UNITED STATES – MEASURES RELATING TO ZEROING AND SUNSET REVIEWS
Document: Recourse to Article 21.5 of the DSU by Japan Final Report of the Panel
Date: 24 April 2009
Document codes: WT/DS322/RW
Complainant: Japan
Respondent: U.S.
Third parties: Argentina, China, EU, Hong Kong, India, South Korea, Mexico, New Zealand, Norway, Taiwan, Thailand
Dispute stage: Implementation & Compliance
Agreements cited: Art. 2.1, 2.4, 2.4.2, 9.1, 9.2, 9.3, 5.8, 3, 9.5, 11.1, 11.2, 11.3, 1  Anti-dumpingArt. VI  GATT 1994Art. 18.4  Anti-dumpingArt. XVI:4  Agreement Establishing the World Trade Organization

UNITED STATES – MEASURES RELATING TO ZEROING
AND SUNSET REVIEWS

Recourse to Article 21.5 of the DSU by Japan

Final Report of the Panel

I. INTRODUCTION
1.1 On 7 April 2008, Japan requested the establishment of a panel 1 pursuant to Article 21.5 of the
DSU concerning the United States' alleged failure to comply with the recommendations and rulings of
the DSB in the dispute US – Zeroing (Japan). At the 18 April 2008 DSB meeting, the DSB referred
this dispute to the original panel, if possible, in accordance with Article 21.5 of the DSU, to examine
the matter referred to the DSB by Japan in document
1.2 The Panel's terms of reference are the following:
To examine, in the light of the relevant pr ovisions of the covered agreements cited by
Japan in document , the matter re ferred to the DSB by Japan 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.
1.3 Due to the unavailability of the Chairman of th e original panel, the parties, on 23 May 2008,
agreed on a replacement panelist, and as a result the composition of the Panel is as follows:
1.4 Chairman: Mr. José Antonio Buencamino
 Members: Mr. Simon Farbenbloom
Mr. Raúl León-Thorne
1.5 China; the European Communities; Hong Ko ng, China; Korea; Mexico; Norway;
Chinese Taipei and Thailand reserved their rights to participate in the Panel proceedings as third
parties.
1.6 The Panel met with the parties on 4-5 Novemb er 2008. The meeting with the parties was
opened to public viewing. The Panel met with the third parties on 5 November 2008. A portion of
the Panel's meeting with the third parties was also opened to public viewing.
II. BACKGROUND
2.1 On 23 January 2007, the DSB adopted the reports of the Appellate Body 3 and the original
panel.4 Those reports contained the following findings:
• that by maintaining model zeroing procedures in the context of original investigations, the
United States acted inconsistently with Article 2.4.2 of the AD Agreement;5
• that the United States acted inconsistent ly with Articles 2.4 and 2.4.2 of the AD
Agreement by maintaining zeroing procedures when calculating margins of dumping on
the basis of transaction-to-transaction comparisons in original investigations;6
• that the United States acted inconsistently with Articles 2.4 and 9.3 of the AD Agreement
and Article VI:2 of the GATT 1994 by ma intaining zeroing procedures in periodic
reviews;7

1 WT/DS322/27.
2 WT/DS322/28.
3 Appellate Body Report, US – Zeroing (Japan).
4 Panel Report, US – Zeroing (Japan).
5 Panel Report, US – Zeroing (Japan), para. 7.258(a).
6 Appellate Body Report, US – Zeroing (Japan), para. 190(b).

• that the United States acted inconsistently with Articles 2.4 and 9.5 of the AD Agreement
by maintaining zeroing procedures in new shipper reviews;
8
• that by applying zeroing procedures in the anti-dumping investigation regarding imports
of cut-to-length carbon quality steel products from Japan, the United States acted
inconsistently with Article 2.4.2 of the AD Agreement;
9
• that the United States acted inconsistently with Articles 2.4 and 9.3 of the AD Agreement
and Article VI:2 of the GATT 1994 by appl ying zeroing procedures in 11 periodic
reviews; and10
• that the United States acted inconsistently with Article 11.3 of the AD Agreement when in
two sunset review determina tions it relied on margins of dumping calculated in previous
periodic review proceedings through the use of zeroing.11
2.2 The DSB recommended that the United States brin g its measures found to be inconsistent
with the AD Agreement and the GATT 1994 into conformity with the United States' obligations under
those agreements. On 4 May 2007, Japan and the Un ited States agreed, pursuant to Article 21.3(b) of
the DSU, that the United States should have a reasonable period of time of 11 months from the date of
the adoption of the reports in which to comply w ith the recommendations and rulings of the DSB.
That RPT expired on 24 December 2007.12
III. PARTIES' REQUESTS FOR FINDINGS AND RECOMMENDATIONS
3.1 Japan claims that the United States has failed to comply with certain of the recommendations
and rulings of the DSB. In particular, Japan requests the Panel to find that:
(a) with respect to the DSB's recommendations and rulings regarding the United States'
maintenance of the zeroing procedures challenged "as such" in the original
proceedings:

- the United States has failed to impl ement the DSB's recommendations and
rulings in the context of T-to-T comparisons in original investigations, and
under any comparison methodology in periodic and new shipper reviews,
which is inconsistent with the United States' obligations under Articles 17.14,
21.1, and 21.3 of the DSU in the sen se that these provisions aim at achieving
a satisfactory and prompt settlement of the matter; and,

- the United States' failure to do so is in continued violation of its obligations
under Article 2.4 of the AD Agreement and Article VI:2 of the GATT 1994;
as well as Article 2.4.2 of the AD Agreement with respect to T-to-T
comparisons in original investigations ; Article 9.3 with respect to periodic
reviews; and Article 9.5 with respect to new shipper reviews;

(b) with respect to the DSB's recommendations and rulings regarding the United States'
periodic reviews, that:

7 Appellate Body Report, US – Zeroing (Japan), para. 190(c).
8 Appellate Body Report, US – Zeroing (Japan), para. 190(d).
9 Panel Report, US – Zeroing (Japan), para. 7.258(b).
10 Appellate Body Report, US – Zeroing (Japan), para. 190(e).
11 Appellate Body Report, US – Zeroing (Japan), para. 190(f).
12 WT/DS322/20.

(i) in the case of five periodic reviews (Reviews 1, 2, 3, 7, and 8) 13 that were
found to be WTO-inconsistent in the original proceedings:

- the United States has failed to impl ement the DSB's recommendations and
ruling regarding the importer-specific assessment rates determined in those
Reviews, which is inconsistent with its obligations under Articles 17.14, 21.1,
and 21.3 of the DSU in the sense that these provisions aim at achieving a
satisfactory and prompt settlement of the matter; and

- the United States' failure to do so is in continued violation of its obligations
under Articles 2.4 and 9.3 of the AD Agreement , and Article VI:2 of the
GATT 1994;

(ii) in the case of four subsequent periodic reviews (Reviews 4, 5, 6 and 9),
14 15
which are measures taken to comply, the United States has acted
inconsistently with its obligations under Articles 2.4 and 9.3 of the AD
Agreement, and Article VI:216 of the GATT 1994; and

(c) with respect to the DSB's recommendations and rulings regarding the United States'
sunset review determination of 4 November 1999:

- the United States has failed to bring its WTO-inconsistent measure into
conformity with its WTO obligations , which is inconsistent with its
obligations under Articles 17.14, 21.1, and 21.3 of the DSU in the sense that
these provisions aim at achieving a satisfactory and prompt settlement of the
matter; and,

- the United States' failure to do so is in continued violation of its obligations
under Article 11.3 of the AD Agreement; and

13 Review 1 concerned Ball Bearings and Parts Thereof From Japan (1 May 1999 through
30 April 2000) (66 Fed. Re g. 36551, 12 July 2001) (As amended: 72 Fed. Reg. 67892, 3 December 2007)
(JTEKT and NTN). Review 2 concerned Ball Bearings and Parts Thereof From Japan (1 May 2000 through
30 April 2001) (67 Fed. Reg.55780, 30 August 2002) (A s amended: 73 Fed. Reg. 15481, 24 March 2008)
(NTN). Review 3 concerned Ball Bearings and Parts Thereof From Japan (1 May 2002 through 30 April 2003)
(69 Fed. Reg. 55574, 15 September 2004) (JTEKT, NSK, and NTN). Review 7 concerned Cylindrical Roller
Bearings and Parts Thereof From Japan (1 May 1999 through 31 December 1999) (66 Fed. Reg. 36551,
12 July 2001) (JTEKT and NTN) and Review 8 concerned Spherical Plain Bearings and Parts Thereof From
Japan (1 May 1999 through 31 December 1999) (66 Fed. Reg. 36551, 12 July 2001) (NTN).
14 Review 4 concerned Ball Bearings and Parts Thereof From Japan (1 May 2003 through
30 April 2004) (70 Fed. Reg. 54711, 16 September 2005)(As amended: 70 Fed. Reg. 61252, 21 October 2005
(NSK))(As amended: 70 Fed. Reg. 69316, 15 Novemb er 2005 (Nippon Pillow Block("NPB"))(JTEKT, NSK,
NPB, and NTN). Review 5 concerned Ball Bearings and Parts Thereof From Japan (1 May 2004 through
30 April 2005) (71 Fed.Reg. 40064, 14 July 2006) (JTEKT, NSK, NPB, and NTN) and Review 6 concerned
Ball Bearings and Parts Thereof From Japan (1 May 2005 through 30 April 2006) (72 Fed. Reg. 58053,
12 October 2007) (Asahi Seiko, JTEKT, NSK, NPB, and NTN). Review 9 concerned Ball Bearings and Parts
Thereof from Japan (Final Results for the Period 1 May 2006 – 30 April 2007) 73 Fed. Reg. 52823,
11 September 2008 (JTEKT, NPB, and NTN).
15 Review 9 was adopted by the Unite d States during the course of th is proceeding. The inclusion of
Review 9 in this proceeding is discussed infra at Section VI.B.2.
16 At para. 159(b)(ii) of its First Written Submission, Japan also included a claim under Article VI:1 of
the GATT 1994. Japan failed to develop that claim in any of its subsequent submissions or statements to the
Panel. Accordingly, we consider that Japan abandoned its claim under Article VI:1 of the GATT 1994.

(d) with respect to certain liquidation actions taken after the expiry of the RPT, the
United States acts in violation of Articles II:1(a) and II:1(b) of the GATT 1994.

3.2 The United States asks the Panel to find that the United States has complied with the
recommendations and rulings of the DSB and to reject Japan's claims to the contrary. The
United States asserts that the zeroing procedures challenged "as such" by Japan in the original
proceeding no longer exist, as on 27 December 2006 USDOC published a final notice announcing that
it would no longer apply the zeroing procedures in W-to-W comparisons in original investigations.
17
3.3 The United States submits that it complied w ith the DSB's recommendations and rulings
regarding Reviews 1, 2 and 3 by withdrawing the WTO-inconsistent cash deposit rates with
prospective effect, replacing them with new cash deposit rates determined in subsequent
administrative reviews. The United States denies that it was required to take any compliance action in
respect of the importer-specific assessment rates determined in Reviews 1, 2, 3, 7 and 8. Furthermore,
the United States asks for a preliminary ruling that Reviews 4, 5, 6 and 9 are not "measures taken to
comply" within the meaning of Article 21.5 of the DSU, and therefore fall outside the scope of this
proceeding. The United States also requests a prel iminary ruling that "subsequent closely connected
measures", including Review 9, are not within the Panel's terms of reference.
3.4 The United States asserts that it was not required to take any action to comply with the DSB's
recommendations and rulings regarding the 4 Nove mber 1999 sunset review, because the relevant
likelihood of dumping determinati on continues to be based on a number of dumping rates not called
into question by the findings of the Appellate Body.
3.5 The United States asks the Panel to exercise judici al economy in respect of Japan's Article II
claims. Furthermore, the United States asserts th at the anti-dumping liability giving rise to the
liquidation actions challenged by Japan was incurred prior to the expiry of the RPT.
IV. ARGUMENTS OF THE PARTIES
4.1 The arguments of the parties are set out in their written submissions and oral statements to the
Panel and their answers to the Panel's questions. The parties' submissions and oral statements, or their
executive summaries thereof, are attached to this report as annexes (see List of Annexes, pages iii
and iv).
V. ARGUMENTS OF THE THIRD PARTIES
5.1 China; the European Communities; Hong Ko ng, China; Korea; Mexico; Norway;
Chinese Taipei and Thailand reserved their rights to participate in the Panel proceedings as third
parties. China; Mexico; Chinese Taipei and Th ailand did not present written submissions. The
arguments of Korea are set out in its written submis sion and oral statement. The arguments of the
European Communities; Hong Kong, China and Norway are set out in their written submissions, oral
statements and in their answers to the Panel's qu estions. The arguments of China; Chinese Taipei and
Thailand are set out in their oral statements, while the arguments of Mexico are set out in its oral
statement and in its answers to the Panel's questions . The third parties' written submissions and oral
statements, or their executive summa ries thereof, are attached to this report as annexes (see List of
Annexes, pages iii and iv).

17 Antidumping Proceedings: Calculation of the Weighted Average Dumping Margin During an
Antidumping Investigation; Final Modification, 71 Fed. Reg. 77722, 77723 (USDOC, 27 December 2006).

VI. INTERIM REVIEW
6.1 The Panel submitted its interim report to the parties on 6 February 2009. On
27 February 2009, both parties requested that the Pane l revise precise aspects of the interim report.
Neither party requested an interim review me eting. On 13 March 2009, both parties submitted
comments on the other party's request for interim re view. The Panel has carefully considered the
arguments made by the parties in their requests for interim review and addresses them below, in
accordance with Article 15.3 of the DSU.
A. JAPAN'S COMMENTS ON THE INTERIM REPORT
6.2 Regarding para. 6.66 of the interim report, Japan asks the Panel to include references to two
other administrative reviews covered by the origin al proceeding that form part of the chain of
assessment for the 1989 Order. One of the admini strative reviews occurred before Review 1. The
other occurred between Reviews 2 and 3.
6.3 The United States objects to the changes proposed by Japan, on the basis that such changes do
not reflect arguments made by Japan during the course of the proceeding.
6.4 We have included the references proposed by Japan. Since the amendments reflect the factual
record, there is no merit in the United States' co mment that Japan failed to make any equivalent
arguments in its previous submissions to the Panel. Accordingly, we have amended paras. 7.65, 7.66
and para. 7.74 of our report. We have also deleted footnote 100 of the interim report.
6.5 Regarding para. 6.160 of the interim report, Japan asks the Panel to update the Exhibits the
Panel relies on as proof of zeroing in respect of Revi ews 4, 5, 6 and 9. Japan suggests that the Panel
should use the documents it provided in the Exhibit JPN-91 series, attached to its 26 November 2008
replies to questions from the Panel.
6.6 The United States objects to the use of the Exhi bit JPN-91 series. The United States asserts
that the revised programs included in the Exhibi t JPN-91 series were created by Japan for this
compliance proceeding, and Commerce has never employed these programs. The United States
contends that it would therefore be inappropriate to rely on the Exhibit JPN-91 series to demonstrate
Commerce's actions in the challenged anti-dumping administrative reviews.
6.7 We have included references to the Exhibit JPN- 91 series in para. 7.160 of our report. Since
the Exhibit JPN-91 series contains excerpts from the USDOC computer programme log, the
United States is incorrect to argue that these exhibits were created by Japan fo r this proceeding. To
the extent that we rely on other exhibits created by Japan for this proceeding, we explain the basis for
doing so at paras. 7.162 – 7.165 of our report.
6.8 In addition, Japan proposed a number of stylistic and/or typographical changes to the interim
report. The United States did not comment on any of these proposed changes. We have incorporated
the changes proposed by Japan into our final report.
B.
THE UNITED STATES' COMMENTS ON THE INTERIM REPORT
6.9 Regarding the last sentence of para. 6.8 of th e interim report, the United States asks the Panel
to clarify an alleged ambiguity in its text.
6.10 Japan does not object in principle to the cha nge proposed by the Unite d States. However,
Japan considers that the proposed text is overly na rrow, since it might exclud e the interpretation of
sources of law other than the covered agreements.

6.11 We have amended para. 7.8 of our report along the lines request ed by the United States. We
do not consider that the reference to the covered agreements is overly narrow since, in accordance
with Article 11.1 of the DSU, a panel's manda te is to make an objective assessment of the
applicability of and conformity with "the releva nt covered agreements", as opposed to broader
categories of legal texts.
6.12 The United States asks the Panel to make a seri es of changes to footnote 98 of the interim
report, on the basis that the Panel has misunderstood certain arguments made by the United States in
its First Written Submission.
6.13 Japan asks the Panel to reject the changes propo sed by the United States, on the basis that the
relevant text represents the Panel's own assessment of the US argument at issue. At the same time,
though, Japan proposes a number of ways in whic h the Panel might explain the basis for its
understanding of the relevant US arguments.
6.14 In order to avoid any uncertainty in the descr iption of our understanding of the United States'
arguments, we have deleted the relevant footnote from our report.
6.15 In respect of para. 6.79 of the interim report, th e United States asks the Panel to delete text
allegedly suggesting that the United States might have made a concession regarding the legal status of
Review 4.
6.16 Japan asks the Panel to reject the United States ' request, on the basis that the relevant text
represents the Panel's own assessment of the US argum ent at issue. At the same time, though, Japan
suggests ways in which the Panel might explain the basis for its assessment.
6.17 In light of the concern expressed by the United States, we have made a number of changes to
para. 7.79 of our report.
6.18 Regarding para. 6.124 of the interim report, the United States requests various changes to the
Panel's summary of US arguments concerning the scope of its implementation obligations.
6.19 Japan does not object to the cha nges requested by the United Stat es, except with regard to the
United States' apparent desire to delete footnote 144 of the interi m report. Japan asserts that
footnote 144 should be maintained, albeit in a differe nt location, since it reflects footnote 97 of the
United States' First Written Submission.
6.20 We have included the changes requested by the United States in para. 7.124 of our report.
We have preserved, but relocated, footnote 144 of the interim report.
6.21 The United States asks the Panel to revise the description of the United States' arguments
regarding certain amendments to Reviews 1, 2 and 3 set forth in the first sentence of footnote 148 of
the interim report. The United Stat es also asks the Panel to delete the last sentence of footnote 148 of
the interim report, which states that the United St ates has not formally challenged the inclusion of
these amendments in the proceeding.
6.22 Japan does not object to the proposed change to the description of the United States'
arguments. However, Japan does object to the request ed deletion of the last sentence of footnote 148.
Japan asserts that this sentence is accurate as drafted.
6.23 We have amended the first sentence of footnote 148 of our report. We have not deleted the
last sentence of that footnote. Although the United States argued that the amendments are not

relevant to this proceeding, this is not the same as requesting a preliminary ruling that the
amendments should be formally excluded from the scope of the proceeding.
6.24 The United States asks for a number of changes to the Panel's description of the United States'
arguments at paras. 6.159, 6.161 (including foot note 176) and 6.162 of the interim report. The
United States denies that it failed to dispute the s ubstance of Japan's claims against Reviews 4, 5, 6
and 9.
6.25 For the most part, Japan does not object to the changes requested by the United States, except
with regard to the proposed deletion of the second sentence of footnote 176 of the interim report.
Japan considers that the second sentence reflects the Panel's assessment of the US argument at issue.
In addition, Japan also asks the Panel to make findi ngs to the effect that individual importer-specific
assessment rates were affected by zeroing.
6.26 We have made the changes requested by the Unite d States, in order to avoid any error in our
description of the United States' arguments. We have also included the additional findings requested
by Japan. These changes and additional findings are reflected in paras. 7.159 – 7.166 of our report.
6.27 Regarding para. 6.188 of the interim report, the United States asks the Panel to clarify that
only certain Review 1, 2, 3, 7 and 8 entries were liquidated after expiry of the RPT.
6.28 Japan objects to the changes requ ested by the United States, on the basis that those changes
would improperly change the Panel's discussion from th e specific liquidation instructions at issue to
the general process of liquidation.
6.29 We have amended the penultimate sentence of pa ra. 7.192 of our report to clarify that our
findings only concern the liquidation instructions challenged by Japan.
6.30 The United States asks the Panel to delete the parenthetical from para. 6.196 of the interim
report (para. 7.200 of this report), to avoid the implication that the United States agrees with the
Panel's conclusion. The United States asserts that its jurisdictional arguments regarding Reviews 4, 5,
6 and 9 are equally applicable to the relevant liquidation measures.
6.31 Japan asks the Panel to reject the United Stat es' request, since the observation made by the
Panel in the parenthetical is correct.
6.32 We reject the change requested by the United States, for it is factually accurate that the
United States failed to claim that the liquidation measures are not "measures taken to comply".
6.33 Regarding para. 6.202 of the interim report (para. 7.206 of this report), the United States asks
the Panel to clarify that certain Review 1, 2, 3, 7 and 8 entries were liquida ted before the end of the
RPT.
6.34 Japan asks the Panel to reject the United Stat es' request, arguing that the fact that certain
entries may have been liquidated before the end of the RPT is irrelevant to its claims regarding the
liquidation measures issued after the end of the RPT.
6.35 We have not made the change requested by the United States. Japan's claim is based on the
liquidation measures issued after the end of the RP T. The fact that other liquidation measures may
have been issued before the end of the RPT is not relevant to Japan's claim.
6.36 In respect of para. 6.212 of the interim repor t, the United States asks the Panel to make a
series of changes to clarify the United States' arguments regarding the 1999 sunset review.

6.37 Japan does not object, in principl e, to the changes requested by the United States. However,
Japan encourages the Panel to clarif y that the United States is seeking to rely on "margins calculated
without zeroing" to justify the original 1999 sunset review, rather than any subsequent re-
determination.
6.38 We have amended para. 7.216 of our report to reflect the changes requested by the
United States. In order to avoi d any misunderstanding of the position taken by the United States in
this proceeding, we have also introduced the additional clarification proposed by Japan.
6.39 Regarding paras. 6.220 and 6.223 of the interi m report, the United States asks the Panel to
delete text suggesting that the United States conc urs that it was required to withdraw, modify or
replace the 1999 sunset review.
6.40 Japan asks the Panel to reject the deletion request ed by the United Stat es, since the relevant
text describes the Panel's assessment of the significance of a particular US argument.
6.41 Pursuant to the United States' comment, we have amended paras. 7.224 and 7.227 of our
report in light of the United States' argument that it was not required to modify that measure because
an independent WTO-consistent basis for the 1999 sunset review exists.
6.42 The United States also proposes a number of t echnical and typographical changes to the
interim report. Japan does not object to these chan ges. We have incorporated the technical and
typographical changes proposed by the United States into our report.
VII. FINDINGS
7.1 Before addressing the substance of Japan's cl aims, we shall make a number of general
remarks concerning our standard of review, the par ties' burden of proof, and treaty interpretation.
Thereafter, we shall consider a number of preliminar y issues raised by the parties. Once we turn to
the substance of Japan's claims, we shall address those claims in the following order: alleged failure to
comply in respect of Reviews 1, 2, 3, 7 and 8; alleged failure to comply in respect of Reviews 4, 5, 6
and 9; alleged failure to comply in respect of the zeroing procedures as such; alleged violation of
Article II of the GATT 1994; and alleged failure to comply in respect of the November 1999 sunset
review.
A.
STANDARD OF REVIEW / BURDEN OF PROOF / TREATY INTERPRETATION
1. Standard of Review
7.2 Panels generally are bound by the standard of review set forth in Article 11 of the DSU:
The function of panels is to assist the DSB in discharging its responsibilities under
this Understanding and the covered agreements. Accord ingly, 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 findi ngs as will assist the DSB in making the
recommendations or in giving the rulings pr ovided for in the covered agreements.
Panels should consult regularly with the parties to the dispute and give them adequate
opportunity to develop a mutually satisfactory solution.
7.3 There is no specific standard of review for Artic le 21.5 panels. However, there are specific
standard of review provisions for anti-dumping disputes, as set forth in Article 17.6 of the AD
Agreement:

 (i) in its assessment of the facts of the ma tter, the panel shall determine whether the
authorities' establishment of the facts w as 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 relevant provisions of the Agreement in accordance with
customary rules of interpretation of public international law. Where the panel finds
that a relevant provision of the Agreemen t admits of more than one permissible
interpretation, the panel shall find the author ities' measure to be in conformity with
the Agreement if it rests upon one of those permissible interpretations.

2. Burden of Proof
7.4 The DSU does not include any express rule concerning the burden of proof in panel
proceedings. However, the Appellate Body has found that the concept of burden of proof is implicit
in the WTO dispute settlement system. In short, the burden of proof rests upon the party, whether
complaining or defending, who asserts the affirmative of a particular claim or defence. If that party
adduces evidence sufficient to raise a presumption that what is claimed is true and thus makes a prima
facie case18, the burden shifts to the other party, who will fail unless it adduces sufficient evidence to
rebut the presumption.19
7.5 The Appellate Body has provided the following guidance regarding the burden of proof in
Article 21.5 proceedings:
Neither Chile nor Argentina suggests that the general rules on burden of proof, which
imply that a responding party's measure w ill be treated as WTO-consistent unless
proven otherwise, do not apply in proceedi ngs under Article 21.5 of the DSU. We
observe, in this regard, that Article 21.5 proceedings do not occur in isolation from
the original proceedings, but that both pr oceedings form part of a continuum of
events. The text of Article 21.5 expressly links the "measures taken to comply" with
the recommendations and rulings of the DS B concerning the original measure. A
panel's examination of a measure taken to comply cannot, therefore, be undertaken in
abstraction from the findings by the original panel and the Appellate Body adopted by
the DSB. Such findings identify the WTO-in consistency with respect to the original
measure, and a panel's examination of a me asure taken to comply must be conducted
with due cognizance of this background. Thus, the adopted findings from the original
proceedings may well figure prominently in proceedings under Article 21.5,
especially where the measure taken to comply is alleged to be inconsistent with WTO
law in ways similar to the original measure. In our view, these considerations may
influence the way in which the complaining party presents its case, and they may also
be relevant to the manner in which an Article 21.5 panel determines whether that
party has discharged its burden of proof and established a prima facie case.
20
7.6 At paras. 24 – 27 of its First Written Submission, the United States argues that Japan must
meet the burden of proof on all aspects of its claims. In an answer to a question from the Panel, the

18 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.
Appellate Body Report, EC – Hormones, para. 104.
19 Appellate Body Report, US – Wool Shirts and Blouses , p. 14. See also Appellate Body Report,
Japan – Apples, para. 154; Appellate Body Report, Canada – Dairy (21.5 – New Zealand) (II), para. 66.
20 Appellate Body Report, Chile – Price Band System (21.5 - Argentina), para. 136 (footnotes omitted).

United States also explains that to the extent that Japan claims that Reviews 4, 5, 6 and 9 make use of
allegedly WTO-inconsistent "zeroing", it is for Jap an to explain and prove what Japan means by
"zeroing" in this context; that such "zeroing" in fact occurred in each review; and that "zeroing" (in its
view) is WTO-inconsistent. Japan contends that th e burden of proof applies solely to factual matters,
and not legal interpretation.
21 We note in this regard that in EC – Tariff Preferences, the Appellate
Body held:22
We are therefore of the view that the European Communities must prove that the
Drug Arrangements satisfy the conditions set out in the Enabling Clause. Consistent
with the principle of jura novit curia , it is not the responsibility of the
European Communities to provide us with th e legal interpretation to be given to a
particular provision in the Enabling Clause; instead, the burden of the
European Communities is to adduce sufficien t evidence to substantiate its assertion
that the Drug Arrangements comply with the requirements of the Enabling Clause.
7.7 In a footnote to this passage, the Appellate Body quoted the International Court of Justice's
interpretation of jura novit curia, namely:23
It being the duty of the Court itself to ascer tain and apply the relevant law in the
given circumstances of the case, the burden of establishing or proving rules of
international law cannot be imposed upon any of the parties, for the law lies within
the judicial knowledge of the Court.
7.8 The Appellate Body's reasoning in EC – Tariff Preferences was accepted by the panel in EC –
Sugar Subsidies, where the panel held that, for issues of le gal interpretation, "t here is no burden of
proof as such" and it is always for the panel to provide the appropriate legal interpretation
independently of what is put forward by any party.
24 We agree that there is no burden of proof for
issues of legal interpretation of provisions of the covered agreements.
3. Treaty Interpretation
7.9 Article 3.2 of the DSU directs panels to clarify the existing provisions of the covered
agreements "in accordance with customary rules of in terpretation of public international law". It is
well settled in the WTO dispute settlement system th at the principles codified in Articles 31, 32
and 33 of the Vienna Convention on the Law of Treaties are such customary rules. These provisions
read as follows:
Article 31: General rule of interpretation

1. A treaty shall be interpreted in goo d faith in accordance with the ordinary
meaning to be given to the terms of the trea ty in their context and in the light of its
object and purpose.

2. The context for the purpose of the interpretation of a treaty shall comprise, in
addition to the text, including its preamble and annexes:

21 Japan's Comments on US Replies, para. 2. Japan relies in this regard on Appellate Body Report, EC
– Tariff Preferences, footnote 220 to paragraph 105; and Panel Report, EC – Sugar Subsidies, para. 7.121.
22 Appellate Body Report, EC –Tariff Preferences, para. 105.
23 Appellate Body Report, EC –Tariff Preferences, para. 105, footnote 220.
24 Panel report, EC –Sugar Subsidies, para. 7.121 and footnote 437.

(a) any agreement relating to the tr eaty which was made between all the
parties in connection with the conclusion of the treaty;
(b) any instrument which was made by one or more parties in connection
with the conclusion of the treaty and accepted by the other parties as
an instrument related to the treaty.

3. There shall be taken into account, together with the context:

(a) any subsequent agreement between the parties regarding the
interpretation of the treaty or the application of its provisions;
(b) any subsequent practice in the application of the treaty which
establishes the agreement of the parties regarding its interpretation;
(c) any relevant rules of internati onal law applicable in the relations
between the parties.

4. A special meaning shall be given to a term if it is established that the parties
so intended.

Article 32: Supplementary means of interpretation

Recourse may be had to supplementary me ans of interpretation, including the
preparatory work of the treaty and the circumstances of its conclusion, in order to
confirm the meaning resulting from the application of article 31, or to determine the
meaning when the interpretation according to article 31:

(a) leaves the meaning ambiguous or obscure; or
(b) leads to a result which is ma nifestly absurd or unreasonable.

Article 33: Interpretation of treaties authenticated in two or more languages

1. When a treaty has been authenticated in two or more languages, the text is
equally authoritative in each language, unless the treaty provides or the parties agree
that, in case of divergence, a particular text shall prevail.

2. A version of the treaty in a language other than one of those in which the text
was authenticated shall be considered an au thentic text only if the treaty so provides
or the parties so agree.

3. The terms of the treaty are presumed to have the same meaning in each
authentic text.

4. Except where a particular text preva ils in accordance with paragraph 1, when
a comparison of the authentic texts discloses a difference of meaning which the
application of articles 31 and 32 does not remove, the meaning which best reconciles
the texts, having regard to the object and purpose of the treaty, shall be adopted.

7.10 Article 19.2 of the DSU further clarifies that in their findings and recommendations, panels
and the Appellate Body "cannot add to or diminish the rights and obligations provided in the covered
agreements".
B. PRELIMINARY ISSUES
7.11 The parties have raised several preliminary issues which we address in two parts.

7.12 First, we address the United States' request fo r a preliminary ruling that the Panel does not
have jurisdiction over Reviews 4, 5 and 6 because th ey are not "measures taken to comply" within the
meaning of Article 21.5 of the DSU.
7.13 Second, we address the United States' request fo r a preliminary ruling that part of Japan's
request for establishment of the Panel does not meet the specificity requirement of Article 6.2 of the
DSU. We address this request in the context of a request by Japan that we include Review 9, which
was adopted after establishment of the Panel, in the scope of these proceedings.
1. Are Reviews 4, 5 and 6 "measures taken to comply" within the meaning of Article 21.5
of the DSU?
7.14 Article 21.5 of the DSU provides:
Where there is disagreement as to the ex istence or consistency with a covered
agreement of measures taken to comply with the recommendations and rulings such
dispute shall be decided through recourse to these dispute settlement procedures,
including wherever possible resort to the or iginal panel. The panel shall circulate its
report within 90 days after the date of refe rral of the matter to it. When the panel
considers that it cannot provide its report within this time frame, it shall inform the
DSB in writing of the reasons for the delay together with an estimate of the period
within which it will submit its report.
7.15 There is no disagreement between the parties that, by virtue of the first sentence of
Article 21.5 of the DSU, the jurisdiction of the Pa nel is restricted to instances in which there is
disagreement over the existence or consistency wi th a covered agreement of "measures taken to
comply with the recommendations and rulings" of the DSB. The disagreement between the parties
hinges on the issue of whether or not Reviews 4, 5 and 6 constitute "measures taken to comply"
within the meaning of Article 21.5 of the DSU.
7.16 There follows a summary of the parties' main arguments regarding this jurisdictional issue.
(a) Main arguments of the parties: Japan
7.17 Japan submits that Reviews 4, 5 and 6 are prope rly within the scope of this proceeding
because they are "measures taken to comply" within the meaning of Article 21.5 of the DSU. Japan
advances two arguments in support of its position. First, Japan asserts that the United States has
declared that Reviews 4, 5 and 6 are "measures take n to comply". Second, Japan relies on the nexus-
based test applied in US – Softwood Lumber IV (21.5 - Canada).
(i) Reviews 4, 5 and 6 as declared "measures taken to comply"
7.18 Japan submits that the United States' own s ubmissions to the Panel contain repeated
declarations that Reviews 4, 5 and 6 are "measures take n to comply". Japan notes in this regard that
the United States argues that the periodic reviews at issue in the original proceedings were
"withdrawn",
25 "superceded", 26 "eliminated", 27 "replaced" 28 and "removed" 29 by the subsequent

25 United States, Second Written Submission, para. 28; United States, First Written Submission,
paras. 39, 52, 54, 58, 65, 66, 67.
26 United States, First Written Submission, paras. 3, 44.
27 United States, Second Written Submission, para . 8; United States, First Written Submission,
paras. 44, 54.
28 United States, Second Written Submission, para. 18; United States, First Written Submission,
para. 44.

periodic reviews challenged by Japan in these comp liance proceedings. Japan attaches particular
significance to the United States' assertion that, with the adoption of the subsequent reviews, it "has
taken measures to comply with [the DSB's] recommendations and rulings". 30 Japan also refers to the
United States' assertion that, with the subseque nt reviews, "compliance was accomplished". 31 Japan
contends that the United States even holds out th e subsequent periodic reviews as evidence that
"measures taken to comply" do indeed exist:
As to the existence of measures taken to comply, the United States has shown that the
United States removed the WTO-inconsiste nt cash deposit rate for entries of
merchandise occurring on or after the date of implementation. This compliance was
accomplished as an incidental consequence of the U.S. antidumping duty system,
where the cash deposit rate from one review is replaced by that from a subsequent
review.32
7.19 Japan does not dispute that the United States is entitled to rely on the subsequent periodic
reviews as evidence for its assertion that the orig inal reviews have been "withdrawn" "within the
meaning of DSU Article 3.7",33 and that the United States is entitled to argue that, with the subsequent
reviews, "compliance was accomplished". Japan also accepts that the United States is entitled to use
the subsequent reviews to respond to Japan's clai m that no "measures taken to comply" exist.
According to Japan, this entitlement flows from a harmonious interpretation of Articles 3.7, 19.1
and 21.5 of the DSU, whereby an implementing Member must be able to rely on measures that
"withdraw" the original measures to demonstrate that "measures taken to comply" exist.
34
7.20 Japan contends, however, that where an implementing Member relies on a measure to meet a
claim that no "measures taken to comply" exis t, the same harmonious interpretation of these
provisions requires a panel, upon request, to exam ine the WTO "consistency" of that measure.
According to Japan, therefore, from the perspec tive of Article 21.5, where subsequent periodic
reviews are offered to rebut arguments "as to the existence of measures taken to comply", 35 these
measures cannot be anything but "measures taken to comply", which Article 21.5 directs the Panel to
review for their consistency with the covered agreements.
(ii) The nexus-based test
7.21 Japan contends that, even if Reviews 4, 5 and 6 are not treated as declared "measures taken to
comply", those measures fall within the jurisdiction of the Panel by virtue of the nexus-based test
applied in various WTO dispute settleme nt cases, including in particular US – Softwood Lumber IV
(21.5 - Canada). Japan submits that, by virtue of the ne xus-based test, new measures (i.e., other than
those at issue in the original proceedings), not recognized by the respondent as "measures taken to
comply", have been found to be covered by Article 21.5 (a) because of a close relationship to the
DSB's recommendations and rulings regarding th e original measures and (b) because the new
measures undermine compliance with those recommendations and rulings.
7.22 Japan contends that three measures were at issue in US – Softwood Lumber IV (21.5 -
Canada): (i) the original investigation that was the subject of the DSB's recommendations and rulings;
(ii) a "Section 129 Determination" replacing the or iginal investigation (which the United States

29 United States, Second Written Submission, paras. 18, 26.
30 United States, First Written Submission, para. 51.
31 United States, Second Written Submission, para. 18; United States, First Written Submission,
paras. 52, 67.
32 United States, Second Written Submission, para. 18 (emphasis in original).
33 United States, First Written Submission, para. 52.
34 Japan, Second Written Submission, paras. 24-25.
35 United States, Second Written Submission, para. 18 (emphasis in original).

declared as the "measure taken to comply" under Article 21.5 of the DSU); and, (iii) the First
Assessment Review (i.e., the first administ rative review following the imposition of the
countervailing duty order), which the United States argued was not a "measure taken to comply"
under Article 21.5 of the DSU. Japan asserts that, in finding that the First Assessment Review did
constitute a "measure taken to comply", the Appellate Body assessed the nature of the relevant
measures, and attached importance to the fact that: (a) the measures all resulted from "countervailing
duty proceedings conducted by the [USDOC]"; (b) the measures all involved the same type of
determination by the USDOC, namely subsidization; (c) the measures all concerned the same product;
and, (d) the measures all involved the same disputed issue, that is, the so-called "pass-through" aspect of
the USDOC's subsidy calculation methodology.
36 Japan states that the Appellate Body also found that
a substantive connection existed between the th ree measures because they provided succeeding bases
for the "continued imposition" of counterva iling duties on imports of the subject product, 37 in the
sense that the original investig ation measure was "superseded" 38 by the Section 129 Determination,
which was, in turn, "superseded" by the new periodi c review. Japan asserts that both the panel and
the Appellate Body focused on the shared connection that the three measures had with respect to one
particular disputed element of each measure, with the Appellate Body emphasizing that Canada was
challenging "a specific component" of each measure, namely a calculation methodology.39 According to
Japan, the Appellate Body further agreed with th e compliance panel's finding that this specific
component of the periodic review, which "was 'so inextricably linked' and 'clearly connected' to both the
Section 129 Determination and th e Final Countervailing Duty Dete rmination [i.e., the original
investigation]," fell within the scope of the Article 21.5 proceeding.40
7.23 Japan contends that the Appellate Body, like the compliance panel, also examined the
"effects" of the new periodic review on the United States' compliance with the DSB's
recommendations and rulings (through the Secti on 129 Determination). Japan notes that the
Article 21.5 panel concluded that the periodic revi ew "impact[ed]", and "possibly undermined", the
United States' implementation of the DSB's recommendations and rulings (through the adoption of the
Section 129 Determination).
41 Japan further notes that the Appellate Body found that:
The First Assessment Review also directly affected the Section 129 Determination
because the cash deposit rate resulting fro m the Section 129 Determination . . . was
'updated', or 'superseded', by the cash depos it rate resulting from the First Assessment
Review . . . . Even if, as the United States argues, modification of the cash deposit
rate was not the purpose of the First Assessment Review, it was undeniably an
effect.
42
7.24 Japan submits that, in commenting on its findings in US – Softwood Lumber IV (21.5 -
Canada), the Appellate Body in US – Upland Cotton (21.5 - Brazil) 43 noted that the First Assessment
Review was a "measure taken to comply" because of its particularly close relationship to the
Section 129 Determination,44 and emphasized that new measures ar e regarded as "taken to comply"

36 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 83.
37 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 83.
38 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 85.
39 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 83.
40 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 81.
41 Panel Report, US – Softwood Lumber IV (21.5 - Canada), para. 4.41.
42 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada) , para. 85 (internal citation
omitted) (emphasis in original).
43 Appellate Body Report, US – Upland Cotton (21.5 - Brazil).
44 Appellate Body Report, US – Upland Cotton (21.5 - Brazil), para. 205.

when they have "the effect of undermining compliance with the DSB's recommendations and rulings",
or where justified "to avoid circumvention" of those recommendations and rulings.45
7.25 Japan further submits that the Appellate Body in US – Upland Cotton (21.5 - Brazil) added
that Article 21.5 must be interpreted to prev ent the implementing Member from undermining the
substantive disciplines in the covered agreements and also the dispute settlement mechanism in the
DSU.46 Japan asserts that, if new subsidy payments identical to those at issue in the original
proceedings had been excluded from the scope of Article 21.5, this would make the DSB's
recommendations and rulings "essentially declaratory in nature", and create an endless cycle of never-
ending litigation, with no implementation of the outcome forthcoming.
47 Japan also asserts that the
Appellate Body has explained that its approach to Article 21.5 strikes a balance between competing
considerations, taking into account , among others, that the provision "seeks to promote the prompt
resolution of disputes, to avoid a complaini ng Member having to initiate dispute settlement
proceedings afresh when an original measure f ound to be inconsistent has not been brought into
conformity with the recommendations and rulings of the DSB, and to make efficient use of the
original panel and its relevant experience."48
7.26 In seeking to apply the US – Softwood Lumber IV (21.5 - Canada) reasoning in respect of
Reviews 4, 5 and 6, Japan focuses on (a) the relati onship between Reviews 4, 5 and 6 and the reviews
at issue in the original proceedi ng, and (b) the effect of Reviews 4, 5 and 6 on the United States'
compliance with the recommendations and rulings of the DSB.
The relationship between Reviews 4, 5 and 6 and the administrative reviews at issue in the original
proceeding

7.27 Japan asserts that the original and subsequent periodic reviews have essentially the same
connections that led the Appe llate Body to conclude in US – Softwood Lumber IV (21.5 - Canada)
that a "particularly close relationship" existe d between the three measures at issue in those
proceedings:
• the original and subsequent measures all resulted from anti-dumping proceedings
conducted by the USDOC and, in particular , the same type of proceeding, namely
periodic reviews;

• the three subsequent reviews were all conducted pursuant to the same 1989 Anti-
Dumping Order, and they all, therefore, concern the same subject product as the three
relevant periodic reviews challenged in the original proceedings; and,

• the original and subsequent reviews c oncern dumping determinations made with
respect to exports from the same companies.

7.28 Japan contends that, like the measures at issue in US – Softwood Lumber IV (21.5 - Canada) ,
a substantive relationship exists because the origin al and subsequent administrative reviews provide
succeeding bases for the continued imposition of anti -dumping duties on ball bearings, with each new
review (i) establishing a cash deposit rate that replaced the cash deposit rate from the previous review,
and (ii) determining the definitive duty ( i.e., importer-specific assessment rate) for entries initially
subjected to the cash deposit rate from a prior review . According to Japan, in substantive terms the

45 Appellate Body Report, US – Upland Cotton (21.5 - Brazil), para. 205.
46 Appellate Body Report, US – Upland Cotton (21.5 - Brazil), paras. 245-246.
47 Appellate Body Report, US – Upland Cotton (21.5 - Brazil), paras. 245-246.
48 Appellate Body Report, US – Softwood Lumber IV (21.5 - Brazil), para. 72. See also Appellate Body
Report, US – OCTG from Argentina (21.5 - Argentina), para. 151.

various measures form an unbroken chain of measu res flowing from a single anti-dumping order.
Japan also contends that, consistent with US – Softwood Lumber IV (21.5 - Canada) , it only contests
"a specific component" of the three subsequent periodic reviews, namely, the zeroing methodology
used to make the dumping determinations.
49
7.29 Japan further submits that an important tempor al relationship also exists between the three
subsequent periodic reviews and the DSB's recomme ndations and rulings: in the case of each of the
three reviews, the United States had not collected definitive anti-dumping duties on certain entries
covered by these reviews at the end of the reasonable period of time ("RPT"). Japan asserts that, as a
result, the United States will apply the WTO-inconsistent importer-specific assessment rate
determined in these reviews after the end of the RPT.
The effect of the subsequent administrative reviews on compliance

7.30 Relying on the words of the Appellate Body in US – Upland Cotton (21.5 - Brazil) , Japan
asserts that the three subsequent reviews have "the effect of undermining compliance", and
"circumvent[ing]" the DSB's recommendations and rulings.
50 Japan contends that, instead of revising
the cash deposit and importer-specific assessment ra tes established in the original reviews, the
United States simply replaced51 those rates with new rates determined in the subsequent reviews using
the same WTO-inconsistent zeroing methodology. A ccording to Japan, therefore, the measures found
to be WTO-inconsistent have been withdrawn and replaced by new measures that simply perpetuate
the WTO-inconsistency that the United States was ob liged to eliminate. Japan submits that the
United States itself informed the DSB that the ne w periodic reviews had "superseded" the original
periodic reviews.
7.31 Japan contends that, if the subsequent review s are excluded from the scope of Article 21.5 of
the DSU, the United States could disregard the DSB's recommendations and rulings with impunity,
and the DSB's recommendations and rulings w ould be "essentially declaratory in nature". 52 Japan
asserts that one set of WTO-inconsistent measures could simply be replaced by another set of
substantively related measures th at include the same WTO-inconsistency, and an endless cycle of
never-ending litigation would ensue.
(b) Main arguments of the parties: United States
7.32 The United States asks for a preliminary ruling that Reviews 4, 5 and 6 are not "measures
taken to comply", declared or otherwise, and therefore fall outside the Panel's terms of reference. The
United States also disputes the relevance of the di spute settlement reports cited by Japan in support of
its jurisdictional arguments, including US – Softwood Lumber IV (21.5 - Canada) , and denies the
existence of any comprehensive standard, such as a "nexus-based test".

49 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 83.
50 Appellate Body Report, US – Upland Cotton (21.5 - Brazil), para. 205.
51 Japan asserts that there are two aspects to the way in which the subsequent reviews replaced the cash
deposit rates determined in the original reviews. First, the original cash deposit rates applied prospectively to
entries occurring after the original review was adopted; that rate was superseded on a prospective basis by a new
cash deposit rate determined in a subsequent review, whic h was, in turn, superseded by later cash deposit rates.
Second, although the cash deposit rate established in the original reviews applied prospectively to entries at the
time of importation, that rate was su bsequently replaced for certain entrie s by an importer-specific assessment
rate established in the subsequent reviews. Japan assert s that, in these two respects, the original reviews were
effectively withdrawn, and replaced, by new WTO-inconsistent rates determined in the subsequent reviews.
52 Appellate Body Report, US – Upland Cotton (21.5 - Brazil), para. 246.

(i) Reviews 4, 5 and 6 as declared "measures taken to comply"
7.33 The United States denies that it has expressly stat ed that Reviews 4, 5 and 6 are "measures
taken to comply". According to the United States, saying that the results of one administrative review
are superseded by the results of another administra tive review is not the same thing as saying that the
subsequent review was a "measure taken to comply" within the meaning of Article 21.5 of the DSU.
The United States contends that the measures subject to the DSB's recommendations and rulings were
eliminated as an incidental consequence of the US antidumping system when the cash deposit rate
from one review was replaced by the cash deposit rate from the next review. According to the
United States, this fact does not somehow transform the subsequent reviews into "measures taken to
comply."
7.34 The United States rejects Japan's argument that , because the United States announced that the
results of the original administrative reviews we re "superseded" by subsequent reviews, those
subsequent reviews should be treated as measures take n to comply. The United States asserts that the
original reviews were superseded by subsequent reviews because the cash deposit rate from one
review was replaced by the cash deposit rate from th e next review. According to the United States,
the measures subject to the DSB recommendations and rulings were therefore eliminated as an
incidental consequence of a subsequent administrative review. The United States contends that this is
not the same thing as saying that the subsequent review is a measure taken to comply.
(ii) The nexus-based test
The relationship between Reviews 4, 5 and 6 and the administrative reviews at issue in the original
proceeding

7.35 The United States asserts that Reviews 4, 5 and 6 have no connection with the DSB's
recommendations and rulings. The United States cont ends that Japan misunderstands the Appellate
Body's findings in US – Softwood Lumber IV (21.5 - Canada) . The United States notes that the
Appellate Body stated in that dispute, "not...eve ry assessment review will necessarily fall within the
jurisdiction of an Article 21.5 panel", 53 and that "such an approach would be too sweeping." 54 The
United States asserts that the Panel should reject Jap an's attempt to include the relevant subsequent
reviews just because they are administrative revi ews involving the same pr oduct exported from Japan
by the same companies. According to the Unite d States, if the overlap between product, exporting
country, and exporting company were sufficient to establish the type of "particularly close
relationship" found in US – Softwood Lumber IV (21.5 - Canada) , then every administrative review
would fall within the jurisdiction of an Article 21.5 panel – contrary to the Appellate Body's
admonition. The United States argues, moreover, that the fact that each new review "establish[es] a
cash deposit rate that replace[s] the cash deposit ra te from the previous review" and "determin[es] the
definitive duty...rate for entries initially subjected to the cash deposit rate from a prior review"
55 does
not support Japan's argument; otherwise, every succeeding administrative review would be considered
a measure taken to comply.
7.36 The United States asserts that Japan, in relying on US – Softwood Lumber IV (21.5 - Canada),
ignores the differences between the two disputes. The United States asserts that, in making its finding
in US – Softwood Lumber IV (21.5 - Canada) , the Appellate Body considered the timing between the
two determinations at issue, in the sense that th e determinations in the Section 129 proceeding – the
declared measure taken to comply – and the First Assessment Review both occurred after the adoption
of the DSB's recommendations and rulings, and bot h closely corresponded to the expiration of the

53 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 93 (footnote omitted).
54 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 87 (footnote omitted).

RPT.
56 The United States asserts that the timing of these two determinations thus provided USDOC
with the ability to take account of the DSB's recomm endations and rulings in the first administrative
review, and as the Appellate Body emphasized, the United States expressly acknowledged that
USDOC used the same pass-through analysis in the fi rst administrative review as in the Section 129
Determination "in view of" the DSB's recommendations and rulings.57
7.37 The United States contends that the situation in this dispute does not resemble the situation in
US – Softwood Lumber IV (21.5 - Canada). The United States asserts that two of the three subsequent
determinations (Reviews 4 and 5) were made well before the adoption of the DSB's recommendations
and rulings, such that these subsequent determin ations could not logica lly have taken into
consideration the recommendations and rulings of the DSB in the original dispute. The United States
submits that these two measures therefore have no connection with the DSB's recommendations and
rulings. According to the United States, measures taken by a Member prior to adoption of a dispute
settlement report typically are not taken for the purpose of achieving compliance and would not be
within the scope of an Article 21.5 proceeding. The United States notes in this regard that the
Appellate Body has found that "[a]s a whole, Article 21 deals with events subsequent to the DSB's
adoption of recommendations and rulings in a particular dispute".58
7.38 The United States acknowledges that USDOC issued its final results in Review 6 after the
adoption of the DSB's recommendations and rulings, but asserts that this determination (dated
12 October 2007) did not occur around the same time as US withdrawal of the administrative reviews
subject to the DSB's recommendations and rulings, 59 and did not closely correspond to the expiration
of the RPT (on 24 December 2007). The United St ates further asserts that, most importantly, unlike
the First Assessment Review in US – Softwood Lumber IV (21.5 - Canada), Review 6 did not
incorporate elements from a Section 129 Determin ation "in view of" the DSB's recommendations and
rulings.
The effect of the subsequent administrative reviews on compliance

7.39 Noting Japan's argument that the three administrative reviews "undermine" and "circumvent"
the US compliance with the DSB's recommendations and rulings, the United States asserts that this
dispute is distinguishable from disputes in which panels and the Appellate Body found subsequent
measures to undermine the declared measure taken to comply. In particular, the United States asserts
that the respondent Members chose to take the "measures taken to comply" at issue in Australia –
Leather (21.5 - US) 60 and Australia – Salmon (21.5 – Canada), 61 whereas none of the three
administrative reviews at issue was a voluntary ac tion taken by the United States around the time of
implementation to circumvent or undermine decl ared compliance with the DSB's recommendations
and rulings. The United States asserts that admini strative reviews occur upon request of interested
parties on a schedule that is established without rega rd to dispute settlement proceedings, pursuant to
rights and obligations established in the AD Agreement.
7.40 Regarding Japan's reliance on the Appellate Body report in US – Upland Cotton (21.5 -
Brazil), the United States asserts that Japan misunde rstands the relevance of that report. The
United States asserts that that dispute involved Brazil's prohibited and actionable subsidy claims

56 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 84.
57 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada) , para. 84 (citing US additional
memorandum, para. 12).
58 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 70 (emphasis in original).
59 The United States asserts that the cash deposit rate for the most recent review that was subject to the
DSB's recommendations and rulings, namely Review 3, was replaced by the cash deposit from Review 4
in 2005, around two years before the results of Review 6 review were announced.
60 Panel Report, Australia – Leather (21.5 - US).
61 Panel Report, Australia – Salmon (21.5 – Canada).

under the SCM Agreement, and concerned the issue of whether or not certain later payments, to the
extent they were made under the same conditions and criteria as the original payments, fell within the
scope of Article 21.5 because they were subject to the obligation under Article 7.8 of the SCM
Agreement to withdraw the subsidy or remove its adverse effects. 62 The United States submits that,
contrary to Japan's assertion, 63 the Appellate Body did not consider the subsequent payments to be
"measures taken to comply" in the context of Ar ticle 21.5. The United States contends that the
Appellate Body's dicta in US – Upland Cotton (21.5 - Brazil) were limited to concerns over the
availability of relief against the adverse effects of actionable subsidies.64
7.41 The United States asserts that in US – Upland Cotton (21.5 - Brazil) , the Appellate Body also
corrected the misreading by Brazil and the compli ance panel of the Appellate Body report in US –
Softwood Lumber IV (21.5 - Canada) ,65 making clear that there is no general rule that any measure
that has a "particularly close relationship" to the declared measure to comply with the DSB's
recommendations and rulings would also be within the scope of a compliance proceeding. According
to the United States, this clarification counsels against the unwarranted expansion of Article 21.5
proceedings to cover subsequent administrative re views simply because of the similarities between
such reviews and those subject to the DSB's recommendations and rulings.
7.42 Regarding Japan's concerns about the possibility of Members never being able to obtain relief
against the United States' administrative reviews, 66 the United States asserts that Japan fails to grasp
that the jurisdiction of an Article 21.5 panel, and the scope of the dispute settlement system generally,
is limited by the text Members have agreed to. The United States contends that the DSU and the other
covered agreements cannot be re-w ritten to apply to additional measures just because that is what
Japan believes would be a better approach.
(c) Main arguments of the third parties
7.43 China argues that an implementing Member cannot decide for itself whether or not a measure
is "taken to comply". Reviews 4, 5 and 6 have sufficiently close links to the recommendations and
rulings of the DSB to fall within the scope of the proceeding.
7.44 The European Communities argues that Reviews 4, 5 and 6 fall under the terms of reference
of the panel. The European Communities notes th at a measure that essentially replaces an earlier
measure remains within the terms of reference of an original panel. Therefore, a compliance panel
must be in a position to assess whether an annual admi nistrative review determination that supersedes
the original determination relating to the same anti-dumping duty order, imposed on the same country
and the same product, following the same WTO-inc onsistent methodology, co nstitutes a "continuing
violation". The European Communities also re lies on the reasoning of the Appellate Body in US –
Upland Cotton (21.5 - Brazil) as support for the argument that the subsequent reviews should be
included within the scope of the proceeding, otherwi se Japan will not be able to obtain adequate relief
against the United States' violation, contrary to th e objective of "prompt co mpliance" under the DSU.
Further, the European Communities ar gues that even if the subsequent reviews are considered to be
separate measures to those at issu e in the original proceedings, th ey can be considered "measures
taken to comply" because they are clearly connected to the DSB's recommendations and rulings in the
original dispute and to the original measures. Finally, the fact that a measure may predate the

62 Appellate Body Report, US – Upland Cotton (21.5 - Brazil), paras. 248-49.
63 Japan, First Written Submission, paras. 81, 101.
64 Appellate Body Report, US – Upland Cotton (21.5 - Brazil), paras. 245-46.
65 Appellate Body Report, US – Upland Cotton (21.5 - Brazil) , para. 205. The United States asserts
that this correction was made in connection with the Appellate Body's findings on the US preliminary objection
concerning export credit guarantees.
66 Japan, First Written Submission, paras. 101-102.

adoption of the DSB recommendations and rulings does not per se exclude such measures from the
scope of compliance proceedings.
7.45 Hong Kong, China notes that if Reviews 4, 5 and 6 are not treated as "measures taken to
comply", it will be impossible for Members to obt ain an Article 21.5 remedy under a retrospective
anti-dumping duty assessment system, where there is a continuous process of administrative reviews
superseding one another. Hong K ong, China recalls that the aim of Article 21.5 of the DSU is to
promote prompt compliance with DSB recommend ations and rulings, without the necessity of
initiating new proceedings, and asks the panel consider this in reaching its conclusion.
7.46 Mexico argues that Reviews 4, 5 and 6 are within the scope of the proceeding and are
"measures taken to comply" because they are sufficiently closely linked to the measures at issue in the
original proceedings. Further, by asserting that th e subsequent administrative reviews "supersede" or
"withdraw" the original measures, the United States is effectively declaring that the reviews are
"measures taken to comply". Mexico asserts that the fact that Reviews 4 and 5 were implemented
prior to the adoption of the DSB recommendations a nd rulings does not prevent their characterisation
as "measures taken to comply". The subjective intent or purpose of the implementing Member cannot
determine whether measures are "taken to comply".
7.47 Norway argues that applying the same nexus-based test as adopted by the Appellate Body in
US – Softwood Lumber IV (21.5 – Canada) leads to the conclusion that Reviews 4, 5 and 6 are within
the panel's terms of reference as "measures taken to comply". The fact that two of the reviews pre-
dated the adoption of the DSB's recommendations and rulings does not alter this conclusion.
Although these two measures may not have been take n for the purpose of achieving compliance, the
panel's jurisdiction is not confined to measures that move in the direction of, or have the objective of
achieving, compliance. The important point is no t when a review is initiated, but whether it was
completed or continued to have le gal effects after the end of the RPT. Norway also notes that the
three reviews have the effect of undermining compliance with the recommendations and rulings of the
DSB and if they were not to fall within the scope of the proceeding they would turn the United States'
system of duty assessment into a moving target that always escapes anti-dumping duty disciplines.
Finally, if Japan were required to initiate new panel proceedings in order to challenge the three
subsequent administrative reviews, this would run counter to the objective of Article 21.5 of the DSU,
which is to promote prompt compliance with DSB recommendations and rulings.
7.48 Chinese Taipei submits that Reviews 4, 5 and 6 fall within the scope of the proceeding. The
fact that Reviews 4 and 5 were implemented prior to the adoptio n of the DSB recommendations and
rulings does not affect this conclusion because timi ng is only one factor for the panel to consider
when determining whether a measure is "taken to comply". Further, compliance panels are not
limited to measures that have the objective of achieving compliance.
7.49 Thailand argues that Reviews 4, 5 and 6 fall with in the scope of the proceeding. Thailand
contends that it is not up to the implementing Memb er to decide whether a measure is "taken to
comply". Thailand notes that the zeroing methodol ogy used as a component of all the measures
creates an undeniably strong link between the original measures and the subsequent reviews. Further,
if the subsequent reviews were excluded from the scope of the proceedings, a never-ending cycle of
litigation would ensue.
(d) Evaluation by the Panel
7.50 By virtue of the text of Article 21.5, proceed ings brought under that provision are limited to
instances in which there is disagreement as to the ex istence or consistency w ith a covered agreement
of "measures taken to comply" with the recommendati ons and rulings of the DSB. The United States
denies that Reviews 4, 5 or 6 are "measures taken to comply". Since Article 21.5 does not expressly

describe the type of measure that may, or may not, be considered as having been "taken to comply",
we turn to the relevant WTO dispute settlement reports for guidance.67
7.51 In Australia – Salmon (21.5 – Canada) , the panel had to decide whether it could examine (as
a "measure[] taken to comply") an import ban on salmon that had been adopted by the Australian state
of Tasmania shortly after the Australian federal gove rnment had notified a number of steps that it had
taken in order to remove the inconsistencies identifie d by the original panel regarding its treatment of
imported salmon. Australia argued that the panel could not examine the Tasmanian measure, and that
the only relevant measures were new federal im port requirements taken to comply with the
recommendations and rulings of the DSB. That panel observed that it could not merely allow an
implementing Member to identify the relevant measure to be assessed in Article 21.5 proceedings
because:
... an implementing Member could simply avoid any scrutiny of certain measures by a
compliance panel, even where such measures would be so clearly connected to the
panel and Appellate Body reports concerne d, both in time and in respect of the
subject-matter, that any impartial observer would consider them to be measures
"taken to comply".
68
7.52 Focusing on timing and subject-matter, the Australia – Salmon (21.5 – Canada) panel found
that:
any quarantine measure introduced by Aust ralia subsequent to the adoption on
6 November 1998 of DSB recommendations and rulings in the original dispute – and
within a more or less limited period of time thereafter – that applies to imports of
fresh chilled or frozen salmon from Canada, is a "measure taken to comply".
69
7.53 In Australia – Leather (21.5 - US) , the panel was concerned with Australia's implementation
of DSB's rulings and recommendations regarding the w ithdrawal of a prohibited export subsidy. In
September 1999, the subsidy recipient repaid the prospective element of the subsidy. Simultaneously,
the Government of Australia provided a new loan to the original subsidy recipient. In finding that
both the repayment of the original subsidy, and the new loan, fell within the scope of its DSU
Article 21.5 review, the panel stated:
The 1999 loan is inextricably linked to the steps taken by Australia in response to the
DSB's ruling in this dispute, in view of both its timing and its nature. In our view, the
1999 loan cannot be excluded from our c onsideration without severely limiting our
ability to judge, on the basis of the United States' request, whether Australia has taken
measures to comply with the DSB's ruling. In the absence of any compelling reason

67 We have not included US – Upland Cotton (21.5 – Brazil) in our review of relevant case law. In
that case, the Appellate Body addressed Article 21.5 in two separate sections of its Report. First, the Appellate
Body found that its reasoning in US – Softwood Lumber IV (21.5 – Canada) was not applicable in US – Upland
Cotton (21.5 – Brazil) (para. 205). In doing so, the Appellate Body explained that the relevant part of US –
Upland Cotton (21.5 – Brazil) concerned the issue of "whether a single programme may be permissibly
atomized" for the purpose of Article 21.5 . Since this issue does not arise in the present dispute, this part of the
Appellate Body's Report is not relevant to the issue under consideration. Second, the Appellate Body upheld the
panel's finding that certain measures fell within the scope of Article 21.5 (para. 249). In doing so, the Appellate
Body made frequent references to Article 7.8 of the SCM Agreement. Since that provision is not at issue in this
proceeding, we do not consider those other aspects of the Appellate Body's reasoning to be particularly relevant
guidance in this proceeding.
69 Ibid.

to do so, we decline to conclude that a me asure specifically identified in the request
for establishment is not within our terms of reference.
70
7.54 In US – Softwood Lumber IV (21.5 – Canada) , the United States declared that it had
implemented the DSB's recommendations and ruli ngs regarding a countervailing duty order by
revising that order through a Section 129 Determ ination. Ten days after the Section 129
Determination was concluded, the United States published the results of the First Assessment Review,
which was the first administrative review after im position of the order. The panel had to decide
whether or not the First Assessment Review could be treated as a "measure taken to comply" falling
within the scope of the panel's Article 21.5 jurisd iction, even though the United States denied that it
was a "measure taken to comply". The panel fou nd that the First Assessment Review should be
treated as a "measure taken to comply", because "it [was] clearly connected to the panel and Appellate
Body reports concerning the Final Determination, and because it [was] inextricably linked to the
treatment of pass-through [i.e., the substantive component found to be WT O-inconsistent in the
original proceeding] in the Section 129 Determination". 71 The panel concluded that there was
"sufficient overlap in the timing, or temporal effect, and nature of th e Final Determination,
Section 129 Determination and First Assessment Review for the latter to fall within the scope of the
present DSU Article 21.5 proceedings."72
7.55 The panel's findings were referred to the Appellate Body. The Appellate Body first examined
the text, context, object and purpose of Article 21.5 of the DSU. The Appellate Body stated that,
although [o]n its face [] the phrase "measures taken to comply" seems to refer to measures taken in the
direction of , or for the purpose of achieving , compliance", "[t]he fact that Article 21.5 mandates a
panel to assess 'existence' and 'consistency' tends to weigh against an interp retation of Article 21.5
that would confine the scope of a panel's jurisdiction to measures that move in the direction of , or
have the objective of achieving , compliance. These words also s uggest that an examination of the
effects of a measure may also be relevant to the de termination of whether it constitutes, or forms part
of, a 'measure[] taken to comply'."
73
7.56 The Appellate Body found that, "in order to fulfil its mandate under Article 21.5, a panel must
be able to take full account of the factual and legal background against whic h relevant measures are
taken, so as to determine the existence, or cons istency with the covered agreements, of measures
taken to comply,"74 and that "in order to fulfil its mandate unde r Article 21.5, a panel must be able to
assess measures taken to comply in their full cont ext, including how such measures are introduced
into, and how they function within, the particular system of the implementing Member."75
7.57 The Appellate Body also stated that "[a] furthe r feature of the first sentence of Article 21.5 is
the express link between the 'measures taken to comp ly' and the recommendations and rulings of the
DSB. Accordingly, determining the scope of 'meas ures taken to comply' in any given case must also
involve examination of the recommendations and ruli ngs contained in the original report(s) adopted
by the DSB. Because such recommendations and ru lings are directed at the measures found to be
inconsistent in the original proceedings, such an examination necessarily involves consideration of
those original measures." 76 In making this statement, the Appe llate Body noted that "the text of
Article 19.1 confirms the link between the measure ta ken to comply and the inconsistent measure that

70 Australia – Leather (21.5 - US), para. 6.5.
71 Panel Report, US – Softwood Lumber IV (21.5 - Canada ), para. 4.41.
72 Panel Report, US – Softwood Lumber IV (21.5 - Canada), para. 4.42.
73 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), paras. 66 and 67 (emphasis in
original).
74 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 69.
75 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 67.
76 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 68, footnote omitted.

was the subject of the original proceedings." 77 The Appellate Body stated that, although "there are
some limits on the claims that can be raised in Article 21.5 proceedings, [] these limits should not
allow circumvention by Members by allowing them to comply through one measure, while, at the
same time, negating compliance through another."
78
7.58 The Appellate Body then examined the relevant WTO dispute settlement reports. As we have
done, the Appellate Body recalled the findings of the panels in Australia – Salmon (21.5 – Canada)
and Australia – Leather II (21.5 - US) . Although the Appellate Body cautioned that "characterizing
an act by a Member as a measure taken to comply when that Member maintains otherwise is not
something that should be done lightly by a panel," the Appellate Body regarded those cases "as useful
illustrations of when such a finding is appropriate."
79 The Appellate Body also recalled that, in EC –
Bed Linen (21.5 – India), it upheld the panel's finding that certain parts of a measure may fall within the
scope of Article 21.5 proceedings when other, separate elements of the same measure do not, and
recognized that the ways in which distinct elements of a measure interact with and affect each other may
be relevant to the determination of which of them falls within the scope of Article 21.5 proceedings.80
7.59 The Appellate Body then provided the following summa ry of its analysis of the text, context,
object and purpose of Article 21.5 of the DSU, and relevant WTO dispute settlement reports:
Taking account of all of the above, our in terpretation of Article 21.5 of the DSU
confirms that a panel's mandate under Ar ticle 21.5 of the DSU is not necessarily
limited to an examination of an implem enting Member's measure declared to be
"taken to comply". Such a declaration will always be relevant, but there are
additional criteria, identified above, that s hould be applied by a panel to determine
whether or not it may also examine other measures. Some measures with a
particularly close relationship to the declar ed "measure taken to comply", and to the
recommendations and rulings of the DSB, may also be susceptible to review by a
panel acting under Article 21.5. Determining whether this is the case requires a panel
to scrutinize these relationships, which may, depending on the particular facts, call for
an examination of the timing, nature, and effects of the various measures. This also
requires an Article 21.5 panel to examine the factual and legal background against
which a declared "measure taken to comply" is adopted. Only then is a panel in a
position to take a view as to whether ther e are sufficiently close links for it to
characterize such an other measure as one "taken to comply" and, consequently, to
assess its consistency with the covered agreements in an Article 21.5 proceeding.
81
7.60 Most recently, in EC – Bananas III (21.5 – US) , the Appellate Body used a two-step process
in determining whether or not a measure is "taken to comply":
The Appellate Body has emphasized that the reasoning in US – Softwood Lumber IV
(21.5 – Canada) concerned the identification of cl osely connected measures so as to
avoid circumvention. Therefore, if the measure at issue is found to constitute in itself
a measure taken to comply, it will not be necessary to establish a "particularly close
relationship" of the measure at issue to the declared measure taken to comply in order
to subject the measure at issue to the scope of Article 21.5. Our analysis must thus
begin with the question whether the measur e at issue in this case was in itself a

77 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), footnote 108.
78 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 71.
79 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 74.
80 Appellate Body Report, EC – Bed Linen (21.5 – India) . Appellate Body Report, US – Softwood
Lumber IV (21.5 - Canada ), para. 76.
81 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada ), para. 77.

measure taken to comply. In the event that the measure at issue is found not to be in
itself a measure taken to comply, our anal ysis will turn to the question whether a
"particularly close relationship" exists betw een the measure at issue and the declared
measure taken to comply, which would warrant subjecting the measure at issue to the
scope of Article 21.5 of the DSU.
82
7.61 In EC – Bananas III (21.5 – US), therefore, the Appellate Body described a two-step approach.
First, a determination is made whether the relevant m easure is "in itself" "taken to comply". If it is
not, a determination is made whether the relevant measure might nevertheless constitute a "measure
taken to comply" by virtue of its "particularly cl ose relationship" to a "declared" "measure taken to
comply". Since the United States has not forma lly "declared" any "measure[] taken to comply", 83 we
would not be able to apply the second step envisaged by the Appellate Body. 84 The absence of any
"declared" "measure[] taken to comply" in the prese nt case also renders the fact-specific reasoning in
US – Softwood Lumber IV (21.5 – Canada) inapplicable.
7.62 Nevertheless, this does not mean that we ma y not be guided by the observations that the
Appellate Body made in US – Softwood Lumber IV (21.5 – Canada) regarding the interpretation of
the phrase "measures taken to comply". In this regard, we recall the Appellate Body's reference 85 to
the express link between the phrase "measures taken to comply" and the recommendations and rulings
of the DSB. Since Article 21.5 covers measures that are taken to comply with those recommendations
and rulings, a "measure[] taken to comply" must be sufficiently closely connected to the original
dispute that gave rise to those recommendations a nd rulings. We shall therefore consider whether
Reviews 4, 5 and 6 are sufficiently closely connected
86 to the original dispute, such that they should
be treated as "measures taken to comply" with the recommendations and rulings made pursuant to that
dispute. In doing so, we shall examine the timing, nature and effects of the Reviews, including how
they were introduced, and how they function, in the United States' anti-dumping system.87
7.63 In order to address the issue in its proper cont ext, we begin by taking into account the factual
and legal background against which Reviews 4, 5 and 6 were taken. In describing its retrospective
anti-dumping duty assessment system in the original proceeding, the United States explained that:
If the U.S. Department of Commerce (" Commerce") finds that dumping existed
during the period of investigation, and if the U.S. International Trade Commission
("ITC") determines that a U.S. industry was injured by reason of dumped imports, the

82 Appellate Body Report, EC – Bananas III (21.5 – US), para. 245 (footnote omitted).
83 In its Reply to Question 3 from the Panel (para. 10), the United States asserts that "[t]he measure
bringing the United States into comp liance in each instance was the act of removing the WTO-inconsistent
border measure, and it is this act which can be consid ered the measure taken to comply". In doing so, the
United States fails to identify the particular meas ure by which such withdrawal was accomplished.
Accordingly, we are unable to identify any measure that the United States could be said to have "declared" to be
a "measure[] taken to comply".
84 As explained below, we examine whether Review s 4, 5 and 6 are so cl early connected to the
measures at issue in the original proceeding (i.e., Reviews 1, 2 and 3), and the subject-matter of that dispute, that
they should be treated as "measures taken to comply" with the recommendations and rulings regarding those
original measures. In our view, such an approach is not inconsistent with examining whether those measures are
"in themselves" "measures taken to comply". We do not use the phrase "in themselves", though, since that
phrase is not contained in Article 21.5.
85 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada ), para. 68.
86 In our view, this is the essence of the approach adopted by the panel in Australia – Salmon (21.5 –
Canada), which considered whether the relevant measures are " so clearly connected to the panel and Appellate
Body reports concerned ... that any impartial observer would consider them to be measures 'taken to comply'."
87 Issues regarding the timing of the relevant measures are addressed separately at paras 7.76- 7.80
infra.

investigation phase ends and the second ph ase of the antidumping proceeding – the
assessment phase – begins. In the assessmen t phase, the focus is on the calculation
and assessment of antidumping duties on specific entries by individual importers.88
7.64 The United States further explained that, under its assessment system:
an antidumping duty liability attaches at the time of entry, but duties are not actually
assessed at that time. Rather, the United Stat es collects security in the form of a cash
deposit at the time of entry, and determines the amount of duties due on the entry at a
later date. Specifically, once a year (duri ng the anniversary month of the orders)
interested parties may request a review to determine the amount of duties owed on
each entry made during the previous year. Antidumping duties are calculated on a
transaction-specific basis and are assessed on an importer-specific basis, in much the
same way as duties are assessed in prospective assessment systems. If no review is
requested, the cash deposits made on the entries during the previous year are
automatically assessed as the final duties.
89
7.65 Like Reviews 1, 2 and 3, which were measures found to be WTO- inconsistent in the original
proceeding, Reviews 4, 5 and 6 are administrative reviews of the 1989 Anti-Dumping Order. The
nature and effect of Reviews 4, 5 and 6 is identical to that of Reviews 1, 2 and 3. In other words, like
Reviews 1, 2 and 3, each of Reviews 4, 5 and 6 relates to the "assessment phase", and each determines
the amount of anti-dumping duties owed on entries made during the previous year. Reviews 4, 5
and 6 are consecutive administrative reviews. Revi ew 4, the earliest of those measures, followed
immediately after Review 3, the latest administrativ e review in the original proceeding. Although the
parties treat each administrative review as an independent legal measure, the underlying legal
authority for each measure resides in the same 1989 Anti-Dumping Order. Reviews 1, 2, 3, 4, 5 and 6
(together with two additional administrative revi ews found to be inconsistent in the original
proceedings but not at issue in these proceedings) th erefore form part of a continuum, the purpose of
which is the ongoing assessment of anti-dumping duties owed under the 1989 Anti-Dumping Order.
90
7.66 USDOC makes two different determinations in an administrative review. First, USDOC
determines exporter-specific cash deposit rates that will apply prospectively to future import entries.
Second, USDOC determines importer-specific assessme nt rates for previous entries imported during
the review period. Thus, import entries subject to exporter-specific cash deposit rates determined in
one administrative review become subject to im porter-specific assessment rates in the following
administrative review. The United States has explaine d in this regard that the cash deposits serve as a
"place-holder" for the liability to be determin ed in the subsequent administrative review. 91 We recall
that Reviews 1, 2, 3, 4, 5 and 6, together w ith two additional administrative reviews found to be
inconsistent in the original proceedings but not at issue in these proceedings, 92 are consecutive
measures. The fact that each preceding administra tive review serves as a "place-holder" (in the form
of exporter-specific cash deposit rates) for the liability to be determined in the consecutive

88 United States, First Written Submission in the original proceeding, para. 7
(http://www.ustr.gov/assets/Trade_Agreements/Monitoring_Enforcement/Dispute_Settlement/WTO/Dispute_Se
ttlement_Listings/asset_upload_file372_7838.pdf).
89 Ibid, para. 13, footnotes omitted.
90 We recall that the latest administrative review in that continuum is Review 9, discussed below at
para. 7.114.
91 United States, First Written Submission, para. 61.
92 In the original proceedings, the 1998/1999 and 2001/2002 ball be aring administrative reviews,
identified in the annex to Japan’s original panel reques t as specific cases nos. 5 and 12 (WT/DS322/8), were
found to be inconsistent with Article 9.3 of the AD Agreement and Article VI:2 of the GATT 1994. Japan
explains that it has not pursued claims in these comp liance proceedings regarding these measures because the
United States had already liquidated all entries covered by the reviews by the end of the RPT.

administrative review (through importer-specific assessment rates) demonstrates substantive
continuity between the original and subsequent reviews.
7.67 Further substantive continuity between these c onsecutive administrative reviews results from
the fact that the cash deposit rates applied by on e administrative review are replaced or superseded
93
by the cash deposit rates applied by the subsequent administrative review. Regarding the interaction
between Reviews 1, 2 and 3, on the one hand, and Re views 4, 5 and 6, on the other, the United States
asserts that "[t]he original reviews were supersed ed by subsequent reviews because the cash deposit
rate from one review was replaced by the cash deposit rate from the next review". Through the
substantive continuity outlined above, Reviews 4, 5 and 6 are closely connected to the original
dispute.
7.68 We recall that the recommendations and rulings in the original dispute concerned the WTO-
inconsistent application of zeroing in the cont ext of Reviews 1, 2 and 3. We find below 94 that
USDOC continued to apply zeroing in Reviews 4, 5 a nd 6. In our view, the continued application in
subsequent administrative reviews of a methodol ogy found WTO-inconsistent in the original
proceeding is a legally relevant element connecting Reviews 4, 5 and 6 to the original dispute, and the
recommendations and rulings resulting therefrom.95
7.69 Furthermore, we note the United States' argu ment that it came into compliance with the
DSB's recommendations and rulings by withdrawing the WTO-inconsistent cash deposit rates. In this
regard, the United States asserted:
The United States came into complian ce with the DSB's recommendations and
rulings when the WTO-inconsistent cash deposit rates were removed through
incidental effects of the operation of the U.S. antidumping system. The measure
bringing the United States into compliance in each instance was the act of removing
the WTO-inconsistent border measure, and it is this act which can be considered the
measure taken to comply, or in the words of the Panel, "the measure that removed the
specific cash deposit rates at issue in the original proceeding." The United States did
not, however, adopt a separate measure (such as the results of another administrative
review) that removed those specific cash deposit rates; rather, the removal of those
cash deposit rates occurred by operation of U.S. law following those subsequent
administrative reviews.
96
7.70 We understand from this response that the Unite d States accepts that the removal of the
WTO-inconsistent cash deposit rates constitutes a "m easure[] taken to comply", but nevertheless
maintains that such removal is separate from Reviews 4, 5 and 6.97

93 We note that, in US – Softwood Lumber IV (21.5 - Canada) , para. 85, the Appellate Body relied on
the fact that the First Assessment Review "superseded " the cash deposit rate resulting from the Section 129
Determination to support its conclusion that the First Assessment Review was a "measure[] taken to comply".
94 See paras. 7.160-7.166.
95 Japan's claims in the present case are exclusivel y concerned with the continuation of zeroing in
subsequent administrative reviews. We are not faced with a situation where Japan raises claims in respect of a
subsequent administrative review that it could also have raised in the original proc eeding, but elected not to do
so. Our findings therefore have no bearing on whether such claims might properly fall within the jurisdiction of
an Article 21.5 panel.
96 United States, Reply to Question 3 from the Panel, para. 10, emphasis supplied.
97 This is confirmed by the United States' Reply to Question 2 from the Panel, where the United States
asserted that "[t]he WTO-inconsistent cash deposit rate s for Review Nos. 1, 2 and 3 were removed by the time
that the cash deposit rate for Review No. 4 was put in place."

7.71 In its First Written Submission, the United St ates asserted that Reviews 1, 2 and 3 "were
superceded by subsequent reviews because the cash de posit rate from one review was replaced by the
cash deposit rate from the next review". 98 This is what the United States meant when it explained
"that the measures subject to the DSB's recommendations and rulings were eliminated as an incidental
consequence of a subseque nt administrative review". 99 However, since it is the subsequent
administrative review that eliminates the cash depos it rates imposed by a prior review (and replaces
them with updated cash deposit rates), the elimin ation of existing cash deposit rates may not be
viewed separately from the superseding administrative review.
7.72 This is confirmed by the United States' desc ription of the operation of its retrospective
assessment system. In particular, the United States has asserted that "[t]he results of [an
administrative] review serve as the basis for the calculation of the assessment rate for each importer of
the subject merchandise covered by the review. Th e results also establish new cash deposit rates for
the collection of estimated antidumping duties on imports going forward, replacing any cash deposit
rate already in effect for the exporters or producers reviewed."100
7.73 We do not consider that the act of removing the WTO-inconsistent cash deposit rates may be
viewed as having occurred independently of the subsequent administrative review. Nor do we
consider that such act of removal might prop erly be distinguished from the contemporaneous
replacement of those cash deposit rates with new cash deposit rates established in that subsequent
administrative review. For these reasons, we are una ble to accept that it is exclusively the act of
removing the WTO-inconsistent cash deposit rates that constitutes the "measure[] taken to comply".
Instead, it is the subsequent administrative revi ew, and the process of withdrawing and replacing cash
deposit rates inherent therein, that constitutes the "measure[] taken to comply".
7.74 The first subsequent administrative review after Review 3 was Review 4. Review 4,
therefore, withdrew and replaced the WTO-inconsis tent cash deposit rates resulting from Review 3.
Indeed, had Review 4 not occurred, the cash depo sit rates found to be WTO-inconsistent in the
original proceeding would have remained in place. Consistent with the above analysis, we find that
Review 4 is sufficiently closely connected to the orig inal dispute, such that it should be treated as a
"measure[] taken to comply" with the recommendations and rulings resulting from that dispute. This
finding is confirmed by the fact that importer-spe cific assessment rates determined in Review 4
continued to have effects after both the adoption of the DSB's recommendati ons and rulings, and the
expiry of the RPT.101
7.75 Furthermore, we recall that Review 4 was superseded by Review 5 and Review 5 was
superseded by Review 6, which itself was superseded most recently by Review 9. In other words,
Review 3 was actually superseded, in turn, by Reviews 4, 5 and 6 (and, most recently, 9). Thus, to
say that only Review 4 constitutes a "measure[] take n to comply" does not capture the reality of the
United States' assessment system, for it overlooks the continuation of the assessment chain, and the
continuation of zeroing, beyond Review 4. In our view, the subsequent links of that chain are
therefore sufficiently closely connected to the original dispute, such that they should also be treated as
"measures taken to comply" with the recommendations and rulings resulting from that dispute. As

98 United States, First Written Submission, para. 44.
99 United States, First Written Submission, para. 44.
100 United States, First Written Submission, para. 9 (emphasis supplied).
101 Japan has demonstrated that some of the import entries covered by the Review 4 importer-specific
assessment rates had not been liquidated by the commencement of this proceeding (Japan's Reply to
Question 10, and its Comments on the United States' Rep lies, para. 55). Although the United States disputes
Japan's claim that no entries covered by those measures had been liquidated by the end of the RPT, the
United States does not exclude that some entries had not been liquidated by that date. The United States merely
asserts that it is possible that some entries were liquidated prior to the end of the RPT. (United States' Comments

with Review 4, this finding is confirmed by the fact that importer-specific assessment rates
determined in Reviews 5 and 6 continued to have effects after both the adoption of the DSB's
recommendations and rulings, and the expiry of the RPT.
102
7.76 The United States would have the Panel find that the substantive links between Reviews 4, 5
and 6 and the original dispute are broken by considera tions of timing. In particular, the United States
contends that Reviews 4 and 5 have "no connec tion with the DSB's recommendations and rulings", 103
since they were made well before the adoptio n of the DSB's recommendations and rulings, and
therefore "could not logically ha ve taken into consideration" 104 those recommendations and rulings.
According to the United States, "measures taken by a Member prior to adoption of a dispute
settlement report typically are not taken for the purpose of achieving compliance and would not be
within the scope of an Article 21.5 proceeding."105
7.77 The United States asserts that, in making its finding in US – Softwood Lumber IV (21.5 -
Canada), the Appellate Body considered the timing betw een the two determinations at issue, in the
sense that the determinations in the Section 129 pr oceeding – the declared measure taken to comply –
and the First Assessment Review both occurred af ter the adoption of the DSB's recommendations and
rulings, and both closely corresponde d to the expiration of the RPT. 106 The United States asserts that
the timing of these two determinations thus provide d USDOC with the ability to take account of the
DSB's recommendations and rulings in the first ad ministrative review, and as the Appellate Body
emphasized, the United States expressly acknowledg ed that USDOC used the same pass-through
analysis in the first administrative review as in the Section 129 Determination "in view of" the DSB's
recommendations and rulings.107 The United States acknowledges that USDOC issued its final results
in Review 6 after the adoption of the DSB's r ecommendations and rulings, but asserts that this
determination (dated 12 October 2007) did not occu r around the same time as US withdrawal of the
administrative reviews subject to the DSB's recommendations and rulings, 108 and did not closely
correspond to the expiration of the RPT (on 24 December 2007). The United States further asserts
that, most importantly, unlike the first assessment review in US – Softwood Lumber IV (21.5 -
Canada), Review 6 did not incorporate elements from a Section 129 Determination "in view of" the
DSB's recommendations and rulings.
7.78 We recall that we have not sought to apply the fact-specific reasoning of either the panel or
Appellate Body in US – Softwood Lumber IV (21.5 – Canada) . Furthermore, we note that the

102 Japan has demonstrated that some of the import entries covered by the Review 5 and 6 importer-
specific assessment rates had not been liquidated by the commencement of this proceeding (Japan, Reply to
Question 10, and its Comments on the United States' Replies, para. 55). Although the United States disputes
Japan's claim that no entries covered by those measures had been liquidated by the end of the RPT, the
United States does not exclude that some entries had not been liquidated by that date. The United States merely
asserts that "it is possible that some entries were liq uidated prior to the effectiv e dates of the preliminary
injunction." (United States, Comments on Japan's Replies, para. 9).
103 United States, First Written Submission, para. 34.
104 United States, First Written Submission, para. 39.
105 United States, First Written Submission, para. 33. In its Replies to Questions from the Panel
(para. 15), the United States emphasises that it only clai med in its First Written Submission that measures taken
prior to adoption of a report are not "typically" taken for the purpose of achieving compliance. The
United States asserts that it "has not expressed th e view that measures adopted prior to the DSB's
recommendations and rulings can never be within the scope of a compliance proceeding". We consider that this
nuance in the United States' position is not inconsistent with the approach that we have taken in this proceeding.
106 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 84.
107 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada) , para. 84 (citing US additional
memorandum, para. 12).
108 The United States asserts that the cash deposit rate for the most recent review that was subject to the
DSB's recommendations and rulings, namely Review 3, was replaced by the cash deposit from Review 4
in 2005, around two years before the results of Review 6 were announced.

Appellate Body in US – Softwood Lumber IV (21.5 – Canada) examined timing as one element of its
scrutiny of the relationship between the Section 129 Determination and the First Assessment Review.
Having examined the connections between those me asures based on their nature and effects, the
Appellate Body treated the fact that the publication and effective dates of both the Section 129
Determination and the First Assessment Review "coincided in time" as "an additional link".
109 We do
not understand the Appellate Body to have concluded that timing was determinative. Nor do we
understand the Appellate Body to ha ve concluded that measures taken by a Member prior to adoption
of a dispute settlement report might neve r constitute "measures taken to comply". 110 Indeed, the
Appellate Body merely referred to the fact th at the First Assessment Review was published ten
months after adoption of the DSB's recommendations a nd rulings in order to reject the United States'
argument that the First Assessment Review was not a "measure taken to comply" because it was
initiated before the adoption of the DSB's recommendations and rulings.111
7.79 In our view, the fact that Reviews 4 and 5 pre-dated adoption of the DSB's recommendations
and rulings is not sufficient to break the very stro ng substantive links between those measures and the
original dispute. We recall that this proceedi ng concerns a series of subsequent administrative
reviews that extends, through the continued ap plication of zeroing, the chain of assessment
commenced by the administrative revi ews at issue in the original pro ceeding. We further recall that
Reviews 4, 5 and 6 continue the chain of assessme nt through, and beyond, the "reasonable period of
time" allowed to the United States for implementing the recommendations and rulings of the DSB. In
addition, importer-specific assessment rates determined in Reviews 4, 5 and 6 continued to have legal
effect long after the adoption of the DSB's recommendations and rulings. 112 Furthermore, regarding
Review 4 in particular, we recall our rejection of the United States' argument that the removal of the
WTO-inconsistent cash deposit rates, as distinct from the contemporaneous replacement of those cash
deposit rates with new cash deposit rates, can be c onsidered to be a "measure[] taken to comply". 113
We repeat that it is the subsequent administrativ e review as a whole, and the process of withdrawing
and replacing cash deposit rates inhe rent therein, that constitutes the "measure[] taken to comply".
Since it was Review 4 that withdrew and replaced the WTO-inconsistent cash deposit rates resulting
from Reviews 1, 2 and 3, it is simply not credible for the United States to assert that Review 4 has "no
connection with the DSB's recommendations and rulings" merely because Review 4 pre-dated them.
7.80 In addition, we are concerned that the Unite d States' argument regarding timing seems to
suggest that Article 21.5 should be applied in light of the intent of the implementing Member. This
concern arises from the United States' argument that "[m]easures taken by a Member prior to adoption
of a dispute settlement report typically are not taken for the purpose of achieving compliance". 114 A

109 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 84.
110 We see no reason why a Member should not be able to demonstrate compliance on the basis of
"measures taken to comply" that may have been adopted before the adoption of the DSB's recommendations and
rulings. Indeed, we note that the United States itself appears to have adopted a similar position in US –
Gambling Services (21.5 – Antigua and Barbuda) at para. 5.11, where "[t]he United States requested a footnote
to one sentence in paragraph 6.22, cl arifying that compliance need not necessarily occur subsequent to the DSB
recommendation and rulings, as a WTO Member might modify or remove measures at issue after establishment
of a panel but prior to adoption of the panel or Appellate Body report".
111 That being said, we acknowledge that the panel in Australia – Salmon (21.5 – Canada) limited its
jurisdiction to "any quarantine measure introduced by Australia subsequent to the adoption on 6 November 1998
of DSB recommendations and rulings in the original di spute". That panel was concerned primarily with
examining the connections between the re levant measures and the original dispute. That that panel established
such connections by reference to timing and subject-matter does not exclude that another panel, confronted with
different facts, might establish such connections differently, or with different degrees of emphasis on the
relevant factors.
112 See paras. 7.74 and 7.75.
113 See paras. 7.69, 7.72, 7.73 and 7.74.
114 United States, First Written Submission, para. 33 (emphasis supplied).

similar concern arises in respect of the United States' argument that Review 6 was not adopted "in
view of" the recommendations and rulings of the DS B, and that "none of these administrative reviews
was a voluntary action taken by the United States around the time of implementation to circumvent or
undermine declared compliance with th e DSB's recommendations and rulings".
115 We have already
noted that the Appellate Body stated in US – Softwood Lumber IV (21.5 - Canada) that "[t]he fact that
Article 21.5 mandates a panel to assess 'existence' and 'consistency' tends to weigh against an
interpretation of Article 21.5 that would confine the scope of a panel's jurisdiction to measures that
move in the direction of , or have the objective of achieving , compliance".116 Referring to this ruling
by the Appellate Body, the panel in US – Gambling Services (21.5 – Antigua and Barbuda) declined
to "exclude any potential 'measures taken to comply' due to the purpose for which they may have been
taken".117 We agree that Article 21.5 should not be inte rpreted and applied on the basis of the intent
of the implementing Member. For this reason, we should not exclude any particular subsequent
administrative review as a "measure[] taken to comply" simply because the United States may not
have adopted that measure for the purpose, or in view, of implementing the recommendations and
rulings of the DSB.118
7.81 Similar considerations lead us to reject the United States' argument that Reviews 4, 5 and 6
should be excluded from the scope of this proceed ing because they only accomplished compliance as
an "incidental consequence" of the operation of the United States' anti-dumping duty assessment
system. Again, the obvious implication behind th is argument is that those measures fall outside the
scope of Article 21.5 because they were not adopted for the purpose of complying with the
recommendations and rulings of the DSB. As indi cated above, we decline to apply Article 21.5 on
the basis of the intent of the United States in adopting Reviews 4, 5 and 6. In our view, this is entirely
consistent with the Appellate Body's treatment of a similar argument by the United States in US –
Softwood Lumber (21.5 – Canada)):
[w]e recognize that the First Assessment Re view was not initiated in order to comply
with the recommendations and rulings of th e DSB, and that it operated under its own
timelines and procedures, which were indepe ndent of the Section 129 Determination.
Nevertheless, these considerations are not sufficient to overco me the multiple and
specific links between the Final Countervaili ng Duty Determination, the Section 129
Determination, and the pass-through analysis in the First Assessment Review.
119
7.82 For the above reasons, we find that Reviews 4, 5, and 6 are sufficiently closely connected to
the original dispute, such that they should be treated as "measures taken to comply" with the
recommendations and rulings of the DSB.
7.83 Before proceeding to the next preliminary issu e, we note the United States' reliance on the
Appellate Body's statement in US – Softwood Lumber IV (21.5 - Canada) that "not . . . every
assessment review will necessarily fall within the jurisdiction of an Article 21.5 panel." 120 T h e
present case, however, does not concern the issue of whether or not "every assessment review" might
fall within the scope of Article 21.5 of the DSU. Rather, it concerns the application of that provision
only in respect of the particular subsequent admini strative reviews challenged by Japan. In light of

115 United States, First Written Submission, para. 43.
116 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada) para. 67 (emphasis in original).
117 Panel Report, US – Gambling Services (21.5 – Antigua and Barbuda), para. 6.24 (emphasis in
original).
118 Whether or not measures were adopted "in view of" DSB recommendations and rulings should not
be determinative because Members could very easily exclude measures from the scope of Article 21.5 simply by
omitting to state that they were adopted in view of DSB recommendations and rulings, or by expressly stating
that they are not taken "in view of" any DSB recommendations and rulings.
119 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 88.
120 Appellate Body Report, US – Softwood Lumber IV (21.5 - Canada), para. 93 (footnote omitted).

the specific connections outlined above, including the continued application in Reviews 4, 5 and 6 of
a methodology found WTO-inconsistent in the original proceeding, we find that Reviews 4, 5 and 6
are "measures taken to comply". This does not necessarily mean that all subsequent administrative
reviews will necessarily fall within the scope of subsequent Article 21.5 proceedings.
2. The inclusion of Review 9 in these proceedings
(a) Main arguments of the parties
7.84 The United States seeks a preliminary ruling that th e phrase "subsequent closely connected
measures" in Japan's panel request fails specifically to identify the alleged subsequent measures, as
required under Article 6.2 of the DSU. In respons e to Japan's submission that Review 9 should be
included within the scope of the proceeding, the Un ited States argues that it was not identified with
sufficient specificity in Japan's panel request. Fi nally, the United States argues that, in any event, a
future measure, not in existence at the time of th e request for establishment of a panel, cannot be
within a panel's terms of reference.
7.85 Article 6.2 of the DSU provides:
The request for the establishment of a panel shall be made in writing. It shall indicate
whether consultations were held, identify the specific measures at issue and provide a
brief summary of the legal basis of the complaint sufficient to present the problem
clearly. In case the applicant requests the establishment of a panel with other than
standard terms of reference, the written request shall include the proposed text of the
special terms of reference [emphasis added].
7.86 Japan's request for the establishment of a panel provides, relevantly:
This request concerns five of the 11 peri odic reviews…plus three closely connected
periodic reviews that the United States argues "superseded" the original
reviews…These eight periodic reviews…stem from anti-dumping duty orders on
"Ball Bearings and Parts Thereof From Japan", "Cylindrical Roller Bearings and
Parts Thereof From Japan", and "Spherical Plain Bearings and Parts Thereof From
Japan"…Further, the request concerns any amendments to the eight periodic
reviews…as well as any subsequent closely connected measures [emphasis added].
 121
7.87 According to the United States, future administrative reviews, including the subject of Japan's
supplemental submission, Review 9, fall outside th e scope of the proceeding. The United States
asserts that Article 6.2 of the DSU requires that a panel request "identify the specific measures at
issue" and under Article 7.1 of the DSU, the panel' s terms of reference are limited to those specific
measures. The United States contends that each de termination that sets a margin of dumping for a
defined period of time is separate and distinct and that Japan is required to identify each such measure
in its panel request. If Japan were allowed to challenge subsequent administrative reviews, the
United States would be forced to defend an ever-expanding target during the course of the
proceedings.
7.88 The United States contends that whether or not it received "notice" of Japan's intention to
challenge future reviews is beside the point. Ne ither Article 6.2 nor any other provision in a covered
agreement requires a respondent to demonstrate that it failed to receive adequate notice regarding
certain measures not identified in a panel request. Article 6.2 clearly requires that the specific
measures be identified if they are to fall within th e panel's terms of refere nce. The United States

121 WT/DS322/27, para. 12.

concludes that Japan could not have identified a meas ure not in existence at the time of its request for
the establishment of a panel. This is all the United St ates is required to show in order to prevail in its
request for a preliminary ruling.
7.89 The United States argues that any reliance by Japan upon Australia – Salmon (21.5 -
Canada), EC – Bananas III (21.5 - US) or US – Zeroing II (EC)
122 is inapposite. According to the
United States, there is a key difference between Australia – Salmon (21.5 - Canada) and the present
case. The United States argues that, unlike the situation in Australia – Salmon (21.5 - Canada), Japan
is not challenging future measures that are related to a regulatory standard that was adopted to comply
with the recommendations and rulings of the DSB. Rather, Japan is challenging a subsequent
administrative review that occurred upon the request of interested parties on a schedule established
without regard to the dispute settlement proceedings. The United States concludes that Review 9, and
any other subsequent reviews, are independent of the dispute and of other prior reviews. Japan's
challenge is not analogous to challenging subsequent measures which implement or are closely related
to a framework law or regulation.
7.90 According to the United States, EC – Bananas III (21.5 - US) is irrelevant because the
question before the panel in that case did not relate to a failure to specify a measure under Article 6.2
of the DSU, but concerned whether an unreasonable amount of time had elapsed between the adoption
of the DSB's recommendations and rulings and the Un ited States' challenge. In relation to Japan's
reliance upon US – Zeroing II (EC), the United States notes that this ruling has not been adopted and
may be appealed. In any event, the panel found that, in principle, except in exceptional
circumstances, Article 6.2 does not allow a panel to make findings regarding measures that do not
exist at the date of the panel's establishment.
7.91 The United States also argues that the future ad ministrative reviews fall outside the scope of
the proceeding because, under the DSU, measures not in existence at the time of panel establishment
cannot be subject to dispute settlement. Th e United States relies on the panel report in US – Upland
Cotton123 to support this proposition.
7.92 Japan submits that the Panel should reject the Un ited States' request for a preliminary ruling
that the phrase "subsequent closely connected measur es" does not meet the specificity requirement in
Article 6.2 of the DSU. Further, Japan submits that Review 9 is within the scope of the proceeding.
7.93 Japan argues that the terms of its panel request were sufficiently specific. The United States
understood the phrase "subsequent closely connected me asures" to identify future periodic reviews,
because the United States submitted that:
Japan is trying to include in the Panel's terms of reference any future administrative
reviews related to the eight identified in its panel request. 124
7.94 For Japan, this confirms that the terms of its pa nel request were sufficiently specific and that
the United States was put on "notice" regarding Japan's claims in respect of subsequent administrative
reviews. Further, the interpretation Japan advocat es promotes the prompt settlement of disputes in
accordance with Articles 3.3 and 21.1 of the DSU. If Japan were required to initiate a second set of
compliance proceedings in relation to subsequent admi nistrative reviews, in particular Review 9, this
would needlessly delay the settlement of the dispute.

122 Panel Report, US – Zeroing II (EC) . During the course of these proceedings, the Panel Report was
appealed by both parties. The Appellate Body issued its report on 4 February 2009. The Panel Report, as
modified by the Appellate Body Report, was adopted by the DSB on 19 February 2009.
123 Panel Report, US – Upland Cotton.
124 United States, First Written Submission, para. 50.

7.95 Japan rejects the United States' argument that fu ture measures can never be part of a panel's
terms of reference. In this regard, Japan relies on the panel report in US – Zeroing II (EC), in which
the panel recognized that, in appropriate circumstan ces, future measures identified in a panel request
can be within a panel's terms of reference. Japan alleges that Review 9 satisfies such circumstances.
7.96 Japan also relies upon Australia – Salmon (21.5 - Canada) to support its argument that
Review 9 was identified with sufficient specificity in its request for the establishment of a panel.
Japan notes that in Australia – Salmon (21.5 - Canada) , a Tasmanian import ban, adopted after the
parties had filed their first written submissions, was included in the panel's te rms of reference. The
panel in that case noted that measures taken subse quent to the establishment of a panel should not per
force be excluded from the panel's mandate. In th e context of compliance proceedings, there may be
compelling reasons to examine measures introduced during proceedings because compliance is often
an ongoing and continuous process. Japan rej ects the United States' interpretation of Australia –
Salmon (21.5 - Canada). In particular, Japan does not accept th at the Tasmanian ban was within the
panel's terms of reference because it "implemented " or was "similar" to a declared compliance
measure, namely the removal of the federal ban. Rather, it was within the panel's jurisdiction because
it belonged to a category of measures identified in the panel request and because the particular
characteristics of compliance proceedings compelle d its inclusion. Even if the United States'
interpretation were correct, Review 9 is similar and closely related to other measures identified in the
panel request.
7.97 Japan also relies upon EC – Bananas III (21.5 - US) to support the notion that a measure
adopted many years after the end of the reasonabl e period of time can be a "measure[] taken to
comply".
(b) Main arguments of the third parties
7.98 The European Communities argues that the United States' request for a preliminary ruling
under Article 6.2 of the DSU should be declined . The European Communities contends that
Article 6.2 requires the Member concerned to identi fy the specific measures at issue so that the
responding party knows the case it has to answer. According to the Europ ean Communities, Japan's
panel request contains a clear indication of the measures at issue and as a result, the United States was
aware of the specific measures which fell under the scope of the proceeding. The fact that certain of
the measures identified in the panel request were fu ture measures is not related to the specificity
requirement under Article 6.2 of the DSU, which does not have a temporal scope.
7.99 Chinese Taipei submits that the phrase "subsequent closely connected measures" was
specific enough to identify Review 9. Further, the panel in US – Zeroing II (EC) recognized that, in
appropriate circumstances, future measures identifie d in a panel request can be included in a panel's
terms of reference.
(c) Evaluation by the Panel
7.100 The panel understands the parties to raise th ree issues associated with the inclusion of
Review 9 within the scope of the proceedings. In particular, the United States seeks a preliminary
ruling that the phrase "subsequent closely conne cted measures" does not identify the specific
measures at issue, as required by Article 6.2 of the DSU. Second, Japan seeks the inclusion of
Review 9 within the panel's jurisdiction. B ased on its request for a preliminary ruling, the
United States argues the phrase "subsequent closely connected measures" cannot support its inclusion.
Finally, the United States argues that any future measures, including Review 9, cannot be within a
panel's jurisdiction.

(i) Did Japan's Request for Establishment meet the specificity requirements of Article 6.2 of the
DSU?
7.101 The issue before us is whether the phrase "subse quent closely connected measures" in Japan's
request for establishment specifically identifies the measures at issue in the dispute, in accordance
with Article 6.2 of the DSU.
125 In resolving this issue, we note that there are no generally applicable
rules to govern whether a measure is identified with sufficient specifici ty for the purpose of
Article 6.2. Rather, in each case, a close examination of the relevant facts is required.
7.102 We recall that the United States' retrospective anti-dumping duty assessment system requires
that importers of products subject to an anti-dumping duty order post a cash deposit of the estimated
amount of anti-dumping duties due. However, interested parties may request an administrative review
to determine the final amount due. If requested, the review takes place each year in the anniversary
month of the publication of the anti-dumping duty order. 126 The subsequent administrative review
supersedes the preceding one, in the sense that the "c ash deposit rate from one review [is] replaced by
the cash deposit rate from the next review". 127 Therefore, there is a high degree of predictability
regarding the future occurrence of subsequent administrative reviews.
7.103 In its panel request, Japan specifies that the request relates to periodic reviews stemming from
a specific anti-dumping duty order, namely the 1989 Anti-Dumping Order. In particular, the request
relates to certain of the periodic reviews assessed by the original panel and "three closely connected
periodic reviews that the United States ar gues superseded the original reviews". 128 The request also
includes "any subsequent closely connected measures". We recall the United States' concern that this
phrase is an attempt "to include in the panel's terms of reference any future administrative reviews
related to the eight identified in its panel request". 129 We consider that the phrase does identify
subsequent periodic reviews, which, if requested, o ccur on an annual basis, wi th sufficient specificity
under Article 6.2 of the DSU. The description of the three "supersed[ing]" periodic reviews (i.e.,
Reviews 4, 5 and 6) as " closely connected" to the original periodic re views indicates that the phrase
"subsequent closely connected measures" covers subsequent periodic reviews, occurring under the
same identified anti-dumping duty order, which "supersede" the reviews named in the panel request.
7.104 In determining whether the panel request specifi cally identifies the measures at issue, we note
that the request serves as the basis fo r the terms of reference for the panel. Further, we note that the
Appellate Body held in Brazil – Desiccated Coconut that:
A panel's terms of reference are important for two reasons. First, terms of reference
fulfil an important due process objective -- th ey give the parties and third parties
sufficient information concerning the claims at issue in the dispute in order to allow
them an opportunity to respond to the complainant's case. Second, they establish the
jurisdiction of the panel by defining the precise claims at issue in the dispute.
 130

125 Although the United States begins para. 50 of its First Written Submission by referring to the whole
of the phrase "any amendments to the eight periodic re views and the closely connected instructions and notices,
as well as any subsequent closely connected measures", the penultimate sentence of that paragraph makes it
clear that the United States "objects to Japan's failure to specifically identify the 's ubsequent closely connected
measures' as required by Article 6.2 of the DSU". Therefore, the Panel does not understand the United States to
dispute that the three amended periodic reviews, referred to in para. 35 of Japan's Response to the Panel
Questions, were identified with sufficient specificity in the request for the establishment of the panel.
126 United States, First Written Submission, paras. 5 and 8.
127 United States, First Written Submission, para. 44.
128 WT/DS322/27, para. 12.
129 United States, First Written Submission, para. 50.
130 Appellate Body Report, Brazil – Desiccated Coconut, page 22.

7.105 In the light of the Appellate Body's statement in this regard, the panel considers, contrary to
the submissions of the United States, that whether or not an Article 6.2 panel request adequately puts
the responding party on notice regarding the case ag ainst it is a relevant consideration when
determining whether the specific measures at i ssue are identified under Article 6.2. In the
circumstances of this case, given the terms of the panel request and the nature of the United States
anti-dumping system, in particular the regularity and predictability associated with administrative
reviews under an anti-dumping order, the United Stat es should reasonably have expected that future
administrative reviews may fall within the panel's juri sdiction. Indeed, in its first written submission,
the United States clearly anticipates its inclusion by expressing concern "that Japan is trying to
include in the panel's terms of reference any fu ture administrative reviews related to the eight
identified in its panel request". 131 Therefore, a finding that the phrase "subsequent closely connected
measures" satisfies the terms of Article 6.2 would not violate any due process objective of the DSU.
7.106 The United States argues that it is impossible specifically to identify a measure not in
existence at the time of a request for the establishmen t of a panel. As a general proposition, it may be
true that it is difficult to identify a future measure. However, the particular facts of this case are such
that it was not impossible for Japan to identify fu ture administrative reviews with the specificity
required by Article 6.2. Under the United States' retrospective anti-dumping duty assessment system,
if requested, administrative reviews for a particular anti-dumping duty order occur at a specific time
each year. Given the predictability associated with such reviews, it does not seem that it would be
impossible to identify them in a panel request. Ind eed, it is clear from the United States' First Written
Submission that the United States realized Japan was identifying such measures.
132
7.107 In the light of the above, we find that the phrase "subsequent closely connected measures"
meets the Article 6.2 requirement to identify the speci fic measures at issue. The examination, in the
following subsection of this report, of the more particular issue regarding whether Review 9 should be
included within the panel's term s of reference, provides furthe r explanation regarding why the
United States' request for a preliminary ruling is rejected.
(ii) Should Review 9 be included in the scope of the proceeding?
7.108 On 11 September 2008, during the course of this Article 21.5 proceeding, the United States
completed the latest administrative review (Review 9) of the 1989 Anti-Dumping Order, concerning
Japanese ball bearings entering the United Stat es during the period 1 May 2006 – 30 April 2007. 133
Japan has asked the Panel to make findings on th is measure. The Panel must decide whether
Review 9 may properly be included in the scope of this proceeding.
7.109 As an initial matter, Japan sought leave from the Panel to file a supplementary brief regarding
Review 9. The United States objected to Japan's request to file a supplemental submission. On
1 October 2008, the Panel informed the parties that it had accepted Japan's request to file a
supplementary submission regarding Review 9. The Panel noted that Japan's request, and the
United States' response thereto, raised substantive issues regarding the interpretation of Article 21.5 of
the DSU that, at that stage, the Panel was not in a position to rule on. Taking into account the
expedited nature of Article 21.5 proceedings, the Panel considered that it would nevertheless be
prudent for Japan to be allowed to file its suppl ementary submission without awaiting, and without
prejudice to, the Panel's decision on the substantive issues involved.

131 United States, First Written Submission, para. 50.
132 United States, First Written Submission, para. 50.
133 Ball Bearings and Parts Thereof From France, Germany, Italy, Japan, and the United Kingdom:
Final Results of Antidumping Duty Administrative Reviews and Rescission of Reviews in Part , 73 Fed.
Reg. 52823 (USDOC, 11 September 2008). Available at: http://edocket.access.gpo.gov/2008/pdf/E8-21137.pdf.

7.110 The first issue we consider is whether Japan' s panel request identifies Review 9 as a specific
measure at issue. In this regard, we note our pr evious finding that the phrase "subsequent closely
connected measures" is sufficiently specific to cove r subsequent periodic reviews. The circumstances
associated with Review 9 in particular, rather than administrative reviews in general, provide
increased support for its inclusion in the panel's terms of reference. Specifically, at the time of Japan's
request for establishment of the panel, Review 9 had already been initiated
134 and once finalised
would become the next administrative review in th e continuum of administrative reviews related to
the 1989 Anti-Dumping Order.
7.111 Further, in relation to the United States' argume nt that it is impossible specifically to identify
a measure not in existence at the time of a reque st for the establishment of a panel, we note our
previous finding that this is not necessarily alwa ys the case, particularly in the context of the
United States anti-dumping system, where there is a high degree of predictability regarding future
administrative reviews. This level of predictability is even higher where a review has already been
initiated at the time of the request for panel establishment.
7.112 The second issue to consider in relation to Revi ew 9 is whether it is a "measure[] taken to
comply" within the terms of Article 21.5 of the DS U. In its supplementary submission, Japan asserts
that Review 9 was included in its panel request135 and that Review 9 enjoys the same close substantive
relationship to Reviews 1, 2 and 3 as Reviews 4, 5 and 6. Moreover, Review 9 constitutes a
replacement measure that supersedes the previous periodic review, establishing a new cash deposit
rate that replaces the cash deposit rate from the prev ious review and determines the importer-specific
assessment rate for entries initially subjected to the cash deposit rate from previous reviews. Japan
also contests the same specific component of Review 9 that it contested with respect to Reviews 4, 5
and 6, identified in its request for the establishment of a panel; namely, the zeroing methodology used
to make dumping determinations.
7.113 The United States contests Jap an's claims. Aside from the preliminary objection under
Article 6.2 of the DSU, the United States argues that Review 9 is not a "measure[] taken to comply"
with the DSB's recommendations and rulings with respect to the application of zeroing in the
administrative reviews of the 1989 Anti-Dumping Order.
7.114 We recall our finding that Reviews 4, 5 and 6 are "measures taken to comply" which are
properly within the scope of this Article 21.5 proceeding.
136 Review 9 is identical in nature and effect
to Reviews 4, 5 and 6. Review 9 supersedes tho se measures, and is therefore the latest link in the
chain of assessment incorporating those measures. Review 9 also continues to apply the zeroing
methodology found to be WTO-inconsistent in the original proceeding. 137 Like Reviews 4, 5 and 6,
therefore, Review 9 is sufficiently closely connected to the original dispute to constitute a "measure
taken to comply" within the meaning of Article 21.5. For the reasons set forth above, therefore, we
find that Japan's claims regarding Review 9 are also properly within the scope of this proceeding.
(iii) Future measures
7.115 The United States also argues that a measure not in existence at the time of a panel request
cannot be the subject of dispute settlement. Th e United States relies on the panel's decision in US –

134 Review 9 was initiated on 29 June 2007 (Initiation of Antidumping and Countervailing Duty
Administrative Reviews, Request for Revocation in Part and Deferral of Administrative Review, 72 FR 35690,
29 June 2007), whereas Japan's request for establishment was filed on 7 April 2008 (WT/DS322/27).
135 WT/DS322/27, para. 12.
136 See para. 7.82 supra.
137 See paras. 7.161 and 7.166 infra.

Upland Cotton to support its contention. 138 In that case, the panel found that a measure implemented
under legislation which, at the time of the panel re quest, "did not exist, had never existed and might
not subsequently have come into existence", was not within its terms of reference and that the claim in
relation to it was "entirely speculative". 139 The panel also based its reasoning on Article 3.3 of the
DSU, which provides:
The prompt settlement of situations in wh ich a Member considers that any benefits
accruing to it directly or indirectly under the covered agreements are being impaired
by measures taken by another Member is essential to the effective functioning of the
WTO and the maintenance of a proper balan ce between the rights and obligations of
Members.
The panel found that the legislation could not have been impairing any benefits accruing to the
complainant because it was not in existence at th e time of the request for the establishment of a
panel.
140
7.116 While we do not disagree with the reasoning of the panel in US – Upland Cotton, the situation
before this panel is different. Im portantly, in this case Japan's claim is not "entirely speculative". As
previously noted, although the parties treat Revi ews 1, 2, 3, 4, 5, 6 and 9 as independent legal
measures, they form part of a continuum, the purpose of which is the ongoing assessment of anti-
dumping duties owed under the 1989 Anti-Dumping Order. Therefore, although Review 9 did not
exist at the time of the panel request, a chain of measures or a continuum existed, in which each new
review superseded the previous one. Review 9 eventu ally came into existence as a part of this chain.
Indeed, at the time of the panel request, although th e Review 9 determination had not yet been made,
Review 9 had been initiated.
141 In this way, the claim in relation to Review 9 was entirely predictable,
rather than "entirely speculative" . In these particular circumstan ces, where the measure in issue
eventually came into existence as part of a continuum that existed at the time of the panel request, and
where the process for bringing about the measure's existence was already underway, we find that
Review 9 is within the panel's terms of referenc e. In these circumstances, unlike the panel in US –
Upland Cotton, we do not consider Article 3.3 of the DSU to be determinative. 142 In reaching the
conclusion that in some circumstances, including in the present dispute, it is possible to challenge a
measure that does not exist at the time of a panel re quest, we note that a measure needs to have come
into existence in order for a panel to make a ruling on it. We do not speculate here regarding the point
in time by which a challenge must be raised in rela tion to a measure not in existence at the time of a
panel request, for a panel to include a ruling on it within its report.

138 United States, Second Written Submission, para. 30 and United States, Response to Japan's
Supplemental Submission, para. 11.
139 Report of the Panel, United States –Upland Cotton, para. 7.158.
140 Report of the Panel, United States –Upland Cotton, para. 7.160.
141 Review 9 was initiated on 29 June 2007 (Initiation of Antidumping and Countervailing Duty
Administrative Reviews, Request for Revocation in Part and Deferral of Administrative Review, 72 FR 35690,
29 June 2007), whereas Japan's request for establishment was filed on 7 April 2008 (WT/DS322/27).
142 We note that the Appellate Body has not ruled out the inclusion of future measures within a panel's
terms of reference. In particular, in US – Softwood Lumber IV (21.5 - Canada) at para. 74, the Appellate Body
stated that it was approp riate for the panel in Australia – Salmon (21.5 – Canada) to have included within its
jurisdiction an import ban on salmon adopted by the State of Tasmania. We note that this import ban did not
exist at the time of the request for the panel's establishment in Australia – Salmon (21.5 – Canada). Further, in
EC - Chicken Cuts the Appellate Body stated, at para. 156, "[t]he term 'specific measures at issue' in Article 6.2
suggests that, as a general rule, the measures included in a panel's terms of reference must be measures that are
in existence at the time of the establishment of the panel. However, measures enacted subsequent to the
establishment of the panel may, in certain limited circumstances, fall within a panel's terms of reference".

C. C
OMPLIANCE IN RESPECT OF REVIEWS 1, 2, 3, 7 AND 8
7.117 Japan challenges an alleged failure by the Un ited States to comply with the recommendations
and rulings of the DSB in respect of the importer-spe cific assessment rates determined in five of the
11 periodic reviews that were at issue in the original proceeding (i.e., Reviews 1, 2, 3, 7 and 8). Japan
asserts that the United States should have taken step s to bring the importer-specific assessment rates
determined in Reviews 1, 2, 3, 7 and 8 into conform ity, since they continue to have legal effect after
the end of the RPT. Japan claims that the United Stat es' failure to act is in violation of Articles 17.14,
21.1 and 21.3 of the DSU, and in continued violation of Articles 2.4 and 9.3 of the AD Agreement,
and Article VI:2 of the GATT 1994.
7.118 The United States denies that it has any implementation obligations in respect of those
importer-specific assessment rates, since they concer n import entries that occurred before the expiry
of the RPT.
1. Main arguments of the parties
7.119 Japan submits that, in accordance with the recommendations and rulings adopted by the DSB
in this dispute, the United States is required to bring its WTO-inconsistent periodic reviews into
conformity with the AD Agreement and with the GATT 1994.
7.120 In terms of when the United States must co mply with the DSB's recommendations and
rulings, Japan contends that Article 21.1 of the DSU provides that "prompt compliance" is "essential".
Where it is "impracticable to comply immediat ely" with the DSB's recommendations and rulings,
Article 21.3 permits an implementing Member a reasonable period of time to comply as an exception
to immediate compliance. In this dispute, that period expired on 24 December 2007. In terms of what
the implementing Member must achieve by the end of the RPT, Japan contends that Article 3.7 of the
DSU specifies that "the first objective of the dis pute settlement system is usually to secure the
withdrawal" of WTO-inconsistent measures. Japan argues that Article 19.1 of the DSU formulates
recommendations and rulings in terms of "bring[ing] " a WTO-inconsistent measure into conformity
with WTO law. Japan asserts that the Appellate Body has recognized that implementing Members
may bring a WTO-inconsistent measure into complia nce "by modifying or replacing it with a revised
measure."
143
7.121 According to Japan, Articles 19.1, 21.1, and 21. 3 of the DSU serve to establish that an
implementing Member is required to bring a measure into conformity with WTO law by taking action
to withdraw, modify, or replace the WTO-inconsiste nt measure before the end of the RPT. Japan
submits that, pursuant to these provisions, action by an implementing Member is required to bring a
WTO-inconsistent measure into conformity with its "pre-existing" WTO obligations whenever the
measure is legally operational after the end of the RPT. Japan asserts that if the United States were
not required to take any action to revise the WTO-in consistent importer-specific assessment rates, the
obligation to "bring the measure[s] into conformity" with WTO law by the end of the RPT is deprived
of all meaning. Rather than bring the measures in to conformity, the United States could continue to
enforce those measures, after the end of the RPT, in blatant disregard of the WTO obligations that it
should have been respecting since 1995, and which a pplied when the periodic reviews were originally
conducted.
7.122 Japan stresses that it is not seeking a retrosp ective remedy. Rather, Japan asserts that, in
providing prospective relief, the implementing Member is required to ensure that any further action it
takes, after the end of the reasonable period of tim e, pursuant to a measure that has already been
found to be WTO-inconsistent, is WT O-consistent. Japan contends that this obligation is consistent

143 Appellate Body Report, US – OCTG from Argentina (21.5 - Argentina), para. 173, note 367.

with the requirement under Article 19.1 of the DSU to "bring the measure into conformity".
According to Japan, by requiring the United States to "bring" the importer-specific assessment rates
into conformity with WTO law with effect from the end of the RPT, the DSU does not require that the
United States retrospectively "undo" legal situations that were fixed at an earlier point in time. Japan
submits that it challenges solely those WTO-incons istent periodic reviews with respect to which
liquidation of entries had not occurred by the end of the RPT and, consequently, the final amount of
anti-dumping duties had not yet been definitively fi nalized or collected. Japan is not asking the
United States to repay duties that have already been definitively collected on liquidated entries.
7.123 Regarding its claim under Article 17.14 of the DSU, Japan contends that the failure to comply
with the recommendations and rulings of the DSB w ithin the reasonable period of time is a violation
of Article 17.14 of the DSU because it indicates that the Appellate Body report has not been
"unconditionally accepted" by the United States. W ith respect to the five periodic reviews found
inconsistent in the original proceedi ngs, Japan argues that the United States' omission to bring the
importer specific assessment rates into confor mity with the covered agreements represents
"conditional acceptance" of the Appellate Body report.
7.124 The United States rejects Japan's claim in respect of the five abovementioned administrative
reviews. The United States relies primarily on th e prospective effect of WTO dispute settlement
remedies, arguing that implementation should be assessed by looking at the treatment accorded to
goods entered after the expiry of the RPT. The Un ited States submits that, because of the prospective
effect of WTO dispute settlement remedies, it did no t have any implementation obligations in respect
of import entries subject to the administrative review s at issue in the original proceedings because all
of those entries occurred prior to the expiry of th e RPT. Rather, implementation obligations arising
from the DSB's recommendations and rulings in this dispute only applied to future entries. The
United States asserts that the measures pertaining to the five reviews were withdrawn because the
United States no longer applies these measure to fu ture entries. As a result, the final liability
determined in these no longer serves as the basis for anti-dumping liability on entries occurring after
the RPT. This withdrawal was accomplished as an incidental consequence of the United States' anti-
dumping system. According to the United States, it has therefore withdrawn the results of the five
administrative reviews within the meaning of Article 3.7 of the DSU and fully complied with the
DSB's recommendations and rulings as they relate to these administrative reviews.
144
7.125 The United States asserts that the text of the GATT 1994 and the AD Agreement demonstrate
that it is the legal regime in existence at the time that an import enters the Member's territory that
determines whether anti-dumping duties apply to the import. The United States notes in this regard
that Article VI:2 of the GATT 1994 authorises a Member to "levy on any dumped product an
anti-dumping duty not greater in amount than the margin of dumping in respect of such product."
According to the United States, Article VI:6(a) of GATT 1994 reflects the fact that the levying of a
duty generally takes place in connection with "the importation of any product." Furthermore, the
United States asserts that the interpretive note to paragraphs 2 and 3 of Article VI states:
As in many other cases in customs administration, a contracting party may require
reasonable security (bond or cash deposit) for the payment of anti-dumping or
countervailing duty pending fina l determination of the facts in any case of suspected
dumping or subsidization.
145

144 The United States notes that, under Article 3.7, "[i]n the absence of a mutually agreed solution, the
first objective of the dispute settlement mechanism is usually to secure the withdrawal of the measures
concerned if these are found to be inconsistent with the provisions of any of the covered agreements."
145 Annex I, GATT 1994, Ad Article VI, paras. 2 and 3.

7.126 According to the United States, the interpretive note clarifies that, notwithstanding that duties
are generally levied at the time of importation, Members may instead require cash deposits or other
security, in lieu of the duty, pending final dete rmination of the relevant information. The
United States asserts that the cash deposits theref ore serve as a place-holder for the liability which is
incurred at the time of entry.
7.127 The United States submits that several provisions of the AD Agreement further demonstrate
that determining whether relief is "prospective" or "retroactive" can only be assessed by reference to
date of entry. The United States refers for example to Article 10.1 of the AD Agreement, which states
that provisional measures and antidumping duties sha ll only be applied to "p roducts which enter for
consumption after the time" when the provisional or final de termination enters into force, subject to
certain exceptions. According to the United States, Article 10.1 demonstrates that the critical factor
for determining whether particular entries ar e liable for the assessment of antidumping or
countervailing duties is the legal regime in existence on the date of entry.
7.128 The United States contends that, similarly, Article 8.6 of the AD Agreement states that if an
exporter violates an undertaking, duties may be assessed on products "entered for consumption not
more than 90 days before the application of . . . provisional measures, except that any such retroactive
assessment shall not apply to imports entered before the violation of the undertaking." The
United States asserts that, once ag ain, the critical factor for determining the applicability of the
provision is the date of entry.
7.129 The United States further notes that Article 10.6 of the AD Agreement states that when certain
criteria are met, "[a] definitive anti-dumping duty ma y be levied on products which were entered for
consumption not more than 90 days prior to the date of application of provisional measures . . . .",
whereas under Article 10.8 "[n]o duties shall be le vied retroactively pursuant to paragraph 6 on
products entered for consumption prior to the da te of initiation of the investigation." The
United States submits that, as with Articles 8.6 and 10.1, whenever the AD Agreement specifies an
applicable date for an action, the scope of appli cability is based on entries occurring on or after that
date.
7.130 The United States asserts that Japan's argument would result in inequality between the
retrospective and prospective anti-dumping systems. Thus, the United States asserts that if an anti-
dumping measure in a prospective system is found to be inconsistent with the AD Agreement , the
Member's obligation is merely to modify the measure as it applies to imports occurring on or after the
date of implementation. That is, the Member changes the amount of anti-dumping duties to be
collected on importations occurring after the end of th e RPT, but need not remedy the effects of the
measure on imports that occurred prior to the date of implementation. The United States contends
that if the issuance of assessment or liquidation instructions after the RPT forms the basis for
implementation obligations, as Japan wants, then retrospective systems will be subject to very
different and more extensive implementation obligations than prospective antidumping systems.
7.131 Furthermore, the United States contends that Japan's argument impermissibly makes the
implementation obligations of Members dependent on domestic litigation in the United States.
According to the United States, liquidation of the re levant entries did not occur because those entries
were subject to domestic litigation in the United States that included court injunctions suspending
liquidation during the pendency of the litigation. Th e United States contends that Japan's theory of
US implementation obligations is dependent on the existence of these injunctions because, without
them, the United States would have liquidated all of the entries from the five administrative reviews
long before the end of the implementation period in this dispute. The United States asserts that the
fact that Japan's theory of implementation is dependent on these injunctions demonstrates that Japan is
attempting to rely on domestic US litigation to alter its WTO rights, but the obligations at issue under
the covered agreements do not change depending on the existence of domestic litigation.

7.132 Regarding the alleged violation of Articles 17.14, 21.1 and 21.3 of the DSU, the United States
asserts that Article 21.1 imposes no substantive ob ligations upon Members. According to the
United States, Article 21.1 merely states why "promp t compliance" is "essential" to the WTO dispute
settlement system. The United States does not accept th at the panel reports cited by Japan support its
claim that Article 21.1 includes an obligation to comp ly promptly. Rather, the reports simply affirm
the importance of prompt compliance in WTO di sputes and do not find any measures inconsistent
with Article 21.1. The United States takes particular issue with Japan's reliance upon US – FSC (21.5
- EC)(II), 146 because the panel explicitly refused to c onsider whether Article 21.1 imposed an
obligation on Members. With respect to Article 21.3, the United States claims that it provides
Members with a right to a reasonable period of time in which to comply with the DSB
recommendations and rulings. The only obligation it imposes upon Members is to inform the DSB of
the Member's intention regarding implementation. There is no obligation of "prompt compliance".
7.133 With respect to the alleged violation of Artic le 17.14, the United States argues that Japan has
not identified a measure that would show conditional acceptance by the United States of the Appellate
Body report. In response to Japan's argument that the omission by the United States to bring the
importer specific assessment rates into conformity with WTO obligations represents such a measure,
the United States asserts that "nothing...can cha nge the fact that the United States unconditionally
accepted the recommendations and rulings of the DSB in this dispute. On 20 February 2007, the
United States notified the DSB of its intention to implement those recommendations and rulings". 147
According to the United States, Japan is attemp ting to cast the disagreement concerning compliance
into "conditional acceptance" by the United States.
2. Main arguments of the third parties
7.134 China notes that after the end of the RPT, the administrative reviews continue to produce
legal effects that are WTO-inconsistent, in that th e importer specific assessment rates that apply were
determined using zeroing. Therefore, the Un ited States has not complied with the DSB's
recommendations and rulings. The approach advo cated by the United States would undermine the
objective and purpose of the WTO dispute settlement system.
7.135 The European Communities considers that the date of entry of an import is irrelevant when
assessing the United States' compliance in this case. Prospective implementation requires that the
United States not take any positive acts after the end of the RPT that are contrary to the DSB's
recommendations and rulings in the original disput e. The European Commun ities considers that its
interpretation does not create inequalities betw een retrospective and prospective anti-dumping
systems. Under both systems, the implementation obligations are the same – after the end of the RPT,
no new action can be taken that is inconsistent with the DSB recommendations and rulings, regardless
of the date of entry of the import affected by the action. Further, in resp onse to the United States'
argument that its WTO rights and obligations s hould not change depending on the existence of
domestic litigation, the European Communities asserts that, regardl ess of the existence of domestic
litigation, any actions taken after the end of th e RPT must conform to the AD Agreement, as
interpreted in the DSB recommendations and rulings.
7.136 Hong Kong, China rejects the United States' argument that its implementation obligations
apply only to goods imported after the expiry of the RPT. Rather, Hong Kong, China notes that
certain goods that entered the United States prior to 24 December 2007 could be liquidated by the
United States after the expiry of the RPT on the b asis of administrative reviews already found to be
WTO inconsistent. Hong Kong, China submits that it is this continuous legal effect, after the end of
the RPT, that is relevant to th e implementation obligations of the United States. Further, Hong Kong,

146 Panel Report, US – FSC (21.5 - EC)(II).
147 United States, Second Written Submission, para. 72.

China argues that the relief sought by Japan is prospec tive rather than retrospective in nature. This is
because the United States is required to ensure that any action it ta kes as of the end of the RPT is
WTO-consistent. Finally, Hong Kong, China reject s the United States' contention that should Japan
prevail, inequality between prospective and re trospective anti-dumping duty assessment systems
would be created. Any differenc es in implementation obligations merely reflect the intrinsically
different features and characteristics of the two systems, as envisaged under the AD Agreement.
7.137 Mexico argues that the United States has taken no implementation action in relation to
Reviews 1, 2, 3, 7 and 8. The re views continue to have significant legal effects after the end of the
RPT, including the potential application of errone ous importer specific assessment rates to entries
unliquidated at the end of the RPT. Further, Mexi co asserts that Japan is not seeking a retrospective
remedy. The implementation obligation does not requi re repayment of duties that have already been
assessed and collected on liquidated entries. Rather, the obligation focuses on future actions to collect
anti-dumping duties. Finally, the position advocated by Japan does not create an inequality between
prospective and retrospective anti-dumping syst ems. The interpretation advocated by the
United States would allow Members with retrosp ective systems perpetually to evade their WTO
obligations, while requiring Members with prospective systems to comply.
7.138 Thailand argues that if the United States' implemen tation obligations applied only in relation
to imports entering the United States after the end of the RPT, the United States will be able to escape
the requirements of Article 9.3 of the AD Agreement.
3. Evaluation by the Panel
7.139 Japan's claims require us to determine whet her or not the United States was required to
comply with the recommendations and rulings of the DSB in respect of any importer-specific
assessment rates determined in Reviews 1, 2, 3, 7 and 8
148 that apply to entries that were, or will be,
liquidated after the end of the RPT.149
7.140 The United States rejects Japan's claim on the b asis that Japan is seeking a "retrospective"
remedy. According to the United States, "[i]mplementation of the DSB's rulings and
recommendations in these disputes applies prospectively".150 Japan denies that it is seeking a
retrospective remedy. 151 In assessing the United States' implementation obligations, we note that
neither the DSU nor the AD Agreement uses the terms "prospective" or "retrospective" to describe

148 Japan's claims also refer to certain amendments to Reviews 1, 2 and 3 (para. 35 of Japan's replies to
Questions from the Panel). These amendments are co vered by Japan's request for establishment (see the
reference to "any amendments to the eight periodic review s" at para. 12 thereof). The United States asserts that
these amendments are not relevant to this proceeding, since they were the result of U.S. court orders unrelated to
the DSB's recommendations and rulings in this dispute and did not alter the zeroing procedures employed in
Reviews 1, 2 and 3 (United States letter to the Panel of 5 December 2008, fifth paragraph, and para. 20 of
United States' Comments on Japan's Replies). We note that the importer-specific assessment rates resulting
from Reviews 1, 2 and 3 were recal culated following the amendments ch allenged by Japan (Exhibits US-A28
and A29, for example). We therefore include these recal culated importer-specific assessment rates in the scope
of our findings, since the recalculat ed importer-specific assessment rates replace those initially determined by
USDOC. In other words, it is the recal culated importer-specific assessment rates that should have been brought
into conformity. We note in this regard that the United States has not formally challenged the inclusion of the
amendments in this proceeding.
149 Although the United States challenges Japan's assertion that none of the relevant entries had been
liquidated by the end of the RPT, the United States does not claim that all of the entries had been liquidated by
that date (United States, Comments on Japan's Replies, paras 17 and 18). At least some entries, therefore, have
been, or will be, liquidated after the end of the RPT. Our findings concern the importer-specific assessment
rates applicable to those entries.
150 United States, First Written Submission, para. 54 (emphasis in original).
151 Japan, First Written Submission, paras 141 – 145.

Members' implementation obligations. Accordingly, we do not consider it appropriate to resolve the
issue before us on the basis of whether Japan is seeking a "prospective" or "retrospective" remedy. 152
Instead, we shall have regard to those provisions of the covered agreements that explicitly address
Members' implementation obligations.
7.141 We begin by considering Article 19.1 of the DS U, on the basis of which the Appellate Body
(and subsequently the DSB, upon its adoption of th e Appellate Body's Report) recommended that the
United States bring Reviews 1, 2, 3, 7 and 8 "into conformity" with the releva nt covered agreements.
We also consider Article 3.7 of the DSU, which spec ifies that "[i]n the absence of a mutually agreed
solution, the first objective of the dispute settlement system is usually to secure the withdrawal" of
WTO-inconsistent measures. In th is regard, we note that the Appellate Body has recognized that the
inconsistent measure to be withdrawn can be bro ught into compliance "by modifying or replacing it
with a revised measure." 153 A measure may also be considered to have been withdrawn if it expires.
In accordance with these provisions, therefore, the United States was required to bring Reviews 1, 2,
3, 7 and 8 "into conformity", by withdrawing, modi fying or replacing them, to the extent they had not
already expired.
7.142 The DSU also specifies the time-frame within wh ich the United States must comply with that
requirement. In this regard, whereas Article 19 is entitled "Panel and Appellate Body
Recommendations", Article 21 of the DSU is entitled "Surveillance of Implementation of
Recommendations and Rulings". Paragraph 3 of Article 21 provides in relevant part:
At a DSB meeting held within 30 days afte r the date of adoption of the panel or
Appellate Body report, the Member concerne d shall inform the DSB of its intentions
in respect of implementation of the recomme ndations and rulings of the DSB. If it is
impracticable to comply immediately w ith the recommendations and rulings, the
Member concerned shall have a reasonable period of time in which to do so...
7.143 We interpret the second sentence of Article 21.3 as imposing a deadline within which the
United States' obligations under Article 19.1 were to be fulfilled. According to Article 21.3, the
United States was required to implement the reco mmendations and rulings of the DSB "immediately"
or, at the latest, after a specified "reasonable peri od of time". Consistent with this provision, the
United States and Japan agreed that the United St ates should have a "reasonable period of time" in
which to comply. That RPT expired on 24 December 2007.154
7.144 Thus, pursuant to Articles 3.7, 19.1, and 21.3 of the DSU, the United States was required to
bring Reviews 1, 2, 3, 7 and 8 "into conform ity" by 24 December 2007. By that date, the
United States was required to have withdrawn, modifi ed or replaced those measures, if they had not
already expired.
7.145 The United States contends that it met its comp liance obligations by withdrawing Reviews 1,
2, 3, 7 and 8 by the end of the RPT. In particular, the United States asserts that it "eliminated the cash
deposit rates established by the administrative reviews that were found to be WTO-inconsistent in the
original proceeding". 155 According to the United States, "not hing remains to be done to come into
compliance with the DSB's recommendations and rulings".156

152 For this reason, it is not necessary for us to revi ew the parties' arguments regarding the application
and interpretation of the ILC Articles on State Responsibility (which Japan "relies on ... to show that it pursues
prospective relief", Japan, Second Written Submission, para. 149).
153 Appellate Body Report, US – OCTG from Argentina (21.5 - Argentina), para. 173, note 367.
154 WT/DS322/20.
155 United States, First Written Submission, para. 54.
156 United States, First Written Submission, para. 54.

7.146 We recall that, in addition to fixing exporter-sp ecific cash deposit rates to be applied to future
import entries, administrative reviews also determine importer-specific assessment rates in respect of
entries that occurred during the review period. The importer-specific assessment rates determined
in 1, 2, 3, 7 and 8 are an integral part of t hose measures, and were also covered by the DSB's
recommendations and rulings regarding those measures.
157 Although the United States has explained
how it claims to have complied with the recomme ndations and rulings of the DSB regarding the
relevant exporter-specific cash deposit rates, the United States has not explained how it complied with
the DSB's recommendations and rulings regarding th e relevant importer-specific assessment rates.
Indeed, we understand the United States to assert th at it has done "nothing" in respect of these
measures. The United States posits that it was not required to implement in respect of the importer-
specific assessment rates because they relate to import entries occurring before the expiry of the RPT.
According to the United States, Article VI:2, Ar ticle VI:6(a), and the interpretative note to
paragraphs 2 and 3 of Article VI of the GA TT 1994, and Articles 10.1, 8.6 and 10.6 of the AD
Agreement, dictate that "it is the legal regime in ex istence at the time that an import enters the
Member's territory that determines whether antidumping duties may apply to the import".158
7.147 We do not consider that the United States' views concerning the "legal regime in existence at
the time of entry" provides support for its argume nt that no implementation obligations exist in
respect of the importer-specific assessment rates at issue. Rather, this assertion seems to be no more
than a statement of a basic rule that import entries should only be liable for anti-dumping duties if an
anti-dumping measure (or "order", in US parlance) was in place at the time of entry. If no such anti-
dumping "regime" were in place at that time, the relevant entries should not be liable for anti-dumping
duties. In addition, while the United States c ontends that the text of the abovementioned AD
Agreement and GATT 1994 provisions "confirms that the focus for implementation purposes should
be on the time of entry of merchandise",
159 in fact not a single word of those provisions addresses the
issue of how a Member should implement the r ecommendations and rulings of the DSB. Thus,
although the United States may be correct in assertin g that "whenever the AD Agreement specifies an
applicable date for an action, the scope of appli cability is based on entries occurring on or after that
date",160 the point is that the AD Agreement does not specify any applicable date for implementation
action. Accordingly, the AD Agreement does not require that the "scope of applicability" of
implementation action be based on the date of import entry.
7.148 In our view, the United States' implementation obligations should rather be determined by
reference to the abovementioned provisions of the DSU, which deal specifically with the
implementation of the recommendations and rulings of the DSB. The focus of those provisions is the
measure found to be WTO-inconsistent, and the need to bring that measure "into conformity" by the
end of the RPT. There is no reference in those provis ions to the date of import entry. The relevant
date for the purposes of Articles 3.7, 19.1 and 21 .3 of the DSU (in cases where immediate compliance
is impracticable) is rather the expiry of the RPT. If a measure found to be WTO-inconsistent is to be
applied after the expiry of the RPT, that measure must have been brought "into conformity",
irrespective of the date of entry of the imports covered by that measure.

157 We note that the United States adopted a similar vi ew in its reply to Question 9(a) from the Panel,
where the United States asserted that "[t]he measur e at issue in the original proceeding included the
determination of final antidumping liability in Review Nos. 1, 2 and 3; and as part of the determinations of final
liability in those reviews, Commerce determined importer-s pecific assessment rates." We therefore understand
the United States to accept that importe r-specific assessment rates form part of the measures at issue in the
original proceeding.
158 United States, First Written Submission, para. 59.
159 United States, First Written Submission, para. 59.
160 United States, First Written Submission , para. 64.

7.149 Consistent with the above analysis, the Un ited States was required to have brought the
importer-specific assessment rates determined in Reviews 1, 2, 3, 7 and 8 (and subsequent
amendments thereto) 161 "into conformity" with the covered agreements by 24 December 2007.
However, the importer-specific assessment rates determined in Reviews 1, 2, 3, 7 and 8 that Japan has
challenged in this compliance proceeding had not been withdrawn by that date. 162 Rather, those
importer-specific assessment rates continued to have legal effect after the end of the RPT, 163 in the
sense that they continued to provide the authority for the collection of anti- dumping duties in respect
of the relevant (unliquidated) import entries. In fact, in the absence of any modification of those
importer-specific assessment rates, 164 the status of those measures has not changed since the original
proceeding, in which they were found to be WTO-in consistent. In these circumstances, we conclude
that the United States failed to bring those importe r-specific assessment rates "into conformity" by
24 December 2007.
7.150 The United States contends that such an appr oach creates inequality between retrospective
and prospective anti-dumping systems, primarily b ecause the concept of an unliquidated entry does
not exist in the context of prospective systems. We understand the United States to argue that, since
anti-dumping duties under a prospective system are collect ed, or liquidated, at the time of entry, there
is in principle no possibility of entries remaining unliquidated at the end of any RPT. Even if the
prospective anti-dumping duty were found to be WTO-in consistent, the collection, or liquidation, of
that duty would remain unaffected by the relevant Member's implementation obligations, since it
would have occurred long before the end of the RPT. Under a retrospective system, though, the
collection of anti-dumping duties might not occur until after the expiry of the RPT. If the relevant
Member's implementation obligations were not restricted to the date of the import entry in respect of
which collection is being made, those implementati on obligations would affect the collection of the
anti-dumping duty.
7.151 There is disagreement between the parties regard ing the validity of the concern raised by the
United States. Japan submits that, even under a prospective assessment system, a periodic review
found to be WTO-inconsistent coul d produce legal effects after the end of the RPT. Japan contends
that such review would have to be brought into conformity as of the end of the RPT, even though the
relevant (unliquidated) entries occurred before that date. According to Japan, therefore, the
implementation obligations under both the prospec tive and retrospective assessment systems are
equal.
7.152 We see no need to resolve this particular disag reement between the parties, for we do not
consider that our task is to ensure that th e implementation obligations under prospective and
retrospective assessment systems are identical. The f act is that the two systems are different, and it is
presumably such differences that lead Members to choose one system over the other. If we were
required to ensure that there were no material di fferences between the operation of the two systems,
there would be little point in Article 9 of the AD Agreement providing Members with that choice.
Having chosen one system over the other, Members must respect the consequences of that choice.
Contrary to the United States, we do not consider that such an approach is at odds with the Appellate
Body's view that "[t]he Anti-Dumping Agreement is neutral as between different systems for levy and

161 We refer in this regard to the amendments cited at para. 35 of Japan's Replies to Questions from the
Panel.
162 The United States has not alleged that the importe r-specific assessment rates expired before the end
of the RPT.
163 We are guided in this regard by the Panel Report, EC – Commercial Vessels , in which the panel
required the European Communities to take action to implement the recommendations and rulings of the DSB
with respect to WTO-inconsistent measures "to the extent that [they] continue to be operational" (para. 8.4).
164 We note that the United States does not argue that the amendments specified at para. 35 of Japan's
Replies to Questions constitute withdrawal of the relevant WTO-inconsistent measures.

collection of anti-dumping duties".
165 First, we note that the Appellate Body's statement confirms the
fact that the prospective and retr ospective assessment systems are i ndeed "different". Second, the
Appellate Body's statement concerns the AD Agreement , not the DSU. Third, the fact that the
underlying differences between the prospective and retrospective assessment systems may have
practical consequences for how Members come into compliance with the recommendations and
rulings of the DSB does not mean that the DSU favours one system over the other; it is simply a
reflection of those underlying differences.
7.153 Finally, we note the United States' argument that the only reason why liquidation did not
occur before the end of the RPT was because the relevant import entries were subject to domestic
litigation that included court injunctions susp ending liquidation during the pendency of that
litigation.166 We do not consider that the abovementioned provisions of the DSU provide for such
considerations to be taken into account. 167 Instead, those provisions require universal compliance by
the end of the RPT, no matter the factual circumstances of any given case.
7.154 In light of the above, we find that the United States has failed to comply with the
recommendations and rulings of the DSB regarding the importer-specific assessment rates determined
in Reviews 1, 2, 3, 7 and 8 that apply to entri es covered by those Reviews that were, or will be,
liquidated after the expiry of the RPT. Accordi ngly, we find that the United States remains in
violation of Articles 2.4 and 9.3 of the AD Agreement, and Article VI:2 of the GATT 1994, in respect
of those importer-specific assessment rates.
7.155 We recall that Japan has also brought claims unde r Articles 21.1, 21.3 and 17.14 of the DSU.
The basic issue before us is whether or not the United States has complied with the recommendations
and rulings of the DSB regarding the re levant importer-specific assessment rates. 168 We have found
that it has not, and that it therefore remains in violation of Articles 2.4 and 9.3 of the AD Agreement,
and Article VI:2 of the GATT 1994. In this c ontext we do not need to examine whether the
United States' failure to implement violates various provisions of the DSU. This is in accordance with
the Appellate Body's statement in Canada – Wheat Exports that a panel may refrain from making
multiple findings that the same measure is inconsiste nt with various provisions of covered agreements
when a single finding will resolve the dispute. 169 Accordingly, we decline to consider Japan's claims
under the abovementioned provisions of the DSU.

165 Appellate Body Report, US – Zeroing (Japan), para. 163.
166 The United States also argues that Japan's theo ry of implementation is dependent on such
injunctions, demonstrating that Japan is attempting to re ly on US litigation to alter its WTO rights. We do not
consider that the United States' implementation obligations may be said to have been altered by virtue of the
relevant injunctions. The United States' basic implementation obligation is to bring the relevant measures into
conformity by the end of the RPT. That obligation derives from the abovementioned provisions of the DSU. It
does not result from US domestic law.
167 The United States asserts that the Panel should not allow factors "not provided for by the terms of"
the covered agreements, such as the rights of private parties in domestic litigation, "to add to or diminish the
rights and obligations of Members" (United States, Second Written Submission, para. 56). We are not
persuaded by this argument. We have found that the United States is in continued violation of various
provisions of the covered agreements. The reasons why the United States finds itself in continuing violation are
not pertinent to our findings.
168 We accept that Article 21.5 proceedings are no t concerned uniquely with implementation of the
DSB's recommendations and rulings. Ar ticle 21.5 proceedings might also include additional claims regarding
"measures taken to comply" that were necessarily not raised in the original dispute (see Appellate Body Report,
Canada – Aircraft ( 21.5 – Brazil), para. 40). This is not the case here , though, since Japan's DSU claims are
entirely dependent on a finding that the United States has failed to implement the recommendations and rulings
of the DSB.
169 Appellate Body Report, Canada – Wheat Exports, para. 133.

D. COMPLIANCE IN RESPECT OF REVIEWS 4, 5, 6 AND 9
7.156 We recall our earlier findings that Japan's claims regarding Reviews 4, 5, 6 and 9 are properly
within the scope of this Article 21.5 proceeding. 170 We shall now examine the substance of those
claims.
(a) Main arguments of the parties
7.157 Japan claims that Reviews 4, 5, 6 and 9 are in consistent with Articles 2.4 and 9.3 of the AD
Agreement, and Article VI:2 of the GATT 1994, because the United States applied zeroing when
calculating margins of dumping to determine cas h deposit rates and impor ter-specific assessment
rates.
7.158 Japan refers to Computer Program Excerpts to demonstrate that zeroing was used by USDOC
in the context of Reviews 4, 5, 6 and 9. Japan contends that the United States' use of zeroing in
Reviews 4, 5, 6 and 9 is confirmed by USDOC's I ssues and Decisions Memoranda. Japan asserts that
USDOC expressly confirms the use of zeroing in th ese documents, rejecting the respondents' requests
for it to abandon zeroing. In addition, in its rep lies to certain Questions from the Panel, Japan
calculated what the cash deposit rates and importer-speci fic assessment rates in Reviews 4, 5, 6 and 9
would have been had USDOC not used zeroing in tho se reviews. According to Japan, the margins of
dumping determined in Reviews 4, 5, 6 and 9 would, in most cases, have been zero without zeroing.
Japan asserts that the margins determined in th e remaining cases would have been significantly
reduced.
7.159 The United States does not deny that it applied zeroing in these administrative reviews. 171
However, the United States argu es that Japan must establish a prima facie case with respect to the
inconsistency of these reviews and that Japan's mere reference to prior reports on this subject is
insufficient for this purpose. Additionally, the Un ited States argues more generally that the presence
of zeroing programming language in reviews does not establish that individual importer-specific
assessment rates were affected by zeroing procedures because, if a given importer had no sales with
"negative margins", zeroing would not be employed in that importer's assessment rate, irrespective of
the presence of the programming language.
(b) Evaluation by the Panel
7.160 We recall that, in the original proceeding, USDOC's use of zeroing was established by
reference to the use of a line of comput er code called the "standard zeroing line".
172 I n t h i s
proceeding, Japan has provided evidence that the standard zeroing line was also applied by USDOC
in Reviews 4, 5, 6 and 9. This evidence takes th e form of the Computer Program Excerpts submitted
to the Panel as Exhibits JPN-91.1.A, JPN-91.1.B, JPN-91.1.C, JPN-91.1.D, JPN-91.2.A, JPN-91.2.B,
JPN-91.2.C, JPN-91.2.D, JPN-91.3.A, JPN-91.3.B, JPN-91.3.C, JPN-91.3.D, JPN-91.3.E, JPN-91.4.A
and JPN-91.4.B.
173 An overview of these exhibits is provided in Exhibit JPN-91.A. Japan relies on
an explanation of the mechanics of the standard zeroing line submitted as Exhibit JPN-1 in the
original proceeding. Japan has also submitted an updated version of that document, as well as a

170 See paras. 7.82 and 7.114.
171 The United States' position is premised on its argu ment that Reviews 4, 5, 6 and 9 are not covered
by these proceedings because they are not "measures taken to comply" within the meaning of Article 21.5 of the
DSU.
172 See, for example, para. 7.51 of the original Panel Report, US – Zeroing (Japan).
173 The Exhibit JPN-91 series updates and supplements the Exhibit JPN-42, 43 and 44 series. Whereas
the latter detailed USDOC's overall weighted-average margin of dumping calculations for Reviews 4, 5 and 6,
the Exhibit JPN-91 series details both USDOC's overall weighted-average margin of dumping calculations and
its import-specific assessment rate calculations, for Reviews 4, 5, 6 and 9.

supplement to the updated version, in the form of Exhibits JPN-37 and JPN-91, which explain the
application of the standard zeroing line in the context of Reviews 4, 5, 6 and 9. The evidence
submitted by Japan shows that USDOC applied th e standard zeroing line, "WHERE EMARGIN GT
0", in each of Reviews 4, 5, 6 and 9.
7.161 Japan has also submitted the USDOC Issues and Decisions Memoranda for Reviews 4, 5, 6
and 9. These documents are set forth in Exhibits JPN-74, JPN-75, JPN-76 and JPN-67.B respectively.
In the Issues and Decision Memorandum concerning Review 4, USDOC states "we do not allow U.S.
sales that were not priced below normal value ... to offset dumping margins we find on other U.S.
sales."
174 The same statement is contained in the Memorandum concerning Review 5. 175 Regarding
Reviews 6 and 9, USDOC states that it does "not permit the[] non-dumped sales to offset the amount
of dumping found with respect to other sales." 176 Having reviewed the abovementioned evidence
submitted by Japan, we find that Japan has established prima facie that the United States applied
zeroing in Reviews 4, 5, 6 and 9. The United Stat es has not denied that it applied zeroing in those
determinations.177 Accordingly, we find that USDOC applied zeroing in Reviews 4, 5, 6 and 9.
7.162 With regard to the United States' argument a bout a lack of evidence demonstrating that
individual importer-specific assessment rates were a ffected by zeroing, we note that the Appellate
Body's findings in the original proceeding were not based on evidence that particular importers had
sales with negative margins or that individual impor ter-specific assessment rates were affected by the
application of zeroing procedures. We do not consid er, therefore, that Japan must show that given
importers had sales with negative margins under Reviews 4, 5, 6 and 9, or the effect of zeroing on the
importer-specific assessment rates determined in t hose Reviews. In any event, Japan has submitted
evidence establishing the quantitative impact of zeroing on the duty collection rates in the subsequent
administrative reviews at issue in this proceeding. In particular, Japan has submitted calculations of
what the exporter-specific margin s of dumping and importer-specific assessment rates in Reviews 4,
5, 6 and 9 would have been if the "standard zeroi ng line" of computer code had been switched off. 178
Japan claims that its calculations used exactly the same data set as that initially used by USDOC.
Japan also claims that, other than switching off the relevant line of computer code, its calculations are
identical to those initially performed by USDOC. Jap an's calculations show that, in the majority of
cases, no anti-dumping duties would have been collected if zeroing had not been employed. Japan's
calculations further show that, in the remaini ng cases, the amounts of anti-dumping duties would be
significantly lower absent zeroing.
7.163 The United States has challenged neither the resu lts of the calculations performed by Japan,
nor the accuracy of the data set used in those calculations. Instead, the United States argues that
Japan has "improperly relied on"
179 the abovementioned revised dumping programs with the specific
programming language eliminated to switch off the zeroing procedures. The United States contends
that these revised programs were created by Japan for this compliance proceeding, and that USDOC
has never employed these programs. Accordingly, "the United States does not concede that the
results obtained by Japan would be the results obtained by Commerce if it had not employed
zeroing."180

174 Exhibit-JPN 74, page 10.
175 Exhibit JPN-75, page 11.
176 Exhibit JPN-76, page 8, and Exhibit JPN-67.B, page 9.
177 We recall that the United States' position is premised on its argument that Reviews 4, 5, 6 and 9 are
not covered by these proceedings because they are not "measures taken to comply" within the meaning of
Article 21.5 of the DSU.
178 Japan's Response to Question 19 from the Panel (inc luding in particular Table 3, and Annexes 4, 5,
6 and 9), as updated by Japan's Updated Response of 10 December 2008.
179 United States' Comments on Japan's Replies, para. 22.
180 United States' Comments on Japan's Replies, para. 22, note 38.

7.164 We do not accept the United States' argument that it was "improper" for Japan to rely on
amended USDOC programmes so as to show the imp act of zeroing on the relevant margins and
assessment rates. Indeed, it is difficult to con ceive of - and the United States (as the party asserting
that Japan must demonstrate the impact of zeroing) has not identified - other means available to Japan
to show the impact of zeroing. Furthermore, although the United States does not concede that the
results obtained by Japan would be the results obtained by USDOC if it had not employed zeroing, the
absence of such concession is not equivalent to a re buttal of Japan's evidence, or a demonstration that
the results of Japan's calculations are somehow erroneous. Furthermore, we note the following
findings by the Appellate Body regarding the treatment of a similar issue by another panel:
Even if printouts of margin calculation programs, or the calculation tables prepared
by the European Communities, were not issued by the USDOC during the review at
issue, we question the significance of th is for a conclusion that the documents
submitted are not probative as evidence of si mple zeroing in periodic reviews. While
it may have simplified the Panel's task if the evidence submitted by the European
Communities had been confirmed as orig inal USDOC documents, the absence of
authentication does not negate the evidentia ry significance of those documents. As
we understand it, the USDOC provides margin calculation programs at the end of
anti-dumping proceedings to interested parties in paper and/or electronic format, and
it is from these programs that the origin al margin calculation program can be
replicated, or the underlying data can be extracted to produce other documents such
as the calculation tables submitted by the Eu ropean Communities. As the European
Communities maintains, "the printed pape r version of the margin programme is
identical to the electronic version provided b y [ t h e ] U S D O C " . W e a l s o n o t e t h e
argument of the European Communities that the United States does not allege that the
printouts have been altered, or otherwise challenge that the content or underlying data
of the documents was generated by the USDO C. Accordingly, the printouts of the
margin calculation programs appear to have their origins in original USDOC
documents, and we see no basis to conclude that such documentation differs in any
material respect from the original program . Thus, while an authenticated USDOC
document may have offered greater certainty as to its content, we do not agree that
this renders a document that has not been authenticated not probative of the fact
asserted, particularly if it is produced or replicated from documents or data supplied
by the USDOC.
181
7.165 The Appellate Body further found:
that the Panel, by insisting on authenticated USDOC documents to demonstrate or
show the use of simple zeroing, also failed to make an objective assessment by
allowing a challenge to the authenticity of evidence originating from the USDOC, but
later reproduced by interested parties, to skew its consideration of the probative value
of that evidence.
182
7.166 For these reasons, we reject the United States ' arguments against the evidence submitted by
Japan to show that the relevant margins and assessment rates were a ffected by zeroing. In our view,
the evidence submitted by Japan is sufficient to establish a prima facie case that the exporter-specific
margins of dumping and importer-sp ecific assessment rates determined pursuant to Reviews 4, 5, 6
and 9 were affected by USDOC's application of zer oing. Since the United States has failed to rebut
Japan's prima facie case, we find that the exporter-specific margins of dumping and importer-specific
assessment rates in Reviews 4, 5, 6 and 9 were affected (in the sense of being inflated) by zeroing.

181 Appellate Body Report, US – Zeroing II (EC), para. 340.
182 Appellate Body Report, US – Zeroing II (EC), para. 341.

7.167 In support of its claim that the application of zer oing in Reviews 4, 5, 6 and 9 is inconsistent
with Articles 2.4 and 9.3 of the AD Agreement, and Article VI.2 of the GATT 1994, Japan relies inter
alia on the reasoning of the Appellate Body in the original proceeding. The United States has not
advanced any arguments to the effect that the application of zeroing in Reviews 4, 5, 6 and 9 is WTO-
consistent. We are required by Article 11 of the DSU to conduct an "objective assessment" of the
matter referred to us by Japan. In the context of an Article 21.5 proceeding, we consider it
appropriate that such "objective assessment" should take into account the findings and conclusions
resulting from the original proceeding. This is because Article 21.5 proceedings are concerned with
the implementation of recommendations and rulings based on such findings and conclusions.
7.168 In making its finding that the application of zeroing in the administrative reviews at issue in
the original proceeding is WTO-inconsistent, the Appellate Body referred to its finding that the
maintenance of the zeroing procedures as such in the context of administrative reviews was
inconsistent with Artic les 2.4 and 9.3 of the AD Agreement, and Article VI:2 of the GATT 1994.
183
The Appellate Body also referred to its prior finding in US – Zeroing (EC) that the application of
zeroing in administrative reviews is in consistent with Article 9.3 of the AD Agreement and
Article VI:2 of the GATT 1994.184 We have studied closely, and are guided by, the adopted report of
the Appellate Body in the original proceeding. Accordingly, we find that the application of zeroing in
the context of Reviews 4, 5, 6 and 9 is in consistent with Article s 2.4 and 9.3 of the AD Agreement,
and Article VI:2 of the GATT 1994.
E. THE ZEROING PROCEDURES AS SUCH
7.169 Japan submits that the United States has failed to eliminate the "zeroing procedures" as such
in the following situations: (i) in T-to-T comparis ons in original investigations; (ii) under any
comparison methodology in periodic reviews; a nd (iii) under any comparison methodology in new
shipper reviews. Japan submits that the United Stat es is therefore in violation of Articles 17.14, 21.1
and 21.3 of the DSU, in the sense that these provisions aim at achieving a satisfactory and prompt
settlement of the matter. Japan contends that the Unit ed States also continues the original violation of
Articles 2.4, 2.4.2, 9.3 and 9.5 of the AD Agreement.
7.170 The United States denies Japan's claim. The United States contends that, by virtue of
USDOC's final notice discontinuing zeroing in the context of W-to-W comparisons in original
investigations, it has eliminated the single as such measure that was subject to the DSB's
recommendations and rulings by the end of the RPT, and has therefore fully implemented the DSB's
recommendations and rulings with respect to the zeroing procedures.
(a) Main arguments of the parties
7.171 According to Japan, on 6 March 2006 (two days before the original panel circulated its
interim report), USDOC published a notice of its intention to abandon the use of the zeroing
procedures in W-to-W comparisons in original inves tigations "in light of the panel's report in US –
Zeroing [(EC)]".
185 Japan notes that the zeroing procedures at issue in US – Zeroing (EC) were found
to be WTO-inconsistent, as such, in W-to-W compar isons in original investigations, and that the
Appellate Body did not rule whether the zeroing pr ocedures were WTO-inconsistent, as such, in T-to-
T comparisons in original investigations or under any comparison methodology in periodic and new
shipper reviews. Japan asserts that on 27 Dece mber 2006, almost one month before the DSB's

183 Appellate Body Report, US – Zeroing (Japan), para. 174.
184 The Appellate Body referred in this regard to its Report in US – Zeroing (EC) , para. 133. See
Appellate Body Report, US – Zeroing (Japan), para. 174.
185 Antidumping Proceedings: Calculation of the Weighted Average Dumping Margin During an
Antidumping Duty Investigation, 71 Fed. Reg. 11189 (USDOC, 6 March 2006) (Exhibit JPN-34).

adoption of the original panel and Appellate B ody reports in the present dispute, the USDOC
published a final notice announcing that it would no longer apply the zeroing procedures in W-to-W
comparisons in original investigations.
186 According to Japan, USDOC stated that:
The Department is adopting as its final m odification its proposal that it will no longer
make average-to-average comparisons in i nvestigations without providing offsets for
non-dumped comparisons. The Department is doing so in response to the panel's
report in US - Zeroing (EC) , following the procedures set forth in section 123 of the
URAA.187
…
In its March 6, 2006 Federal Register notice, the Department proposed only that it
would no longer make average-to-average comparisons in investigations without
providing offsets for non-dumped comparisons. The Department made no proposals
with respect to any other comparison methodology or any other segment of an
antidumping proceeding, and thus declines to adopt any such modifications
concerning those other methodologies in this proceeding.188
7.172 According to Japan, therefore, the USDOC expr essly stated that it was not modifying any
aspect of its comparison methodologies for calculating dumping, other than the abandonment of
zeroing in W-to-W comparisons in original investig ations. Japan contends that the United States
therefore failed to implement the DSB's recommendati ons and rulings in this dispute with respect to
the maintenance of the zeroing procedures as such in T-to-T comparisons in original investigations,
and under any comparison methodology in periodic and new shipper reviews.
7.173 In the alternative, Japan clai ms that the United States has replaced the zeroing procedures by
a new WTO-inconsistent measure providing for the continued use of zeroing in all cases except W-to-
W comparisons in original investigations.
7.174 The United States asserts that, in the original proceeding, Japan challenged, inter alia, the
US "zeroing procedures" as being as such in consistent with various provisions of the AD Agreement
and the GATT 1994.
189 The United States argues that the original panel and the Appellate Body
agreed with Japan's argument that the zeroing procedures are "a single measure that applies to
W-to-W comparisons, T-to-T comparisons and W-to-T comparisons, used in any type of
anti-dumping proceeding."190 The United States notes the Appellate Body's conclusion that "the Panel
had sufficient evidence before it to conclude that the 'zeroing procedures' under different comparison
methodologies, and in different stages of anti- dumping proceedings, do not correspond to separate
rules or norms, but simply reflect different manifestations of a single rule or norm." 191 According to
the United States, the DSB's recommendations and ruli ngs applied exclusively to this single measure.

186 Antidumping Proceedings: Calculation of the Weighted-Average Dumping Margin During an
Antidumping Investigation; Final M odification, 71 Fed. Reg. 77722, 77723 (USDOC, 27 December 2006)
(Exhibit JPN-35).
187 Antidumping Proceedings: Calculation of the Weighted-Average Dumping Margin During an
Antidumping Investigation; Final M odification, 71 Fed. Reg. 77722, 77723 (USDOC, 27 December 2006)
(Exhibit JPN-35).
188 Antidumping Proceedings: Calculation of the Weighted-Average Dumping Margin During an
Antidumping Investigation; Final M odification, 71 Fed. Reg. 77722, 77724 (USDOC, 27 December 2006)
(emphasis added) (Exhibit JPN-35).
189 Japan, First Written Submission, 9 May 2005, para. 9.
190 Japan, Opening Statement at the Third Meeting of the Panel, 12 June 2006, para. 4; Panel Report US
– Zeroing (Japan), para. 6.19 (emphasis in original).
191 Appellate Body Report, US – Zeroing (Japan), para. 88.

The United States submits that Japan cannot have it both ways, and now treat the DSB's
recommendations and rulings as though they applied to more than one measure, by claiming that the
United States should also have eliminated the " zeroing procedures" as such in T-T comparisons in
original investigations, under any comparison methodology in periodic reviews, and under any
comparison methodology in new shipper reviews.
(b) Main arguments of the third parties
7.175 The European Communities argues that the United States has fa iled to comply with the "as
such" finding in the DSB's recommendations and ruli ngs. The European Communities contends that
the single measure, namely "zeroing procedures", w as not limited to one type of comparison in
original investigations. The single rule or norm the subject of the original proceedings was the use of
zeroing in any anti-dumping proceeding. By failing to modify the WTO-inconsistent practice in any
context apart from W-to-W comparisons in original investigations, the United States has failed to
comply with the DSB ruling by the end of the RPT and therefore is in violation of Articles 21.1, 21.3
and 17.14 of the DSU.
7.176 Korea argues that the United States has not complied with the DSB recommendations and
rulings. Korea contends that although the "zeroing procedures" as a whole may be a single rule or
norm, that does not mean that remedial action in re lation to one manifestation of that rule exonerates
the implementing Member from taking all necessary action to comply fully with the DSB
recommendations and rulings.
7.177 Mexico argues that the United States has failed to comply with the recommendations and
rulings of the DSB in relation to the Appellate Body 's "as such" findings. Mexico contends that, in
order to comply, the United States must eliminate zer oing in all four procedural settings to which the
DSB's rulings relate. Eliminating zeroing only in W- to-W comparisons in original investigations is
inadequate.
7.178 Thailand notes that the DSB made four rulings regarding the inconsistency of zeroing
procedures and argues that implementing only one of the recommendations and rulings does not
amount to implementing all four of them.
(c) Evaluation by the Panel
7.179 The Panel must determine whether or not the United States has complied with the
recommendations and rulings of the DSB regarding th e zeroing procedures as such. In order to better
understand the arguments of the parties regarding this issue, we shall briefly revisit the relevant
findings of the original panel and Appellate Body.
7.180 Before turning to the substance of Japan's as such claims, the original panel first had to
determine whether or not the zeroing procedures, which were not set forth in any written form,
constituted a measure that could be challenged as such. The original panel found that "the consistent
use of zeroing in specific cases reflects a rule or norm of general and prospective application, which
provides that non-dumped export sales are not allowed to offset margins found on dumped export
sales and which is applied regardless of the b asis upon which export price and normal value are
compared and regardless of the type of proceeding in which margins are calculated."
192 As a result,
the original panel found that the zeroing procedures could be challenged as such. On the question of
the WTO-consistency of the zeroing procedures as such, the original panel concluded that:

192 Panel Report, US – Zeroing (Japan), para. 7.53, footnotes omitted.

[b]y maintaining model zeroing procedures in the context of original investigations
USDOC acts inconsistently with Article 2.4.2 of the AD Agreement.193
7.181 The original panel rejected Japan's clai ms that the United States violated the AD Agreement
by maintaining zeroing procedures as such in T-to -T comparisons in original investigations, in
periodic reviews, and in new shipper reviews.
7.182 The United States appealed from the original panel's finding that the zeroing procedures could
be challenged as such. The United States asserted that the original panel did not have sufficient
evidentiary basis to conclude that USDOC applied zeroing in all anti-dumping proceedings, regardless
of the comparison methodology used, since the origin al panel did not have context-specific evidence
to demonstrate the existence of th e zeroing procedures in T-to-T and W-to-T comparisons in original
investigations. The United States argued before the A ppellate Body that "the existence of a rule or
norm requiring the application of zeroing must be examined separately for each comparison
methodology and for each type of anti-dumping proceeding".
194
7.183 The Appellate Body rejected the United States' appeal. In doing so, the Appellate Body
accepted "that a single rule or norm of general and prospective application that provides for
disregarding negative comparison results exists."195 The Appellate Body stated that the original panel
had not been required to establish the existence of a general rule or norm directing the use of zeroing
"through evidence of the actual application of [the zeroing] procedures in all possible situations, as
long as they were applied every time the occasion arose." 196 The Appellate Body found that, even
without evidence of the application of zeroing in T-to-T and W-to-T comparisons in original
investigations, "the Panel had sufficient evidence be fore it to conclude that the 'zeroing procedures'
under different comparison methodologies, and in different stages of anti-dumping proceedings, do
not correspond to separate rules or norms, but simply reflect different manifestations of a single rule
or norm."
197 On the question of the WTO-consistenc y of the zeroing procedures as such, the
Appellate Body upheld the aboveme ntioned substantive finding of the original panel, and concluded
in addition:
that the United States acts inconsistently with Articles 2.4 and 2.4.2 of the AD
Agreement by maintaining zeroing procedures when calculating margins of dumping
on the basis of transaction-to-transaction comparisons in original investigations;
that the United States acts inconsistently with Articles 2.4 and 9.3 of the AD
Agreement and Article VI:2 of the GATT 1994 by maintaining zeroing procedures in
periodic reviews; [and]
that the United States acts inconsistently with Articles 2.4 and 9.5 of the AD
Agreement by maintaining zeroing procedures in new shipper reviews. 198
7.184 Shortly before the adoption of the original panel and Appellate Body reports, and in the
context of a separate WTO dispute settleme nt proceeding, the USDOC announced in a
December 2006 Notice:

193 Panel Report, US – Zeroing (Japan), para. 7.258(a).
194 See Appellate Body Report, US – Zeroing (Japan), para. 87.
195 Appellate Body Report, US – Zeroing (Japan), para. 86.
196 Appellate Body Report, US – Zeroing (Japan), para. 87.
197 Appellate Body Report, US – Zeroing (Japan), para. 88.
198 Appellate Body Report, US – Zeroing (Japan) , para. 190. In making these findings, the Appellate
Body reversed the original panel's finding that the maintenance of zeroing procedures in: T-to-T comparisons in
original investigations; periodic reviews; and new shipper reviews was not WTO-inconsistent.

The Department is adopting as its final m odification its proposal that it will no longer
make average-to-average comparisons in i nvestigations without providing offsets for
non-dumped comparisons. The Department is doing so in response to the panel's
report in US - Zeroing (EC) , following the procedures set forth in section 123 of the
URAA.
199
7.185 The United States asserts that, since (by virt ue of the December 2006 Notice) it no longer
applies zeroing in W-to-W comparisons in original investigations, the zeroing procedures no longer
have universal application. According to the United States, this means that the measure at issue in the
original proceeding, whose existence was based on the universal application of zeroing in all contexts,
and when using all comparison methodologies, no longe r exists. The United States contends that it
has therefore complied with the recommendations and rulings of the DSB by withdrawing the WTO-
inconsistent measure at issue in the original proceeding.
7.186 We are unable to accept the United States' argume nt, for it confuses (1) the existence of the
zeroing procedures as a measure that can be challenge d as such, and (2) the scope of application of
that measure. In this regard, we note the Appella te Body's conclusion that "the 'zeroing procedures'
under different comparison methodologies, and in di fferent stages of anti-dumping proceedings, []
reflect different manifestations of a single rule or norm." 200 We understand this to be a reference to
the fact that, although the zeroing procedures are a single rule or norm, that single rule or norm
applies in different contexts, or "manifestations ". To the extent that the December 2006 Notice
eliminates zeroing in W-to-W comparisons in orig inal investigations, the Notice certainly addresses
one "manifestation" of the single rule or norm. However, the Notice does not address the three
remaining "manifestations" of that rule or norm wh ich were the object of findings by the Appellate
Body, namely T-to-T comparisons in original in vestigations, periodic reviews, and new shipper
reviews.
201 Thus, although the scope of application of the rule or norm has been reduced, the rule or
norm per se has not been eliminated and, as noted below, zeroing continues to be applied in contexts
other than W-to-W comparisons in original inv estigations. In order to eliminate the zeroing
procedures per se , the Notice would have had to eliminate zeroing in the context of all of the
"different manifestations". The Notice fails to do this.
7.187 Furthermore, the United States neither identified any other measure that would eliminate
zeroing in the context of the three remaining "di fferent manifestations", nor demonstrated that
USDOC has ceased to apply zeroing in any contex t other than W-to-W comparisons in original
investigations.202 By contrast, Japan has provided eviden ce that USDOC has consistently applied

199 Antidumping Proceedings: Calculation of the Weighted-Average Dumping Margin During an
Antidumping Investigation; Final M odification, 71 Fed. Reg. 77722, 77723 (USDOC, 27 December 2006)
(Exhibit JPN-35).
200 Appellate Body Report, US – Zeroing (Japan), para. 88.
201 The United States asserts that such an approach su ggests that the zeroing pr ocedures at issue in the
original proceeding consisted of at least four different measures: zeroing procedures in W-to-W comparisons in
original investigations, zeroing procedures in T-to-T co mparisons in original investigations, zeroing procedures
in any comparison methodology in administrative reviews, and zeroing procedures in any comparison
methodology in new shipper reviews (note 110 to the United States' Second Written Submission). We disagree,
since the Appellate Body clearly distinguished between (i) the existence of the single rule or norm of zeroing,
and (ii) the application, or "manifestation", of that ru le in different contexts. Although the December 2006
Notice changes the scope of application of the rule or norm, the rule or norm (i.e., the zeroing of non-dumped
export sales) persists in other contexts not addressed by the Notice.
202 United States Reply to Question 31(b) from the Panel. Although the United States contends that
"the single measure 'zeroing procedures' was not employed in any" of the investigations and reviews occurring
after the end of the RPT, the United States does not claim that it did not zero in those proceedings.

zeroing in 13 anti-dumping proceedings other than W- to-W comparisons in original determinations
since the end of the RPT.203
7.188 In light of the above, we find that the De cember 2006 Notice fails to comply with the
recommendations and rulings of the DSB:
that the United States acts inconsistently with Articles 2.4 and 2.4.2 of the AD
Agreement by maintaining zeroing procedures when calculating margins of dumping
on the basis of transaction-to-transaction comparisons in original investigations;
that the United States acts inconsistently with Articles 2.4 and 9.3 of the AD
Agreement and Article VI:2 of the GATT 1994 by maintaining zeroing procedures in
periodic reviews; [and]
that the United States acts inconsistently with Articles 2.4 and 9.5 of the AD
Agreement by maintaining zeroing procedures in new shipper reviews. 204
7.189 Accordingly, we find that the United States remain s in violation of Articles 2.4, 2.4.2, 9.3 and
9.5 of the AD Agreement, and Article VI:2 of the GATT 1994.205
7.190 We recall that Japan has also made claims under Articles 17.14, 21.1 and 21.3 of the DSU.
For the reasons cited above,206 we do not consider it necessary to consider those claims.
F. ARTICLE II OF THE GATT 1994
(a) Introduction
7.191 Japan claims that the United States has collected anti-dumping duties on ball-bearing products
in excess of the bound rates set forth in the Unite d States' Schedule of Concessions, contrary to
Articles II:1(a) and (b) of the GATT 1994. The United States contends that Japan's Article II:1 claims
are entirely derivative, and that the Panel need not address them to resolve the matter before it.
7.192 Japan's claims under Article II of the GATT 1994 concern certain liquidation actions taken by
the United States pursuant to Reviews 1, 2, 7 and 8 since the expiry of the RPT. These liquidation
actions are the means by which the United States co llects or levies its definitive anti-dumping duties.
The relevant actions are (i) liquidation instructio ns issued by USDOC and (ii) liquidation notices
issued by USCBP. USDOC's established practice is to send liquidation instructions to USCBP within
15 days of publication of the final results of antidumping administrative reviews. 207 In this way,
USDOC instructs USCBP to collect anti-dumping duti es at the rate, and from the importers, specified
therein.208 In the present case, issuance of the liqui dation instructions challenged by Japan was
delayed beyond the 15-day limit cited above, as a r esult of injunctions issued pursuant to domestic
legal proceedings brought against USDOC's dete rminations. For this reason, the liquidation
instructions challenged by Japan were not issued by USDOC until after the end of the RPT.

203 Japan, Second Written Submission, paras. 82 to 102, referring to the application of zeroing in
11 administrative reviews, one changed circumstances review, and one new shipper review.
204 Appellate Body Report, US – Zeroing (Japan), para. 190.
205 In light of this finding, there is no need for us to consider Japan's alternative claim that the zeroing
procedures have been replaced by a new WTO-inconsistent measure.
206 See para. 7.155.
207 United States, Response to Question 17 from the Panel.
208 Exhibit JPN-88.

7.193 Upon receipt of USDOC's liquidation instructions, USCBP is required to liquidate the entries,
"to the greatest extent practicable", within 90 days. To effect liquidation, the USCBP issues a notice
to importers of the amount of definitive duti es for each entry covered by the importer-specific
assessment rate. When the amount of the cash depos it paid at the time of importation equals the
amount of definitive duties due at liquidation, the importer receives only a liquidation notice from the
USCBP. When the amount of the cash deposit exceeds the amount due at liquidation, a refund cheque
accompanies the USCBP's liquidation notice. And wh en the amount of the cash deposit is less than
the amount due at liquidation, a request for payment is included with the notice. USCBP's liquidation
notices specify a cumulative amount to be liquidated, including both anti-dumping duties and ordinary
customs duties.
209
(b) Main arguments of the parties
7.194 Japan submits that, since the end of the RPT, th e United States has issued instructions and
notices for the liquidation of entries at WTO-inconsistent importer-specific assessment rates
determined in Reviews 1, 2, 7 and 8. Japan asserts that, because these importer-specific assessment
rates were found to be WTO-inconsistent in the or iginal proceeding, the United States' liquidation
actions give rise to new violations, after the end of the RPT, of the United States' obligations under
Articles II:1(a) and II:1(b) of the GATT 1994 because, at that time, the cumulative ad valorem duty
rate applied to the relevant im ports (i.e., ordinary customs duties plus anti-dumping duties) exceeds
the bound tariff that applies to the products concerned.
7.195 Japan asserts that, although Article II:2(b) of the GATT 1994 permits Members to impose
anti-dumping duties in excess of bound rates, such du ties must be "applied consistently with the
provisions of Article VI" of the GATT 1994 and, as a consequence, the AD Agreement . Japan
submits that this provision does not apply to the United States' liquidation actions at issue in this
proceeding, because Reviews 1, 2, 7 and 8 were fo und to be in violation of Article 9.3 of the AD
Agreement and Article VI:2 of the GATT 1994.
7.196 The United States contends that Japan's Article II claims are entirely derivative, and that the
Panel is not required to address them to resolve the matter before it. The United States asks the Panel
to exercise judicial economy in respect thereof. The United States also asserts that Japan failed to
request findings from the Panel under these Article II claims in its First Written Submission.
7.197 Regarding the substance of Japan's claims, th e United States notes that the liability for anti-
dumping duties, that Japan claims resulted in coll ection of duties above the bound rate, was incurred
prior to the expiry of the RPT, when the subj ect merchandise entered the United States and a cash
deposit was paid. In addition, the United States ass erts that it was no longer collecting cash deposits
pursuant to the administrative reviews that were subject to the DSB's recommendations and rulings.
According to the United States, therefore, Japan has no basis to claim that the United States, after the
RPT, collected duties in excess of the bound rates, and in a manner inconsistent with Article VI of the
GATT 1994.
(c) Evaluation by the Panel
7.198 We shall first consider whether or not Japan's Article II claims are properly within the scope
of this Article 21.5 proceeding.
210 We shall then consider the United States' arguments that there is no

209 Exhibit JPN-89.
210 The United States does not dispute that Japan's Ar ticle II claims are properly within the Panel's
terms of reference. We note in this regard that Japa n's Article II claims were speci fied at paragraph 12 of its
request for establishment (WT/DS322/27), which refers to "United States Government instructions and notices

need for the Panel to address Japan's Article II claims. Thereafter, we turn to the substance of Japan's
Article II claims.
(i) Are Japan's claims properly within the scope of this Article 21.5 proceeding?
7.199 As noted above, the jurisdiction of a panel established under Article 21.5 of the DSU is
limited to "measures taken to comply" with the recommendations and rulings of the DSB. Although
the United States has not challenged Japan's inclusi on of the relevant liquidation measures in these
proceedings, we are entitled to consider on our own initiative, as a preliminary jurisdictional matter,211
whether or not such liquidation measures are properly within the scope of these proceedings by virtue
of being "measures taken to comply" in the meaning of Article 21.5 of the DSU.
7.200 In our view, the relevant liquidation measures are sufficiently closely connected to the
original dispute, such that they should be treated as "measures taken to comply" with the
recommendations and rulings resulting from that dis pute. This is because the relevant liquidation
measures are the means by which the United States collects the final anti-dumping duties assessed in
the administrative reviews at issue in the origin al proceeding. Any WTO-inconsistency in those
administrative reviews regarding the calculation of the margin of dumping established in the original
dispute is necessarily carried over into the subse quent liquidation measures. For these reasons, (and
in the absence of any claims by the United States to the contrary) we find that the liquidation
measures challenged by Japan are "measures taken to comply" within the meaning of Article 21.5 of
the DSU.
(ii) The United States' arguments that there is no need to address Japan's Article II claims
7.201 The United States asserts that Japan's Article II claims are "entirely derivative"212 of its claims
that the United States violated Articles 2.4 and 9.3 of the AD Agreement , and Article VI:2 of the
GATT 1994, by failing to implement the recommendati ons and rulings of the DSB in respect of the
importer-specific assessment rates.
7.202 While we accept Japan's argument that its Article II claims relate to different measures than
its Article 2.4 and 9.3 claims, we nevertheless note th at the alleged violation of Article II is dependent
on a finding that the underlying administrative review is WTO-inconsistent. Only if the underlying
anti-dumping measure is WTO-inconsistent will the safe harbour provided for in Article II:2(b)
become unavailable.213 Accordingly, we agree with the United States that Japan's Article II claims are
derivative of its claims under Articles 2.4 and 9.3 of the AD Agreement.214

... to liquidate entries". Nor does the United States deny that the relevant liquidation actions are measures that
may be challenged in WTO dispute settlement proceedings.
211 We are guided in this regard by the Appellate Body's statement that "it is a widely accepted rule that
an international tribunal is entitled to consider the i ssue of its own jurisdiction on its own initiative, and to
satisfy itself that it has jurisdiction in any case that comes before it" (see Appellate Body Report, US – 1916 Act,
note 30).
212 United States, First Written Submission, note 116.
214 We also note the United States' argument that Japan failed to request any Article II findings in its
First Written Submission. Although it is true that Japan did not ask the Panel to make findings under Article II
of the GATT 1994 in the conclusory section at paragr aph 159 of its First Written Submission, there is no
provision in the DSU or the WTO Agreement requiring it to do so. Although Japan might have argued its
Article II claims more fully in its First Written Submissi on, the basic essence of those claims was clearly stated
in note 142 of that submission. Japan's Article II clai ms were subsequently developed more fully in its later
submissions to the Panel.

7.203 Nevertheless, we consider that Japan's Article II claims raise an important point of contention
between the parties regarding the right of the Unite d States to continue liquidating entries after the
expiry of the RPT on the basis of liquidation measur es issued pursuant to administrative reviews that
have already been found to be WTO-inconsistent. We consider it important that the United States'
obligations under Articles II:1(a) and II:1(b) should be properly determined in this context. For this
reason, we consider it appropriate to rule on Japan 's Article II claims, in order to resolve this
particular dispute between the parties. Accordingly, we decline the United States' request to exercise
judicial economy in respect of Japan's Article II claims.
(iii) The substance of Japan's Article II claims
7.204 Turning to the substance of Japan's claims, we note that Articles II.1(a) and (b), and
Article II.2(b) of the GATT 1994 provide:
1. ( a) Each contracting party shall acco rd to the commerce of the other
contracting parties treatment no less favourable than that provided for in the
appropriate Part of the appropriate Schedule annexed to this Agreement.
 ( b) The products described in Part I of the Schedule relating to any
contracting party, which are the products of territories of other contracting parties,
shall, on their importation into the territory to which the Schedule relates, and subject
to the terms, conditions or qualifications set forth in that Schedule, be exempt from
ordinary customs duties in excess of those set forth and provided therein. Such
products shall also be exempt from all other duties or charges of any kind imposed on
or in connection with the importation in ex cess of those imposed on the date of this
Agreement or those directly and mandator ily required to be imposed thereafter by
legislation in force in the importing territory on that date.
2. Nothing in this Article shall preven t any contracting party from imposing at
any time on the importation of any product:
 ( b) any anti-dumping or countervaili ng duty applied consistently with
the provisions of Article VI.
7.205 According to these provisions, the United States is generally precluded from imposing on
imports of ball bearings from Japan any customs du ties or other charges in excess of those provided
for in the United States Schedule of Concessions. Although the United States may normally levy anti-
dumping duties in excess of such bound rates, Article II:2(b) provides that it may only do so if those
duties are "applied consistently with the provisions of Article VI" of the GATT 1994, as implemented
by the AD Agreement.
7.206 Japan has submitted evidence demonstrating that the cumulative liquidation amounts set forth
in a series of USCBP liquidation notices,
215 issued pursuant to particular USDOC liquidation
instructions,216 are well in excess of the bound rates for ball-bearing products set forth in the
United States' Schedule of Concessions. This eviden ce, which is summarized in Exhibit JPN-90, has
not been challenged by the United States.
7.207 To the extent that such excess is attributable to anti-dumping duties applied consistently with
the provisions of Article VI of the GATT 1994, such excess would not constitute a violation of
Articles II:1(a) and (b). This is because of the safe harbour provided for in Article II:2(b) of the

215 The relevant liquidation notices are set forth in Exhibits JPN-81 to JPN-87.
216 The relevant liquidation instructions are set forth in Exhibits JPN-40.A, and JPN-77 to JPN-80.

GATT 1994, which allows the imposition of anti-dumpi ng duties in excess of the bound rate set forth
in the Schedule of Concessions. In the presen t case, though, the safe harbour provided for in
Article II:2(b) does not apply to the liquidation actions at issue in th is proceeding, since those actions
were taken pursuant to administrative reviews, and importer-specific assessment rates determined
therein, that had been found to be WTO-inconsistent in the original proceeding. In particular, the
Appellate Body found that, in determini ng importer-specific assessment rates in inter alia Reviews 1,
2, 7 and 8, USDOC disregarded the results of co mparisons for transactions where the export price
exceeded the contemporaneous normal value, in violation of Article 2.4 and 9.3 of the AD Agreement,
and Article VI:2 of the GATT 1994. 217 We recall that, in cases where administrative reviews are
conducted, the liquidation notices and instructions ar e based entirely on the determinations made by
USDOC in such reviews. Since the underlying b asis of the liquidation actions challenged by Japan
was WTO-inconsistent, we conclude that anti-dumping duties collected 218 pursuant to those
liquidation actions were not "appl ied consistently with the provisions of Article VI" of the
GATT 1994, as implemented by the AD Agreement.219
7.208 For the above reasons, we find that the USDOC li quidation instructions set forth in Exhibits
JPN-40.A, and JPN-77 to JPN-80, and the USCBP liquidation notices set forth in Exhibits JPN-81 to
JPN-87, are in violation of Articles II:1(a) and (b) of the GATT 1994. 220
G. SUNSET REVIEW DETERMINATION OF 4 NOVEMBER 1999
(a) Main arguments of the parties
7.209 Japan challenges the United States' omission to take any action to implement the
recommendations and rulings of the DSB with resp ect to the sunset review determination of
4 November 1999 ("the 1999 sunset review"), wh ich was found to be WTO-inconsistent by the
Appellate Body in the original proceedings. Japan claims that the omission constitutes a violation of
Articles 17.14, 21.1 and 21.3 of the DSU and a continued violation of Article 11.3 of the AD
Agreement. Japan argues that because the 1999 sunset review is WTO-inconsistent, the United States'
imposition of anti-dumping duties on ball bearings has been bereft of legal basis since
4 November 1999. Japan notes that the United Stat es has failed, despite a Japanese invitation, to
make any statement at DSB meetings regarding the st atus of its implementation action with respect to
the 1999 sunset review.
7.210 Although the United States argues that it was not necessary to modify the results of the 1999
sunset review because an independent WTO-consis tent basis for the likelihood of continued dumping

217 Appellate Body Report, US – Zeroing (Japan), paras. 175 and 176.
218 According to the United States, "[l]iquidation is the ministerial act whereby CBP finally collects the
antidumping duties" (US response to Question 14 from the Panel, at para. 27). The abovementioned liquidation
actions, therefore, involved the collection of anti-dumping duties.
219 We recall the United States' arguments that the liability for anti-dumping duties challenged by Japan
was incurred prior to the expiry of the RPT, and that the United States was no longer collecting cash deposits
pursuant to the administrative reviews that were subject to the DSB's recommendations and rulings after the end
of the RPT. We have already explained that the Un ited States' implementation obligations apply to actions
taken after the expiry of the RPT, even if those actions re late to import entries that occurred at an earlier date.
Furthermore, the liquidation actions challenged by Japan are new measures, separate from the cash deposits
applied at the time of import entry. The fact that th e United States no longer collects those cash deposit rates
therefore has no bearing on Japan's Article II claims regarding those new measures. Accordingly, the
United States' arguments do not cause us to change our finding under Article II of the GATT 1994.
220 We note that our approach differs from that adopted by the panel in US – Zeroing (EC) (21.5 – EC),
which found that "the relevant date for implementation of DSB recommendations and rulings concerning anti-
dumping duties by a Member operating a retrospective duty assessment system is the date of the final
determination of liability" (para. 8.174).

exists, Japan contends that this argument is basel ess. In particular, Japan notes that the Appellate
Body found the 1999 sunset review inconsistent with Article 11.3 of the AD Agreement. Since the
Appellate Body made that finding, the 1999 sunset review has not been changed in any way and nor
have any of the facts underlying it. Accordin g to Japan, the United States is presenting new
arguments, based on old facts, to seek a reassessmen t of the Appellate Body's conclusion regarding
the 1999 sunset review. Japan argues that this is not possible because, absent a change in facts, the
Appellate Body's determination represents a "final resolution" to the dispute.
221 Japan relies on the
Appellate Body's decision in US – OCTG from Argentina (21.5 - Argentina)222 as coming to a "similar
finding".223
7.211 According to Japan, the Panel need go no furthe r than conclude that the United States has
taken no implementation action to bring the 1999 sunset review into conformity with Article 11.3 of
the AD Agreement. Nevertheless, Japan also addresses the United States' arguments that the 1999
sunset review is WTO-consistent, despite the Appella te Body's ruling to the contrary. In particular,
Japan notes that the United States has not substantia ted its assertion that the majority of dumping
margins relied on in the 1999 sunset review dete rmination were WTO-consistent. The evidence
provided concerns only ten out of 21 margins cal culated in the 1996 periodic review, which is only
one of nine periodic reviews covered by the 1999 sun set review determination. Further, Japan notes
that the United States' ex post facto rationalization does not meet the standard set for sunset reviews
by the Appellate Body in the original dispute, namely, as requiring "rigorous examination" and
"reasoned and adequate conclusions".224
7.212 Japan argues that the ten adverse facts margins relied upon by the United States to support the
WTO-consistency of the 1999 sunset review do not provide "positive evidence" for an order-wide
determination that dumping is likely to recur or con tinue. This is because the basis for the margins is
the petitioners' allegations of dumping, rather th an a comprehensive investigation verifying the
accuracy of such allegations. Japan also questions whether the ten margins in issue were calculated
consistently with WTO requirements, detailed in Annex II(7) of the AD Agreement, regarding the use
of facts available. In particular, Japan alle ges that the United States did not use "special
circumspection" in relying on the facts available.
7.213 Finally, Japan dismisses as misguided the United States' argument that an authority may rely
on margins of dumping determined, using zeroing, before the AD Agreement entered into force.
Japan alleges that at the time an authority makes a determination under Article 11.3 of the AD
Agreement, it must have reliable evidence regarding the likelihood of "dumping", as that term is
understood in the AD Agreement. Evidence drawn from a determination based on a different
understanding of the term is not pertinent becau se it does not give any indication of "dumping"
according to the standard under Article 11.3 of the AD Agreement.
7.214 The United States asserts that it has complied with the DSB recommendations and rulings in
relation to the 1999 sunset review. The Appe llate Body found that the United States acted
inconsistently with the AD Agreement in the 1999 sunset review "when it relied on margins of
dumping calculated in previous proceedings through the use of zeroing". 225 Therefore, the
United States contends that, apart from the exte nt to which it relied on margins calculated using
zeroing, the Appellate Body found no WTO-inconsistency with the 1999 sunset review.

222 Appellate Body Report, US – OCTG from Argentina (21.5 - Argentina).
223 Japan, Opening Statement at Meeting with the Panel, para. 115.
224 Japan, Opening Statement at Meeting with the Panel, paras. 118-119.
225 United States, First Written Submission, para. 74.

7.215 The United States asserts that the 1999 sunset re view determination does not rest exclusively
upon margins that the Appellate Body found inconsistent with Article 11.3 of the AD Agreement. In
fact, the majority of margins are WTO-cons istent, either because they predate the AD Agreement or
do not involve the use of zeroing. Such margin s independently support the conclusion that USDOC
reached, namely that dump ing continued at above de minimis levels after the imposition of the anti-
dumping duty order. To support this contention, the United States notes that in the fifth
administrative review, which covered part of th e relevant sunset review period, twenty-one
respondents were reviewed, eleven of which faile d to cooperate. For te n of these non-cooperating
respondents, USDOC applied a dumping margin based upon a petition rate that used actual pricing
data and was calculated without zeroing. In respon se to a Panel question, the United States notes that
the first and second administrative reviews also cont ain margins calculated without zeroing. Further,
the United States rejects Japan's argument that a Member cannot rely on margins, calculated using
zeroing, that pre-date the AD Agreement. The United States concludes that "because an independent
WTO-consistent basis for the likelihood of the continuance of dumping…exists, it was unnecessary to
modify the final results of the challenged sunset review". 226 The United States relies on the Appellate
Body's decision in US – Corrosion Resistant Steel Sunset Review 227 to support its contention that it
can rely on previously calculated dumping margins that were not challenged by Japan, to support the
validity of the 1999 sunset review.
7.216 In response to Japan's argument that the Appella te Body's decision in the original dispute
must be treated as a "final resolution", the United States contends that it is not seeking a new finding
with respect to that part of the sunset review on which the DSB made recommendations and rulings.
Rather, the United States argues that the Appellate Body's findings in this dispute do not prohibit the
United States from relying in these Article 21.5 pr oceedings on margins calculated without zeroing to
justify the 1999 sunset reviews as originally found to be WTO-inconsistent. Contrary to Japan's
argument that the United States should have presen ted the arguments defending its reliance on non-
zeroed margins and pre-WTO margins in the original proceeding, the United States asserts that it was
not required to present arguments in the original proceedings regarding its reliance on these WTO-
consistent margins because they were not challenged by Japan.
7.217 The United States notes that the requirement either to withdraw or revise a WTO-inconsistent
measure applies when there is only a single basi s to support a measure and it is found to be
inconsistent with a covered agreement. In the present case, there were other bases for the validity of
the measure than that ruled upon by the Appellate Body in the original proceedings. Therefore, it is
unnecessary for the United States to withdraw or modify the 1999 sunset review.
(b) Main arguments of the third parties
7.218 The European Communities argues that the United States has not changed any aspect of the
1999 sunset review, which was found to be WTO-in consistent and is disregarding the specific
findings of the DSB. Therefore, the original violation of Article 11.3 of the AD Agreement continues.
According to the European Commun ities, the United States was required, as a minimum, to carry out
a new determination of the likelihood of the recurrence of dumping.
7.219 With respect to the argument that there were other bases to support the validity of the 1999
sunset review, the European Communities contends that the United States is attempting to reopen a
factual issue that has already been ruled upon in th e original proceedings. Further, the European
Communities questions whether the United States has made a prima facie case that there were
margins of dumping calculated without zeroing on whic h it relied to maintain the 1999 sunset review
determination. In particular, the United Stat es has not provided evidence to demonstrate that all the

226 United States, First Written Submission, para. 75.
227 Appellate Body, US – Corrosion Resistant Steel Sunset Review.

comparisons between normal values and export prices with respect to all the dumping margins relied
upon by USDOC in the 1999 sunset review resulted in positive results of "dumping". In any event,
the European Communities asserts th at the argument that there is a WTO-consistent basis for the
validity of the 1999 sunset review should be rej ected because the United States should not have a
second chance to defend a measure that the Appe llate Body has already found to be WTO-
inconsistent.
7.220 Korea argues that the United States does not expl ain why or how it was able to reach the
same finding regarding the likelihood of dumping in relation to the 1999 sunset review. Further,
Korea notes that in conducting a sunset review, the ma rgins and results of the original investigations
and administrative reviews are key factors relied upon by USDOC. The sunset reviews cannot be
separated from previous anti-dumping proceedings. Korea argues that because the United States
continues to use zeroing in the orig inal investigations and the periodi c reviews, the subsequent sunset
reviews are tainted. Therefore, the United States ha s failed to implement the decisions of the DSB in
relation to the 1999 sunset review.
7.221 Norway argues that a mere statement by the United States that it would have come to the
same conclusion under the 1999 sunset review whethe r or not zeroing was used is not sufficient to
demonstrate compliance. Rather, the United States is required to show, with correctly calculated
dumping margins, that it would have reached the sa me likelihood determination. Further, only the
correctly calculated margins could then be used to set anti-dumping rates for the future. Norway
contends that in order to comply with the DSB recommendations and rulings, the United States should
have conducted a Section 129 review of the 1999 sunset review, including recalculating all margins
determined using zeroing and presenting fresh inform ation that could credibly support a likelihood
determination. The omission of the United States to do anything at all indicates that it remains in
violation of Article 11.3 of the AD Agreement.
(c) Evaluation by the Panel
7.222 Article 11.3 of the AD Agreement provides, relevantly:
…any definitive anti-dumping duty shall be te rminated on a date not later than five
years from its imposition…unless the authorities determine…that the expiry of that
duty would lead to a continuance or a recurrence of dumping and injury.
7.223 In the original proceedings, the Appellate Body concluded:
As the likelihood-of-dumping dete rminations in the sunset reviews at issue in this
appeal relied on margins of dumping calculated inconsistently with the Anti-Dumping
Agreement, they are inconsistent with Article 11.3 of that Agreement.
 228
This was accompanied by a recommendation from the DS B, pursuant to Article 19.1 of the DSU, that
the United States bring the inconsistent measures into conformity with the AD Agreement. The
Appellate Body's finding of WTO-inconsistency in the original proceedings of this case is addressed
to USDOC's likelihood of dumping determination. Therefore, in order to implement the
recommendations and rulings of the DSB, the Unite d States was required to bring the likelihood of
dumping determination into conformity with Article 11.3 of the AD Agreement.
7.224 We have already explained that, in order to implement the recommendations and ruling of the
DSB, the United States was required to withdraw, modify or replace the 1999 sunset review, to the
extent it had not already expired.
229

228 Appellate Body Report, United States – Zeroing (Japan), para. 185.

7.225 However, by its own admission, the United St ates has neither withdrawn nor revised the
likelihood of dumping determination. The United St ates contends that it was "unnecessary to modify
the final results of the challenged sunset review " because an independent WTO-consistent basis for
the likelihood of continuance of dumping determination in the 1999 sunset review exists. 230
7.226 It is possible to interpret the United States' submissions as suggesting that USDOC did make
a new determination, without using zeroed margins, regarding the likelihood of dumping and came to
same conclusion as under the 1999 sunset review. For example, in its closing statement at the
substantive meeting of the Panel, the United States noted that:
Because Japanese respondents continued to dump, even when the antidumping duties
were in effect, Commerce made a reasone d and adequate conclusion that dumping
would continue if the antidumping order was revoked.
 231
Further, in response to a Panel question, the Unite d States argued that the allegedly WTO-consistent
margins demonstrate continued dumping after the imposition of the anti-dumping duties and
"accordingly, it was apparent that is was unnecessary to change th e November 4, 1999 likelihood of
dumping determination". 232 Both of these submissions suggest that a fresh consideration of the
likelihood of dumping was c onducted. However, despite being pr essed at the substantive meeting of
the Panel and through written questions to provide details and a copy of any new determination
reached by USDOC, the United States provides no evidence regarding any such new determination.233
7.227 Therefore, there is nothing upon which the Pa nel can conclude that the United States has
withdrawn or revised the likelihood of dumpi ng determinations in the 1999 sunset review . In the
absence of such evidence, the determinations remain unchanged and therefore, we must confirm their
inconsistency with Article 11.3 of the AD Agreement.234
7.228 Having reached this conclusion, there is no need for the Panel to determine whether certain of
the margins relied upon in the 1999 sunset review were WTO-consistent. We do not disagree with the
United States' argument that United States – Corrosion-Resistant Steel Sunset Review supports the
notion that it can rely on previously calculated dump ing margins that were not challenged by Japan in
the original proceedings. However, the previously calculated margins can be relied upon only in the
context of a new determination. United States – Corrosion-Resistant Steel Sunset Review does not

229 See para. 7.141. A similar finding was made in United States – OCTG from Argentina. In the
corresponding compliance proceedings, the Appellate Body held:
The original panel concluded that 'the USDOC's like lihood determination in the instant sunset review
was inconsistent with Article 11.3 of the Anti-Dumping Agreement'. It is evident from this language that the
original panel's finding of WTO-inconsistency is addressed to the USDOC's likelihood-of-dumping
determination. Therefore, to comply with the original panel's finding, as adopted by the DSB, the United States
had to bring its determination of likelihood of dumping into conformity with Article 11.3 of the Anti-Dumping
Agreement. (Appellate Body Report, United States – OCTG from Argentina (21.5 - Argentina), para. 143.)
230 United States, First Written Submission, para. 75.
231 United States, Closing Statement at Meeting with the Panel, para. 13.
232 United States, Response to Panel Question 28, para. 45 (emphasis added).
233 The Panel asked the United States to provide information, including documentation, pertaining to
the "conclusion" referred to in para. 13 of the United States' closing statement (Question 28 from the Panel to
the Parties in Connection with the Substantive Meeting of the Panel, 7 November 2008). The United States
replied that "the term 'conclusion' ... refers to the conclusion regarding the lik elihood of dumping in the
4 November 1999 sunset determination" (United States, Response to Panel Questions, para. 43).
234 The United States asserts that the WTO-consistent and inconsistent margins each independently
support the conclusion reached in the 1999 sunset review. However, in the absence of a reasoned determination
from USDOC, there is nothing upon which we are able to conclude that the United States is now relying solely
on the allegedly WTO-consistent margins and is no longer relying on the margins determined using zeroing.

require the Panel to accept a simple assertion that the 1999 sunset review may be justified on the basis
of previously calculated margins.
7.229 Therefore, we conclude that the United States has failed to comply with the DSB
recommendations and rulings with respect to the 1999 sunset review, and that the violation of
Article 11.3 of the AD Agreement continues. For the reasons set forth at para. 7.155 above, we
decline to consider Japan's claims in relation to Articles 21.1, 21.3 and 17.14 of the DSU.
VIII. CONCLUSIONS AND RECOMMENDATIONS
8.1 In accordance with our mandate under Article 21.5 of the DSU, we have examined the
existence or consistency with cove red agreements of measures taken by the United States to comply
with recommendations and rulings adopted by the DSB in the original proceeding. In the light of our
reasoning above:
(a) We find that the United States has failed to comply with the DSB's recommendations
and rulings regarding the importer-specific assessment rates determined in Reviews 1,
2, 3, 7 and 8 that apply to entries cove red by those Reviews that were, or will be,
liquidated after the expiry of the RPT.
(i) Accordingly, we find that the United States is in continued violation of its
obligations under Articles 2.4 and 9.3 of the AD Agreement and Article VI:2
of the GATT 1994.
(ii) We decline to rule on Japan's claim that this failure to comply is inconsistent
with the United States' obligations unde r Articles 17.14, 21.1 and 21.3 of the
DSU.
(b) We find that the United States has acted inc onsistently with Articles 2.4 and 9.3 of
the AD Agreement and Article VI:2 of the GATT 1994 by applying zeroing in the
context of Reviews 4, 5, 6 and 9.
(c) We find that the United States has failed to comply with the recommendations and
rulings of the DSB regarding the United St ates' maintenance of zeroing procedures
challenged "as such" in the or iginal proceedings. In particular, we find that the
United States has failed to implement the DSB's recommendations and rulings in the
context of T-to-T comparisons in original investigations and under any comparison
methodology in periodic and new shipper reviews.
(i) Accordingly, we find that the United States remains in violation of
Articles 2.4, 2.4.2, 9.3 and 9.5 of the AD Agreement and Article VI:2 of the
GATT 1994.
(ii) We decline to rule on Japan's claim that this failure to comply is inconsistent
with the United States' obligations unde r Articles 17.14, 21.1 and 21.3 of the
DSU.
(d) We find that the United States is in violation of Articles II:1(a) and II:1(b) of the
GATT 1994 with respect to certain liquidation actions taken after the expiry of the
RPT, namely with respect to the USDOC liqui dation instructions set forth in Exhibits
JPN-40A and JPN-77 to JPN-80 and the USCBP liquidation notices set forth in
Exhibits JPN-81 to JPN-87.

(e) We find that the United States has failed to comply with the DSB's recommendations
and rulings with respect to the 1999 sunset review.
(i) Accordingly, we find that the United States remains in violation of
Article 11.3 of the AD Agreement.
(ii) We decline to rule on Japan's claim that this failure to implement is
inconsistent with the United States' obligations under Articles 17.14, 21.1
and 21.3 of the DSU.
8.2 To the extent that the United States has fail ed to comply with the recommendations and
rulings of the DSB in the original dispute, the recommendations and rulings remain operative. We
also recommend that the DSB request the United St ates to bring Reviews 4, 5, 6 and 9, and the
liquidation actions referred to in para. 7. 1(d) above, into conformity with the AD Agreement and the
GATT 1994.