applicati on as having been submitted in 2001, and as it contains
information up to December of 2000.

47 Exhibit GTM-2.

from Hylsa, including with respect to the evidence of normal value 48, export price 49 and import
volumes.50 Hylsa responded on 9 July 2001. In support of the allegation of dumping, the evidence
before Economía at the time of initiation comprised: (i) for normal value: two pieces of evidence –
an invoice reflecting a sale of galvanized standa rd tubing and a price quote for a potential sale of
black standard tubing 51; (ii) for export price, import sta tistics from the statistics database of the
Ministry of Economy "Sistema de Información Co mercial de México" or "SICMEX", as well as
estimates derived from private import "pedimentos". 52 In support of the alleged injury, the evidence
before the IA comprised data on economic indicators for Hylsa, and the published data from SICMEX
on the total volume and value of imports for the two tariff lines that included, but were not limited to,
the product under investigation. 53 The Mexican investigating authority initiated the investigation on
24 August 2001, indicating that it had largely relied the evidence submitted by the applicant
pertaining to normal value54, export price55 and import volumes56 with minor adjustments.

48 Exhibit GTM-2, p. 6, questions 18-23. The ques tions pertained to: why the application referred to
an invoice of "Tubac" as exporter, when the actual invoice submitted pertained to Ferretería Ferrominera ("FF");
the domicile of the latter (as the invoice indicated that the buyer, but not the seller, was located in Guatemala);
and normal value and adjustments for black standard tubing, as the invoice related only to galvanized standard
tubing.

49 See question 17 of Exhibit GTM-2. The question concerned adjustments for freight, insurance and
credit terms.

50 Exhibit GTM-2, p. 6, questions 3-4.

51 See Initiation Determination, Exhibit GTM-4, paras. 62-66. See also Exhibit GTM-1, response to
Question 21 and Exhibit GTM-3, response to Question 21. The invoice was submitted to the Panel as Exhibit
MEX-1; the price quote was submitted (as Business Confidential Information) to the Panel in Exhibit MEX-26.

52 In the Initiation Determination, Exhibit GTM-4, para. 55, this export price evidence is described as a
document for each product with correspond ing invoice. See Exhibit GTM-1, Vol. 1, response to Question 17
and associated annexes.

53 Exhibit GTM-1, Volume 2, Section III.

54 Exhibit GTM-4, paras. 62 and 63 indicated that Economía made slight adjustments to the applicant's
proposed exchange rates to be applied to the invoice and the price quote. However, Exhibit GTM-4, para. 65
states: "The Ministry accepted the in formation provided by the applicant .. . The Ministry based its calculation
of the weighted average normal value for each product on ..." the invoice an d the price quote. In respect of
adjustments to normal value, para. 67 indicates: "The Ministry agreed to adjust the normal value for credit
according to the information and methodology proposed by the applicant."

55 Exhibit GTM-4, "Determination Accepting the Appli cation of the Interested Party and Declaring the
Initiation of the Anti-dumping Investigation on Imports of Standard Pipes and Tubes (merchandise currently
classified under tariff classification 7306.30.01 and 7306.30.99 of the General Import Tax Law) exported from
Guatemala, irrespective of the country of provenance, 24 August 2001". On export price, in paras. 56-57, the
determination indicates that Economía accepted the appli cant's information, and calculated an export price on
that basis. Economía rejected the applicant's propose d adjustments for freight and insurance (and replaced this
with its own adjustment on the basis of SICMEX) and credit (and made no credit adjustment). See paras. 59-
60.

56 As we discuss further below, in respect of import volumes, at the time of initiation, Economía had
access to official SICMEX statistics, as well as to the SICMEX statistics submitted by the applicant.

(b) Analysis
7.15 In respect of Economía's initiation of the inv estigation, Guatemala has made claims of
violation of three provisions: Articles 5.2, 5.3 and 5.8 of the Anti-Dumping Agreement.
57 At the heart
of all of these claims is Guatemala's allegation th at the evidence pertaining to dumping and to injury
on which Economía based its initiation decision was "insufficient" in the sense of Article 5.3, in a
number of respects, such that Economía's evaluation of that evidence was inadequate for the purposes
of Article 5.3. This central question thus is the main focus of our analysis. In order to structure this
analysis, we first cite the text of these provisions and consider the nature of, and relationship among,
the obligations that they contain.
7.16 Article 5.2 of the Anti-Dumping Agreement provides, in part:
"An application under paragra ph 1 shall include evidence of (a) dumping, (b) injury
within the meaning of Article VI of GATT 1994 as interpreted by this Agreement and
(c) a causal link between the dumped imports and the alleged injury. Simple
assertion, unsubstantiated by relevant eviden ce, cannot be considered sufficient to
meet the requirements of this paragraph. The application shall contain such
information as is reasonably available to the applicant on the following: ...
(iii) information on prices at which the product in question is sold
when destined for consumption in the domestic markets of the
country or countries of origin or export (or, where appropriate,
information on the prices at which the product is sold from the
country or countries of origin or export to a third country or
countries, or on the constructed value of the product) and information
on export prices or, where appropriate, on the prices at which the
product is first resold to an independent buyer in the territory of the
importing Member;
(iv) information on the evolution of the volume of the allegedly
dumped imports, the effect of these imports on prices of the like
product in the domestic market and the consequent impact of the
imports on the domestic industry, as demonstrated by relevant factors
and indices having a bearing on the state of the domestic industry,
such as those listed in paragraphs 2 and 4 of Article 3."
7.17 Article 5.3 provides:
"The authorities shall examine the accuracy and adequacy of the evidence provided in
the application to determine whether ther e is sufficient evidence to justify the
initiation of an investigation."
7.18 Article 5.8 reads, in part:

57 We address below, paras. 7.346-7.347, Guatemala's claim under Article 5.4 – that Economía should
have, but did not, reassess "standing" during the course of the investigation as the covered product scope was
enlarged – in the context of Guatemala's other claims and arguments concerning those changes in the product
scope.

"An application ... shall be rejected and an investigation shall be terminated promptly
as soon as the authorities concerned are satisfi ed that there is not sufficient evidence
of either dumping or of injury to justify proceeding with the case ...".
7.19 Article 5.2 refers to the contents of the app lication by the domestic industry requesting the
initiation of an investigation. It requi res that the application shall include, inter alia, information on
certain specific areas to the extent that it is "reasonably available" to the applicant. In this regard,
Article 5.2 states that "[s]imple assertion, unsubstan tiated by relevant evidence, cannot be considered
sufficient to meet the requirements of this paragraph". Article 5.3 makes it clear that the investigating
authority has to examine the accur acy and adequacy of the evidence provided in the application to
determine whether there is sufficient evidence to justify the initiation of the investigation. In any case
where the investigating authority judges the evidence in the application not to be a sufficient basis for
initiating an investigation, Article 5.8 requires the au thority to reject the application and terminate the
investigation.
7.20 Mexico suggests that where th e evidence in the application is sufficient to initiate an
investigation, the mere fact that an investigating authority initiated the investigation indicates that it
examined the evidence in th e application and determined that it was sufficient to justify initiation for
the purposes of Article 5.3. Mexico cites the EC-Bed Linen panel report in support of this
proposition.58 We note that the facts and legal issues in that case were different from the case before
us. In particular, in contrast to Guatemala's cl aim before us, India's claim in that case was purely
process-related; that is, India claime d that the European Communities failed to examine the accuracy
and adequacy of the evidence before initiating the in vestigation, but made no claim in respect of the
sufficiency of that evidence. 59 Although the EC-Bed Linen panel found that Article 5.3 does not
address the nature of the examination to be carried out , and does not require the investigating
authority to explain how it performed its examination 60, we do not read that case as standing for the
proposition implied by Mexico 61, namely that Article 5.3 imposes no substantive obligation upon an
investigating authority in respect of its assessment of the sufficiency of the evidence before it. Thus,
in our view, the findings of the EC-Bed Linen panel are not germane to the substantive issue before
us, which concerns Economía's assessment of the suffi ciency of the evidence be fore it at the time of
initiation.
7.21 Although there is no express reference to evidence of "dumping" or "injury" or "causation" in
Article 5.3, evidence on the three elements neces sary for the imposition of an anti-dumping measure
may be inferred into Article 5.3 by way of Article 5.2. In particular, Article 5.2 requires that the
application contain evidence on dumping, injury and causation, and Article 5.3 requires the
investigating authority to satisfy itself as to the accuracy and adequacy of "the evidence provided in
the application" to determine that that evidence is sufficient to justify initiation. Thus, reading
Article 5.3 in the context of Article 5.2 makes clear that the evidence to which Article 5.3 refers is the
evidence in the application concerning dumping, injury and causation. We note, as have past panels
in this context, that the meanings of the concepts of "dumping", "injury" and "causation" in Article 5

58 Panel Report, EC - Bed Linen, paras. 6.199-6.201.

59 See Panel Report, EC - Bed Linen, para. 6.200.

60 We note that the panel in Mexico - Corn Syrup (para. 7.102) similarly concluded that Article 5.3 did
not itself establish any obligation to make, or to make known, a determination concerning issues underlying the
decision to initiate.

61 Mexico's response to question 137 from the Panel.

are the same as those in the relevant substantiv e provisions of the Agreement (i.e., Article 2 for
dumping and Article 3 for injury and causation).
 62
7.22 We must emphasize, however, that while the c oncepts are the same, we agree with Mexico 63
that it is not necessary for an investigating authorit y to have irrefutable proof of dumping or injury
prior to initiating an anti-dumping investigation.64 We note in this respect that Article 5.1 refers to the
initiation of an investigation "to determine the existence, degree and effect of any alleged dumping"
(emphasis added), and that Article 5.2 refers to "alleged injury", the "allegedly dumped product" and
"allegedly dumped imports". We also are mindful that an anti-dumping investigation is a process
where certainty on the existence of all of the el ements necessary in order to adopt a measure is
reached gradually as the investigation moves forward. 65 While we disagree with Mexico that the
information contained in a request for initiation does not have to be more than a "mere indication"
("mero indicio ")66, we note that Mexico nevertheless acknow ledges that the investigating authority
must verify that the evidence presente d constitutes "reasonable indications" ( indicios razonables) in
order to initiate.67
7.23 Turning now in more detail to the provisions cited by Guatemala, we first consider
Article 5.2. Here, a claim under Article 5.2 may focus on whether an application contains information
"reasonably available" to the applicant , but the textual differences between Articles 5.2 and 5.3 lead
us to observe that the "reasonable availability" of the evidence to the applicant is not determinative as
to the "sufficiency", in the sense of Article 5.3, of that evidence as the b asis for an investigating
authority's decision to initiate. By the same token, in examining whether there is sufficient evidence
to justify initiation, an investigating authority is not precluded from gathering information additional
to that in the application so as to corroborate and verify the contents of the application.68
7.24 That said, the chapeau of Article 5.2 makes clear that in an application, "[s]imple assertion,
unsubstantiated by relevant evidence, cannot be considered sufficient to meet the requirements of this
paragraph." Therefore, for the purpose of Article 5.2, the applicant must submit a degree of actual
evidence of alleged dumping allegedly causing inju ry, and for the purpose of Article 5.3, that
evidence must constitute an objectively sufficient factual basis to initiate an investigation. While the
absolute threshold of sufficie ncy will depend upon the circumstances of a given case, Article 5.3
makes clear that the determination of sufficiency must be based on an asse ssment of the "accuracy"
and "adequacy" of the information. In this context, we are mindful that a piece of evidence that on its
own might appear to be of little or no probative value could, when placed beside other evidence of the

62 Panel Report, Guatemala - Cement II , para. 8.35; Panel Report, Argentina – Poultry Anti-Dumping
Duties, paras. 7.61, 7.62.

63 "... it is clear that such evidence does not necessarily have to be of the quality that would be
necessary to support a preliminary or final determinati on" (emphasis in original). First written submission of
Mexico, para. 9.

64 Panel Report, Guatemala - Cement II, para. 8.35.

65 Panel Report, Guatemala - Cement II , paras. 8.35, 8.36; Argentina – Poultry Anti-Dumping Duties,
paras. 7.61, 7.62.

66 Second oral submission of Mexico, para. 5(i).

67 See Mexico's response to question 136 from the Panel.

68 Panel Report, Guatemala – Cement II, para. 8.62; Panel Report, US – Softwood Lumber V ,
para. 7.75 (point not appealed).

same nature, form part of a body of evidence that, in totality, was "sufficient". We are, furthermore,
aware that it is appropriate for a panel to examine the evidence before the in vestigating authority at
the time of the decision in the light of the investigating authority's own methodology and to review
the decision on its own terms. As we have alr eady mentioned, we are not entitled to conduct a de
novo review of the investigating authority's determinations.
69
7.25 Turning to Article 5.8, this provision requir es the rejection of an application and prompt
termination of the investigation as soon as the aut horities concerned are satisfi ed that there is not
sufficient evidence of either dumping or injury to justify proceeding with the case. The portion of
Article 5.8 that applies to the pre-initiation phase of an anti-dumping investigation ("an application ...
shall be rejected ...") does not impose additional subs tantive obligations beyond those in Article 5.3
on the authority in connection with the initiation of an investigation. 70 That is, if there is sufficient
evidence to justify initiation under Article 5.3, there can be no violation of Article 5.8 in not rejecting
the application at that point.71
7.26 Recalling that Guatemala's claims under the thr ee provisions – Articles 5.2, 5.3 and 5.8 – are
focused on the alleged insufficiency of the info rmation on which Economía based its decision to
initiate, we first examine Guatemala's claims under Ar ticle 5.3. In so doing, and in accordance with
our standard of review, we will consider whethe r an unbiased and objective investigating authority,
taking into account the accuracy and adequacy of the facts before it, could properly have determined
that there was sufficient evidence to justify the initiation of an anti-dumping investigation.72
7.27 We will first examine Guatemala's allegations on the evidence concerning alleged dumping,
and then will take up Guatemala's a llegations on the evidence of alleged injury and causation. In this
regard, our approach will be consiste nt with that of past panels, which have evaluated claims as to an
authority's assessment of the suffici ency of evidence used for initiati on in the light of the pertinent
substantive requirements for dumping and injury determ inations (i.e., Article 2 for evidence related to
dumping and Article 3 for evidence related to injury). 73 We too shall look to those provisions not in
terms of consistency of the initiati on decision with them, but rather for guidance as to the substantive
sufficiency (in the sense of Article 5.3) of the evidence of alleged dumping and alleged injury on
which that decision was based. We reiterate that at the time of initiation an investigating authority is
not required to have before it the quantity and qua lity of evidence that would be necessary to support
a preliminary or final determination.
(i) Initiation evidence of dumping

7.28 We note first that Guatemala's complaint c oncerning the sufficiency of the evidence of
alleged dumping is limited to the evidence pertaining to normal value. That is, Guatemala raises no
issue concerning the evidence on export prices. (Thi s evidence consisted of the unit value of imports
of galvanized and black tubes and pipes based on SICMEX information for the period of

69 See e.g. Appellate Body Report, US – Countervailing Duty Investigation on DRAMS, paras. 141-152.

70 We find support in Panel Report, Guatemala – Cement II, paras. 8.72-8.75.

71 In response to questioning, Guatemala confirmed th at its Article 5.8 claim flows from its claims
under Article 5.2 and/or Article 5.3, both jointly and independently. See Guatemala's response to question 3
from the Panel.

72 This approach is similar to that of previous panels that have examined claims under Article 5.3 of the
Anti-Dumping Agreement. See, Panel Report, Mexico –Corn Syrup, paras. 7.91-7.110; Panel Report, Guatemala
– Cement II, paras. 8.29-8.58; Panel Report, Argentina - Poultry Anti-Dumping Duties, paras. 7.60 ff.

73 E.g. Panel Report, Guatemala - Cement II, paras. 8.35, 8.36 and 8.45.

investigation, as well as one customs document for each product group (galvanized and black,
respectively) with corresponding invoices, provided by Hylsa.
74) Guatemala does argue, however,
that the deficiencies that it alleges in the normal va lue evidence meant that th at evidence could not be
compared on a "fair" basis with the export price evidence.
7.29 Concerning the normal value evidence, Mexico's initiation notice indicates that Economía
generally accepted the evidence submitted by the a pplicant, without much further analysis or
elaboration: "The applicant suggested calculating th e normal value for both products [...], on the basis
of home-market sales prices in the Republic of Guatemala ..." 75; "For galvanized standard pipes and
tubes, the applicant submitted a sales invoice fro m a Guatemalan company corresponding to the
period of investigation."76; "For black standard pipes and tubes, the applicant supplied a quote from a
Guatemalan company corresponding to the period of investigation." 77 The Ministry accepted the
information provided by the applicant...".78
7.30 In particular, at the point of initiation, this evidence consisted of:
• one (apparently computer-generated) invoice for one sale, on 30 August 2000, by
Ferretería Ferrominera, a distributor, to Atlantida SA, of 1,200 pieces of "ligero"
galvanized (not black) steel pipes and tubes in three different diameters (1/2", 1" and
1-1/4").
79 At the average rate of exchange for 2000 80, the value of this sale was
approximately US$5,900.
• one (handwritten) price quote, dated 15 December 2000, by [XX - BCI.] , a
distributor, [XX - BCI] , for a total of [ XX – BCI] pieces of "liviano" pipes in 6
different diameters (1/2", ¾", 1", 1-1/2", 2-1/2", and 4"). 81 At the average rate of
exchange for 2000, the total value of the quoted products was approximately [ XX –
BCI]. The document does not specify whether these are black or galvanized pipes,
although Hylsa submitted it as evidence of pricing in the Guatemalan market for black
(i.e., not galvanized) pipe. This document explicitly indicates in large print that
"prices are subject to change".
7.31 It is apparent from the "prevención" that, prior to initiation, the Mexican investigating
authority made an effort to clarify certain aspect s of the normal value evidence (i.e., the invoice)
accompanying the application. First, the "prevenc ión" noted that the invoice covered only galvanized
pipes and requested clarification as to the pricing of black pipes. (It was in response to this question

74 Exhibit GTM-4, para. 55.

75 Exhibit GTM-4, para. 61.

76 Exhibit GTM-4, para. 62.

77 Exhibit GTM-4, para.63.

78 Exhibit GTM-4, para. 65.

79 See Exhibit MEX-1. In particular, 1,000 pieces 1/2" x 6 mts.; 100 pieces 1" x 6 mts; 100 pieces
1-¼" x 6 mts.

80 http.//www.worldpress.org/prof iles/Guatemala.cfm. The source cited by Worldpress for the
exchange rate information (7.7632 quetzales per US dollar in 2000) is the CIA World Factbook.

81 In particular, prices were quoted for 3-14 units, 6 me ters in length, of each of the various diameters.
½, ¾, 1, 1 ½, 2 ½, 4 inch tubes. See Exhibit MEX-26.

that Hylsa submitted the price quote.) The "prevenci ón" also asked why the in voice was in respect of
a Guatemalan company (Ferretería Ferrominera) othe r than the exporter, Tubac, identified in the
application82, and sought details concerning the domicile of Ferretería Ferrominera (noting that the
document indicated that the buyer was located in Guatemala, but not the vendor), and about exchange
rates.
83 The "prevención" further asked why there was, originally, no adjustment for credit terms,
despite the fact that the invoice indicated that Fe rretería Ferrominera had granted 30 days credit.
Economía largely accepted Hylsa's responses to these questions, including an adjustment for credit
terms and a modification of the exchange rate used.84
7.32 We now consider, in the light of the specific arguments raised by Guatemala, whether an
unbiased and objective investigating authority, lookin g at these facts, could properly have determined
that there was sufficient evidence of dumping to justify the initiation of an anti-dumping investigation.
7.33 Guatemala argues that the invoice and the pric e quote were insufficient for the following
reasons: (1) that the prices were not those of Tubac, the one known and named Guatemalan exporter,
which accounted for nearly all Guatemalan exports to Mexico, but were those of two Guatemalan
distributors; (2) that the evidence related to an "insignificant subset" of the investigated product
temporally, and in terms of volume and product cove rage, in that the evidence corresponded to only
one single transaction and one single price offer on two individual days during the period of
investigation, the volumes involved were very small, and the product coverage was very limited vis-à-
vis the overall scope of the domestic product, and indeed did not reflect the specific product (A-53
pipe) identified in the application as the investigat ed product; (3) that no adjustment was made by
Economía to take into account the level of trade (d istributor) of the emitters of the invoice and price
quote; and (4) that the price quote, not representing a completed transaction, was inherently invalid as
evidence. Thus, for Guatemala, the problems with both the quantity and the quality of the evidence
were such that a proper assessment of it by Economía could not have resulted in a decision to initiate
the investigation.
7.34 Given these allegations by Guatemala, we have considered in detail the normal value
evidence, and have identified a number of inter-related concerns in respect of: the sufficiency of the
nexus with producer/exporter pricing in the Guatemalan home market for the product under
investigation; the isolated nature of the inform ation in terms of temporal coverage, volume, and
product coverage; and, as a result, the comparability of this evidence with that on export pricing. We
emphasize that our assessment is in respect of th e normal value evidence as a whole that was before
the investigating authority, with no one of the various concerns that we outline below necessarily
being determinative.
7.35 First, we note that, as alleged by Guatemala, none of the normal value evidence pertained to
Tubac, the only identified exporter, which accounted for almost all production and exports of the
investigated product; instead, the evidence pertained to two distributors. Mexico does not dispute that
the prices in the invoice and price quote were not T ubac's, and instead argues that these prices were
reflective of prevailing prices in Guatemala. We do not here mean to imply that, at the stage of
initiation, an investigating authority must have pricing documentation from every domestic producer

82 In particular, Exhibit GTM-2, Question 18 reads: "Please explain why Annex 2 refers to Tubac SA
as having issued the invoice presented for the purposes of substantiating the normal value, since the invoice in
question (Annex 2.1) is that of the company Ferretería Ferrominera."

83 See Exhibit GTM-2, Questions 18-23, and responses thereto in Exhibit GTM-3.

84 For the invoice, Mexico applied the exchange rate published by the Bank of Guatemala for the date
of the invoice, rather than the average monthly rate from the same source proposed by the applicant. For the
price quote, Mexico applied the exchange rate for the date of the quote, rather than the average rate proposed by
the applicant.

or exporter, or even any domestic producer or exporte r. Indeed, we recognize that it can be extremely
difficult for an applicant to obtain evidence of hom e market pricing, especially from its competitors,
the producers or exporters. Nevertheless, dumping is a company-specific practice, and this is
reflected in the Agreement's provisions concerni ng the determination of dumping in respect of
particular producers or exporters (see, e.g., the vari ous references in Article 2.2 to "the exporter or
producer investigated"
85, and the requirement in Article 6.10 to calculate dumping margins for
individual producers or exporters 86). Where, as is the case here , it is obvious on its face that the
normal value evidence before the authority at the ti me of initiation does not pertain to a producer or
exporter and indeed pertains to a different level of trade, and may not even reflect products produced
in the exporting country, the authority should make its best endeavours to verify that that evidence
reflects the prevailing home market pricing at the level of producers and/or exporters.
7.36 In this case, Mexico has pointed to no eviden ce, and indeed does not argue, that Economía
took any steps to determine whether the products reflected in the invoice and price quote were
reflective of Tubac's prices – in spite of the f act that Tubac was the only identified Guatemalan
producer or exporter of the product – or even that these products were of Guatemalan origin. 87 Nor
does Mexico point to any evidence, or argue, that Economía asked Hylsa to confirm the Guatemalan
origin of the products reflected in the invoice and price quote, or to provide any information as to
whether and how these prices should be adjusted to reflect the producer/exporter level (e.g., by
subtracting an amount for distributor mark-up).
88
7.37 Second, the temporal, volume and product coverage of the evidence was extremely limited
and isolated, such that in our view this evidence wa s reflective of only an insignificant subset of the
product and prices in question. In respect of temp oral coverage, the invoice relates to only a single
isolated transaction on a single day, and the price qu ote also relates to only a single isolated potential
transaction that could have taken place on a single day. There is no dispute that the dates of the
invoice and the price quote were both within the peri od of investigation, but the fact that the home

85 For example, Article 2.2.2.1 ("costs shall normally be calculated on the basis of records kept by the
exporter or producer under investigation ") (emphasis added); Article 2.2.2 "the amounts for administrative,
selling and general costs and for profits shall be based on actual data pertaining to production and sales in the
ordinary course of trade of the like product by the exporter or producer under investigation") (emphasis added);
and the subparagraphs of Article 2.2.

86 Article 6.10 stipulates: "The authorities shall, as a rule, determine an individual margin of dumping
for each known exporter or producer concerned of the product under investigation ...".

87 Response of Mexico to question 17 from the Panel. For example, (question 17(c)) we asked Mexico
whether, in its assessment of the qua lity and accuracy of the submitted evid ence, Economía had inquired as to
what kind of company Ferretería Ferrom inera was, and to cite the relevant portion of the record. Mexico's
answer does not indicate that Economía undertook any such an alysis. Rather, Mexico simply states that "[I]t is
a company that sold the investigated goods at issu e in the Guatemalan market during the period of
investigation". We also asked Mexico (question 17(e)) what specific steps Economía had taken to assure itself
that the products reflected in the in voice were produced in Guatemala, and to cite the relevant documentation.
Again, Mexico points to no steps taken by Economía, but simply replies that Economía "found that those were
the prices actually applied in the Guatemalan market during the period of investigation".

88 See Mexico's response to question 17(h) from the Panel. Mexico did not respond to our question as
to level of trade adjustments, but instead indicated that the invoice prices were adjusted for credit. (The terms of
the invoice included 30 days credit.) We note as well that although in the "prevención" Economía asked Hylsa
to clarify "how it was ascertained that there were no ... adjustments applicable to the normal value" other than
the credit adjustment, Hylsa did not respond to this questio n. There is no evidence, and Mexico does not argue,
that Economía followed up with Hylsa in respect of this non-answered question, in any way or at any time
during the investigation.

market pricing evidence for each broad product sub- group (i.e., galvanized and black pipe) pertained
only to a single day out of the six-month-long period of investigation raises substantial questions as to
whether that evidence was representa tive of pricing during that period as a whole. Mexico does not
argue, and there is no evidence, that Economía sought confirmation from Hylsa that, or made any
other effort to determine whether, this evidence wa s representative of the period as a whole. In fact,
Mexico confirmed to us the contrary, stating that "since the information submitted by the applicant
was dated within the period of investigation, [Economía] did not require additional normal value
information".
89 Mexico appears to be arguing, in other words, that so long as a piece of evidence is
dated within the period of investigation, even if it represents only a single day during that period, this
information is – by definition, and without more – sufficiently representative of the period of
investigation as a whole for purposes of initiation. We disagree since it is indeed quite possible that
an individual, isolated transaction may be an ab erration from the typical prevailing prices and/or
conditions, and therefore if the applicant has provi ded only such temporally isolated evidence, the
authority should not assume without some corrobora tion that this evidence is representative of the
period as a whole.
7.38 Concerning product volume and coverage, the normal value evidence was similarly limited
and isolated. In particular, the transaction in the invoice was for 1,200 pieces of galvanized pipe with
a total weight of about 8,000 kg 90 and a total value of about US$6,0 00, and the products were in only
three diameters (1/2", 1" and 1-1/4") of a single wa ll thickness schedule ("ligero"). The coverage of
the price quote was even more limited, as it reflected just [XX - BCI] pieces of black pipe weighing a
total of about [XX - BCI]91, with a total value of a mere US$ [XX - BCI]. While the products were in
six diameters (1/2", ¾", 1", 1-1/2", 2-1/2" and 4"), all were of a single wall thickness schedule
("liviano"). The extreme limitation of the size ranges covered by the invoice and price quote is
evident from a comparison with the size range of c overed products of Guatemalan origin identified by
Hylsa in its response to the "prevención". 92 In particular, in that submission, Hylsa identified a total
of 62 dimensions (i.e., diameter and wall thickness combinations). Taking into account that each of
these dimensions could apparently exist in both ga lvanized and black finish, at the moment of
initiation Economía had information that there could be a total of 124 different products. Given the
very substantial variati ons among these dimensions (a range of ½" diameter with a wall thickness of
0.095" to 4" diameter with a wall thickness of 0.237") we do not see on what basis it was possible for
Economía to have assumed, with no further inquir y or corroboration, that the very small subset
reflected in the invoice and price quote, was repres entative of the prices for the overall investigated
dimensional range. Furthermore, as inferred by Guatemala and confirmed by Mexico, all of the
products covered by the invoice corresponded to BS-1387 pipe.
93,94 In other words, the products did

89 Mexico's response to question 17(g) of the Panel.

90 Derived from the conversion factors in Annex 15 to Hylsa's reply to the "prevención". Before us,
Mexico argues that Economía had consid ered the invoice to be representativ e in terms of volume because the
size of the transaction involved was several times larger than the average size of Tubac's home market sales as
reflected in Tubac's response to the exporter's questionnair e. This argument is irrele vant to the present claim,
however, given Economía's total lack of any information relating to Tubac's home market sales at the time of
initiation.

91 Derived from the conversion factors in Annex 15 to Hylsa's reply to the "prevención".

92 Exhibit GTM-3, answer to question 16.

93 Guatemala's response to question 7 of the Panel.

94 Mexico's response to question 174 of the Panel.

not correspond to the A-53 specification, which the application identified as the predominant product
among the investigated merchandise.
7.39 Here again, there is no evidence, nor does Mexico argue, that before initiation either Hylsa or
Economía undertook to establish that the prices for the dimensions of pipe in the invoice and price
quote were representative of the range of sizes covered by the investigation, or that the prices for BS-
1387 pipe were representative of a broader range of specifications of investigated products, in
particular of the predominating A-53 pipe. Nor is there evidence that either Hylsa or Economía
sought information that might have been needed to adjust those prices to make them so representative.
We asked Mexico: "Is there any indication in the Initiation Determination or in the record that
Economía assessed whether the pip es in the invoice and the price quote might be considered to be
sufficiently representative of the product at issue?" Mexico responded that Economía had analysed
the invoice and the price quote and found that "the prices given in both sources correspond to the
investigated merchandise, are for the Guatemalan market, and were in effect during the period of
investigation".
95 We view this as an argument by Mexico that so long as a piece of evidence pertains
to some part (no matter how restricted) of the produc t range covered by an application, that evidence
– by definition and without more – is sufficiently representative of th at product range for purposes of
initiation. Again, we cannot agree with such a pr oposition. Where the evidence pertains to only a
thin sliver of a broad overall product range , the authority should not assume without some
corroboration that this evidence represents pricing for the full product range.
7.40 As in respect of company and temporal re presentativity of the evidence at the time of
initiation, we do not mean to suggest at all that an investigating authority must have documentary
evidence relating to every individual product covered by a given application. Rather, our view is that
where the product coverage of the evidence, as here, is quite limited, the investigating authority needs
to take the appropriate steps to determine whether that evidence is representative of the full product
range, and to seek further information, including as to any adjustments, that would be necessary to
render it so representative.
7.41 We emphasize here that we disagree with Guat emala's argument that the price quote, because
it did not represent a completed transaction and becau se of its indication that the quoted prices were
subject to change, was inhe rently invalid as evidence. 96 We have discussed above our concerns as to
the lack of evidence that the particular price quote that was before Economía was representative of
home market pricing for the range of Guatemalan-p roduced products covered by the scope of the
investigation for the period of investigation. These concerns have to do with the specifics of that
particular price quote, and not with the probative value of price quotes as such. Indeed, in another
case there could well be a situation where adequa tely corroborated and representative price quotes
constituted sufficient evidence of alleged dumping.
7.42 Finally, we recall that although Guatemala has not raised any concerns in respect of the
evidence on export prices that was before Economía, it has argued that the problems it identified in
respect of the normal value evidence, as discussed above, would have meant that any comparison of
that evidence and the evidence of export pricing (i .e., the calculation of the alleged dumping margin)
was not "fair" in the sense of Article 2.4. We share the concern raised by Guatemala over the
comparability of the evidence on normal value with that on export pricing. In particular, we recall

95 Mexico's response to question 19(c) from the Panel.

96 First written submission, para. 74. We note also Guatemala's argument in its rebuttal submission that
price quotes have no legal status within Guatemala's domestic legal framework. In response to Panel
questioning on this issue, Mexico asserted that the domestic legal status of pr ice quotes in Guatemala was
irrelevant, "given that, regardless of the obligation to apply the agreed price, a price quote obviously provides a
reasonable indication of market selling prices". See Mexico's response to question 144 from the Panel.

that there is even no evidence that the merchandi se in the invoice or price quote was of Guatemalan
origin, and that the invoice and the price quote each represented distributor-level prices for a single
transaction or potential transaction on a single day, for an extremely small subset of the products
covered by the investigation, including the fact that this subset was limited to a technical specification
other than the one identified by the application as the predominant specification in the market. By
contrast, the export price information reflected the full spectrum of products imported by Mexico
from Guatemala, over the entire period of investigati on, at the level of the Guatemalan producer or
exporter. Differences of this kind – which, we emphasize, are evident from the face of the evidence in
question – typically lead to a distortion of the normal value vis-à-vis the export price, and thus if not
adjusted for could give rise to apparent margins of dumping where no dumping in fact exists. Yet,
according to the notice of initiation, the only adjust ments that were made to the normal value and
export pricing evidence (i.e., the credit ad justment to the prices in the invoice 97 and credit, freight and
insurance adjustments to the export pricing evidence 98) had nothing to do with the problems that we
have identified. It is thus clear to us that af ter making these (unrelated) adjustments, Economía based
its determination of the sufficiency of the ev idence of the existence of dumping on a simple
comparison of the prices that appear in the invoice and price quote with the export price information.
Nor is there any evidence, and Mexico does not ar gue, that Economía took any steps to consider
whether any further adjustments would have been necessary to take into account in the price
comparisons the above-identified problems in the nor mal value evidence, so as to ensure that the
allegation of dumping was well-founded.
7.43 We have carefully reviewed the record as to the evidence of dumping that was before
Economía at the time of the initiation. We consider that the above-discussed problems in the evidence
pertaining to normal value (the invoice and the price quote) are obvious on the face of those two
documents and thus should have been, but were not, taken into acc ount in Economía's assessment of
the sufficiency of the evidence of dumping. Given these obvious problems in the normal value
evidence, which were neither resolved nor addr essed by Economía, in our view an unbiased and
objective investigating authority could not have concluded that there was sufficient evidence of
dumping to justify the initiation of an anti-dumping investigation under Article 5.3. We therefore find
that Economía did not act consistently with Mexico 's obligations under that provision in performing
its assessment of the sufficiency of the evidence of dumping.
(ii) Initiation evidence of injury
7.44 Guatemala asserts that the Mexican investig ating authority did not properly examine the
adequacy and accuracy of the evid ence relating to injury – in part icular, the volume of the dumped
imports – to ensure that it was sufficient to justify initiation for the purposes of Article 5.3 of the Anti-
Dumping Agreement . Rather, according to Guatemala, the investigating authority accepted the
evidence submitted by the applicant concerning total import volumes for the two tariff lines
concerned without any independent evaluation, and with no downward adjustment for products
imported under the same tariff lines that were not covered by the application.
7.45 To recall, in the application, as evidence of the volume of the dumped imports, Hylsa
submitted the statistics published by SICMEX on th e total volume of imports under the two tariff
lines (7306.30.01 and 7306.30.09) within which the pr oducts named in the application were imported.
There is no disagreement between the parties that th e import information at the tariff-line level that
was before Economía at the time of initiation included the products under investigation. The issue
raised by Guatemala is that because Hylsa a nd Economía recognized, as of the time that the

97 Initiation Determination, (Exhibit GTM-4), para. 67 . For the price quote, no credit adjustment
apparently was needed, as it specified cash payment.

application was submitted, that this information also covered an unidentified volume of non-
investigated products, the information was insuffici ent as evidence of the volume of the allegedly
dumped imports, for purposes of initiation.
7.46 Turning first to the application, Hylsa's response to question 6 of the application questionnaire
format gives the first indication of this issue. The question reads:
"In the event that the tariff lines indicated include products other than
the investigated product, the following information should be
provided: (a) what are the products in question; (b) what, in your
estimation, is the share of the investigated product in total imports
entering under these lines; (c) an explanation of the methodology
used and calculations made for the purposes of your estimate."
99
Hylsa responded:

"(a) As concerns tariff line 7306.30.01 (galvanized), there are pipes
and tubes corresponding to the tariff line description, under which
galvanized structural tubing and conduit tubing can be found. As to
tariff line 7306.30.99 (black), there are pipes and tubes corresponding
to the tariff line description, under which black structural tubing can
be found. (b) Hylsa has no basis for making an estimate or
calculating the percentage of impor ts of other products entering
under those lines. (c) N/A".
100
Thus, the application makes clear Hylsa's admission that the description of the products classified
under the two relevant tariff lines was broader than th e applicant's description of the product that was
the subject of the application (by virtue of including structural and conduit tubing), but that Hylsa
could make no estimate of the amount of imports of those non-investigated products.

7.47 Economía pursued this issue in the "prevenci ón" with a view to establishing the respective
proportions of the total imports entering under the ta riff lines concerned that were accounted for by
the product under investigation and by non-investigat ed products. In particular, the "prevención"
asked whether the structural and conduit tubing re ferred to in the answer to question 6 of the
application format were subject to the investigati on and requested Hylsa, if they were not, to submit
an estimate of the amount of the total imports under the two tariff lines accounted for by the non-
investigated product.
101 Hylsa's responses (as contained in th e public version of its reply to the
"prevención" and as indicated in Me xico's answers to Panel questioning 102) appear to confirm that the
structural and conduit tubing were not covered by the investigation, but also that Hylsa had no basis to
estimate the amounts of these non-covered products, as follows:
"Both lines cover imports of black and ga lvanized conduction pipe and tubing and
black and galvanized structural pipe and tubing, in addition to conduit tubing. The
tariff line description is very broad, and bot h black structural pipe and tubing and

99 Exhibit GTM-1, Sección I.A, question 6.

100 Ibid.

101 Exhibit GTM-3, questions 3 and 4.

102 Exhibit GTM-3, answer to question 4. Mexico's response to Panel question 9(d) provides the text
that was omitted as confidential information from the public version of Hylsa's response to the "prevención"
contained in Exhibit GTM-3.

black conduction pipe and tubing enter under the same line, i.e., 7306.30.99.
Galvanized conduction pipe and tubing and galvanized structural pipe and tubing
enter under the same line, i.e., 7306.30.01. This greatly restricts the ability to
estimate imports of the aforementioned pipes and tubes. The use made of the pipes
and tubes cannot be determined on the basis of Hylsa-DAT’s internal data. Annex 3.
No relevant information was obtained fo r a formal analysis, because even though
some of the importers were known, the total amount of the imports was not. Annex 3
contains no information."
The initiation notice confirms that Hylsa was unabl e to provide any information in response to
Economía's request for further precision as to th e respective amounts of investigated and non-
investigated products imported under the two tariff lines: "In fact, the Ministry noted that in order to
describe the trend in the imports under investigatio n in the period July-December 2000 in relation to
the previous comparable period, the applicant c onsidered the total amount of imports entering the
domestic market under the tariff lines in question."
103 Thus, it is clear to us (and Mexico does not
contest) that Hylsa provided no information as to this product breakout.

7.48 In response to Panel questioning as to any step s other than the "prevención" (which, as just
discussed, yielded no clarification) that were ta ken by Economía to identify the volume and value of
the investigated products contained within the data for the two tariff lines, Mexico indicated that
Economía had used the official SICMEX statistics firs t to verify the totals for the two tariff lines as
reflected in the application and then to conduct its analysis of the trends in imports for purposes of
initiation. In particular, Mexico stated that:
"The investigating authority first of all analysed the import volume data provided by
the applicant and noted that the amounts corresponded to the imports recorded for
tariff lines 7306.30.01 and 7306.30.99"104;
and further that:
"Thus, the investigating authority used its own statistics drawn from official import
sources to carry out the assessment under Article 3.1 and 3.2 of the Anti-Dumping
Agreement and other provisions".105
7.49 Mexico also underlined to the Panel, however, that these official data were no more detailed
as to product breakouts than the tariff-line level (i.e., than the level of detail in the application). In
particular, Mexico stated:
"It is important to note, moreover, that the investigating authority has access to
official import statistics available from the Ministry of the Economy’s Mexican Trade
Information System (SIC-M), which is at th e eight-digit level (i.e., two more than the
Harmonized System), it being understood that, likewise, there are no official import
data at the specific "product code" level (so that data at the tariff line level provide the
narrowest range that includes the investigated product)."
106

103 Exhibit GTM-4, para. 92.

104 Mexico response to question 9(d) from the Panel.

105 Ibid.

106 Mexico response to questions 9(d) and (e) from the Panel.

7.50 In response to a question from the Panel as to whether in respect of the import data, Economía
had limited itself to the above-described verification that the data in the application were the same as
those published by SICMEX for the two tariff lines, although Mexico said that this was not the case, it
pointed to no other concrete steps taken by Economía. Mexico nevertheless argued that:
"[...] the authority’s assessment of the imports is to be viewed as a harmonious whole
made up of a number of interconnected elem ents which together provide a reasonable
basis for the determination to initiate the i nvestigation. In particular, it should be
noted that the evidence adduced by the app licant (in the request for initiation and in
its responses to the "prevención") permitted Economía to link the statistical data from
the tariff lines to the trends in the impor ts under investigation (including volumes,
values, or tendencies) in a reasonable manne r. According to the IA, such evidence
must be assessed on the basis of logic, knowledge and acquired experience".
107
7.51 The Initiation Determination confirms that fo r purposes of initiation, for information on the
volume and value of imports of both the allegedly dumped imports and total im ports of the relevant
products, Economía relied upon the official SICMEX st atistics at the tariff line level, unadjusted in
any way to exclude the non-investigated products al so reported under those tariff lines. In particular,
the notice of initiation states:
"The indications received from the applican t did not provide the Ministry with the
information enabling it to estimate, for the period of investigation and the two
preceding similar periods, the share of imports of black and galvanized standard pipes
and tubes in the total volume of imports under tariff lines 7306.30.01 and 7306.30.99
of the Schedule of the General Import Duty Law."
108
7.52 The disussion in the notice of initiation in regard to the volume, trends and market share of
the allegedly dumped imports was explicitly based on the totals reported for the two tariff lines, as
follows: 109
"... in order to assess whether the period of investigation saw an increase in total
imports and in imports from the Republic of Guatemala in relation to domestic
consumption and production, the Ministry es timated the size of the standard pipe and
tube market on the basis of apparent dom estic consumption, defined as the sum of
domestic production and total imports less to tal definitive exports. Total imports
were obtained as specified under point 98 of this Resolution. As regards domestic
output and total exports, the Ministry examined the figures provided by the applicant,
obtained from the National Chamber of the Iron and Steel Industry.
In this connection, the Ministry noted th at, during the period of investigation, the
share in Mexico’s standard pipe and tube market of total imports under tariff lines
7306.30.01 and 7306.30.99 of the Schedule of the General Import Duty Law grew by
10 percentage points in relation to the previous comparable period, rising from 28 to
38 per cent. As to imports from the Republic of Guatemala, the Ministry noted that,
in the period July-December 2000, their shar e in domestic consumption increased by

107 Mexico response to question 9(e) from the Panel.

108 Guatemala – Exhibit GTM-4, para. 97.

109 Initiation Resolution, Exhibit GTM-4, paras. 103-104. The data in the application pertained to the
July-December periods of 1999 and 2000.

2 percentage points in relation to the previous comparable period, from 5 to
7 per cent. In relation to domestic production, imports from the country under
investigation accounted for 7 per cent in the period July-December 1999, reaching
11 per cent during the period of investigation."
7.53 While the notice of initiation makes thus clear Economía's recognition that it had no
information as to the proportion of the total impor ts under the two tariff lines that were accounted for
by the products subject to the application, the notice also indicates that Economía intended to take
further steps during the investigation to estimate this info rmation, as indicated in the following
passage:
"As the next step in the procedure, the Minist ry will assemble the relevant information for an
estimation of the volume of black and galvanized standard pipes and tubes that entered the
domestic market under tariff lines 7306.30.01 and 7306.30.99 ... during the period of
investigation and the two previous comparable periods."
110
7.54 Recalling our view of the nature of the obliga tion imposed by Article 5.3, we see the issue
before us as whether an unbiased and objective investigating authority could properly have
determined that the evidence on import volumes of the allegedly dumped imports that was before
Economía was sufficient in the sense of Article 5.3 for purposes of initiation of the investigation.
7.55 The WTO obligations of a Member's anti-dumping investigating authority are set out in the
Anti-Dumping Agreement. We agree with Mexico that a Memb er's investigating authority has a
certain degree of discretion to initiate and conduct an anti-dumping investigation, and is not subject to
obligations that are not contained in the Agreement. That said, and as discussed at length above, the
Agreement (Article 5.3) requires an investigating authority, before taking a decision to initiate an
investigation, to satisfy itself as to the sufficiency of the evidence (in this case pertaining to injury)
before it.
7.56 In this regard, the provisions of Article 3 pr ovide pertinent guidance. In particular, the
concept of the "dumped imports" is a centrally importa nt and integral element of the entire analysis of
injury and causation as provided for in Article 3. Article 3.1, an overarching provision pertaining to
injury determinations as a whole, requires positiv e evidence and an objective examination of both
(a) the volume of the dumped imports and their effect on prices in the domestic market for like
products, and (b) the consequent impact of the dumped imports on domestic producers of the like
products. Article 3.2 concerns the determination of the volume of dumped imports, and their effect on
prices, and Articles 3.4 and 3.5 concern the impact of dumped imports on the domestic industry
producing the like product, and causality between dumped imports and injury. Articles 3.6, 3.7 and
3.8 also contain numerous references to dumped imports and their impact. While, again, we do not
mean to suggest that an investigating authority must have before it, at the time it initiates an
investigation, injury-related evidence of the quantity and quality that would be necessary to support a
preliminary or final determination of injury, it is clear that the authority must have before it the same
type of evidence of injury as defined in Article 3, including as to the volume of allegedly dumped
imports, sufficient to justify the initiation of an investigation.
7.57 In this regard, the question before us is whether Economía complied with the obligations
under Article 5.3 in assessing the sufficiency of th e evidence pertaining to injury by basing its
assessment of the volume of the allegedly dumpe d imports on the published data for total import
volumes reported for two entire tariff lines, while be ing aware that those tariff lines also included an
undetermined quantity of other products not the subj ect of the application. In other words, did
Economía, in accepting this published aggregate in formation as a proxy for the volume of the

110 Exhibit GTM-4, para. 99.

allegedly dumped imports, fail to comply with the requirement of Article 5.3 in respect of the
sufficiency of this evidence for the purpose of initiation?
7.58 We take note of Mexico's argument that "the authority’s assessment of the imports is to be
viewed as a harmonious whole made up of a numbe r of interconnected elements which together
provide a reasonable basis for the determ ination to initiate the investigation."
111 We are aware that
Economía had other evidence pertaining to the product under investigation before it, including
information pertaining to the "'Description of the su bject product' (technical or trade names by which
the product is known, physical and technical char acteristics, composition, production process, uses
and users, including, moreover, manufacturing sta ndards, diagrams of the manufacturing process,
quality certification for both the Guatemalan a nd the domestically manufactured product, etc." 112
However, in respect of the volume of dumped imports, we do not see the relevance of this other
information. Furthermore, it is not disputed that , for the purposes of initiation, having been informed
by the applicant that it did not have any way to more precisely estimate th e volume of the covered
products within the two tariff lines, Economía relied ex clusively upon statistics at the tariff line level,
without making any estimation of the proportion thereof accounted for by the product under
investigation. In other words, Economía recognized that it did not know, at the time it took the
decision to initiate, anything about the percentage of the tariff line totals accounted for by the
investigated products. For this r eason, Economía also had no basis on wh ich to consider the trends in
the total volume of imports under those tariff lines as in any way representative of the trends in the
volume of the allegedly dumped imports. In particular, while the trends in total imports might well be
representative of the trends in the subject imports if the latter accounted for a large percentage of the
former, this would not necessarily be the case where the subject imports were only a small percentage
of the total.
7.59 In short, we disagree with Mexico that the information provided by the applicant may have
permitted Economía to link the statistical data from en tire tariff lines to the trends of investigated
imports in a reasonable manner on the basis of logi c, knowledge and acquired experience, as we see
nothing in the record that was before Economía at the time of initiation establishing or addressing
such a link. 113 We do not consider that it was suffici ent for Economía not to find some reasonable
basis to estimate the proportion of total imports ac counted for by the product under investigation at
the initiation stage. For example, we note that Economía obtained import "ped imentos" relating to a
certain number of import transactions at later stages of the process. 114 This confirms to us that there
would have been at least one way that Economía mi ght have sought to corroborate the import volume
statistics as they related to the product under investig ation. We disagree with Mexico's argument that
requiring, at the initiation stage, some corroboration of the import volume at the tariff line level that
related to the product under inv estigation is tantamount to impos ing a requirement that initiation
evidence of the same quality and quantity as eviden ce required to sustain a preliminary or final
determination. Again, it is the type of evidence of injury which is our focus here.115
7.60 For these reasons, in the circumstances of th is case, we consider that an unbiased and
objective investigating authority, in relying on the ev idence in question, i.e., the official statistics of

111 Mexico's response to question 9(e) from the Panel.

112 See Volume 1, Section I.A of the application in Exhibit GTM-1.

113 Mexico response to question 9 (e) from the Panel, quoted at paragraph 7.50, supra.

114 See, for example, Preliminary Determination, Exhibit GTM-10, paras. 120-123; and Final
Determination, Exhibit GTM-23, para. 169.

115 See para. 7.56 supra.

total imports under the two tariff lines concerned, as evidence of the volume of dumped imports –
without cross-checking (even in an approximate manner) the proportion of those tariff line import
data that corresponded to the product under investig ation – could not properly have determined that
there was sufficient evidence of in jury to justify the initiation of an anti-dumping investigation in
relation to the product under investigation. The fact that, during the course of the investigation, it was
ultimately confirmed that the investigated pr oduct (however this was eventually defined
116) appeared
to account for a substantial portion of the imports under the two tariff lines is not relevant to our
examination under Article 5.3. 117 What is relevant is what facts were known to the investigating
authority at the time that it initiated the investig ation. We see no basis on the record for Economía to
have concluded that the total volumes at the tari ff line level constituted a reasonable proxy for the
volume of the allegedly dumped products during the pe riod of investigation. We therefore find that
Economía did not act consistently with Mexico's obligations under Article 5.3 in performing its
assessment of the sufficiency of the evidence of injury.
7.61 As there was no proper determination that there was sufficient evidence of dumping or injury
to justify proceeding with the case under Article 5.3, the application should have been rejected and the
investigation should not have been initiated by the term s of Article 5.8. In light of our findings of
violation of Articles 5.3 and 5.8, we do not cons ider that it is necessary for us also to examine
Guatemala's claim under Article 5.2.
C. FACTS RELATING TO DEFINITION OF PRODUCT UNDER INVESTIGATION/LIKE PRODUCT
7.62 Guatemala raises a number of claims that are based on its factual allegation that at two points
during the investigation, Ec onomía expanded the definition and scope of the product under
investigation. Briefly, Guatemala claims that in spite of changing the scope of the products covered
by the investigation – and thus, eventually, t hose covered by the anti-dumping measure – Economía
never investigated the added products in respec t of either dumping or injury. Concerning the
dumping finding in particular, Guatemala alleges that although Tubac was not requested to provide
any data concerning the added products, the fact th at it did not do so was one of Economía’s main
reasons for rejecting Tubac’s data and resorting to facts available in calculating the definitive margins
of dumping. Similarly, in respect of the injury and causation determinations, Guatemala alleges that
Economía did not gather, collect nor analyse data pertaining to the expanded product definition.
7.63 Before turning to the specifics of Guatemala's claims concerning the alleged changes to the
scope of the investigated products, we start by cons idering the basic factual issue, i.e., whether the
facts of record, as presented to us in this dispute, indicate that Economía modified the scope of the
investigation as argued by Guatemala.
7.64 In its first written submission, Mexico appeared to admit that the two changes alleged by
Guatemala did take place. Concerning the first alleged change, the expa nsion of the range of
diameters of pipe covered by the investigation from 1/2"-4" to 1/2"-6", Mexico stated in its first
submission that: " (d) [o]nly the diameter of the pipes and tubes investigated was modified "118 and
that "a 2-inch increase in diameter does not signify that the Ministry made a substantial alteration in

116 We refer to our discussion of the changes in product definition in the course of the investigation ,
infra.

117 For example, para. 165 of the Final Determination indicated that in the periods
July-December-1998, 1999 an d 2000, the investigated product acc ounted for 79, 66 and 64 per cent,
respectively, of tariff-line import volumes.

118 First written submission of Mexico at paragraph 91(d) (emphasis added).

the description of the product under investigation"
119, and that "the Guatemalan exporter had every
opportunity to raise any objection it saw fit to the change in question". 120 Concerning the second
alleged change, the addition of certain structural tubing to the scope of the investigated product,
Mexico stated in its first submission that: "the scope of the product under investigation was not
generically expanded to include "structural" pipes and tubes, but merely pipes and tubes that were
technically and commercially interchangeable w ith those possessing the following characteristics
…". 121 Mexico made similar statements in its first oral statement. 122 Furthermore, in response to
questions from the Panel following the first substa ntive meeting of the Panel, Mexico acknowledged
that these modifications had been made (although it referred to them as "clarificatory adjustments"
(precisiones), "clarifications" ( clarificaciones), or "ajustments" ( ajustes)).
123 Mexico defended these
modifications on the grounds that Economía, not being an expert in pipe and tube products, found it
appropriate to make these changes or clarifications to the product scope in the light of information
that it progressively gathered over the cour se of the investigation as to the commercial
interchangeability of the products. However, Mexico al so made such statements as: "they are one and
the same [product]"124; "it is the same product"125; and "it is the same merchandise". 126 Furthermore,
during the second substantive meeting Mexico in an oral comment to the Panel denied that Economía
had changed the definition of the investigated product.127
7.65 Because of these differing statements by Mexico as to whether in fact Economía had changed
the scope of the investigated pr oduct (1) by increasing the maximum diameter covered from 4" to 6",
and (2) by adding certain structural tubing to the pro duct definition, we cannot conclude that this is an
uncontested fact in this dispute. Accordingly, a nd because of the central importance of this factual
issue to many of Guatemala's claims, we now consider in detail the record evidence that pertains to
this point.
1. The application (GTM-1)
7.66 The application by Hylsa described the produc t subject to the application as black and
galvanized "standard pipe and tube" produced unde r various technical standards, the most important
being ASTM A-53 and BS-1387. The application st ated that these products, which were known in

119 Ibid. at paragraph 91(e) (emphasis added).

120 Ibid. at paragraph 91(f) (emphasis added).

121 Ibid. at paragraph 104 (emphasis added).

122 First oral statement of Mexico at paras. 21(d) and 28.

123 Mexico's responses to questions 89 and 90 from the Panel.

124 First written submission, para 105: "In this connection, Guatemala seeks to imply that these are two
different products, when in fact they are one and the same [...]." (emphasis added)

125 First oral communication, para 33: "[...] since for the purposes of the investigation, it was the same
product." (emphasis added)

126 Mexico's response to question 89 from the Panel: "[ ...] the information available indicates that it is
the same merchandise [...]." (emphasis added)

127 Written transcript of second substantive meeting. Mexico, commenting on Guatemala's claims
concerning the alleged changes in the definition of the i nvestigated product, stated: "We take sharp issue with
Guatemala that changes were made in this regard. ... The product under investigation remains the same, i.e.,
black or galvanized standard pipes and tubes, without going into the details adduced to make a case for two
differentiated products."

Mexico as "standard pi pe" or "conduction pipe" , were principally used to carry liquids and gases, but
also could be used to produce pipe fittings and similar products, and for certain structural purposes
(e.g., fencing). The application indicated that in Guatemala these products are known as " cañería"
(conduction), or "tubería liviana" (light), "tubería mediana" (medium), and " tubería pesada" (heavy)
or " gruesa" (thick)" . The application emphasized that the imported Guatemalan product and the
Mexican "like product" both conformed to the A-53 standard , making the point that the imported and
like products were "identical" . With further reference to physi cal characteristics, the application
stated that although the size range for standard pipe went up to 26" diameter, the product imported
from Guatemala ranged from ½" to 4" , and that the most common schedules [wall thicknesses] were
30, 40 and 80, with schedule 40 predominating . In terms of production process, the application
indicated that the product was produced via elect ric resistance welding from hot-rolled steel coils . As
for tariff classification, the application indicated that the subject products were imported under two
categories128 that included but were not limited to tho se products, as in addition to the investigated
products, structural tubing and conduit also were included. The application asserted that the pipe
from Guatemala was identical to th at produced by the Mexican domestic producers, and that both had
the same "quality, standards, specifications and uses".129
2. The "prevención" (GTM-3)
7.67 In its answers to the pre-initiation questioning by Economía (the "prevención"), Hylsa again
stressed that the product at issue corresponded to the ASTM A-53 standard: "The specifications are
based on ASTM A-53, the most common standard used for this type of pipe and tubing". 130 I n
support, Hylsa provided copies of analyses of investigated products produced by Tubac and by Hylsa,
all of which were identified as corresponding to the ASTM A-53 specification. 131 In a footnote on the
page containing the information for Hylsa's product, it is stated that ASTM A-53 was not the only
applicable standard, as BS-1387 also was relevant , and also was produced by Tubac, although it was
consumed less in Mexico than A-53 pipe. 132 In a footnote to the page containing the information for
Tubac's product, it is stated that "hot-rolled sheets are the common input for these pipes". 133 T h e
description of the production process for the investigated product 134 also indicated that the process
began with the unrolling of a coil of hot-rolled steel sheet ("principal input").
7.68 Question 3 of the "prevención" noted that in the application, Hylsa had indicated that under
the two tariff categories identified, "in addition to th e product subject to the investigation, structural
tubing and conduit tubing" also entered Mexico. Eco nomía asked Hylsa to clarify whether structural
and conduit tubing were or were not covered by the investigation. Hylsa's response was submitted as
confidential.135 Question 4 of the "prevención" asked Hyl sa, in the event the response to question 3

128 As discussed, supra, the two tariff categories were 7306.30.01 and 7306.30.99 (galvanized and
"other" welded carbon steel pipe and tube, respectively).

129 Exhibit GTM-1, Volume 2, p. 5. The annexes to Volume II of the application contain (largely
confidential) injury information submitted by the applicant.

130 Exhibit GTM-3, answer to Question 1.

131 Exhibit GTM-3, Annex 1.

132 Ibid.

133 Ibid.

134 Exhibit GTM-3, Annex 10.

135 Exhibit GTM-3, answer to question 3.

was negative, to estimate the amount of the tota l reported imports represented by the non-subject
products. Hylsa provided a narrative response confirmi ng that structural and conduit tubing also were
classified within the two tariff categories, but part of the narrative was confidential.
136 Hylsa
indicated that it was not able to provide the re quested estimates because it did not know the total
amounts of the imports, but only those of certain importers.137
7.69 In response to question 16 of the "prevenci ón" concerning diameters and wall thicknesses of
the product under investigation, Hylsa provided a table of diameters and wall thicknesses which it
said were those of the standard pipes imported from Guatemala. The source of this information was
not indicated.
7.70 In response to question 23 of the "prevenc ión", which requested information on the
conversion factors used to convert the prices in th e price quote and the invoice, from a per-piece to a
per kilogram basis, Hylsa provided a table id entified as coming from a specification for products
produced by Hylsa, which according to Hylsa also applied to the Guatemalan products, as both were
produced according to strict standards. Hylsa did not otherwise identify the specification in question,
and the schedule of dimensions does not correspond to that in the ASTM A-53 specification. In
Tubac's questionnaire response, a table containing th e same dimensions, identified as corresponding
to those in the BS-1387 specification was provided. In answer to a question from the Panel, Mexico
confirmed that the dimensions referred to in the table provided by Hylsa were those for BS-1387
pipe.
138
3. The notice of initiation (GTM-4)
7.71 The description of the investigated product in the notice of initiation was essentially the same
as that in the application. The notice stated that the product imported from Guatemala was a
"commodity" product, produced from hot-rolled steel coils , known by the generic name of standard
pipe, and by the commercial and/or technical na mes of galvanized and black standard pipe
(mentioning as well the names by which the product was known in Guatemala 139). Concerning the
physical characteristics and chemical composition of standard pipe, the notice stated that the applicant
had indicated that these were as set forth in the ASTM A-53 standard , the "principal standard" for
these products, and that that standard also establis hed that the product was produced to particular
"schedules" denoting wall thickness, resistance a nd durability, among which schedules 30, 40 and 80
were the most common, especially schedule 40 (the most widely demanded). The notice also recited
long excerpts from the ASTM A-53 standard, and indicated that although the technical analyses of the
Guatemalan and Mexican products showed some phy sical differences, all of the reported values fell
within the ranges specified in ASTM A-53. The no tice indicated that, as stat ed in the application,
although standard pipes could range from 3/8" to 26" in diameter, those imported from Guatemala
ranged from ½" to 4" in diameter.
7.72 In terms of the definition of the "like product", the notice of initiation states:

136 As indicated above, in answer to questioning by the Panel Mexico provided the text that had been
omitted as confidential from the public version of Hylsa's reply to this question. See paragraph 7.47, supra.

137 Questions 5-15 requested clarifications of the injury information provided in the application.

138 Response to question 174 of the Panel: "The table indeed conforms to the BS-1387 standard."
Economía also requested and receive d clarifications relating to the in jury information submitted with the
application. See Exhibit GTM-3, questions 14 and 15.

139 Cañería, tubería liviana, mediana, and tubería pesada or gruesa.

"... relying upon the information supplied by the applicant regarding the description,
physical characteristics, chemical composition, uses, production process and inputs of
domestically manufactured standard pipes and tubes and standard pipes and tubes
imported from the Republic of Guatemala, as referred to in points 5 to 29 of this
Resolution, the Ministry made a preliminary determination that the two products were
similar in terms of their physical characte ristics and chemistry and were destined for
the same end uses, which enabled them to fulfil the same functions and made them
commercially interchangeable, and were hence like products."
140
7.73 In terms of the "alleged injury" component of its initiation analysis, Economía relied upon the
domestic industry information supplied by the applicant, while concluding that, in respect of financial
indicators, "the 'Hylsa-DAT' statement of results to which the applicant refers does indeed correspond
to operating results for the like product , and it therefore decided that at the current stage in the
investigation, the assessment would be confined to results concerning the like product and the
applicant as a whole." (emphasis added)141
4. Submission of Tubac accompanying response to exporters' questionnaire / questionnaire
response (GTM-5)
7.74 In conjunction with its reply to the exporters' questionnaire, Tubac made a written submission
questioning various points related to the investig ation, including the definition of the product under
investigation. Tubac argued in this submission th at Economía and the applicant had not adequately
defined the coverage of the investigated product . According to Tubac, the description of the pipes in
question was confusing, and did not permit Tubac to know the scope or coverage of the product under
investigation. Tubac stated that in the technical and commercial literature there was no reference to
any product called "standard pipe", even in the AS TM A-53 standard cited by the applicant. Tubac
stated that Hylsa's own website referred to thr ee types of "heavy walled pipe": conduction, conduit,
and mechanical tubing. Tubac indicated that it was unclear whether all of these three types were
covered by the application, and that even the IA had recognized the lack of clarity, asking Hylsa in the
"prevención" whether structural and conduit tubing were included. Tubac noted, and objected to the
fact, that Hylsa had qualified its reply to that question as confidential, but also noted a statement in the
application that the published import statistics covere d, "in addition to black and galvanized standard
pipes, products known as galvanized structural tubing and conduit tubing". Tubac went on to
conclude that, without prejudice to its position, in its questionnaire response, it reasonably assumed
that the investigated product was only galvanized and black conduction pipe, as defined by Hylsa on
its website . The excerpt from Hylsa's website, Annex 2 to the submission, listed a variety of
diameters ranging from ½" to 6", in schedules 40 and 80 (and a few also with thinner-walled
dimensions whose schedule was identified as "X"). Th e "typical applications" were identified as pipe
for conduction of water, air, gas and special fluids.
7.75 In its response to the exporters' questionnaire, Tubac listed in response to question 2.13, on
product codes, various sizes of pipe referred to either as " mediana" or "liviana", or as schedule 40 or
80. Most of the listed codes were schedule 40. In its answer 2.17 (installed capacity) Tubac stated
that the data it provided were limited to informa tion on conduction pipe. In its answer to question
2.18, Tubac stated that the data it submitted on th e other economic indicators also were only those
relating to conduction pipe, both the ASTM and the BS norms. Tubac furnished, in Annex 10 to its
response, a document indicating the technical di fferences between ASTM A-53 and BS-1387. It

140 Exhibit GTM-4, para. 69.

141 Exhibit GTM-4, para. 134. See also our factual summary of injury data, infra, paras. 7.292 ff. We
recall that we have already addressed above Economía's treatment of the volume of dumped imports at the
initiation stage.

further stated that the IA should be aware that T ubac produced other products than these in the same
plants.
5. Hylsa's reply to Tubac's submission and exporters' questionnaire response (GTM-27)
7.76 In its reply to Tubac's submission (Exhibit GTM-5), Hylsa challenged Tubac's assertion that
the term "standard pipe" did not exist, quoting from various references that used that term. (We note
that none of the annexed documents contained a definition of the term, however.) Hylsa also
challenged Tubac's statement that the product definition was not clear. Hylsa stated that it was the
case "as the exporter concludes, that the investigated product is defined as all welded standard pipe,
galvanized or black, for conduction , it needing to be stated that this definition ... naturally applies to
welded standard pipe, galvanized or black, of th e dimensions specified in Annex 2, which have
identical physical characteristics, chemistry and finish, and similar resistance, and it being clarified
that so-called conduit tubing is not part of the investigated product" because it was not sufficiently
similar for purposes of the relevant provisions of Mexican law. In Annex 2, Hylsa stated that
structural tubing ("not included in the investig ation) coming from Guatemala corresponded to the
"ASTM A-513" standard, and was produced from cold-rolled steel, and that structural tubing could be
distinguished from conduction pipe on the basis of its wall thickness, as structural was lighter-walled.
Hylsa further stated that ASTM A-53 did not exclusively cover conduction pipe, and that what was
not covered by Hylsa’s application was tubing with thin walls and thus structural tubing, with wall
thickness less than 14 gauge, i.e. between 15 and 22 gauge. Hylsa attached a table which it indicated
referred to structural tubing from Guatemala not covered by the investigation. Hylsa presented a
second table in Annex 2 of "Dimensions of the denounced tubing", ranging from 1/2" to 6" in
diameter in a range of wall thicknesses denominated in inches and millimetres. In Annex 2, Hylsa
described the difference between the gauge (or sheet thickness) and the pipe schedule, the latter being
a relationship between the thickness and the diameter of the pipe, or between the resistance to the
material being conducted and the resi stance to force of the steel. Hy lsa concluded with the statement
that the most common pipe schedules were 20, 30, 40 and 80, and that pipe schedules generally are
mentioned in referring to standard pipe.
6. Information from the domestic industry prior to the Preliminary Determination
7.77 In response to Economía's request of 10 December 2001
142, Hylsa submitted143 a conciliation
of financial data for its Tubular Products Division, Hylsa-DAT, for costs, sales and profits for the
"like product" to the data for Hylsa S.A. that had been submitted previously in response to Economía's
initial (pre-initiation) "prevenci ón". Economía requested information, on 17 December 2001, from
Tuberías Procarsa ("Procarsa"), Tubería Nacional ("TN") and Compañía Mexicana de Perfiles y
Tubos ("CMPT") and the National Chamber of th e Iron and Steel Industry ("CANACERO"). In
addition to requesting economic injury data for the years 1998, 1999 and 2000
144, and information on
the methodology used to calculate installed capacity for production of standard black and galvanized
tubing, these requests sought import information (includi ng invoice and "pedimentos"). At that point,
the imported product from Guatemala was identified by Economía as " tubería estándar negra y
galvanizada" (standard pipes and tubes, black and galvan ized) classified by tariff line. Tubería
Nacional, Compañía Mexicana de Perfiles y Tubos and CANACERO submitted responses.145

142 Exhibit GTM-8.

143 Exhibit GTM-9.

144 See also our factual summary of aspects of injury data taken into account, infra, para. 7.301.

145 Exhibit GTM-10, para. 106.

7. Preliminary Determination (GTM-10)
7.78 The Preliminary Determination stated at para graph 5 that "the product" consisted of
"commodity" products, produced from hot-rolled coils , in diameters ranging from ½" to 6" . At
paragraph 6 the determination stated that the pr oduct was known in Mexico as "standard pipe" or
"conduction pipe ", and was known in Guatemala by the names of " cañería", " tubería ligera o
liviana", " tubería mediana " and " tubería pesada o gruesa ". At paragraph 7, the determination
indicated that Tubac had argued that the description of the investigated product was too imprecise for
Tubac to know the scope of the investigation, as in the literature and on Hylsa’s own web page there
was no reference to "standard pipe". At paragra ph 8, the determination indicated that Economía had
rejected this argument because of the references in the various publications submitted by Hylsa to
"standard pipe", and because Tubac had indicat ed that "conduction pipe" was among the tubing
produced by Hylsa, and this was one of the names by which the investigated product was known in
Mexico.
7.79 Concerning the physical characteristics of the subject product, the determination stated at
paragraph 13 that Hylsa had indicated that the ph ysical characteristics and chemistry of "standard
pipe" were those contained in ASTM A-53 (the most common) specification, and at paragraph 14 that
the product also could be produced under the BS-1387, DIN 2440, DIN 2441 and JIS G 3454
specifications. At paragraph 15, the determination indicated that Hylsa had stated that "conduction
pipe" (imported from Guatemala and produced in Mexico) was available in diameters between ½" and
6" inches, and with wall thicknesses between 1.60 and 7.11 mm, "in different schedules, among which
30, 40, and 80, especially 40, were the most common."
7.80 At paragraph 17, the Determination indicated that Economía had observed that the imported
product and the Mexican product were both pr oduced under ASTM A-53 and also, for the
Guatemalan product, BS-1387, that the chemical composition fell within the ranges specified in A-53,
and that both products were available in the diameter range of ½" to 6", especially in schedules 40 and
80.
7.81 At paragraph 19, the Determination indicated th at standard pipe was produced in two major
steps, the first starting with the welding, from hot -rolled steel, of the tubular shape, and cutting to
length, and the second consisting of the finishing (p ainting, galvanizing). (At paragraph 18, the
Determination recounted Hylsa’s statements th at the Guatemalan and Mexican products were
produced via similar processes: electric resistance welding, using as the principal inputs hot-rolled
steel coils, electricity, natural gas, zinc, water, etc.) As for functions and uses of the product,
paragraph 20 of the Determination stated that the product had a broad range of uses, principally
conduction of water, air, non-corrosive liquids, cabl es, etc., with galvanized used where protection
from the environment was important. In addition, th e Determination stated that the product could be
used for production of pipe fittings and other products, and for structural purposes. At paragraph 117,
the Determination indicated that Hylsa's application stated that structural and conduit tubing "... are
non-subject products".
7.82 The Preliminary Determination contains Economía's definition – at that point in the
investigation – of the "like product" produced by the domestic industry. In particular, Economía
determined that the investigated product – black or galvanized standard pipe, as described in
paragraphs 5-23 of the Determin ation – "ranging from 1/2" to 6" in diameter ... is like the
domestically manufactured product ... inter alia because the two possess the same physical and
chemical characteristics, enabling them to fulfil the same functions and making them commercially
interchangeable".
146 The Preliminary Determination indicates that "the information coming from

146 Exhibit GTM-10, para. 84.

CMPT differed from the figures supplied by CANACERO; a possible explanation is that non-subject
products were included, so the matter will be further investigated in the next stage of the procedure";
describes Economía's injury analysis of the domestic industry producing the "like product"
147 and its
analysis of the impact of the dumped imports on this domestic industry.148
8. Technical information meeting with Tubac (GTM-11(A))
7.83 Following the Preliminary Determination, Ec onomía held a technical meeting with
representatives of Tubac to explain the calculation me thodology used in that Determination. At the
meeting, one of Tubac's representatives stated that the description of the inv estigated product in the
Determination was not correct, and also was conf used, which meant that the provisional measures
were being applied to all of the products that we re entering Mexico under the two tariff categories.
She requested that the investigated product be clar ified – as a definition of "standard pipe" did not
exist – so that in the Final Determination the pr oducts not subject to the duties would be clearly
specified.
7.84 The Economía official responded that the pr oduct imported from Guatemala and the domestic
like product were commodity products, in diameters between ½" and 6", and that the generic name for
them was standard pipe, also known as standard galvanized or standa rd black pipe. In Mexico these
products were identified as "standard pipe" or "conduction pipe", a nd this was the product on which
the analysis in the investigation was conducted, and which was subject to the provisional measures.
9. Technical information meeting with Hylsa (GTM-11(B))
7.85 Economía also held a technical information meeting with representatives of Hylsa following
the Preliminary Determination. Among the issues ra ised by Hylsa's representa tives in respect of the
data that Tubac had submitted were the criteria th at had been used to determine whether a given
product of Tubac was similar or identical to th e investigated product, and whether the 32 product
codes of Tubac that had been taken into account for the Preliminary Determination were the only
product codes of that company pertaining to stan dard pipe. The representatives argued that if
commercial considerations were taken into accoun t, a larger number of product codes would be
covered by the investigation. In response to these points, Economía explained that Tubac had
provided a table containing a description of all of the physical characteristics, and the official
standards, for each of its product codes. Economía st ated that it had analysed all of these codes, and
that only 32 of them fell within the definition of standard pipe.149

147 See GTM-10, paras. 150-164 (analysis of economic injury factors); paras. 165-182 (financial injury
factors). See also our factual summary of aspects of Economía's analysis, infra, paras. 7.304 and 7.305.

148 For example, in terms of data on imports from Guatemala, the Preliminary Determination further
reveals that Economía received 312 import "pedimentos" and invoices, of which Economía estimated 74 per
cent related to the subject product. In respect of imports from sources other than Guatemala, the applicant had
estimated the proportion of imports in the respective tariff lines accounted for by the su bject product (up to 6"),
but Economía made its own estimate. In addition, Economía had 313 "pedimentos" and invoices from
59 customs agents relating to standard black and galvanized tubing "en las dimensiones señaladas" (i.e.
implying this meant the product between ½ and 6 inches). Exhibit GTM-10, paras. 120-126.

149 In its 29 April 2002 comments on the Preliminary Determination, Hylsa submitted supplementary
information in respect of the financial injury data of Hylsa/Hylsa-DAT and asserted that the analysis of the
product under investigation/like product had to be base d on the essential characteristics of the product, given
that product codes were arbitrary and not useful for a comparison of normal value and export price (p. 7).

10. Notice of verification to Tubac (GTM-13)
7.86 Prior to the verification visit, Economía sent to Tubac a written notice that it planned such a
visit. From this notice it is clear that the verifi cation was to focus extensively on which of Tubac's
products and sales were and were not covered by the scope of the investigation. The notice specified
the points that Economía wanted to verify, identifying the product to be verified (standard pipe), and
the period of investigation. 150 The notice indicated that the co mpany would be allowed to present
during the visit any information that would clar ify and support any arguments that it wished to
advance.151 The notice also indicated that the company would be asked to explain the criteria it had
used to determine which were identical and simila r product codes, and to demonstrate that the only
differences between the non-identical products refe rred to in Tubac's questionnaire response were
threading and coupling. 152 It further indicated that Tubac w ould be asked for a worksheet with the
details of the characteristics and criteria that ha d been used to exclude product codes from the
submitted database, as well as the documenta ry and accounting evidence supporting these
exclusions.153
7.87 The notice indicated that Tubac's questionnaire response would be submitted to a "Prueba de
totalidad" ("completeness test") in which the figur es for the reported transactions would be compared
to the company's accounting records. 154 In addition, the company would be asked to explain how it
had ensured that no transactions had been erroneous ly omitted from or included in the sales listings in
the questionnaire response. 155 Economía also indicated that Tubac would be asked to reconcile to its
accounting records its Diagram 1 (provided with th e questionnaire response ), which reported total
sales of the company and subdivided those between i nvestigated and non investigated products and
then subdivided the former among third markets, domestic market and exports to Mexico. 156 As part
of this, Tubac would be asked to show th e process the company had followed to identify: 157 the total
sales of the company; the transactions to the dome stic and third market of products identical and
similar to those exported to Mexico; the export tr ansactions to Mexico corresponding to the product
codes for standard tubing; the sales to Mexico corresponding to other, non-investigated, product
codes; and the total sales of products other than sta ndard tubing. The notice also requested Tubac to
prepare a report showing the domestic sales, and the exports to Mexico and to other markets of the
identical or similar product codes. This inform ation was to be presented on a monthly basis and
detailed by product code, as well as by country in the case of third markets.158

150 GTM-13, para. 6.

151 GTM-13, para. 7.

152 GTM-13, para. 10.

153 GTM-13, para. 11.

154 GTM-13, para. 17.

155 Exhibit GTM-13, para. 18.

156 Exhibit GTM-13, para. 19.

157 Exhibit GTM-13, para. 20.

158 Exhibit GTM-13, para. 23.

11. Verification report – Tubac (GTM-15)
7.88 The report on the on-site verification of Tub ac contains a number of passages pertaining to
the product scope of the investigation, and the produc ts of Tubac that fell within that scope. Under
the heading "Validation of the sample of sales invoices", subheading "Product codes", the report
indicates that the company explained its 9-digit product codes.
159 The report indicates that Tubac
presented a listing of all of its product codes, in cluding investigated and non investigated products,
and that Tubac explained that its products covere d by the investigation corresponded to the ASTM A-
53 and BS-1387 technical standards, which containe d the technical specifications of the production
process, including chemical composition, tolerances (for weight, dimensions, etc.), testing and other
aspects.
7.89 Concerning the "Prueba de totalidad", the repor t states that Economía was satisfied with the
conciliation of the figures corresponding to Diagram 1 and that the company had provided a report of
domestic sales of identical or similar products to those exported to Mexico, and of sales of all other
investigated products. The report indicates that on the basis of these reports, Economía made further
selective tests to corroborate the information repor ted in the database sent to Economía by product
code and by country, and that no differences were found.160
7.90 Concerning Tubac's sales to the domestic market , exports to Mexico and to other countries,
the report indicates that the company provided th e sales report containing the sales of all product
codes for each month of 1999 and from January–June of 2000. The report indicates that from this
report, the verification team selec ted the codes under investigation and compared the total volume
with the information in the questionnaire response.
7.91 As an additional test and with the purpose of ve rifying that no relevant invoices (for covered
products) had been omitted from the database, Econom ía selected 19 invoices from the report of total
sales to corroborate that invoices that did not appear in the data base did not involve sales of any
investigated product codes, and that invoices involvi ng sales of any such products were duly included
in the data base.
12. Verification report – Hylsa (GTM-24)
7.92 The report on the on-site verification of Hylsa refers to "imports of standard pipe, classified in
tariff lines 7306.30.01 and 7306.30.99 [...] orig inating in the Republic of Guatemala …". 161 I t
indicates that certain information to be verified "concerned the production capacity and use of the
installed capacity for black and galvanized standa rd conduction pipe, referred to in point 27 of the
verification document itself ."
162 It further indicates that Hylsa explained that its information system
did not identify products at the level of the "inv estigated product", and that the reported product codes
had been manually identified. At the request of Economía, the company had conducted an exercise
identifying the product codes selected for reporting to Economía. As a result of this exercise,
Economía observed that the information that had been presented by Hylsa included conduction tubing
as well as a certain "type of structural or mechanical tubing, since, according to the company, they are
products with the same physical characteristics, composition, dimensions and uses, as was verified."

159 Exhibits GTM-15/MEX-12 at pages 4-5.

160 Ibid. at pages 12-13.

161 Exhibit GTM-24, p. 1.

162 Exhibit GTM-24, p. 3.

13. Other information from the domestic i ndustry between the Preliminary and Final
Determinations
7.93 In August 2002, Economía sent a request for furt her injury information to Tuberías Procarsa,
Tubería Nacional and Compañía Mexicana de Perfiles y Tubos. 163 This request asked for clarification
as to whether responses to the previous request included only information pertaining to "seamed
tubing, largely 'ERW: electric resisstant [sic] weld ed', of a diameter ranging from ½ to 6 inches and
with a wall thickness of 0.065 to 0.280 inches, in schedules 30, 40 and 80." This product description
explicitly includes tubing from 4"-6", and does not appear to exclude structural tubing. The request
asked for the information to be provided in a ta ble, which contained the same product definition
(including up to 6"). The domestic firms were also asked to indicate how the methodology used to
calculate installed capacity for production of standa rd black and galvanized tubing that they had
already provided to Economía rela ted to this product, and also were asked for information on the
gauges and schedules corresponding to these specificati ons, with a table clearly including entries for
tubing up to 6". Certain of the firms were also asked for updated information on imports of the
product as identified in that request (i.e. including 4"-6" tubing and not excluding structural
tubing).
164,165
14. Public hearing (GTM-19)
7.94 At the public hearing the representative of Tub ac argued that Tubac had insisted during the
investigation that the applicant's definition of th e investigated product was confused and prevented
Tubac from knowing the scope and coverage of the product. Nevertheless, Tubac had concluded that
the covered product was "iron or steel conduction pipe in ½" to 6" diameters, black or galvanized,
produced to the standards ASTM and BS" 166, and that products excluded from the investigation were
black and galvanized mechanical tubing, industrial tubing, structural tubing, fence tubing, and conduit
tubing.167 The Tubac representative stated later in th e hearing that at verification Economía had
confirmed the existence and consiste ncy of the product codes reported by Tubac, and that Tubac thus
would abide by the analysis and judgement of the investigating authority at verification. 168 T h e
representative of Hylsa, disputing Tubac's characteri zation of the issue, maintained that the product
definition had always been clear, and that "Tubac itself has correctly char acterized the product as
conduction tube, recognizably for conduction". 169 The representative went on to say that independent
of the standards or incidental characteristics, th e investigated product was "standard pipe of carbon
steel, ½" to 6" in diameter, whether black or galv anized, with longitudinal weld, and recognizable for
conduction, with the possibility that it might improperly be used for structural purposes".170

163 Exhibit GTM-18.

164 The request to TN does not include such a question on imports. The Final Determination,
Exhibit GTM-23, paras. 139-142, reflects these companies' responses to these requests for information.

165 CMPT indicated that it did not produce the product as defined. Final Determination, Exhibit GTM-
23, para. 142.

166 Exhibit GTM-19, p. 7.

167 Exhibit GTM-19, p. 8.

168 Exhibit GTM-19, p. 27.

169 Exhibit GTM-19, p. 30.

170 Exhibit GTM-19, pp. 30-31.

7.95 In response to questioning from Tubac's repr esentative as to whether "industrial tubing"
produced from cold-rolled sheet and used for metal furniture was included, Hylsa's representative then
stated that all tubing in gauges thicker than 16 fo r mainly conduction purposes in the stated diameters
were included. The representative al so stated that although Hylsa did not tie the product definition to
specific standards, nevertheless the most comm on were BS-1387 and A-53, and the thicknesses under
these standards went from 14 gauge to thicker and this was the reason for the product coverage.
171
7.96 The Hylsa representative also said that there we re countless cases where pipe and tube with
the same physical and chemical ch aracteristics as conduction pipe but with no hydrostatic test were
used as conduction pipe in non-critical uses, that some other clients conducted hydrostatic tests after
purchase172, and that products produced from both hot-rolled and cold-rolled steel were covered by the
investigation, so long as they were 14 gauge or thicker. 173 Economía asked whether tubing produced
from cold-rolled steel could be used for conduction, given its tendency to oxidize, and the Hylsa
representative answered affirmatively, stating that it could be coated, such as with varnish, or
galvanized.174
7.97 Economía asked Tubac whether it could guarant ee that none of its products sold without
hydrostatic testing were used fo r conduction purposes. The Tubac representative replied that the
diameters of the industrial tubing mentioned by Hy lsa were different from those of A-53 or BS-1387
pipe meaning that it would not be possible to thread them or attach a coupling. While it was possible
that someone might use conduction pipe for mechanical purposes, this would not make sense, because
of the higher price for conduction pipe due to the hydrostatic test, while doing the reverse would not
be possible.175 Economía stated that it would formulate an information requirement to the parties on
this issue.
15. Arguments – 6 September 2002
(a) Hylsa (GTM-20)
7.98 Hylsa argued in its written brief following the pu blic hearing that the product definition was
clear and that Tubac had "correctly considered" that product by characterizing it as tubing
recognizable for conduction. Hylsa stated that the definition was standard tubing produced from
carbon steel, in diameters from ½ to 6", black or galvanized, and recognizable for conduction,
although it was possible that it could be "improperly" used for structural purposes. Hylsa stated that
in the Mexican market, certain structural tubing of schedule 40 meeting the "ASTM A500" standard

171 Exhibit GTM-19, p. 36.

172 Exhibit GTM-19, p. 38.

173 Exhibit GTM-19, p. 40.

174 Exhibit GTM-19, p. 92. In Hylsa's written responses to questions following the public hearing,
Exhibit GTM-28(B), 3 September 2002, Hylsa submitted estimates of percentages of the investigated product
destined for the conduction and structural markets, and indicated its view that imports of standard tubing from
sources other than Guatemala "had no repercussions on the operational perf ormance either of Hylsa's Division
of Steel Tubing or of the rest of the domestic industry, as far as the investigated product is concerned ...".

175 Exhibit GTM-19, p, 98.

was being used for conduction, and that this situa tion needed to be taken into account in any measure
applied, to prevent the measure from being eluded.176
(b) Tubac (GTM-29)
7.99 In its written brief, Tubac argued that there was an absolute lack of a definition of the
investigated product. Tubac argued that the appli cant was confused regarding the product, sometimes
saying that it included structural tubing and someti mes saying that it did not. Tubac stated that it
concluded from Hylsa's statements that the merc handise that entered under the two tariff categories
that was not covered and needed to be expressly excluded was, among others, conduit tubing and thin-
walled tubing produced from hot-rolled steel in gauges 16 and thinner. Tubac disagreed with Hylsa
on the inclusion of any product produced from cold-rolled steel, arguing that such products could not
be used for conduction. Tubac also disagreed that the fact that a given tube did not meet the ASTM or
BS specification was irrelevant to whether it could be used for conduction purposes. Tubac said that
all of its conduction pipe met those standards, and that if its customers were using other kinds of
tubing for that purpose it was on their own responsibility. Tubac also stated, in the context of another
argument, that in the absence of a precise definition by the applicant, the cr iterion used by Tubac to
define the investigated product was: "pipe for conduction, welded, produced from hot-rolled carbon
steel, in 1/2 " to 4" diameters, black or galvan ized, produced under the standards ASTM A-53 and
BS-1387".
16. Final Determination
7.100 The Final Determination, at paragraphs 31 a nd 32, contains the conclusions of Economía
concerning the scope of the investigated product. These conclusions follow a lengthy recitation of the
arguments of the parties on this i ssue that were presented over the course of the investigation. These
paragraphs indicate the following: Paragraph 31 states that after analyz ing these arguments and
evidence Economía had sufficient elements to cons ider that the principal use of the product was
conduction, which was fundamentally linked to certa in ranges of diameters and wall thicknesses, and
that the raw material – hot-rolled or cold-rolled steel sheet – or the standard under which it was
produced, were not necessarily determinative for that use. Paragraph 32, chapeau, states that:
 "... the Ministry found sufficient eviden ce to determine that, regardless of the
standard or of the input used in manufacturi ng it, the physical characteristics and
technical specifications of the investigated tubing are the following: tubing
manufactured with carbon steel, with longitudinal weld, whether galvanized or black,
of a diameter ranging from ½" to 6" (equivalent to 12.70 and 152.40 mm,

176 Exhibit GTM-20, p. 9. In its 17 September 2002 responses to Economía's questions, Exhibit GTM-
31, Hylsa offered additional views of the "product under investigation"/"like product" and, in particular whether
or not it included structural tubing. In response to a question relating to how its product corresponded to the
given description of the product, Hylsa confirmed that "the investigated tubing fits in 100 per cent with the types
of tubing referred to in the [document] cited..." and gave estimates about the percentage of the investigated
product that was sold with hydrostatic tests as ASTM -A53 and as BS-1387. Hy lsa also indicated: "The
remainder ... corresponds to structural tubing under investigation used for the purpose of conduction because it
is commercially interchangeable and has the same phy sical and chemical characteristics as conduction tubing
…" Hylsa also responded that its production lines needed no modifications to ensure that the product satisfied
these norms. Much of the document in question is "confidential" (see our findings on the issue of the treatment
of confidential information by Economía below); neverthe less, the public information in the responses and the
titles of these annexes indicate that they include documents and testimonials and invoices from
producers/distributors concerning the commercial practice of acquiring structural tubing without "hydrostatic
testing" and using it for conduction; information from importers of certain types of structural tubing; estimates
of the breakdown of national production of the product under investigation; and testimonials on the
substitutability and representativeness of certain products.

respectively), with wall thicknesses of over 0.075" and up to 0.280" (equivalent to
1.91 and 7.11mm, respectively), of gauges equa l to or greater than 14 and of various
schedules - most commonly but not solely 30, 40 and 80." (emphasis added)
7.101 The remainder of paragraph 32 provides a list of the particular considerations that led
Economía to this definition.
7.102 Concerning the Mexican "like product", the Final Determination, indicates that the
investigated product as defined "is like the dom estically manufactured product ... because among
other things it has the same physical character istics and diameter and wall thickness specifications,
enabling it to fulfil the same functions and making it commercially interchangeable".
177 We examine
below the contents of the Final Determination in respect of the injury an alysis of the domestic
industry producing the "like product" 178; and of the impact of the dumped imports on this domestic
industry producing the "like product".179
17. Factual finding by the Panel
7.103 On the basis of the relevant record evidence, as recited above, we are persuaded that, as
Guatemala argues, Economía twice expanded the scope of the investigated product. The first
modification, the addition of 4"-6" diameter pipe, was made in the Preliminary Determination. We
find this change to be self-evident from a comparison of the product descriptions in the Notice of
Initiation and the Preliminary Determination. The fo rmer states that the size range of the product
imported from Guatemala was ½" to 4", while the latter states that product ranged in size from ½" to
6".
7.104 Regarding the second modification, we find th at Economía added the structural tubing in
question to the product scope late in the investiga tion (i.e., after the public hearing, which followed
verification), rather than having included it in the scope from the outset. In this regard, we attach
particular importance to the following evidence reci ted above: (1) the heavy emphasis placed, in the
application, the "prevención", and the notice of in itiation, on the technical standards, especially
ASTM A-53, as describing the "standard pipe" under i nvestigation; (2) the fact that Economía did not
react, at the time Tubac submitted its questionnaire response and the accompanying submission, to
Tubac's very explicit statements that it was repor ting data only on its sales of A-53 and BS-1387 pipe,
its understanding of the scope of the investigated product; (3) the fact that Hylsa did not object, in its
reply to the brief accompanying Tubac's questionnaire response, to the scope of products covered by
Tubac's questionnaire response; (4) the fact that the Preliminary Determination states that the
application indicated that structural was not subjec t to the investigation; (5) Economía's statement,
during its technical meeting with Hylsa following the preliminary determination, that Tubac had
provided a table containing all of the physical charac teristics and official standards applicable to its
product codes, that Economía had analysed all of these product codes, and that only 32 of them fell
within the definition of "standard pipe"; (6) the i ndications in the verification notice that the question
of product codes was to be scrutinized in detail at verification and the statements in the verification
report indicating that all of Tubac's product codes were analysed, and that at various points during the
verification visit, the verification team itsel f identified the product codes corresponding to the
investigated product; and (7) the debate during the pub lic hearing (which was held after verification)
as to whether structural tubing should or should not be considered part of the investigated product,

177 GTM-23, para. 117.

178 See also our factual summary of the data gather ed and taken into account for the purposes of the
analysis of injury to the domestic industry, infra, paras. 7.301-7.312.

179 Exhibit GTM-23, paras. 165-169. See infra para. 7.264 ff.

and the questions posed by Economía after the public hearing on this subject, which indicated that this
was a new issue to Economía as of that point in the investigation.
7.105 We emphasize that the above discussion constitu tes a factual finding that the product scope
changes alleged by Guatemala took place, and is no t intended to resolve any of Guatemala's claims
pertaining to these changes, nor is it meant to imply that changing the product scope of an
investigation, as such, is problematic under the Anti-Dumping Agreement. We note in this regard that
the parties are in agreement that the Agreement does not prohibit, as such, changes to the product
scope of an investigation. We take up Guatemal a's claims pertaining to the changes to the product
scope in the following sections. We recall that thes e include claims related to both the injury and
dumping findings, and as a result to the scope of th e measure eventually applied by Mexico. The
essence of all of these claims is that although Economía changed the scope of the investigated product
twice during the course of the investigation, it did no t gather or analyse information pertaining to the
added products. In this regard, a lthough Guatemala alleges a violation of Article 2.6 in respect of the
injury analysis, it has confirmed to us that it ma kes no allegation of any "dissimilarity" between the
scope of the product under investigation, on the one hand, and of the like product, on the other.
7.106 We start our analysis of Guatemala's claims rela ted to the changes to the product scope of the
investigation in the section below, with the dumping related claims.
D. CLAIMS RELATING TO DETERMINATION OF DUMPING – RESORT BY ECONOMÍA TO FACTS
AVAILABLE
1. Claims pursuant to Article 6
7.107 We begin our analysis of Guatemala’s claims concerning Economía’s Final Determination of
dumping by considering the claim that Economía’s resort to facts available violated Articles 6.2, 6.4,
6.7, 6.8, 6.9, 6.13, and Annex II.
(a) Arguments of parties
(i) Guatemala

7.108 Guatemala claims that Economía's recourse to "facts available" to calculate the margin of
dumping was unjustified, and violated Articles 6.2, 6.4, 6.7, 6.8, 6.9, 6.13, and Annex II of the Anti-
Dumping Agreement. According to Guatemala, recourse to facts available is permitted only in
exceptional circumstances, i.e., wh ere the interested party in question does not cooperate, or presents
insufficient information; and even there, the investigating authority's discretion to resort to facts
available is not unlimited, as usable verified inform ation should be used. Guatemala argues that the
record indicates that the exporter provided to the Ec onomía all of the information that was requested
of it, and cooperated throughout the inv estigation, but that nevertheless all
 of the exporter's
information was rejected by Economía, in particular the information pertaining to the determination of
dumping. According to Guatemala, this was not only substantively unjustifie d, but Economía also
failed to inform the exporter that it was rejecting th e information, and failed to give the exporter an
opportunity to provide further explana tions, as required by Annex II of the Anti-Dumping Agreement.
Guatemala further argues that in rejecting Tubac' s information and resorting to facts available,
Economía also violated Articles 6.7, 6.9, and 6.13.
(ii) Mexico

7.109 Mexico argues that Guatemala's claim is based on the propositions that: (1) there were no
problems at verification, and (2) that Mexico did not advise Tubac that it was going to base the final
dumping determination on facts available. Mexico argues that neither assertion is correct.

Concerning verification, Mexico points to language of Article 6.8 that allows resort to facts available
where the interested party fails to provide neces sary information, or significantly impedes an
investigation, and asserts that, in this case, the Final Determination recounts problems encountered at
verification, including the "deliberate" incompletene ss of information provided by Tubac. According
to Mexico, the problems with the information provided by Tubac meant that Tubac both "did not
provide necessary information" and "significantly impe ded the investigation" in the sense of Article
6.8, thereby justifying Economía’s determination that the information was not usable. In its first
submission and first oral statement, Mexico argue d that the determinati ons published by Economía
amply fulfilled the notice requirements of the Anti-Dumping Agreement in respect of explanations of
methodology and conclusions reached. In its second submission, second oral statement and answers
to questions from the Panel, Mexico argued that th e verification report itself fulfilled the requirements
of paragraph 6 of Annex II, by informing Tubac that its information might be rejected and by
providing a five-day period for Tubac to submit any comments on the contents of the report.
180
(b) Arguments of the third parties
7.110 None of the submitting third parties addressed this claim as such in its written submission.
The European Communities , however, agrees with Guatemala in the context of its general
procedural claims, that the IA did not inform the in terested parties of two "essential facts", one being
the rejection of Tubac's price data as a result of the verification visit, and the second being the
inclusion of certain structural tubing in the prod uct definition. In the view of the European
Communities, this failure violates Article 6.9 of the Anti-Dumping Agreement. Japan also considers
that the facts determining the product under consid eration are "essential" and subject to disclosure
pursuant to Article 6.9. The United States argues that if there is to be a change to the product
definition, the parties must be informed of the proposals relating thereto and given time to defend
their interests.
(c) Evaluation by the Panel
7.111 This claim of Guatemala raises both substantive and procedural points concerning the use of
facts available. While Guatemala claims violations of a number of provisions in relation to
Economía's use of facts available, the central substa ntive issue, which is the subject of Guatemala's
claim of violation of Article 6.8 and Annex II, is Ec onomía's decision to reject all of the information
submitted by Tubac on the basis of the results of th e verification visit, and to use instead, as facts
available for calculating the margins of dumping, information provided in the application and
information obtained from importers. We thus begin our analysis with this issue. In doing so, we will
consider whether the evidence of record supports Economía’s decision to reject Tubac’s data, i.e.,
whether, on the basis of the record evidence, an unbiased and objective investigating authority could
have reached the conclusion that the nature and num ber of problems encountered at verification were
so significant that none of Tubac’s data in fact c ould be used. We then will consider whether, as
Guatemala alleges, Economía failed to fulfil the re levant procedural requirements of Annex II, and
whether Economía, by using for the normal valu e the data provided by Hylsa for purposes of
initiation, failed to use "special circumspection". In performing this analysis, we will apply the
provisions of the Anti-Dumping Agreement that govern the use by investigating authorities of facts
available, i.e., Article 6.8 and Annex II.
(i) Article 6.8 and Annex II

7.112 We turn first to the text of these provisions. Article 6.8 provides:

180 Mexico's second written submission, para. 123 and 125; Mexico's second oral communication,
paras. 25, 26 and 31; Mexico's responses to questions 111 (a) and (b), and 182 from the Panel.

 "6.8 In cases in which any interested pa rty refuses access to, or otherwise does not
provide, necessary information within a reasonable period or significantly impedes the
investigation, preliminary and fi nal determinations, affirmative or negative, may be made on
the basis of the facts available. The provisions of Annex II shall be observed in the
application of this paragraph."

7.113 Annex II provides:
 BEST INFORMATION AVAILABLE IN TERMS OF PARAGRAPH 8 OF ARTICLE 6

 "1. As soon as possible after the initiation of the investigation, the investigating
authorities should specify in detail the information required from any interested party, and the
manner in which that information should be structur ed by the interested party in its response.
The authorities should also ensure that the party is aware that if information is not supplied
within a reasonable time, the authorities will be free to make determinations on the basis of
the facts available, including those contained in the application for the initiation of the
investigation by the domestic industry.

 2. The authorities may also request that an interested party provide its response in a
particular medium (e.g. computer tape) or computer language. Where such a request is made,
the authorities should consider the reasonable ability of the interested party to respond in the
preferred medium or computer language, and s hould not request the party to use for its
response a computer system other than that u sed by the party. Th e authority should not
maintain a request for a computerized respon se if the interested party does not maintain
computerized accounts and if presenting the r esponse as requested would result in an
unreasonable extra burden on the interested part y, e.g. it would entail unreasonable additional
cost and trouble. The authorities should not main tain a request for a response in a particular
medium or computer language if the interest ed party does not maintain its computerized
accounts in such medium or computer language and if presenting the response as requested
would result in an unreasonable extra burden on th e interested party, e.g. it would entail
unreasonable additional cost and trouble.

 3. All information which is verifiable, which is appropriately submitted so that it can be
used in the investigation without undue difficulties, which is supplied in a timely fashion, and,
where applicable, which is supplied in a medi um or computer language requested by the
authorities, should be taken into account when determinations are made. If a party does not
respond in the preferred medium or computer language but the authorities find that the
circumstances set out in paragraph 2 have b een satisfied, the failure to respond in the
preferred medium or computer language should not be considered to significantly impede the
investigation.

 4. Where the authorities do not have the ab ility to process information if provided in a
particular medium (e.g. computer tape), the information should be supplied in the form of
written material or any other form acceptable to the authorities.

 5. Even though the information provided may not be ideal in all respects, this should not
justify the authorities from disregarding it, provide d the interested party has acted to the best
of its ability.

 6. If evidence or information is not accepte d, 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 are consid ered by the authorities as not being satisfactory,

the reasons for the rejection of such evidence or information should be given in any published
determinations.

 7. If the authorities have to base their fi ndings, including those with respect to normal
value, on information from a secondary sour ce, including the information supplied in the
application for the initiation of the investig ation, they should do so with special
circumspection. In such cases, the authorities should, where practicable, check the
information from other independent sources at their disposal, such as published price lists,
official import statistics and customs returns, and from the information obtained from other
interested parties during the investigation. It is clear, however, that if an interested party does
not cooperate and thus relevant information is being withheld from the authorities, this
situation could lead to a result which is less favourable to the party than if the party did
cooperate."

7.114 We now turn to Guatemala’s specific allegations and the related record evidence.
(ii) The Final Determination concerning resort to facts available
7.115 The first of Guatemala's facts available claims is that Economía unjustifiably decided to reject
Tubac's data in their entirety, and to rely instead on facts available (t he data from the application for
normal value and data from importers for export price). According to Guatemala, the data submitted
by Tubac were successfully verified by Economía, any problems in the data were small and Tubac
acted to the best of its ability. Thus, Guatem ala argues, Economía acted inconsistently with
paragraphs 3 and 5 of Annex II in rejecting the data, and had no basi s under Article 6.8 to resort to
facts available, as Tubac neither failed to provid e necessary information nor significantly impeded the
investigation. Mexico, for its part, argues that the problems encountered at verification were so
numerous and so significant that Economía was just ified in concluding that Tubac had deliberately
underreported and misreported its data, and thus that Tubac's entire database was biased and could not
be relied upon. In particular, Mexico argues, "to a lter figures has consequences for the investigation,
and these are set forth clearly in Article 6.8 of the Anti-Dumping Agreement: 'preliminary and final
determinations, affirmative or negative, may be made on the basis of the facts available' if a party
significantly impedes the investigation. To alter the fi gures deliberately is to impede the investigation,
so the company was aware of the consequences of its actions and cannot pretext that the investigating
authority failed to inform it that the differences in the adjustment have implications for all the data
used to calculate normal value."
181 Mexico asserts that Economía thus was fully justified in rejecting
Tubac's data in their entirety and relying on facts available.
7.116 We note in the first instance that the parties ag ree that Economía based its decision to reject
Tubac’s data as submitted on the results of verificati on - in particular the reasons cited in paragraph
80 of the Final Determination - and that paragrap hs 81 and 82 of that Determination contain the
explanation of the significance for the Determin ation of these reasons. These paragraphs are
reproduced in their entirety below. Both parties also agree that the verification report (Exhibits GTM-
15/MEX-12) constitutes the record evidence concerning th e results of the verification of Tubac's data.
We therefore will review the pertinent parts of th e Final Determination and the verification report in
detail.
7.117 In conducting this review, we recall our obligations under th e standard of review in
Article 17.6. In particular, we are bound to evalua te the claims and argumen ts before us, and to
render our findings, on the basis of what actually happened in the investigation as reflected in the
record thereof. We are not to reweigh evidence so as to conduct a de novo review of the evidence.
Nor are we to take into account post hoc arguments as to the reasons for decisions by the investigating

181 Mexico's response to question 181 from the Panel.

authority which reasons cannot be found in the authority’s own contemporaneous explanations
contained in its determinations a nd other documents of record. Rath er, we will consider whether a
unbiased and objective investigating authority could ha ve reached the conclusions referred to in the
Final Determination on the basis of the relevant r ecord evidence (namely the verification report) as to
what happened at verification.
7.118 The paragraphs of the Final Determination that pertain to the results of the verification of
Tubac's data and Economía's decision to resort to facts available read as follows:
"Verification visits
"78. Pursuant to Articles 83 of the FT A, 143 and 173 of the FTA Regulations, and
6.7 and Annex I of the Anti-Dumping Agreement, the investigating authority carried
out the following verification visits to ascer tain that the information and evidence
provided by the companies in the course of the proceedings were correct, complete
and came from their accounting records, to evaluate the methodology used in
presenting the information submitted, to colla te the documents in the administrative
file and obtain details on them. As rega rds the exporting company, the visit was
notified in advance to the Government of the Republic of Guatemala in accordance
with Annex I, paragraph 5 of the Anti-Du mping Agreement [subparagraphs A and B
provide the dates of the verifications of Tubac and Hylsa, respectively.]
79. The Ministry took detailed minutes of the abovementioned verification visits,
recording the results of the visits in ac cordance with Articles 83 of the FTA and
173 of the FTA Regulations. They have been pl aced in the administrative file of this
investigation and are public documents having full probative value within the
meaning of Articles 85 de la FTA, and 129 and 202 of the Federal Code of Civil
Procedure, which applies subsidiarily.
Results of the verification visit
80. From the verification visit and an anal ysis of the information provided by Tubac,
the Ministry found the following:
A. All the information which the company provided prior to the verification visit
and which was collated in the course of the visit with the company's accounting
records and the originals of the document s, pertains solely to standard pipe
manufactured to two international standard s, British Standard BS 1387: 1985 and
American Society for Testing and Materials standard ASTM: A53-97, both of which
are subject to hydrostatic testing.
B. The company explained that in the da tabase sent to the Ministry, it did not
record all the discounts, rebates and ref unds from domestic market sales and export
sales to Mexico and other countries. The verification team noted this when examining
the company's accounting records.
C. In examining the supporting accoun ting documents for the information
supplied by the company, it was noted that for four product codes, some of the figures
the company supplied before the verification visit and which were used in calculating
constructed value, do not come from its accounting records.
D. As to the adjustments for internal freight provided by Tubac, the team found
that in 57 per cent of the domestic market transactions reported prior to the

verification visit, the transport used to carry the goods was the customer's own, so the
company ought not to have reported any adjustment on this account. Similarly, in the
transactions regarding the market for exports to Mexico reported prior to the
verification visit, the Ministry found discrepancies between the export freight
reported and the export freight verified.
E. As to the adjustments fo r external freight, in examining a third export market
of Tubac's, the verification team found discrepancies between the figures reported
prior to the verification visit and the verified figures.
F. The company was unable to provide accounting documents in support of the
information it used to determine the adjust ments in respect of insurance and physical
differences reported to the Ministry prior to the verification visit.
 G. As to the exporting company's indicators for the headings production,
inventories, domestic market sales, export sales to other countries and installed
capacity for 1999 and 2000, and 1999 export sales to Mexico, in examining the
accounting information supplied by the company at the time of the visit the
verification team noted that the information sent to the Ministry prior to the visit was
not accurate and did not come from the accounting records.
 81. In view of the findings made in the course of the verification visit to Tubac
referred to in point 80 of this Resoluti on, the Ministry canno t use the company's
information to calculate normal value, export price or any price discrimination
margin because the information the company supplied prior to the verification visit
on transactions regarding domestic market sal es, exports to Mexico and exports to
other countries, constructed value, domestic and external freight and adjustments for
insurance and physical differences, is in complete, inaccurate and/or does not come
from the company's accounting records.
 82. Since the information supplied by the exporting company Tubac is not
complete, is inaccurate and/or does not co me from its accounting records, it will be
disregarded and the Ministry will proceed on the basis of the facts available, in
accordance Article 6.8 of the Anti-Dumping Agreement.
[…]
97. Because the information provided by the export company Tubac as described
in points 78, 79, 80, 81 and 82 of this Resolution was disregarded, the Ministry was
unable to determine a price discrimination ma rgin for the company on the basis of its
own information. Consequently, in accordan ce with Article 5.2 of the Anti-Dumping
Agreement which establishes that the appli cation to initiate an investigation shall
include evidence of: (A) dumping, (B) injury, and (C) a causal link between the two,
and that simple assertion, unsubstantiated by relevant evidence, cannot be sufficient
to meet the requirements of this provision, with Article 6.8 of that Agreement, and
with Article 54 of the FTA, the Ministry calculated the price discrimination margin
applicable to the company on the basis of the facts available.
98. The Ministry took as facts availabl e the information supplied both by the
applicant and by the importers of the inv estigated product, as described in points 102
to 114 of this Resolution."

7.119 Taking these passages together, we understand the Fi nal Determination first to describe, at
paragraph 80, problems encountered at verification, and then to conclude, in paragraphs 81 and 82,
that because of the nature and number of those problems, Tubac's data were disregarded, and facts
available were used instead. Paragraphs 97 and 98 indicate that the facts available to be used were the
data provided by Hylsa in the application and data obtained from importers.
(iii) Record evidence regarding the problems ref erred to in paragraph 80 of the Final
Determination
7.120 We turn now to a detailed examination of the record evidence regarding each of the problems
identified in paragraph 80 of the Final Determination.
Scope of the products for which Tubac provided data

7.121 The first of the issues cited in the Final Dete rmination, which appears at subparagraph A of
paragraph 80 of the Final Determination, is that Tubac provided data only on conduction pipe meeting
the ASTM A-53 and the BS-1387 standards, both of which are subject to hydrostatic (i.e., pressure)
testing. Factually, the record is clear that these were the only products on which Tubac provided data,
as indicated in paragraphs 7.74 and 7.75, supra.
7.122 As discussed in detail below, however, the parti es’ views differ as to the significance of this
issue as a factor leading to Economía’s decision to re ject all of Tubac’s data. For Guatemala, this
reference signifies that Tubac was penalized by Ec onomía (in the sense that Economía in part based
its decision to reject Tubac's data on this fact) for not having submitted data on any other products,
even though according to Guatemala, Economía never requested such data. 182 Mexico, at least in
certain submissions 183, disagrees with Guatemala's characterization of this aspect of the Final
Determination, arguing that Tubac’s not having pr ovided data on products other than A-53 and BS-
1387 pipe was not among the reasons for Economía’s rejection of Tubac’s data.
7.123 We will consider first the issues identified in subparagraphs B through G of paragraph 80 of
the Final Determination, which pertain to the data that were provided by Tubac. After this we will
consider the issue referred to in subparagraph A, as to the completeness of the scope of those data.
Underreporting of certain discounts, rebates and refunds
7.124 The problem as described in subparagraph B of paragraph 80 of the Fi nal Determination is
that at verification, Tubac explained that it had not reported in its questionnaire all of the discounts,
rebates and refunds related to inte rnal sales, and to exports to Me xico and third parties, and the
verification team confirmed this in reviewing Tubac's accounting registers. We asked Mexico to
identify which portion of the verification report identified this problem, and Mexico cited the
following passages:184

182 First submission of Guatemala, paragraphs 192-194.

183 See, Mexico's response to question 106 (a) from the Panel. As discussed at paragraph 7.159, infra.,
however, Mexico's position on this issue appears to have changed over the course of this dispute.

184 In question 107 from the Panel in connection with the first substantive meeting, we asked Mexico,
for each problem at verification cited in the Final Determination as a basis fo r resorting to facts available, to
provide a cross-reference to the pertinent passages in th e verification report, and to explain how each of these
passages supported the conclusion that Tubac's information was not verifiable or verified. Mexico submitted its
reply to this question only at the time of the second substantive meeting, and Mexico resubmitted this reply in
responding to question 132 from the Panel following the second substantive meeting. In question 132, we asked

Page 12:
"... the company informed the verification team that in preparing the supporting
accounting documents for the verification vis it, it realized that the credit, debit,
charge (cargo) and payment ( abono) notes were not entered in the database sent to
the Ministry."
Page 13:
"Credit notes

"Since the company did not include the charge , payment, credit and debit notes in the
database sent to the Ministry, at the verifi cation team's request it supplied the credit
note daily logbook (which included the cr edit, debit and payment notes) and the
general daily logbook (diario mayor general) of the corresponding accounts in which
these operations are entered for July 2000 - J une 2001. It also supplied copies of the
credit notes relating to the sales invoices included in the database."
7.125 We note that factually these passages from th e verification report indicate, as stated in
subparagraph B of paragraph 80, that Tubac's qu estionnaire response underreported discounts, rebates
and refunds. That said, however, these passages give only an incomplete picture of what happened at
verification in regard to this issue when all of the relevant passages of the verification report are
examined. We note in the first place that the pass age makes clear that it was Tubac itself that brought
this problem to the attention of the verification te am ("the company informed the verification team ")
on its own initiative. Second, the passages cited by Mexico omit the parts of the verification report
that describe what then occurred at verification in re gard to these missing data. This is set forth in the
following passages.
Page 12, immediately following the first passage above:
"At the request of the verification team
, the company provided the records of all notes
for the period July 2000 - June 2001, together with the supporting accounting
documents and reconciliation with the financ ial statements, and copies of the notes
affecting sales transactions pertaining to th e investigated product, recorded in the
aforementioned database.

... No significant differences were found , and the explanation and supporting
documents for the reconciled figures were to the satisfaction of the verification team
."
(emphasis added)
Page 13, immediately following the second passage above:
"Company staff explained the origin of every credit note and supplied accounting
records for the entire amount recorded in the credit note daily logbook. The
verification team checked that the entire amount recorded in the credit note logbook

Mexico to provide a copy of the Verification Report of Tubac with markings in the margins to identify the
relevant passages referred to in the cross-references it had provided in response to question 107. Mexico
submitted this annotated version of the verification repor t without an exhibit number, and then subsequently
submitted as Exhibit MEX-12 an unannotated copy of the verification report for Tuba c. We have transferred
Mexico's annotations to Exhibit MEX-12. Thus our references to Exhibit MEX-12 are to the annotated version
of the verification report for Tubac.

tallied with the accounting entries of the ge neral logbook and the statement of results,
and that the credit note data tallied with the credit note logbook."
7.126 The passages from page 12 come from the section of the verification report dealing with the
"Prueba de totalidad", in which the total sales fi gures for domestic sales and export sales to Mexico
and to third countries were verified. As the fu ll passages make clear, once the missing data were
provided by Tubac to the verification team, all of the totals in the accounting registers fully reconciled
and no further errors or problems were encountered. 185 The passages from page 13 come from the
subsection of the "Prueba de totalidad" section of the report entitled "Credit notes", and the same is
true there. That is, the missing data provided by Tubac were checked against the main diaries of
credit notes and no errors were found. In other word s, the problems that were found in the sales data
in the database due to the underreporting of discounts, rebates and refunds were corrected on the spot.
From the verification report, these appear to have been the only problems identified in respect of the
sales data.
Errors in certain data used for constructed value calculations
7.127 Subparagraph (C) of paragraph 80 of the Final Determination indicates that for four product
codes, certain cost figures reported by Tubac prior to verification, and with which constructed values
were calculated, could not be traced to Tubac's acc ounting records. Guatemala argues that there is no
corresponding reference in the verification report, and thus questions the factual basis for this finding
by Economía. In answer to our question, Mexico cited the following passage in the verification report
as the basis for this subparagra ph of the Final Determination.
186 We note that this passage, which is
the only one cited by Mexico as related to subparagr aph C, also is cited by Mexico as relevant to
subparagraph G. That is, Mexico cites no passage in the verification report that deals exclusively with
the problem referred to in subparagraph C of paragraph 80.
Page 11:
"The verification team selected the codes unde r investigation, collated the total sum
of the volume with that sent to the Ministry and found differences. The total of the
investigated codes was converted into United States dollars using the average
exchange rate of the relevant month. Differences were found with what had been
reported to the Ministry."
We see nothing in this passage related in any way to constructed value, which is the subject of the
problem referred to in subparagraph C of paragraph 80 of the Final Determination.
7.128 Looking elsewhere in the verification report, be ginning on page 14 we find an entire section,
divided into four subparts, devoted to constructed value. No passage in this section is cited by
Mexico as related to the content of subparagraph C of paragraph 80, however. Nor do we find any
indication in this section of any problems whatsoever at verification concerning the data that Tubac
had submitted in connection with cons tructed values. In particular, in the subpart on raw materials,
the verification report indicates that the correct volumes and values of raw materials had been
reported, as well as the correct average unit costs.
187 In the subpart on direct labour, the verification

185 Exhibits GTM-15/MEX-12, page 12, second paragraph under the heading "Prueba de totalidad".
See similar statements as to the lack of significant differences in the data, and the "satisfactory" results of this
part of the verification, in the first partial paragraph on page 13, and the first, second and third full paragraphs
on page 13, of the verification report.

186 Exhibit MEX-12.

187 Exhibits GTM-15/MEX-12, page 14.

report indicates that Tubac provided the monthly salary reports along with documentation and the
underlying accounting registers, and a work sheet for how Tubac had prorated the amounts to each
cost centre for each product code requested in the pre-verification notice.
188 Concerning indirect
labour, and indirect manufacturing costs, the verifica tion report at page 15 states that the verification
team confirmed the correctness of the costs de rived from the cost centre sheets, and that only
"differences of little significance" were found when the costs of production for selected product codes
taken from the cost sheets of the costs centre for total costs were compared to the production cost
reported by Tubac to Economía. Similarly, only " differences of little significance " were found in
converting the production costs from quetzales to do llars, and comparing these results with what
Tubac had reported to Economía. Concerning se lling and administrative expenses, financial
expenses, and profits, the verification report also contains no indication of any problems. To the
contrary, the report indicates that the verification t eam confirmed that the figures used to assign these
items to product codes came from Tubac's accounting registers, and that "no differences were found"
in calculating the factors that were used to assi gn these items to the product codes. As a further
indication that the verification team apparently w as satisfied with the constructed value data as
submitted, we note that in the section on adjustments for physical differences 189 the verification team
asked Tubac to recalculate the physical difference adjustments "based on the cost sheets that had been
validated and used for constructed value".
7.129 Based on the foregoing, we find no factual suppor t in the verification report for the statement
in subparagraph C of paragraph 80 that problems we re encountered in respect of constructed value
data for four product codes. Nor has Mexico iden tified any other factual support from the record for
this statement.
Internal freight and freight on exports to Mexico
7.130 Subparagraph D of paragraph 80 states that at verification, it was discovered that Tubac had
incorrectly included a charge in respect of freight fo r all of its internal sales, whereas in reality for
57 per cent of these sales the purchaser had used its own trucks to transport the merchandise.
Subparagraph D also states that Economía had encountered discrepancies between the freight reported
in respect of export sales to Mexico and the data that were verified.
7.131 In response to our request, Mexico identified the following passage in the verification report
as the basis for the statement in subparagraph D of paragraph 80 of the Final Determination
concerning internal freight:190
Page 7:
"It was found that in a large proportion of the sales to the Guatemalan market, the
customers' own transport was used, so ther e was no freight charge. However, in the
database sent to the Ministry, all internal sales transactions were adjusted for freight."
7.132 Here, similarly to the case of subparagraph B, we note that while factually this passage from
the verification report indicates, as stated in subparag raph D of paragraph 80, that in Tubac's database
internal freight charges were incorrectly attributed to certain domestic sales, the full content of the
verification report related to this issue tells a different story from that reflected in the Final

188 Ibid.

189 Exhibits GTM-15/MEX-12, page 10.

190 Exhibit MEX-12.

Determination. In particular, immediately foll owing the passage cited by Mexico, the verification
report states:
Pages 8 and 9:
"During the visit, every transaction involv ing a freight charge was identified and a
check was made in the company's accounting system that the operation actually took
place, including the amount corresponding to freight.
The company was asked to supp ly an electronic and a paper list of all operations
involving freight. From the list, ten oper ations entered as involving freight were
selected for examination in the accounting syst em in order to check that an amount
was actually charged for freight.
From the examination, no discrepancies were found between the information
examined and that in the company's accounting system. The Ministry will therefore
remove adjustment for freight from the database for all operations in which the
customers' own trucks were used for transport." (emphasis added)
7.133 Taking all of these paragraphs together, it is clear that, although the data submitted in the
questionnaire response incorrectly attributed an inte rnal freight charge to certain domestic sales, at
verification this error was corrected through the veri fied identification of the sales that did not include
a freight charge, and that Economía was satisfied with these corrections (given its stated intention to
adjust the data base on the basis of the verification results).
7.134 In response to our request, Mexico identified the following passage in the verification report
as the basis for the statement in subparagraph D of paragraph 80 of the Final Determination
concerning freight to Mexico:
191
Page 8:
"Because, in the sales to Mexico, the freight adjustment figure was an average, an
examination was done of a sample of fifteen invoices of transport companies for
which the amount was obtained in quetzals pe r tonne and converted into dollars using
the end-of-period exchange rate for each month of the investigation period. The
figure in dollars per tonne for each operation in the sample of invoices to transporters
was used to obtain a simple average freight cost. That figure must replace the
average figure for freight entered in the database, because it is verified information."
7.135 Here, we do not read this passage of the veri fication report as referring to any problem or
discrepancy in the data at all. Rather, we view this passage as indicating that the verification team
decided that, rather than verifying the freight charge on export sales to Mexico as reported by Tubac
by examining each such transaction in the data b ase and recalculating the average freight charge on
this basis, it would select a sample for which it w ould verify the data, and then would calculate the
freight charge on the basis of the sample it had selected. Obviously, the average freight charge
calculated on the basis of a subset of the relevant transactions will almost certainly be different from
the average freight charge calculated on the basis of all of the relevant transactions. This, however,
would not make the original figure wrong, and indeed we do not read the verification report as
suggesting that the figure reported in Tubac's questionnaire response was found to be wrong. We thus
do not consider that this passage factually supports the statement in paragraph D that discrepancies
were found in the data reported by Tubac on freight charges in respect of its export sales to Mexico.

191 Ibid.

Discrepancies in freight on third country export sales

7.136 Subparagraph E of paragraph 80 of the Final De termination indicates that at verification,
discrepancies were found in the information that had been reported concerning shipping charges for
export sales to a third country. In response to our question, Mexico identified the following passage
in the verification report as corresponding to this subparagraph:192
Page 9:
"For freight to Costa Rica, a payment made to a transport company in two of the sales
operations reported in the database was presen ted. On the basis of the information
from these invoices an adjustment for freight was calculated that did not tally with the
one in the database. Although the two vary only slightly , the correct information is
the verified information. This new inform ation is the weighted average of the two
freight operations to Costa Rica. The figur es used to calculate the freight average
were taken from the sample of sales to third markets."(emphasis added)
7.137 We do not consider that this passage points to any error at all in the data reported by Tubac
for freight charges on sales to Costa Rica. Rather, as was the case in respect of the freight charges on
export sales to Mexico, it appears from this passage that the verification team chose to verify the
freight charges for sales to Costa Rica on the basis of a sample of two transactions from the data base,
rather than by recalculating the charges for all of the transactions in the data base. Thus, it appears
that the reason for the difference that was found, wh ich was characterized as "pequeña", was simply
that the two figures were calculated on the basis of two different sets of data, one being a subset of the
other (which subset was chosen by the verificati on team). We thus do not see that this passage
factually supports the statement in subparagraph E that discrepancies were found in the freight
charges on third country sales.
Adjustments for insurance and physical differences
7.138 Subparagraph F of paragraph 80 of the Final De termination indicates in respect of insurance
and physical differences that at verification, Tubac was not able to provide support from its
accounting records for the previously-reported informa tion that it had used to determine adjustments
for insurance and for physical differences.
7.139 Concerning insurance, in response to our request, Mexico did not identify any corresponding
passage in the verification report. 193 The verification report, however, contains the following passage
pertaining to insurance:
"To back up the export insurance figure, th e transport policy of Aseguradora General
S.A. was presented, which sets out the rate applying to the amount of the sale. Also
presented were two partial payments to Aseguradora General and a company called
Occidente de Seguros . These payments covered two months of the investigation
period, November and December 2000. The endorsements submitted for the two
insurance companies set out the amount of the premium applied to the value of the
goods transported.

192 Ibid.

193 Ibid.

Furthermore, the value of sales for November and December 2000 was presented in
order to corroborate that the total of th e amounts insured in the two companies is
similar to the total monthly sales of Tubac S.A." 194
7.140 We do not read this passage as identifying an y problems that were found at verification.
Rather, it simply describes the supporting documents that Tubac presented regarding the adjustment it
had calculated, and indicates that the documents s howed that the sum of the insured amounts for two
particular months was similar to the total monthly sales of Tubac. We thus find nothing in this
passage that factually supports the statement in subparagraph F that Tubac was unable to provide
support from its accounting records for the insura nce adjustment reported in its questionnaire
response.
7.141 Concerning the adjustments for physical differences , Mexico identified the following passage
as corresponding to the reference in subparagraph F:195
Page 10:
"Physical differences

"The verification team asked the company for an explanation of the methodology
used to the determine physical differences. The company was unable to reproduce
the methodology, so the Ministry asked it to calculate the cost differences on the basis
of the validated cost centre sheets used for constructed value. Using this
methodology the company worked out ne w physical difference figures, which
differed significantly from the ones submitted during the investigation."
7.142 This passage indicates factually that at veri fication Tubac was not able to reproduce the
methodology it had used to calculate the adjustments fo r physical differences that were reported in its
questionnaire response, as stated in subparagraph F. It is also clear from this passage, however, that at
verification Economía not only identified an alternat ive basis on which to calcu late these adjustments
– namely the cost data that had been verified in connection with constructed value – but also had
Tubac perform the recalculations on the spot from those verified data. In other words, at verification,
Economía obtained and successfully verified corrected data on these adjustments.
Indicators for Tubac
7.143 Subparagraph G of paragraph 80 of the Final Determination states that at verification,
Economía found that certain information that Tubac had reported in its questionnaire response
concerning its indicators was inexact and did not come from Tubac's accounting registers. The
information identified was: production, inventori es, domestic sales, export sales to third countries,
installed capacity for 1999 and 2000, and export sal es to Mexico for 1999. In response to our
question, Mexico identified the following passag es in the verification report as corresponding to
subparagraph G:196

194 Exhibits GTM-15/MEX-12 at pages 9-10.

195 Exhibit MEX-12.

196 Ibid.

Page 11:
"The sales for July and December 2000 were reviewed together with the "Prueba de
totalidad" of the sales, which is described in the relevant paragraph of this report. The
figures reviewed for volume and value were collated with those in Annex A3 and the
differences found were of little significance
." (emphasis added)
"... The verification team selected the codes subject to investigation, and compared
the total volume with that sent to the Mini stry and noted differences. It converted the
total amount pertaining to the investigated codes into United States dollars using the
average exchange rate of the correspondi ng month, and found differences with the
figures sent to the Ministry."
7.144 Concerning this passage, we note first that it refers exclusively to sales
, and does not refer at
all to production, inventories or installed capacity. Second, we take note of the first sentence of the
passage, which indicates that th is review was undertaken in c onjunction with the "Prueba de
totalidad". As discussed above, at paragraphs 7.12 4 to 7.126, the verification report states that once
the adjustments for the discounts, rebates and refunds were corrected , the "Prueba de totalidad" was
verified satisfactorily. We infer from this that th e discrepancies in the sales data referred to in the
passage quoted above derived from the same source, a nd ultimately were satisfactorily verified in the
context of the "Prueba de totalidad". Indeed, if this were not the case, we do not see how the
verification report could have indicated that the "Prueba de totalidad" ultimately was satisfactorily
verified.
7.145 While, as noted, the passage of the verification report cited by Mexico in response to our
question does not refer at all to production, invent ories or installed capacity, other sections of the
verification report do address these topics. We exam ine each of these in tu rn to see whether they
provide factual support for the statement in su bparagraph G of paragraph 80 of the Final
Determination.
7.146 Concerning production, the verification report contains the following passage:
Page 10:
"Production
"The company explained that in preparing the supporting documents for the
information in Annex 3, it found differenc es with the information sent to the
Ministry. It therefore supplied a worksh eet identifying the differences and sent the
production reports in units and tonnes for th e manufacturing and galvanization plants
for January-December 2000 and reports on the value of production for the selected
months."
"The verification team collated the pr oduction volume shown in the production
reports with that in the worksheet s upplied at the verification and found no
differences. The production evaluation by product family was likewise collated with
the general daily log and no differences were found." (emphasis added)
7.147 We do not consider that this passage provides factual support for the characterization in
subparagraph G that the verification team encounter ed discrepancies in the production figures during
verification. To the contrary, this passage indicat es (1) that it was Tubac that discovered problems in
the data that it had provided in its questionnaire respon se, that brought this matter to the attention of
the verification, and that furnished documentation and calculations reconciling the differences; and (2)

that the verification team reviewed this corrected information in detail and found no discrepancies at
all. In other words, at verification Tubac voluntarily identified the error and provided corrected
information, which Economía verified on the spot.
7.148 Concerning inventories
, the verification report contains the following passage:
Page 11:
"Inventories
"The company provided reports of inventories from the inventory system and added
up the volume of the investigated codes. The verification team compared this total
with that sent to the Ministry and found differences. The company also provided the
inventory value lists showing the investig ated codes. The total by family was
collated with the general daily log for th e selected months and no differences were
found."
7.149 This passage indicates factually that certain diffe rences were identified in the inventory data.
There is no indication of the size of the differences. We note that these differences were limited to the
information on inventory volume, however, as the verification report indicates that no differences
were encountered in the data reported by Tubac on th e value of inventories. The passage also makes
clear that Economía obtained the correct volume figures from Tubac's accounting records.
7.150 Concerning installed capacity
, the verification report contains the following passage:
Page 11-12:
"Installed capacity

"The company explained that it calculated installed capacity for 1 ¼" light conduction
pipe (tubo de cañería liviano de 1¼) because this is the product that represents the
company's average production. It also said that real installed capacity was calculated
using the average monthly output and mach ine utilization data for the period from
January to May 2002."
"For the purpose of the review the comp any supplied worksheets showing ideal and
real installed capacity, the data on downtim e, the output data for January-May 2002
and the technical specifications of the plant mill. "
"To verify ideal installed capacity, the verification team collated the data on
theoretical maximum speed of output with the technical specifications of the mill.
Pipe weight was collated with the technical specifications of the product; the
arithmetical calculations were checked, a nd no differences were found. The plant's
installed capacity was determined on the basis of real machine utilization, the
percentage of which was compared with the data on mill downtime, and average
monthly output was collated with the output data for January-May 2002. Differences
were found with the information supplied to the Ministry."
7.151 Factually, this passage indicates that some di fferences were encountered at verification in
respect of at least part of the capacity data that Tubac had reported in its questionnaire response. The
passage does not make clear the exact nature of the differences, and indeed indicates that some of the
data were verified with no differences found. The passage also indicates that at verification, the
installed capacity figure was "determined" on the ba sis of the information examined concerning the

utilization of the machinery, machine downtime, and production reports. From th is we conclude that
while certain differences were encountered in the data as reported in the questionnaire response, the
verification process itself resulted in a correct and verified calculation of the capacity figures.
Product scope of the data provided by Tubac (subparagraph A of paragraph 80

7.152 We now turn to the remaining issue listed in paragraph 80, the product scope of the data
provided by Tubac , in particular, the limitation of those da ta to A-53 and BS-1387 pipe. As noted
above, Guatemala argues that this reference signifi es that Tubac was penali zed by Economía for not
having submitted data on any other products (in the sense that Economía in part based its decision to
reject Tubac's data on this fact), even though according to Guatemala, Economía never requested such
data.197 We note that this issue is closely relate d to Guatemala's argument (in respect of which it
raises a number of claims) that, late in the in vestigation, Economía expanded the scope of the
investigated product by adding certain structural tu bing. In the context of this claim, Guatemala's
argument is that the scope of the data that Tubac submitted corresponded to the initial definition of the
investigated product, but that once the structural tubing was added to the investigation, Tubac was
faulted by Economía for the "incompleteness" of its data submission, i.e., for not having submitted
data on the structural products in question, in spite of the fact that Economía had never requested such
data.
7.153 Mexico disagrees with Guatemala's characterization of this aspect of the Final Determination.
Mexico argues that Tubac’s not having provided da ta on products other than A-53 and B-1387 pipe
was not among the reasons for Econom ía’s rejection of Tubac’s data.198 Rather, Mexico argues, the
references in paragraphs 81 and 82 to "incompleteness" of data were to what Mexico characterizes as
the deliberate incompleteness of the data that were presented by Tubac in its questionnaire
response.199 Mexico offers no explanation of the significance of subparagraph A of paragraph 80.
7.154 As noted above, this issue is closely related to the factual question as to the scope of the
investigated product, in particular whether produc ts produced by Tubac other than A-53 and BS-1387
pipe were covered by the investigation. We recall in this regard our finding, supra, that as alleged by
Guatemala, Economía twice during the course of the investigation expanded the scope of the
investigated product, the second time by adding – la te in the investigation – certain structural
tubing.200 These late-added structural tubing products did not correspond to either of the technical
standards referred to in subparagraph A of paragraph 80, that is A-53 or BS-1387.
7.155 With this background, we examine the meaning of subparagraph A of paragraph 80, i.e., what
the Final Determination indicates as to whether th e content of this subparagraph was or was not a
factor that contributed to Economía's decision to rej ect Tubac's data in their entirety. Here, we note
first that paragraph 81 refers to the content of pa ragraph 80 in its entirety as the basis for Economía's
conclusion that "[Tubac's data] cannot be used to calculate ... a price discrimination margin."
Paragraph 97, which addresses the use of facts availabl e due to Tubac's data being disregarded, makes

197 First submission of Guatemala, paragraphs 192-194.

198 Mexico response to question 106 (a) from the Panel.

199 Ibid.

200 We recall that the first change, which consisted of an expansion of the range of diameters covered
by the investigation, is evident on its face, as the product definition in the preliminary determination refers to a
broader range of diameters (1/2" to 6") than the Initiation Determination (1/2" to 4") cites. As this change is not
relevant to Guatemala's facts available claims, we do not consider it further here.

a similar reference to paragraph 80 in its entirety. T hus, to us it is clear that the role of paragraph 80
in the Final Determination is to identify problems that were encountered in Tubac's data.
7.156 Turning to the specifics of paragraphs 81 an d 82, we note that the "incompleteness" of
Tubac's data is identified as one of the problems (refe rred to in paragraph 80) that led to the data's
rejection. In particular, paragraph 81 states: "[B]earing in mind the facts found during the
verification visit to Tubac referred to in point 80 of this Resolution the Ministry cannot use its data ...
because the information ... is not complete …" (emphasis added). Paragraph 82 states that to the
extent the information was inter alia incomplete, it was rejected and facts available used instead.
7.157 In this regard, among all of the subparagraphs of paragraph 80, subparagraph A is the one that
deals clearly and exclusively with the "incompleten ess" of the data base. The other subparagraphs
refer to discrepancies between the data submitted in the questionnaire response and the data in Tubac's
accounting records. Thus, we read the issue iden tified to in subparagraph A as at least being among
the problems of data incompleteness to which paragraphs 81 and 82 refer.201
7.158 Furthermore, concerning the refere nce in subparagraph A to the fa ct that Tubac's data related
to products corresponding to only two particular technical standards, other parts of the Final
Determination make clear how central in the inves tigation were the related questions of technical
standards and the presence or absence of hydrostatic testing to the question of the product scope.
First, the Final Determination (at paragraphs 10-30) presents a lengthy recapitulation of the parties'
exchanges of views on the scope of the investigated pr oduct. From that description, it is clear that the
parties vigorously debated this issue, and in partic ular that they held very different views as to
whether technical standards, including the requirement for hydrostatic testing, were determinative as
to the scope of the product (in particular the suitability of various dimensions of pipe and tube for use
in conduction applications). Then , at paragraphs 31 and 32, the Final Determination describes the
scope of the investigated product as being based essen tially on the diameter and wall thickness of the
product, without regard for the technical standard to which the product is produced, or the raw
material from which it is made (hot- or cold-rolled steel sheet). Given all of this context, we read the
characterization in subparagraph A of para graph 80 of Tubac's data as "exclusively " pertaining to A-
53 and BS-1387 pipe, "both subject to hydrostatic testing " as a reference to a problem or a
shortcoming in the data submitted by Tubac formi ng part of Economía's justification for rejecting
those data.
7.159 Finally, we note that Mexico's position on this point appears to have changed over the course
of this dispute. While in its answers to questions Mexico argues that Tubac's restriction of its data to
A-53 and BS-1387 pipe was not a factor th at led Economía to reject those data 202, Mexico's first
submission seems to indicate the contrary. In particular, in that submission Mexico states that "from a
mere reading of the Guatemalan exporter's replies to the official questionnaire ... it can be seen that
the exporter did not provide all the necessary information, nor di d it provide complete, accurate and
precise information in the course of the investigation". 203 Because, as regards the completeness of the
data provided by Tubac, the "mere reading" of the questionnaire response only indicates that those
data were limited to A-53 and BS -1387 pipe, we see no other possible basis for Mexico's statement in
its submission that Tubac did not provide "all the necessary informati on". Furthermore, later in the
same submission, Mexico quotes paragraph 80 of th e Final Determination in its entirety (i.e.,

201 Nor, apart from the issue of underreporting of discounts, rebates and refunds – which was resolved
on the spot at verification – do we see in the verification report any reference to incompleteness of data.

202 Response to question 106 (a) from the Panel.

203 First written submission of Mexico at para. 142 (emphasis in original).

including subparagraph A), as the description of the "inconsistencies" encountered during
verification
204, and then states that "... the exporter's information was deliberately incomplete ...".205
7.160 In sum, we find the Final Determination to i ndicate that Tubac's not having provided data on
any products other than A-53 and BS-1387 pipe was deemed by Economía to be a flaw in Tubac's
data, in the sense that those data were incomplete (in the light of Economía's Final Determination as
to the scope of the investigated product), and that this incompleteness was a factor underlying
Economía's decision to reject those data. Although Mexico has argued to the contrary before us, it
points to no record evidence in support of its argument, and in fact, as noted in the preceding
paragraph, its position before us on this point appears to have shifted during the course of this dispute.
(iv) Substantive aspects of Article 6.8 / Annex II claims
7.161 We turn now to an analysis of these facts in the light of the provisions cited in Guatemala's
claim, i.e., Article 6.8 and Annex II. Given that Article 6.8 requires that the provisions of Annex II be
observed in applying Article 6.8, we begin our anal ysis with Annex II. In particular, we note that,
concerning the substance of Economía's decision to rej ect Tubac's data and resort to facts available,
the particular provisions of Annex II cited by Guatemala are paragraphs 3 and 5 of Annex II.
Concerning paragraph 3, Guatemala argues that th e record evidence contains no indication that
Tubac's data were not verifiable, or that usi ng these data would have caused "undue difficulties".
Concerning paragraph 5, Guatemala argues that T ubac fully cooperated in the investigation and
provided all of the data requested of it by Economía and thus "acted to the best of its ability", and that
the record does not support a conclusion to the contra ry. Mexico, for its part, argues that on the basis
of the problems found at verification, Economía concluded that Tubac had "failed to provide
necessary information", and had "failed to coopera te" and as a result had "significantly impeded the
investigation", for both of which reasons Economía's rejection of Tubac's information and resort to
facts available was fully justified.
7.162 In the light of these claims and arguments we start our analysis by considering whether the
record evidence supports a conclusion that Tubac's da ta were not "verifiable", and could not be used
without "undue difficulties" in the sense of paragraph 3 of Annex II, and that as Mexico argues, Tubac
deliberately submitted biased information such that Economía was justified in rejecting all of Tubac's
data. We also consider whether the basis for this decision is clearly and adequately set forth in the
Final Determination.
7.163 We consider the "verifiability" of the data in the sense of paragraph 3 of Annex II to be
central to this claim. In this regard, we unders tand Mexico's position to be, in part, that significant
errors in Tubac's submitted data were found at ve rification, the overall effect of which was to cast
doubts on the accuracy of the entire data base. We consider this argument in the light of whether on
the basis of the record eviden ce, a unbiased and objective investigating authority could have
concluded that the individual problems identified in paragraph 80 were such that, in terms of
paragraph 3 of Annex II, the data as a whole were unreliable. We further consider whether the
evidence could support a conclusion that it would have been "unduly difficult" to use the data
submitted by Tubac, in the light of the identified prob lems. In this context we consider the existence
and nature of these problems, whether corrected data were available to Economía, and whether there
is evidence that using any such co rrected data would have delayed th e investigation (that is, whether
the data were submitted in an "untimely" fashion), or posed any other "difficulties".

204 Ibid. at para. 147.

205 Ibid. at para. 148.

7.164 In this regard we take the same approach as th e Panel in Egypt – Steel Rebar in considering
that paragraphs 3 and 5 of Annex II together set fort h the substantive elements for a justified decision
to reject a party's information and resort to facts available. 206 We also note that the Appellate Body's
ruling in US – Hot-Rolled Steel is consistent with th at approach, in that the Appellate Body ruled that
investigating authorities "are not entitled to reject information submitted" if that information meets the
conditions in paragraph 3 of being "verifiable", "appropriately submitted so that it can be used without
undue difficulties", and "supplied in a timely fashion" 207. The Panel in US - Steel Plate considered
that information is verifiable when "the accuracy and reliability of the information can be assessed by
an objective process of examination" 208. That Panel also found that the term "undue difficulties" are
difficulties "beyond what is otherwise the norm in an anti-dumping investigation", and that an
investigating authority is required by paragraph 6 of Annex II "to explain the basis of a conclusion
that information which is verifiable and timely s ubmitted cannot be used in the investigation without
undue difficulties."209 Finally, we note in connection with th is claim the Panel's characterization as a
case-by-case question whether a conclusion that some information fails to satisfy the criteria of
paragraph 3 and thus may be rejected can justify th e rejection of other information that would, in
isolation, have satisfied the criteria of paragraph 3 210, as we view this as an important element of
Mexico's argument.
7.165 Starting with the nature of the identified pr oblems, we recall the record evidence and our
observations related to each point listed in paragraph 80:
• For the product scope of the data provided by Tubac (i.e., the reporting of data only
on A-53 and BS-1387 pipe), the verification report and other evidence make clear that
this was fully known to Economía well before the verification visit, that Economía
had confirmed the correctness of the product scope of Tubac's data to Hylsa before
the verification visit, and that Economía reconfirmed at several points during the
verification visit the correctness of that pr oduct scope. The record evidence also
makes clear that at no point did Economía ever request Tubac to provide data on any
other of its products.
• For discounts, rebates, refunds, and credits
, although some information was omitted
from the data as submitted, at verification the correct data were obtained and
satisfactorily verified on the spot.
• For data used to calculate constructed values
, there is no reference in the verification
report to any problems being found, and we thus see no factual basis for the statement
in the Final Determination that there were any such problems.
• For data on internal freight, although the data base as s ubmitted incorrectly attributed
freight charges to certain transactions, at ve rification the correct data were obtained
and satisfactorily verified on the spot.

206 Panel Report, Egypt – Steel Rebar at para. 7.159.

207 Appellate Body report, US - Hot-Rolled Steel at paragraph 81. As in the Hot-Rolled Steel case, the
fourth condition listed in paragraph 3, that the information is supplied in a medium or computer language
requested by the authorities, is not at issue in this dispute.

208 Panel Report, US – Steel Plate, at footnote 67.

209 Ibid., at paras. 7.72 and 7.74.

210 Panel Report, US –Steel Plate, at paragraph 7.62.

• For freight on export sales to Mexico
 and freight on third country export sales, the
verification report contains no evidence of any error, but instead states that
differences arose because the verification team verified these elements on the basis of
samples rather than the entire data base. We thus see no factual basis for the
statement in the Final Determination that there were any such problems.
• For adjustments for insurance
, there is no reference in th e verification report to any
problems being found, and we thus see no factual basis for the statement in the Final
Determination that there were any such problems.
• For adjustments for physical differences
, although certain discrepancies were found,
at the request of the verification team T ubac recalculated the adjustments on the basis
of the cost data that had been verified in the context of constructed value. Thus, the
record indicates that at verification, the correct data were obtained at the express
request of the verification team.
• For Tubac's indicators, the verification report indicates that of its own initiative Tubac
informed the verification team that it had discovered errors in the production data it
had reported, and that Tubac presented th e verification team with worksheets and
supporting documentation that resolved the e rrors to the satisfaction of the team.
Concerning sales , the verification report characterizes some of the differences as
"poco significativas", and in respect of the other differences, because these were
encountered in the verification of the "Prueb a de totalidad" they appear to have been
related to the underreporting of discounts, reba tes, and refunds referred to above, and
to have been resolved in that connection, as the correction of these data led to the
"satisfactory" verification of the "Prueb a de totalidad". Concerning inventories , the
verification report indicates that differen ces were found in the data on inventory
volume, but not value. Concerning capacity , the verification report indicates that
some differences were found, but that the co rrect capacity figures were calculated at
verification.
7.166 As indicated in the foregoing summary, there is no record evidence of the existence of any
problem in respect of the data on constructed value, on freight charges for export sales to Mexico or to
third countries, or on adjustments for insurance . Thus, the record evidence indicates that these data
were fully verified without any difficulties or qu estions, from which we conclude that they were
"verifiable" in the sense of paragraph 3 of Annex II.
7.167 For the price-related data where discrepancies were found (i.e., for discounts, rebates and
refunds, for internal freight, and for adjustments for physical differences) the record evidence
indicates that corrected data were obtained and verifi ed on the spot. We conclude from this that these
data as well were "verifiable" because they were in fact verified. The further question becomes
whether it would have been "unduly difficult" fo r Economía to have used these data, including
whether the corrected data became available so late in the investigation that using them would have
delayed the investigation. There is nothing in the record evidence that indicates that there would have
been any difficulty in using any of the individual corrected data elements obtained at verification, nor
is there any such statement in the Final Determina tion. Indeed, the verification report itself states in
respect of at least one of these data elements (the internal freight adjustment for domestic sales) that
Economía would correct the data base provided by Tubac on the basis of the corrections that had been
obtained and verified during the verification visit.
211 As for timeliness, there is no indication in the
Final Determination that any data co rrections were made after the verification visit, or that there was

211 GTM-15/MEX-12 at pages 7-8.

any issue of shortness of time available to Econom ía to perform the dumping calculations for the
Final Determination. Indeed, given that the ve rification visit took place in June 2002, Economía had
had the corrected data in its possession for more than six months by the time the Final Determination
was issued in January 2003.
7.168 For the discrepancies in the data on Tubac's economic indicators (i.e., for production, sales,
inventories, and capacity), here as well the record evidence indicates that corrected data were obtained
at verification and verified on the spot. Thus, we consider that the record evidence indicates that these
data were "verifiable" because they were in fact ve rified. Nor do we find an y basis to conclude that
even if, hypothetically, some of the data on the economic indicators could be considered
"unverifiable", this would have made it "unduly di fficult" for Economía to have used the verified
pricing data to calculate the dumping margins. Th is is because we do not see a particular analytical
connection (nor, more importantly, does the Final Determination identify any) between data on the
company's production, inventories and capacity and the pricing data that would be used to calculate
dumping margins.
7.169 Concerning the product scope of the data submitted
 by Tubac, given our finding that the
record indicates that Economía faulted Tubac fo r having provided data only on A-53 and BS-1387
pipe, we consider whether there is factual eviden ce that Economía ever specifically requested any
pricing data from Tubac (such as would be necessary to calculate dumping margins) on products other
than these, either in the questionnaire or at any point thereafter. We find no record evidence of any
such request, nor does Mexico argue that any such request was made.212 In this context we emphasize
that whatever issues there may have been at various points dur ing the investigation regarding product
scope (and we note Tubac's requests for clarifica tion on this point from the very outset of the
investigation), the facts of record show that Tub ac was fully transparent thr oughout the investigation
as to the scope of the products for which it reported data and its reasons for doing so. There is no
evidence to the contrary, and indeed Mexico conf irmed Tubac's transparency in this regard in
response to questioning by the Panel. 213 Nor did Economía, before the final phase of the
investigation, raise any issue in this respect. 214 To the contrary, Economía itself on numerous
occasions confirmed the correctness of the scope of the data provided by Tubac, including during the
technical meeting with Hylsa and at verification (where the verification team at several points
identified Tubac's product codes that were covered by the investigation). Thus the evidence is
unequivocal that Economía was fully aware of the pr oduct scope of the data provided by Tubac, and
never identified to Tubac that there was any problem in this regard, or sought data on other products.
7.170 We now consider whether the inclusion of only two specifications of pipe in Tubac's data
base, as referred to in subparagraph A of paragra ph 80, as such could have rendered that data base
"unverifiable". We conclude that this scope lim itation in itself could not have done so, because only
if there were record evidence of other problems with the data contained in the data base could the data
base overall potentially become unusable in respect of the products it included. In this connection, we
recall our conclusions in paragraphs 7.166-7.168, supra, that the evidence does not support a finding
that the specific problems in respect of certain data elements as refe rred to in the other subparagraphs

212 Mexico states in response to question 106 (d) from the Panel, that Economía's only request to
Tubac for information on the structural tubing at issue in this dispute was via the information request to which
Tubac responded on 17 September 2002. (Exhibit GTM-22) We note, however, that this information request
had nothing to do with price data, and instead went to the question that had been raised at the public hearing as
to whether the structural products should be added to the scope of the investigation.

213 Response to question 106 (c) from the Panel.

214 Response to question 106 (d) from the Panel.

of paragraph 80 rendered those partic ular data elements unverifiable, or that using them would have
been unduly difficult for Economía.
7.171 We next evaluate whether in spite of the "ver ifiability" of these data ite ms individually, there
is record evidence that supports Mexico's position that these problems taken together so undermined
the credibility and reliability of the data base as a w hole as to render that data base unusable. We do
not consider that an unbiased and objective inves tigating authority could have concluded that the
problems listed in subparagraphs B through G of the Final Determination, when evaluated in the light
of the verification report, rendered the data base as a whole unreliable. In this regard, we recall that
for a number of the problems referred to in these subparagraphs , we have found no
 record evidence
whatsoever that the cited problems even existed. For the rest, it appears from the verification report
that the errors were corrected on the spot without difficulty. We see no factual basis for the implicit
characterization in the Final Determination that th ese errors were pervasive and fundamental, such
that they would affect the overall credibility of the da ta base. Rather, in the light of the verification
report, it appears to us that Economía applied an unacceptably demanding standard, namely that no
error encountered in the data base provided by Tubac, no matter how small, could or would be
corrected, even where correct data were obtained and verified during the verification visit.
7.172 This brings us to a consideration of whet her, as claimed by Guatemala, Economía acted
inconsistently with para graph 5 of Annex II. In particular, we have found above that the record
evidence does not support a conclusion that the data submitted by Tubac, in spite of errors or
discrepancies as reflected in the verification report, were unverifiable in the sense of paragraph 3 of
Annex II. We now take up the question of whet her the evidence supports a conclusion, as argued by
Mexico, that the identified errors and discrepancies were the result of deliberate action by Tubac to
provide incorrect and biased information, and that T ubac thus did not cooperate. In this context,
Guatemala argues that Tubac "acted to the best of its ability" in the sense of paragraph 5 of Annex II,
and that Economía therefore acted inconsistently with that provision in rejecting Guatemala's
information. Mexico disputes that Tubac acted to the best of its ability and argues that to the contrary,
Economía "considered that Tubac changed the physical difference adjustment figures in order to bias
the dumping margin calculation to its advantage" 215, and that Economía in fact "considered whether
the exporter acted to the best of its ability and … found evidence that not only had the exporter not
acted to the best of its ability, but it done everythi ng it could to slant or hide information needed for
the investigating authority's analysis, so the inves tigating authority disregarded the information from
the Guatemalan exporter".216
7.173 We find useful guidance for our examination of this aspect of Guatemala's claim in previous
disputes that have considered paragraph 5 of Annex II. The Appellate Body in US – Hot-Rolled Steel
considered that "investigating authorities are entitled to expect a very significant degree of effort – 'to
the best of their abilities' – from investigated exporte rs. At the same time, however, the investigating
authorities are not entitled to insist upon absolute standards or impose unreasonable burdens upon
those exporters". 217 The Panel in US – Steel Plate stated that "paragraph 5 can be understood to
highlight that information that satisfies the requirements of paragraph 3, but which is not perfect, must
nonetheless not be disregarded".218

215 Mexico's response to question 179 from the Panel.

216 Mexico's response to question 182 from the Panel.

217 Appellate Body Report on US - Hot-Rolled Steel, paragraph 102.

218 Panel Report on US – Steel Plate, paragraph 7.65.

7.174 Given the nature of the parties' respective arguments as to whether or not Tubac acted to the
best of its abilities we consider first whether as a factual matter there is evidence in the record
supporting Mexico's characterization that the information provided by Tubac was deliberately
misleading.
7.175 We first return to the question of the product sc ope of the data reported by Tubac, which is
relevant here to the extent that part of Economía 's decision to resort to facts available may have
hinged on an assessment that Tubac failed to act "to the best of its ability" in the sense of paragraph 5
of Annex II by not providing data on any ot her products than A-53 and BS-1387 pipe. 219 We view
paragraph 1 of Annex II as relevant context for answering this question, in that this provision makes
clear that it is the investigating authority's responsib ility in the first instance to inform an interested
party of the precise information that it requires of that party (i.e, the "necessary information" in the
sense of Article 6.8.) We note here that being fu lly aware from the outset as to the product scope of
the data provided by Tubac, and not having request ed Tubac to provide data on any other products,
Tubac's not having provided such data clearly could not be considered a failure on its part to have
acted to the best of its ability in this respect.
7.176 Concerning Mexico specific arguments before us on this issue, we recall that at our second
substantive meeting, we questioned Mexico in detail about the problems that it argued justified
Economía's decision to reject all of Tubac's data. Mexico stated that at verification, Economía had
discovered large problems in Tubac's selection of the product codes that it had included in its data
base. We asked where in the Final Determina tion this problem was identified and addressed, and
Mexico identified subparagraph F of paragraph 80. We then asked Mexico to explain the connection
between this subparagraph, which refers to adjustments for insurance and for physical differences, and
the issue concerning Tubac's selection of pr oduct codes to include in its data base. 220 Mexico
responded that the discrepancies in the data on adjust ments for physical differences were so large that
Economía had no certainty either as to the adjust ments themselves or as to the selection of product
codes for normal value that were used to compar e with to the product codes exported to Mexico,
given that the purpose of adjustments for physical di fferences is to "standardize" the prices of similar
but non-identical products being compared, by neutralizing the differences between them.221
7.177 We find it surprising, in the light of Mexico's in sistence in its oral answers to Panel questions
during the second substantive meeting with the Panel that this issue was the central problem
encountered during Tubac's verification, that Mexico first raised it only at that late stage of this
dispute. Indeed, neither of Mexico's written submi ssions and neither of its prepared oral statements
(including at the second substantive meeting with th e Panel) makes any reference to this problem.
The first written reference to it before us app ears in Mexico's written responses to our written
questions raised in connection with the second me eting. (These written answers make the same
arguments as were made in Mexico's oral responses during the meeting.)
7.178 More importantly, we find no reference to this i ssue in the Final Determination. Indeed, the
only reference in the Determination to discrepan cies in the physical difference adjustments is a
sentence fragment, stating only that certain differe nces were found, contained in a subparagraph of
paragraph 80 that also covers insurance adjustments. There is no link in the Determination, in that
subparagraph or elsewhere, of the physical diffe rence adjustments issue with doubts about the

219 In our view, the Final Determination could be read to imply this, although Mexico's arguments
before us concerning Tubac's alleged fa ilure to act to the best of its ability are focused on issues other than the
product scope of Tubac's data.

220 Question 183 from the Panel.

221 Mexico's replies to questions 132 and 183 from the Panel.

selection of product codes included in the data base. Indeed, the only reference at all in the Final
Determination to any issue relating to product covera ge of the data base appears in subparagraph A of
paragraph (which has nothing to do with adjustment s for physical differences). Furthermore, as noted
above, (paragraph 7.152) Mexico has argued before us that the issue identified in subparagraph A was
not among the problems on which Economía based its decision to reject Tubac's data.
7.179 Nor do we see any reference to any problem re lating to product codes in the verification
report. That is, we find no factual support in the verification report for Mexico's implication before us
that Economía did not have full knowledge about the entire range of products produced by Tubac,
either about their physical characteristics or about their product codes, and thus had no basis on which
to judge whether Tubac had included all of the releva nt product codes in its data base. Indeed, as set
out in paragraphs 7.88-7.91, supra, the verification report indicates the contrary, starting with its
section entitled "Códigos de produc to" which begins on page 4.
222 We recall that this section states
that Tubac presented a detailed description of its product codes, including a table containing the
description and structure of each of those codes. The report then describes in detail the structure of
the product codes, indicating that the different digits in each 9-digit product code respectively identify
the product family, the presentation (shape, finish, and whether or not threaded), the calibre and
weight, the dimensions in inches, and the length, of the product. The report further states that Tubac
presented the verification team with a list of all of its product codes, covering all investigated and
non-investigated products. From this it appears that the verification team had, via the lists of product
codes provided, a complete physical description of all products produced by Tubac. Furthermore, we
recall that the verification report indicates that the issue of which of Tubac's product codes were and
were not covered by the investigation was extensively discussed at the verification, in connection with
the "Prueba de totalidad" and that the corresponding data were verified with no discrepancies found.
7.180 In addition, according to the record evidence, th e verification visit was not the first time that
Economía had received information from Tubac as to th e product codes of all of its products. To the
contrary, as indicated in the report on Economía's technical meeting with representatives of Hylsa
following the Preliminary Determination (i.e., befo re the verification visit to Tubac), Economía
informed Hylsa that it had received and studied the full list of Tubac's product codes, and had
concluded that "only 32 of them" corresponded to the investigated product. 223 Furthermore, the fact
that all of the data reported in Tubac's qu estionnaire response corres ponded to two technical
specifications, with well defined physical and di mensional parameters, would seem as a matter of
logic to limit the possibility that products with enormously different physical characteristics could
have been compared in the data base.
7.181 Nor do we see a necessary logical connecti on, as asserted by Mexico, of discrepancies
between accounting records and questionnaire respon ses for adjustments for physical differences, to
the physical similarity or dissimilarity of the products involved. For example, we can imagine a
situation where a questionnaire response did in f act identify and compare the most similar products,
but deliberately or inadvertently reported incorrect information as to the co sts associated with the
physical differences between those products. Th ese inaccuracies in the ad justments for physical
differences would have nothing to do with the selecti on of the similar products, or with the overall
scope of the data base, but instead would have to do with inaccuracies in the data reported.
7.182 In short, Mexico's argument before us on this point seems to be a post hoc explanation of
Economía's decision to reject Tubac's data, which neither appears in Economía 's Final Determination
nor finds factual support in the record evidence underl ying that Determination. In other words, we

222 GTM-15/MEX-12.

223 Exhibit GTM-11(B).

see no factual basis in the investigation or justif ication in the Determination for this argument by
Mexico.
7.183 As for the question of whether the record otherw ise contains any evidence that Tubac acted in
a deliberately misleading manner in terms of the da ta it provided in its questionnaire response, at
verification, or at any other point, we see none, a nd Mexico points to none. Indeed, given that
according to the verification report Tubac itself brought certain errors in its data base to the attention
of the verification team, and ot herwise is described in that report as providing all data and
documentation requested by the verification team wit hout delays or other problems, we consider that
an unbiased and objective investigating authority coul d not conclude on the basis of the verification
report that Tubac had failed to cooperate in the mann er asserted by Mexico As a result, we also find
no basis in the record for Mexico's assertion that Tubac significantly impeded the investigation.
7.184 For the foregoing reasons, we conclude that Economía acted incons istently Mexico's
obligations with paragraphs 3 and 5 of Annex II and thus Article 6.8 when it decided to reject in their
entirety the data that Tubac had submitted and to rely instead on facts available.
(v) Procedural aspects of Article 6.8 / Annex II claims
7.185 Guatemala also raises procedural claims related to Economía's resort to facts available. In
particular, Guatemala claims that Economía neve r informed Tubac that Economía had decided to
reject Tubac's data in their entirety, and neve r gave Tubac an opportunity to provide further
explanations, and that Mexico thereby violated pa ragraph 6 of Annex II. Mexico disagrees, arguing
that the verification report itself both constituted the required notification to Tubac as to the rejection
of its data, and provided the required opportunity for Tubac to present further explanations. The
questions before us in this claim thus are prim arily factual, namely whether Economía informed
Tubac that its data were being rejected, and wh ether Economía provided Tubac with the opportunity
to present further explanations. As Mexico's defenc e of this claim is based on the verification report,
we return to that document to see whether it supports Mexico's argument.
7.186 Starting with Economía's decision to reject T ubac's data, we recall that paragraph 6 of
Annex II requires that the party supplying informa tion that "is not accepted" by the investigating
authority must be "informed forthwith of the reasons therefore" and given "an opportunity to provide
further explanations within a reasonable period". The nature of this obligation is well settled 224, and
the parties to this dispute do not disagree in this regard. Rather, their disagreement centres on whether
– as a factual matter – Economía provided the requis ite notification and opportunity to submit further
explanations within the meaning of Annex II.
7.187 We note that Mexico argued before us that th e verification report constitutes only the factual
account of what happened at verification, and do es not constitute or contain any conclusions or
analysis or evaluation on the part of Economía. We asked Mexico to reconcile this argument with its
position that via the verification report Economía fulfilled the requirement in Annex II, paragraph 6 to
inform Tubac that its data were being rejected. Mexico replied that there was no contradiction
between these characterisations, because the verifica tion report indicated to Tubac the discrepancies
that were found at verification, and stated the possi bility that the Final Determination could be made
on the basis of facts available. Mexico stated in particular that "given the discrepancies in the
information submitted of which Tubac was aware, there is a sound basis for inferring that Tubac knew

224 See Panel Reports Argentina – Ceramic Tiles , e.g. at paragraph 6.21, and Egypt – Steel Rebar , e.g.
at paragraph 7.262.

about this situation"
225 of rejection of its data and reliance on f acts available. Mexico also stated that
"although the verification report did not contain a determination in the sense that facts available were
indeed to be used, it did include a clear warning that their use was a possibility".226 (emphasis added)
7.188 We do not find this argument convincing. To the contrary, we see the quoted statements as an
admission by Mexico that Economía never directly or explicitly informed Tubac that its data were
being rejected. Indeed, the "warning" that Mexico refers to is framed in general language that seems
to be standard for verification reports produced by Economía, given that the same language appears at
the end of Economía's report on the verification of Hylsa. 227 The language reads: "On the strength of
the results obtained in the course of resolving this matter and on the basis of the information in the
administrative file of the case, the Ministry may issu e final conclusions based on the facts available to
it". All that this language says is that final results may be based on facts available, not that a decision
has been taken in the particular case that they will be. We view paragraph 6 of Annex II to require
not a general statement of the possibility that facts av ailable could be used (which possibility in fact
exists in all anti-dumping investigations), but rather an affirmative and direct notification to the party
concerned that in the particular case a decision has b een made to reject its information, along with a
statement of the reasons for that decision. A dete rmination of this importance in an investigation
cannot be left to the party in question to infer from a document that Mexico itself characterizes as not
containing analysis or conclusions, but just facts. We thus find that Economía did not abide by the
requirements of paragraph 6 of Annex II to inform Tubac that it had decided to reject Tubac's data,
and to explain the reasons for that decision.
7.189 We next consider whether Economía gave Tubac an opportunity to provide further
explanations following Economía's decision to reject its data, as also required by paragraph 6 of
Annex II. Here again, Mexico refers to the verifi cation report – in particular to the five-day period
allowed in the verification report for any comment s on the report's contents – as constituting this
opportunity228, and argues that Tubac submitted no comments and otherwise took no corrective action
in respect of the problems that had been found at verification and described in the report. 229 Given, as
discussed in detail above, that the verification repor t did not inform Tubac that its information was
being rejected, and to the contrary indicated that essentially all of the problems encountered were
resolved on the spot at verification, we fail to see on what basis Tubac could have supposed that any
further corrective action was expected or required by Economía. Furthermore, and in any case, in the
light of our finding that the verification report doe s not satisfy the requirement in paragraph 6 of
Annex II to notify the interested party of the decision to reject its information and of the reasons

225 Mexico's answer to question 178 from the Panel. Mexico's second written submission, para. 123
and 125; Mexico's second oral communication, paras. 25, 26 and 31; Mexico's responses to questions 111 (a)
and (b) from the Panel.

226 Ibid.

227 Exhibit GTM-24, at page 14.

228 Mexico's answer to questions 11(b) and 182 from the Panel.

229 Mexico argues in its second written submission (at paragraph 110) that "[I]f Tubac, although well
aware that there were differences between the data it ha d submitted to the investigating authority and the data
obtained during the on-site investigation, did nothing to clarify at all the information, it is logical that the
investigating authority should proceed" by rejecting the information. Mexico further argues in the same
submission (at paragraph 125) that "... as the report of th e verification visit shows, these problems were pointed
out to Tubac's representatives, and it was the exporters that took no remedial action to bring the information into
conformity with the purpose of its being used by the investigating authority".

therefor, that report by definition also could not satis fy the requirement to provide the interested party
an opportunity to submit further explanations following the decision.
7.190 On the basis of the foregoing considerations, we find that Economía acted inconsistently with
paragraph 6 of Annex II, and thus Article 6.8, by failing to inform Tubac that its data were being
rejected and of the reasons for that decision, and by failing to provide Tubac with an opportunity to
submit further explanations.
(vi) Annex II, paragraph 7 – "special circumspecti on" regarding information used as facts
available
7.191 Guatemala claims that Economía did not use special circumspection when deciding to base
the dumping determination, in particular as to nor mal value, on the information provided in the
application. According to Guatemala, the problems that made this information an insufficient basis
for initiation, which were not rec tified or addressed at the final phase, made this information even
more inadequate as the basis for the final determination of dumping.
7.192 Mexico argues that the information in the petition constituted an adequate and reliable basis
for determining normal value, given that Economía had evaluated its accuracy and adequacy at the
time of initiation. In this context, concerning th e data on imports that were used as the basis for
export prices in the Final Determination, Mexico asserts that these data were taken from the import
"pedimentos" obtained from importers and thus were fully accurate and comprehensive. Mexico also
argues in general that once Economía determined th at it would rely on facts available, it "sought to
corroborate the information with other independent sources, such as the SICMEX import statistics, the
information provided by customs agents, and the in formation obtained from other interested parties
during the investigation".
230 Mexico further argues that Tubac fa iled to cooperate in the sense of the
last sentence of paragraph 7 of Annex II, providi ng more justification for Economía's use of the
information contained in the application as facts available.
7.193 We recall our findings, supra, that Economía acted inconsistent ly with Article 5.3 and thus
Article 5.8 by initiating the investigation on the basis of evidence pertaining to normal value (i.e., the
invoice and the price quote) that was insufficient due to a number of specific shortcomings which in
our view are obvious on the face of that evidence. We see no factual basis in the record, and Mexico
points to none, in support of its argument that befo re using that same normal value information as the
basis for the final dumping determination, Economía took any steps to verify its accuracy. Nor do we
see any evidence, and Mexico points to none, that Economía sought to ascertain the
representativeness of that information in respect of the products and period covered by the
investigation, or to adjust it in any way to addr ess the problems that we identified in the context of
Guatemala's claims related to the initiation. To th e contrary, the Final Determination makes clear that
the information as submitted by Hy lsa was accepted and used essentia lly "as is" by Economía as the
basis for normal value in the final dumping calcul ations – the invoice for all galvanized products
within the scope of the investigation and the pr ice quote for all black products within that scope. 231 In

230 Mexico's response to question 182 from the Panel.

231 In particular, paragraph 109 of the Final Determination describes the invoice, and indicates that
Economía converted the prices reflected therein from quetzales using the Bank of Guatemala's published
exchange rate for the date of the invoice. Paragraph 11 0 describes the price quote, and indicates that Economía
converted the prices from quetzales on the same basi s. Paragraph 111 indicates that Hylsa provided the
methodology and factors for converting the per piece pric es in the invoice and price quote to a per kilogram
basis. Paragraph 112 stat es that Economía "accepted the informati on supplied by the applicant, in accordance
with Article 5.2 of the Anti-Dumping Agreement and Section XI of the FTA Regulations". Paragraph 114, the
sole paragraph appearing under the heading "Ajustes al valor normal", indicates th at Economía adjusted the
prices in the invoice for credit, for the period specified in the invoice, on the basis of a methodology provided by

other words, the Final Determination makes clear th at the normal value information used for the final
dumping determination was identical to that used for initiation, and thus included, unaddressed, all of
the flaws and shortcomings that rendered that information insufficient for purposes of initiation.
7.194 Of particular relevance in this regard is th e very narrow product coverage of the invoice and
price quote compared with the overall product scope of the investigation. Not only was this problem
still present and unaddressed by Economía at the time of the Final Determination, but in fact it had
become more pronounced given the expansion of th e product scope to include certain structural
tubing as well as products in the 4"-6" size range. Th at is, because of the expansion of the product
scope, the invoice and price quote represented an even narrower subset of the total covered products
at the final phase of the investigation than had been the case at the time of initiation. Yet, as
discussed above, there is no evidence that Econom ía took any steps at the time of the Final
Determination to ascertain whether the pricing info rmation contained in those two documents could
be viewed as representative inter alia of Guatemalan prices for the broader product range covered by
the investigation at that point, including the added products.
232
7.195 Here, we recall our agreement with the prin ciple asserted by Mexico (in defence of
Economía's reliance on the invoice and price quote at the initiation stage) that the standard of
evidence for initiation is lower than that for a preliminary or final determination233 (although, as noted
above234, we disagree with Mexico that a "mere indication" of alleged dumping is sufficient at the
initiation stage). We view this defence by Mexico in the context of Guatemala's initiation claim as an
implicit acknowledgement that the invoice and price quote would not have been a sufficient basis for
a final determination, and we do not see how, given the absence of any eviden ce in the record that
Economía took any steps to ascertain the accuracy and representativeness of these documents at the
final stage of the investigation, this argument can be reconciled with Mexico's apparent position in the
context of the Final Determination that the invoice and price quote were sufficient "as is".
7.196 We further note Mexico's argument that "the l ast sentence of paragraph 7 of Annex II of the
AD Agreement says 'It is clear, however, that if an interested party does not cooperate and thus
relevant information is being withheld from the aut horities, this situation could lead to a result which
is less favourable to the party than if the party did cooperate', which is exactly the way the
investigating authority proceeded (emphasis added). In our view, Mexico's reliance on the argument
that Tubac "failed to cooperate" in the sense of para graph 7 of Annex II and that the last sentence of

Hylsa. Thus, the Final Determination is clear that the normal value evidence used by Economía was that
provided in for purposes of initiation (i.e., the invoice and price quote), and that the only adjustment of any kind
was the same adjustment to the invoice prices for credit that was made at the time of initiation. There is no
reference to any other adjustment or verification process undertaken by Economía in respect of this evidence
before it was used in the final dumping calculations. Finally, we note that the above description in the Final
Determination of this evidence and the sole adjustment th ereto (the credit adjustment to the invoice) is virtually
identical to the corresponding drafting in the Initiation Determination (see Exhibit GTM-4 at paragraphs 61-67).
We view this fact as further confirmation that the normal value information used for the final determination of
dumping was identical to that used for purposes of initiation.

232 We note here that Mexico has argued before us that Economía found these products to be
"competitive" and in some cases substitutable. While this may have been the case (an issue that is not in any
case before us), the competitiveness or substitutability of a given product with another is not informative as to
their relative or absolute prices.

233 See paragraph 7.22, supra, and e.g., first written submission of Mexico at paragraph 33: "[Since]
the evidence submitted with the application does not have to be of the quality and quantity needed to support a
determination of unfair practice and the application of an anti-dumping duty, but to initiate an investigation, the
information in the application need be no more than a mere indication of ‘alleged dumping’."

234 See paragraph 7.22, supra.

that provision therefore justified Economía in relying on the normal value information from the
application constitutes an acknowledgement by Mexico that Economía used that information for the
purpose of arriving at a "less favourable" result for Tubac than otherwise would have been the case235,
and that it did not evaluate that information on its own merits for representativeness and sufficiency.
7.197 On the basis of the foregoing considerations, we find that Economía failed to use "special
circumspection" in relying on th is unadjusted evidence for its Fi nal Determination, as required by
paragraph 7 of Annex II. Here we agr ee with the observation of the panel in Egypt – Rebar that the
provisions of Annex II have to do with ensuring the reliability of the information used by the
investigating authority. 236 Furthermore, as discussed in the preceding section, we do not see any
evidence in the record to support Mexico's ar gument that Tubac failed to cooperate in the
investigation and thereby significantly impeded the investigation as asserted by Mexico. Thus, even
if arguendo (as Mexico implies but which, as noted, is not an issue raised in this dispute) the last
sentence of paragraph 7 permits a de liberate use of so-called "adverse facts available" in the case of
non-cooperation by an interested party, that sentence would not apply to the factual situation at hand
and thus is not relevant to the case before us. On the basis of these considerations, we find that
Economía acted inconsistently with paragraph 7 of Annex II and Article 6.8 because in applying as
facts available the normal value evidence that was pr ovided by the applicant and used in Economía's
initiation decision it failed to use "special circumspection".
(vii) Other claims pursuant to Article 6

7.198 Guatemala claims that Economía's rejection of Tubac's data and resort to facts available also
violated Articles 6.2, 6.4, 6.7, 6.9, and 6.13. Regarding Articles 6.2 and 6.4, Guatemala argues that
by deciding only at the very end of the investigation to resort to facts available, Economía denied
Tubac the opportunity to see all of the relevant info rmation, to prepare presentations thereon, and thus
to fully defend its interests. Regarding Article 6.7, Guatemala argues that the verification report does
not correspond with the description of the verification results that appears in the Final Determination,
and that the Mexico points to no other document of record referring to the a lleged flaws uncovered at
verification, and that therefore Economía did not co mply with its obligation to inform Tubac of the
results of the verification.
237 Regarding Article 6.9, Guatemala argues that Economía did not disclose
the essential fact of the resort to facts available prior to making its Final De termination. Regarding
Article 6.13, Guatemala argues that Economía did not take due account of difficulties experienced by
Tubac in supplying the requested information.
7.199 Mexico argues that Guatemala has not established a violation of any of these provisions.
Regarding Articles 6.2 and 6.4, Mexico argues that Tubac had full opportunity to present information
and argument in respect of the inclusion of certain structural tubing within the product scope.
Regarding Article 6.7, Mexico argue s that the requirement is to disclose the factual results of the
verification, not the analysis of those facts. Rega rding Article 6.9, Mexico argues that the decision to
resort to facts available is not an "essential fact " subject to the disclosure requirement of that

235 In the context of the last sentence of paragraph 7, prior panels and the Appellate Body have used the
term "adverse facts available" to describe the situation where an investigating authority applies facts available in
such as way as deliberately to give rise to a "less fa vourable" outcome for a non-cooperating party than would
have been the case had that party cooperated. We emphasize here that Guatemala has not raised, and we thus do
not express any view as to, the issue of whether the final sentence of paragraph 7 of Annex II permits such
deliberate use of "adverse facts available" where a party has failed to cooperate with an investigating authority.

236 Panel Report on Egypt – Steel Rebar, at paragraph 7.154.

237 Guatemala also argues that its Article 6.7 claim is subsidiary to its Article 6.8 claim, such that the
Panel would only need to reach it in the event it found no violation of Article 6.8. (Response of Guatemala to
question 103 from the Panel, at para. 110.)

provision. Regarding Article 6.13, Mexico does not elaborate a specific argument, but instead relies
on its rebuttal to the Article 6.8 claim.
7.200 The arguments of the third parties related to this issue are su mmarized at paragraph 7.110,
supra.
7.201 We see Guatemala's additional Article 6 claims that relate to facts available as covering
essentially the same substantive i ssues as are covered by Guatemala's claims under Article 6.8 and
Annex II. In the light of our findings that Econom ía acted inconsistently with both substantive and
procedural requirements of Article 6.8 and Annex II in deciding to reject Tubac's information and
resort to facts available, we see no need to reach these additional facts available claims under
Article 6, and thus make no findings thereon.
2. Claims pursuant to Article 2
7.202 Guatemala raises other claims relating to the determination of dumping, alleging in particular
that Mexico violated Articles 2.1, 2.4 and 2.6 as a result of expanding the scope of the investigation to
include products in the 4"-6" diameter range, and to include certain structural tubing. In particular,
Guatemala argues in respect of Article 2.1 that Economía did not obtain information on these added
products, and did not calculate dumping margins for th em, so that it did not establish the existence of
dumping in respect of the "product as a whole" as required by Article 2.1. Concerning Article 2.4,
Guatemala argues that this provision requires a "f air comparison" between normal value and export
price for the investigated product, and that it is not possible to realize such a fair comparison without
pricing information for all of the products cove red by the investigation. Thus, according to
Guatemala, this claim is closely related to its Ar ticle 2.1 claim. Regarding Article 2.6, Guatemala
argues that Economía acted inconsistently with this provision by defining the investigated product and
the like product at initiation, and then failing to maintain these definitions over the course of the
investigation. Guatemala notes that while Article 2.6 does not prohibit changes to the definitions of
the investigated product or the like product, in this case Mexico changed the definitions without
positive evidence and without an impartial and objective examination of the facts.
7.203 Mexico responds that none of these claims ha s merit. According to Mexico, all of the
products included in the scope of the investigati on as of the Final Determin ation constituted a single
investigated product, and therefore the investigatio n was comprehensive in respect of that product,
and the comparisons made were fair. Mexico also notes that Guatemala acknowledges that Article 2.6
does not prohibit changes to the scope of the inv estigated product or the like product, and further
argues that the Anti-Dumping Agreement contains no rules on the establishment or definition of the
investigated product. Thus, Mexico maintains, Ec onomía was in full compliance with its obligations
under the Agreement in respect of the scope of the investigated product over the course of the
investigation.
7.204 The arguments of the third parties related to this issue are summarized at paragraphs 7.336-
7.338, infra.
7.205 All of these claims have as their factual basis the two expansions to the scope of the
investigated product. We have found, above, that in deciding to reject Tubac's data and resort to facts
available, and in its selection of the normal valu e information to use as facts available, Economía
acted inconsistently with Annex II and Article 6.8. We recall that these findings are related in part to
the expansions of the scope of the investigated product during the course of the investigation.
Furthermore, and in any case, as a result of these findings, Economía's final determination of dumping
as a whole – in respect of the entire expande d product scope – was inconsistent with the Anti-
Dumping Agreement. On this basis we do not consider it necessary to, and thus do not, make findings
on these remaining claims pertaining to Economía's final determination of dumping.

E. CLAIMS RELATING TO DETERMINATION OF INJURY AND CAUSAL LINK
1. "Objective examination" of "positive evidence" in injury determinations
7.206 Guatemala makes a number of claims relating to the Mexican investigating authority's injury
analysis. These claims are based on certain common principles in Article 3 of the Anti-Dumping
Agreement, which deals with the determination of injury caused to the "domestic industry" (as defined
by Article 4.1) producing the "like product" (defined in Article 2.6). Therefore, before examining
each of these claims individually, we recall th e relevant legal provisions and general guiding
principles involved.
7.207 Article 3 of the Anti-Dumping Agreement is entitled "Determination of Injury". Article 3 as a
whole deals with obligations of Members with respect to the determination of injury and causal link.
"Injury" means "material injury to a domestic indus try, threat of material injury to a domestic
industry or material retardation of the establishment of such an industry ".238 The focus of an injury
determination is the state of the "domestic indus try"; the causation analysis focuses on the causal link
between dumping and any injury to the "domestic industry".
7.208 The term "domestic industry" is defined in Ar ticle 4.1. Article 4 is entitled "Definition of
domestic industry". Article 4.1 reads, in part:
"For the purposes of this Agreement, the term "domestic industry" shall be interpreted
as referring to the domestic producers as a whole of the like products or to those of
them whose collective output of the products constitutes a major proportion of the
total domestic production of those products ..."
7.209 The concept of "like product" is therefore also at the root of the notion of "domestic industry".
Article 2.6 of the Anti-Dumping Agreement states:
"Throughout this Agreement the term "like product" ("produit similaire") shall be
interpreted to mean a product which is iden tical, i.e. alike in all respects to the
product under consideration, or in the absence of such a product, another product
which, although not alike in all respects, has characteristics closely resembling those
of the product under consideration."
7.210 This provision defines the scope of the "like pr oduct" in relation to the scope of the "product
under consideration". However, the Agreement contains no further explicit guidance in relation to the
delineation of the "product under consideration".
7.211 Article 3.1 is an overarching provision that sets forth a Member's fundamental, substantive
obligation in respect of the determination of injury and causation. Article 3.1 provides:
"A determination of injury for purposes of Article VI of GATT 1994 shall be based
on positive evidence and involve an objective examination of both (a) the volume of
the dumped imports and the effect of the dumped imports on prices in the domestic
market for like products, and (b) the consequent impact of these imports on domestic
producers of such products."
7.212 This provision requires, among other things, that the injury determination be based on an
"objective examination" of "positive evidence".

238Footnote 9 to the Anti-Dumping Agreement.

7.213 We consider that "positive evidence" is evidence th at is relevant and pertinent with respect to
the issue to be decided, and that has the characteristics of being inherently reliable and creditworthy.
Under the positive evidence criterion of Article 3.1, the question whether the information at issue
constitutes "positive evidence" — i.e., is relevant, pertinent, reliable, and creditworthy —is assessed
with respect to the particular issue at stake and the particular circumstances of a given case.
239
7.214 While the term "positive evidence" focuses on the facts underpinning and justifying the injury
determination, the term "objective examination" is concerned with the investigative process itself. An
"objective examination" requires that the domestic industry, and the effects of dumped imports, be
investigated in an unbiased manner, without favouring the interests of any interested party, or group
of interested parties, in the investigation. Th e duty of the investigating authorities to conduct an
"objective examination" recognizes that the determination will be influenced by the objectivity, or any
lack thereof, of the investigative process. Therefore, the identification, investigation and evaluation of
the relevant factors must be "even-handed".240
7.215 The overarching obligation in Article 3.1 – that the determination of injury to the domestic
industry be based on an "objective examination" of "positive evidence" – informs the more detailed
obligations in succeeding paragraphs. For the pur poses of this dispute, these relevant obligations
concern the consideration of the volume of dumped imports, and their effect on prices (Article 3.2),
the impact of dumped imports on the domestic indus try (Article 3.4) and the causal link between
dumped imports and injury (Article 3.5). These provisions read:
"3.2 With regard to the volume of the dumped imports, the investigating
authorities shall consider whether there h as been a significant increase in dumped
imports, either in absolute terms or re lative to production or consumption in the
importing Member. With regard to the effect of the dumped imports on prices, the
investigating authorities shall consider wh ether there has been a significant price
undercutting by the dumped imports as compar ed with the price of a like product of
the importing Member, or whether the effect of such imports is otherwise to depress
prices to a significant degree or prevent price increases, which otherwise would have
occurred, to a significant degree. No one or several of these factors can necessarily
give decisive guidance. [...]
3.4 The examination of the impact of the dumped imports on the domestic
industry concerned shall include an evalua tion of all relevant economic factors and
indices having a bearing on the state of the industry, including actual and potential
decline in sales, profits, output, market shar e, productivity, return on investments, or
utilization of capacity; factors affecting domestic prices; the magnitude of the
margin of dumping; actual and potential negative effects on cash flow, inventories,
employment, wages, growth, ability to raise capital or investments. This list is not
exhaustive, nor can one or several of these factors necessarily give decisive guidance.
3.5 It must be demonstrated that the du mped imports are, through the effects of
dumping, as set forth in paragraphs 2 and 4, causing injury within the meaning of this
Agreement. The demonstration of a causal relationship between the dumped imports

239 Appellate Body Report, Mexico – Anti-Dumping Measures on Rice, paras. 164 and 165, upholding
Panel Report, Mexico – Anti-Dumping Measures on Rice, paras. 7.55 and 7.61. See also Appellate Body
Report, US – Hot-Rolled Steel, para. 192.

240 Appellate Body Report, US – Hot-Rolled Steel, para. 196. WTO panels are under a similar duty,
under Article 11 of the DSU, to make an "objective assessment of the matter … including an objective assessment
of the facts". The obligation to make an "objective a ssessment" includes an obligation to act in "good faith",
respecting "fundamental fairness". We find support in Appellate Body Report, EC- Hormones, para. 133.

and the injury to the domestic industry shall be based on an examination of all
relevant evidence before the authorities. The authorities shall also examine any
known factors other than the dumped imports which at the same time are injuring the
domestic industry, and the injuries caused by these other factors must not be
attributed to the dumped imports. Factors which may be relevant in this respect
include, inter alia , the volume and prices of imports not sold at dumping prices,
contraction in demand or changes in the pa tterns of consumption, trade restrictive
practices of and competition between the foreign and domestic producers,
developments in technology and the export performance and productivity of the
domestic industry."
7.216 Against this backdrop, we address Guatemala's claims relating to the Mexican investigating
authority's injury and causation analyses below.
2. Time gap between the end of the period of investigation and the initiation of
investigation
(a) Arguments of the parties
(i) Guatemala
7.217 Guatemala asserts that Mexico violated Articles 3.1, 3.2, 3.4 and 3.5 of the Anti-Dumping
Agreement by relying on a period of investigation th at ended significantly (eight months) before the
initiation of the investigation (and two years prior to the imposition of duties) and therefore failed to
take into account relevant data relating to the period immediately preceding the investigation.
According to Guatemala, the determination of inju ry and causal link was therefore not based on an
objective examination of positive evidence.
(ii) Mexico
7.218 Mexico argues that Guatemala's allegations are without foundation and fail to establish a
prima facie case, and that the injury/causation dete rmination complied with Articles 3.1, 3.2, 3.4
and 3.5 of the Anti-Dumping Agreement. Mexico asserts that the Anti-Dumping Agreement does not
contain any specific and express rules relating to the in jury investigation period, and that the period of
eight months between the end of the investiga tion period and the initiation was reasonable and as
close as possible to the date of initiation.
(b) Arguments of the third parties
7.219 The European Communities endorses Guatemala's analysis of considerations relevant to the
Panel's examination. According to the Europ ean Communities, data from a recent POI are more
likely to yield relevant positive evidence, and Mexico's arguments are of questionable merit.
7.220 Japan takes no position on the factual aspects of this case, but asserts that an eight-month
period from the initiation of the investigation may raise doubts about the pertinence of the information
gathered to the existence of current injury, questioning the merits of Mexico's arguments.
7.221 The United States asserts that the use of a "stale" POI is inconsistent with Articles 3.1, 3.2,
3.4 and 3.5 of the Anti-Dumping Agreement, and questions the merits of Mexico's arguments in light
of the circumstances of this case.

(c) Evaluation by the Panel
(i) Factual background
7.222 We first recall the undisputed facts on the record. Economía examined data for a period of
investigation covering July through December 2000 for purposes of its dumping determination, and
July through December 1998, 1999 and 2000 for purposes of its injury analysis. Economía adopted
the injury POI propo sed by the applicant.
241 The application was filed on 22 May 2001. Economía
sought clarifications from the applicant on 11 J une 2001, and the applicant submitted responses on
9 July 2001. The investigation was initiated on 24 August 2001, about eight months after the end of
the period of investigation. Final anti-dumpi ng measures were imposed pursuant to the Final
Determination published on 13 January 2003, just over two year s after the end of the period of
investigation.
(ii) Analysis
7.223 We see the main issue before us as whether, in this case, in using data from an investigation
period that ended about eight months prior to the da te of initiation of the investigation (and about two
years prior to the imposition of the final anti-dumping measure), the Mexican investigating authority
breached the requirement in Article 3.1 to conduct an "objective assessment" of "positive evidence".
As outlined above, because Article 3.1 sets out an overarching principle that informs the injury
obligations in the rest of Article 3, our views on th is issue will also resolve Guatemala's claims here
under Articles 3.2, 3.4 and 3.5 of the Anti dumping Agreement.
7.224 We begin by underlining that the selection by an investigating authority of the period of
investigation is clearly a critical element in the anti-dumping investigative process: it determines the
data that will form the basis for the assessment of dumping, injury and the causal relationship between
dumped imports and the injury to the domestic industry.242
7.225 We agree with Mexico 243 to the extent it argues that the Anti-Dumping Agreement does not
contain any specific and express rules concerning the peri od to be used for injury data collection in an
anti-dumping investigation.244,245 However, as also acknowledged by Mexico, this does not mean that

241 The notice of initiation, Exhibit GTM-4, para. 90, indicates that the applicant, "proposed the period
from July to December 2000 as the period to be investigated because during that time imports of standard pipe
from Guatemala were carried out in conditions of price di scrimination, which was reflected in a deterioration of
its production plant, commercial activity and financial operations. The Ministry determined the period
July-September 2000, which meets the requirements laid down in the law, as the period to be investigated". See
also Exhibit GTM-23, para. 152.

242 We find support for our view in the Panel Report in Mexico – Anti-Dumping Measures on Rice ,
para. 7.56. The Appellate Body upheld the Panel's finding on this issue. See Appellate Body Report, para. 172.

243 See e.g. Mexico's response to question 23 from the Panel.

244 We recall and endorse the view of the Egypt - Rebar panel, paras. 7.130-7.131, that neither
Article 3.1 nor 3.5 nor any other provision of the Anti-Dumping Agreement, "contains any specific rules as to
the time periods to be covered by the injury or dumping investigations, or any overlap of those time periods."
That panel further observed, : ".... the only provisions that provide guidance as to how the price effects and
effects on the domestic industry if the dumped imports are to be gauged are (as cross-referenced in Article 3.5),
Articles 3.2 (volume and price effects of dumped imports), and Article 3.4 (impact of the dumped imports on the
domestic industry). Neither of these provisions specifies particular time periods for these analyses ..."

245 We recall that footnote 4 to Article 2.2.1 of the Anti-Dumping Agreement, associated with the term
"extended period of time" in the context of determining whether certain sales may properly form the basis for a

the authority enjoys unlimited discretion to use an y period of investigation in reaching its injury
determination.
7.226 We consider that Article VI of the GATT 1994 and the relevant provisions of the Anti-
Dumping Agreement offer textual and contextual evidence for the proposition that a Member may
impose an anti-dumping measure only if it makes a reasoned determination that dumped imports are
currently causing injury. In this respect, Article VI.2 of the GATT 1994246 provides that:
"In order to offset or prevent dumping, a contracting party may levy on any dumped
product an anti-dumping duty not greater in amount than the margin of dumping in
respect of such product".
Article 11 of the Anti-Dumping Agreement similarly provides that:
"An anti-dumping duty shall remain in force only as long as and to the extent
necessary to counteract dumping which is causing injury".
In addition, Article 3.2 addresses the volume a nd price effects of the dumped imports.
Article 3.4 requires an examination of the impa ct of the dumped imports upon the state of the
domestic industry. Article 3.5 of the Anti-Dumping Agreement provides:
"It must be demonstrated that the dumped imports are, through the effects of
dumping, as set forth in paragraphs 2 and 4, causing injury within the meaning of this
Agreement.
[...]". (emphasis added)247
7.227 These provisions – with such terms as "offset" and "counteract" and the requirement of a
current causal link – furnish clear textual indicati ons that anti-dumping measures may be imposed
only to offset dumping currently causing injury. We agree with th e approach of previous panels in
discerning an inherent real-time link between the i nvestigation leading to the imposition of measures
and the data on which the investigation is based. This link connects the imposition of the measure and
the conditions for application of the measure: dumping (currently) causing injury.248
7.228 It is well established that the data on the basis of which this determin ation is made may be
based on a past period, known as the period of inves tigation. Nevertheless, because this "historical"
data is being used to draw conclusions about the cu rrent situation, it follows that the more recent data

normal value in a dumping calculation, provides: "The extended period of time should normally be one year but
shall in no case be less than six months."

246 The term "offset" suggests that the scheme established in Article VI of the GATT 1994, and applied
through the provisions of the Anti-Dumping Agreement, fulfils a corrective function: Members are permitted
to take corrective measures in order to counter the injurious situation created by dumping. Under the logic of
this corrective scheme, the imposition of anti-dumping duties is justified to the extent that they respond to injury
caused by dumping. See, for example, Panel and Appellate Body Report in Mexico – Anti-Dumping Measures
on Rice, paras. 7.58 and 165, respectively.

247 We are aware that the Spanish text of the Agreem ent reads: "Habrá de demostrarse que, por los
en el sentido del presente Acuerdo". The use of the present tense of the verb in the Spanish text confirms to us
the necessity that the Agreement envi sages that measures may be imposed only where dumped imports cause
current injury.

248 We find support for our views in Panel and Appellate Body Reports, Mexico – Anti-Dumping
Measures on Rice, paras. 7.56 – 7.61 and 165, respectively.

is likely to be inherently more relevant and thus especially importa nt to the investigation. This
implies, consequently, that the data considered concerning dumping, injury and the causal link should
include, to the extent practicable, the most recent possible information, taking into account the
inevitable delay caused by the need for an investigation, as well as any practical problems of data
collection in a particular case. We find further, contextual, support for our views in the Anti-Dumping
Agreement.
249 We also note that past panels and the A ppellate Body have underlined the importance
for POI data to relate to the recent past, so as to establish the existence of injury caused by dumped
imports (as far as practicably possible).250
7.229 Moreover, we note that the Committee on Anti-Dumping Practices adopted a
Recommendation concerning the Periods of Data Collection for Anti-Dumping Investigations
(G/ADP/6, adopted 5 May 2000) which sets forth gui delines for determining what period or periods
of data collection may be appropriate for th e examination of dumping and of injury. The
Recommendation stipulates inter alia that the period of data collection should end as close to the
initiation of the investigation as is practicable. 251 This Recommendation is a non-binding guide to the
common understanding of Members on a ppropriate implementation of the Anti-Dumping Agreement,
and does not add new obligations, nor detract from the existing obligations, of Members under the

249 For example, in Article 14.2 of the Anti-Dumping Agreement dealing with anti-dumping actions on
behalf of a third country. Article 14.2 provides as follows:
"14.2 Such an application [for an anti-dumping action on behalf of a third country] shall be
supported by price information to show that the imports are being dumped and by detailed
information to show that the alleged dumping is causing injury to the domestic industry
concerned in the third country. The government of the third country shall afford all assistance
to the authorities of the importing country to obtain any further information which the latter
may require" (emphasis added).
If such is the case in respect of applications for third country anti-dumping actions, it seems reasonable
to conclude that a similar temporal requirement exists when the anti-dumping proceedings relate to injury being
caused to a Member's own domestic industry.

250 For example, Panel Report, EC - Tube or Pipe Fittings , para. 7.101 (addressing the dumping POI):
"The period of investigation terminates as close as possible to the date of initiation of the investigation in order
to ensure that the data pertaining to the investigation period, while histor ical, nevertheless refers to the recent
past ..." (the Appellate Body upheld the Panel's findings on this issue – see Appellate Body Report, EC - Tube
or Pipe Fittings, para. 84); Panel Report, US - Hot-Rolled Steel, para. 7.234: "In our view, a proper evaluation
of the impact of dumped imports on the domestic industry is dynamic in nature and takes account of changes in
the market that determine the current state of the industry." Further contextual support can be found in the
Agreement on Safeguards , and Article 2.1 of the Agreement on Safeguards in particular. See, for example,
Appellate Body Report, Argentina – Footwear (EC), footnote 130; Panel Report, US - Lamb, para. 7.192.

251 Recommendation Concerning the Periods of Data Collection for Anti-Dumping Investigations
(G/ADP/6, adopted 5 May 2000) provides in relevant part that:
"the Committee recommends that with respect to original investigations to determine the
existence of dumping and consequent injury -
1. As a general rule:
(a) the period of data collection for dumping investigations normally should be twelve
months, and in any case no less than six months, ending as close to the date of initiation as is
practicable;" (footnote omitted) ...
(c) the period of data collection for injury investigations normally should be at least
three years, unless a party from whom data is being gathered has existed for a lesser period,
and should include the entirety of the period of data collection for the dumping investigation;
...".

Agreement.252 We nevertheless observe that it by no mean s runs counter to our interpretation of the
obligations found in the text of the Anti-Dumping Agreement.253
7.230 There are, of course, potential difficulties with the reliability and probative value of data
relating to the period after initiation, because those data may be a ffected by the very existence of the
investigation. However, we consider that the i nvestigating authority should rely upon information
pertaining to a period approaching, as close as practicab le, the date of initiation of the investigation.
This is particularly important because the Agreemen t envisages that an investigation may last 12 - or,
in special circumstances 18 - months. 254 Even in an optimal scenario where the POI ends the day
before the date of initiation, the data from whic h conclusions would be drawn relating to current
dumping causing injury will be at least 12 (and in special circumstances, 18) months old.
7.231 As we have stated, in the case at hand, duties were imposed pursuant to an initiation
approximately eight months after, and a final resolution issued approximately 24 months after, the end
of the period of investigation, on the basis of an investigation that lasted 17 months.
7.232 Given these considerations, we evaluate whether, in this case, this gap of eight months
between the end of the period of investigation and the initiation of the investigation, and another gap
of just over two years between the end of the peri od of investigation and th e imposition of the final
anti-dumping duties raises such doubts about the exis tence of a sufficiently relevant nexus between
the data relating to the pe riod of investigation and current injury and causal link as to result in a
violation of Article 3.1 (and Artic les 3.2, 3.4 and 3.5) of the Anti-Dumping Agreement. To resolve
this issue, we focus on the issue of "remoteness" of the investigation period from the date of initiation,
given that the instant investigation took place wi thin the overall time-frames envisaged by the
Agreement (and Guatemala does not assert otherwise).255
7.233 Mexico insists that the end of the period of investigation was the closest it could possibly
have been to the initiation, taking into account, inter alia , that this was five months prior to the
submission of the application. Moreover, Mexico points out that, during the three-month period
between the submission of the application (on 22 May 2001) and the issuance of the Initiation
Determination (on 24 August 2001), the investigating authority took steps to assess the information in
the application and to require the submission of supplementary information.
256 Economía issued a

253 Past panels have similarly referred to this Recommendation in their reasoning. See e.g. Panel
Report, Guatemala – Cement II, para. 8.266; Panel Report, US – Hot-Rolled Steel, footnote 152; Panel Report,
Argentina – Poultry Anti-Dumping Duties, para. 7.287.

254 Article 5.10 provides: "Investigations shall, exce pt in special circumstances, be concluded within
one year, and in no case more than 18 months, after their initiation."

255 We recall Mexico's argument that it is not possi ble to challenge the selection of a POI in the
abstract, because it is necess ary to consider the nature and relevance of the data actually gathered during the
POI. We note that we are considering the data actua lly on the record of the underlying investigation in our
evaluation of this claim. In respect of Mexico's contention that changes in circumstance which may occur at late
stages of a POI may be the subject of subsequent reviews under Articles 9 and 11, we would simply point out
that this case does not involve changes occurring late in the POI, nor can the availability of reviews substitute
for compliance with obligations governing the initiation and conduct of the investigation.

256 Exhibit GTM-2, e.g. some questions like 5 and 7 ask about developments during the three six-month
periods July-December 1998, 1999 and 2000. As the Mexican investigating authority did not ask any questions
directed at assessing the validity of th e POI proposed by the applicant, we consider that Economía had already
accepted the POI at that point.

"prevención" and assessed the evid ence in the application during a period over and above the time
required to arrange publication of the notice in the Of ficial Register. In response to questioning as to
whether any practical problems necessitated this par ticular period of investigation; whether it was
established that updating the information was not po ssible; and whether any attempt was made to
update the information, Mexico confirmed that, as Economía deemed that the POI was appropriate
and that the information before it was adequate in order to complete its investigation, Economía made
no attempt to update the information, did not requ est more recent information and therefore did not
experience any practical problems in updating the information.
257
7.234 We consider that it would have been appropr iate and desirable for Economía to collect
updated data, if not prior to initiation, then at least for the purposes of its substantive injury
analysis.258 However, we observe that there are practical time constraints in respect of the production,
gathering and analysis of data. Particularly in light of the time required for data of the type included
in this anti-dumping application to be produced and published, and then collected and analysed by the
applicant in order to rely upon it in its appli cation, it was not unreasonable for the investigating
authority to rely on a data set terminating eight months prior to the initiation of the investigation.
7.235 In this case, furthermore, the investigation o ccurred within the overall time frame envisaged
by the Agreement. That is, the investigation fe ll within the time window – i.e. except in special
circumstances, 12 months, and in no case more than 18 months – envisaged by Article 5.10 of the
Agreement. In any event, Guat emala has made no allegation that the provisions of Article 5.10 are
not satisfied. We do not consider that Guatemal a has established that the information used by
Economía did not reflect a sufficiently relevant ne xus between the data relating to the period of
investigation and current injury and causal link, and thus did not give reliable indications of current
injury. Given that the Anti-Dumping Agreement does not contain any specific and express rules
concerning the period to be used for injury data collection in an anti-dumping investigation, and on
the basis of the facts and arguments before us, we do not consider that the period used in this case was
remote.
7.236 This is not to say that we are fully satisfied with Economía's selection of the injury POI, and
we believe it is instructive to set out our remaini ng concerns in some detail. We note that Economía
adopted the period of investigation proposed by the a pplicant. It is clear to us that acceptance of the
POI proposed by the applicant may not necessarily c onstitute a violation of Article 3.1, but we are
concerned that Economía adopted this period without giving any consideration to whether or not it
was appropriate to use this period in the circumstan ces of this particular case. The record does not

257 See Mexico's response to question 156 (a) from the Panel. Economía was certainly aware of the
possibility of acquiring updated information; this occurred in relation to the applicant's allegation of "threat of
material injury" (which is not at issue here). In this respect, the record indicates that Economía did request, in
respect of certain injury factors, updated information at least for a similar time period following the POI. See
Exhibit GTM-2, Question 9) In response, Hylsa provided certain information pertaining to the first semester
(January-June) of 2001, or, in certain circumstances wh ere all of the information was not available, January-
March 2001. See Exhibit GTM 3: "The annexes are documented; volume and value, capacity and the financial
data which update the situation for the indicators contained in the annexes, for the first six months of 2001. The
updated information is documented; some information is still being processed, so not all the information is
documented." See also Hylsa's response to Question 10 in Exhibit GTM-3, referring to other information for the
period January-June 2001.

258 Certain record evidence appears to pertain to the post-POI period. For example, the exporter Tubac
submitted post-POI information relating to imports into Mexico (Exhibit GTM-5, pp. 24-26); and with respect
to the evolution of imports in 2001 (post-POI) (Exhibit GTM-12, p. 25). Tubac was requested to submit
evidence on the evolution of export prices from the preliminary investigation to the date of the technical meeting
in March 2002 (Exhibit GTM-19, pp. 81-2). This information, in response to Question 28 (a), is confidential.

reflect that Economía gave any such specific cons ideration. The explanation for the applicant's
selection of the period, as reflected in the Initiati on Determination and in the Final Determination 259
was that, according to the applicant, it was during th is period that dumped imports caused injury to its
domestic industry. We consider that it would have been appropriate and highly desirable for the IA to
have evaluated whether or not it was appropriate to use this period in the circumstances of this
particular case. This would have provided an en hanced assurance of the ob jectivity of the IA in
selecting the injury POI.
7.237 We further note that none of the interested parties, including Tubac, questioned Economía's
selection of POI at any point during the underlying investigation. Mexico underlines that the POI was
indicated in the Initiation Determination, so that interested parties had knowledge of, and could
challenge it, from that point in time; none did. Mexico asserts that Economía was entitled to rely on
the POI selected in this case in light of the interested parties' tacit admission of its appropriateness.
We have already noted the determinative role of th e POI in establishing the framework for injury data
collection and analysis for the purpo ses of Article 3. We believe that the selection of the POI is
linked to the IA's obligation under Article 3.1 to conduct an objective assessment of positive evidence
and an IA is bound to satisfy its obligations in this respect whether or not it is raised by an interested
party in the course of an investigation. By this, we do not mean to suggest that the established rules
on burden of proof and standard of review would not apply in the event an investigating authority
were challenged in this respect before a WTO Panel.
7.238 In considering the evidence and arguments presented by the parties before us, we have kept in
mind the recent case, Mexico – Anti-Dumping Measures on Rice . There, the panel found that Mexico
had violated Articles 3.1, 3.2, 3.4 and 3.5 of the Anti-Dumping Agreement by relying on a period of
investigation that ended significantly prior to th e initiation of the investigation. In upholding the
Panel's decision, the Appellate Body stated:260
"We agree with Mexico that using a remote investigation period is not per se a
violation of Article 3.1. In our view, however, the Panel did not set out such a
principle, as its findings relate to the speci fic circumstances of this case. The Panel
was satisfied that, in this specific case, a prima facie case was established that the
information used by Economía did not provide reliable indications of current injury
and, therefore, did not meet the criterion of positive evidence in Article 3.1 of the
Anti-Dumping Agreement . The Panel arrived at this conclusion on the basis of
several factors. The Panel attached impor tance to the existence of a 15-month gap
between the end of the period of investiga tion and the initiation of the investigation,
and a gap of almost three years between the end of the period of investigation and the
imposition of final anti-dumping duties. Ho wever, these temporal gaps were not the
only circumstances that the Panel took into account. The Panel, as trier of the facts,
gave weight to other factors: (i) the peri od of investigation chosen by Economía was
that proposed by the petitioner; (ii) Mexico did not establish that practical problems
necessitated this particular period of inves tigation; (iii) it was not established that
updating the information was not possible; (iv) no attempt was made to update the
information; and (v) Mexico did not provide any reason—apart from the allegation
that it is Mexico's general practice to accept the period of investigation submitted by
the petitioner—why more recent information was not sought. Thus, it is not only the
remoteness of the period of investigation, but also these other circumstances that
formed the basis for the Panel to conclude that a prima facie case was established.
In the light of the general assessment of these other circumstances carried out by the
Panel as trier of the facts, we accept that a gap of 15 months between the end of the

260 Appellate Body Report, Mexico – Anti-Dumping Measures on Rice, para. 167.

period of investigation and the initiation of the investigation, and another gap of
almost three years between the end of the period of investigation and the imposition
of the final anti-dumping duties, may raise real doubts about the existence of a
sufficiently relevant nexus between the data relating to the period of investigation and
current injury. Therefore, we have no reason to disturb the Panel's assessment that a
 prima facie case of violation of Article 3.1 was made out." (footnotes omitted)
7.239 We have taken careful note of the considerations in that case. In our view, a key distinction
between that case and the case before us is a factual one. That is, the temporal gaps in the instant case
are not as large, with the result that the investigation period in the case at hand is not as "remote" as in
the Rice case. By choosing to base its determination of injury on a period of investigation which
ended eight months before the initiation of the investigation, and not updating the information,
Economía indubitably lacked the most pertinent, credible and reliable information. However, given
the practical time constraints inhe rent in the production of data that must then be collected and
analysed by the applicant (in order to be reli ed upon and submitted in the application), and then
analysed by the investigating authority, and given th at the investigation occurred within the overall
time constraints envisaged by the Agreement, we do not consider that Guatemala has established that
the temporal gaps in this case precluded Economía fr om making a determination of injury based on
positive evidence and which involved an objective examination.
7.240 For these reasons, we find that Guatemala has faile d to establish that, in the circumstances of
this case, Economía violated its obligations under Ar ticles 3.1, 3.2, 3.4 and 3.5 by relying on data
from an investigation period that terminated about eight months prior to the initiation and about
two years prior to the imposition of the definitive measures.
3. Use of six-month periods for the injury analysis
(a) Arguments of the parties
(i) Guatemala
7.241 Guatemala argues that Mexico acted inconsistently with Articles 3.1, 3.2, 3.4 and 3.5 of the
Anti-Dumping Agreement as it improperly limited its injury analysis to data relating to
six-month periods each year within the period of investigation (July–December 1998, 1999 and 2000),
resulting in a determination of injury and causal link that was not based on an objective examination
of positive evidence.
(ii) Mexico
7.242 Mexico contends that Guatemala fails to establish a prima facie case that its investigating
authority did not comply with Articles 3.1, 3.2, 3.4 and 3.5 of the Anti-Dumping Agreement in using
six-month periods from each year of the period of investigation for the purposes of its injury analysis.
(b) Arguments of the third parties
7.243 The European Communities endorses Guatemala's assessment under Articles 3.1, 3.2, 3.4
and 3.5. According to the European Communities, in this case, there is no indication that the selective
use of six-month data is justified (e.g. on seasonal grounds).
7.244 Japan takes no position on the factual aspects of this case, but asserts that there would not be
an objective examination required by Article 3.1 if authorities consider only limited information out
of a limited period of each year without "proper justification".

7.245 The United States agrees with Guatemala that an objec tive determination cannot be based on
an incomplete series of data unless the investiga ting authority provides a justified explanation for
doing so. While there does not appear to be evid ence that the six-month periods used here were
periods of highest import penetra tion, it would in most cases be difficult to demonstrate dumping
causing current injury by looking at six-month snapshots over a three-year period.
(c) Evaluation by the Panel
(i) Factual background
7.246 We begin with the undisputed facts on the Pa nel record. Economía adopted the dumping and
injury POIs proposed by the applicant. For its dumping determination, Ec onomía relied upon data
pertaining to a six-month POI: July-December 2000. In making its injury determination, Economía
identified the same six-month period as the "POI " and relied principally upon data from three six-
month periods (July-December 1998, 1999, 2000).261
(ii) Analysis
7.247 We see the issue raised by Guatemala's claim as whether Economía fulfilled the Article 3.1
obligation to conduct an objective examination of positive evidence in relying on data from three
six-month periods (July-December 1998, 1999, 2000) in making its injury determination. As already
mentioned, because Article 3.1 sets out an overarching principle that informs the injury obligations in
the rest of Article 3, our views on this issue will also resolve Guatem ala's claims here under
Articles 3.2, 3.4 and 3.5 of the Anti-Dumping Agreement.
7.248 As we have already emphasized, the selection by an investigating authority of the period of
investigation is a critical element in the anti-dumpi ng investigative process: it determines the data
that will form the basis for the assessment of dum ping, injury and the causal relationship between
dumped imports and the injury to the domestic industry.
7.249 We agree with Mexico to the extent it argu es that the Anti-Dumping Agreement does not set
forth any express requirement regarding the choice of the period of investigation for the purpose of
conducting an injury analysis.262 However, as also acknowledged by Mexico, this does not mean that
an investigating authority's discretion in respect of the period it selects as the basis for its injury
analysis is unlimited. 263 We consider that the Article 3.1 requirement to base a determination of
injury on positive evidence and pursuant to an objective examination neve rtheless impose certain
limitations on an investigating authority's discret ion with regard to the comprehensiveness and
reliability of the data used as the b asis for its injury determination. In this respect, we recall that,
under the standard of review set forth in Article 17.6 of the Anti-Dumping Agreement, we are called

 261 The notice of initiation, Exhibit GTM-4, para. 90, indicates that the applicant, "proposed the period
from July to December 2000 as the period to be investigated because during that time imports of standard pipe
from Guatemala were carried out in conditions of price di scrimination, which was reflected in a deterioration of
its production plant, commercial activity and financial operations. The Ministry determined the period July-
September 2000, which meets the requirements laid down in the law, as the period to be investigated".

See also Exhibit GTM-23, para. 152. In its determination, Economía relied principally on data from
July-December 1998, 1999 and 2000. See Exhibit GTM-23, paras. 156 ff.

262 We refer to and incorporate our views above, para.7.225.

263 See e.g. Mexico's response to question 44 from the Panel.

upon to assess whether the investigating authority' s establishment of the facts was proper, and its
evaluation unbiased and objective.
264
7.250 We consider that an objective examination of positive evidence of the effects of dumping on
the state of the domestic industry which enables the authority to conclude that dumped imports are
causing injury to the domestic industry involves an analysis of trends over time of the volume and
price of imports and of the state of the domestic industr y. It is only such an analysis that will enable
the authority objectively to gauge the effects of the dumped imports on the domestic industry as
required by Articles 3.1, 3.2 and 3.4 of the Anti-Dumping Agreement, and to assess whether the
injury found to exist is caused by the dumped imports, as required by Article 3.5 of the Anti-Dumping
Agreement.
265
7.251 We therefore consider whether Economía's use of a subset of data temporally limited to
July-December 2000 266 and the corresponding six-month periods in the two previous years (1998,
1999), was capable of yielding an accurate and representative picture that in turn enabled Economía to
make an objective examination of positive evidence in reaching its affirmative injury determination.
7.252 We are of the view that, absent any proper jus tification for doing so, such an examination on
the basis of an incomplete set of data proposed by an applicant cannot, in principle, be an objective
examination of positive evidence. In our view, an investigating authority is precluded from using
temporal subsets within a period, without a suffici ent explanation and without a consideration as to
whether the developments within that temporal s ubset are reflective of developments throughout the
period or whether and why these subsets are justifie d and not anomalous. This truncated temporal
approach of using only certain data for the inju ry analysis does not constitute a proper establishment
of the facts on which to base the determination.
7.253 We hasten to point out that our decision should not necessarily be understood to say that there
could never be any convincing, valid reasons for ex amining data pertaining to only certain parts of
years (although, in our view, that may be an excep tional case). However, in the case at hand, Mexico
has not presented any effective refutation to Guatemala's claim by pointing to a proper justification by
Economía for the use of the six-month periods. Mexico's main justification before us was a
"structural symmetry" argument that the period of investigation for purposes of the dumping
determination was July-December 2000, and that, th erefore, a corresponding six-month period should
be used in the injury analysis in order to avoid "distortions" in the comparison between the period of
investigation for purposes of the dumping determina tion and the period of investigation for purposes
of the injury analysis. In particular, Mexico asserted:

264 The Appellate Body in the EC – Bed Linen (Article 21.5 – India) case also linked the objective
examination requirement with the panel's standard of re view that requires it to exam ine whether the authority's
establishment of the facts was proper. The Appellate Body explained:

"These requirements of paragraphs 1 and 2 of Article 3, as well as the requirements of
Article 17.6(i), that investigating authorities establish the facts of the matter properly and
evaluate those facts in an unbiased and objective manner, are mutually supportive and
reinforcing. "

 Appellate Body Report, EC – Bed Linen (Article 21.5 – India), footnote 141.

265 We find support for our approach in Panel Report, Mexico – Anti-Dumping Measures on Rice ,
para. 7.80. The Appellate Body upheld the Panel's finding on this issue. See, in particular, Appellate Body
Report, paras. 180-188.

 266 See supra, para. 7.246.

"... Mexico carried out an analysis and objective evaluation, taking account of
previous comparable periods in order to avoid distortions in the comparison of the
period of investigation of dumping with the period of injury analysis".267
7.254 However, while it is certainly appropriate for the injury POI to include the entirety of the
dumping POI, we see no necessity or requirement in the Anti-Dumping Agreement for a period of
investigation on the injury analysis to be limited st rictly to the period of investigation for the dumping
analysis, particularly where the latter period of investigation covers a period of less than 12 months.
7.255 Although Mexico asserted that Economía used "s ymmetrical" six-month periods from each
year in order to avoid distortions 268, Mexico also confirmed that it was not, in fact, arguing that the
use of data pertaining to six-month periods would provide better information than the use of annual
data, or that the use of annual data would produce distortions. 269 In any event, it is not clear to us
how the use of data relating to the whole three- year period, as opposed to three six-month periods
within those years, would have introduced distortions (or would have resulted in more distortions) to
the assessment of the "state of the domestic industry". In this respect, we find support in the following
statement of the Appellate Body in Mexico – Anti-Dumping Measures on Rice:270
"We fail to see how, in the present case, the u se of data relating to the whole year, as
opposed to the March to August period, woul d have introduced "distortions" of the
assessment of the "state of the domestic industry". Rather, in our view, examining
data relating to the whole year would result in a more accurate picture of the "state of
the domestic industry" than an examination limited to a six-month period."
Similarly, in the case at hand, we consider that an examination of data relating to the whole years
would produce a more accurate and representative pict ure of the "state of the domestic industry" than
an examination limited to three six-month periods.
7.256 We note that companies customarily maintain annual financial, investment and accounting
records. In this case, certain data pertaining to the entire three-year period was on the record. 271
Mexico asserted, and the Preliminary (and Final) Dete rminations confirm, that financial information
pertaining to Hylsa-DAT was submitted on an annual 272, as well as semestral, basis, and Economía
asserted that it was able to verify the corresponden ce between the two. In response to questioning,

268 See, for example, Mexico's first written submission, paras. 194-196. At para. 195, Mexico stated:
"that a semester of a year is structurally the same as the corresponding period of the previous year".

269 See Mexico's response to question 155 from the Panel.

270 Appellate Body Report, Mexico – Anti-Dumping Measures on Rice, para. 183.

271 Exhibit GTM-1, question 62, indicates that Econom ía sought, for example, with respect to sales,
"monthly information for the thirty-six months making up the period analysed ...". Annex 6 of the applicant's
questionnaire in Exhibit GTM-1 indicat es that Economía requested and recei ved "Statement of costs, sales and
profits of the like product" on an annual basis (for 1988, 1989) and for the six-month periods, July-December
1999 and 2000. Exhibit GTM-1, applicant's questionnaire, Annex 4 ("Domestic market indicators"), 5A
("Applicant company's indicators, volumes") and 5B ("Applicant company's indicators, values") reflect monthly
data over the three years. As a further example, th e 17 December 2001 requests from Economía to domestic
firms and CANACERO contained a chart asking for ec onomic injury factor data relating to the first and second
semesters of 1998, 1999 and 2000, as well as any imports between January 1998 and December 2000.

272 See Preliminary Determination, Exhibit GTM-10, para. 169; see Final Determination, Exhibit
GTM-23, e.g. paras. 215, 219-225.

Mexico further asserts that Economía never translat ed annual information into semestral information,
as most of the information on economic indicators was given on a monthly basis.
273 We consider that
Mexico's account is not altogether consistent throughout these proceedi ngs and it is not evident to us
from the record how Economía conducted such a reconciliation. 274 Moreover, such reconciliation
would only have been in respect of a subset of the injury data used to reach the overall injury
determination. Furthermore we note that Mexico's position in this dispute is that it was unnecessary
to seek full-year data:275
"Bearing in mind that the second half of 2000 was taken as the period of investigation
and hence the same previous periods for th e purpose of comparison, with regard to
economic indicators, no consideration at all w as given to whether or not to take into
account any information corresponding to the pe riod of thirty-six months, or to the
reconciliation of the trends in the th ree six-month periods with the annual
information. However, it should be poi nted out that in the case of financial
indicators, for variables where there was only annual information, the analysis took
account of full years."
7.257 We consider it significant that, in response to questioning as to: (i) whether any practical
problems necessitated the use of the particular PO I relied upon in this investigation for the injury
analysis; (ii) whether it was established that use of a comprehensive data set pertaining to the whole
three years was not possible or practicable; (iii) whether Economía considered the representativeness
of the semestral data vis-à-vis the data for the entire three year period; and (iv) whether any attempt
was made to gather a comprehensive data set pert aining to the whole three years, Mexico confirmed
that, as Economía deemed that the POI was appr opriate and that the information before it was
adequate in order to complete its investigation, Ec onomía made no attempt to gather and/or analyse a
complete data set for the three years. 276 Nevertheless, the record indicates that, for certain injury
factors, Economía did take annual information into account. 277 We consider that Economía did not
perform a comprehensive assessment of the extent to which the injury data upon it relied provided an
accurate reflection of the state of the domestic industry over the whole three-year period concerned
(1998, 1999, 2000).278
7.258 We recall the disagreement between the parties as to whether or not record evidence indicated
that the POI used by Economía was "selective" in the sense, for example, of being the period of

273 Mexico's response to question 160 from the Panel. Mexico asserts in response to question 160 (a)
from the Panel that, "[t]o validate this information in operational terms, the investigating authority added up the
headings sales income, cost of sales, gross profit, operating expenses and operating profit for the first and
second semesters and the result obtained was equal to the figures for the same headings in annual terms. The
Ministry therefore deemed the figures for the first semester to be correct as regards economic indicators".

274 The Preliminary Determination, Exhibit GTM-10 , paras. 169-170 indicates, for example, that
"Hylsa, Division of Steel Tubing,… provided by the applicant in annual terms. For the sake of financial
comparability, the Ministry updated the financial information on the basis of the method of changes in the
general level of prices …".

275 See Mexico's response to question 52 from the Panel.

276 See Mexico's responses to questions 30 and 47-53 from the Panel.

277 See the table summarizing time periods taken into account in respect of the various injury factors in
Guatemala's first written submission, para. 262.

278 We recall our view of the determinative role of the POI in terms of the Article 3.1 obligation to
perform an objective examination of positive evidence, an d incorporate here our views expressed in para.7.237
supra.

highest import penetration. The question arises because Economía departed from a POI with
comprehensive and continuous tempor al coverage by accepting the applicant's proposed POI, and the
two previous six-month periods. Moreover, becau se Economía gave no comprehensive consideration
as to whether and how the trends within the six-mo nth periods related to de velopments outside that
period, it is not clear to us how Economía could have been confident that its approach avoided, rather
than caused, distortions, and, in particular distortions that might have been favourable to the applicant.
In the Initiation Resolution, Economía stated that th e applicant "said that consumption of standard
pipe is largely related to the behaviour of th e construction and manufacturing industries. The
applicant stated in particular that on the domestic ma rket consumption of standard pipe is the same all
year except for a few months where, for fiscal reasons, there is an increase, as in December, or a drop,
as in April ...".279 The Final Determination reads, in part: "... the applicant stated that on the domestic
market consumption of the pipe under investigation is normally constant all year, other than in a few
months for fiscal reasons."280 We consider that the applicant's indication of variations in consumption
patterns should have provided even more of an in centive for Economía to evaluate how such alleged
trends within an annual period may or may not have been reflected in the data pertaining to the three
six-month periods relied upon by Economía. Howe ver, the record indicates that Economía accepted
the applicant's assertion without undertak ing any such comprehensive evaluation. 281 E v e n t h o u g h
there is no clear indication in the record that the PO I was chosen in order to be "biased" in favour of
the applicant, as for example, to reflect a period when imports clearly increased, in the absence of any
explanation as to whether or how the POI consis ting of the six-month period proposed by the
applicant, and two previous periods of six-months was appropriate and reflective of the state of the
domestic industry over the relevant period, we consider that the PO I was indeed "selective" in the
circumstances of this case.
7.259 We note Mexico's argument that none of the in terested parties, including Tubac, questioned
Economía's selection of POI at any point during the underlying investigation. Mexico underlines that
the POI was indicated in the initiation notice, so th at interested parties had knowledge of, and could
challenge it, from that point in time; none did. Mexico asserts that Economía was entitled to rely on
the POI selected in this case in light of the interested parties' tacit admission of its appropriateness.
However, as the selection of the POI is linked to an investigating authority's obligation under
Article 3.1 to conduct an objective assessment of pos itive evidence, that authority is bound to satisfy
its obligations whether or not this issue is rai sed by an interested party in the course of an
investigation.282 We therefore do not believe that the fact that the issue was not raised by any
interested party in the course of the underlying inves tigation justifies the lack of any attention to this
issue by Economía.
7.260 We recall the findings of the panel (upheld by the Appellate Body) in the recent Mexico –
Anti-Dumping Measures on Rice dispute. Considering a claim of inconsis tency with Article 3.1, that
panel (upheld on appeal) found that the data used by the Mexican investigating authority – similarly
pertaining to six-month periods within the investig ation period – did not provide an "accurate and

279 Exhibit GTM-4, para. 88.

280 Exhibit GTM-23, para. 151. See similar citation in the preliminary resolution, Exhibit GTM-15,
para. 113.

281 We note Mexico's reference (in paragraph 155 of Mexico's rebuttal submission) to paras. 202
and 203 of the Final Determination, where Economía sets out its findings that the Mexican market, measured in
terms of consumption, "remained practically constant in the periods July-December 1998 and 1999, then rose
5 per cent in the period July-December 2000 …". We do not consider that this finding of essentially "constant"
consumption in relation to developments in the six-month periods is necessarily reflective of developments in
the other six-month periods in those years.

282 See supra, para.7.237.

unbiased picture". That panel found an inconsis tency with Article 3.1 not only due to the
investigating authority's selective use of the info rmation gathered for the purpose of the injury
analysis (without any proper justification), but al so the acceptance by the investigating authority of
the period of investigation proposed by the petitioner, knowing that the petitioner proposed that period
because it allegedly represented the period of hi ghest import penetration. In the specific
circumstances of that case, these two factors, c onsidered together, were sufficient to make out a
 prima facie case that the data used by the investiga ting authority did not pr ovide an "accurate and
unbiased picture". The panel (upheld on appeal) f ound that Mexico had not presented an "effective
refutation" of that prima facie case by providing a proper justifica tion for the use of the six-month
period. The only explanation presented by Mexico was that the period of investigation for purposes
of the dumping determination was March to Augus t 1999, and that, therefore, a corresponding six-
month period should be used in the injury analysis in order to avoid "distortions" in the comparison
between the period of investigation for purposes of the dumping determination and the period of
investigation for purposes of the injury analysis. A lthough the case is, in some respects, similar to the
one before us, we wish to point out that our finding here rests on a slightly different basis. That is,
while our finding rests in part on the "selectivity" inherent in Economía's acceptance of the injury POI
proposed by the applicant without sufficient justification, we also focus upon on the non-
comprehensiveness and unreliability of the factual b asis used by Economía, i.e., an incomplete data
subset from three six-month periods in 1998, 1999 a nd 2000 that had been proposed by the applicant
and accepted by Economía without sufficient evaluation and justification of its representativity of
developments over the injury POI.
7.261 For the above reasons, we find that Economía's re liance, without sufficient justification, upon
a subset of data temporally limited to three six-month periods (July-December) over three consecutive
years (1998, 1999, 2000), as proposed by the applican t, was not capable of yielding an accurate and
representative picture enabling Economía to make an objective examination of positive evidence in
reaching its affirmative injury determination. We therefore find that Economía acted inconsistently
with Mexico's obligations under Articles 3.1, 3.2, 3.4 and 3.5 of the Anti-Dumping Agreement.
4. Volume and price effects of dumped imports
(a) Arguments of the parties
(i) Guatemala
7.262 Guatemala claims that Mexico violated Articles 3.1 and 3.2: (i) in estimating the volume of
imports of the product under investigation from countries other than Guatemala by using a non-
representative sample for six-month periods, and by applying unfounded hypotheses (according to
Guatemala, the resulting figures were not positive evid ence and the IA's examination of them was not
objective; such imports are a component of domestic consumption in the injury analysis and the IA
relied on such evidence in concluding that the increased imports from Guatemala (relative to domestic
consumption) had had negative volum e and price effects in the Mexican market); (ii) in evaluating
the price effects of imports from Guatemala, Economía used an insufficient sample of 17 per cent of
all imports from Guatemala, and performed its anal ysis of price effects for only for one six-month
period (July-December 2000).
(ii) Mexico
7.263 Mexico counters that the estimation methodology used by the IA for imports from sources
other than Guatemala was sound, that no alternative source existed for the information, and that the
sample it relied on was representative as it was based on significant volumes out of the total imported,
and reflected data for the largest importers. In resp ect of the price effects of imports from Guatemala,
Mexico disagrees with the factual premise of Guat emala's allegation, arguing that the 17 per cent

sample was used only for the purpose of estimating the charges for bringing the imported merchandise
from the port of entry to the Mexican customer's warehouse. Therefore, Mexico argues, the IA's
conclusions as to the volume and price effects of th e dumped imports were in conformity with the
obligations in Articles 3.1 and 3.2 of the Agreement.
(b) Evaluation by the Panel
7.264 We consider whether Economía conducted an objective examination based on positive
evidence in its analysis of the volume and price effects of the dumped imports. Guatemala's
allegations in respect of Economía 's treatment of the volume and price effects of the dumped imports
in the course of its injury analysis under Articles 3.1 and 3.2 of the Anti-Dumping Agreement focus on
two main elements: first, the methodology u sed by Economía to estimate the volume of the
investigated product from sources other than Guatem ala (used as a component in estimating domestic
consumption); second, the sample and period used to estimate the price effe cts (or aspects of these
effects) of imports from Guatemala. We consider each in turn.
(i) Methodology to estimate volume of im ports from sources other than Guatemala

7.265 We begin our analysis by recalling the text of Articles 3.1 and 3.2 of the Anti-Dumping
Agreement, cited above. We agree with the views in previous dispute settleme nt reports that it flows
from reading these two provisions together that th e basis of any evaluation as to the volume of
dumped imports or the price effects of su ch imports has to be "positive evidence".
283 As we have
already stated, the term "positive evidence" in Articl e 3.1 relates "to the quality of the evidence that
authorities may rely upon in making a determination" and that "[t]he word 'positive' means ... that the
evidence must be of an affirmative, objective and verifiable character, and that it must be credible." 284
We also recall that, in Thailand – H-Beams, the Appellate Body said that "Article 3.1 is an overarching
provision that sets forth a Member's fundamental, subs tantive obligation" with respect to the injury
determination, and that this ge neral obligation "informs the more detailed obligations" in the
remainder of Article 3.
285 Therefore, the question before us is whether Economía based its
determinations regarding the volume of dumped imports from sources other than Guatemala and the
effect of the dumped imports on prices in the domestic market on information that has the quality of
positive evidence.
7.266 As discussed in detail at paragraphs 7.44 to 7.59 , supra, from the outset of the investigation, it
was clear that the two tariff lines under which the investigated product was classified (7306.30.01 and
7306.30.99) also covered other products. The Final Determination s hows that Economía was
conscious of the need to distinguish the subj ect imports – both from Guatemala and from other
sources – from imports of all other products entering under the two relevant tariff lines.
7.267 More specifically, in respect of import volum es, Economía relied on estimates derived from
import statistics and samples of "pedimentos" and their underlying invoices. By the final phase of the
investigation, Economía had obt ained customs documentation and invoices covering nearly 100 per
cent of the "investigated product" imported from Guatemala during the three six-month periods
reviewed.

283Panel Report, Mexico – Anti-Dumping Measures on Rice , para. 7.98; Appellate Body Report,
Mexico – Anti-Dumping Measures on Rice, para. 202.

284Appellate Body Report, US – Hot-Rolled Steel, para. 192.

285Appellate Body Report, Thailand – H-Beams, para. 106.

7.268 Economía explained in the Final Determina tion how it established the volume of dumped
imports of the subject product from Guatemala into Mexico.
286 In respect of the volume of subject
imports from Guatemala, the Determination indicates that Economía:
"... collected 31 copies of additional ‘ped imentos’ with their respective invoices
corresponding to imports from the Republic of Guatemala under TIGIE tariff items
7306.30.01 and 7306.30.99, so that together with the 312 in its possession in the
preliminary stage, it had a total of 343 import pedimentos, 202 of which corresponded
to import transactions in the period July-D ecember 2000, 137 to transactions in the
same period of 1999 and 4 in the same seme ster of 1998; these ‘pedimentos’ covered
nearly 100 per cent of the volume imported from the Republic of Guatemala for the
period analysed."287
7.269 On the basis of this information, Economía asserted:
"According to the characteristics and specifica tions of the investigated product in the
product likeness section of this Resolution, an analysis of the documentation gave the
following results: in the periods July-December of 1998, 1999 and 2000, 79, 66 and
64 per cent of the import volume correspond, respectively, to investigated products,
and the remaining percentages to non-inves tigated products. In particular, in the
period July-December 2000, of the volume identified as investigated products 82 per
cent corresponded to pipe manufactured to standard ASTM A-53 and 89 per cent was
schedule 40."
288
7.270 In respect of imports of the product under i nvestigation under the two relevant tariff lines
from countries other than Guatemala, the Final Determination indicates:289
"... the Ministry collected 599 copies of "p edimentos" with their respective invoices,
corresponding to imports from countries ot her than the Republic of Guatemala under
TIGIE tariff items 7306.30.01 and 7306.30.99, so that in all, including those of the
preliminary stage, the IA was in possession of a total of 673 import ‘pedimentos’, 546
of which corresponded to import transacti ons in the period July-December 2000, 79
to transactions in the same period in 1999 and 48 in the same period in 1998; these
"pedimentos" covered respectively 48, 16 and 10 per cent of the total volume
imported from sources other than the investigated country in the periods indicated."
7.271 To estimate the volume of imports of the investigated product from sources other than
Guatemala, Economía applied the following methodology:
"... for each period referred to, maximum and minimum prices were identified for the
imports identified as investigated products, on the basis of the invoices and import
‘pedimentos’ reviewed. Then, on the basis of the SICMEX list of import
‘pedimentos’, from the operations invol ving imports from sources other than
Guatemala, those transactions were iden tified that fell within the minimum and

286 Exhibit GTM-23, Final Determination, paras.163-165. See also paras. 120-121 of the Preliminary
Determination in Exhibit GTM-10.

287 Exhibit GTM-23, para. 164.

288 Exhibit GTM-23, para. 165.

289 Exhibit GTM-23, para. 166.

maximum price range of the import opera tions identified as pipe subject to
investigation."290
7.272 On this basis, Economía estimated that in the July-December periods of 1998, 1999 and 2000,
the investigated products accounted for 81, 72 and 67 per cent of the total volume and 65, 58 and
49 per cent of the total value of imports from countries other than Guatemala, respectively.
7.273 Thus, in respect of imports from sources other than Guatemala, Economía obtained
documentation covering not more than 48 per cent of the total imports under the relevant tariff
categories during these periods. 291 As we have already mentioned, from these documents Economía
estimated the total import volume of the investig ated products from countries other than Guatemala
by identifying the ranges of minimum and maximu m prices for the imports known to be of the
relevant product, then assuming that all importe d products with prices within those ranges were
investigated products.
7.274 According to Guatemala, import figures are an important component in the calculation of
apparent domestic consumption, a nd Article 3.2 requires the volume effect of dumped imports to be
assessed inter alia against domestic production or consumption. Therefore, according to Guatemala,
both the IA's calculation of consumption, and its analysis of whether dumped imports had increased
relative to consumption, were flawed. Guatemala further argues that the IA should have based its
analysis on evidence that was more "positive" or at least should have explaine d in its determinations
why it was not possible to use 100 per cent of the customs documents, and why the sampling
methodology that it used was reasonable.
7.275 It is clear that, as argued by Guatemala, the volume of imports from countries other than
Guatemala formed part of Economía's injury determination. The Final Determination indicates that:
"... in order to assess whether, in the peri od investigated, there was an increase in
imports in relation to internal consumpt ion and domestic production, an estimate was
done of the size of the Mexican market for the investigated pipe, on the basis of
domestic production figures plus imports less exports. Impor ts were calculated using
the methodology described in points 163 to 169 of this Resolution."
292
7.276 We note that, in the course of the investig ation, Tubac contested the validity of the
methodology used by Economía in estimating the volume of imports from sources other than
Guatemala.
293 Tubac also indicated, in the course of th e investigation, that it did not have the
necessary information to offer an alternative estimate of the volume of such imports.294
7.277 The parties' claims and arguments about the sa mpling and estimation techniques in respect of
imports from sources other than Guatemala ra ise the question whether the methodology for
calculating the volume of imports from sources othe r than Guatemala rested on sufficient evidence

290 Exhibit GTM-23, paras. 167 and 168.

291 As indicated in the Final Determination, Exhibit GTM-23, para. 166, the coverage of the samples of
customs documents and related invoices was 48 per cent for July-December 2000, 16 per cent for July-
December 1999 and 10 per cent for July-December 1998.

292 Exhibit GTM-23, para. 173.

293 Exhibit GTM-23, para. 159.

294 Exhibit GTM-23, para. 161.

and substantiated assumptions so as to constitute positive evidence for the purposes of Articles 3.1
and 3.2. In particular, we must consider whethe r the use of this methodology – based on samples of
48, 16 and 10 per cent of imports of the product from sources other than Guatemala in the three
relevant periods of 2000, 1999 and 1998, respectivel y, and the application of a price range test -
resulted in an injury analysis that was consistent with the requirements under Articles 3.1 and 3.2 of
the Anti-Dumping Agreement to conduct an objective examination based on positive evidence of the
volume and price effects of the dumped imports.
7.278 In considering the soundness of the methodology us ed by the IA in respect of the imports of
the investigated product from sources other than Gu atemala, we recall the following statement of the
Appellate Body:
"... Articles 3.1 and 3.2 do not prescribe a methodology that must be followed by an
investigating authority in conducting an injury analysis. Consequently, an
investigating authority enjoys a certain discretion in adopting a methodology to guide
its injury analysis. Within the bounds of th is discretion, it may be expected that an
investigating authority might have to re ly on reasonable assumptions or draw
inferences. In doing so, however, the inv estigating authority must ensure that its
determinations are based on ‘positive evidence’. Thus, when, in an investigating
authority's methodology, a determination rests upon assumptions, these assumptions
should be derived as reasonable inferences from a credible basis of facts, and should
be sufficiently explained so that their objectivity and credibility can be verified."
295
7.279 Mindful of these considerations, we examine the soundness of the methodology applied by
Mexico, in particular, the resort to the "pedimento" samples concerned and the application of the price
range test.
7.280 In respect of the "pedimento" samples, Mexico opted to request such customs documentation
from private sources, such as customs agents, instead of from the presumably comprehensive official
set of "pedimentos" in the hands of the Treasury ministry (another Mexican government agency).
Mexico replied as follows to the Panel's query as to why the IA (a Mexican government agency)
resorted to seeking samples from private sources, instead of from the other government agency and
whether it would have been practicably impossible for Economía to have obtained the customs
documentation concerned directly from "the office of the Treasury":
"In our view the term ‘impossible’ is not the most apt. What is true is that the
Ministry has great difficulty in obtaining documentation from the offices of the
Treasury, although the two are government agen cies. The steps the Ministry takes to
obtain the relevant information do not al ways achieve the best results, because the
body from which the information is sought does not
 always respond.
In practice, to ask for information in th e possession of the customs authorities would
mean a very long delay in the investigati on as well as imposing a very considerable
administrative burden. In fact, this step alone would have taken up a fairly long
period and affected the time limits for the investigation, with the possibility , too, of
not obtaining the information. It is for this very reason that, in an attempt to obtain
reliable and timely information so as meet deadlines, the Ministry addresses requests
for information to customs agents and impor ters. However, the IA also lacks the
authority to require customs agents or im porters to supply the information sought.

295 Appellate Body Report, Mexico – Anti-Dumping Measures on Rice, para. 204.

Even when it approaches these bodies, the Mini stry frequently fails to obtain all the
information requested …". 296
By way of illustration, in a recent case (involving brushes from China), import
‘pedimentos’ with the corresponding invoices were requested from the Treasury. The
latter took about three months to provide th e Mexican authority with 30 ‘pedimentos’
and their invoices (it is reasonable to suppose that the time taken would increase
according to the Treasury office's workload at the time the request is made by the
Mexican IA). Another case in which there were delays of this kind is that involving
valves from the United States ...".
7.281 Mexico further indicated that,
"... as part of its administrative practice, when trying to obtain reliable and timely
information so as to meet deadlines applyi ng under anti-dumping legislation, the IA
normally addresses requests for information directly to customs agents and import
companies (often interested parties), whic h likewise have the documentation for the
imports but which nearly always take a r easonably shorter amount of time to respond
than would the Treasury if asked to supply the information ...".
297
7.282 From this, we understand that it would not have been physically or technically impossible for
Mexico to have made a request to the Treasury Mi nistry for "pedimentos", but rather that it might
have taken some time to receive the requested "ped imentos". We recall the example given by Mexico
of another recent case in which the SHCP t ook three months to produce certain requested
"pedimentos".298 This does not convince us that the time required by Treasury to produce a
comprehensive, or at least statistically robust, set of "pedimentos" could not have been accommodated
within the timeframe of the normal anti-dumping inv estigation. We recall that Article 5.10 of the
Anti-Dumping Agreement provides: "Investigations shall, except in special circumstances, be
concluded within one year, and in no case more than 18 months, after their initiation." The
investigation at issue lasted approximately 17 mont hs. It seems to us that if Economía had made a
request at or near the outset of the investigation, it could have received a comprehensive, or at least
statistically robust, response well within the time-fram es of this investigation. We would have vastly
preferred that Economía acquire a comprehensive offici al data set – or at least a statistically robust
sample – from the competent Mexican government agen cy. We believe that such information would
have been the best available source to calcu late volumes of imports from sources other than
Guatemala. However, we are aware that, for certa in Members, considerable periods of time may be
needed in order to acquire such information fro m the competent government agencies, and that, for
the purposes of conducting a timely investigation as required by the Agreement 299, it may not always
be possible to acquire such information from a govern ment source. In any event, we do not consider
that simply by not seeking inform ation from official government sources, Economía's analysis would
necessarily be flawed.
7.283 In respect of the limited "pedimento" samples of varying magnitudes in question (i.e. 48, 16
and 10 per cent), Mexico explains that Economía was able to get almost 100 per cent of the
"pedimentos" pertaining to imports from Guatemal a because the volume of such imports was not as

296 Mexico's response to question 72 from the Panel.

297 Mexico's response to question 72 from the Panel.

298 Exhibit MEX-4.

299 In particular, Article 5.10.

high as the volumes of imports from sources other than Guatemala, and there were not very many
transactions. We are aware that the number of import transactions from countries other than
Guatemala was relatively high and that, as Mexico argues, Economía requested a larger set of
"pedimentos" than it finally obtained.
300 We nevertheless consider th at Economía should have better
demonstrated or explained why it was not possible to obtain the actual figures using the "pedimentos"
or at least to have obtained more comprehensive/better sampl es, in terms of magnitude and
consistency over time. The Preliminary Determination 301 indicates that the IA anticipated receiving
313 fiscal "pedimentos" from 59 customs agents, but that only 16 customs agents produced the
requested information; therefore, according to Me xico, the IA received only 22 per cent of what had
hoped for. The Final Determination indicates that "the Ministry sought additional information from
several import companies and customs agents". 302 Nevertheless, in light of the limited and
inconsistent sample sizes available at the time of the Final Determination, there is no indication that
Economía attempted to find another way to bolster th e robustness of its sample sizes, or reconcile its
samples more comprehensively with the overall picture of imports from sources other than
Guatemala.
303
7.284 With respect to the price range test applied by Mexico to identify the product that it would
take into account for the purposes of estimating the volume of imports from sources other than
Guatemala, we observe that there is no explanatio n as to why this test would produce a systematic,
reliable, or statistically valid result. There is no substantiation of the price assumptions underlying
this approach. We note that Mexico admits th at "... for the imports from countries other than
Guatemala, the documentation was to some extent li mited ... it is clear that the volume of the pipe
under investigation was estimated using the me thodology of the maximum and minimum prices
identified for the investigated pipe ...".
304 Mexico further asserted:
"Considering that the volumes of the inv estigated pipe from countries other than
Guatemala were the result of an estimate made using maximum and minimum prices
that the IA identified for import transactions for the investigated pipe, on the strength
of the documentation in its possession it is reasonable to assume that in fact non-
investigated products could have been included or investigated pipe excluded. The IA
nonetheless deemed the methodology to be th e most reasonable in the light of the
documentation it had."305
7.285 We consider that, taken together, the "pedimen to" sample sizes of 48, 16 and 10 per cent and
the price range test that Economía applied to th ese imports from sources other than Guatemala are not
sufficient to give a reliable, representative picture about imports from sources other than Guatemala.
We therefore consider that Economía acted inc onsistently with Articles 3.1 and 3.2 of the Anti-
Dumping Agreement due to the limited magnitude and cons istency of samples, together with the

300 1720, 1752 and 2456 transactions for the 1998, 1999 and 2000 periods, respectively. See Mexico's
response to question 73 from the Panel; Mexico's first written submission, para. 238.

301 Exhibit GTM-10, para. 122.

302 Exhibit GTM-23, para. 163.

303 Article 55 of Mexico's Ley de Comercio Exterior, Exhibit GTM-14, indicates that Economía is
entitled to ask for information from a wide range of sources, including producers, distributors, customs agents or
any other person.

304 Mexico's response to question 102 from the Panel.

unsubstantiated price range assumptions on which Econom ía relied to estimate the volume of subject
products imported from countries other than Guatemal a. An investigating authority that uses a
methodology premised on a limited sample and un substantiated assumptions does not conduct an
examination based on positive evidence. An assu mption is not properly s ubstantiated when the
investigating authority does not explain why it would be appropriate to use it in the analysis. The
assumption with respect to maximum and minimum price range to identify the investigated product
on which Economía relied in its methodology play ed a role in its reasoning. In the Final
Determination, Economía did not explain why the use of limited samples of varying magnitudes,
together with the price range test, was appropriate and credible in the analysis of the volume and price
effects of the dumped imports, or how this met hodology would provide an accurate picture of the
volume and price effects of the dumped imports.306
7.286 We now consider Guatemala's further allegation that Economía assumed that the prices of the
products imported from Guatemala and from all other countries were the same in all instances (i.e.,
that the minimum and maximum prices used to estimated import volumes for the "other" countries
were for imports from Guatemala). Mexico asserts that this allegation is based on an incorrect
reading of the Final Determination, and that the price range of the subject imports from Guatemala
was not used to estimate the volume of the subject imports from the other countries. Our review of
the Final Determination persuades us that Gu atemala's allegation is factually erroneous.
307 I n
particular, paragraphs 164 -165 of the Final Determination address "pedimentos" relating to imports
from Guatemala. By contrast, paragraphs 166- 169 address "pedimentos" corresponding to imports
from sources other than Guatemala. We have already cited th ese paragraphs above.308 They indicate
to us that Economía resorted to the "ped imentos" pertaining to imports from sources other than
Guatemala in order to identify the minimum and maximum price range for those imports and to
estimate the volume of those same imports (also w ith reference to SICMEX statistics pertaining to
imports from those other sources). 309 We therefore find that Guatemala has not established this
element of its allegation pertaining to the methodol ogy applied by Economía to calculate imports
from sources other than Guatemala.
7.287 Guatemala argues that this situation before us is essentially the same as the one found to
violate Articles 3.1 and 3.2 in the Mexico - Anti-Dumping Measures on Rice dispute, while Mexico
asserts that there is little similarity. We believe the facts before us differ from those in the Mexico –
Rice case. The differences include: (i) in the pr esent case, the methodology in question was used to
estimate import volumes for imports from countries ot her than Guatemala (a practically complete set
of actual data derived from "pedimentos" being avai lable in respect of Guatemalan product), while in
Rice the volume of dumped imports (including those from companies other than the participating

306 We find support for this approach in Appellate Body Report, Mexico - Anti-Dumping Measures on
Rice, para. 205.

307 See Exhibit GTM-23, paras. 167 and 168.

308 See supra, paras.7.268-7.271.

309 Specifically, Exhibit GTM-23, paragraph 167 indi cates that the "pedimentos" concerned were
"referred to in the previous point". Paragraph 166 refers to "pedimentos" corresponding to imports from sources
other than Guatemala. See also Exhibit GTM-23, para. 168. Exhibit GTM-23, para. 160, indicates that Tubac
had made a similar allegation before Economía and that Economía's position on this was "... as indicated in
points 122 to 126 of the preliminary resolution, account was taken of the minimum and maximum price of
imports of pipe identified as subject to investigation from countries other than Guatemala, on the basis of import
"pedimentos" supplied by customs agents; these were the prices used to estimate the import volumes from other
sources of the investigated product". Moreover, paras. 184-186 of the Final Determination indicate Economía's
view that the prices of imports from Guatemala were different from those of imports from other sources.

firms, and as opposed to those that were not dumped) was estimated using a sampling technique; (ii)
in the present case, trends were not extrapolated fro m one period to another, but rather samples (albeit
limited and of widely varying magnitudes) were available for each of the three six-month periods
concerned. That said, the basic conclusion of the Rice panel (upheld on appeal) – that the IA relied on
unfounded assumptions in reaching its conclusions as to the volume effects of the subject imports–
has a counterpart here in Economía's analysis of imports from sources other than Guatemala,
especially given the low coverage of the sample for the six-month period in 2000 and the exceedingly
low coverage of the samples for the 1998 and 1999 six-month periods, together with the inherent
imprecision of identifying the relevant products on the basis of price ranges.
7.288 For these reasons, we find that the methodology applied by Economía to estimate the volume
of imports from sources other than Guatemal a – i.e. reliance on limited samples of varying
magnitudes for the three relevant periods in 199 8, 1999 and 2000 as the basis for identifying the
ranges of minimum and maximum prices for the impor ts known to be of the re levant product, and on
the assumption that all imported products with prices within those ranges were investigated products –
was inconsistent with the requireme nts of Articles 3.1 and 3.2 of the Anti-Dumping Agreement to
conduct an objective examination of positive evidence.
(ii) Price effects

7.289 Guatemala initially asserted that, in evaluating the price effects of the imports from
Guatemala (and in particular the price of the imported product in the Mexican market), Economía
used a sample of only 17 per cent of the total of such imports for the period July-December 2000, and
did not examine the 1998 and 1999 periods. Acco rding to Guatemala, this resulted in an
inconsistency with Artic les 3.1 and 3.2 of the Anti-Dumping Agreement. Mexico disagreed with the
factual premise of Guatemala's allegation, arguing th at the 17 per cent sample was used only for the
purpose of estimating the charges for bringing the imported merchandise from the port of entry to the
Mexican customer's warehouse (rath er than for the overall price of the imported product in the
Mexican market). In its oral statement at the first Panel meeting
310, Guatemala asserted that it was not
clear from the Final Determination whether the 17 pe r cent sample pertained only to the charges for
bringing the imported merchandise from the port of entry to the Mexican customer's warehouse.
Subsequently, in response to questioning from the Panel about this factual discrepancy, Guatemala
maintained that even if the 17 pe r cent sample related only to certa in charges and not to the overall
price information taken into account to calculate the price of the imported product sold in the Mexican
market, its allegation relating to non-representa tivity and the limitation to one six-month period
remained valid. In particular, Guatemala alleged:
"... In Guatemala's view, Economía's argument is not a satisfactory response to the
questions about its price analysis. For exam ple, Guatemala takes issue with the fact
that having collected import ‘pedimentos’ for 100 per cent of the imports from
Guatemala, Mexico used only 17 per cent of the imports in calculating the price of
the imported good after entry (assuming also that, as Mexico says, the 17 per cent of
the sample refers solely to charges on imports ( gastos de internación )). In its reply
Mexico does not deny that Economía used onl y a part of all the information at its
disposal – only the import charges for the purpose of calculating the total internal
price of all the imported products. Nor does Mexico deny Guatemala's assertion that
although it had 100 per cent of the import ‘pedimentos’ for 1998 and 1999, it did not

310 Guatemala's first oral statement, para. 37.

determine the overall price ( precio nacionalizado) for the imported product for 1998
and 1999. Economía's analysis is therefore wrong".311 (footnote omitted)
7.290 The issues raised by the parties' argument s are addressed in paragraphs 186 and 190-194 of
the Final Determination. Paragraph 186 of th e Final Determination indicates how Economía
calculated the prices of the investigated product:
"... in order to estimate the prices for the pipe under investigation, the Ministry
calculated the average prices of the imports from Guatemala and those from other
sources of supply for the periods July -December 1998, 1999 and 2000 using the
figures for value and volume of the total im ports recorded in the SICMEX, adjusted
according to the methodology described in points 163 to 169 of this Resolution."
7.291 Paragraph 190 of the Final Determination, whic h deals with the comparison of import prices
and domestic prices, states:
"In order to compare the price of imports from Guatemala with the domestic price,
the Ministry added the value at point of en try of the investigated imports under tariff
items 7306.30.01 and 7306.30.99, the corresponding tariff and customs fees and the
import charges for taking the product to the importer's warehouse during the period of
investigation. These latter were calculated using the information supplied by the
importers registered by SICMEX that r esponded to the investigating authority's
request for information, including a number of Hylsa's customers. This information
for this stage of the investigation covered 17 per cent of the investigated imports from
Guatemala in the period July-December 2000." (emphasis added)
7.292 Paragraphs 191-194 of the Final Determination state:
"Furthermore, in order to estimate the pr ice of sale to the domestic market by
domestic producers, delivered at their customers' warehouses, the Ministry considered
only the information from the applicant and Tubería Nacional regarding delivery at
the customers' warehouses, since the other two domestic producers gave no
information on these charges. It is im portant to note that in the period of
investigation, Tubería Nacional and Hyl sa together accounted for 85 per cent of
domestic production of the investigated pipe.
On the basis of what is indicated under the two previous points, the Ministry observed
that in the period investigated, July-Dece mber 2000, the weighted average price of
the investigated imports from Guatemala, delivered at the importer's warehouse, was
13 per cent lower than the weighted averag e price at customer's warehouse of the
producers referred to under the previous point.
In addition, according to the section on price discrimination in this Resolution, in the
period July-December 2000 imports from Gu atemala to the Mexican market of the
investigated pipe under tariff items 7306.30.01 and 7306.30.99 entered with dumping
margins of 29.92 and 35.26 per cent, respectively.
On the basis of what is indicated in point s 182 to 193 of this Resolution, the Ministry
determined that the behaviour of the inv estigated imports and the increase in their
share of the Mexican market is a result of significant undercutting margins in relation
to the domestic price and the imports from other sources, reflecting the dumping

311 Guatemala's response to question 79 from the Panel.

margins found; the increase in the imports and the conditions in which they were
effected caused suppression of domestic prices."
7.293 We find, as a matter of fact, that the text of the Final Determination does not support
Guatemala's principal allegation on this matter. In particular, we read paragraph 186 as describing
how Economía established the prices of imports of the investigated product from Guatemala and from
other sources (for the three six month periods in 1998, 1999 and 2000), while paragraph 190 deals
with a comparison of prices of imported and domestic products, and indicates elements going into this
calculation, with an indication of the sample si ze relied upon. Specifically, we read the phrase
"[t]hese latter" in para. 190 of the Final Dete rmination as referring to charges for the imported
merchandise from the port of entry to the Mexican cu stomer's warehouse, rather than to all of the
elements relating to the price of the imported produc t from Guatemala. As a result, the term "[t]his
information" introducing the last sentence of this pa ragraph also refers to such charges. We have
doubts whether a sample of such magnitude could give an accurate reflection of such charges, and we
note that the information gathered relates only to the period from July-December 2000 (with no
indication of developments in 1998 and 1999). Nevertheless, we note the practical problems inherent
in data collection in an anti-dumping investigation in relation to certain elements of the injury
analysis, and Economía's experience in this respect (a s indicated in the Determination). We find that
the factual premise for Guatemala's principal allegation – i.e. that the 17 per cent sample from the six-
month period in 2000 related to Economía's calculati on of the price of the imported product from
Guatemala in Mexico rather than to only one co mponent element of that price ("import charges for
delivery of the product to the importer's warehouse") – is erroneous.
312
7.294 Guatemala only corrected its allegation in respect of the price effects of the imported product
– that is, to state that even if the 17 per cent samp le related to only "import charges for delivery of the
product to the importer's warehouse", an inconsistency nevertheless still resulted with Articles 3.1 and
3.2 in relation to the calculation of the import price for only the period July-December 2000 – in
response to a request for clarification from the Panel (we have cited their response above).
7.295 We are mindful that it is not for the Pane l to establish the complainant's case for the
complainant.313 In this respect, the limited (17 per cent) data in question was used to estimate only
one adjustment in the process of calculating the re levant price of the imported product in the Mexican
market for the purposes of the overall injury determination; and Economía did calculate the "average
prices of imports from Guatemala and from other s ources of supply for the periods July-December
1998, 1999 and 2000" (i.e. for each of the relevant periods over these three years) on the basis that we
have outlined above.314 That is, the record indicates that Economía did resort to the virtually 100 per
cent of the import "pedimentos" in respect of imports from Guatemala (as well as to that proportion of
"pedimentos" that it had received in respect of imports from other sources for the purposes relating to
estimating the value of the dumped imports) as outlined in paragraph 186 of th e Final Determination;
and Economía did outline problems it had experienced in respect of data collected from the domestic
industry in relation to the price comparison. Guatem ala did not substantiate before us why, despite
the correction that it had to make in its argumentatio n before us, it still considered that calculating the
adjusted price of imports from Guatemala onl y for the period July-December 2000 necessarily

312 In response to question 79 from the Panel, Guatemala maintained that even though the 17 per cent
related only to certain charges and not to the ov erall price information, its allegation relating to
non-representativity and the limitation to one six-month period remained valid.

313 We find support for our view in, e.g., Appellate Body Report, Japan- Agricultural Products II ,
para. 129.

314 Supra, para.7.290.

resulted in an inconsistency with Articles 3.1 and 3.2. 315 We therefore find that Guatemala has failed
to establish a prima facie case of inconsistency with Articles 3.1 and 3.2 in this respect.
5. Injury to the "domestic industry"316
(a) Arguments of the parties
(i) Guatemala
7.296 Guatemala argues that Economía's injury anal ysis was based on the selective and
inconsistent use of information pertaining to the domestic industry. Without any proper explanation,
Economía collected and relied upon data for part of its injury analysis referring to three of the
four companies that constituted the domestic industry, and for other parts of its analysis, data referring
to only one of those companies (that is, the petitioner).
7.297 In Guatemala's view, the selective and incons istent gathering and analysis of factors
indicating the state of the industry is contrary to the requirement in Article 3.1 to conduct an
"objective examination" of "positive evidence", and consequently to the requirements Articles 3.2,
3.4, 3.5 and 4.1.
(ii) Mexico
7.298 Mexico argues that it complied with its obligations under Article 3.1 to conduct an "objective
examination" of "positive evidence", and consequently with those under Articles 3.2, 3.4, 3.5 and 4.1.
Mexico asserts that Article 4.1 allows two mean ings for the term "domestic industry": (i) the
domestic producers "as a whole" or (ii) those who se collective output constitutes "a major proportion"
of the total domestic production. According to Me xico, an investigating authority can comply with
the "domestic industry" requirement by using either of those definitions, that is, by examining either
the domestic producers "as a whole" or those who se collective output constitutes "a major proportion"
of total domestic production. Mexico turns to Artic le 5.4 to inform its interpretation of the "major
proportion" element in Article 4.1, arguing that, if a producer alone satisfies the Article 5.4 threshold
of 50 per cent of the domestic industry expressing s upport or opposition to the application, then an
objective examination of injury factors may rely upon data pertaining solely to that producer.
7.299 In this case, Mexico contends, the data collect ed and analysed by Economía for the economic
injury factors pertained to three firms acc ounting for 88 per cent of domestic production.
Furthermore, as Hylsa accounted for 53 per cent of the domestic industry, and the whole of the
domestic industry supported the request for initiation, Mexico argues that Economía was justified in
collecting and relying upon financial injury data pertaining solely to the applicant.
(b) Arguments of the third parties
7.300 The European Communities endorses Guatemala' s assessment that Economía's injury
analysis, based on data relating to various combinations of information from various firms comprising
the domestic industry, was not coherent, and thus, in consistent with Article 3.1. According to the

315 Guatemala did not, for example, further address or substantiate this allegation in its rebuttal
submission, although it did further address its allegation relating to the methodology applied by Economía to
analyse the volume of imports from sources other than Guatemala.

 316 In response to question 59 from the Panel, Guatemala confirmed to us that it no longer pursues any
independent claim under Article 3.4 pertaining to Mexico's examination of the particular injury factors
enumerated in that provision.

European Communities, Mexico's Article 4.1 argument is not relevant, as Guatemala's allegation does
not relate to the representativity of the data, but rather to its incoherent and arbitrary use.
(c) Factual background
7.301 At the initiation phase, Economía defined the domes tic industry as consisting of four firms:
Tuberías Procarsa, Tubería Nacional, Compañ ía Mexicana de Tubos ("CMT") and Hylsa.
317 For the
purposes of the injury component of its Initiati on Determination, Economía relied upon information
from Hylsa pertaining to its own situation, as well as certain data pertaining to other firms in the
domestic industry included in Hyl sa's petition (sourced from CANACERO") 318, as well as SICMEX
statistics. More specifically, in terms of ec onomic injury indicators, Economía relied upon data
supplied by Hylsa, and SICMEX statistics 319 to analyse national apparent consumption 320, as well as
on data supplied by Hylsa sourced from CANACERO 321, to analyse domestic production; total,
domestic and export sales; installed capacity; and invent ories. In terms of financial injury factors,
Economía focused on the situation of Hylsa, based on audited financial statements and data submitted
by Hylsa322, while also focusing on the situation of Hylsa-DAT.323 More specifically,
"... the Ministry calculated the percentage share of income from sales of standard pipe
in the applicant's total sales in order to ascertain the influence of these sales on
Hylsa's profits. The investigating authority noted that the percentage share was 3 per
cent in 1998, 1999 and 2000, which is why there was a preliminary determination that
sales of the like product had little influence on the applicant's financial situation.
For this stage of the investigation, the i nvestigating authority decided to conduct an
analysis of the applicant's financial situ ation and the operating results of the like
product for the years 1998 to 2000; it t ook into account Hylsa's audited basic
financial statements for the years 1998 to 2000, the value and volume indicators and
the statement of costs, sales and profits of the like product for those same years, and
the period of investigation and the two comp arable previous periods. It should be
noted that in the interests of financial compatibility, the Ministry updated the
financial data using the changes in general price level method ...".
324
7.302 In order to support the asserted deterior ation of Hylsa's financial situation 325, Hylsa had also
submitted:

318 Exhibit GTM-4, paras. 82-83. In order to calculate the price in the Mexican market at the initiation
phase, Economía based itself on the information submitted by the applicant on sales prices, sourced from
CANACERO, as well as figures on its sales volume and value. See Exhibit GTM-10, para. 111.

319 Exhibit GTM-4, para. 116.

320 Exhibit GTM-4, para. 118.

321 Exhibit GTM-4, para. 119.

322 Exhibit GTM-4, paras. 129-131, 132-154.

323 Exhibit GTM-4, paras. 132-134.

324 Exhibit GTM-4, paras. 130-131.

325 Exhibit GTM-4, para. 133.

"… a statement of results entitled "Hylsa- DAT"; however, on the basis of the
methodology described in the reply to the request addressed to it by the IA, and an
analysis of the numerical operations in a wo rksheet entitled ‘Statement of costs, sales
and profits of the domestic product’, submitted by the applicant, the Ministry
concluded that the Hylsa-DAT statement of results, to which the applicant refers,
actually corresponds to the operating results of the like product. It therefore decided
at this stage of the investigation to evaluate only the results of the like product
together with those of the applicant as a whole."
326
7.303 On this basis, Economía analysed the operating profits of the applicant and of the "like
product". Economía also analysed the return on investment 327; capital flow 328; ability to raise
capital329; other injury factors. 330 On the basis of its analysis, the Secretaría concluded that initiation
was warranted.331
7.304 For the preliminary phase, Economía requested information from the three companies other
than the applicant that constituted the domestic industry (Tuberías Procar sa, Tubería Nacional and
Compañía Mexicana de Perfiles y Tubos) 332 as well as from CANACERO. 333 In particular, it
requested information pertaining to the principal economic indicators of these companies for 1998,
1999 and 2000.334,335 At this stage, Economía also requested certain clarifications from the petitioner
regarding its data on financial indicators.336 In particular:
"... the inconsistencies between the statement of results of Hylsa's Division of Steel
Tubing furnished in the applicant's reply a nd the statement of costs, sales and profits
of the like product supplied in answer to the ‘prevención’ (Annex 8) prompted the

326 Exhibit GTM-4, para. 134.

327 Exhibit GTM-4, paras. 140-146.

328 Exhibit GTM-4, paras. 147-149.

329 Exhibit GTM-4, paras. 150-154. Economía also an alysed "threat of injury", not at issue in this
dispute.

330 Exhibit GTM-4, paras. 166-170.

331 Exhibit GTM-4, para. 171.

332 For the preliminary phase, CMT had been considered as CMPT. Exhibit GTM-23, para. 131(A).

333 Exhibit GTM-10, para. 39.

334 Exhibit GTM-10, para. 105. See Economía's request s for information, dated 17 December 2001, to
Tuberías Procarsa, Tubería Nacional and Compañía Mexicana de Perfiles y Tubos. These requests asked, in
particular, for "information on the following economic indicators for black and galvanized standard pipe
manufactured in 1998, 1999 and 2000: production, sales to the domestic market, sales abroad, own
consumption, inventories, employment, price of sale to the domestic market and installed production capacity
…".

335 Procarsa was the only company that did not respond to this request for information. Exhibit GTM-
10, para. 106.

336 Exhibit GTM-10, para. 169.

Ministry to seek clarification. However, the applicant's reply provided no certainty
regarding the data in the statement of costs, sales and profits of the like product. The
investigating authority therefore determin ed that the analysis of the financial
variables referred to the narrower range of products, i.e. Hylsa's Division of Steel
Tubing. It is also clarified that the information the applicant supplied on that division
is expressed in annual terms, so in the next phase the Ministry will obtain information
from Hylsa's Division of Steel Tubing corresponding to the period of investigation
and comparable previous periods.
The Ministry examined the applicant's fina ncial situation to determine whether there
is any evidence allowing the c onclusion that the impact of the subject imports had a
significant effect on the financial variables of the domestically manufactured like
product, standard pipe. For this purpose it took into account the applicant's audited
basic financial statements for 1998 to 2000 , the economic indicators for both value
and volume and the specific statement of r esults of Hylsa's Division of Steel Tubing
which the applicant provided in annual terms. For the sake of financial
comparability, the Ministry updated the in formation using the changes in general
price level method …".
337
7.305 In its Preliminary Determination, Economía defined the domes tic industry as comprising four
firms: Tuberías Procarsa, Tubería Nacional, Compañía Mexicana de Tubos and Hylsa. 338 In reaching
its Preliminary Determination, Economía calcula ted the weighted average price of the domestic
industry in the domestic market on the basis of info rmation furnished by Hylsa, Tubería Nacional and
CANACERO.339 It also analysed certain economic indicators, inter alia : national apparent
consumption using information from Hylsa, the SICMEX and CANACERO 340; installed capacity
figures using information of Hylsa and Tubería Nacional 341; and inventories using information of
Hylsa and Tubería Nacional. 342 Concerning its analysis of the financial variables, Economía used
financial information not only from Hylsa, but also from Hylsa's Division of Steel Tubing, Hylsa-
DAT, on the basis outlined above343 Economía concluded:
"On the basis of the indications in points 165 to 181 of this Resolution, the Ministry
concluded that the operating profits of Hyl sa and its Division of Steel Tubing showed
a decline in 2000 because of the fall in total sales income. This adversely affected the
operating margin of the company and its Division of Steel Tubing, as well as the
latter's return on investment and its contri bution to that return in 2000. Hylsa was
also adversely affected in terms of its ability to raise capital given its reduced

337 Exhibit GTM-10, paras. 169-170.

338 Exhibit GTM-10, para. 107.

339 Exhibit GTM-10, para. 146.

340 Exhibit GTM-10, paras. 150, 152 and 153.

341 Exhibit GTM-10, para. 160.

342 Exhibit GTM-10, para. 161.

343 Exhibit GTM-10, paras. 169-170; see paras. 171-182 for Economía's analysis of financial
indicators.

operating cash flow and operating profits, and its increased level of financial
indebtedness."344
7.306 For the purposes of its Final Determination, Ec onomía again requested information from the
responding companies other than Hylsa (Tubería Nacional and Compañía Mexicana de Perfiles y
Tubos) to corroborate whether the information on their economic indicators referred to the
specifications, lengths, diameters and wall-thicknesses of the investigated product as it was defined at
that time.
345 Economía also requested information from Compañía Mexicana de Tubos on its
economic indicators corresponding to the specifications length, diameters and wall-thicknesses of the
investigated product as it was defined at that ti me. The Final Determination indicates that, in
response to this information request, Tubería Naciona l indicated that the economic injury data it had
submitted pertained only to the product as defined (in schedules 30, 40 and 80) while Compañía
Mexicana de Tubos indicated that it produced the product as defined only in schedule 40 and
submitted economic injury data.
346
7.307 In the Final Determination, Economía defined the domestic industry as consisting of four
firms: Tuberías Procarsa, Tubería Nacional, Compañía Mexicana de Tubos and Hylsa.347
7.308 In reaching its Final Determination, in respect of economic injury factors, Economía used
information of three companies: Hylsa, T ubería Nacional and Compañía Mexicana de Tubos. 348
These companies together represented 88 per cent of the domestic industry. 349 On this basis,
Economía decided that the trends in these compan ies' economic factors were representative of the
domestic industry.350 In particular, on the basis of this information, Economía analysed:
• the national production oriented to the domestic market351,
• sales to the domestic market352,

344 Exhibit GTM-10, para. 182.

345 Exhibit GTM-23, para. 139 and Exhibit 18, (Oficio UPCI.310.03.1912/2 and Oficio
UPCI.310.02.1867/2), respectively.

346 Economía's treatment of CMT and CPMT somewhat confusing. In any event, Economía explained
that it had not received such information before this fi nal stage since Hylsa had furnished the wrong address for
this company. Exhibit GTM-23, para. 140 and Exhibit 18, (Oficio UPCI.310.02.1498/2). Furthermore, CMPT
indicated that it did not produce the product as defined. Exhibit GTM-23, para. 142. Economía further
indicated in para. 145 that "… not a part of the domestic industry, Compañía Mexicana de Perfiles y Tubos,
which stated that it does not manufacture the product being investigated." Thus, by the time of the Final
Determination, CMT formed part of the domestic industry and CMPT did not.

347 Exhibit GTM-23, para. 145.

348 Exhibit GTM-23, para. 201. The Final Determina tion also indicates, in para. 148, that, in the
context of considering whether or not Hylsa had standing to initiate the investigation, Economía observed that
Hylsa had brought to its attention three other domestic pr oducers that produced "structural tubing manufactured
to standard ASTM A500 in schedule 40". Economía observed: "However, the production of this tubing by
these producers is not significant ...". It is clear that these other domestic producers were not included in the
domestic industry as defined by Economía for the purposes of its injury determination.

349 Exhibit GTM-23, para. 201.

350 Exhibit GTM-23, para. 201.

351 Exhibit GTM-23, para. 204.

• domestic production for the export market
353,
• installed capacity354,
• inventories355, and
• employment.356
7.309 In respect of its analysis of financial injury factors, Economía used information either for
Hylsa (the company as a whole), and/or for Hylsa and its Division of Steel Tubing, Hylsa-DAT.
Economía had determined that "the applicant' s output accounted for a large part of domestic
production, amounting to 53 per cent of domestic production of the investigated pipe".
357 Economía
indicated:
"For the purpose of the preliminary resoluti on, the Ministry decided to analyse the
results of Hylsa-DAT and of the company as a whole on the basis of the information
available. At this phase of the investig ation, Hylsa provided the Ministry with a
statement of costs, sales and profits, but it does not tally with the sales in value
recorded in the company's indicators for the investigated product.
Also at this phase of the investigation, Hyl sa provided the statements of results of the
Division of Steel Tubing (Hylsa-DAT) for the first and second semesters of 1998,
1999 and 2000, and the Ministry deemed these ad equate for an analysis of the profits
and profitability of the Division of Steel Tubing.
Taking account of the information set out in the point above and Hylsa's audited basic
financial statements for 1998 to 2000, th e value and volume economic indicators, and
the statement of costs, sales and profits of the like product for those same years, the
Ministry carried out an examination of the financial situation of the applicant
company Hylsa for the years 1998 to 2000 and of Hylsa-DAT for those same years
and the period of investigation and two comparable previous periods; the latter
information pertained to the more restrict ed range, which included the like domestic
product."
358
7.310 Thus, for the analysis of the ability to rai se capital Economía used information for Hylsa 359,
and for the following indicators, Economía used information for both Hylsa-DAT and Hylsa:
• profits360,

352 Exhibit GTM-23, paras. 205 and 206.

353 Exhibit GTM-23, para. 207.

354 Exhibit GTM-23, paras. 208 and 209.

355 Exhibit GTM-23, para. 210.

356 Exhibit GTM-23, para. 210.

357 Exhibit GTM-23, para. 146.

358 Exhibit GTM-23, paras. 214-216.

359 Exhibit GTM-23, paras. 234 to 236.

360 Exhibit GTM-23, paras. 218, 221 to 224.

• return on investment 361, and
• cash-flow.362
7.311 In terms of the data pertaining to Hylsa and Hylsa-DAT, respectively, Economía stated:
"Based on the foregoing, below are the results of the examination of the financial
situation of the company Hylsa and of the Division of Steel Tubing.
The Ministry calculated the share of the in come generated by the total sales of the
investigated tubing in the income of Hy lsa-DAT, the result of this exercise showed
that in 1998 it amounted to 37 per cent, and to 36 and 33 per cent in 1999 and 2000
respectively. The Ministry accordingly determ ined that sales of the investigated pipe
have a significant influence on Hylsa-DAT's financial situation. It further determined
that the total income of the Division of Steel Tubing amounted on average to an 8 per
cent share of the applicant company's total sales between 1998 and 2000".
363
7.312 Mexico confirmed to us that Economía did not request, at any time during the investigation,
information on the financial indicators of any of th e companies that composed the domestic industry,
other than Hylsa (and, within Hylsa, its division Hylsa-DAT).364
(d) Evaluation by the Panel
7.313 Based on the parties' evidence and arguments, the question before us is whether Economía
made an objective examination based on positive ev idence, as required by Articles 3.1, 3.2, 3.4 and
3.5, in its collection and evaluation of data pertaini ng to injury to the "domestic industry" as that term
is defined in Article 4.1.
7.314 Economía defined the domestic industry for the purposes of the Final Determination 365 as
being constituted of four firms: Hylsa, Tuberías Procarsa, Tubería Nacional y Compañía Mexicana de
Tubos. This was the domestic industry defined by Economía for the purposes of the injury
analysis.
366 However, Economía's analysis of the economic and financial indicators was based on sets

361 Exhibit GTM-23, paras. 218, 225 and 226.

362 Exhibit GTM-23, paras. 218, 227 to 233.

363 Exhibit GTM-23, paras. 219-220.

364 Mexico's response to question 64 from the Panel.

365 Exhibit GTM-23, para. 145. Definition of domestic industry at initiation phase: Exhibit GTM-4,
para. 82; definition of domestic industry at Preliminary Determination phase: Exhibit GTM-10, para. 107.

366 Economía had concluded, in its Final Determination analysis of "standing" for the purpose of
initiation of the investigation, that three other domestic pr oducers (who had not participated in the investigation
but had been brought to Economía's attention by Hylsa at the final stage of the investigation) had "not
significant" production of "structural tubing manufactured using standard ASTM A500 in schedule 40". Having
found that the production of these non-participating companies was "not significant", Economía did not include
their production as part of the domestic industry in its injury analysis. Referring to these three non-participating
companies, Economía stated "... in this phase of the investigation, as well as the companies that make up the
major part of domestic production of the investigated tubing ..." (emphasis added), implying that the domestic
industry it defined for the purposes of its injury investigation was a major proportion of domestic production,
rather than the domestic industry "as a whole". In Economía's view, inclusion of these producers would not
have materially changed its view that the "standing" requirement for initiation was fulfilled, or that Hylsa
accounted for "a major proportion" (" una parte importante ") of domestic production. See paras. 148-149 of

of information that at no point referred to the w hole industry as this had been defined by Economía.
For the purpose of the injury analysis in the Fi nal Determination, Economía relied upon information
on the economic indicators of three firms constituting 88 per cent of the domestic industry.
367
Regarding financial informati on, Economía only sought and relied upon information accounting for
53 per cent of the domestic industry, from Hylsa and/or its Tubing Division, Hylsa-DAT.368
7.315 Therefore, the specific issue that arises befo re us on the facts of this case is whether
Economía's collection and reliance upon economic inju ry data relating to three firms constituting
88 per cent of national production, and financial injury data pertai ning to only one firm constituting
53 per cent of national production was consistent with Mexico's obliga tions under Articles 3.1, 3.2,
3.4 and 3.5 concerning the determination of injury to the "domestic industry" as that term is defined in
Article 4.1.
7.316 At the outset, we wish to emphasize our understandi ng that the issue before us, as raised by
Guatemala, does not include the consistency with the c ited provisions of Economía's reliance upon
financial injury data pertaining to both Hylsa and Hylsa-DAT. In our view, Economía's reliance on
data of both Hylsa and Hylsa-DAT could introduce considerable distortions into the injury analysis, as
the record indicates that Hylsa- DAT revenue accounted for 8 per cent of Hylsa's total sales from
1998-2000.369 The record further indicates that Ec onomía considered Hylsa and Hylsa-DAT's
information together for the purposes of its financial injury analysis. Apart from indicating that
Economía analysed the financial information of Hy lsa and Hylsa-DAT in accordance with standard
accounting principles370, we find no clear indication in the record as to how Economía ensured that it
took Hylsa-DAT's financial performance into account only once, that is, on its own, and not also
again as part of Hylsa's overall financial performance. Mexico has certainly not clarified how and the
extent to which Economía reduced the possibility of "double-counting" of Hylsa-DAT's experience as
part of the domestic industry. We are left unc lear as to how the experience of Hylsa-DAT, which
accounted for a relatively small proportion of Hylsa' s overall sales, could have been reflective of
Hylsa's overall situation. 371 However, although Guatemala mak es reference to the use by Economía
of various combinations of companies as sources of information, it does not specifically identify the
use of Hylsa and/or Hylsa-DAT's information as a specific issue for our consideration. 372

Exhibit GTM-23, the Final Determination. The proportion of the "domestic industry" – as this was defined by
Economía – accounted for by Hylsa was the main basis fo r Mexico's argument before us that Economía was
entitled to seek out financial injury data only from Hylsa (and Hylsa-DAT), and not from the other firms
constituting the "domestic industry" as this had been defined by Economía. For this reason, we do not consider
that Economía's treatment of these three producers with production that was "not significant" materially affects
our analysis here. That is, whether the domestic industry, as defined by Economía, at the outset constituted the
domestic industry "as a whole" or "a major proportion th ereof" does not change the nature of our analysis,
which focuses on the treatment of this "domestic industry" – once this had been defined by Economía for the
purposes of its injury analysis. We note, in an y event, that Guatemala has not challenged Economía's definition
of the domestic industry used for the purposes of its injury analysis.

367 Exhibit GTM-23, para. 201.

368 Exhibit GTM-23, paras. 215 and 216.

369 Response to question 81 from the Panel.

370 Exhibit GTM-23, para. 217.

371 See, for example, Exhibit GTM-23, para. 238.

372 See, for example, Guatemala's first written submission, paras. 276-277; Guatemala's response to
question 168 from the Panel; Guatemala's rebuttal submission , e.g. para. 133. In para. 277 of its first written
submission, Guatemala asserts: "... while the financia l performance of the applicant and of Hylsa-DAT is

Accordingly, our findings below are without prejudice to our views on this issue. As regards Hylsa
and Hylsa-DAT, the issue before us focuses upon th e consistency with the cited provisions of
Economía's approach in seeking a nd relying upon data relating to no more than 53 per cent of the
domestic industry for the purposes of its analysis of financial indicators in its injury analysis.
7.317 In addressing the issue before us, we first consider Mexico's main justification for Economía's
approach.
7.318 Mexico argues that, in respect of the various injury factors, Economía was justified in
examining data relating either to all (or almost all) of the domestic industry, or to "a major
proportion" thereof. 373 According to Mexico, this was consistent with the Article 4.1 definition of
"domestic industry", as either the totality or "a major proportion" thereof. Regarding the analysis of
economic injury indicators, Mexico argues that the use of data from three firms covering 88 per cent
of national production was "represent ative" of the domestic industry. 374 In respect of the "major
proportion" element, Mexico invokes Article 5.4 of the Anti-Dumping Agreement, which sets out the
"standing" rule and threshold per centages for initiation of an inves tigation "by or on behalf of the
domestic industry". According to Mexico, because Hylsa alone represented 53 per cent of the
domestic industry – that is, more than the 50 per cen t threshold set out in Article 5.4 – then an
objective examination of injury factors could rely upon data pertaining solely to that producer. 375 In
Mexico's view, this is sufficient to consider that th e result of such an analysis reflects the situation of
the domestic industry.376
7.319 Guatemala counter-argues that Article 5.4 relat es to the "standing" requirement to initiate an
investigation whereas Article 4.1 defines the meaning of "domestic industry" "for the purposes of the
Agreement".
7.320 We recall the relevant legal framework for our anal ysis. We have already cited the text of the
relevant provisions of Article 3 a nd of Article 4.1 above. Article 3. 1 requires that a determination of
injury shall be based on pos itive evidence and involve an objective examination of, inter alia, the
impact of the dumped imports on the domestic produ cers of the like product. Article 3.4 provides for
an examination of "the impact of the dumped imports on the domestic industry concerned shall
include an evaluation of all relevant economic factors and indices having a bearing on the state of the
[domestic] industry..." (emphasis added) and Article 3.5 states that "It must be demonstrated that the
dumped imports are, through the effects of dumping, as set forth in paragraphs 2 and 4 , causing
injury...to the domestic industry" (emphasis added). The focus of an injury determination is thus the
state of the " domestic industry", as that term is defined in Article 4.1. The title of Article 4 of the
Anti-Dumping Agreement is "Definition of domestic industry". The term "domestic industry" is
defined in Article 4.1, which reads, in part:

relevant to assessing injury, equally important is the financial performance of the other components of the
domestic industry and the domestic industry as a whole …".

From this assertion, we understand Guatemala's co mplaint to be primarily focused on the fact that
Economía did not seek out financial injury data from domestic firms other than Hylsa/Hylsa-DAT.

373 For example, response to question 66 from the Panel.

374 Exhibit GTM-23, para. 201.

375 Response to questions 67 from the Panel and Mexico first written submission, para. 213.

376 Response to questions 67 from the Panel and Mexico first written submission, para. 216.

"For the purposes of this Agreement, the term "domestic industry" shall be interpreted
as referring to the domestic producers as a whole of the like products or to those of
them whose collective output of the products constitutes a major proportion of the
total domestic production of those products ...".
7.321 The provision in Article 4.1 and footnote 9, wh ich defines injury as "material injury to a
domestic industry,[…] interpreted in accordance with the provisions of [this] Article [3]", inescapably
requires the conclusion that the domestic industry w ith respect to which injury is considered and
determined must be the domestic industry as defined in accordance with Article 4.1.
377 It follows that
an anti-dumping injury determination is, in fact, a determination that the domestic producers "as a
whole", or a "major proportion" of them, are "injur ed". Indeed, the concept of "domestic industry" is
critical to an injury determination, as it defines the framework for data collection and analysis.
7.322 Article 4.1 defines the domestic industry in two ways, either as "referring to the domestic
producers as a whole of the like products" or "to those of them whose collective output of the
products constitutes a major proportion of the total domestic production of tho se products". The text
of Article 4.1 indicates no hierarchy of preference between these two options. However, this does not
lead us to conclude that an investigating authorit y is permitted to switch back and forth between these
two possibilities in the course of a single injury an alysis (or to oscillate back and forth between
various allegedly "major proportions" of the domes tic industry in the course of the same injury
analysis). Article 4.1, and in particular the term "a major proportion", permits a degree of flexibility
in defining the domestic industry or "major proporti on" thereof, but once an investigating authority
has identified the framewo rk for its analysis - whether an entire domestic industry or a major
proportion thereof - it must use this identified frame work consistently and coherently throughout an
investigation.
7.323 Article 5.4 reads:
"An investigation shall not be initiated pur suant to paragraph 1 unless the authorities
have determined, on the basis of an exam ination of the degree of support for, or
opposition to, the application expressed by domestic producers of the like product,
that the application has been made by or on behalf of the domestic industry. The
application shall be considered to have been made "by or on
behalf of the domestic industry" if it is supported by those domestic producers whose
collective output constitutes more than 50 pe r cent of the total production of the like
product produced by that portion of the domestic industry expressing either support
for or opposition to the application. Ho wever, no investigation shall be initiated
when domestic producers expressly suppor ting the application account for less
than 25 per cent of total production of the like product produced by the domestic
industry." (footnotes omitted)
7.324 The introductory clause of Article 4.1 indicates that the definition of "domestic industry"
applies "[f]or the purposes of this Agreement", i.e. throughout the Agreement. It would therefore also
define the term "domestic industry" as used in Ar ticle 5.4. Article 5.4 commences with the phrase:
"An investigation shall not be initiated pursuant to paragraph 1 unless ...". This is a clear textual
indication that Article 5.4 sets out a fundamental requirement that must be respected in initiating an
investigation.
378 However, as we have concluded that Ar ticle 4.1 does not permit an investigating

377 We note that the Panel Report, Mexico - Corn Syrup, para. 7.147, expressed a similar view.

378 The importance of this initiation requirement has been consistently highlighted in WTO dispute
settlement. E.g. Appellate Body Report, US – Offset Act (Byrd Amendment) paras. 282, 289; Panel Report, US
– 1916 Act (Japan), para. 6.261 (upheld on appeal).

authority in the course of a single injury analysis to switch back and forth between the two possible
definitions of "domestic industry" – i.e. (i) the do mestic producers as a whole of the like products; or
(ii) those of them whose collective output of the products constitutes a major proportion of the total
domestic production of those products – we do not believe that Article 5.4 is strictly germane to the
issue before us. This is because the issue raised by Guatemala's claim is not the definition of the
domestic industry per se, or the identification of "a major proportion of" the domestic industry as the
"domestic industry" for the purposes of the injury an alysis. Rather, Guatemala's claim relates to the
consistency and representativeness of the data set reli ed upon by Economía in its analysis of the state
of the domestic industry, as this had been defined by Economía. 379 We therefore reject the relevance
of the legal premise underlying Mexico's argument pertaining to Articles 4.1 and 5.4.
7.325 We turn to the issue raised by Guatemala that Mexico violated Article 3.1 and other relevant
obligations in Article 3 as it did not use a consis tent and representative data-set pertaining to the
"domestic industry", as this was defined by Economía, in conducting its injury analysis. Within this
context, we consider whether Economía's collec tion and reliance upon economic injury data relating
to three firms constituting 88 per cent of national pro duction, and financial inju ry data pertaining to
only one firm constituting 53 per cent of national production was consistent with Mexico's obligations
under Articles 3.1, 3.2, 3.4 and 3.5 concerning injury to the "domestic industry" as that term is defined
in Article 4.1.
7.326 We are of the view that once an investiga ting authority defines which entities comprise the
domestic industry that will form the basis for its injury analysis, it should seek and use a consistent
data-set reflecting the performance of those entities. We understand that, in practice, an investigating
authority could have partial information to start an investigation, which might then be supplemented
as the investigation proceeds. An investigating au thority may also be con fronted with problematic
incomplete data furnished by one or more dom estic producers. In such a case, it should request
supplementary information, or, if that is not practicable, resort to a reasonable estimation
methodology which will yield results that are reflective of the state of the domestic industry. This is
because the requirement is to determine whether th e domestic industry, as defined, is injured by
dumped imports or not.
7.327 The requirement for an investigating authorit y to conduct an "objective examination" of
"positive evidence" under Article 3.1 means that it ca nnot examine parts of a domestic industry on an
inconsistent, arbitrary or selective basis. We reca ll the following statement of the Appellate Body in
US-Hot-Rolled Steel:
"We have already stated that it may be highly pertinent for
investigating authorities to examine a domestic industry by part,
sector or segment. However, as with all other aspects of the
evaluation of the domestic industry, Article 3.1 of the Anti-Dumping
Agreement requires that such a sectoral examination be conducted in
an "objective" manner. In our view, this requirement means that,
where investigating authorities undert ake an examination of one part
of a domestic industry, they should, in principle, examine, in like
manner, all of the other parts that make up the industry, as well as
examine the industry as a whole. Or, in the alternative, the
investigating authorities should provide a satisfactory explanation as
to why it is not necessary to examine directly or specifically the other
parts of the domestic industry. Different parts of an industry may

379 See, for example, Guatemala's first written submi ssion, para. 270. Guatemala asserted that, having
defined the domestic industry as consisting of four firm s, Economía should have based itself on the economic
situation of these four firms.

exhibit quite different economic performance during any given
period. Some parts may be performing well, while others are
performing poorly. To examine only the poorly performing parts of
an industry, even if coupled with an examination of the whole
industry, may give a misleading impression of the data relating to the
industry as a whole, and may overl ook positive developments in
other parts of the industry. Such an examination may result in
highlighting the negative data in the poorly performing part, without
drawing attention to the positive data in other parts of the industry.
We note that the reverse may also be true – to examine only the parts
of an industry which are performing well may lead to overlooking the
significance of deteriorating performance in other parts of the
industry.
Moreover, by examining only one part of an industry, the
investigating authorities may fail properly to appreciate the economic
relationship between that part of the industry and the other parts of
the industry, or between one or more of those parts and the whole
industry. For instance, we can envisage that an industry, with two
parts, may be overall in mild recession, where one part is performing
very poorly and the other part is performing very well. It may be that
the relationship between the two parts is such that the healthier part
will lead the other part, and the industry as a whole, out of recession.
Alternatively, the healthy part may follow the other part, and the
industry as a whole, into recession.
Accordingly, an examination of only certain parts of a domestic
industry does not ensure a proper evaluation of the state of the
domestic industry as a whole, and does not, therefore, satisfy the
requirements of "objectiv[ity]" in Article 3.1 of the Anti-Dumping
Agreement."
380
7.328 We are of the view that the Article 3.1 requi rement to base a determination of injury on
positive evidence and pursuant to an objective ex amination imposes certain obligations on an
investigating authority with regard to the consistency of the data collected and relied upon as the basis
for its determination. In brief, examining only a part of the industry as defined by the investigating
authority is not an objective examination of pos itive evidence since it is not representative of the
overall state of the domestic industry. The use of a consistent and representative data set will best
reflect the state of the domestic industry for the purpo ses of an injury analysis. We thus disagree with
Mexico's view that an IA may opt to limit its coll ection and evaluation of data in respect of certain
injury factors to only a certain part of the domestic industry as defined by it for the purposes of its
injury analysis.
7.329 Mindful of these considerations, we believe that Economía was required, by the explicit terms
of the Anti-Dumping Agreement, to determine the question of injury on the basis of a consistent data
set reflective of the state of the domestic industry, as it had defined it.
7.330 We recall the relevant facts that we have ou tlined above. For the Final Determination, in
respect of economic injury factors, Economía sought and relied upon data pertaining to three

380 Appellate Body Report, US-Hot-Rolled Steel , paras. 204-206. See also Panel Report, Mexico –
Corn Syrup, para. 7.154.

companies: Hylsa/Hylsa-DAT, Tubería Nacional and Compañía Mexicana de Tubos. 381 These
companies together represented 88 per cent of the domestic industry. 382 In particular, on the basis of
this information, Economía analysed and drew conc lusions about the state of the domestic industry in
respect of: the national production oriented to the domestic market 383, sales to the domestic market384,
domestic production for the export market385, installed capacity386, inventories387, and employment.388
7.331 However, in respect of its analysis of financ ial injury factors, Economía used information
only for the applicant (either for Hylsa SA or for Hylsa and its Division of Steel Tubing, Hylsa-
DAT). In particular, for the analysis of the ability to raise capital Economía used information for the
company as a whole 389, and for the following indicators, Economía used information for both
Hylsa-DAT and Hylsa: profits 390, return on investment 391, and cash-flow.392 Mexico confirmed to us
that Economía did not request, at any time during th e investigation, information on the financial
indicators of any of the companies that composed the domestic industry, other than Hylsa/Hylsa-
DAT, as it did not consider this to be necessary.
393 We recall and underline our view already
expressed above that Economía's reliance on data of both Hylsa and Hylsa-DAT could introduce
considerable distortions into the injury analys is, as the record indicates that Hylsa-DAT revenue
accounted for 8 per cent of Hylsa's total sales from 1998-2000. However, we again observe that this
particular issue is not specifically before us.
7.332 Thus, in respect of the economic injury factors, Economía sought information from four
companies and received and analysed information from three companies constituting 88 per cent of
the domestic industry. We are of the view that, under these circumstances, the use of such data might
have been reflective of the state of the domestic i ndustry in respect of those factors. However, in
respect of the financial indicators, we emphasize that Economía did not even attempt to seek
information from other firms constituting the domestic industry as Economía had defined it. 394 We
consider that Economía acted incons istently with its injury analysis obligations under Article 3 in
treating the partial financial data that it sought, acquired and anal ysed as a sufficient basis for its

381 Exhibit GTM-23, para. 201.

382 Exhibit GTM-23, para. 201.

383 Exhibit GTM-23, para. 204.

384 Exhibit GTM-23, paras. 205 and 206.

385 Exhibit GTM-23, para. 207.

386 Exhibit GTM-23, paras. 208 and 209.

387 Exhibit GTM-23, para. 210.

388 Exhibit GTM-23, para. 210.

389 Exhibit GTM-23, paras. 234 to 236.

390 Exhibit GTM-23, paras. 221 to 224.

391 Exhibit GTM-23, paras. 225 and 226.

392 Exhibit GTM-23, paras. 227 to 233.

393 Response to question 64 from the Panel.

394 Response to question 64 from the Panel.

determination in respect of such factors, and as a component of its overall injury analysis. Among
other things, there was no assessment as to how, or th e extent to which, Hylsa's financial performance
was reflective of, or better or worse than, the financial state of the rest of the domestic industry, as this
had been defined by Economía. Furthermore, Mexico has failed to provide any acceptable
justification regarding these gaps in the informa tion sought and received and then analysed in its
injury investigation. We note that there were only four firms comprising the domestic industry as
defined by Economía for the purposes of its injury analysis; in our view it would not have been
impracticable for Economía to have acquired fi nancial injury data from the remaining firms
constituting the domestic industry as defined by Economía.
7.333 We therefore conclude that Economía failed to conduct an objective examination on the basis
of positive evidence, as required by Article 3.1, of injury to the domestic industry as that term is
defined in Article 4.1, and consequently also violat ed Articles 3.2, 3.4 and 3.5, by failing to gather
and analyse representative and consistent data pertai ning to the domestic industry, in particular the
data concerning the financial indicators of the "domestic industry", as defined by it.
6. Article 3 claims relating to the scope of the investigated product/like product
(a) Arguments of the parties
(i) Guatemala
7.334 Guatemala asserts that changes in the defi nition of the product under investigation/like
product in the course of the investigation rendered the determinations of injury (and causal link)
inconsistent with Articles 3.1, 3.2, 3.4, 3.5 , 4.1 and 5.4.
(ii) Mexico
7.335 Mexico asserts that an IA has discretion to determine the scope of the product under
investigation and that Economía properly did so a nd complied with its obligations under Articles 3.1,
3.2, 3.4, 3.5, 4.1 and 5.4 relating to the determin ation of injury to the domestic industry (and causal
link).
(b) Arguments of the third parties
7.336 The European Communities supports Guatemala's claim on th e implications of the product
definition. In particular, a change in the prod uct definition in the Preliminary Determination (as
happened in this case) means that the information in the questionnaires that have been submitted is
incomplete, and the problem becomes worse wher e the change is only announced in the Final
Determination (as also happened here) – the data on which the determination is based have not been
subject to the investigative process.
7.337 Japan also supports Guatemala's arguments about th e implications of the product definition
(and changes thereto) for the injury determination: if the definition of the investigated product is
changed during an investigation, then the injury in vestigation also must be conducted on that revised
basis.
7.338 The United States generally agrees with Japan's obser vation that the Agreement permits
changes to the definition of the product under investig ation, but the IA must be cognizant of the broad
implications of such changes.

(c) Evaluation by the Panel
7.339 We address here Guatemala's allegation that the change in the definition of the product under
investigation/like product in the course of the i nvestigation to include tubing of 4"-6" and certain
structural tubing rendered the determinations of injury (and causal link) inconsistent with Articles 3.1,
3.2, 3.4, 3.5, 4.1 and 5.4 as there could not have been a valid assessment of the volume and price
effects of the imported product under consideration on the " domestic industry". According to
Guatemala, Economía lacked the evidentiary basi s to conduct an objective examination of positive
evidence and did not adequately explain how informa tion which it allegedly lacked in respect of the
products added to the scope of the definition had been taken into account in its injury analysis. We
underline that Guatemala's argumentation concentrat es on the alleged failure by Economía to gather
and analyse evidence pertaining to the products falling within the product scope following the two
adjustments to include tubing of 4"-6" and certain structural tubing in the product scope. 395
Furthermore, in response to Panel questioning, on its claim under Article 6.2, Guatemala clarified
that:
"the claim is based on the way in which Economía made various changes to the definition of
the product at issue so as to include, at a late stage of the investigation, additional products
which were originally excluded, without an y positive evidence on these products and without
having made any attempt to satisfy itself that they were properly investigated. Guatemala
accordingly has reiterated that its allegation is not concerned with whether or not the products
originally defined by Economía are similar to the products that were included in the definition
at a late stage …". 396 (footnote omitted)
7.340 We therefore understand that Guatemala makes no allegation in respect of any "dissimilarity"
between the scope of the product under investigati on, on the one hand, and of the like product, on the
other.397
7.341 We have set out above the factual background of the change in the definition of the product in
the course of the investigation to include tubing from 4"-6" and certain structural tubing 398, and our
factual findings in that regard. 399 We have also set out above the legal considerations governing an
investigating authority's analysis of injury under Article 3 to the domestic industry (as defined by
Article 4.1) producing the "like product" (as defined in Article 2.6).400
7.342 The immediate issue before us here is whether Guatemala is correct in alleging that Economía
failed progressively to reconcile the information it collected and analysed for the purposes of its injury
and causation analysis with the two changes in the product definition.

395 We refer to Guatemala's arguments in, for example, Guatemala's first written submission,
paras. 161-163; Guatemala's response to question 172 from the Panel; Guatemala's rebuttal submission,
paras. 59-73, especially paras. 60, 65.

396 Guatemala's response to question 173 from the Panel.

397 See supra, para. 7.105.

398 See supra,paras. 7.62-7.102.

399See supra, paras. 7.103-7.106.

400See supra, paras. 7.206-7.216.

7.343 It is clear that there must be identity between the product subject to the anti-dumping duty and
the product in respect of which a determination of dumping is made.
401 Similarly, injury and
causation must be assessed in respect of domestic produ cers of the "like product". In this respect, we
see nothing in Article 3, or elsewhere in the Agreemen t, that would prevent an investigating authority
from adjusting the definition of the product under i nvestigation or the "like product". Indeed, in
certain circumstances, it might be necessary or hi ghly appropriate for an in vestigating authority to
adjust or refine its product definition in light of information collected and analysed in the course of
the investigation that was not available to the IA at the time of initiation. We do not mean to suggest
that such adjustment or refinement could fundame ntally change the nature of the product under
investigation; rather it would clearly have to respect appropriate parameters. Such adjustments to the
definition of the product under investigation and/or like product might very well call for modifications
in the scope of data collected and analysed in or der to ensure a sufficient data set to fulfil the
Article 3.1 requirement to make an objective examination of positive evidence in reaching a
determination of injury. The requirement for investigating authorities to conduct an "objective
examination" of "positive evidence" under Article 3.1 means that investigating authorities must gather
and analyse evidence pertaining to the "dumped imports" as well as to the affected "domestic
industry" producing the "like product".
7.344 In respect of the extent to which Economía's co llection and analysis of injury data reflected
the first and second changes in product definition – i.e. the inclusion of 4"-6" tubing and certain
structural tubing – the record evidence we have described above indicates that, by the time of the
Final Determination, Economía had sought, from certain domestic producers, and the record included,
at least some economic and financial injury info rmation on the state of the domestic industry and
information on the volume and price effects of the dumped imports on the domestic industry 402
pertaining to a product definition that clearly included 4"-6" tubing and did not exclude certain
structural tubing.
403 Furthermore, as we have already noted , the record is clear (and Guatemala does
not contest) that by the end of the investigation, in addition to official SICMEX import statistics,
Economía had obtained import "pedimentos" coveri ng essentially 100 per cent of the subject imports
from Guatemala 404, and certain import "pedimentos" reflecting imports from sources other than
Guatemala, and thus had virtually comprehensiv e information concerning the product then being
imported from Guatemala and (less comprehensiv e) information on imports from other sources 405 that

401 E.g. Panel Report, US – Softwood Lumber V (Article 21.5 – Canada), para. 5.26.

402 The post-hearing Exhibit GTM-31 indicates that while Economía requested from Hylsa updated
injury data in respect of certain other potential adjustments to the product definition, it did not do so specifically
in respect of the inclusion of structural tubing at that juncture. Exhibit GTM-20, dated 6 September 2002,
indicates that Hylsa perceived the product as standard black and galvanized tubing with diameters of ½-6" "with
longitudinal weld and recognizable for conduction". However, the verification report (Exhibit GTM-24)
indicates that the verified injury information pertained to a product that included certain structural tubing.

403 We address the comprehensiveness of the overall da ta set gathered and analysed for the purposes of
Economía's analysis of injury to the "domestic industry" as defined by Economía elsewhere, see supra, paras.
7.313 ff.. We refer to and incorporate here our citations of passages from the Preliminary and Final
Determinations relating to the data acquired by Economía from the firms constituting the domestic industry,
supra, paras.7.301-7.312. We also recall our factual summary above relating to the changes in the product
scope and the information gathered from the domestic industry in that context; see, in particular, paras. 7.72,
7.77, 7.82, 7.92, 7.93 and 7.102.

404 Exhibit GTM-23, para. 164.

405 We do not address here Guatemala's allegations pertaining to the methodology applied by Economía
in respect of the volume of imports of the product under investigation from sources other than Guatemala. We
address those allegations elsewhere in this report. See paras. 7.264 ff.

it could use for the purposes of its injury and causat ion determinations. For the purpose of the Final
Determination, this "pedimento" data was reviewed in line with the product definition in the Final
Determination406 (i.e. including 4"-6" product and not excluding certain structural tubing).
7.345 Given this record evidence, we find that the fa ctual premise for Guatemala's allegations about
the collection and analysis of data on injury and causation in relation to the final product scope under
investigation and the domestic i ndustry producing the like product is not accurate. Given that this
factual premise underpins Guatemala's Article 3 alle gations, we are thus unable to conclude that
Guatemala has established that Economía violated Artic le 3.1, or, consequently, Articles 3.1, 3.2, 3.4
and 3.5 by failing to conduct an objective examina tion of positive evidence in respect of the data
collected and analysed in its determination of inju ry caused to the domestic industry (as defined in
Article 4.1) in light of the changes of the produc t definition to include 4"-6" tubing and certain
structural tubing.
7.346 We recall that Guatemala also asserted a violation of Article 5.4 in the context of its claims
and arguments relating to the change of product sc ope over the course of the investigation. That
Article provides:
"An investigation shall not be initiated pursu ant to paragraph 1 unless the authorities have
determined, on the basis of an examination of the degree of support for, or opposition to, the
application expressed by domestic producers of th e like product, that the application has been
made by or on behalf of the dom estic industry. The application shall be considered to have
been made "by or on behalf of the domestic industry" if it is supported by those domestic
producers whose collective output constitutes more than 50 per cent of the total production of
the like product produced by that portion of the domestic industry expressing either support
for or opposition to the application. However, no investigation shall be initiated when
domestic producers expressly supporting the application account for less than 25 per cent of
total production of the like product produced by the domestic industry. "(footnotes omitted)

7.347 Guatemala clarified407 that its Article 5.4 allegation was that "... changes to the definition of
the investigated product have repercussions on the de finition of the domestic industry and hence also
on the grounds for requesting initiation of an investigation. By not taking account of possible
repercussions of this kind when it broadened its definition of the investigated product, Economía
acted in a manner inconsistent not only with Article 4.1 but also with Article 5.4 of the Anti-Dumping
Agreement." It is thus clear that Guatemala's Ar ticle 5.4 allegation relates to changes in the product
definition after the initiation of the investigation. In our view, Article 5.4 pertains exclusively to
initiation, and there is no on-going obligation to monitor domestic industry support once an
investigation has been initiated under the Anti-Dumping Agreement. We thus disagree with the legal
premise underlying Guatemala's allegation (that post-initiation changes in product scope may be
challenged under Article 5.4). That being said, however, we can envisage situations in which a
radical change in the product definition may resu lt in involving entities additional to, or different
from, those that had supported the initiation of the investigation. A WTO Panel called upon to
scrutinize such a situation would have to do so very closely. However, in the case at hand, Guatemala
has not brought to our attention any shift in the co mposition of the domestic industry in terms of the
production of the like product occasioned by the expans ion of the scope of the investigation over its

406 See Exhibit GTM-23, para 165, in respect of imports from Guatemala: "On the basis of the
characteristics of the investigated product set forth in the product likeness section of this Resolution, an analysis
of the documentation gave the following results...". In respect of imports from other sources, para. 167 states:
"… the maximum and minimum prices of the imports id entified as investigated products were identified".

407 Guatemala's response to question 172 from the Panel.

course. Therefore, even assuming arguendo that Guatemala's legal premise was sustainable, the
record facts do not sustain Guatemala's claim.
7. Causation/non-attribution
(a) Arguments of the parties
(i) Guatemala
7.348 Guatemala argues that Mexico's analysis of the causal link between dumping and injury was
inconsistent with Articles 3.1, 3.2, 3.4 and 3.5 as it failed to analyse properly other known factors that
were causing injury to the domestic industry at the same time as the dumped imports, and failed to
ensure that injury caused by other known factors was not attributed to the imports under investigation.
In particular, Mexico did not properly take into acc ount and/or explain that a decrease in exports was
a factor causing injury and that that the reduction in operating profits resulted primarily from a cost
increase.
(ii) Mexico
7.349 Mexico asserts that Economía acted consistently with Mexico's obligations under Articles 3.1,
3.2, 3.4 and 3.5. According to Mexico, Gu atemala's vague arguments fail to establish a prima facie
case that the reduction in operating profits resulted pr imarily from a cost increase; that the Final
Determination makes no mention of a cost increase a nd, in any event, any such increase could not be
attributed to injury caused by dumped imports and was taken into account in the injury analysis of
profits. In respect of the decrease in exports, Mexi co asserts that Guatemala also fails to establish a
prima facie case. Mexico affirms that the Determination indicates that, due to the small relative
proportion of exports to total production, such decre ase could not have been a determining factor in
causing injury to the domestic industry.
(b) Arguments of the third parties
7.350 Japan and the United States assert that the failure to make an objective examination of
positive evidence within the meaning of Article 3.1 al so leads to a violation of Article 3.5 of the Anti-
Dumping Agreement.
(c) Evaluation by the Panel
7.351 In considering Guatemala's alle gations relating to causality and non-attribution, the question
to be addressed by this Panel under Articles 3.1, 3.2, 3.4 and 3.5 is whether an unbiased and objective
investigating authority could have treated two specifi c factors – cost trends and a decrease in exports
– in the manner that Economía did when analyzing injury and causality.
7.352 We have already cited the relevant obligations in Article 3 above. Briefly, in concert with the
Article 3.1 requirement of an "objective examinati on" of "positive evidence", Article 3.5 requires that
an investigating authority establish a "causal relati onship" between dumped imports and the injury to
the domestic industry. In the course of identifying this causal relationship, investigating authorities
are not permitted to attribute to dumped imports injuries caused by other factors which are injuring
the domestic industry at the same time. Critical to the effective operation of the non-attribution
obligation, and indeed, the entire causation analysis, is the requirement of Article 3.5 to "examine any
known factors other than the dumped imports which at the same time are injuring the domestic
industry", for it is the "injuries" caused by those "other" "known factors" that must "not be attributed"
to dumped imports.

7.353 We note that Guatemala has raised two allegedly "other known" causal factors in this context
– cost developments and a decrease in exports. We consider the consistency of Economía's treatment
of each of these factors in turn, below, in light of the requirements of causality and non-attribution set
out in the relevant provisions of Article 3.
(i) Costs

7.354 Guatemala argues that according to the Final Dete rmination, Economía attributed the decline
in Hylsa-DAT's operating profit during the period of investigation to a dec line in sales revenues and
an increase in "costos de operación" ("operating costs"). According to Guatemala, the Final
Determination indicates that those co sts continued to increase during 2000. 408 Guatemala states that
in the Final Determination, Economía considered the decline in sales revenue to be the principal cause
of the loss of profits, in spite of the fact that cost increases are a determinative factor in reduced
profits, given that profits are calculated as reve nues minus costs. Guatemala argues that Economía
failed to provide a reasoned and adequate explan ation as to how it ensured that injury from the
increase in costs was not attributed to the subject imports. Guatemala's argument thus is that
Economía acted inconsistently with Articles 3.1, 3.2, 3.4 and 3.5 of the Agreement by failing to
distinguish appropriately between the injury cau sed by the increase in operating costs (which,
according to Guatemala was an "other known fact or" causing injury) versus that caused by the
dumped imports; and by failing to perform any anal ysis to ensure that th e injury caused by the
increased costs was not attributed to the dumped imports.409
7.355 Mexico argues that contrary to Guatemala's assertion, the Final Determination makes no
reference to an increase in "costos", and Mexico denies that there was any such increase. Mexico
argues that in fact "costos operativos" dec lined during the period of investigation. 410 According to
Mexico, therefore, Guatemala failed to establish a prima facie case in respect of this claim.
7.356 We note that central to this claim is a factua l disagreement between the parties as to whether
the Final Determination indicates that Hylsa-DAT's operating costs increased during the period of
investigation. We thus start our analysis by considering the portion of the Final Determination -
paragraphs 221 and 224 - to which Guatemala refers in its First Written Submission in respect of this
claim:

"221. In addition, on the basis of Hylsa-DAT's six-monthly statements of results,
those for the years 1998 to 2000 were obtained. They showed that in 1999 the
applicant recorded a 14 per cent drop in operatin g profits owing largely to a decline
of just over 5 per cent in sales revenue and a 10 per cent increase in operating
expenses; for the year 2000, the company's operating profits dropped 51 per cent as a

408 First written submission of Guatemala at paragraph 309, citing paragraphs 221 and 224 of the Final
Determination (Exhibit GTM-23).

409 Guatemala's response to question 170 from the Panel.

410 Mexico also argues that, by definition, an in crease in costs can not be attributed in any way to the
injury caused by dumped imports. First written submission of Mexico, at paragraph 261(b). We understand this
to be a response to Guatemala's argument that Economía did not explain "how it ensured that this increase in
costs was not attributed to the injury caused by the du mped imports" (First written submission of Guatemala at
paragraph 310). On the basis of Guatemala's further development of the arguments regarding this claim, we
understand Guatemala to be claiming that injury caused by increased costs was improperly attributed to the
subject imports.

result of the 7 per cent decline in the co mpany's total revenue, while there were
practically no variations in the cost of goods sold." (emphasis added)
[…]
224. Moreover, in the comparable period prior to the period of investigation, July-
December 1999, Hylsa-DAT
's operating profits posted a decline over the previous
comparable period owing to the fact that th e cost of goods sold increased 15 per cent,
while the Division's total revenue grew 8 per cent; this adversely affected the
operating margin, which dropped 4-1/2 percen tage points, to 9 per cent. For the
period of investigation, July-December 2000, the operating profit fell 79 per cent
because the Division's sales revenue dropped 19 per cent and operating expenses rose
6 per cent, which was reflected in a 7 percentage point drop in Hylsa-DAT's operating
margin, to 2 per cent." (emphasis added)
7.357 Guatemala's argument – as presented in its First Written Submission – appears to be based on
the references in the above p assages to increases in "operating expenses" ("gastos de operación")
during the POI. Given Mexico's denial that any in crease in "operating costs" ("costos operativos")
took place, we asked Mexico to clarify why an in crease in "gastos operativos" did not result in an
increase in "costos operativos". Mexico responded by providing a schematic financial statement,
reproduced below, which defines the terms us ed in the Final Determination as well as the
relationships among those terms.411
Operation Heading Explanation
A Net sales Net sales revenue
B Cost of goods sold The cost of goods sold includes the cost
of manufacture, raw material, labour,
indirect manufacturing expenses, initial
and final inventories of: raw material,
production in process and finished
product.
C = A-B Gross profit The result of subtracting the cost of goods
sold from sales income.
D Selling expenses The expenses a company incurs in putting
the product on sale.
E Administrative expenses Usually consists, inter alia, of salaries of
administrator, manager, payment of office
services.
F = D+E Operating expenses The result of adding sales expenses and
administrative expenses.
G = B+F Operating cost The result of adding cost of goods sold
and operating expenses.
H = A-G Operating profit The result of subtracting operating cost
from sales revenue.

7.358 The above table makes clear that in Mexico's terminology "operating expenses" ("gastos
operativos") are not the same thing as "operating costs" ("costos operativos"), and indeed are a
component of operating costs, the other component being "cost of goods sold" ("costo de ventas").
We note that, as Mexico argues, cost of goods sold would typically be the major component of

411 Mexico's response to question 85 from the Panel.

operating cost, given that it comprises all direct and some indirect costs (materials, labour, and
manufacturing costs), while operating expenses comp rise selling and administrative expenses. We
thus agree with Mexico that the influence on profit s of one or another component of total operating
cost will depend upon the relative magnit udes and movements of these components. 412 In this regard
we take note of Mexico's arguments that what paragraph 224 of the Final Determination refers to is an
increase in "operating expenses", not "operating costs" during the POI (i.e., July-December 2000), and
that an increase in the former do es not necessarily mean that there will be an increase in the latter
because of their different relative magnitudes, and because cost of goods sold could move in the
opposite direction. We also note Mexico's argument before us that as a factual matter Hylsa-DAT's
cost of goods sold declined by 13.2 per cent dur ing the period of investigation. The Final
Determination does not refer to this fact.413
7.359 Guatemala responds to this argument by sta ting that because the Final Determination
indicates that, in percentage terms, the 19 per cent decline in sales revenue was smaller than the
79 per cent decline in operating profits, there must have been other factors which were the main
causes of the decline in profits (which we understand to mean causes more important than the decline
in revenues).
414 Guatemala also presents a lengthy argum ent as to what it considers to be the
necessary consequences of Hylsa's and Hylsa-DAT's financial indicators as presented in paragraphs
221-224 of the Final Determination. According to Guatemala, these consequences include an increase
in operating costs (i.e., cost of goods sold plus operating expenses).415
7.360 We consider that this claim raises two interrela ted issues. The first is the factual question of
whether Guatemala has made a prima facie case that there was an "oth er known factor", namely an
increase in operating costs, that should have b een but was not taken into account in Economía's
causation analysis in the Final Determination. The second is whether an unbiased and objective
investigating authority could have reached the conclusion, as Economía did, that the decline in
profitability was due principally to a decline in revenues and an in crease in operating expenses, and
that of the two, the former was predominant.
7.361 Concerning the first issue, we note that Guatemal a's arguments in respect of this claim, as
well as the portions of the Final Determination wh ich it cites in support, changed considerably over
the course of this dispute. For example, as indi cated in paragraph 7.356 above, Guatemala's claim as
set forth in its first submission was limited to Hylsa-DAT, and was based on paragraphs 221 and 224
of the Final Determination exclusively. As noted above, the only references in those paragraphs to
increased cost elements during the POI (July-D ecember 2000) are the references to increases in
"gastos operativos" which are neither the same as, nor do they ineluctably cause, increases in "costos
operativos". Furthermore, while in its First Writte n Submission Guatemala refers to paragraph 221 as
pertaining to Hylsa-DAT, in a subsequent answer to one of our questions it indicates that this

412 Ibid.

413 Ibid.

414 Guatemala's response to questions 170 of the Panel, at para 52.

415 Guatemala argues, in its response to question 170 of the Panel, that "Economía drew no distinction
between, on the one hand, the injury caused to its profits by the drop in sales (assuming for the time being that
the sales were affected solely by dumped imports) and, on the other hand, the injury caused by other factors that
had a decisive influence on the dec line in profits (which include increases in operating costs in both its
components, in operating expenses and in cost of goods sold, for which Economía provides partial and
incomplete information)." We note that, to the extent that this argument refers to the issue of the six-month
periods used for the analysis, or to the fact that Economía based the analysis only on information for
Hylsa/Hylsa-DAT, we have addressed these issues in other sections of this report.

paragraph refers to "la solicitante" (i.e., Hylsa).
416 Guatemala then raises a number of new arguments,
based on other paragraphs of the Final Determina tion, pertaining to both Hylsa and Hylsa-DAT.
Among these arguments is a lengthy speculation as to what would have happened to various
components of Hylsa's and Hylsa-DAT's financial stat ements if certain events had occurred or certain
trends had continued. We consider that Guatem ala's initial presentation of its claim was based on a
misreading of paragraph 221 and a misunderstanding of the term "gastos operativos" in paragraphs
221 and 224, and we do not find its subsequent very different and essentially speculative arguments to
be convincing. As complainant, Guatemala bore the initial burden of proof to assert the affirmative of
its claim. For the reasons discussed, we consider that Guatemala did not provide evidence sufficient
to raise a presumption that what it asserted was correct, i.e., that the Final Determination indicates that
Hylsa-DAT's "operating costs" must have increased during the period of investigation.
7.362 Concerning the second issue, it is evident to us from the Final Determination that Economía
evaluated the details of Hylsa-DAT's financial perfo rmance, and that on the basis of this analysis,
Economía concluded that the decline in operating profits was caused by the reduction in sales revenue
and the increase in operating expenses, and that of these, the decline in sales revenue was
predominant.417 In our view, an unbiased and objective i nvestigating authority could properly have
reached this conclusion on the basi s of the facts as presented in the relevant portions of the Final
Determination. While we find the explanation in the Final Determination to be somewhat hard to
follow, we disagree with Guatemala that the Fi nal Determination indicat es that Economía had no
factual basis for the conclusion that it reached. Furthermore, given our standard of review, the issue is
not whether we would have evaluated the facts di fferently from Economía and come to a different
conclusion, but rather whether Economía failed to take into account an "other factor" which was
"known" to it. In our view, therefore, Guatemala has failed to establish a prima facie case of
inconsistency with the obligations under Articles 3.1, 3.2, 3.4 and 3.5, and even if it had met its prima
facie burden, we still would not find an inconsistency with Articles 3.1, 3.2, 3.4 and 3.5 for the
reasons set forth.
(ii) Exports
7.363 In respect of Economía's alleged breach of Ar ticles 3.1, 3.2, 3.4 and 3.5 relating to non-
attribution of injury from a decrease in exports, ther e is no disagreement between the parties that this
"decrease" occurred and was a "known factor". Rather, Guatemala's claim is that Economía's
appraisal of the decrease in exports was inadequate . In particular, according to Guatemala, on the
basis of the facts as set forth in the Final Determin ation, the absolute decrease in exports (described in
the Final Determination as a decline in the share of exports in relation to national production from
7 per cent to 5 per cent, or two percentage points, between the six-month periods of 1998 and 2000)
must have been equal to or greater than the 2 pe r cent drop in the volume of domestic sales during the
POI. In particular, Guatemala argues, a reduction of 2 per cent of total production would if anything
be larger in absolute terms than a reduction of 2 per cent of domestic sales, as total production could
be expected to be greater than domestic sales. As such, Guatemala argues, the impact on the state of
the domestic industry of the reduction in exports must have been at least commensurate with the
impact of the reduction in domestic sales. Guatemal a further asserts that even if the impact of the

416 Guatemala's response to question 170 of the Panel, at para. 42.

417 "…[I]n the period of investigation as compared to the previous comparable periods, the operating
profits of the Division of Steel Tubing recorded a declin e which can be attributed essentially to the drop in its
sales revenue, which was reflected in declines in th e Division's operating margin ...". Exhibit GTM-23,

decrease in exports was not determinative, the re sulting injury should still have been properly
attributed.418
7.364 Mexico did not respond directly to Guatemala' s statistical argument outlined above until the
very end of this dispute, in its comments responding to Guatemala's comments on statistical
information requested by the Panel at that stage 419, but instead initially argued that Guatemala had not
made out a prima facie case as in Mexico's view, Guatemala had claimed that the Final Determination
did not even address the decline in exports. In this regard, Mexico referred to the statement in the
Final Determination that Economía did not consider the decline in exports to be "determinative"
because of the small share of domestic production accounted for by exports. According to Mexico,
this assessment was reasonable and sufficient, and Ec onomía thus acted in full conformity with the
cited provisions of the Agreement in its treatment of exports. Mexico's direct responses to
Guatemala's statistical argument, submitted in its response to Guatemala's comments on the newly-
submitted statistical information are set forth below, at paragraph 7.371.
7.365 Before considering the detailed arguments of the parties, we set forth the relevant portion of
the Final Determination ("Effects on economic indicators"):
 "201. At this stage of the investigation, th e Ministry had direct information on the economic
indicators of the investigated pipe of the applicant, of Tubería Nacional and of Compañía
Mexicana de Tubos, which together accounted for 88 per cent of the domestic industry, so the
Ministry determined that the behaviour of these indicators was representative of the industry.

418 Guatemala's response to question 80 from the Panel:

"... Economía did not properly quantify the e ffects on domestic production of the drop in
exports as compared to the dr op in domestic sales. Economía indicated that domestic
industry’s sales to the domestic market grew by 3 per cent from 1998 to 1999 and then fell
by 5 per cent in 2000. There was thus an ov erall decline of 2 per cent in the period 1998-
2000. Economía also explained that domestic industry exports fell from 7 per cent "of
market-oriented domestic production" to 5 per cent in the course of the 1998-2000 period.
It would therefore appear that the decline in exports was largely the same as the decline in
domestic sales. In fact, the drop in exports may even have been greater than the drop in
domestic sales insofar as Economía apparently used different denominators in reckoning
these percentages. The drop in sales to the ma rket is shown as a percentage of domestic
sales, while the drop in exports is expressed as a percentage of "market-oriented domestic
production", which apparently refers to production for all markets. It can be assumed that
2 per cent of total domestic production for the market as a whole (" mercado de
comercialización") is broader in absolute terms than 2 per cent of sales to the domestic
market. Therefore, contrary to Economía's c onclusion, Economía's figures suggest that the
decline in exports had a greater effect on the pe rformance of the domestic industry than the
decline in domestic sales. In these circ umstances, Economía should have conducted a
proper non-attribution analysis to ensure that the injury caused by this factor was not
attributed to the subject imports."

 Mexico argues in its 23 January 2007 response to Guatemala's comments on information submitted by
Mexico in response to a question from the Panel (see paragraph 7.368, infra.) that, in arguing that the volume of
the decline in exports was triple the volume of the decline sales to the domestic market, Guatemala raised a new
argument in its comments. We disa gree. We consider that Guatemala' s argument on this point has been
consistent throughout this dispute, although obviously Guatemala lacked the precise data underlying the
statements in the Final Determination until Mexico's response to our request.

419 The Panel's request for information was dated 17 January 2007, Mexico's response submitting the
requested information was dated 19 January 2007, Guat emala's comments on the submitted information were
dated 23 January 2007, and Mexico's response to Guatemala's comments was dated 25 January 2007.

 202. On the basis of the information referred to in the previous point and that obtained
from the SICMEX list of 'pedimentos', the Mini stry noted that the Mexican market for the
investigated pipe, measured in terms of appare nt domestic consumption, calculated as set out
in points 173 and 174 of this Resolution, rema ined practically constant in the periods July-
December of 1998 and 1999, and increased 5 per cent in the period July-December 2000.

 203. The increase noted in apparent domestic consumption between July-December 1998
and the period of investigation was filled in part by imports of Guatemalan investigated pipe
which attained a 5 per cent share in the period of investigation, having been insignificant in
the period July-December 1998; imports from s ources other than Guatemala increased their
share by 6 percentage points in the period of investigation, following a virtually constant
share in the period July-December 1998 and 1999.

 204. The performance of imports was reflecte d in the behaviour of the total domestic-
market-oriented production of the applicant, Tubería Nacional and Compañía Mexicana de
Tubos. In absolute terms, this indicator dropped 2 per cent from the period July-December
1998 to the same period in 2000, notwithsta nding a 1 per cent increase in the period of
investigation in relation to the previous comparable period.

 205. Sales to the domestic market by these companies grew 3 per cent in July-
December 1999 in relation to the level reached in July-December 1998, then fell 5 per cent in
the period of investigation.

 206. The drop in the sales of these compan ies to the domestic market was largely
accounted for by the investigated imports entering in conditions of price discrimination, for
the following reasons: prices of imports from other sources were higher than the price of
Guatemalan imports and, as stated in points 178 and 179 of this Resolution, there is no
evidence in the administrative f ile that the main companies that imported pipe identified as
investigated products from other sources accounted for loss by the domestic industry of sales
or customers, since in the periods July-December 1998 and 1999 and in the period of
investigation, they were not identified as cu stomers of the applicant, the main domestic
producer of the investigated pipe.

 207. Total exports of the investigated pipe by the domestic industry showed a downward
trend: in July-December they dropped 51 per cent and in the period of investigation posted a
drop of 25 per cent. It should be pointed out that while in the period July-December 1998
they represented 7 per cent of market-orien ted domestic production, in the period July-
December 1999 and the period of investig ation they accounted for 3 and 5 per cent
respectively, so their behaviour could not be a d ecisive factor in explaining the injury to the
domestic industry.

 208. The trend in sales was reflected in a decline in production and, hence, in the
utilization of the installed capacity for productio n of the investigated pipe corresponding to
the domestic manufacturers.

 209. As to production in absolute terms, this indicator recorded a drop of 6 per cent from
July-December 1998 to the same period in 1999 and showed practically the same level in the
period of investigation in relation to the compar able previous period; utilization of installed
production capacity dropped 4 percentage points from the period July-December 1999 to the
period of investigation.

 210. With regard to the average inventories of these companies, the Ministry noted that in
the period of investigation they increased 3 per cent over the level recorded in July-December

1999; it is important to highlight that these accounted for 16 and 17 per cent of domestic-
market-oriented domestic production in the periods indicated. Furthermore, in the period of
investigation, the average employment level dropped 5 per cent as compared to the level
recorded in the comparable previous period.

 211. On the basis of the indications in points 195 to 210 of this Resolution, and taking
account of the arguments of the exporter and the applicant, the Ministry determined that the
economic indicators corresponding to the domestic producers Hylsa, Tubería Nacional and
Compañía Mexicana de Tubos, recorded negativ e behaviour in the period of investigation
owing largely to the increase in imports from Guatemala in conditions of price
discrimination.
420
7.366 We read the above portion of the Final Determina tion as a description of injury in the form of
and attributable to volume declines in domestic industry sales and production, which in turn,
according to Economía, were "principally due to" the increase in the volume of dumped imports from
Guatemala. In particular, the argument in the Fi nal Determination is that although apparent domestic
consumption increased during the period of investig ation, this growth was more than captured by
imports – among them the investigated imports from Guatemala – and that as a result the volume of
domestic producers' sales into the Mexican market dec lined. Economía attributed the decline in these
domestic sales largely to the imports from Guatem ala on the basis that the Guatemalan products'
prices were lower than those of the other imports, an d that the importers of the other imports were not
customers of Hylsa. The argument continues th at the reduction in the volume of the Mexican
producers' domestic sales brought about a decline in production and an increase in inventories. In
more precise terms, we thus view this part of the Final Determination as identifying the decline in the
volume of the domestic producers' sales into the Mexi can market as the nexus of the injury described
in this section of the Final Determination 421, as the Determination identifi es this decline as the cause
of the concurrent decline in production, capacity utilization and employment.422
7.367 We recall that Guatemala's factual argument in s upport of its claim is that the cited portion of
the Final Determination indicates that the reported ne t decline of two percentage points in the volume
of exports in relation to production between the 199 8 and 2000 half-year periods must, as a matter of
logic, have been at least as large as the net dec line in the volume of sales to the domestic market
between the same periods, given that the industry's total production volume could be expected to be at
least as large as the volume of domestic sales. We first considered this argument on the basis of the
text of the Final Determination cited above, and found its logic to be compelling. That is, on the basis
of this text, we did not see how the amount of th e decline in export volume could be less than the
amount of the decline in the volume of domestic sales.
7.368 We noted, however, that because of the absence in the cited text of either any absolute figures
or of any definitions of the terms used and thei r interrelationships, we could not reach a definite
conclusion as to this factual question. In particul ar, we needed to understand the meanings of the
different terms used in the text (e.g., "produ cción" (production), "producción nacional" (domestic
production), "producción orientada al mercado in terno" (domestic market-oriented production),

420 Guatemala - Exhibit GTM-23.

421 We recognize, as argued by Me xico, that Economía's causation analysis was not limited to volume
effects but also took into account financial and price e ffects (i.e., decreased profits). The section of the Final
Determination at issue in this claim is, however, concer ned only with volume eff ects, as the other effects
referred to by Mexico are addressed elsewhere in the Final Determination (and the claim relating thereto is
analyzed in the preceding section of this report).

422 Exhibit GTM-23, para. 207; Mexico first written submission, paras. 278 - 280.

"producción nacional orientada al mercado" (mar ket-oriented domestic production), "producción
nacional orientada al mercado interno" (domestic market-oriented domestic consumption), "consumo
nacional aparente" (apparent dom estic consumption), "importaciones de Guatemala y de otros
orígenes" (imports from Guatemala and other sources), "ventas al mercado interno" (sales to the
domestic market), "exportaciones" (exports), and "inv entarios" (inventories)) and how they related to
one another. That is, because of the different term s used, we could not be sure as to the degree of
similarity or difference between the bases on which the declines in domestic sales and exports, as
reported in the Final Determination, were calculated. For this reas on, as indicated above we asked
Mexico to provide us with the documents from the re cord of the investigation containing the figures
that justified the analysis and percentages referred to in paragra phs 201-210 of the Final
Determination. Mexico submitted a number of exhibits in response.
423 Guatemala then had an
opportunity to comment in writing on the new inform ation submitted by Mexico, and Mexico had an
opportunity to respond to Guatemala's comments.424
7.369 Of the information submitted, we find the fi rst page of Exhibit MEX-15 to be the most
pertinent to the factual question before us. This page, which consists of a table entitled "Indicadores
de la Industria Nacional" (Domest ic Industry Indicators), contains all of the figures on which the
narrative in the cited paragraphs of the Final Determ ination is based. From this table, we understand
that not all of the different production-related terms that appear in those paragraphs in fact have
distinct meanings. In particular, we note that "p roducción nacional" refers to total production of the
industry, including Procarsa (which did not provide data to Economía), while "producción" refers to
the production reported to Economía by Hylsa, Tuberí a Nacional, and Compañía Mexicana de Tubos.
Furthermore, the only subcategory of "producción" th at appears in this table is "producción nacional
orientada al mercado Mexicano" (Mexican market-oriented domestic production). From this fact, and

423 Our precise question, which we posed on 17 January 2007, was: "Paragraphs 201-210 of the Final
Determination refer to certain indi cators relating to the Mexican market and the performance of Mexico's
domestic industry, in particular "apparent domestic consumption", "imports from Guatemala and other sources",
"production for the domestic market", "sales to the domestic market" "exports", "domestic production for the
market ", "production" and "inventories". The Panel needs documents from the investigation file that contain all
of the figures supporting the analysis and the percentages in these paragraphs, i.e. the documents Economía used
in drafting the above-mentioned paragraphs." In response to this question, on 19 January 2007 Mexico
submitted Exhibits MEX-15 through MEX-25.

424 Guatemala's comments were dated 23 January 2007 and Mexico's responses were dated
25 January 2007. In addition to commenting on the question of the decline in exports, Guatemala raised a
number of points relating to its claims concerning Economía's use of six-month periods in its injury analysis,
and concerning Economía's use of data for varying groups of domestic producers for different injury indicators.
Guatemala also questioned whether the Panel's request fo r data from the record of the investigation was in
accordance with the Panel's standard of review. Mexico submitted responses on all of these points. We have
not found it necessary to rely on the arguments of the parties from this late stage of the dispute in reaching our
conclusions on Guatemala's claims relating to the six-month periods or the varying groups of domestic
producers, as we already had sufficient elements before us to resolve those claims. Concerning our standard of
review, we consider that Mexico correctly interpreted, and fully complied with, our request for information, and
we disagree with Guatemala's implication that a panel is prevented by the standard of review from seeking the
compiled data from the record of an investigation on which statistical descriptions contained in the authority's
determination are based. In this connection, we reca ll that under our standard of review, as set forth in
Article 17.6 of the Anti-Dumping Agreement, our task involves, inter alia, assessing the investigating authority's
establishment and analysis of the facts in the investigation. It is indeed well-established that Articles 17.5 and
17.6(i) require a panel to examine the facts made availa ble to the investigating authority. See, for example,
Appellate Body Report, Thailand – H-Beams, para. 118.

from a comparison of the data in the table with the percentages cited in the Final Determination, we
conclude that the other similar terms in the Final Determination425 in fact refer to this same concept.
7.370 This table provides confirmation of Guatemala's f actual allegation. That is, the data in the
table show that in absolute volume terms, the declin e in exports was in fact three times as large as the
decline in the volume of sales to the domestic market over the period described in the Final
Determination (i.e., July-December 1998 to July-D ecember 2000). Mexico argues in its comments
related to this information that Guatemala unjustif iably compares the data for the 1998 period to that
for the 2000 period, without taking into account the developments in the 1999 period. We note that
the Final Determination compares at various places data for the 1998 period to that for both 1999 and
2000, and that we therefore do not find Guatemala' s argument to be invalid. Guatemala's essential
point is that over the period examined by Economía, the decline in export volume was at least as great
as the decline in the volume of sales to the domes tic market, and that given the focus on volume in
this section of the Final Determination, there wa s no basis for Economía to have considered the
volume decline in exports as less important than the volume decline in domestic sales. In other
words, according to Guatemala, th e decline in exports was an "other known factor" causing injury, in
respect of which Economía failed to conduct the necessar y non-attribution analysis to ensure that this
injury was not attributed to the investigated imports.
7.371 In its response to Guatemala's comments on the new information submitted by Mexico in
Exhibits MEX-15 to MEX-25, Mexico provided a speci fic response to Guatemala's argument that the
volume decline in exports was greater than that in do mestic sales, such that the statement in the Final
Determination that the export decline was not dete rminative due to the small proportion of national
production accounted for by exports was an insuffici ent non-attribution analysis. Mexico does not
contest the factual accuracy of this argument, but rath er contends that it is erroneous to consider that
the importance to an industry of a decline in e xports is based on the numb er of tons involved, per se,
and that the significance of the decline instead depe nds on the percentage that this represents of
national production. We thus see Mexico as arguing that because domestic sales account for a
considerably higher proportion of domestic production than did export sales, the absolute tonnage
decline in domestic sales had a much greater (apparently "determinative") negative volume-based
impact on the condition of the domestic industry th an did the three-times-larger absolute tonnage
decline in export sales. We find no development of such concepts in the Final Determination,
however, but instead see only a conclusory statement there.
426
7.372 Under our standard of review, our task is to determine whether an unbiased and objective
investigating authority, on the basis of the relevant facts of record, could have reached the conclusion
in the Final Determination. Put in concrete terms, could an unbiased and objective investigating
authority have found that a given decline in the volume of sales to the domestic market was a
principal element of and factor in the injury experienced by the domestic industry (i.e., that this
decline which was caused by displacement by th e subject imports led to a harmful decline in
production, capacity utilization and employment), wh ile dismissing as not a "determinative factor" a
decline in the volume of export sales of at least th e same magnitude (in this case three times larger
over the full period considered). To us, the answ er on the face of these facts can only be in the

425 I.e., "producción orientada al mercado interno" (domestic market-oriented production) and
"producción nacional orientada al mercado" (market-oriented domestic production).

426 Mexico also raises other counterarguments to Gu atemala's comments. First, Mexico argues that
Guatemala's argument as presented in its comments is new, a contention with which we disagree, as we explain
in footnote 418. Mexico also asserts that Guatemala argued that Economía had not provided any reasons for
considering the decline in export sales not to be determin ative, which Mexico denies by stating that in fact the
Final Determination does refer to a reason. We do not consider that this character ization reflects Guatemala's
allegation, which in our view is that the reason provided is not convincing in the light of the facts as they can be
deduced from the relevant portion of the Determination.

negative. Nor do we consider that Economía ma de any attempt in the Final Determination to
distinguish the relative impacts on the industry of the respective declines in the volumes of domestic
sales and exports. To the contrary, the only explanation given by Economía for dismissing the decline
in exports as a determinative factor was exports' small share of domestic production. This statistic is
irrelevant, however, given that the "yardstick" used in Economía's entire analysis in this section of the
Determination was the absolute
 decline in volume, by which yardstick the decline in exports over the
period analysed by Economía was considerably larger than that in domestic sales. In short, we do not
consider that Economía's non-attribution analysis in respect of the impact of the decline in exports on
the domestic industry was sufficient. For these reas ons, we find that Economía acted inconsistently
with Mexico's obligations under Articles 3.1, 3.2, 3.4 and 3.5 in its treatment of the decrease in
exports in its causation analysis.
F. PROCEDURAL CLAIMS
1. Confidentiality and non-confidential summaries
(a) Arguments of the parties
(i) Guatemala
7.373 Guatemala asserts that Mexico violated Article 6.5 of the Anti-Dumping Agreement as it
failed to require the applicant to provide non-confid ential summaries, to evaluate the sufficiency of
the summaries, and to disclose properly information that was not shown upon good cause to be
confidential or, alternatively, to disclose non-confidential summaries of confidential information.
(ii) Mexico
7.374 Mexico argues that it proceeded precisely as envisaged by Article 6.5 of the Anti-Dumping
Agreement: it permitted the information concerned to be treated as confidential upon a showing of
sufficient good cause, while allowing qualified represen tatives of all interested parties (including
Tubac) opportunities for full access to the confidentia l information. Furthermore, Article 6.5.1
envisages that in exceptional circumstances, parties may indicate that information is not susceptible of
summary, if they provide a statement of the reasons why summarization is not possible. According to
Mexico, that is precisely what happened in the instant investigation.
(b) Arguments of the third parties
7.375 The European Communities declines to comment on certain aspects of Guatemala's claim,
as it has no access to the confidential information concer ned (e.g. in respect of Mexico's assertion that
numerical information is not susceptible of summary). However, a justification to designate
information as confidential cannot be a tautology, and the ground s that permitted understanding and
review of the reasons that led the IA to conclude that the information should be treated as confidential
is not clear from the record. In addition, Mexi co's domestic law and regulations on access to
confidential information cannot trump its obligations under Article 6.5 of the Anti-Dumping
Agreement.
(c) Evaluation by the Panel
7.376 We understand Guatemala to allege violations of the chapeau and paragraph 1 of Article 6.5
in respect of certain information in the course of the investigation.
427 The primary focus of

427 In response to question 114 from the Panel, Guatemala maintains that the legal basis for its claims
regarding the treatment of confidential information is the chapeau and paragraphs 1 and 2 of Article 6.5. The

Guatemala's claims is the initiation evidence relating to "normal value" (i.e. the invoice and the price
quote, already discussed above in our examination of Guatemala's claims under Article 5.3), while
Guatemala also refers to Hylsa's 17 Septem ber 2002 document containing information on the
description of the product under investigation (in partic ular, the issue of inclusion of certain structural
tubing within the scope of the produc t under investigation/like product).
428 We consider each of these
allegations below, after setting out relevant legal considerations.
7.377 Article 6.5 of the Anti-Dumping Agreement reads:
"6.5 Any information which is by nature confidential (for example, because its
disclosure would be of significant competitiv e advantage to a competitor or because
its disclosure would have a significantly adverse effect upon a person supplying the
information or upon a person from whom that person acquired the information), or
which is provided on a confidential basis by parties to an investigation shall, upon
good cause shown, be treated as such by the au thorities. Such information shall not
be disclosed without specific permission of the party submitting it.*
6.5.1 The authorities shall require interested parties providing
confidential information to furnish non-confidential summaries
thereof. These summaries shall be in sufficient detail to permit a
reasonable understanding of the substance of the information
submitted in confidence. In excepti onal circumstances, such parties
may indicate that such information is not susceptible of summary. In
such exceptional circumstances, a statement of the reasons why
summarization is not possible must be provided.
6.5.2 If the authorities find that a request for confidentiality is not
warranted and if the supplier of the information is either unwilling to
make the information public or to authorize its disclosure in
generalized or summary form, the authorities may disregard such
information unless it can be demonstrated to their satisfaction from
appropriate sources that the information is correct."**
*Members are aware that in the terr itory of certain Members disclosure
pursuant to a narrowly-drawn protective order may be required.
**Members agree that requests for confidentiality should not be arbitrarily
rejected.
7.378 The text of Article 6.5 of the Anti-Dumping Agreement states that confidential information
shall, upon good cause shown, be treated as such by th e authorities. Such information shall not be

panel request refers to Article 6.5 only. While the partie s have not raised any issue that the legal basis of the
claim is not identified in sufficient detail for the claim to be within the Panel's terms of reference, we are aware
that this is ultimately the Panel's responsibility. We consider that, in light of the description of the claims in the
Panel request, the reference to Article 6.5 is here sufficient to encompass claims under Articles 6.5 (chapeau)
and paragraphs 6.5.1 and 6.5.2.

428 In response to question 115 from the Panel, Gu atemala explains that Economía gave confidential
treatment to certain information relating to the product under investigation. This information was included in
the 17 September 2002 response by Hylsa to certain questions by Economía (and is in the Panel record, Exhibit
GTM-31). Guatemala asserts that this information wa s submitted as confidential, with no justification and
without a non-confidential summary.

disclosed without specific permission of the party submitting it.
429 This provision distinguishes
between two types of confidential information: (1) "information which is by nature confidential", and
(2) information "which is provided on a confidentia l basis". The requirement to show "good cause"
has been understood to apply to both these types of confidential information. 430 However, in our
view, the nature and degree of that requireme nt would depend on the type of information
concerned.431 For example, a showing of "good cause" for information that is "by nature confidential"
may consist of establishing that the information fits into the Article 6.5 (chapeau) description of such
information: "for example, because its disclosur e would be of significant competitive advantage to a
competitor or because its disclosure would have a significantly adverse effect upon a person
supplying the information or upon a person from whom that person acquired the information."
7.379 Article 6.5.1 establishes that the investigating au thority must require that interested parties
submitting confidential information also furnish a sufficiently detailed non-confidential summary.
432
These summaries have to permit a reasonable under standing of the substance of the confidential
information. However, such non-confidential summa ries need not be furnished when, "in exceptional
circumstances", the information "is not susceptible of summary". In such cases, "a statement of the
reasons why summarization is not possible must be provided". Although Article 6.5.1 does not
explicitly provide that "the authorities shall require" interested parties to provide a statement of the
reasons why summarization is not possible, we cons ider that Article 6.5.1 will be meaningfully
construed if the interested part y on its own initiative gives the reasons why summarization is not
possible, in which case it will be for the investig ating authority to ensure compliance with the
mandate in Article 6.5.1. 433 Accordingly, we consider that Article 6.5.1 imposes an obligation on
investigating authorities to require parties that indi cate that information is not susceptible of summary
to provide a statement of the reasons why summarization is not possible.
7.380 We see that Article 6.5.1 strikes a balance be tween the interests of the interested parties
submitting confidential information to have that c onfidentiality maintained during the investigation
and the interests of the rest of th e interested parties to be reasonabl y informed about the substance of

429 There is recognition that disclosure may be required pursuant to narrowly-drawn protective orders.

430 Panel Report, Guatemala - Cement II, para. 8.219; Panel Report, Korea - Paper, para. 7.334.

431 Panel Report, Korea – Certain Paper, para. 7.335.

432 Like the panel in US – Oil Country Tubular Goods Sunset Reviews (Article 21.5 – Argentina) ,
para. 7.135, we find the following finding by the panel in Guatemala – Cement II helpful:

"Although Article 6.5.1 does not explicitly provide that "the authorities shall require"
interested parties to provide a statement of the reasons why summarization is not possible, any
meaningful interpretation of Article 6.5.1 must impose such an obligation on the investigating
authorities. It is certainly not possible to conclude that the obligation concerning the need to
provide a statement of reasons is an obligation imposed exclusively on the interested party
submitting the information, and not the investigating authority, since the Anti-Dumping
Agreement is not addressed at interested parties. The Anti-Dumping Agreement imposes
obligations on WTO Members and their investiga ting authorities. Accordingly, in our view
Article 6.5.1 imposes an obligation on investiga ting authorities to require parties that indicate
that information is not susceptible of summary to provide a statement of the reasons why
summarization is not possible."

Panel Report, Guatemala – Cement II, para. 8.213.

433 We believe that this would also find support in Panel Report, Guatemala – Cement II, para. 8.213.

that information in order to be able to defend their interests. 434 We are aware that the designation of
information as "confidential" might affect the ability of interested parties to have full access to that
information, and therefore might affect their ability to defend their interests in the course of an anti-
dumping investigation. We are further aware of th e potential for abuse of the possibility to designate
information as confidential so as to consciously pl ace other interested parties at a disadvantage in the
investigation. We consider that the conditions set out in Article 6.5, chapeau, and 6.5.1 are of critical
importance in preserving the balance between the interests of confidentiality and the ability of another
interested party to defend its rights throughout an anti-dumping investigation. For precisely this
reason, we consider it paramount for an investigati ng authority to ensure that the conditions in these
provisions are fulfilled. We consider it equally im portant for a WTO Panel called upon to review an
investigating authority's treatment of confidential information strictly to enforce these conditions,
while remaining cognizant of the applicable standard of review.
7.381 Article 6.5.2 does not require any justificati on to be provided by the interested party
requesting confidential treatment. Any such obliga tion derives from Article 6.5, and not 6.5.2.
Article 6.5.2 speaks only to particular circumstan ces – if the authorities find that a request for
confidentiality is not warranted and if the supplier of the information is either unwilling to make the
information public or to authorize its disclosure in generalized or summary form. Since there is
nothing to suggest that the Mexican investigatin g authority found that the applicant's request for
confidentiality of the relevant information was not warranted, Article 6.5.2 would, in any event, not
appear to be applicable in the factual circumstan ces of this case. It may, nevertheless, provide
contextual guidance in our resolution of Guatemala's claim.
7.382 Article 6.5.2 addresses circumstances wher e the authorities find that a request for
confidentiality is not warranted. To us, this is a clear textual indication that the investigating authority
has the responsibility – indeed, the obligation – to review, and decide upon, whether a request for
confidentiality in line with the chap eau of Article 6.5 is, or is not, warranted. It is clear that
Article 6.5 requires an investigating authority to ex amine the request for confidential treatment and to
decide whether or not it is warranted. However, Article 6.5 says nothing regarding the nature of the
examination process to be carried out. Nor does it say anything requiring an explanation of how that
examination was carried out.
435 There is no express provision re gulating what should occur in the
circumstance where an investigating authority considers that a request for confidentiality is warranted,
beyond the obligation to treat such information as conf idential. Nor does the text of Article 6.5 or
6.5.1 contain any express obligation relating to how an investigating authority should decide in
respect of a party's assertion that summarization of confidential information is not possible, nor how
an investigating authority should or must communicate any decision on this matter.
7.383 With these considerations in mind, we turn to the particular circumstances of this case.
Turning to the initiation evidence on normal value, we see that the applican t requested confidential
treatment for much of the evidence supporting its application – including information relating to
normal value and the description of the product under investigation.
7.384 With respect to Guatemala's allegations about the treatment of confidential information in
connection with the initiation evidence relating to "nor mal value", we recall that both of the relevant

434 See, for example, Panel Report, Argentina – Ceramic Tiles, paras. 6.38-6.39.

435 We recall that the notice required by the transparency provisions in Article 12.1 is not at issue here.
In any event, the obligations in Article 12 include the statement that: "Such a notice or report shall, due regard
being paid to the requirement for the protection of confidential information, contain in particular: ..."

pieces of evidence – the invoice and the price quote – were part of the Panel record.
436 The applicant
provided a non-confidential version of the application, but as the invoice was "confidential", it was
not included in this non-confidential version of th e application; similarly, as the price quote was
"confidential" it was not included in Hylsa's response 437 to the "prevención". 438 I n t h e n o n -
confidential version of the application, certain part s of the application were deleted from the text and
replaced by blank square brackets, or – in the case of the Annex concerned – simply by blank
columns. The substance was left out. The application contains a general statement indicating why the
applicant considered the information should be treated as confidential. 439 No non-confidential
summary of the omitted confidential information was submitted to Economía, nor is there any
indication that Economía requested such a non-confidential summary once it had seen how
information therein had been treated. The applica tion asserts that the non-confidential version of the
application contained sufficient detail to permit a reasonable understanding of the substance of the
information, while omitting certain elements and data that, due to their confidential nature and as they
consisted of numerical data and identification numbers, were not susceptible of summary.440
7.385 More specifically, the non-confidential vers ion of the application (Exhibit GTM-1,
Section II.B.1), indicates only that the evidence of normal value "is documented with the commercial
invoice of the investigated product documented in Annex 2.1." 441 It also contains square brackets,
indicating that confidential information has been redacted. "Anexo 2" is a table containing
14 columns, of which nine contain square brackets indicating that confidential information has been
redacted, and five contain information. The informat ion included in the table sets out the tariff lines,
the description of the product under investigation – standard welded conductio n tubing and standard
black conduction tubing – the conversion factor of the unit of measurement for the tariff line, the
US dollar exchange rate and, finally, the adjusted price (US dollar per tonne). This adjusted price for
both types of tubing is given as "707". This Anne x makes reference to "documentation of the internal
price in Guatemala" in Annex 2.1, but does not further describe or summarize the documents
containing the supporting evidence. Therefore, we consider that there is no summary in sufficient

436 The former was annexed to Mexico's first written submission; the latter was submitted in response
to the Panel's request and following the Panel's adoption of special BCI Procedures after the first meeting.

437 Exhibit GTM-3.

438 Exhibit GTM-2.

439 The lawyer's cover letter for the application states: "My client considers that the information
omitted in the square brackets in the public version of Volumes I and II, and the annexes expressly mentioned
therein is bound to confer on them a confidential char acter, for which reason the Honorable Unit is kindly
requested under the terms of Article 158 of the Foreign Trade Act Regulations to assi gn such character to the
said information, since its disclosure would have the consequence of harming its competitive position and its
ability to obtain information relevant to the running of th e investigation". Exhibit GTM-1. The cover letter to
Hylsa's response to the "prevención" in Exhibit GTM-3 contains a similar paragraph. The "prevención" in
Exhibit GTM-2 indicates Economía's guidelines as to how confidential information should be treated in
responding to the questions contained therein, including the need submit both a confidential and public version
of the responses, with the public version redacting the confidential information, as well as the need to justify the
confidential treatment of the information, and to summarize it.

440 Exhibit GTM-1. The cover letter to Hylsa's response to the "prevención" in Exhibit GTM-3
contains a similar paragraph.

441 There is also a brief response expl aining why, in the applicant's vi ew, the sales prices presented are
proper. Exhibit GTM-1.

detail to permit a reasonable unde rstanding of the substance of the information submitted in
confidence.442
7.386 In response to questioning 443, Guatemala clarified that it is also alleging that the treatment of
information contained in the petitioner' s 17 September 2002 response to Economía's
3 September 2002 "oficio" pertaining to the basis for the possible inclusion of certain structural tubing
within the scope of the product definition was inconsistent with Mexico's obligations under
Articles 6.5 and 6.5.1. 444 In particular, Guatemala alleges th at this information was designated as
"confidential" without justification and without a requirement to provide a non-confidential summary.
7.387 Here again, the applicant provided a non-confid ential version of the document concerned. In
the non-confidential version, certain parts of the r esponses in the document were deleted from the text
and replaced by blank square brackets, or – in th e case of the Annexes – simply by title pages with
absolutely no contents. The s ubstance was left out. In respon se to Economía's indication in the
3 September 2002 "oficio" that any request for conf idential treatment had to be justified and a non-
confidential summary provided 445, Hylsa's cover letter contains an explanation as to why it treats the
information as "confidential", and why summarizati on of certain confidential information was not
possible.446 No non-confidential summary of the omitte d confidential information was submitted to
Economía, nor is there any indication that Economía requested such a non-confidential summary once
it had seen how information therein had been treated.447

442 Exhibit GTM-3 indicates that, in response to a question concerning evidence of normal value in
respect of standard black tubing, Hylsa responded: "There is documentation of normal value in the Guatemalan
market regarding black standard tubing and the corresponding adjustments. See annex 13 [Confidential]".
correspondientes" (Documentation of normal value for black standard tubing and corresponding adjustments);
Annex 13.1 is entitled "Documentación del precio interno de Guatemala" (Documentation of domestic price in
Guatemala); Annex 13.2 is entitled "Cálculo para obtene r Dólares por Tonelada" (Calculation to obtain dollars
muestra el valor normal" (Documentation of the domici le of the company issuing the document that shows
(Estimate of the margin of dumping for standard black tubing). The contents of all of these annexes are entirely
redacted. (Annex 13.3 includes non-confidential data on exchange rates).

443 Guatemala's response to question 115 from the Panel.

444 Exhibit GTM-31.

445 Exhibit GTM-21.

446 The cover letter states: "My client considers that the information omitted between the square
brackets in the public version of the attached, and the annexes expressly specified therein, must be treated as
confidential, for which reason, pursuant to Article 158 of the Foreign Trade Act Regulations they kindly request
the Honorable Unit to confer a confidential character on the said information, since its disclosure would have
the consequence of harming their competitive position and ability to obtain information relevant to the running
of the investigation. Accordingly, pursuant to Article 153 of the Foreign Trade Act Regulations, and as
indicated herein, my client has attached a public version of the said information which contains enough elements
to allow a reasonable and comprehensive understanding of the matter, while omitting from the said version
certain aspects and information which, being by nature confidential and consisting of numerical and
identification data, are not susceptible of summary." Hy lsa thus requested: "… that confidential treatment be
afforded to the replies and annexes hereto as indicated, since their disclosure could affect the competitive
position of the company and cause my client substantial harm".

447 Mexico, however, asserts that the non-confidentia l version contains a summary of the confidential
information. See, for example, Mexico's rebuttal submission, para. 215. Mexico submits Exhibit MEX-5 to

7.388 More specifically, the non-confidential version of the document in question contains certain
responses by Hylsa-DAT regarding the scope of the product under investigati on. Certain of the
information in the responses is redacted as "confid ential". In addition, the entire content of the
six Annexes
448 is all redacted as "confidential". The document does not further describe or summarize
the redacted portions in the body of the document, nor the annexes containing the supporting
evidence. Therefore, we consider that there is no summary in sufficient detail to permit a reasonable
understanding of the substance of the information submitted in confidence.
7.389 Guatemala takes issue with two main aspects of Economía's treatment of the information
concerned. First, the application and Exhibit GT M-31 contain a general statement indicating why the
applicant considered that the information should be treated as confidential. Guatemala alleges that
there is no indication on the record of the investiga tion that Economía assessed the sufficiency of this
justification as to whether "good cause" existed to afford confidential treatment. Second, the
applicant also asserts that the non-confidential versi on of the application contained sufficient detail to
permit a reasonable understanding of the substance of the information, while omitting certain
elements and data that, due to their confidential na ture and as they consiste d of numerical data and
identification numbers, were not susceptible of summary. 449 In this context, Guatemala asserts that,
even if the confidential treatment was justified, it was not impossible for the applicant to provide non-
confidential summaries. Nevertheless, the information was omitted and not summarized.
7.390 We note that, in respect of both the initiation evidence on normal value, and its 17 September
responses, the applicant did provide reasons which, in its vi ew, justified non-disclosure and non-
summarization of the information concerned.
7.391 Guatemala argues that Economía did not evalua te whether "good cause" had been shown for
the underlying information to be treated as confiden tial. Guatemala also asserts, in respect of the
price quote and the invoice, that the disclosure of the information would not have affected the
applicant's competitive position or its ability to obta in further information, as: the information
concerned prices within Guatemala; the exporter (a nd not the applicant) would have the responsibility
of seeking such information post-initiation; and – with the exception of the name of the buyer or of
the requester of the price quote – the information was not confidential by nature.
7.392 Mexico argues before us th at Economía's practice is only to record explicitly reasons for
rejecting a request for confidential treatment – wher e Economía accepts such a request, it makes no
explicit indication, but simply accords confidential treatment to the information.450 In the instant case,

substantiate its assertion that it transmitted this non-c onfidential version to Tubac's legal representative.
However, the issue is not whether a non-confidential version of the submission was transmitted; but rather,
whether an adequate non-confidential summary of the confidential information was transmitted.

448 The public information in the responses and the titles of these annexes indicate that they include
documents and testimonials and invoices from producers/distributors concerning the commercial practice of
acquiring structural tubing without hydrostatic testing and using it for conduction; information from importers
of certain types of structural tubing; estimates of the breakdown of national production of the product under
investigation; and testimonials on the substitutability and correspondence of the data provided with the
description of the product.

449 Exhibit GTM-1.

450 Mexico outlined the provisions of its domestic legislation and regulations in respect of the treatment
of confidential information throughout an anti-dumping i nvestigation, in particular Article 80 of its Foreign
Trade Act and Articles 148-158 of its associated regulatio ns. Briefly, Article 80 of Mexico's Foreign Trade Act
provides that restricted commercial information and confidential government information shall not be available
to any interested parties. Article 148 of the Regulations says that summaries of confidential information and

we find that there is no such explicit indication in the record. However, it is implicitly clear that
Economía accepted the assertions of the applicant and did not oppose the request for confidential
treatment. The record does not contain any explicit indication as to how, or the extent to which,
Economía assessed this justification for non-summari zation or reached a reasoned conclusion on this
matter. However, again, implicitly, the record reveals that Economía accepted the applicant's
assertions relating to non-disclosure and non-summarization.451
7.393 Recalling the standard of review, as we have stated above, we do not consider that the
obligations contained in Article 6.5 set forth exactly how an investigating authority should or must
evaluate a request for confidential treatment;. Nor do we consider that this provision sets forth how
an investigating authority should or must indicate (explicitly or otherwise in the record of the
investigation) how, and the extent to which, it assesse d an applicant's assertion to conclude that "good
cause" existed for the information to be treated as co nfidential within the meaning of Article 6.5, or
how, and the extent to which, it assessed an asserti on that summarization was not possible within the
meaning of Article 6.5.1.
7.394 We consider that, in this case, Mexico a dhered to the minimum threshold permitted by
Article 6.5 and 6.5.1 in its treatment of the confid ential information concerned. In particular, the
investigation file indicates clearly that Hylsa soug ht confidential treatment and provided reasons for
its request and that Hylsa also explained why, in its opinion, it was impossible to summarize certain
information. As said above, we infer from the fa ct that Economía granted the confidential treatment
that Economía accepted the request and the explanati ons, and we point out that the cited provisions of
the Agreement contain no express requirement re garding the nature of the evaluation by the

restricted commercial information presented in accordance with Article 153 of the Regulations (Article 148.II)
shall be treated as public information. Article 150 defines restricted commercial information as information that
meets Articles 152, 153, and 158 of the Regulations and information the disclosure of which may result in
substantial and irreversible material and financial harm to the owner of the information, inter alia. Article 153
establishes that the party interested in ensuring the co nfidential or restricted co mmercial treatment of his
information and documents shall submit a public summary thereof to the Ministry. This summary shall be
presented in writing and shall be suff iciently detailed to allow anyone consulting it to have a reasonable and
comprehensive understanding of the subject. Article 158 of the Regulations establishes that the interested party
concerned shall comply with the following requirements: submit the information in writing; explain why his
information is of a confidential or re stricted commercial character; present a summary of the information or, if
applicable, an explanation of the reasons why it cannot be summarized; and, if applicable, give his express
consent in writing that the information marked as confidential or restricted commercial may be examined by the
legal representatives of the other interested parties.

We are not called upon to evaluate the consistency of these legal and regulatory provisions as such
with Mexico's obligations under Article 6.5 of the Agre ement, and recall that the provisions of a Member's
internal law do not justify a violation of its interna tional obligations. See, e.g. Appellate Body Report, Brazil -
Aircraft (Article 21.5 -Canada), para. 46.

451 We note, in passing, Mexico's assertion that Tub ac also asserted in the course of the underlying
investigation that numerical data was not susceptible of summary, and Economía afforded confidential treatment
on the same basis as it had to Hylsa's information. Tubac asserted, for example, in its 14 May 2002 "escrito"
(Exhibit GTM-12, pp. 2-3; see also Exhibit GTM-7, para. 17) that it had produced a public version of its
confidential submissions, redacting certain confidential information between square brackets. Tubac also
asserted that, as certain information could consist of in ternal accounting or financial data of the exporter or a
third party, of which there were not very many, disclosure might cause irreversible damage to Tubac or third
parties. Tubac further asserted that certain data were not susceptible of summary due to their numerical nature.
There is no indication on the record th at such assertions on the part of T ubac were treated an y differently than
the similar assertions made by Hylsa. We would expect an IA to afford such even-handed treatment to both
interested parties.

investigating authority. We would have preferred an explicit indication, on the part of Economía, as
to why it considered that the assertions of "good cau se" for confidential treatment of the information
concerned were merited. We would also have pref erred an explicit indication by Economía as to how
it went about evaluating the existence of the "exceptional circumstances" referred to in Article 6.5.1 in
order to justify the non-summarization of certain conf idential information. In this respect, we recall
that a main reason given for information not be ing susceptible to summarization was that it was
numerical in nature. We note that Mexico's ow n domestic legal framework explicitly envisages the
possibility that information on costs and prices may be presented in ranges of percentage variation not
exceeding a factor of 10 per cent.
452 This provision indicates to us Mexico's (and Economía's) own
official recognition that at least certain numerical information may be susceptible of summarization.453
However, we do not see any indication in the reco rd that any efforts were made to explore
possibilities for presentation of the confidential info rmation concerned in a manner that, while not
compromising the confidentiality of the information, would have permitted inte rested parties a higher
degree of access to it in terms of the non-confidential record of the investigation.
7.395 Nevertheless, for the reasons a bove, the Panel finds that Guatem ala has not established that
Mexico violated its obligations under Article 6.5 and 6.5.1 in its treatment of requests for
confidentiality and assertions of reasons why summa rization of confidential information was not
possible.
7.396 We also note that Article 6.5 acknowledges, in th e territory of certain Members, disclosure of
confidential information pursuant to a narrowly-dr awn protective order may be required. We are
aware that Mexico has in a place a legislative/ regulatory framework governing the treatment of
confidential information throughout a Mexican anti- dumping investigation. Under that framework,
legal representatives of all interested parties may have full access to confidential information, upon
satisfying a number of conditions an d filing the requisite documentation.
454 Furthermore, Mexico
submits in evidence a request (by Tubac's legal representative) for access to certain confidential
information.455 Mexico asserts that this proves that there was no prejudice to the Guatemalan
exporter, as it had the right to have access to the confidential information in the application at the time
of the initiation of the investigation, and, in fact, av ailed itself of that right on at least one occasion.
However, Guatemala contends that Mexico's evidence and argumentation about access to the
confidential record by Tubac's legal representative is erroneous. According to Guatemala, Tubac's
legal representative never requested access to any part of the confidential record, including the
confidential version of the application, as she did not satisfy all of the conditions under Mexican law
pertaining to requesting access to the confidential reco rd, and accordingly never did so. In particular,
Guatemala asserted:
"Guatemala confirms that Tubac did not have access to the
information supplied by the applican t and that in the end it was used
as ‘facts available’ for the purpose of the determination of dumping.
As the attached statement explains:

452 Article 149 of Mexico's Regulations associated with its Ley de Comercio Exterior.

453 In response to question 121 from the Panel, Mexico stated that Article 149 of Mexico's Regulations
has not been applied in the administrative practice of Economía and thus it was not possible to clarify the scope
of this provision.

454 See, in particular, Articles 159- 161 of Mexico's Regulations associ ated with is Ley de Comercio
Exterior.

455 Exhibit MEX-2. The date of th e request for access is dated Novemb er 2002 (whereas the initiation
occurred in August 2001, and the Preliminary Determination, public hearing and communications arising out of
the public hearing, including Exhibit GTM-31, were all submitted prior to November 2002).

According to Article 80 of the Foreign Trade Act and to Articles 159,
160 and 161 of its Regulations, in order for the legal representatives
of the parties interested in the proceedings to have access to the
confidential information, a request in writing must be submitted to
the Ministry expressing the need for review of the confidential
information, and must be accompanied by the following:
(a) The duly requested official form ‘Accreditation of Legal
Representative Requesting Access to Confidential Information’.
(b) Surety (policy) for the amount set by the Ministry in accordance
with the Federal Fiscal Code . The amount is currently
$4,200,000.00 MN.
(c) A written statement from the co mpany represented (Tubac in this
case) to the effect that the legal representatives have not been
partners or directors or acted as a salaried agents or representatives of
the company or other interested parties during the previous year.
(d) Documents showing that the representatives are resident in
Mexico.
Upon submission of the request, Economía issues a document
authorizing or refusing access. It is Economía's administrative
practice to include in the public administrative file both the request
for access and the document granting or refusing it.
In this investigation Tubac's legal representatives had not even the
possibility of gaining access to the confidential information because
not all the requirements were met for filing the request."
456
7.397 We do not fully understand the decision of Tub ac to participate in this investigation
exclusively on the basis of the non-confidential record. 457 We commend Mexico on maintaining a
domestic legal and regulatory framework that permits legal representatives of interested parties in an
anti-dumping investigation, under certain circumstances, to access the confid ential record. We note
that some of the conditions for access are somewhat stringent, and may, as in the present case, affect
the legal representation of an interested party on the basis of the confidential record of the
investigation. However, we do not see these conditi ons as being so insurmountable as to bar effective
legal representation of an informed interested pa rty. For example, under the bond requirement, the
company would have to pay approximately US$2,000.458
7.398 Notwithstanding the foregoing, while such a sy stem of limited disclosure is certainly
envisaged by Article 6.5 459, and may certainly act as a supplement to a Member's fulfilment of its

456 Guatemala's response to question 104 from the Pane l. See also Guatemala' s response to questions
117-118 from the Panel and Exhibit GTM-32. See Articles 159-161 of Mexico's Regulations to the Ley de
Comercio Exterior.

457 At least, Guatemala has not brought to our attention in these Panel proceedings any other
representative of Tubac that did have access to the confidential record of this investigation.

458 See Mexico's response to question 184 (b) from the Panel.

459 In particular, the footnote reading:

obligations under Article 6.5, we find no textual basi s in Article 6.5 that would indicate to us that
permitting limited access to the entire confidential r ecord to individuals fulfilling certain conditions,
provides a derogation from, or replaces, the obligations of an investigating authority under Article 6.5
to require justification for treatment of information as confidential and, if such treatment is justified,
to require non-confidential summaries of the confiden tial information, or, alternatively, to require
justification for the non-summarization of certain information.
460
7.399 For these reasons, we find that Guatemala has failed to establish that Mexico has acted
inconsistently with its obligations under the chapeau of Article 6.5 and paragraph 6.5.1 in this case.
2. Contents of Preliminary and Final Determinations
7.400 We recall Guatemala's allegation that Mexico violated Article 12.2 of the Anti-Dumping
Agreement as it failed to provide adequa te and reasoned explanations in either the Preliminary or
Final Determination 461 on the decision of Economía to change the definition of the product under
consideration to include tubing from 4" to 6" in its Preliminary Determination. 462 W e r e c a l l o u r
finding that Mexico acted inconsistently with its obligations under para graph 7 of Annex II and
Article 6.8 in respect of its use of facts availabl e to reach its dumping de termination, including in
respect of the change in the product definition to include product with diameters from 4-6".463 In light
of our finding of incons istency with these provisions, we find it neither necessary nor appropriate to
address Guatemala's Article 12.2 claim of inadequate notice in respect of the change in product
definition to include with diameters from 4-6". We note that our finding concerning paragraph 7 of
Annex II and Article 6.8 addressed, among othe r things, the explanation of the dumping
determinations in Mexico's notices. Having found a violation of the requirements set forth in
paragraph 7 and other paragr aphs of Annex II along with Article 6. 8 in relation to Economía's resort
to "facts available" in reaching its dumping determinat ion, the question of whether the notice of either
the Preliminary or Final Determinations is "suffi cient" under Article 12.2 is immaterial. We agree
with the view of the Panel in EC - Bed Linen that a notice may adequately explain the determination
that was made, but if the determination was subs tantively inconsistent with the relevant legal
obligations, the adequacy of the notice is meaningless. By the same token, it is meaningless to
consider whether the notice of a decision that is su bstantively inconsistent with the requirements of
the Anti-Dumping Agreement is, as a separate matter, insufficien t under Article 12.2. A finding that
the notice of an inconsistent action is inadequate does not add anything to the finding of violation, to

"Members are aware that in the territory of certain Members disclosure pursuant to a
narrowly-drawn protective order may be required."

460 We find support for our view in e.g. Panel Report, US – Oil Country Tubular Goods Sunset Reviews
(Article 21.5 – Argentina), para. 7.137.

461 Guatemala's argumentation was not always consistent concerning the scope of its claim under
Article 12.2. For example, in its rebuttal submission, the pertinent section is entitled "Mexico failed to refute
Guatemala's claim that the disclosure of the findings and conclusions in the preliminary determination is
inadequate" (emphasis added). In other places, such as Guatemala's first written submission, para. 336,
Guatemala refers to both the Preliminary and Final Determin ations. As the panel request, and at least certain of
Guatemala's arguments, refer to both the Preliminary and Final Determinations (see document WT/DS331/2,
para. (n)), we have treated Guatemala's claim as referring to both the Preliminary and Final Determinations.

462 Guatemala confirmed to us that it abandoned its additional complaint about the "inclusion" of
certain structural tubing in the final determination. See Guatemala's response to questions 128-130 from the
Panel.

463 We refer to our finding, supra, para.7.197.

the resolution of the dispute before us, or to the understanding of the obligations imposed by the Anti-
Dumping Agreement. We therefore make no findings in respect of this claim.464
3. Essential facts
7.401 Guatemala claims that Mexico violated Article 6.9 failing to disclose to Tubac the "essential
facts" under consideration in the investigation. According to Guatemala, Tubac was never informed
in any way before the Final Determination that: (1) facts available, in particular information submitted
by the applicant, would be used to calculate the margin of dumping; or that (2) certain structural
tubing would be included in the scope of the product under investigation and the anti-dumping
measure imposed. We recall our earlier finding, in respect of Economía's dumping determination that
Economía had acted inconsistently w ith paragraph 6 of Annex II, and thus Article 6.8, by failing to
inform Tubac that its data were being rejected and of the reasons for that decision, and by failing to
provide Tubac with an opportunity to submit further e xplanations. In light of this finding, we do not
consider it necessary to also address Guatemala's allegations under Article 6.9.
G. CLAIMS UNDER ARTICLES 1 AND 18 OF THE ANTI-DUMPING AGREEMENT
7.402 Guatemala alleges that Mexico – through Economía – acted inconsistently with its obligations
under Articles 1 and 18 of the Anti-Dumping Agreement in having contravened the other provisions of
the Anti-Dumping Agreement cited in its complaint. We note that Guatemala's claims under Articles 1
and 18 of the Anti-Dumping Agreement are dependent claims, in the sense that they depend entirely
on findings that Mexico has violated other provision s of the Agreement. In light of the dependent
nature of Guatemala's claims under Articles 1 and 18 of the Agreement, and of our findings, supra, of
violations of other provisions, we see no useful purpose to deciding them. 465 In particular, we do not
believe that deciding such dependent claims will pr ovide any additional guidance as to the steps to be
undertaken by Mexico in order to implement our recommendations regarding the violations that we
have found.
VIII. CONCLUSIONS AND RECOMMENDATION
8.1 For the reasons set out above, we conclude th at Mexico's initiation of the investigation, the
conduct of the investigation and the imposition of a definitive anti-dumping measure on imports of
black and galvanized steel pipes and tubes from Guat emala is inconsistent with the requirements of
the Anti-Dumping Agreement, in that:

 (a) Economía's determination that there was sufficient evidence of dumping and injury to
justify initiation of the investigation is in consistent with Mexico's obligation under
Article 5.3 of the Anti-Dumping Agreement and, consequently, its failure to reject the
application in the absence of sufficient evid ence of either dumping or injury to justify
proceeding with the case is inconsistent with Article 5.8 of the Anti-Dumping
Agreement;

 (b) Economía acted inconsistently with Mexi co's obligations under Articles 3.1, 3.2, 3.4
and 3.5 of the Anti-Dumping Agreement in relying, without sufficient justification,
upon injury data limited to three six-mont h periods (July-December) in the years
1998, 1999 and 2000 in its determination of injury and causation, as proposed by the
applicant;

464 See Panel Report, EC - Bed Linen, paras. 6.259 - 6.261.

465 We note that a similar approach was followed, e.g., in Panel Reports, Guatemala – Cement II,

 (c) Economía acted inc onsistently with Mexico's obligations under Articles 3.1 and 3.2 to
conduct an objective examination of positive evidence by using a methodology
premised on a limited sample and unsubs tantiated assumptions in estimating the
volume of imports from sources other than Guatemala;

 (d) Economía acted inconsistently with Mexi co's obligations under Articles 3.1, 3.2, 3.4
and 3.5 of the Anti-Dumping Agreement to conduct an objective examination on the
basis of positive evidence of injury to the domestic industry – as that term is defined
in Article 4.1 – by failing to gather and analyse representative and consistent data
pertaining to the domestic industry, in par ticular the data concerning the financial
indicators of the domestic industry as a whole, as this had been defined by Economía;

 (e) Economía acted inconsistently with Mexi co's obligations under Articles 3.1, 3.2, 3.4
and 3.5 of the Anti-Dumping Agreement in its analysis of injury and causation by
failing to adequately analyse and properly attribute injury to the domestic industry
caused by a decrease in exports;

 (f) Economía acted inconsistently with Mexico's obligations under paragraphs 3 and 5 of
Annex II and Article 6.8 in deciding to reject in their entirety the data that Tubac had
submitted and to rely instead on facts available;

 (g) Economía acted inconsistently with Me xico's obligations under paragraph 6 of
Annex II and Article 6.8 by failing to inform Tubac that its data were being rejected
and of the reasons for that decision, and by failing to provide Tubac with an
opportunity to submit further explanations;

 (h) Economía acted inconsistently with Me xico's obligations under paragraph 7 of
Annex II because in applying as facts availa ble the normal value evidence that was
provided by the applicant and used in Econom ía's initiation decision, it failed to use
"special circumspection".

8.2 In the light of our findings above, we further conclude that:
 (a) Guatemala failed to establish that, in the circumstances of this case, Economía acted
inconsistently with Mexico's obligations under Articles 3.1, 3.2, 3.4 and 3.5 to
conduct an objective examination of positive evidence by relying on data from an
investigation period that terminated eight months prior to the initiation and about
two years prior to the imposition of the definitive measures;

 (b) Guatemala failed to establish a prima facie case of inconsistency with Articles 3.1
and 3.2 in respect of Economía's analysis of the price effects of imports from
Guatemala;

 (c) Guatemala failed to establish that Econom ía acted inconsistently with Mexico's
obligations under Articles 3.1, 3.2, 3.4 3. 5 or 5.4 by failing to conduct an objective
examination of positive evidence in respect of the data collected and analysed in its
determination of injury to the domestic industry (as that term is defined in Article 4.1)
in light of the changes of the product defi nition to include 4"-6" product and certain
structural tubing;

 (d) Guatemala failed to establish that Econom ía acted inconsistently with Mexico's
obligations under Articles 3.1, 3.2, 3.4, or 3.5 in its consideration of the behaviour of
costs in the context of the injury and causation analysis;

 (e) Guatemala failed to establish that Econom ía acted inconsistently with Mexico's
obligations under the chapeau of Article 6.5 and paragraph 6.5.1 in its treatment of
confidential information in this case.

8.3 In the light of our findings, it was not necessary for us to address, and we have exercised
judicial economy, in respect of:
 (a) Guatemala's claims under Articles 2.1, 2.4 and 2.6 relating to the changes to the scope
of the product under investigation;

 (b) Guatemala's claims under Articles 6.2, 6. 4, 6.7, 6.9 and 6.13 relating to Economía's
rejection of the information submitted by Tubac and its resort to facts available;

 (c) Guatemala's transparency claim under Ar ticle 12.2 relating to the contents of the
Preliminary and Final Determinations in resp ect of the inclusion of 4"-6" product in
the scope of the product definition;

 (d) Guatemala's claims under Article 6.9 pe rtaining to the alleged failure to disclose
"essential facts" pertaining to the resort to facts available and the inclusion of certain
structural tubing in the scope of the product definition; and

 (e) Guatemala's consequential cl aims under Articles 1 and 18 of the Anti-Dumping
Agreement.

8.4 Under Article 3.8 of the DSU, in cases where there is infringement of the obligations assumed
under a covered agreement, the action is considered prima facie to constitute a case of nullification or
impairment of benefits under that agreement. Accordingly, we conclude that to the extent the Mexico
has acted inconsistently with certain provisions of the Anti-Dumping Agreement , it has nullified or
impaired benefits accruing to Guatemala under that Agreement.
8.5 Article 19.1 of the DSU reads:
Where a panel or the Appellate Body conclud es that a measure is inconsistent with a
covered agreement, it shall recommend that the Member concerned bring the measure
into conformity with that agreement. In addition to its recommendations, the panel or
Appellate Body may suggest ways in which the Member concerned could implement
the recommendations. (footnotes omitted)
8.6 Pursuant to Article 19.1 of the DSU, having found the inconsistencies with the Anti-Dumping
Agreement set out above, we "recommend that [Mexico] br ing the measure into conformity with that
agreement".
8.7 Guatemala also requests that the Panel u se its discretion under Article 19.1 to make
suggestions as to the implementation of any recomme ndations. As third parties, the United States
asserts that the Panel should decline Guatemala's request, while the European Communities submits
that a panel may make suggestions where appropriate and that certain violations are so "fundamental"
that the only possible remedy would be revocation of the anti-dumping measure. Japan, too, would be
in favour of a Panel suggestion that Mexico revoke the anti-dumping measure due to the violations of
the initiation obligations.

8.8 In this respect, under paragraph 19.1 a panel "may", i.e., has discretion to, suggest ways in
which a Member could implement the recommendation that the Member concerned bring the measure
into conformity. Clearly, however, a panel is not required to make a suggestion.

8.9 In this case, we have found that Mexico h as not acted in a manner consistent with its
obligations concerning many of the steps in the in itiation and conduct of the investigation on imports
of steel pipes and tubes from Guatemala. In pa rticular, we have concluded that an unbiased and
objective investigating authority could not properly have determined, based on the evidence and
information available at the time of initiation, that there was sufficient evidence to justify initiation of
the anti-dumping investigation; and that Mexico conducted the anti-dumping investigation in a
manner inconsistent with its oblig ations relating to the determin ations of dumping, injury and
causation under various provisions of the Anti-Dumping Agreement . We consider these multiple
inconsistencies we have found to be fundamental and pervasive.
8.10 In this respect, we note that other panels have suggested that revocation would be an
appropriate route for implementation where they have found multiple, fundamental and pervasive
violations of the obligations governing the initiation and conduct of an inves tigation. For example,
the panel in Guatemala-Cement II determined that Guatemala had acted inconsistently with its
obligations under the Anti-Dumping Agreement in its imposition of anti-dumping duties on imports of
grey portland cement from Mexico, and found these violations to be of a "fundamental nature and
pervasive". That panel continued:
"In light of the nature and extent of the violations in this case, we do not perceive
how Guatemala could properly implement our recommendation without revoking the
anti-dumping measure at issue in this dispute. Accordingly, we suggest that
Guatemala revoke its anti-dumping measure on imports of grey portland cement from
Mexico." 466
8.11 Similarly, the Panel in Argentina – Poultry Anti-Dumping Duties stated:
"We have determined that Argentina has act ed inconsistently with its obligations
under the Anti-Dumping Agreement in its imposition of anti-dumping duties on
imports of eviscerated poultry from Brazil. We have found these violations to be of a
fundamental nature and pervasive.
In light of the nature and extent of the viol ations in this case, we do not perceive how
Argentina could properly implement our recommendation without revoking the anti-
dumping measure at issue in this dispute. Accordingly, we suggest that Argentina
repeal Resolution No. 574/2000 imposing definitive anti-dumping measures on
eviscerated poultry from Brazil."
467
8.12 Insofar as we find that Mexico has not act ed consistently with its obligations in the
various phases of the investigation and was in breach from the very outset of the
investigation, the Panel suggests revoking the anti-dumping measures applied to steel pipes
and tubes from Guatemala in order to implement properly the conclusions and
recommendations identified in this case.

466 Guatemala – Cement II, para. 9.6.

467 Argentina – Poultry Anti-Dumping Duties, paras. 8.3-8.7.

8.13 We find support for our decision to make th is suggestion in the previous panel reports we
have cited above. We emphasize, however, that it is the fundamental and pervasive nature of the
multiple inconsistencies that we have found in this case that motivate our decision to make our
suggestion.

IX. APPENDICES
APPENDIX 1

7 February 2006

 (06-0526)
 Original: English

Request for the Establishment of a Panel by Guatemala

 The following communication, dated 6 February 2006, from the delegation of Guatemala to
the Chairman of the Dispute Settlement Body, is circulated pursuant to Article 6.2 of the DSU.

 On 17 June 2005, Guatemala requested consultati ons with Mexico pursuant to Article 4 of the
Understanding on Rules and Procedures Governi ng the Settlement of Disputes (the "DSU"),
Article XXIII:1 of the General Agreement on Tariffs and Trade 1994 (the "GATT 1994") and
Article 17 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and
Trade 1994 (the "Anti-Dumping Agreement") regard ing the definitive anti-dumping measures
imposed by Mexico on imports of certain steel pi pes and tubes from Guatemala and the investigation
leading thereto.

 Guatemala and Mexico held consultations on 15 July, 26 August, and 28 September 2005.
These consultations unfortunately failed to resolve th e dispute. Accordingly, Guatemala respectfully
requests, pursuant to Article 6 of the DSU and Article 17.4 of the Anti-Dumping Agreement, that at
its next meeting on 17 February 2006, the Dispute Settlement Body establish a panel with the standard
terms of reference set out in Article 7.1 of the DS U to examine this matter and the claims set forth
below.

 The investigation leading to the imposition of the measures at issue was initiated by the
Mexican investigating authority, the Secretaría de Economía ("Economía")
1, on 24 August 2001.2

 On 13 March 2002, Economía issued a preliminary resolution, in which it found that the
imports under investigation were being dumped at ma rgins of 3.41 per cent for standard galvanized

1 The Secretaría de Economía is now known as the Ministerio de Economía.

de la República de Guatemala, independientemente del país de procedencia , 24 August 2001 (the "Initiation
Resolution").

pipes and tubes and 12.82 per cent for standard "b lack" pipes and tubes from known exporters, and
25.83 per cent and 26.59 per cent, respectively, from all other exporters, and that these dumped
imports were causing injury to the Mexican industry. 3 Thus, Economía imposed provisional anti-
dumping duties on those products at the above mentioned rates.

 On 13 January 2003, Economía issued its fina l resolution, in which it found dumping margins
of 29.93 per cent for standard galvanized pipes a nd tubes and 35.26 per cent for standard "black"
pipes and tubes, and that these imports were causing injury to the Mexican industry.
4 Accordingly,
using the lesser duty rule, Economía imposed defin itive anti-dumping duties at the rate of 25.87 per
cent for both galvanized and "black" pipes and tubes from all exporters.5

 Article 1 of the Anti-Dumping Agreement requi res that "[a]n anti-dumping measure shall be
applied only under the circumstances provided for in Article VI of GATT 1994 and pursuant to
investigations initiated and conducted in accordance with the provisions of [the Anti-Dumping]
Agreement." In the light of this requirement , and based on Article VI of the GATT 1994 and the
Anti-Dumping Agreement, Guatemala considers that Mexico's definitive anti-dumping duties and the
investigation leading thereto are inconsistent with Mexico's obligations under the provisions of the
Anti-Dumping Agreement hereinafter cited in the following respects:

Claims Relating to the Initiation of the Investigation

 (a) The application for the investigation fa iled to contain sufficient evidence either of
dumping, injury or a causal link to justify the initiation of an investigation. Mexico
then initiated the investigation without pr operly determining whether the application
for the investigation contained sufficient evidence of dumping, injury and a causal
link to justify the initiation, and without properly examining the accuracy and
adequacy of the evidence provided in the a pplication. These failures are inconsistent
with Articles 5.2, 5.3, and 5.8 of the Anti-Dumping Agreement.

Claims Relating to the Product under Consideration/Like Product

 (b) In the Initiation Resolution, Mexico provided a definition of the product under
consideration and the like product. During th e course of the investigation, however,
Mexico failed to adhere to and improper ly changed its definitions of the product
under consideration and the like product without any objective examination of
positive evidence regarding these definitions. As a result, Mexico failed to conduct
an unbiased and objective investigation and made findings of dumping, injury and a
causal link with respect to products that were not properly investigated. These
failures are inconsistent with Articles 2.1, 2.4, 2.6, 3.1, 3.2, 3.4, 3.5, 3.6, 4.1, 5.4, 6.4
and 6.9 of the Anti-Dumping Agreement.

país de procedencia, 13 March 2002 (the "Preliminary Resolution"), para. 197.

Ley de los Impuestos Generales de Importación y de Exportación, originarias de la República de Guatemala,
independientemente del país de procedencia, 13 January 2003 (the "Final Resolution"), paras. 115, 273.

5 Ibid., paragraph 275.

 (c) As a result of the changes to the defi nitions of the product under consideration and
the like product during the course of the i nvestigation, Mexico applied its final
measure to products that were not covered by its investigation and for which it had
not made determinations of dumping, injury, and a causal link. This is inconsistent
with Articles 2.1, 2.6, 3.1, 3.2, 3.4, 3.5, 9.1, 9.3 and 18.1 of the Anti-Dumping
Agreement.

Claims Relating to the Determination of Dumping

 (d) Mexico relied on facts available to dete rmine the margin of dumping for the largest
Guatemalan exporter of the subject products. Mexico lacked a basis under Article 6.8
of the Anti-Dumping Agreement to resort to facts available, and did so without
properly following the procedures laid out in Article 6.8 and Annex II to the Anti-
Dumping Agreement. These failures are incons istent with Articles 6.6, 6.8, 6.13, and
Annex II of the Anti-Dumping Agreement, as well as with the requirements of
Articles 2.1, 2.2, and 2.4 of the An ti-Dumping Agreement to conduct a fair
comparison between the export price and the normal value.

 (e) Mexico's report on the on-the-spot inves tigation of the largest Guatemalan exporter
contains no grounds to conclude that Mexico had encountered problems that justified
recourse to facts available under Article 6.8. Thus, Mexico failed to disclose to the
Guatemalan exporters that it had encountered problems at the on-the-spot
investigation that warranted the rejection of that exporters' data and the use of facts
available, contrary to Articles 6.2, 6.4, 6.6, 6.7 and 6.8 of the Anti-Dumping
Agreement. Mexico also failed to provid e any subsequent adequate explanation of
any problems it had encountered at the on-the-spot investigation or how those
problems justified its resort to facts availa ble. These failures are also inconsistent
with Articles 6.2, 6.4, 6.7, 6.8 and 6.9 of the Anti-Dumping Agreement.

 (f) Mexico made adjustments to the export price for certain categories of expenses
without making the symmetrical adjustme nts to the normal value for the same
categories of expenses that was necessary to achieve a fair comparison between the
normal value and the export price. This failu re is inconsistent with Articles 2.1, 2.2
and 2.4 of the Anti-Dumping Agreement.

Claims Relating to the Determination of Injury and a Causal Link

 (g) In its determination of injury and a causal link, Mexico relied on a period of
investigation that ended significantly befo re the initiation of the investigation and
therefore failed to take into account releva nt data relating to the period immediately
preceding its investigation, resulting in a determination of injury and a causal link
that was not based on an objective examinati on or positive evidence. This failure is
inconsistent with Articles 3.1, 3.2, 3.4 and 3.5 of the Anti-Dumping Agreement.

 (h) Mexico improperly limited its injury anal ysis to data relating to six-month periods
each year within the period of investigation, resulting in a determination of injury and
causal link that was not based on an objective examination or positive evidence. This
failure is inconsistent with Articles 3. 1, 3.2, 3.4 and 3.5 of the Anti-Dumping
Agreement.

 (i) Mexico selectively and inconsistently used data relating to different domestic
producers, products and groups or ranges of products, and time periods, in its analysis
of the volume and price effects of the impor ts under investigation, of the impact of

those imports on investigation on the domes tic industry, and of the causal link,
resulting in a determination of injury and causal link that was not based on an
objective examination or positive evidence. These failures are inconsistent with
Articles 3.1, 3.2, 3.4, 3.5, 3.6 and 4.1 of the Anti-Dumping Agreement.

 (j) Mexico's analysis of both the volume of the allegedly dumped imports and the effect
of those imports on prices in the domes tic market for like products, and the
consequent impact of those imports on th e domestic producers of such products, was
not based on an objective examination or positive evidence. These failures are
inconsistent with Articles 3.1 and 3.2 of the Anti-Dumping Agreement.

 (k) Mexico failed to evaluate properly all relevant economic factors and indices having a
bearing on the state of the domestic industry listed in Article 3.4, including, inter alia,
utilization of capacity, inventories, employme nt, wages, and growth. In addition to
its failure to consider properly particular listed factors, Mexico's overall analysis of
the factors listed in Article 3.4 did not conf orm to the standards of Article 3. These
failures are inconsistent with Articles 3.1 and 3.4 of the Anti-Dumping Agreement.

 (l) Mexico's analysis of the causal link between dumping and injury failed to analyse
properly other known factors, including, inter alia , changes in consumption, cost
increases, differences in production methods , technology, productivity, decline in
exports, and imports from other countries, that were at the same time causing injury
to the domestic industry, and failed to ensure that injury caused by those known
factors was not attributed to the imports under investigation. This failure is
inconsistent with Articles 3.1, 3.2, 3.4 and 3.5 of the Anti-Dumping Agreement.

Claims Relating to Procedural Matters

 (m) Mexico failed, before making its final determination, to inform the Guatemalan
exporters of the essential facts under consideration that formed the basis for its
decision to apply definiti ve measures, including, inter alia, the facts relating to the
decision to resort to facts available and to the definitions of the product under
consideration and the like product. This failure is inconsistent with Article 6.9 of the
Anti-Dumping Agreement.

 (n) Mexico failed to disclose in its prelimin ary and final resolutions in sufficient detail
the findings and conclusions reached on all issues of fact and law that were
considered material by the Mexican authorities, including, inter alia, the reasons for
Mexico's definition of the product under c onsideration and the like product and its
resort to facts available to calculate dumping margins for the largest Guatemalan
exporter. These failures are inconsistent with Article 12.2 of the Anti-Dumping
Agreement.

 (o) Mexico failed to require the applicants to provide non-confidential summaries and to
disclose properly information that was not shown upon good cause to be confidential
or to disclose non-confidential summaries of confidential information. These failures
are inconsistent with Article 6.5 of the Anti-Dumping Agreement.

 Guatemala considers that the foregoing methodologies, calculations, comparisons,
determinations and procedures made or used by th e Mexican authorities in their investigation and the
imposition of the measures referred to above cannot be reconciled with Article VI of the GATT 1994,
Articles 1 and 18.1 of the Anti-Dumping Agreement, or the specific provisions of the Anti-Dumping
Agreement cited above.

APPENDIX 2

27 September 2006
SUPPLEMENTAL WORKING PROCEDURES OF THE
PANEL CONCERNING CERTAIN BUSINESS
CONFIDENTIAL INFORMATION

1. Mexico shall submit to the Panel six copies and to Guatemala one copy of any information
designated as business confidential.

2. For the purposes of these proceedings, busin ess confidential information means any
information that is designated as such by the Pa rty submitting the latter and that is not information
accessible to the general public.

3. The party submitting business confidential informati on shall mark the cover and/or first page
of the document containing business confidential information, and each page containing such
information to indicate the presence of such inform ation. Specifically, the information in question
shall be placed between double brackets, as follows: [[xx,xxx.xx]]. The first page or cover of the
document shall state "Contains business confidential information on pages xxxxxx", and each page of
the document shall contain the same notice at the top of the page.

4. In addition to the requirements laid down in Article 18.2 of the DSU, Guatemala shall treat as
confidential the information that has been desi gnated as business confidential under these procedures;
i.e., Guatemala shall not disclose the information c ontained therein without the formal authorization
of Mexico. The parties shall have the responsibilit y for all members of their delegations, which, for
the purposes of these supplemental procedures only, shall not include any employee of any private
entity that was an interested party in the anti-dumpi ng investigation, and shall provide the other party
and the WTO Secretariat with a list of the names and functions of persons having access to such
information. In particular, no member of the dele gations of the parties shall disclose to any person
outside said delegations any information designate d as business confidential under these procedures,
and any such information must only be used fo r the purposes of submissions and argumentation in
this dispute and for no other purpose.

5. The parties and the Secretariat engage to keep business confidential information in a secure
location so as to ensure that it is used solely by persons authorized under these procedures.

6. Any party referring in its writte n submissions or oral statements to any information that has
been designated as business confidential under these procedures, shall clearly identify all such
information in those submissions and statements. All such written submissions shall be marked as
described in paragraph 2, above. An edited vers ion not containing any express reference to business
confidential information of any written submission containing business confidential information shall
be submitted to the Panel simultaneously with the version containing business confidential
information. In the case of an oral statement containing business confidential information, a written,
edited version not containing any ex press reference to such informa tion shall be submitted within a
day after the statement has been made. Non-confiden tial versions shall be redacted in such a manner
as to convey a reasonable understanding of the s ubstance of the business confidential information
deleted therefrom.

7. The Panel engages not to disclose, in its report, or in any other way, any information
designated as business confidential under these pro cedures. The Panel may, however, make
statements of conclusion drawn from such information.

8. Submissions containing information d esignated as business confidential under these
procedures will, however, be included in the record forwarded to the Appellate Body in the event of
any appeal of the Panel's Report.

9. Once the Panel proceedings have been complete d, in the event that the Panel’s Report has not
been appealed, or once the Appellate Body proceedi ngs have been completed, as the case may be, all
business confidential information received by the WTO Secretariat is to be returned to Mexico.