EUROPEAN COMMUNITIES – DEFINITIVE ANTI-DUMPING MEASURES ON CERTAIN IRON OR STEEL FASTENERS FROM CHINA
Document: Report of the Appellate Body
Date: 15 July 2011
Document codes: WT/DS397/AB/R
Complainant: China
Respondent: EU
Third parties: Brazil, Canada, Chile, Colombia, India, Japan, Norway, Taiwan, Thailand, Turkey, U.S.
Dispute stage: Implementation & Compliance
Agreements cited: Art. 6, 9, 5, 2, 3, 4  Anti-dumpingArt. I, X:3(a), VI:1  GATT 1994Art. XVI:4  Agreement Establishing the World Trade Organization

EUROPEAN COMMUNITIES – DEFINITIVE ANTI-DUMPING MEASURES
ON CERTAIN IRON OR STEEL FASTENERS FROM CHINA

AB-2011-2

Report of the Appellate Body

APPELLATE BODY

European Communities1 – Definitive
Anti-Dumping Measures on Certain Iron or
Steel Fasteners from China

European Union, Appellant/Appellee
China, Appellee/Other Appellant

Brazil, Third Participant
Canada, Third Participant
Chile, Third Participant
Colombia, Third Participant
India, Third Participant
Japan, Third Participant
Norway, Third Participant
Separate Customs Territory of Taiwan, Penghu,
 Kinmen and Matsu, Third Participant
Thailand, Third Participant
Turkey, Third Participant
United States, Third Participant

 AB-2011-2

 Present:

 Oshima, Presiding Member
 Hillman, Member
 Unterhalter, Member

I. Introduction
1. The European Union and China each appeals certa in issues of law and legal interpretations
developed in the Panel Report, (the "Panel Report").
2 The Panel was established on
23 October 2009 to consider a complaint by Ch ina concerning the consistency "as such" of
Article 9(5) of Council Regulation (EC) No. 384/96 of 22 December 1995, as amended, on protection

1This dispute began before the entry into force of the Treaty of Lisbon amending the Treaty on
European Union and the Treaty establishing the European Community (done at Lisbon, 13 December 2007) on
1 December 2009. On 29 November 2009, the received a Verbal Note (WT/L/779)
from the Council of the European Union and the Commission of the European Communities stating that, by
virtue of the Treaty of Lisbon , as of 1 December 2009, the "Europe an Union" replaces and succeeds the
"European Community". On 13 July 2010, the World Trade Organizati on received a second Verbal Note
(WT/Let/679) from the Council of the European Union confirming that, with effect from 1 December 2009, the
European Union replaced the European Community and assumed all the rights and obligations of the European
Community in respect of all Agreements for which the Di rector-General of the World Trade Organization is the
depositary and to which the European Community is a si gnatory or a contracting party. We understand the
reference in the Verbal Notes to the "European Communi ty" to be a reference to the "European Communities".
The European Union requested that the Panel replace "European Communities" with "European Union" in the
title of the case, but the Panel decided not to make this change because China's request for consultations and for
the establishment of a panel both occurred prior to 1 December 2009 and referred to the European Communities,
as did the decision of the DSB establis hing the Panel. However, all the submissions of the parties before the
Panel came after that date and referred to the European Union, and the Panel made its findings with reference to
the European Union. (Panel Report, paras. 6.4 and 6.5) In this Report, we too refer to the European Union.
2WT/DS397/R, 3 December 2010.

against dumped imports from countries not members of the European Community
3 with the
Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (the
"Anti-Dumping Agreement"), the General Agreement on Tariffs and Trade 1994 (the "GATT 1994"),
and the Marrakesh Agreement Establishi ng the World Trade Organization (the " WTO Agreement"),
and the consistency of this measure, "as applied" in the fasteners investigation, with the Anti-Dumping
Agreement; and the consistency of Council Regula tion (EC) No. 91/2009 of 26 January 2009
imposing a definitive anti-dumping duty on imports of cer tain iron or steel fasteners originating in the
People's Republic of China (the "Definitive Regulation") 4 with the Anti-Dumping Agreement .
Council Regulation (EC) No. 384/96 was subsequently repealed and replaced by Council Regulation
(EC) No. 1225/2009 of 30 November 2009, and Ch ina's submissions to the Panel addressed Council
Regulation (EC) No. 1225/2009 (the "Basic AD Regulation").5
2. Before the Panel, China challenged the cons istency of Article 9(5) of the Basic AD
Regulation, "as such", with Articles 6.10, 9.2, 9.3, 9.4, and 18.4 of the Anti-Dumping Agreement ,
Articles I:1 and X:3(a) of the GA TT 1994, and Article XVI:4 of the WTO Agreement because it
requires exporters from non-market economies to satisfy certain criteria in order to receive individual
dumping margins and individual duty rates. China also challenged Article 9(5) of the Basic AD
Regulation, "as applied" in the fasteners investigation, under Articles 6.10, 9.2, and 9.4 of the
Anti-Dumping Agreement. Additionally, China challenged various substantive and procedural aspects
of the Definitive Regulation, imposing anti-dumpi ng duties in the fasteners investigation, under
Articles 2, 3, 4, 5, 6, and 12 of the Anti-Dumping Agreement . These included the Commission's
determinations regarding standi ng, the definition of the domestic industry, the product under
consideration, dumping and price undercutting, volume and impact of dumped imports, and causation.
Procedurally, China's challenges dealt with the di sclosure by the Commission of information relevant
to the investigation, the treatment of confidential information, and the procedural aspects of individual
treatment claims.
3. The Panel Report was circulated to Members of the World Trade Organization (the "WTO")
on 3 December 2010. For the reasons set out in its Report, the Panel made the following findings.

3Official Journal of the European Communities , L Series, No. 56 (6 March 1996) 2 (Panel Exhibit
CHN-1).
4Official Journal of the European Union, L Series, No. 29 (31 January 2009) 1 (Panel Exhibit CHN-4).
5Official Journal of the European Union, L Series, No. 343 (22 December 2009) 51, and Corrigendum,
Official Journal of the European Union, L Series, No. 7 (12 January 2010) 23 (Panel Exhibit CHN-3).

The Panel found that the following claims were not within its terms of reference:
(a) the claim under Article 2.6 of the Anti-Dumping Agreement with respect to the
definition of like product;
(b) the claim under Article 6.9 of the Anti-Dumping Agreement with respect to the
alleged non-disclosure of aspects of the normal value determination; and
(c) the claim under Article 6.9 of the Anti-Dumping Agreement with respect to the
procedural aspects of the domestic industry definition.
 The Panel found that the European Union acted inconsistently with:
(a) Articles 6.10, 9.2, and 18.4 of the Anti-Dumping Agreement , Article I:1 of the
GATT 1994, and Article XVI:4 of the WTO Agreement with respect to Article 9(5) of
the Basic AD Regulation;
(b) Articles 6.10 and 9.2 of the Anti-Dumping Agreement with respect to the individual
treatment determinations in the fasteners investigation;
(c) Articles 3.1 and 3.2 of the Anti-Dumping Agreement with respect to the volume of
dumped imports considered in the fasteners investigation;
(d) Articles 3.1 and 3.5 of the Anti-Dumping Agreement with respect to the causation
analysis in the fasteners investigation;
(e) Articles 6.4 and 6.2 of the Anti-Dumping Agreement with respect to certain aspects of
the normal value determination;
(f) Article 6.5.1 of the Anti-Dumping Agreement with respect to non-confidential
versions of questionnaire responses of two Eu ropean producers and Article 6.5 of the
Anti-Dumping Agreement with respect to confidential treatment of information in the
questionnaire response of the Indian producer;
(g) Article 6.5 of the Anti-Dumping Agreement with respect to the confidential treatment
of the Eurostat data on total EU production of fasteners; and
(h) Article 6.5 of the Anti-Dumping Agreement by disclosing confidential information.
 The Panel found that China had not establis hed that the European Union had acted
inconsistently with:
(a) Article 5.4 of the Anti-Dumping Agreement with respect to the standing determination
in the fasteners investigation;
(b) Articles 4.1 and 3.1 of the Anti-Dumping Agreement with respect to the definition of
domestic industry in the fasteners investigation;
(c) Articles 2.1 and 2.6 of the Anti-Dumping Agreement with respect to the product under
consideration in the fasteners investigation;

(d) Article 2.4 of the Anti-Dumping Agreement with respect to the dumping
determination in the fasteners investigation;
(e) Articles 3.1 and 3.2 of the Anti-Dumping Agreement with respect to the price
undercutting determination in the fasteners investigation;
(f) Articles 3.1, 3.2, 3.4, and 3.5 of the Anti-Dumping Agreement with respect to the
consideration of imports from non-sample d/unexamined producers and exporters as
dumped in the fasteners investigation;
(g) Articles 3.1 and 3.4 of the Anti-Dumping Agreement with respect to the consideration
of the consequent impact of dumped imports on the domestic industry;
(h) Articles 6.5, 6.4, and 6.2 of the Anti-Dumping Agreement in connection with the
non-disclosure of the identity of the complainants and the supporters of the
complaint;
(i) Articles 6.2 and 6.4 of the Anti-Dumping Agreement with respect to the confidential
treatment of the Eurostat data on total EU production of fasteners;
(j) Articles 6.2 and 6.4 of the Anti-Dumping Agreement with respect to the procedural
aspects of the domestic industry definition; and
(k) Article 6.1.1 of the Anti-Dumping Agreement with respect to the amount of time
provided for responses to requests for information.
 The Panel exercised judicial economy with regard to the following claims:
(a) Articles 9.3 and 9.4 of the Anti-Dumping Agreement and Article X:3(a) of the
GATT 1994 with respect to Article 9(5) of the Basic AD Regulation;
(b) Article 9.4 of the Anti-Dumping Agreement with respect to the individual treatment
determinations in the fasteners investigation;
(c) Articles 3.4 and 3.5 of the Anti-Dumping Agreement with respect to the volume of
dumped imports considered in the fasteners investigation;
(d) Article 6.5.1 of the Anti-Dumping Agreement with respect to the questionnaire
response of the Indian producer;
(e) Articles 6.2 and 6.4 of the Anti-Dumping Agreement with respect to the
non-confidential versions of questionnaire responses of two European producers and
the confidential treatment of information in the questionnaire response of the Indian
producer; and
(f) Article 12.2.2 of the Anti-Dumping Agreement with respect to the procedural aspects
of the individual treatment determinations.
4. On 25 March 2011, the European Union notified th e Dispute Settlement Body (the "DSB") of
its intention to appeal certain issues of la w covered in the Panel Report and certain legal
interpretations developed by the Panel, pursuant to Articles 16.4 and 17 of the Understanding on
Rules and Procedures Governing the Settlement of Disputes (the "DSU"), and filed a Notice of

Appeal6 and an appellant's submission pursuant to Rules 20 and 21, respectively, of the Working
Procedures for Appellate Review (the "Working Procedures").7
5. On 30 March 2011, China notified the DSB of its intention to appeal certain issues of law
covered in the Panel Report and cer tain legal interpretations devel oped by the Panel, pursuant to
Articles 16.4 and 17 of the DSU, and filed a Notice of Other Appeal 8 and an other appellant's
submission pursuant to Rule 23(1) and (3), respectively, of the Working Procedures .
On 12 April 2011, the European Union and China each filed an appellee's submission. 9 O n
15 April 2011, Brazil, Colombia, Japan, and the United States each filed a third participant's
submission.10 On the same day, Canada, Chile, India, Norway, the Separate Customs Territory of
Taiwan, Penghu, Kinmen and Matsu, and Thailand each notified its in tention to appear at the oral
hearing as a third participant. 11 On 18 April 2011, Turkey notified its intention to appear at the oral
hearing as a third participant.12
6. The oral hearing in this appeal was held on 4-6 May 2011. The participants and six of the
third participants (Brazil, Colombia, India, Jap an, Norway, and the United States) made oral
statements.13 The participants and third participants r esponded to questions posed by the Members of
the Appellate Body Division hearing the appeal.
II. Arguments of the Participants and the Third Participants
A. Claims of Error by the European Union – Appellant
1. The Panel's Findings Regarding Article 9(5) of the Basic AD Regulation
"As Such"
7. The European Union argues that the Panel erred in finding that Article 9(5) of the Basic
AD Regulation is inconsistent with Articles 6.10, 9.2, and 18.4 of the Anti-Dumping Agreement ,
Article I:1 of the GATT 1994, and Article XVI:4 of the WTO Agreement 14, and asks the Appellate
Body to reverse these findings by the Panel.15

6WT/DS397/7 (attached as Annex I to this Report).
7WT/AB/WP/6, 16 August 2010.
8WT/DS397/8 (attached as Annex II to this Report).
9Pursuant to Rules 22 and 23(4) of the Working Procedures.
10Pursuant to Rule 24(1) of the Working Procedures.
11Pursuant to Rule 24(2) of the Working Procedures.
12Pursuant to Rule 24(4) of the Working Procedures.
13Turkey made concluding remarks at the oral hearing.
14European Union's appellant's submission, para. 14.
15European Union's appellant's submission, para. 227.

(a) The Scope of Article 9(5) of the Basic AD Regulation
8. The European Union claims that the Panel erre d in finding that Article 9(5) of the Basic
AD Regulation concerns not only the imposition of anti-dumping duties but also the calculation of
margins of dumping, and that the Panel erred in the application of Article 6.10 of the Anti-Dumping
Agreement when finding that Article 9(5) of the Basic AD Regulation is, "as such", inconsistent with
that provision. The European Union therefore conte nds that the Panel's finding of inconsistency with
Article 6.10 was premised on an incorrect unders tanding of the scope of Article 9(5), since
Article 6.10 addresses the determination of margins of dumping, while Article 9(5) is directed at the
imposition of anti-dumping duties.
16 The European Union asks the Appellate Body to reverse these
findings of the Panel.17
9. The European Union argues that, although the Panel considered that the meaning of
Article 9(5) of the Basic AD Regulation was a "factual matter", this error can be reviewed by the
Appellate Body because the examination by a pane l of the municipal law of a WTO Member for
purposes of determining whether the Member has complied with its WTO obligations is a legal
characterization by a panel, which is subject to appellate review under Article 17.6 of the DSU.18
10. According to the European Union, an examination of Article 9(5) of the Basic AD Regulation
on its face, based on its text and in the context of other articles of the Basic AD Regulation, shows
that Article 9(5) deals exclusively with the imposition of anti-dumping duties. 19 The European Union
contends that, in view of the "as such" nature of China's claim, any disagreement between the parties
on the scope of the measure at issue should have been resolved by examining Article 9(5) on its face.
Considering that the text of Article 9(5) makes it clear that, on its face, this provision relates to only
the individual or country-wide imposition of anti-du mping duties, in the European Union's view, the
Panel should have ended its examinat ion of the scope of Article 9(5) at this stage. The European
Union adds that, when Article 9(5) is read in the context of other provisions of the Basic
AD Regulation, the same conclusion is reached regarding its meaning and content.20
11. The European Union claims that the Panel e rred in concluding that nothing in the other
articles of the Basic AD Regulation cited by the European Union "pertains to whether or not an
individual margin will be calculated for any fore ign producer or exporter", and asserts that other

16European Union's appellant's submission, para. 88.
17European Union's appellant's submission, para. 110.
18European Union's appellant's submission, para. 89 (referring to Appellate Body Report, US –
Section 211 Appropriations Act, para. 105; and Appellate Body Reports, China – Auto Parts, para. 225).
19European Union's appellant's submission, para. 90.
20European Union's appellant's submission, para. 95.

provisions of the Basic AD Regulation address directly or indirectly the separate threshold issue of the
determination of individual dumping margins. The Eu ropean Union makes reference to: Article 2(7)
of the Basic AD Regulation, which determines wh ether suppliers should receive market economy
treatment ("MET") and whether individual margins of dumping will be calculated for these suppliers;
Article 11(4) of the Basic AD Regulation, which re quires the calculation of individual margins of
dumping in the context of new exporters' reviews; and Article 11(8) of the Basic AD Regulation,
which requires that margins of dumping be establishe d on an individual basis in the context of refund
proceedings.21 According to the European Union, the numerous references in the Basic
AD Regulation to the determination of individual dumping margins make sense in view of the
obligation set out in Article 9(4) to establish the ceiling for the amount of anti-dumping duties by,
inter alia, reference to the margin of dumping established. It is thus Article 9(4) that indicates that the
EU authorities should calculate an individual dumping margin per supplier.
22
12. The European Union further contends that th e operation of Article 9(5) of the Basic
AD Regulation in the context of anti-dumping inves tigations confirms that this provision addresses
specifically the imposition of anti-dumping duties. The European Union explains that Article 9(5)
serves to identify the relevant supplier in the context of imports from non-market economies
("NMEs") (that is, an independent supplier or the State and its related or controlled export entities)
and that other relevant rules determine the proper duty rate for individual treatment ("IT") suppliers
and non-IT suppliers. The Panel's finding that Ar ticle 9(5) determines whether an individual or
country-wide dumping margin will be established for an exporter from an NME ignores the fact that
the determination of the dumping margin for a supplier entitled to an individual dumping margin
flows from the rule contained in Article 9(4) of the Basic AD Regulation, which China did not specify
as the measure at issue in the present dispute. 23 Moreover, according to the European Union, an
individual duty is not automatically based on an individual dumping margin, which serves as a ceiling
for the amount of the anti-dumping duty.24
13. Finally, the European Union contends that, ev en if the determination of dumping and the
imposition of duties are closely related issues, this does not mean that Article 9(5), which specifically
addresses the imposition of anti-dumping duties, also incorporates by implication any other related

21European Union's appellant's submission, para. 96.
22European Union's appellant's submission, para. 97.
23European Union's appellant's submission, para. 104.
24European Union's appellant's submission, para. 105.

issues that may derive as a consequence of its opera tion. The European Union emphasizes that such
an approach should be rejected, particularly in the case of "as such" claims.
25
(b) Article 6.10 of the Anti-Dumping Agreement
14. The European Union claims that the Panel e rred in its interpretation and application of
Article 6.10 of the Anti-Dumping Agreement and failed to comply with Article 11 of the DSU in
finding that Article 9(5) of the Basic AD Regula tion is inconsistent with Article 6.10 of the
Anti-Dumping Agreement because it conditions the calculation of individual dumping margins for
producers from NMEs on the fulfilment of the IT test. 26 The European Union requests the
Appellate Body to reverse this finding by the Panel.27
15. The European Union contends that Article 6.10, first sentence, does not impose an
unqualified obligation to determine individual dumping margins. The term "as a rule", which is
inserted after the word "shall", indicates that the obl igation is only a general principle and not a strict
obligation that is to be complied with in any and all circumstances. 28 Article 6.10 should not be read
as being structured in the manner of a "rule/only exception"; rather, it expresses a preference for
determining individual dumping margins and then refers to one affirmative situation (sampling) where
such a preference "may" not be followed.
29 According to the European Union, there is no direct link
between the general principle of the first sente nce and the possibility of sampling in the second
sentence of Article 6.10.
16. The European Union points out that earlier pane ls have interpreted Article 6.10 in a more
flexible manner than this Panel, as not requiring the calculation of individual dumping margins for
each known exporter or producer in all cases. Th e European Union refers to the panel in Korea –
Certain Paper, which interpreted the term "exporter and producers" in Article 6.10 as permitting the
combination of separate entities in a single supp lier that is the "actual source of price
discrimination".
30 The European Union also refers to the panel in EC – Salmon (Norway) , which
found that the term "exporter and producers" in Article 6.10 means that an investigating authority may

25European Union's appellant's submission, para. 107.
26European Union's appellant's submission, para. 112.
27European Union's appellant's submission, para. 157.
28European Union's appellant's submission, para. 114.
29European Union's appellant's submission, para. 117.
30European Union's appellant's submission, para. 120 (referring to Panel Report, Korea – Certain
Paper, para. 7.161).

calculate dumping margins based on the producer's pricing behaviour, notwit hstanding the existence
of a known exporter for the product under investigation.31
17. According to the European Union, the fact that Article 6.10, first sentence, does not contain a
strict rule, as the Panel found, is further supporte d by the existence of other situations where the
preference does not need to be followed. In partic ular, the European Union refers to the following
examples: (1) a non-cooperating exporter or produ cer for whom the dumping margin is calculated
based on facts available, pursuant to Article 6.8 of the Anti-Dumping Agreement; (2) an exporter that
exports the product of another supplier (mere "trader") and that is assigned the dumping margin of the
actual supplier; (3) the situation where the act ual producer of the produc t concerned cannot be
identified; (4) the situation where an investigating authority has to calculate a single dumping margin,
based on constructed normal value and export price, due to insufficient information; and (5) a known
producer, related to an exporter or producer already subject to anti-dumping duties, that did not export
the product during the period of investigation and that would not be entitled to an individual dumping
margin in the investigation, nor in the context of a review pursuant to Article 9.5 of the Anti-Dumping
Agreement.
18. The European Union observes that the Panel dismissed these examples on the grounds that
they are directly based on other provisions of the Anti-Dumping Agreement, and that, "as such", they
could not be considered even potentially as excep tions to the obligation to calculate individual
dumping margins but rather as specific rights an d obligations otherwise provided for in the
Anti-Dumping Agreement. The European Union contends that, in doing so, the Panel ignored basic
principles of treaty interpretation, because, if other provisions of the Anti-Dumping Agreement (such
as Article 6.8) directly and expressly permit depa rting from the "mandatory rule" contained in
Article 6.10, first sentence, the only conclusion that the treaty interpreter can reach is that Article 6.10
cannot be interpreted in such a rigid manner. 32 The European Union submits that Article 9(5) of the
Basic AD Regulation addresses a situation other than sampling where the preference expressed in
Article 6.10 does not need to be followed. Therefor e, Article 9(5) of the Basic AD Regulation is "as
such" consistent with Article 6.10 of the Anti-Dumping Agreement.
19. The European Union claims that, even assumi ng that Article 6.10 is understood to contain a
strict rule to requiring the determination of in dividual dumping margins for each known exporter or
producer, the Panel erred in its application of Article 6.10 because it ignored the fact that Article 9(5)
of the Basic AD Regulation aims at identifying the supplier that is the actual source of price

31European Union's appellant's submission, para. 121 (referring to Panel Report, EC – Salmon
(Norway), para. 7.178).
32European Union's appellant's submission, para. 122.

discrimination in the context of imports from NMEs. In this respect, the European Union contends
that the purpose of the IT test is to determine if the State and those entities that do not act
independently from the State should be treated as a single supplier.
33
20. The European Union relies on the findings of the panel in Korea – Certain Paper , which, in
the European Union's view, stand for the propositio n that, for the purpose of determining individual
dumping margins, Article 6.10 permits investigati ng authorities to determine that two or more
exporters and producers are part of the same entity. 34 The European Union adds that "[n]othing in the
Anti-Dumping Agreement supports the proposition that the panel in Korea – Certain Paper explored
the complete universe of relationships existing be tween separate entities to consider them as one
single entity". According to the European Union, the Anti-Dumping Agreement contains provisions
where, directly or indirectly, the relationship between two separate entities is relevant.35
21. The European Union argues that a determination of individual dumping margins for each
legal entity, regardless of whether they are de jure or de facto related to each other, would be contrary
to the object and purpose of Article 6.10 of the Anti-Dumping Agreement. Investigating authorities
should be allowed to determine one dumping marg in for related companies as a whole or for
companies that, because of their close relationship, behave in the market as one single entity.36
22. The European Union points out that the purpose of imposing and collecting anti-dumping
duties is to target the source of price discrimina tion and that a proper identification of the single
exporter or producer in a case where several related companies exist allows for the imposition of anti-
dumping duties on the actual source of price discrimination. In the view of the European Union, the
identification of the actual source of price discrimin ation and the application of a single duty rate in
the case of non-IT suppliers would avoid potenti al circumvention and additional dumping, which
could occur if exports could be channelled by re lated companies through the supplier with the lowest
duty rate.37
23. The European Union argues that the Article 9( 5) criteria not only reflect elements that
demonstrate direct or de jure control or interference by the State, but also reflect other elements that
indirectly and de facto limit the capacity of the exporter to ac t free from State interference. Contrary
to what the Panel found, the European Union contends that Article 9(5) does not merely relate to the
role of the State in the way business is conducted in a given country, but it aims also at determining

33European Union's appellant's submission, para. 137.
34European Union's appellant's submission, para. 139.
35European Union's appellant's submission, para. 140.
36European Union's appellant's submission, para. 141.
37European Union's appellant's submission, para. 142.

whether there is a close relationship between separat e legal entities and the State in NMEs. Thus, the
reasoning of the panel in Korea – Certain Paper is fully applicable to Article 9(5), considering that
the objective of the IT criteria is to identify the actual source of price discrimination, that is, the single
supplier of the product concerned, due to a close relationship.38
24. According to the European Union, whilst in th e case of market economies, as established by
the panel in Korea – Certain Paper, the close relationship between the separate legal entities has to be
examined on a case-by-case basis, in NMEs, since the role of the State is different than in market
economies, the presumption of State control is the general rule. Therefore, according to the
European Union, the reasoning of the panel in Korea – Certain Paper fully applies in cases of imports
from NMEs, starting with the presumption that all producers and exporters in an NME are,
effectively, arms of the State. The criteria of th e IT test are then applied to determine whether each
individual producer or exporter can demonstrate that it acts independently from the State.
39
25. The European Union further contends that the Panel acted inconsistently with Article 11 of
the DSU, because it disregarded evidence submitted by the European Union concerning the nature of
NMEs and China's status as an NME, as well as the fact that the Protocol on the Accession of the
People's Republic of China (China's "Accession Protocol") 40 entitles the European Union to treat
China as an NME until 2016. According to the Eu ropean Union, this evidence, which was not
contested by China, supports the presumption underlying Article 9(5) of the Basic AD Regulation that
all producers and exporters in an NME constitute a singl e entity together with the State. However, in
the European Union's view, the Panel ignored this evidence without providing reasoned and adequate
explanations for its conclusion 41, and merely stated that it was not convinced by this argument and
that the European Union had not pointed to any legal basis that would support it.
26. Finally, the European Union claims that the Panel erred in relying on the fact that the
European Union applies a test such as the one in Korea – Certain Paper "in addition to" the IT test.
The European Union remarks that its argument was not that the two tests are identical, but rather that
the relationship between non-IT suppliers and the State "is similar to" the relationship that the panel in
Korea – Certain Paper found between several legally distin ct entities producing the product under
investigation, for which the Korean authorities ha d calculated a single margin, treating them as a
single producer. In this respect, th e European Union argues, the application of both tests is irrelevant

38European Union's appellant's submission, para. 148.
39European Union's appellant's submission, para. 150.
40WT/L/432, 23 November 2001.
41European Union's appellant's submission, para. 154.

to the question of whether Article 9(5) of the Basi c AD Regulation is consistent with Article 6.10 of
the Anti-Dumping Agreement.
42
(c) Article 9.2 of the Anti-Dumping Agreement
27. The European Union claims that the Panel erred in interpreting and applying Article 9.2 of the
Anti-Dumping Agreement and violated Article 11 of the DSU when concluding that Article 9(5) of the
Basic AD Regulation violates Article 9.2 of the Anti-Dumping Agreement, and requests the Appellate
Body to reverse this finding by the Panel.43
28. The European Union claims th at, like Article 6.10 of the Anti-Dumping Agreement ,
Article 9.2 does not contain a mandatory rule rega rding the imposition of anti-dumping duties, but
rather a principle or a preference. The European Union argues that Article 9.2 reflects a product-wide
and country-wide approach in that it refers to the imposition of an anti-dumping duty on a "product",
not a company. 44 The European Union contends that it is particularly significant that Article 9.2
refers to sources found to be dumped and causing injury, since injury is a country-wide, rather than a
company-specific, concept.45
29. The European Union thus contends that, contrary to the Panel's interpretation, Article 9.2 does
not impose an obligation to grant individual treatment to, or to impose individual anti-dumping duties
on, exporters or producers. Article 9.2 merely cont ains an obligation to specify by name exporters or
producers where practicable. This, according to th e European Union, may serve to distinguish
between exporters or producers included in the anti-dumping investigation and new exporters or
producers that may request a review pursuant to Article 9.5 of the Anti-Dumping Agreement.
46
30. The European Union contends that the Panel in terprets Article 9.2 as providing for the same
general rule (individual duties) and the same single exception (sampling) as contained in Article 6.10,
which would make Article 9.2 redundant.47 The European Union argues that the purpose of imposing
anti-dumping duties (that is, to offset and to prev ent dumping) also supports its interpretation that
Article 9.2 does not require the imposition of i ndividual anti-dumping dutie s on all known exporters
and producers. In this respect, the European Un ion claims that, once dumping has been found to exist
for the product concerned with respect to some inve stigated companies, a further examination of the

42European Union's appellant's submission, para. 155.
43European Union's appellant's submission, paras. 158 and 208.
44European Union's appellant's submission, para. 161.
45European Union's appellant's submission, para. 162.
46European Union's appellant's submission, para. 163.
47European Union's appellant's submission, para. 163.

pricing behaviour of other entities would not be re quired in order to impose anti-dumping duties in
order to offset and prevent dumping.48
31. Assuming that Article 9.2 of the Anti-Dumping Agreement contained a strict rule to impose
anti-dumping duties on an individual basis, the European Union submits that the Panel erred in
finding that Article 9(5) of the Basic AD Regulation does not fall within the exception under
Article 9.2, third sentence, which would only be available in cases where the authorities consider that,
because of the large number of producers involved, it would be impracticable to name exporters or
producers individually. The European Union is of the view that, like Article 6.10, Article 9.2
expressly permits the imposition of duties on a co untry-wide basis in cases ot her than the sampling
scenario, in particular when it is "impracticable" to do so on an individual basis, consistently with the
notion that these provisions should be interpreted in a flexible manner.
49
32. The European Union points out that Article 9.4 of the Anti-Dumping Agreement addresses the
specific situation of the imposition of anti-dumping du ties when sampling is used, and contends that
interpreting "impracticable" in Article 9.2 as re ferring only to sampling would make Article 9.4
redundant and unnecessary.50
33. The European Union argues that the Panel's in terpretation of the term "impracticable" in
Article 9.2 is both redundant and t oo rigid and that this term shoul d be interpreted in a flexible
manner.51 According to the European Union, the notion of "impracticable" in Article 9.2
encompasses the notion of "ineffective". This situ ation is envisaged in Article 9(5) of the Basic
AD Regulation, which provides for the imposition of country-wide duties, where anti-dumping duties
cannot be imposed on an individual basis for "practical" reasons. The European Union explains that it
would not be effective to impose individual anti-dump ing duties on suppliers that are all related to the
State, because this may lead to circumvention of the higher anti-dumping duties imposed on some
individual exporters by channelli ng exports through those exporte rs for whom the lowest anti-
dumping duties have been calculated.
52
34. The European Union submits that its interp retation of the exception to the individual
treatment of producers or exporters contemplated unde r Article 9.2 is also confirmed by the analysis
of supplementary means of interpretation and, in particular, by the negotiating history and the
circumstances at the conclusion of the Kennedy Round Agreement on Implementation of Article VI of

48European Union's appellant's submission, para. 164.
49European Union's appellant's submission, para. 168.
50European Union's appellant's submission, para. 170.
51European Union's appellant's submission, para. 174.
52European Union's appellant's submission, para. 187.

the General Agreement on Tariffs and Trade (the " Kennedy Round Anti-Dumping Code ").
53
According to the European Union, the negotiating hi story and the circumstances at the conclusion of
Article 8(b) of the Kennedy Round Anti-Dumping Code show that negotiators were aware of the
problems associated with imposing anti-dumping dut ies on imports from NMEs. They clarified that
anti-dumping duties could be imposed on a country-w ide basis in cases where it was "impracticable"
to specify duties on an individual b asis. The European Union notes th at no limits were imposed on
the notion of "impracticability", which included not only cases where suppliers could not be examined
individually because they were too numerous or because they did not make themselves known or did
not trade during the period examined, but also ot her situations, such as imports from NMEs. The
notion of "impracticability" provided the necessar y flexibility when imposing anti-dumping duties in
order to remedy injurious dumping and, at the same time, preserved the rights of the other signatories
through the obligation to provide refunds.
54
35. The European Union further claims that the Panel erred in considering irrelevant the fact that
Article 8 and Article 2(g) were introduced into the Kennedy Round Anti-Dumping Code together and
for the first time. The European Union observes that Article 2(g), which incorporated the second
Ad Note to Article VI:1 of the GATT 1994, speci fically referred to a situation where "special
difficulties … in determining price comparability " existed and, thus, a situation where it was
"impracticable" to use the normal methods for determining the existence of dumping.55
36. The European Union claims that the Panel erre d in its application of Article 9.2 of the
Anti-Dumping Agreement, which, in the European Union's view , does not exclude that the State could
be considered as the actual source of price discrimination or as a single supplier for the purposes of
imposing anti-dumping duties. The European Union argues that the terms "sources" and "supplier" in
Article 9.2 may also include the State in cases wher e the State is an exporter or producer, because the
use of these terms implies that anti-dumping measures aim at identifying the supplier that is the actual
source of the price discrimination. This could be one exporter, one producer, or a group of related
exporters and/or producers.
56
37. The European Union argues that, in rejecting the notion that in NMEs the State can be
presumed to be the source of price discrimination, the Panel acted inconsistently with its duties under
Article 11 of the DSU, because it disregarded evid ence presented by the Euro pean Union regarding
NMEs in general and China's status as an NME, and failed to provide reasoned and adequate

53BISD 15S/24, entered into force 1 July 1968.
54European Union's appellant's submission, para. 184.
55European Union's appellant's submission, para. 182.
56European Union's appellant's submission, para. 194.

explanations for its findings. Alt hough the Panel stated that it addr essed this issue elsewhere in its
findings, the European Union contends that no explanation was provided by the Panel as to why in
NMEs the State cannot be presumed to be a producer and the actual source of price discrimination.
To the extent that the Panel discu ssed this issue in its Report, th e European Union argues that the
Panel failed to provide a reasoned a nd adequate explanation for its fi nding and thus failed to make an
objective analysis of the matter.57
38. The European Union claims that, in NMEs, because of State control over the means of
production and State intervention in the economy, incl uding international trade relations, all exports
can be considered to emanate from the State, wh ich can be considered as one single supplier whose
dumping behaviour can be identified and addresse d in accordance with the disciplines of the
Anti-Dumping Agreement. The European Union further contends that it has shown that China is an
NME and that, in accordance with paragra ph 15(d) of China's Accession Protocol, the
European Union is entitled to treat China as an NME in anti-dumping proceedings with all the
consequences that this determination entails.58
39. The European Union argues that the Panel erred in finding that Article 9(5) of the Basic
AD Regulation does not serve to identify the source of price discrimination, because it took a narrow
view of the notion of "source of price discrimination" as being limited exclusively to the
determination of export prices. In the view of th e European Union, the source of price discrimination
is both the determination of export prices and th e determination of norma l value, even though
suppliers from NMEs may not actually control the de termination of their normal value. In this
respect, the European Union observes that, while anti-dumping disciplines address the phenomenon of
international price discrimination, Article 2.1 of the Anti-Dumping Agreement does not require a
conscious pricing decision with the intention of dumping by the entity concerned. Moreover, the
European Union observes that the IT test criteria embodied in Article 9(5) are not limited to the
determination of export prices, but aim at identifying whether the applicant company acts
independently from the State in its export activities.
59
40. In sum, the European Union claims that Article 9(5) serves to identify the relevant supplier in
the context of imports from NMEs. The supplier will be the individual supplier if it can show that it
meets the five criteria in the IT test. However, fa ilure to meet these criteria will mean that the non-IT

57European Union's appellant's submission, para. 195.
58European Union's appellant's submission, para. 196.
59European Union's appellant's submission, para. 203.

supplier is not the genuine exporter or producer, but an entity that does not act independently from the
State and, thus, should be subject to the actual supplier, country-wide duty rate.
60
(d) Article I:1 of the GATT 1994
41. The European Union claims that the Panel e rred in the interpretation and application of
Article I:1 of the GATT 1994 and acted inconsistently with Article 11 of the DSU, when it found that
Article 9(5) of the Basic AD Regulation is inconsis tent with the MFN obligation of Article I:1 of the
GATT 1994. The European Union argues that it is en titled to grant formally different treatment to
imports from market economies and from NMEs because such imports are different in nature. The
European Union adds that the word ''unconditionall y'' in Article I:1 does not preclude an advantage
being subjected to conditions as long as this does not result in de facto discrimination.61
42. Moreover, the European Union claims that the alleged advantage granted to market
economies was based on the nature of the suppliers involved, and not on the product itself. The
European Union contends this was a ''very important point that the Panel failed to acknowledge'' since
it means that discrimination between like products originating in different countries does not arise in
this case.
62 The European Union further contends that, in assessing China's claim under Article I:1 of
the GATT 1994, the Panel failed to fulfil its duties under Article 11 of the DSU, because it did not
examine the evidence submitted by the European Un ion regarding China's status as an NME. The
European Union asserts that it did demonstrate that market economies and NMEs, by definition, are in
a different situation and that this evidence justifie s the formally different treatment it conferred to
imports from China.63 This is so, the European Union argu es, because China's status as an NME was
not unilaterally determined by the European Unio n, but is based on paragraph 15(d) of China's
Accession Protocol. According to the European Union, the Panel's failure to examine this evidence is
contrary to its obligations under Article 11 of the DSU.64
43. The European Union also argues that the f act that under Article 9(5) of the Basic
AD Regulation producers from NMEs may be able to demonstrate that they are independent from the
State ensures that discrimination does not arise, b ecause, if a supplier complies with the conditions of
the IT test, it will be treated like a supplier of a market economy. 65 The European Union further
contends that the fact that the Basic AD Regula tion explicitly lists the NMEs whose producers will be

60European Union's appellant's submission, para. 206.
61European Union's appellant's submission, para. 212.
62European Union's appellant's submission, para. 213.
63European Union's appellant's submission, para. 214.
64European Union's appellant's submission, para. 215.
65European Union's appellant's submission, para. 217.

subject to the IT test is irrelevant to the questi on of non-discrimination, because this list is based on
evidence that the listed countries ar e in the same economic situation to be classified as NMEs and,
thus, confers the same treatment to all countries in the same category.66
44. Finally, the European Union argues that, even if the Appellate Body were to consider that
Article 9(5) of the Basic AD Regulation was inc onsistent "as such" with Article I:1 of the
GATT 1994, the different treatment of imports from NMEs would be permitted by the provisions of
the Anti-Dumping Agreement. The European Unio n remarks that the lex specialis principle and the
General Interpretative Note to Annex 1A of the WTO Agreement make it clear that, when a provision
of the Anti-Dumping Agreement conflicts with a provision of the GATT 1994, the former should
prevail. In this respect, the European Union argues that a conflict between a provision of the
GATT 1994 and a provision of the Anti-Dumping Agreement occurs not only in situations where a
rule in the GATT 1994 prohibits what a rule in the Anti-Dumping Agreement requires; a conflict also
exists when there is ''incompatibility of contents ". This scenario includes situations where an
agreement prohibits what another permits. The Eur opean Union further notes that Article 9.2 of the
Anti-Dumping Agreement already requires the imposition and collection of anti-dumping duties on a
non-discriminatory basis.67
(e) Article XVI:4 of the WTO Agreement and Article 18.4 of the
Anti-Dumping Agreement
45. As a consequence of the European Union's contention that the Panel wrongly found that
Article 9(5) of the Basic AD Regulation is inconsis tent "as such" with Articles 6.10 and 9.2 of the
Anti-Dumping Agreement, the European Union also requests the Appellate Body to reverse the Panel's
findings that the European Union acted in consistently with Article XVI:4 of the WTO Agreement and
Article 18.4 of the Anti-Dumping Agreement by failing to ensure the conformity of its laws,
regulations, and administrative procedures with its obligations under the relevant agreements.
2. The Panel's Findings Regarding Article 9(5) of the Basic AD Regulation
"As Applied" in the Fasteners Investigation
46. The European Union appeals the Panel's finding th at Article 9(5) of the Basic AD Regulation,
"as applied" in the fasteners investigation, is inconsistent with Artic les 6.10 and 9.2 of the
Anti-Dumping Agreement . The European Union argues that, since the Panel erred in finding that
Article 9(5) of the Basic AD Regulation is inconsistent "as such" with the provisions of the

66European Union's appellant's submission, para. 218.
67European Union's appellant's submission, para. 222.

Anti-Dumping Agreement , the Appellate Body should also reve rse the Panel's "as applied" findings
with respect to the determinations made in the fasteners investigation.
68
47. The European Union argues that the Panel applie d the "as such/as applied" distinction in a
mechanical manner, and noted that there are m easures where the result that is found to be
WTO inconsistent "as such" may or may not take pl ace in an "as applied" context, depending on the
configuration of facts. The European Union conten ds that, in such cases, it cannot be found that the
same measure "as applied" is WT O inconsistent since, in reality, the result does not take place. 69 The
European Union points out that, while the Panel f ound Article 9(5) of the Basic AD Regulation to be
"as such" inconsistent with the provisions of the Anti-Dumping Agreement and of the GATT 1994, in
the fasteners investigation, each of the five cooperating sampled companies and each of the
cooperating companies examined individually were granted individual treatment. Thus, according to
the European Union, although the Panel found that Article 9(5) "as such" prevents the result that
suppliers from NMEs are entitled to obtain from the obligations contained in the Anti-Dumping
Agreement and the GATT 1994, in a case where all companies requesting individual treatment were
granted such treatment, there is no basis for a finding of inconsistency "as applied". According to the
European Union, for the Panel to say that there is a possibility that Article 9(5) affected participation
by Chinese exporters in the fasteners investigatio n and/or the quality and quantity of information
Chinese exporters provided to the Commission is pure speculation, and not based on evidence.70
48. The European Union argues that the Panel found that Article 9(5) of the Basic AD Regulation
leads to a particular result in th e absence of the required evidence to substantiate such a conclusion.
According to the European Union, the Panel erred by concluding that, having found Article 9(5) of
the Basic AD Regulation to be inconsistent "as such" with Articles 6.10 and 9.2 of the Anti-Dumping
Agreement, "for the same reasons", its application in th e fasteners investigation was also inconsistent
with these two provisions. Therefore, even if th e Appellate Body were to uphold the Panel's finding
in respect of Article 9(5) "as such" and "as applie d", the European Union requests the Appellate Body
to modify the Panel's reasoning on this issue.71
3. The Panel's Findings under Articles 6.4 and 6.2 of the Anti-Dumping
Agreement
49. The European Union requests the Appellate B ody to reverse the Panel's finding that the
European Union acted inconsistently with Articles 6.4 and 6.2 of the Anti-Dumping Agreement with

68European Union's appellant's submission, para. 228.
69European Union's appellant's submission, para. 230.
70European Union's appellant's submission, para. 231.
71European Union's appellant's submission, para. 232.

respect to certain aspects of the normal value determin ation. In the European Union's view, the Panel
erred in finding that Articles 6.4 and 6.2 required the Commission to disclose the factual
determination of how it grouped product types fo r purposes of determining normal value. The
European Union also maintains that the Panel made a purely consequential finding of violation of
Article 6.2 that is incorrect given the flaws in th e Panel's finding under Article 6.4. In addition, the
European Union submits that the Panel disregarde d certain important evidence on the record in its
factual findings and thus violated Article 11 of the DSU.
(a) The "Information" Subject to the Obligations under Articles 6.4
and 6.2 of the Anti-Dumping Agreement
50. The European Union claims that the Panel erre d when ''it effectively found that Articles 6.4
and 6.2 required the EU investigating authorities to have disclosed the manner in which they decided
to group product types fo r purposes of the normal value determin ation, prior to the disclosure of
essential facts, and as part of their obligation un der Article 6.4 to allow access to the file.''
72 T h e
European Union submits that such a factual determin ation by investigating authorities is not the kind
of information that is covered by th e obligation in Article 6.4 of the Anti-Dumping Agreement .
Rather, the European Union contends that this is merely an essential factual determination that was
disclosed at the end of the fasteners investig ation in the final General Disclosure Document 73, in
compliance with Article 6.9 of the Anti-Dumping Agreement . The European Union posits that a
proper interpretation of the term ''information'' in Ar ticle 6.4, which takes into account the context of
Article 6 as a whole, supports the proposition that f actual determinations by investigating authorities
are not subject to the obligation of Article 6.4.
51. The European Union contends that the term ''information'', read in the light of the sequence of
rights and obligations set out in the various paragraphs of Articles 6.1 to 6.8 of the Anti-Dumping
Agreement, refers to knowledge of facts as communicated by the interested parties or collected by the
investigating authorities. Referring to the panels' findings in Korea – Certain Paper, Korea – Certain
Paper (Article 21.5 – Indonesia), and US – Oil Country Tubular Goods Sunset Reviews (Article 21.5 –
Argentina), the European Union contends that the term ''in formation'', as used in Article 6.4, concerns
facts and ''raw data'', rather than "reasoning", factual determinations, or conclusions by the

72European Union's appellant's submission, para. 248.
73The General Disclosure Document (European Commission, Anti-dumping proceeding concerning
imports of certain iron or steel fasteners originating in the People's Republic of China, Proposal to impose
definitive measures, 3 November 2008) (Panel Exhibit CH N-18)) was the final disclosure document before the
Commission issued the Definitive Regulation.

investigating authorities.
74 The European Union further submits that this view is confirmed by the
Appellate Body's findings in EC – Tube or Pipe Fittings , which "assimilated" the term ''information''
in Article 6.4 with facts, evidence, or raw data that had not been disclosed to the interested parties.75
52. The European Union maintains that there is a logical sequence of events and corresponding
rights and obligations that is reflected in the various paragraphs and subparagraphs of Article 6 of the
Anti-Dumping Agreement. Specifically, the European Union submits that Articles 6.1 to 6.3 provide
parties with the right to submit their own evidence in writing and to make their views known at an
oral hearing. Articles 6.6 and 6.7, in turn, impose an obligation on investigating authorities to verify
the information submitted by the parties, and Article 6.8 allows the use of "facts available" when any
interested party does not provide necessary info rmation. Thus, the European Union asserts,
Article 6.4 is limited to addressing "t he parties' right to know what other interested parties have
submitted in terms of evidence and information".
76 Moreover, the European Union recalls that
Article 6.9 requires that, before a final determina tion is made, the authorities inform all interested
parties of "the essential facts under consideration which form the basis for the decision whether to
apply definitive measures". In the European Un ion's view, the use of the phrase "essential facts"
rather than the word "information" in Article 6.9 indicates that Articles 6.1 to 6.8 concern the
information-gathering process, and Article 6.9 mark s the end of the process and requires a disclosure
of the authority's essential factual conclusions. The European Union further contends that the
differences between the obligations under Article 6.4 and Article 6.9 are well established in
WTO jurisprudence. For example, in Guatemala – Cement II , the panel found that Article 6.4
generally provides an "access to the file" right 77, whereas Article 6.9 provides for a disclosure of the
basic factual findings in respect of the information received.
53. The European Union submits that the Panel fa iled to recognize the important differences
between the various paragraphs of Article 6, and erroneously consider ed that Article 6.4 also applied
in respect of the authorities' factual findings disclosed under Article 6.9 of the Anti-Dumping
Agreement. This is because the Panel did not find th at non-confidential evidence gathered by the
Commission was not made available to the interested parties. Rather, the Panel's finding concerns the
fact that the Commission in its General Disclosure Document stated that the normal value

74European Union's appellant's submission, paras. 252 (quoting Panel Report, Korea – Certain Paper
(Article 21.5 – Indonesia) , para. 6.82) and 253 (referring to Panel Report, Korea – Certain Paper , para. 7.199;
and Panel Report, US – Oil Country Tubular Goods Sunset Reviews (Article 21.5 – Argentina), para. 7.124).
75European Union's appellant's submission, para. 254 (referring to Appellate Body Report, EC – Tube
or Pipe Fittings, paras. 138-141).
76European Union's appellant's submission, para. 260. (original emphasis)
77European Union's appellant's submission, para. 268 (referring to Panel Report, Guatemala –
Cement II, para. 8.230).

determination was based on a grouping of products as certain "product types", as opposed to Product
Control Numbers ("PCNs")78, which were reflected in the request for data in the questionnaires sent to
the Chinese producers and exporters, but did not provide any information as to the relevant
characteristics of those "product types". Howeve r, the European Union argues, the grouping of
products is not raw data submitted by the parties or gathered by the Commission, but is "simply the
determination by the European Commission of what constituted a proper way of grouping products
per model or type, based on the information on product types which was in the public record". 79 The
Panel thus erred in finding that the Commissi on was required by Article 6.4 to provide timely
opportunities to the Chinese interested parties to see such "information".
(b) Whether the "Information" Was Made Available to the Interested
Parties in a "Timely" Manner within the Meaning of Article 6.4 of
the Anti-Dumping Agreement
54. The European Union claims that the Panel fa iled to conduct an objective assessment of the
facts when finding that the European Union act ed inconsistently with Article 6.4 of the Anti-Dumping
Agreement by not providing a timely opportunity for Chinese producers to see information regarding
the product types on the basis of which normal valu e was established. Specifically, the European
Union submits that the Panel disregarded certain critical evidence and thus failed to consider the
evidence before it in its totality, as required by Article 11 of the DSU.
55. The European Union recalls that the Panel re lied on the final General Disclosure Document,
issued on 3 November 2008, to conclude that, for th e first time during the investigation, the Chinese
interested parties were informed that "the Commission based its normal value determination on
'product types', as opposed to PCNs", and that the General Disclosure Document did not "provide any
information as to the relevant characteristics of those groups, or how they were determined".
80
However, the European Union argues, the Panel disregarded certain evidence on the record that
contradicts this factual finding. Specifically, the Information Document 81, issued on 4 August 2008,
contains the same paragraphs as those in the Gene ral Disclosure Document that the Panel referred to,
with the exact same refe rences to the use of ''product types''. The Information Document, signalling
the use of ''product types'', was thus sent to all interested parties for comments three months before the

78PCNs contain the following elements identified by the Commission: type of fasteners (by CN code);
strength/hardness; coating; presence of chrome on coating; diameter; and length/thickness. (See Panel Report,
para. 7.293)
79European Union's appellant's submission, para. 274.
81European Commission, Anti-dumping proceeding concerning imports of certain iron or steel fasteners
originating in the People's Republic of China, Non-imposition of provisional anti-dumping measures,
4 August 2008 (Panel Exhibit CHN-17).

issuance of the General Disclosure Document, yet no request to see the characteristics that formed the
basis for the product types was received until 8 No vember 2008. Moreover, the Panel also ignored
the fact that the Commission's decision to group produ ct types according to the strength class and the
distinction between standard and special fasteners was based on arguments and information submitted
by the Chinese interested parties dur ing the investigation. Indeed, th e Chinese interested parties were
able to make presentations on exactly those elemen ts that were used by the Commission to group
product types. Thus, in the European Union's view, it is clear that the interested parties had a timely
opportunity to see information on the product types and to present their views.
56. The European Union further submits that, even assuming that the interested parties were only
informed of the use of product types in the Genera l Disclosure Document, the fact that the European
Union ultimately disclosed the basis for the pr oduct types to the Chinese producers remains
unchanged. On the basis of this disclosed in formation, a Chinese interested party submitted
comments in a letter dated 24 November 2008, in whic h it did not request an extension of time for
making further presentations or submit any evidence relating to the need to make adjustments for
differences affecting price comparability.
82 In the European Union's view, this letter, which the Panel
ignored, demonstrates that a presentation was made on the basis of the ''information'' provided and
therefore that the ''information'' was made available in a timely manner.
(c) The Panel's Finding under Article 6.2 of the Anti-Dumping
Agreement
57. The European Union maintains that, because it has demonstrated that the Panel's finding
under Article 6.4 was flawed, the Panel's "purely con sequential" finding under Article 6.2 was also in
error.83 In addition, the European Union submits that Article 6.2 cannot be read to constitute a mere
reiteration of the right under Article 6.4 to see the information.
58. The European Union contends that the Panel made a purely consequential finding of violation
of Article 6.2 when it considered that the viola tion of Article 6.4 on access to information also
constituted a violation of the general right of de fence allegedly set forth in Article 6.2 of the
Anti-Dumping Agreement. The European Union contends that the Panel made the error of reading the
obligation in Article 6.4 into Article 6.2, thus erroneously collapsing both provisions, even though
Article 6.2 sets forth an important but limited and specific obligation of its own. The European Union
finds support for this view in the panel's finding in Korea – Certain Paper that Article 6.2 does not

82Letter dated 24 November 2008 from Van Bael & Bellis to the European Commission on behalf of
Kunshan Chenghe Standard Component Co. Ltd. (Panel Exhibit EU-12).
83European Union's appellant's submission, para. 275.

"address interested parties' right to see the information on the record". 84 The European Union further
argues that the first sentence of Article 6.2, refe rring to the "full opportunity for the defence of
[interested parties'] interests" cannot "be read as a catch-all due process provision", because doing so
"would effectively render redundant all of the other provisions of Article 6 which impose specific
obligations on investigating authorities".85
(d) Conclusion
59. In sum, the European Union asserts that a prope r interpretation of the relevant provisions, as
well as a proper assessment of the facts and evid ence on the record, should have led the Panel to
conclude that no violation of Article 6.4, and thus no consequential vi olation of Article 6.2, had been
demonstrated. Therefore, the European Union re quests the Appellate Body to reverse the Panel's
finding that the European Union acted incons istently with Articles 6.4 and 6.2 of the Anti-Dumping
Agreement concerning the product types used for purposes of normal value determination.
4. The Panel's Findings under Articles 6.5 and 6.5.1 of the Anti-Dumping
Agreement Regarding Non-Confidential Questionnaire Responses
60. The European Union requests the Appellate Body to reverse the Panel's findings that the
European Union acted inconsistently with Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement with
respect to confidentiality requests and non-conf idential summaries of confidential information
received in the fasteners investigation. Specifically, the European Union contends that the Panel erred
in finding that the Commission acted inconsistently with Article 6.5.1 because it failed to require that
domestic producers furnish appropriate statements of the reasons why information submitted in
confidence was not susceptible of summary, and wi th Article 6.5 because it treated as confidential
information received from the analogue country pro ducer, Pooja Forge, without examining whether
"good cause" supported this confidential treatment.
(a) Non-Confidential Summaries of Domestic Producers' Questionnaire
Responses
61. The European Union claims that the Panel erre d in its interpretation and application of the
obligations contained in Article 6.5.1 of the Anti-Dumping Agreement when it found that the
Commission failed to require domestic producers to pr ovide "appropriate" statements of the reasons
why summarization of confidential information was not possible. In the European Union's view,
Article 6.5.1 imposes only a "best endeavours" ob ligation on investigating authorities to require

84European Union's appellant's submission, para. 276 (quoting Panel Report, Korea – Certain Paper ,
para. 7.306).
85European Union's appellant's submission, para. 277. (original emphasis)

parties to provide non-confidential summaries of information submitted in confidence, or, in the
alternative, a statement of the reasons explaining why summarization is not possible.
86 T h e
European Union contends that the Panel erred in finding that Article 6.5.1 further obliges
investigating authorities to ensure that such summaries or statements of reasons are "appropriate".87
62. Under the interpretation of Article 6.5 of the Anti-Dumping Agreement proffered by the
European Union, the only obligations imposed on i nvestigating authorities are: (1) not to disclose
confidential information without the specific permis sion of the submitting party; and (2) to require
interested parties to provide non-confidential summaries of information submitted in confidence. 88
The European Union argues that Article 6.5 is ther efore concerned "first and foremost" with assuring
parties that information submitted in confidence will be treated as confidential and will not be
disclosed without their permission. 89 Article 6.5.1, then, imposes a "best endeavours" obligation on
authorities to require that parties provide a non- confidential summary of information submitted in
confidence so that other interested parties have a reasonable understanding of the substance of the
confidential information. 90 In the European Union's view, it is also "permissible" for submitting
parties not to summarize certain information, as long as they indicate that summarization is not
possible, and provide a "statement of the reasons" as to why such summarization is not possible. 91
The European Union claims that, because Article 6.5 does not allow an authority to disregard
information properly treated as confidential, regard less of whether or not a non-confidential summary
or statement of reasons is provided, Article 6.5. 1 cannot be read strictly to require that such
summaries or statements be provided.92 "Absent the necessary stick" th at would allow an authority to
penalize noncompliance, the European Union insi sts that Article 6.5.1 can only impose a "best
efforts" obligation on authorities to "push inter ested parties to be as transparent as possible". 93 The
European Union does not see that any "risk of abuse" would result from such an interpretation, as the
Panel warned, as long as the request for confidential treatment is warranted.94
63. The European Union argues that prior WTO pane ls that interpreted Article 6.5.1 of the
Anti-Dumping Agreement as imposing a duty on investigating authorities to require parties to submit a
statement of reasons described the "outer boundari es of the obligation imposed by Article 6.5.1". 95

86European Union's appellant's submission, para. 298.
87European Union's appellant's submission, para. 310.
88European Union's appellant's submission, para. 314.
89European Union's appellant's submission, para. 316.
90European Union's appellant's submission, para. 317.
91European Union's appellant's submission, para. 317.
92European Union's appellant's submission, para. 320.
93European Union's appellant's submission, para. 321.
94European Union's appellant's submission, para. 322.
95European Union's appellant's submission, para. 327.

The panel's reasoning in Mexico – Steel Pipes and Tubes supports this argument, and stated that
Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement do not contain any obligation with regard to
how an authority should comply with the requirements thereunder. 96 The European Union further
alleges that the Panel misinterpreted the findings of the panel in Mexico – Olive Oil when it relied on
that case for its conclusion that the pro forma "general statements" of the domestic producers were not
sufficient to constitute an appropriate statement of reasons as to why summarization of confidential
information was not possible.97
(b) Confidential Treatment of Information Obtained from Pooja Forge
64. The European Union contends that the Panel erred in making findings under Article 6.5 of the
Anti-Dumping Agreement with regard to the confidential tr eatment of Pooja Forge's questionnaire
responses, and that, substantively, the Panel also erre d in its application of the chapeau of Article 6.5
to Pooja Forge. Specifically, th e European Union argues that the claims relating to Pooja Forge's
questionnaire response were not contained in China's panel request 98, and therefore not within the
Panel's terms of reference, and that the Panel thus e rred in making findings in this respect, contrary to
Article 7.1 of the DSU. In the alternative, the European Union alleges that the manner in which China
pursued its claim under Article 6.5, and the manner in which the Panel dealt with this claim, deprived
the European Union of its due process rights. If the Appellate Body determines that the Panel did not
err in considering this claim to be within its terms of reference and making findings on it, the
European Union argues that the Panel neverthele ss erred in its application of the chapeau of
Article 6.5 because the requirement to show "go od cause" in support of a request for confidential
treatment applies only to "interested parties" and does not apply to analogue country producers.
(i) Terms of reference and due process
65. The European Union claims that the Panel did not have jurisdiction over China's claim under
Article 6.5 relating to Pooja Forge's questionnaire responses, because this cl aim was not included in
China's panel request as required under Article 6.2 of the DSU. The relevant portion of China's panel
request did not mention the Indian producer, Pooja Forge, and "unambiguously states that China
brings a claim only with regard to domestic producers".
99 The European Union acknowledges that it
did not formally raise this challenge before the Pa nel, but states that the Panel had an obligation to
examine its jurisdiction on its own moti on, and that it failed to do so. In Mexico – Corn Syrup
(Article 21.5 – US) , the Appellate Body explained that "panels cannot simply ignore issues which go

96European Union's appellant's submission, para. 328.
97European Union's appellant's submission, para. 329.
98European Union's appellant's submission, paras. 335-339.
99European Union's appellant's submission, para. 335.

to the root of their jurisdiction"
100, and in Guatemala – Cement I, it found that a panel must determine
whether a party has "properly identified a relevant antidumping measure in its panel request" before it
may find that a dispute is properly before it. 101 In making findings on this claim, then, the
European Union argues, the Panel violated Article 7.1 of the DSU.102
66. Should the Appellate Body find that China' s claims with respect to Pooja Forge's
questionnaire response were within th e Panel's terms of reference, the European Union argues that, in
the alternative, the Panel violated its obligations under Article 11 of the DS U because the manner in
which it dealt with this claim deprived the Eur opean Union of its rights to due process. Citing US –
Continued Zeroing , the European Union argues that the Pane l used its questions impermissibly to
"make the case"103 for China. Only in response to Panel Question 71 did China begin to formulate its
claims with respect to Pooj a Forge's questionnaire response 104; and only in response to Panel
Question 103, after the second substantive meeting of the Panel with the parties, did China "finally
clarif[y] that it actually made a claim under both Ar ticles 6.5 and 6.5.1 with respect to Pooja Forge's
questionnaire response".105
67. The European Union points out that the Panel itself admitted that the claim was unclear, and
that this lack of clarity led it to pos e questions to China in this regard. 106 Despite the Panel's
suggestion to the contrary, the European Union clai med throughout this process that it was "not in a
position to provide adequate responses due to the confusion" about China's claim. 107 For these
reasons, the European Union requests the Appellate Body to reverse the Panel's finding that the
European Union acted inconsistently with Article 6.5 of the Anti-Dumping Agreement with respect to
confidential treatment of information in the questionnaire response of the Indian producer,
Pooja Forge.

100European Union's appellant's submission, para. 337 (quoting Appellate Body Report, Mexico – Corn
Syrup (Article 21.5 – US), para. 36).
101European Union's appellant's submission, para. 338 (quoting Appellate Body Report, Guatemala –
Cement I, para. 88).
102European Union's appellant's submission, para. 339.
103European Union's appellant's submission, paras. 342 and 343 (quoting Appellate Body Report, US –
Continued Zeroing, para. 343).
104European Union's appellant's submission, para. 343.
105European Union's appellant's submission, para. 344.
107European Union's appellant's submission, para. 346.

(ii) Application of Article 6.5 to analogue country producers
68. Substantively, the European Union argues that the Panel erred in its interpretation and
application of Article 6.5 when it found that the Commission failed to require the Indian producer,
Pooja Forge, to demonstrate that "good cause" existed for the confidential treatment of certain product
type information in its questionnaire response. Acco rding to the European Union, Article 6.5 applies
only to "parties to an investigation", which includes "interested parties" as defined in Article 6.11 of
the Anti-Dumping Agreement .108 The European Union contends that the Panel implicitly
acknowledged this interpretation when it used the term "interested parties" in making its findings on
this claim.109 The definition of "interested parties" does not include producers from analogue third
countries, and the European Union points out that it did not designate Pooja Forge an "interested
party" in its regulation regarding the fasteners inv estigation, which it could have done under the last
sentence of Article 6.11.
110 Therefore, because Pooja Forge could not be considered as an "interested
party" in the fasteners investigation, the requirement in Article 6.5 to show "good cause" did not apply
to it.111
69. The European Union emphasizes that this argument "is not pure textualism". 112 Rather, it is
the interpretation that "makes the most sense in li ght of the realities of investigations involving
[NME] countries".113 In NME investigations, authorities must rely on the willingness of third country
producers to cooperate with the investigation, although they have no obligation to do so. The
difficulty inherent in this situation is eviden ced by the fact that the Commission found only two
producers willing to cooperate in the fasteners in vestigation, of which only one, Pooja Forge,
submitted information sufficiently detailed to serve as the basis for the establishment of normal value.
The European Union argues that its investigating authorities have no coercive powers over analogue
country producers, and therefore it would not be prac ticable to apply the requirements of Article 6.5
to these producers. According to th e European Union, having reliable and verifiable third-party data
is a benefit to the investigation, even if that da ta is provided on a confidential basis and without an
assertion of "good cause".114

108European Union's appellant's submission, para. 349.
109European Union's appellant's submission, para. 350.
110European Union's appellant's submission, paras. 352 and 353 (quoting the Definitive Regulation,
supra, footnote 4).
111European Union's appellant's submission, para. 354.
112European Union's appellant's submission, para. 356.
113European Union's appellant's submission, para. 356.

5. The Panel's Findings under Articles 6.2 and 6.4 of the Anti-Dumping
Agreement Regarding the Disclosure of the Identity of the Complainants
70. The European Union requests the Appellate Body to reverse the Panel's determination that
China's claim under Articles 6.4 and 6.2 of the Anti-Dumping Agreement regarding the identity of the
complainants was within its terms of reference. Although the Panel found that the Commission had
not violated these provisions by failing to disclose the identity of the complainants and the supporters
of the complaint, the European Union neverthel ess argues that the Panel should never have made
findings on these claims because they were not include d in China's panel request. In the European
Union's view, Articles 6.4 and 6.2 contain multiple obligations, and it is therefore not sufficient
simply to mention them without further elaboration.
71. Specifically, the European Union claims that China's panel request does not refer to the
identity of the complainants within its claims under Articles 6.2 and 6.4, and the European Union
stresses that, in this case, the mere listing of Ar ticles 6.2 and 6.4 was not sufficient to present the
problem clearly. 115 According to the European Uni on, the Panel mischaracterized the
European Union's argument as claiming that China failed to provide "a brief summary of the legal
basis for a claim under Artic les 6.4 and 6.2". In the European Union's view, "[t]he issue was whether
the way in which the panel request was made presented the problem clearly". 116 Specifically, the
European Union challenges the Panel's interpretation th at "the nature of the rights and obligations set
forth in Articles 6.4 and 6.2 is such that a refere nce to these provisions, without further explanation,
could suffice to put the responding Member on notice of the nature of the clai m that the complainant
might bring".117 It argues that, while the Appellate Body has found that in some instances it may be
sufficient to list the provisions of WTO law under which a complaining party may later develop its
arguments, the Appellate Body has also stated in Korea – Dairy that this would not be appropriate
where the provisions listed contain not just one, distinct obligation, but multiple obligations. 118
According to the European Union, the fact th at China made a claim under both Article 6.2 and
Article 6.4 suggests that at least two obligations are necessarily involved, and that, furthermore, "these
multiple obligations apply in multiple situations in the course of an anti-dumping investigation".119

115European Union's appellant's submission, paras. 365 and 372.
116European Union appellant's submission, paras. 369 and 370.
117European Union's appellant's submission, paras. 378 and 379.
118European Union's appellant's submission, para. 381.
119European Union's appellant's submission, para. 382.

B. Arguments of China – Appellee
1. The Panel's Findings Regarding Article 9(5) of the Basic AD Regulation
"As Such"
72. China requests the Appellate Body to reject th e European Union's appeal and to uphold the
Panel's findings that Article 9(5) of the Basic AD Regulation is inconsistent with Articles 6.10, 9.2,
and 18.4 of the Anti-Dumping Agreement , Article I:1 of the GATT 1994, and Article XVI:4 of the
WTO Agreement.120
(a) The Scope of Article 9(5) of the Basic AD Regulation
73. China submits that the "meaning" or "scope" of Article 9(5) of the Basic AD Regulation is an
issue of fact that the Appellate Body is not competen t to review pursuant to Article 17.6 of the DSU.
However, in the event that the Appe llate Body were to consider itself competent to review this issue,
China submits that the Panel correctly found that Article 9(5) concerns not only the imposition of
anti-dumping duties but also the calculation of dumping margins.121
74. China submits that the issue of the "meaning" or "scope" of Article 9(5) of the Basic AD
Regulation is an issue of fact that can only be revi ewed in an appeal made on the basis of a claim
under Article 11 of the DSU. Therefore, it rejects the European Union's argument that the scope of
Article 9(5) of the Basic AD Regulation is a legal issue and hence subject to appellate review pursuant
to Article 17.6 of the DSU. China contends that, since the "meaning" or "scope" of Article 9(5) was
not clear on its face, the Panel's examination necessar ily involved a factual assessment in relation to
the operation of this provision in practice. As the Appellate Body stated in China – Auto Parts, "there
may be instances in which a panel's assessment of municipal law will go beyond the text of an
instrument on its face, in which case further examin ation may be required, and may involve factual
elements".122 In that dispute, the Appellate Body also cl arified that whenever a panel is required, in
order to determine the meaning of a Member's munici pal law, to "go beyond the text of an instrument
on its face", the Appellate Body will not interfere li ghtly with the factual findings made by the panel
in that respect.123 China recalls that, in the case at issue, th e "meaning" or "scope" of Article 9(5) was
determined by the Panel not solely on the face of th is provision, but also involved factual assessments
regarding its operation in practice. Given that the "meaning" or "scope" of Article 9(5) of the Basic
AD Regulation is an issue of fact and that the European Union failed to raise it under Article 11 of the

122China's appellee's submission, para. 73 (quoting Appellate Body Reports, China – Auto Parts ,
para. 225).
123See China's appellee's submission, para. 74.

DSU as a failure by the Panel to make an objective assessment of the facts, such a factual issue is not
within the scope of the present appeal.
75. China contends that Article 9(5) of the Basic AD Regulation concerns not only the imposition
of anti-dumping duties but also the determination of dumping margins. The fact that Article 9(5) does
not contain the words "margins of dumping" is not sufficient, in China's view, automatically to
conclude that Article 9(5) does not deal with dumping margins at all and relates only to the imposition
of anti-dumping duties. In this regard, China agr ees with the Panel's reasoning that it is necessary to
look at the operation of Article 9(5) as a whole in order to clarify the meaning of that provision and, in
particular, to determine whether it also concerns the calculation of dumping margins even if it does
not expressly say so. The Panel correctly went be yond the mere text of Article 9(5) and also
examined its context and operation, in accord ance with the principles established by the
Appellate Body in US – Corrosion-Resistant Steel Sunset Review and in US – Carbon Steel , in order
to ascertain the meaning of that provision.
124
76. China contests the European Union's assertion that the examination of the context provided by
other articles of the Basic AD Regulation, such as Articles 2, 9(4), and 9(6), confirms that Article 9(5)
relates only to the imposition of anti-dumping duties. However, China notes that none of these other
provisions addresses the issue of whether the dump ing margin for exporters or producers from NMEs
is to be determined on an individual or co untry-wide basis. China disagrees with the
European Union's contention that Article 9(5) of the Basic AD Regulation mirrors Article 9.2 of the
Anti-Dumping Agreement concerning the imposition of duties and the obligation to determine
individual margins of dumping for each known exporte r or producer. Even assuming that this were
correct, China points out that there is no provision in the Basic AD Regulation that mirrors
Article 6.10 of the Anti-Dumping Agreement concerning dumping margin determinations. China
submits that Article 9(4) of the Basic AD Regulation merely sets out the principle that the duty rate
must not exceed the margin of dumping, but does not state how the dumping margin should be
determined, or whether that margin has to be de termined on an individual basis or on a country-wide
basis for exporters from NMEs.
125 China thus contends that Artic le 9(5) is the provision governing
two separate, but very closely related, issues, na mely, the determination of dumping margins and the
imposition of anti-dumping duties. Therefore, meeti ng the five requirements for individual treatment
listed under Article 9(5) not only determines whet her the exporting producer is subject to an

124China's appellee's submission, para. 82 (referring to Appellate Body Report, US – Corrosion-
Resistant Steel Sunset Review, para. 168; and Appellate Body Report, US – Carbon Steel, para. 157).

individual anti-dumping duty but also whether it qualifies for the determination of an individual
dumping margin.
77. China notes that the operation of Article 9(5) of the Basic AD Regulation further confirms
that this provision deals with both the determin ation of dumping margins as well as the imposition of
duties. Contrary to what the European Union asser ts, China contends that whether a Chinese exporter
or producer is entitled to a de termination of an individual dumping margin does not flow from
Article 9(4), which establishes the requirement th at the dumping margin be the ceiling of the anti-
dumping duty, but rather flows from Article 9(5) of the Basic AD Regulation. Indeed, during the
Panel proceedings, the European Union confirmed th at the fact that an exporting producer is a
"non-IT supplier", and therefore does not fulfil the Article 9(5) conditions, implies not only that it will
receive a country-wide anti-dumping duty but also that no individual dumping margin will be
determined for this exporting producer.
126 China recalls that, in order to impose an anti-dumping
duty, the investigating authorities first have to determine a dumping margin, and thus considers it
logical that an individual anti-dumping duty can only be imposed if the underlying dumping margin
was also calculated on an individual basis.
127
78. Thus, China submits that the examination of how Article 9(5) operates in practice clearly
confirms the Panel's conclusion reached on the basis of an analysis of Article 9(5) in the context of the
other provisions of the Basic AD Regulation, name ly, that Article 9(5) deals not only with the
imposition of anti-dumping duties but also with the determination of the dumping margins.128
(b) Article 6.10 of the Anti-Dumping Agreement
79. China submits that the Panel properly concluded that Article 9(5) of the Basic AD Regulation
is inconsistent with Article 6.10 of the Anti-Dumping Agreement because it conditions the calculation
of individual margins for producers from NMEs on the fu lfilment of the IT test. China considers that
the Panel did not err in finding that Article 6.10 of the Anti-Dumping Agreement contains a strict rule
that an individual dumping margin be calculated for each known producer or exporter and that
sampling is the only exception to that rule.129
80. China submits that the use of the word "shall" in the first sentence of Article 6.10 establishes
the mandatory nature of this provision, and contends that if the drafters' intention indeed had been

126China's appellee's submission, para. 98 (referring to European Union's response to Panel
Question 6(a)).

merely to express a preference, as the European Union contends, they would have used the word
"should" instead of "shall". Likewise, they coul d have expressly mentioned that the derogation from
the general rule was permitted in situations othe r than the one mentioned in the second sentence of
Article 6.10. However, the drafters did not use an y such words. In China's view, the expression "as a
rule" is necessary to the extent that it creates a "link between the obligation contained in Article 6.10
first sentence which constitutes the rule and the ex ception to that rule included in the second sentence
of that provision".
130 China asserts that the structure of Article 6.10 confirms the conclusion that the
first sentence contains the main rule ("the authorities shall … determine"), whereas the second
sentence lays down the exception to th at rule ("In cases where … such a determination [is]
impracticable").131
81. China points out that, even in cases where sampling is used, Article 6.10.2 requires
investigating authorities to determine an individua l margin for any exporter or producer not initially
selected who submits the necessary information in time, except when this would be unduly
burdensome to the authorities due to the large num ber of exporters or producers requesting individual
examination. Therefore, Article 6.10.2 confirms th e fundamental importance of the rule that margins
of dumping be determined on an indivi dual basis for each exporter or producer. 132 Indeed, reading
Article 6.10, first sentence, as merely establishi ng a "preference", as the European Union submits,
would mean that investigating authorities are merely invited to determine individual dumping
margins. This conclusion would, in China's view, render the first sentence of Article 6.10 inutile.133
82. China recalls that a finding of the panel in Mexico – Anti-Dumping Measures on Rice
confirmed that sampling is the only exception to the obligation contained in Article 6.10,
first sentence. In that dispute, th e panel stated that "[t]he exception to this rule is the case in which
there are too many foreign producers or exporters so that an individual margin of dumping will only
be calculated for a representative sample".
134 The use of the term "the" preceding the word
"exception" indicates that the panel did not consider the second sentence of Article 6.10 to be merely
an exception among various possible deviations from the rule. China charac terizes the panel reports
cited by the European Union, namely, Korea – Certain Paper and EC – Salmon (Norway) , as
irrelevant to the point at issue, since neither pane l in those disputes attempted to clarify whether the
exception provided in Article 6.10, second sentence, is the only exception to the rule set out in the
first sentence. China also considers that the Eur opean Union's reference to other provisions of the

131China's appellee's submission, para. 121. (original boldface)
134China's appellee's submission, para. 126 (quoting Panel Report, Mexico – Anti-Dumping Measures
on Rice, para. 7.137).

Anti-Dumping Agreement that would "provide investigating au thorities with certain flexibility in the
application of the relevant rules" 135 does not support the European Union's position. On the contrary,
Articles 2.4, 2.5, 5.8, 9.3.1, and 11.4 of the Anti-Dumping Agreement , by including the word
"normally", rather support the view that, if the draf ters had intended not to establish a strict obligation
under the first sentence of Article 6.10, they would ha ve used clearer wording to that effect, just like
they did in the Articles referred to by the European Union.
83. China further asserts that none of the ex amples presented by the European Union
convincingly shows that there are other hypothetical situations, apart from sampling, that may justify
not calculating an individual margin for each known e xporter or producer. Notably, in the case where
an exporter or producer that initially agreed to cooperate decides to cease cooperating in the course of
the investigation, the fact that the dumping margin for that exporter is based on best information
available and, therefore, is de facto the same as the one determin ed for the other non-cooperating
exporters does not render such dumping margin non-individual. 136 Similarly, in the case of an
exporter who has not produced the product concerne d during the period of investigation but merely
"traded" this product, the fact that the investig ating authorities may not calculate an individual
dumping margin for this "trader" does not constitute an exception to Article 6.10, first sentence;
rather, it is a possibility flowing directly from the ge neral obligation in Article 6.10, first sentence, to
determine an individual ma rgin for "each known exporter or producer".137 Lastly, in cases where a
known producer did not export the product concerned during the period of investigation, China notes
that no dumping margin—whether individual or co llective—can be determined for a non-exporting
producer, and once such a producer starts exporting it will receive, pursuant to Article 9.5 of the
Anti-Dumping Agreement , an individual dumping margin unless that producer is related to existing
producers or exporters. 138 China contends that the ot her two examples presented by the
European Union are based on the Eu ropean Union's unilateral practice and therefore are not relevant
to the interpretation of Article 6.10, first sentence.139
84. China also rejects the European Union's alte rnative argument that Article 9(5) of the
Basic AD Regulation is consistent with Article 6.10 of the Anti-Dumping Agreement because it "aims
at identifying the relevant supplier in acco rdance with Article 6.10, first sentence". 140 Indeed, China

135China's appellee's submission, para. 151 (quoting European Union's appellant's submission,
para. 133).
137China's appellee's submission, para. 143. (original boldface)
139China's appellee's submission, paras. 146 and 147.
140China's appellee's submission, para. 165 (quoting European Union's appellant's submission, p. 47,
heading (b)).

contests the European Union's claim that "Article 9( 5) of the Basic Regulation follows the same logic
[as the Korea – Certain Paper test] and seeks to identify the releva nt supplier in the specific context
of imports from non-market economy countries", which is either a Chinese exporter acting
independently from the State (IT supplier), or the State together with related export entities (non-IT
suppliers) that are not acting independently from the State.
141 According to China, the
European Union's anti-dumping practice confirms that the purpose of Article 9(5) is not to identify the
"exporter" or "producer" within the meaning of Artic le 6.10, first sentence. Indeed, China notes that
the IT test provided for in Article 9(5) of the B asic AD Regulation is only applied once the exporters
or producers have been identified by the Commission . Therefore, the ultimate purpose of the IT test
is not, as the European Union asserts, to identify the single supplier of the product under investigation.
If the purpose of the IT test was indeed to identify the relevant supplier, such a test would not be
carried out after the supplier has been identified by the Commission, but rather in order to identify
such a supplier in the first place. China agrees with the Panel's finding that the fact that "the
Commission first determine[s] which, if any, gr oups of companies should be considered as a single
producer or exporter, and then applies the IT test to each 'single' producer or exporter it finds on the
basis of that test … clearly shows that the Commission itself distinguishes the test aimed at
determining whether separate legal entities should be treated as a single exporter/producer for
purposes of dumping determinations, from the IT test under Article 9(5) of the Basic AD
Regulation".
142
85. China further submits that, contrary to the Korea – Certain Paper test, Article 9(5) presumes
that in NMEs all exporters or producers are rela ted to the State and places the burden of proving the
contrary on each exporter or producer, who are re quested to provide evidence of complete fulfilment
of the IT requirements under Article 9(5) in orde r to rebut this presumption. By contrast, under the
Korea – Certain Paper test, it is for the investigating authorities to establish that there is a
"sufficiently close structural and commercial re lationship between indivi dual producers to justify
treating them as a single entity". 143 The Panel, therefore, correctly concluded that the "difference in
the starting points of the two tests, and the different evidentiary burdens involved, … show how
different these two tests are".
144 China also notes that the Commission applies a test similar to the one
in Korea – Certain Paper in all its anti-dumping investigations, irrespective of whether the importing

141China's appellee's submission, para. 173 (referring to European Union's appellant's submission,
para. 142).

country is a market economy or an NME; however, in cases where imports from NMEs are
concerned, the Commission additionally applies the IT test.145
86. China recalls that the European Union justifies the reversal of the burden of proof under the
IT test as compared to the Korea – Certain Paper test on the basis of the mere assertion that there is a
presumption of State control in NMEs. For China, such a presumption lacks an y legal basis. China
notes that there are also many State-owned or State-controlled companies in market economy
countries, and fails to see why such companies receive an individual dumping margin whereas the
same does not apply to the State-owned or State- controlled companies in NMEs. China also notes
that the European Union refers to another presumptio n in order to justify the previous presumption of
"State control", namely, that China is an NME and that the European Union is allowed to treat China
as an NME by virtue of China's Accession Protocol . In this respect, China submits that China's
Accession Protocol merely authorizes certain WTO Members to apply a temporary and limited
derogation from certain rules of the Anti-Dumping Agreement concerning the determination of normal
value, but in no case contains any general acknowledgement that China is an NME. 146 In any event,
China points out that whether China is a market ec onomy or an NME is irrelevant for the purposes of
this case, because the first sentence of Article 6.10 of the Anti-Dumping Agreement does not
distinguish between imports from market economies or NMEs in relation to the determination of
dumping margins. China further notes that the Pa nel expressly and fully addressed this point.
Accordingly, there is no basis for the European Unio n's additional claim that the Panel failed to act in
accordance with its duty under Article 11 of the DSU to make an objective assessment of the facts.147
87. China further asserts that there are im portant differences between the test in Korea – Certain
Paper and the Article 9(5) IT test because the nature of the relationship examined in these tests is
fundamentally different: whereas the Korea – Certain Paper test examines the linkages between
companies, the Article 9(5) IT test focuses on the relationship between companies and the State. For
China, there is a fundamental difference between the examination of the structural and commercial
relationship between different companies and the exam ination under Article 9(5), which relates to the
political influence or interference the State exercises on the way business is conducted by the
exporting producers concerned. 148 The panel in Korea – Certain Paper reached the conclusion that
there was a close structural and commercial re lationship among three companies on the basis of
several factual findings, namely: (i) that the pa rent company had considerable controlling power;
(ii) that there was commonality with respect to company management; (iii) that the companies

harmonized their commercial activities to achieve co mmon corporate objectives; and (iv) that the
parent company acted practically as the sole chan nel for domestic sales. China contends that the
IT test criteria in Article 9(5) relate to elemen ts that are proper to the exercise of a governmental
function in general, rather than to elements relevant to establishing State control, either de jure or
de facto. Indeed, the IT test involves an assessment of whether exporters are free to repatriate capital
and profits, whether export prices are freely determined, whether the majority of shares belong to
private persons, whether exchange rate conversions are carried out at the market rate, and whether
State interference is not such as to permit circum vention of anti-dumping measures when individual
exporters are given different rates of duties. Ther efore, in essence, the nature of the relationship
examined by the IT test is not comparable to the one in Korea – Certain Paper. China further submits
that, even assuming that the IT test criteria were seeking to identify circumstances of State control,
those criteria are so strict that they disqualify Chinese exporters from individual treatment even in
cases where there is no close relationship.
149
88. Lastly, China notes that even assuming that th e European Union seeks to identify a single
exporter or producer by applying the IT test under Article 9(5), no individual dumping margin is
ultimately calculated for the "State". Indeed, the principle that an "individual dumping margin" needs
to be determined for each exporter or producer w ould require that an individual dumping margin be
determined for the "State", that is, the group of companies found not to fulfil the IT conditions.
According to China, the European Union does not determine such an individual dumping margin for
the "State", but rather it determines a country-wid e "residual" dumping margin that is, in most cases,
based on "facts available" and applicable to a ll cooperating non-IT exporting producers as well as to
all non-cooperating exporting producers.150
(c) Article 9.2 of the Anti-Dumping Agreement
89. China submits that the Panel correctly concluded that Article 9(5) of the Basic AD Regulation
is inconsistent with Article 9.2 of the Anti-Dumping Agreement . Article 9.2 requires that
anti-dumping duties be imposed on an individual basis and that a country-wide duty can only be
imposed in the circumstances expressly referred to in Article 9.2, third sentence. Article 9.2, third
sentence, however, does not authorize the automati c imposition of a country-wide duty in the case of
imports from NMEs. Furthermore, the "State" cannot be regarded as a "supplier" or a "source" within
the meaning of Article 9.2 of the Anti-Dumping Agreement.151

90. China submits that the fact that Article 9.2, first sentence, refers to the imposition of
anti-dumping duties with respect to a "product" does not entail an authorization to impose country-
wide duties. In China's view, there is no cont radiction in acknowledging that the imposition of
anti-dumping duties is made with respect to "produ cts" as well as for each "producer" or "exporter"
concerned. Indeed, the panel in EC – Bed Linen stated that "individual dumping margins are
determined for each producer or exporter un der investigation, and for each product under
investigation".152 China agrees with the Panel's interpreta tion of the word "sources" as necessarily
referring to "producers" and/or "exporters" of the product under investigation. This reading finds
support in Article 8 of the Anti-Dumping Agreement , which refers to "sources from which price
undertakings have been accepted", when read in c onnection with Article 9.2, first sentence. By
definition, only exporters—and not countries—may o ffer such price undertakings. China also finds
support for that conclusion in the language of Ar ticle 9.2, itself referring to the "sources found to be
dumped". Since dumping is determined on an indi vidual basis, it follows that "sources found to be
dumped" need to refer to exporters individually found to be dumping. 153 China characterizes the
European Union's reference to the term "injury" in Ar ticle 9.2, first sentence, as entirely irrelevant for
the purposes of determining whether Article 9.2 cont ains the obligation that anti-dumping duties must
be imposed on an individual basis. Whereas the te rm "injury" is a country-wide rather than a
company-specific concept, the panel in EC – Salmon (Norway) pointed out that "[t]he [ Anti-Dumping
Agreement] makes clear that a determination of dumping is individual" even though "a single injury
determination is made in each investigation".154
91. China rejects the European Uni on's reading of the term "appropriate" in Article 9.2, first
sentence, as referring to the "duty rate appropriate to the country concerned", and submits that the use
of the word "appropriate" rather confirms the ru le that anti-dumping duties must be imposed on an
individual basis. The panel in EC – Salmon (Norway) defined the term "appr opriate" as "'proper' or
'fitting' in the context of an anti-dumping investigation".155 In this regard, China notes that the context
of an anti-dumping investigation includes the dete rmination of the dumping margin, which must, as a
rule, be calculated on an individual basis, in accordance with Articles 2 and 6.10 of the Anti-Dumping
Agreement. Therefore, an anti-dumping duty must be deemed to be "appropriate" for a particular
exporting producer when it does not exceed the indi vidual dumping margin determined for that

152China's appellee's submission, para. 224 (quoting Panel Report, EC – Bed Linen, para. 6.118).
154China's appellee's submission, para. 227 (quoting Panel Report, EC – Salmon (Norway) ,
para. 7.128).
155China's appellee's submission, para. 228 (quoting Panel Report, EC – Salmon (Norway) ,
para. 7.704).

exporting producer. China also notes that Article 9. 2, first sentence, provides that an anti-dumping
duty (singular) be collected in appropriate amounts (plural) on imports from all sources.
156
92. With respect to the interpretation of Article 9.2, second sentence, of the Anti-Dumping
Agreement, China submits that the Panel properly found that the obligation "to name" each "supplier"
necessarily implies the obligation to impose anti-dump ing duties on an individual basis. China also
agrees with the Panel's interpretation of the term "suppliers", in the second and third sentences of
Article 9.2, as referring to the individual foreign "p roducers" or "exporters" of the product subject to
the anti-dumping investigation. In this respect, Ch ina rejects the European Union's argument that the
second sentence of Article 9.2 merely imposes an obligation "to name", and that this "naming"
obligation may serve to distinguish between ex porters or producers who are subject to the
anti-dumping duties on that product and those ne w exporters who may request a review under
Article 9.5 of the Anti-Dumping Agreement. China fails to see what utility an obligation to name each
supplier would have if the genera l obligation set out in Article 9.2 was not to determine and impose
the anti-dumping duties on an individual basis.157
93. China points out that Articles 6.10 and 9.4 of the Anti-Dumping Agreement are relevant
context for the purposes of interpreting Article 9.2 and confirming that it contains an obligation to
impose individual anti-dumping duties on each supplier. In China's view, the obligation to determine
individual dumping margins contained in Article 6. 10 would be rendered meaningless if no similar
rule was contained in Article 9.2. In a similar ve in, if, pursuant to the second sentence of Article 9.4,
an individual anti-dumping duty must be imposed on those exporters or producers not included in the
sample to the extent they provided the necessary in formation, it logically follows that an individual
anti-dumping duty must necessarily be determined for those exporters/producers that are included in
the sample (in case sampling is used), as well as a ll the exporters/producers that have provided the
necessary information (if sampling is not used).
158 When Article 9.2 of the Anti-Dumping Agreement
is read in its context it becomes clear that the i nvestigating authorities have the general obligation to
impose anti-dumping duties on an individual basis, and th at the sole exception to that rule is the one
identified in the third sentence of Article 9.2.
94. China contests the European Union's submissi on that the fact "that Article 9.2 does not
require an individual imposition of anti-dumping du ties on all known exporters or producers is also
supported by the purpose of imposing anti-dumping duties", namely, to "offset or prevent

dumping".159 Article VI:2 of the GATT 1994 certainly provides that a Member may levy an
anti-dumping duty on any product fou nd to be dumped and not exceeding the dumping margin in
respect of such a product "in order to offset or prevent dumping"; however, in China's view, this does
not authorize Members to impose anti-dumping duties on the basis of whatever circumstances and
pursuant to any methodology they wish to choose for the calculation of the margin of dumping.
160
95. China agrees with the Panel's in terpretation that the third sentence of Article 9.2 permits the
imposition of country-wide duties when two conditions are met. First, th ere must be "several
suppliers from the same country" and, second, it must be "impracticable to name all these suppliers".
However, China rejects the European Union's interpretation of the term "impracticable" that leads the
European Union to read Article 9.2 as permitting the imposition of anti-dumping duties on a country-
wide basis in cases other than the sampling scenario . China considers that a proper interpretation of
the word "impracticable" in acco rdance with Article 31 of the Vienna Convention on the Law of
Treaties161 (the "Vienna Convention") does not lead to the conclusion, as the European Union submits,
that the exception provided for in Article 9.2, thir d sentence, includes situations where the imposition
of individual duties would be rendered "ineffective" (that is, by actually not offsetting or preventing
dumping). The ordinary meaning of the word "impracticable" is "impossible in practice", but it does
not encompass something that is "ineffective, not f easible or not suited for being used for a particular
purpose".162 China fails to see how something impossible "for practical reasons" would cover
situations where the imposition of anti-dumping duti es on an individual basis would be "ineffective"
for the purpose of offsetting or preventing dumping.
96. China further notes that the word "impractic able" is used in other provisions of the
Anti-Dumping Agreement and in other covered agreem ents. Article 6.10 of the Anti-Dumping
Agreement expressly sets out that it is a "large number of producers or exporters" that makes
individual dumping determinations "imp racticable". It flows from the language of this provision that
"impracticable" is something not feasible "for practical reasons". Similarly, Article 8.3 of the
Anti-Dumping Agreement expressly establishes that an instan ce of impracticability is where "the
number of actual or potential exporters is too great". China notes that, under the Anti-Dumping
Agreement, the word "(im)practicable" is also used in Articles 6.1.1, 6.4, 6.13, 12.2.1, and
paragraph 7 of Annex II thereto, and that in all these provisions this term refers to something which is
(not) possible for practical reasons, and not to someth ing which is (not) effective. Furthermore, the

159China's appellee's submission, para. 239 (quoting European Union's appellant's submission,
para. 164 (original emphasis)).
161Done at Vienna, 23 May 1969, 1155 UNTS 331; 8 International Legal Materials 679.
162China's appellee's submission, para. 249 (quoting European Union's appellant's submission,
para. 172).

word "practicable" appears in Article 22.3 of th e DSU. In this regard, the arbitrators in EC –
Bananas III (Ecuador) (Article 22.6 – EC) emphasized the difference between the meaning of
"practicable" and "effective" by stating that "the ordinary meaning of 'practicable' is 'available or
useful in practice' … . In contrast, the term 'eff ective' connotes 'powerful in effect', 'making a strong
impression', 'having an effect or result'".
163
97. China also contests the European Union's argu ment that, since the purpose of imposing and
collecting anti-dumping duties is to offset or prevent dumping, the imposition of duties on an
individual basis becomes "impracticable" when such imposition renders the duties ineffective because
they do not actually address the "source of pr ice discrimination". China notes that the
European Union fails to explain or define the vague concept of "source of price discrimination", and
recalls that there is no rule in Article VI of the GATT 1994 or the Anti-Dumping Agreement that
addresses it. China further submits that, even if the purpose of the Anti-Dumping Agreement is to
offset or prevent dumping, nothing in the Anti-Dumping Agreement authorizes WTO Members to
impose anti-dumping duties pursuant to any methodology they choose in clear deviation of the
obligation set forth in Article 1 of the Anti-Dumping Agreement, which unambiguously provides that
an anti-dumping measure shall only be applied under the circumstances provided for in Article VI of
the GATT 1994 and pursuant to investigations initiated and conducted in accordance with the
provisions of the Anti-Dumping Agreement .
164 China also notes that, ev en assuming that the word
"impracticable" would mean "ineffective", what is "impracticable" under Article 9.2, second sentence,
is the action of "naming" the suppliers on an indi vidual basis and not the action of "imposing" the
duties on an individual basis. 165 Lastly, although in China's view there is no need to resort to
supplementary means of interpretation w ithin the meaning of Article 32 of the Vienna Convention ,
since the application of customary rules of inte rpretation enshrined in Article 31 do not leave its
meaning ambiguous or obscure and do not lead to a r esult that is manifestly absurd or unreasonable,
the travaux préparatoires confirm the understanding that "impracticable" only relates to the existence
of "several suppliers from the same country" for the purposes of Article 9.2 of the Anti-Dumping
Agreement.
98. In particular, China contends that an examinati on of the negotiating history of Article 8 of the
Kennedy Round Anti-Dumping Code (now Article 9.2 of the Anti-Dumping Agreement) confirms that
the drafters' aim was to clarify whether a Member would be authorized to impose anti-dumping duties
only with respect to those particular exporters f ound to be dumped or, a dditionally, on all imports

163China's appellee's submission, para. 264 (quoting Decision by the Arbitrators, EC – Bananas III
(Ecuador) (Article 22.6 – EC), paras. 70-72).

from the country of origin of the dumped imports. 166 China notes that no refe rence whatsoever to the
specific issue of imports from NMEs can be found in the negotiating history of this provision. In
addition, China submits that the fact that Article 2(g) of the Kennedy Round Anti-Dumping Code
(which incorporates the second Ad Note to Article VI:1 of the GATT 1994) was also discussed, and
eventually included in the Anti-Dumping Code during the Kennedy Round, does not demonstrate that
the second Ad Note and Article 8 necessarily address the same issues. 167 On the contrary, in China's
view, there is no link between the Ad Note and Article 9.2 of the Anti-Dumping Agreement.
99. China agrees with the Panel's interpretation of the terms "sources" and "suppliers" as referring
to "the individual foreign producers or exporters of the product subject to the anti-dumping
investigation".
168 With respect to the European Union's claim that the Chinese State can be deemed
the actual "supplier", China submits that, even if th e State could be regarded as a "supplier", it would
nonetheless be necessary to prove that the State actually "exports" or "produces" the product
concerned. In other words, the fact that the St ate may have some influence on the manner in which
exporting producers conduct their business does not su ffice to establish that the State itself is an
"exporter" or a "producer". Regarding the Europ ean Union's assertion that the term "supplier" can
also refer to the "actual source of price discriminat ion", China submits that there is no legal basis,
either in the wording of Article 9.2 or in the ne gotiating history of that provision, to support such a
conclusion.169
100. China further submits that, even assuming th at the words "source" or "supplier" could
somehow include the concept of "actual source of price discrimination", the Panel correctly found that
the State cannot be presumed to be the source of pri ce discrimination. In China's view, the lack of
any legal basis supporting such a presumption is suffici ent to reject the Europ ean Union's claim and,
therefore, the Panel did not fail to make an obj ective assessment of the matter as required by
Article 11 of the DSU. Notably, the argument that the State in NMEs can be presumed to be the
"source of price discrimination" flows from another presumption, namely, that China is indeed an
NME, which China also contests. Indeed, China recalls that its Accession Protocol does not contain
an understanding that China is an NME but merely c ontains the possibility, limited in time and only
for specific WTO Members, to derogate from the general rules governing normal value determination.

166China's appellee's submission, paras. 274-285.

In China's view, the fact that many countries ha ve expressly acknowledged that China is a market
economy confirms this position.
170
101. China contends that, even assuming that the te rms "suppliers" or "sources" could be read as
referring to the "source of price discrimination", the IT test contained in Article 9(5) of the Basic AD
Regulation does not aim at identifying the "source of price discrimination". Indeed, if this were the
case, there would be no reason for the European Un ion to apply different treatment to market
economies and NMEs. China notes, instead, that, accord ing to the European Union, the influence or
interference by the State in NMEs makes the Stat e the "source of price discrimination", whereas the
same influence or interference by the State in ma rket economies does not make the State the "source
of price discrimination".
171
(d) Article I:1 of the GATT 1994
102. China submits that the Panel properly found that Article 9(5) of the Basic AD Regulation is
inconsistent with Article I:1 of the GATT 1994. Ch ina also submits that the Panel did not fail to
comply with Article 11 of the DSU and that it did not err in finding that the Anti-Dumping Agreement
does not allow for the different treatment of imports from NMEs provided for in Article 9(5) of the
Basic AD Regulation.
103. China agrees with the Panel's conclusion that Article 9(5) of the Basic AD Regulation is
inconsistent with the MFN obligation contained in Article I:1 of the GATT 1994. China contests the
European Union's reading of the word "unconditi onally" as permitting an advantage to be made
available subject to conditions, as long as this does not result in de facto discrimination. Notably, in
Canada – Autos , the panel clearly stated that once an advantage per se has been granted to any
product of a WTO Member, the obligation to accord it "unconditionally" to the like product of any
other WTO Member means that "the extension of that advantage may not be made subject to
conditions with respect to the situ ation or conduct of those countries".
172 In the light of this finding,
subjecting the determination of individual dumpi ng margins and imposition of individual duties (the
advantage granted to all WTO Members that are consider ed market economies) to the fulfilment of
the Article 9(5) IT test requirements (the condition imposed on China) is de jure inconsistent with the
obligation set out in Article 1:1 of the GATT 1994. Only in the hypothetical situation in which the
IT test was meant to apply to all countries—i rrespective of their market economy or NME status—
would it be necessary to prove that Article 9(5) results in de facto discrimination in order to find a

172China's appellee's submission, para. 323 (quoting Panel Report, Canada – Autos, para. 10.18).

violation of Article I:1 of the GATT 1994. China rejects the European Union's assertion that no
discrimination arises under Article 9(5) of the Basic AD Regulation because imports from market
economies are not "like" imports from NMEs. China also contends that whether or not imports from
market economies and NMEs are different in natu re is irrelevant for the purpose of the present
dispute, precisely because the measure at issue is not origin-neutral on its face.173
104. China notes that the Panel addressed the European Union's argument that there is a difference
in the nature of imports from NMEs, which justifi es different treatment. In this respect, the Panel
correctly concluded that the European Union merely asserted that imports from market economies and
NMEs are different in nature, without providi ng sufficient factual evidence to support such a
presumption. Notably, a panel's examination and weighing of the evidence submitted falls within the
scope of the panel's discretion as the trier of the facts 174, and, in this case, the Panel did examine the
evidence before it, but eventually concluded that it was insufficient to support the European Union's
argument.
105. China further submits that the second Ad Note to Article VI:1 of the GATT 1994 does not
reflect a recognition by Members that imports fro m market economies and NMEs are different in
nature. In China's view, the Ad Note does not refer to NMEs but only to countries that have a
complete or substantially complete monopoly of trade and where all domestic prices are fixed by the
State, this not being China's case. Moreover, Chin a recalls that the fact that exporters from NMEs
may be able to show that they act independently from the State casts doubts on the alleged
fundamental difference in nature between imports from market economies and NMEs. China also
points out that nothing in its Accession Protocol ca n be read as an understanding that China is an
NME. China argues that, pursuant to Section 15 of its Accession Protocol, WTO Members are only
entitled to "use a methodology that is not based on a strict comparison with domestic prices or costs in
China"
175 when determining normal value. By no means does Section 15 of China's Accession
Protocol authorize Members to derogate from the principles contained in the Anti-Dumping
Agreement that dumping margins and anti-dumping duties must be determined and imposed on an
individual basis. In any event, China submits th at, even assuming that China's Accession Protocol
would permit WTO Members to treat China as an NM E, this would still fail to demonstrate that
imports from NMEs are different in nature and thus that different treatment is justified.176

174China's appellee's submission, para. 339 (quoting Appellate Body Report, US – Wheat Gluten ,
para. 151).

106. China requests the Appellate Body to uphold the Panel's finding that Article 9(5) of the Basic
AD Regulation violates Article I:1 of the GATT 1994, even in the event it reverses the Panel's
findings under Articles 6.10 and 9.2 of the Anti-Dumping Agreement . China rejects the
European Union's argument that if Article 9(5) is found to be consistent with Articles 6.10 and 9.2 of
the Anti-Dumping Agreement it must, by definition, also be c onsistent with Article I:1 of the
GATT 1994 by virtue of the lex specialis principle contained in the General Interpretative Note to
Annex 1A of the WTO Agreement. China recalls that the panel in EC – Bananas III established that a
conflict only exists where obligations in di fferent agreements cannot be complied with
simultaneously.
177 Thus, it fails to see, in the presen t case, an actual conflict between the
Anti-Dumping Agreement and Article I:1 of the GATT 1994. In China's view, even if the Appellate
Body were to find that the Anti-Dumping Agreement is silent (hence does not expressly prohibit) on
the question of whether investigating authorities ma y use special criteria when examining whether a
country-wide or a company-specific duty must be im posed with respect to imports from NMEs only,
it would still need to examine whether Article I:1 of the GATT 1994 prohibits treating WTO
Members differently when deciding on the imposition of a country-wide or individual duty.178
(e) Article XVI:4 of the WTO Agreement and Article 18.4 of the
Anti-Dumping Agreement
107. China requests the Appellate Body to uphold th e Panel's finding that the European Union
acted inconsistently with Article XVI:4 of the WTO Agreement and Article 18.4 of the Anti-Dumping
Agreement. China submits that, for all the reasons above, the Appellate Body should also find that the
European Union failed to "ensure the conformity of its laws, regulations and administrative
procedures with its obligations as provided in the annexed Agreements", in accordance with
Article XVI:4 of the WTO Agreement. Likewise, the European Uni on failed to "take the necessary
steps, of a general or particular character, to en sure … the conformity of its laws, regulations and
administrative procedures with the provisions of the [ Anti-Dumping Agreement] ", in accordance with
Article 18.4 of the Anti-Dumping Agreement.179
2. The Panel's Findings Regarding Article 9(5) of the Basic AD Regulation,
"As Applied" in the Fasteners Investigation
108. China requests the Appellate Body to uphold the Panel's finding that the EU authorities
violated Articles 6.10 and 9.2 of the Anti-Dumping Agreement with respect to the IT determinations in

177China's appellee's submission, paras. 356 and 357 (referring to Panel Reports, EC – Bananas III ,
paras. 7.159 and 7.160).
178See China's appellee's submission, para. 359.

the fasteners investigation. China submits that a measure that is found to be "as such" inconsistent
with WTO obligations will also necessarily be in consistent "as applied". China notes that the
European Union relies on the fact that all coopera ting companies who requested individual treatment
obtained it to contend that the application of Artic le 9(5) of the Basic AD Regulation did not actually
lead to a denial of the rights contained in the relevant WTO rules, namely, individual treatment.
China stresses that Article 9(5) not only prevents the result that suppliers from NMEs are entitled to
obtain but also subjects them to an additional bur den by requiring such exporters to request and
demonstrate that they fulfil the c onditions laid down in Article 9(5).
180 Therefore, the Panel correctly
concluded that Article 9(5) of the Basic AD Regula tion was inconsistent "as such" with Articles 6.10
and 9.2 of the Anti-Dumping Agreement and, for the same reasons, also inconsistent "as applied" in
this investigation.181
3. The Panel's Findings under Articles 6.4 and 6.2 of the Anti-Dumping
Agreement
109. China requests the Appellate Body to uphold th e Panel's finding that the European Union
acted inconsistently with Article 6.4 of the Anti-Dumping Agreement by not providing timely
opportunities for the Chinese interested parties to see information regarding the product types on the
basis of which normal value was established. In addition, China requests the Appellate Body to
uphold the Panel's finding that the European Union acted inconsistently with Article 6.2 of the
Anti-Dumping Agreement because the Chinese interested parti es were not able to defend their
interests. China requests the Appellate Body to di smiss in its entirety the European Union's appeal
under these provisions.
(a) The "Information" Subject to the Obligations under Articles 6.4
and 6.2 of the Anti-Dumping Agreement
110. China submits that the product types used fo r the determination of normal value were
correctly considered by the Panel as ''informati on'' within the meaning of Article 6.4 of the
Anti-Dumping Agreement.
111. With regard to the interpretation of Article 6.4, China maintains that the ordinary meaning of
the term ''information'' indicates that it is a broad te rm covering any type of knowledge or facts and is
not, as the European Union argues, limited to ''facts and raw data rather than factual determinations

and conclusions by the investigating authorities''.
182 In China's view, this interpretation is confirmed
by the other provisions of the Anti-Dumping Agreement in which the term is used, including
Articles 2.4, 5.2, 8.6, and 11.2. This interpre tation is also confirmed by the panel's finding in Korea –
Dairy that the term "information" in Article 12.2 of the Agreement on Safeguards differs from "issues
of fact and law" in that it is more general.183
112. China argues that none of the prior disputes relied upon by the European Union supports the
interpretation that the term ''information'' is limite d to ''facts and raw data''. The panel's finding in
Korea – Certain Paper (Article 21.5 – Indonesia) merely confirms that the relevant information must
be before the investigating authorities in the re levant anti-dumping proceeding and does not restrict
the meaning of ''information'' to ''raw data''.184 Moreover, the European Union's reliance on the panel's
findings in Korea – Certain Paper is misplaced, because the panel's findings in that dispute actually
support the view that the term ''information'' cove rs also the facts as processed by the investigating
authority.185 As for the panel's finding in US – Oil Country Tubular Goods Sunset Reviews
(Article 21.5 – Argentina), it merely indicates that Article 6.4 applies to ''information'' as opposed to
the ''reasoning'', but does not suggest that the information is limited to raw data and facts. 186 China
further argues that, in EC – Tube or Pipe Fittings , the Appellate Body did not assimilate the term
"information" under Article 6.4 as "raw data", as the European Union argues 187, but merely noted the
panel's factual finding that the authority's reasoning, as well as certain raw data, had not been
disclosed to the interested parties.
188 In addition, the information f ound to be covered by Article 6.4
in that dispute contained data that had been treat ed, aggregated, and summarized by the investigating
authority, as well as the authority's evaluation of th ese data. China adds that the "information" found
to be subject to Article 6.4 in EC – Tube or Pipe Fittings is thus similar to the product types in the
fasteners investigation, which are categories of pr oducts established on the basis of raw data provided
by the Indian producer, Pooja Forge.
113. China contends that the word "relevant" in Article 6.4 supports the interpretation that
"information" under Article 6.4 is not limited to ra w data and facts but any types of facts that the

182China's appellee's submission, para. 380 (quoting European Union's appellant's submission,
para. 253).
183China's appellee's submission, para. 379 (quoting Panel Report, Korea – Dairy, para. 7.125).
184China's appellee's submission, paras. 391 (quoting Panel Report, Korea – Certain Paper
(Article 21.5 – Indonesia), para. 6.82) and 392.
185See China's appellee's submission, para. 393 (referring to Panel Report, Korea – Certain Paper ,
para. 7.201).
186China's appellee's submission, para. 394 (quoting Panel Report, US – Oil Country Tubular Goods
187See European Union's appellant's submission, para. 254.
188China's appellee's submission, para. 395 (referring to Appellate Body Report, EC – Tube or Pipe
Fittings, paras. 138-141).

interested parties consider relevant to the presentatio n of the case. As for the context provided by the
other paragraphs of Article 6, China argues that the European Union has erroneously tried to create an
artificial division between the scope of the different ob ligations in Article 6, and appears to argue that
there can be no overlap between such obligations. In China's view, there is a certain overlap between
the different paragraphs of Article 6 and, in certain cases, one set of facts can give rise to a violation
of several due process obligations. Specifically, the European Union's assertion that Articles 6.1
to 6.3 of the Anti-Dumping Agreement address only the right to submit a party's own evidence and
arguments is incorrect in the light of the text of these provisions. This assertion also ignores the
intertwined nature of a party's right to make submissions and its right to be informed of what the other
interested parties submit.
114. In addition, China contends that the repeated re ference to Article 6.5 in the other paragraphs
of Article 6 illustrates the interrelated nature of the rights and obligations under Article 6, and
undermines the artificial distinctions that the Eu ropean Union has tried to draw among different
paragraphs of Article 6. Furthermore, recalling its view that the term "information" in Article 6.4 has
a broad connotation and may also incl ude data that has been treated or organized by the investigating
authority, China submits that the term "information" in Article 6.4 covers an even wider scope than
"essential facts under consideration" in Article 6.9. Therefore, China argues, the distinction drawn by
the European Union between "information" in Artic le 6.4 and "essential facts under consideration" in
Article 6.9 is baseless. Finally, China submits th at it would frustrate the object and purpose of the
important obligations contai ned in Article 6 of the Anti-Dumping Agreement if the scope of the term
''information'' were to be interpreted restrictively, thereby depriving interested parties of their essential
due process rights. In China's view, the sole limit ations to the right granted in Article 6.4 are
expressly laid down in the provision itself.
115. Turning to the facts of the fast eners investigation, China finds it ''rather absurd'' that the
European Union seems to be arguing that the ''pro duct types'' only need to be ''disclosed by the
investigating authorities as 'essential facts' under Article 6.9''.
189 The European Union's argument
would imply that, until the disclosure of the "essential facts" towards the end of the investigation, the
interested parties would have no way of knowing th e basis on which the products used for the normal
value determination have been gr ouped into "product types". China argues that this would result in
the interested parties not only being unable to comment on the appropriateness of the product
categories but also, not knowing the physical characteristics of the product types, being unable to
request adjustments pursuant to Article 2.4 of the Anti-Dumping Agreement . China adds that this
would also be inconsistent with the requirement, in paragraph 151 of the Report of the Working Party

on the Accession of China to the WTO (C hina's "Accession Working Party Report")
190, that the
process of investigation be transparent and that sufficient opportunity be given to Chinese producers
and exporters to make comments.
(b) Whether the "Information" Was Made Available to the Interested
Parties in a "Timely" Manner within the Meaning of Article 6.4 of
the Anti-Dumping Agreement
116. China maintains that the European Union fa ils to demonstrate that the Panel acted
inconsistently with Article 11 of the DSU in its as sessment of the facts in relation to its finding that
the European Union failed to make information av ailable on a timely basis. China argues that the
evidence referred to by the European Union was not deliberately disregarded by the Panel, and that, in
any event, the conclusions the European Union dr aws from these pieces of evidence are incorrect and
irrelevant.
117. China maintains that, during the Panel proceedi ngs, the European Union did not refer to the
Information Document in rebuttal of China's claim th at the European Union acted inconsistently with
Articles 6.2 and 6.4 of the Anti-Dumping Agreement. Rather, before the Panel, the European Union
argued that the Information Document should not be taken into account because it was "an informal
document that simply reflects a work in progress and has no legal status whatsoever in EU law or in
the context of the Anti-Dumping Agreement."
191 Therefore, there is no basis for the
European Union's assertion that the Panel disr egarded the Information Document, when the
European Union itself did not claim that this document constituted relevant evidence.
118. In any event, China considers that the Information Document should not lead to a conclusion
different from that reached by the Panel. The parity of wording between the General Disclosure
Document and the Information Document regarding ''product types'' does not, in China's view, detract
from the Panel's conclusion on this issue for two main reasons. First, the relevant wording was a mere
statement by the European Union that it had dete rmined the normal value ''per product type''.
However, in China's view, this did not change the impression by the Chinese producers since the mere
reference to ''product types'' was made without clear ly stating that these product types were different
from the product types constructed on the basis of th e full PCNs. Considering the consistent practice
of the European Union in previous investigations to make the comparison on a PCN basis, this was
not sufficient information to draw the necessary c onclusions that there was a difference between the
"product types" and the PCNs.

190WT/ACC/CHN/49 and WT/ACC/CHN/49/Corr.1.
191China's appellee's submission, para. 473 (quoting European Union's second written submission to the
Panel, para. 120).

119. Second, China maintains that neither the Information Document nor the General Disclosure
Document was specific enough to allow a Chinese producer to know on which basis the comparison
would be made. The General Disclosure Document did not provide any information as to the relevant
characteristics of those product groups, or how they were determined, and the same applies to the
Information Document. China argues that the ''fact ual context supports an interpretation that the use
of such ambiguous wording by the Commission was intentional" 192, as further illustrated by the very
ambiguous reply of the Commission to the two Chinese exporters who had doubts regarding the
comparison and requested clarification. To Chin a, it was only when these exporters made a second
request that the Commission clearly stated that the product types had not been constructed on the
basis of the full PCNs, but were instead establis hed on the basis of the strength class and the
distinction between standard and special fasteners.
120. China further contends that, even assuming that the Chinese producers had been informed of
the use of product types by either the Information Document or the General Disclosure Document,
this would be irrelevant to the examination of wh ether the European Union complied with Article 6.4
of the Anti-Dumping Agreement. Article 6.4 requires an authority to provide "timely opportunities" to
see the information requested by the interested parties. In the fasteners investigation, the Commission
did not inform the Chinese interested parties about the basis of its normal value determination until
one working day before the deadline to make comments, following two requests by the Chinese
interested parties. Thus, the Panel's finding that the investigating authorities provided ''timely
opportunity'' to see the information requested is pr operly supported by the relevant evidence on the
record.
121. China submits that the contention put forward by the European Union regarding the ability of
Chinese producers to make presentations on the b asis of the ''information'' provided by the
European Union was rightly dismissed by the Panel as irrelevant to its analysis under Article 6.4 of
the Anti-Dumping Agreement . The comments by certain Chinese exporters referred to by the
European Union were, according to China, made in a context that was completely unrelated to the
determination of the product types that would be used for the comparison between normal value and
export price. China submits that the Panel consider ed these ''presentations'' but rightly concluded that
they were irrelevant to the assessment of China's claim under Article 6.4.
122. With respect to the letter of 24 November 2008
193, in which one of the Chinese interested
parties who requested information concerning produc t types commented on this ''information'', China

193Panel Exhibit EU-12, supra, footnote 82.

disagrees with the European Union that this piece of evidence indicated that a ''timely opportunity''
had been provided. China maintains that the c ontent of the information given to the Chinese
interested parties was not sufficient to enable a substantiated claim for additional adjustments.
Specifically, the European Union did not provide the list of ''product types'' and their correlation with
the PCNs, even though such information had been requested. Furthermore, no precise information
regarding the distinction between special and sta ndard fasteners was provided by the Commission.
China submits that the fact that the Chinese produ cer did not request an extension is irrelevant,
because it was for the Commission to provide the in formation in a timely manner, and not for the
interested parties to try to gain additional time. Thus, the Panel rightly decided not to rely on this
letter in reaching its finding.
(c) The Panel's Finding under Article 6.2 of the Anti-Dumping
Agreement
123. China submits that, although the European Unio n claims that the Pa nel's consequential
finding under Article 6.2 is erroneous, it does not prov ide any additional arguments other than those it
has provided in its arguments under Article 6.4 of the Anti-Dumping Agreement. Moreover, contrary
to the European Union's assertion, the Panel did not r ead the obligation of Article 6.4 into Article 6.2,
thus collapsing both provisions. Rather, even t hough there might be provisions more specific than
Article 6.2 that govern a certain claim, it may be necessary for a panel to also address the claims
under Article 6.2.
124. China further contends that the European Union's characterization of the Panel's finding under
Article 6.2 as "purely consequential"
194 is erroneous. Rather, the Panel found a violation of
Article 6.2 that was independent from Article 6.4, on the basis of the fact that the Chinese producers
were denied a full opportunity for the defence of their interests because the Commission provided
information concerning the product types used in the determination of the normal value only at a very
late stage of the proceedings. Thus, according to China, the Panel found a twofold violation of
Article 6.2: (i) the consequential violation resultin g from Article 6.4; and (ii) a separate violation
resulting from the Commission's failure adequately to provide information that would have allowed
the Chinese producers to defend their interests in the investigation.

194China's appellee's submission, para. 505 (quoting European Union's appellant's submission,
paras. 236, 244, 247, and 275).

(d) Conclusion
125. On the basis of the above arguments, China requ ests the Appellate Body to uphold the Panel's
findings that the European Union acted incons istently with Articles 6.2 and 6.4 of the Anti-Dumping
Agreement with respect to aspects of the normal value determination, and in particular the information
on "product types", their characteristics, and their relationship with the PCNs.
4. The Panel's Findings under Articles 6.5 and 6.5.1 of the Anti-Dumping
Agreement Regarding Non-Confidential Questionnaire Responses
126. China requests the Appellate Body to uphold th e Panel's findings that the European Union
acted inconsistently with Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement with respect to the
non-confidential questionnaire responses of domestic producers, and the confidential treatment of
Pooja Forge's questionnaire responses. Specifically, China agrees with the Panel that Article 6.5.1
requires investigating authorities to ensure th at parties provide "appropriate" non-confidential
summaries of information submitted in confidence, or, in exceptional circumstances, "appropriate"
statements of reasons explaining why summarization is not possible. China further maintains that the
Panel rightly determined that it could make findings on China's cl aims regarding the questionnaire
responses of Pooja Forge. On the substance of this claim, China asserts that Article 6.5 applies to
analogue country producers because they can be considered "parties to an investigation", or, in the
alternative, because the European Un ion created a new class of "inter ested parties" when it employed
an alternative method of determining normal value using analogue country producers.
(a) Non-Confidential Summaries of Domestic Producers' Questionnaire
Responses
127. China agrees with the Panel that Article 6.5.1 of the Anti-Dumping Agreement requires an
investigating authority to ensure that, where inform ation provided in confidence is not susceptible to
non-confidential summary, an "appropriate" statemen t of reasons explaining why summarization is
not possible is required. According to China, Artic le 6.5.1 entails a two-part obligation. First,
Article 6.5.1 obliges an investigating authority to require non-confidential summaries of confidential
information, or, where applicable, statements of the reasons why summarization is not possible.
Second, an investigating authority must require that these summaries or statements be "appropriate" to
satisfy Article 6.5.1.
195 In China's view, interpreting this pr ovision in a way that would allow less
than "appropriate" compliance with its terms woul d render the obligation useless and would violate a

corollary to the general rule of interpretation th at an interpreter should not adopt a reading that
reduces the provisions of treaty "to redundancy or inutility".
196
128. China reminds the Appellate Body that, as sever al panel reports have already recognized, the
Anti-Dumping Agreement is aimed at WTO Members, not private parties 197, and it is for the
investigating authority of a Member, therefore, to determine whether a party has substantiated its
claim that summarization of confidential information is not possible. 198 China disagrees with the
European Union that authorities are not given a "stick" 199 with which to enfor ce such an obligation,
and suggests that both Article 6.5.2200 and Article 6.8201 allow authorities to disregard information that
is not submitted in compliance with Article 6.5 as a whole. Furthermore, China contends that the
European Union's obligations under Article 6.5.1 are not affected by the fact that Chinese exporters
did not affirmatively request improved summaries
202, or by the fact that exporters were able to make
presentations on the issues to which the confiden tial information related without having received
improved summaries.203
129. Contrary to the European Union's interpretati on, China argues that Article 6.5 is only one
aspect of the overall transparency requirement cont ained in both Articles 6.5 and 6.5.1, and that
Article 6.5.1 "narrowly circumscribes" the right to confidential treatment. 204 Therefore,
notwithstanding the protection of confidentiality, interested parties must be given access to non-
confidential summaries of confidential information in order to allow them the exercise of their basic
procedural rights. Only in the exceptional circ umstance that summarization is not possible can one
derogate from the obligation to provide a non-conf idential summary. In China's view, if these
conditions are not met, confidential treatment must be denied or the information must be
disregarded.
205 Read within the overall framework of Article 6, then, confidential treatment is rather
an exception to the main objective to ensure that interested part ies have a full opportunity for the
defence of their interests.206

196China's appellee's submission, paras. 523 and 524.
199China's appellee's submission, para. 530 (quoting European Union's appellant's submission,
para. 321).
204China's appellee's submission, paras. 537 and 538.
206China's appellee's submission, paras. 540 and 541.

130. China further submits that the language of Article 6.5.1—that authorities "shall require"
non-confidential summaries, and that these summaries "shall be" sufficiently detailed—does not
suggest only a "best endeavours" obligation. Rather , Article 6.5.1 contains "an obligation to achieve
the required result, irrespective of the nature of the endeavours undertaken by the investigating
authorities".207 But even if Article 6.5.1 did contain a "b est endeavours" obligation, China argues that
the European Union still failed to comply with it. The panel in Egypt – Steel Rebar analyzed what is
meant by a party's "best endeavours", and found that the term "connotes efforts going beyond those
that would be considered 'reasonable' in the ci rcumstances" and implies a "high level of effort". 208
While the Commission may have requested th at domestic producers submit non-confidential
summaries, it did not do so with respect to the provision of statements of reasons explaining why
summarization was not possible in the case that no summary was provided. 209 China urges the
Appellate Body to accept the findings of the panel in Mexico – Olive Oil , which held that an
investigating authority should examine a party's reasons for not summarizing confidential information
to determine whether they constitute exceptional circumstances. 210 It also disputes the
European Union's reading of that case as factually distinguishable from the fasteners investigation.211
(b) Confidential Treatment of Information Obtained from Pooja Forge
(i) Terms of reference and due process
131. In response to the European Union's terms of reference challenge, China requests the
Appellate Body to uphold the Panel's findings that China's claims regarding Pooja Forge's
questionnaire responses were properly before it. The European Union did not raise this claim before
the Panel, and China contends that the European Union therefore waived its right to have this
objection heard before the Appellate Body. 212 China cites the Appellate Body Report in Mexico –
Corn Syrup (Article 21.5 – US) for the proposition that a Member who "fails to raise objections in a
timely manner, notwithstanding one or more opportuniti es to do so", may be deemed to have waived
its rights to have a panel consider such objections.213
132. Even if the Appellate Body finds that the Europ ean Union did not waive its right to raise this
objection on appeal, China argues that its cl aim under Article 6.5 regarding Pooja Forge's

208China's appellee's submission, para. 551 (quoting Panel Report, Egypt – Steel Rebar, para. 7.244).
210China's appellee's submission, para. 557 (quoting Panel Report, Mexico – Olive Oil, para. 7.92).
213China's appellee's submission, para. 574 (quoting Appellate Body Report, Mexico – Corn Syrup
(Article 21.5 – US), para. 50).

questionnaire responses was within the panel's terms of reference. In China's view, its panel request
satisfied the requirements of Article 6.2 of the DS U because the legal basis of the claim was clear.
China observes that the Appellate Body has drawn a distinction between "claims" and "arguments"
214,
and maintains that Article 6.2 theref ore does not require it to explain " why and how the measure at
issue violates the provisions" listed in the panel request.215 By including certain of its arguments in its
panel request, China asserts that it merely foreshad owed arguments that it would later develop in its
submissions before the Panel, and that this ca nnot be interpreted as narrowing the scope of its
claim.216 Furthermore, China explains, the reference in its panel request to "domestic producers" only
related to its claims under Article 6.5.1, and not to its claims under Article 6.5, which the Panel found
to have been violated with regard to the qu estionnaire responses submitted by Pooja Forge on a
confidential basis.217 Finally, China notes that the sufficiency of a panel request under Article 6.2 of
the DSU entails a two-stage test , articulated by the panel in EC – Bed Linen as follows: "first,
examination of the text of the request for establishm ent itself, in light of the nature of the legal
provisions in question; second, an assessment of wh ether the respondent has been prejudiced by the
formulation of claims in the request for estab lishment, given the actual course of the panel
proceedings."218 China claims that the European Union's fa ilure to even raise this claim before the
Panel confirms that its ability to defend its interests was not prejudiced.
133. Regarding the European Union's alternative clai m, China points out that the Panel examined
the issue of due process and sufficiently addressed th e European Union's concerns when it dealt with
this claim. Having determined that China had not offered arguments or evidence relating to any
category of information besides "product types", th e Panel limited China's claims with regard to
Pooja Forge to the confidential information relating to this category only. 219 In any event, China
submits that the Panel did not make the case for Ch ina, and highlights several submissions made by
China to the Panel, which it argues were suffici ent for the Panel to have reached the finding it
ultimately made. These submissions were not limited to responses to the Panel's questions, moreover,
but also consisted of the submission of the non-c onfidential version of Pooja Forge's questionnaire
responses itself, as well as arguments China made in its second written submission to the Panel. 220
Finally, in China's view, the European Union was not deprived of an "adequate opportunity" to

214China's appellee's submission, para. 578 (quoting Appellate Body Report, Korea – Dairy, para. 139;
and Appellate Body Report, EC – Bananas III, para. 141).
218China's appellee's submission, para. 585 (quoting Panel Report, EC – Bed Linen, para. 6.26).
220China's appellee's submission, paras. 591 and 592.

respond to China's claims. Rather, the European Union chose not to respond because it felt the claim
"should be dismissed without entering into the substance".221
(ii) Application of Article 6.5 to analogue country producers
134. China disagrees with the European Uni on's claim that Article 6.5 of the Anti-Dumping
Agreement did not apply to Pooja Forge because it was not an "interested party". China argues that
Article 6.5 applies expressly to "parties to an in vestigation", which is a broader concept than
"interested parties" as defined in Article 6.11, and would include analogue third country producers
participating in the investigation. This interpre tation is supported by the subsequent use of more
general terms, such as "a person supplying the information" and "the supplier of the information". 222
China claims that the consistent use of a term othe r than "interested parties" leads to the conclusion
that a different meaning is intended, and that ther efore Pooja Forge did not need to come within the
definition of "interested parties" to be considered a "party to the investigation".223 China observes that
Pooja Forge submitted an extensive amount of data, that this data was used by the Commission as the
basis for calculating normal value, and that the Co mmission even visited Pooja Forge in order to
verify such data.224 Therefore, in China's view, Pooja Forge "took part in" the fasteners investigation,
and should be considered a "party to the investigation".225
135. In response to the European Union's argument that it does not make sense, in the light of the
realities of NME anti-dumping inves tigations, to apply the requireme nts of Article 6.5 to analogue
country producers, China asserts that the opposite is true. In China's view, investigating authorities
enjoy a high margin of discretion in determini ng normal value in the context of investigations
involving NME countries, and, therefore, it is even more important that the process be as transparent
as possible, and that sufficient opportunity be given to Chinese producers to view and make
comments on information relating to normal value.226
136. Even if the Appellate Body determines that Artic le 6.5 applies only to "interested parties", as
defined by Article 6.11, China suggests that Pooja Fo rge should be considered an "interested party" in
the fasteners investigation. The Appellate Body in Japan – DRAMs (Korea) found that "interested
parties" should also include those entities whose pa rticipation is relevant "for carrying out an
objective investigation and for obtaining information or evidence relevant to the investigation at

226China's appellee's submission, para. 606 (quoting China's Accession Working Party Report,
para. 151).

hand"
227, and China contends that an analogue producer falls directly within the Appellate Body's
description. China further argues that the Eur opean Union itself designated Pooja Forge as an
"interested party", for purposes of Article 6.5, by including in documents intended solely for analogue
country producers instructions on submitting confidential information in compliance with Article 6 of
the Anti-Dumping Agreement.228
5. The Panel's Findings under Articles 6.2 and 6.4 of the Anti-Dumping
Agreement Regarding the Disclosure of the Identity of the Complainants
137. China counters the European Union's terms of re ference challenge regarding the disclosure of
the identity of the complainants under Articles 6.4 and 6.2 of the Anti-Dumping Agreement by
pointing out that the European Union fails to di stinguish between "claims" and "arguments", and
thereby identifies the wrong standard for determin ing whether a panel request summarizes the legal
basis of the complaint in a way that is "sufficient to present the problem clearly". 229 China urges the
Appellate Body to follow the standard developed in previous Appellate Body reports, which, in its
view, requires that "the identification of the legal ba sis of the claim must shed light on the nature of
the obligation at issue so that the respondent is able to defend itself".230
138. China argues that it "precisely" identified its clai m when it stated in its panel request that the
measure at issue violated Articles 6.4 and 6.2 of the Anti-Dumping Agreement "because the
[European Union] failed to ensure throughout the investigation to Chinese producers/exporters the full
opportunity for the defense of their interests and fail ed to provide timely opportunities for them to see
all information that is relevant to the presentation of their cases". 231 According to China, this was
sufficient to identify its "claims", and China had no obligation to include "arguments" explaining how
the European Union had violated its obligations. Moreover, the fact that China did include several
arguments in its panel request should not be interp reted as limiting the scope of its claims to those
arguments only.232 Furthermore, China disagrees with the European Union that its panel request was
not specific enough to "present the problem clearly", because Articles 6.4 and 6.2 together contain
multiple obligations. With regard to Article 6. 2, China emphasizes that it included only the first

227China's appellee's submission, para. 608 (quoting Appellate Body Report, Japan – DRAMs (Korea),
para. 242).
228China's appellee's submission, paras. 609-611.
229China's appellee's submission, paras. 626-628.
230China's appellee's submission, para. 633 (referring to Appellate Body Report, EC – Bananas III ,
para. 141; Appellate Body Report, US – Carbon Steel , para. 130; and Appellate Body Report, Korea – Dairy,
paras. 124 and 127)..
232China's appellee's submission, paras. 635-638 (quoting Appellate Body Report, EC – Selected
Customs Matters, para. 153).

sentence of this provision in its claim, and did not intend to invoke the entire Article. 233 China
contends that, while there may be multiple ways in which these provisions can be violated, the same is
true for all provisions of the Anti-Dumping Agreement, and does not imply that each contains multiple
obligations.234
139. Finally, China contends that the Appellate Body 's examination of the sufficiency of a panel
request must take into account whether or not a respondent's ability to defend itself "was prejudiced,
given the actual course of the proceedings". 235 In China's view, "irresp ective" of whether China's
panel request complied with Article 6.2 of the DSU, the European Union cannot succeed in a terms of
reference challenge unless it successfully demonstrates such prejudice. 236 Given the unambiguous
statement of China's claims in its first written submission to the Panel, and in its subsequent
clarifications in response to the Panel's questions, China insists that the European Union cannot show
that its ability to defend itself was prejudiced in this case.237
C. Claims of Error by China – Other Appellant
1. The Panel's Findings under Articles 4.1 and 3.1 of the Anti-Dumping
Agreement
140. China requests the Appellate Body to reverse th e Panel's finding that the European Union did
not act inconsistently with Articles 4.1 and 3.1 of the Anti-Dumping Agreement with respect to the
definition of the domestic industry in the fasteners in vestigation. First, China alleges that the Panel
erred in finding that the European Union did not act inconsistently with Articles 4.1 and 3.1 of the
Anti-Dumping Agreement by excluding from the definition of the domestic industry producers who
did not support the complaint against injurious dumping and producers that made themselves known
more than 15 days after the publication of the Notic e of Initiation of the investigation. In addition,
China asserts that the Panel erred in rejecting China' s claim that the domestic industry in the fasteners
investigation, comprising producers accounting for 27 per cent of total estimated EU production of
fasteners, did not include producers whose collec tive output "constitutes a major proportion of the
total domestic production" within the meaning of Article 4.1 of the Anti-Dumping Agreement .
Finally, China claims that the Panel erred in finding that the European Union did not act
inconsistently with Articles 4.1 and 3.1 of the Anti-Dumping Agreement by making an injury

235China's appellee's submission, para. 632 (quoting Appellate Body Report, Korea – Dairy, para. 127).
237China's appellee's submission, paras. 654-658.

determination on the basis of a sample of producer s that was not representative of the domestic
industry.
(a) Exclusion of Certain Producers
141. China claims that the Panel failed to conduct an objective assessment of the facts, as required
by Article 11 of the DSU and Article 17.6 of the Anti-Dumping Agreement , in finding that the
European Union did not exclude producers that did not support the complaint from the definition of
domestic industry. China further argues that the Pane l erred in its interpretation of Article 4.1 of the
Anti-Dumping Agreement , and acted inconsistently with Article 11 of the DSU, in finding that the
European Union did not violate Article 4.1 of the Anti-Dumping Agreement by excluding from the
definition of domestic industry the producers that did not come forward within 15 days of the
initiation of the anti-dumping investigation. Chin a also submits that the Panel erred in its
interpretation of Article 3.1 of the Anti-Dumping Agreement by rejecting China's claim under that
provision simply because it had rejected China's claim under Article 4.1 of that Agreement.
(i) Exclusion of producers who did not support the complaint
142. China recalls the Appellate Body's finding in respect of Article 11 of the DSU that "the
question whether a panel has made an 'objective assessment' of the facts is a legal one, that may be the
subject of an appeal."
238 Moreover, the Appellate Body has found that, in carrying out its mandate
under Article 11 of the DSU, "a panel has the duty to examine and consider all the evidence before it,
not just the evidence submitted by one or the other party, and to evaluate the relevance and probative
[force] of each piece thereof." 239 The Appellate Body has also emphasized that panels cannot make
affirmative findings that lack a basis in the evidence contained in the panel record.240
143. Turning to the facts of this case, China submits that it claimed before the Panel that the
European Union erroneously excluded from the defi nition of the domestic industry all producers who
did not support the complaint regarding the alleged injurious dumping caused by imports of fasteners
from China. The Panel, however, failed to con duct an objective assessment of the facts, and
erroneously found that the Commission did not exclude producers unsupportive of the complaint from
the definition of the domestic industry. China a lleges that, in reaching its finding, the Panel relied
solely on the European Union's factual assertion that at least one producer who did not affirmatively

238China's other appellant's submission, para. 46 (quoting Appellate Body Report, US – Wheat Gluten,
para. 151 (original emphasis); and referring to Appellate Body Report, EC – Hormones, para. 132).
239China's other appellant's submission, para. 50 (quoting Appellate Body Report, Korea – Dairy ,
240China's other appellant's submission, para. 50 (referring to Appellate Body Report, US – Carbon
Steel, para. 142, in turn referring to Appellate Body Report, US – Wheat Gluten, paras. 161 and 162).

state support for the complaint at the pre-initiation stage was included in the definition of the domestic
industry. According to China, this assertion of the European Union was not substantiated by
evidence, even though evidence in this regard "was clearly accessible to the [European Union] as
investigating authorities". 241 For example, the European Union could have provided the list of the
complainants and supporters who had come forward before the initiation. Yet, in response to the
concern raised by China concerning the reliability of th is statement, the Panel stated that it "ha[d] no
reason to doubt the European Union's assertion of fact in this regard". 242 Therefore, China submits,
"by treating as an established fact a mere assertion made by the [European Union] without supporting
evidence, the Panel committed an egregious erro r and therefore failed to make an objective
assessment of the facts as required by Article 11 of the DSU".
243
144. China further maintains that the Panel "disre garded the explanation put forward by China" 244,
as well as other relevant evidence, which showed that the Commission knew whether the producer
who had allegedly remained silent before initiation of the investigation in fact supported the
complaint. China submits that, as indicated by th e European Union's response to a question posed by
the Panel, the Commission enquired into the positio n of all known producers regarding the complaint
and, consequently, must have been aware of the position of the producer who had allegedly remained
silent prior to initiation but was included in th e domestic industry definition subsequent to
initiation.245 Moreover, the Information Document, which was issued by the Commission several
months before concluding the i nvestigation, made it clear that the Commission enquired into, and
knew, the position of all known producers regarding the complaint. In "ignoring" 246 such evidence,
the Panel failed to make an objective assessment, as required by Article 11 of the DSU, when it found
that the fact asserted by the European Union, th at a producer who had remained silent in the
pre-initiation stage was included in the definition of the domestic industry, necessarily demonstrated
that the Commission did not exclude producers unsupportive of the complaint.
145. China asserts, furthermore, that the Panel act ed inconsistently with Article 11 of the
DSU because it "ignored" the following three piec es of evidence submitted by China demonstrating
that the European Union excluded from the domestic industry definition all producers unsupportive of
the complaint.247 Specifically, recital 114 of the Defin itive Regulation defines the domestic industry

241China's other appellant's submission, para. 65.
242China's other appellant's submission, para. 63 (quoting Panel Report, footnote 473 to para. 7.214).
243China's other appellant's submission, para. 66.
244China's other appellant's submission, para. 69.
245China's other appellant's submission, para. 82 (refe rring to European Union's responses to Panel
Questions 88 and 89).
246China's other appellant's submission, para. 82.
247China's other appellant's submission, para. 85.

as 45 EC producers who "supported the complaint and fully cooperated in the investigation". The
Panel acknowledged that the wording of the De finitive Regulation meant that "only producers
expressing support for the complaint were included in the domestic industry".
248 However, the Panel
"disregarded the unambiguous wording" of the De finitive Regulation in its assessment of facts 249, and
failed to explain why it did not consider this evidence relevant to its finding.
146. In addition, China maintains th at, before the Panel, it referred to the Information Document
issued by the Commission half a year before the publication of the Definitive Regulation, in which the
Commission explained its preliminary determinations in the fasteners investigation. China argues that
the Information Document shows that the domestic industry was initially defined as comprising only
the 86 producers who supported the complaint and fu lly cooperated in the investigation. However,
the Panel decided not to rely on the Information Document, finding that it was "a working document
reflecting progress in the investigation to that point, with no legal status in EU law", and thus did not
constitute "part of the measure" at issue before the Panel. 250 According to China, the Panel
erroneously disregarded this eviden ce, because the Information Document is part of the record of the
investigation and a relevant piece of evidence. Finally, China contends that it submitted to the Panel a
letter sent by the Commission in response to two Chinese producers' requests for clarification
regarding certain aspects of the General Disclosure Document. 251 In the letter, the Commission stated
that the volume of production of the Community industry indicated in the General Disclosure
Document corresponded to "the Community producers that supported the complaint and fully
cooperated in the investigation".
252 In China's view, this eviden ce demonstrates that only producers
supporting the complaint were included in the domes tic industry definition. The Panel, however, did
not refer to this letter and thus "totally ignored" the evidence in its analysis.253
147. On this basis, China requests the Appellate Body to reverse the Panel's finding that the
European Union did not exclude producers who did not support the complaint from the definition of
the domestic industry. China further requests the A ppellate Body to complete the analysis and find
that the European Union excluded from the defin ition of the domestic industry the producers who did
not support the complaint and that, in so doing, the European Union acted inconsistently with

249China's other appellant's submission, para. 89.
251Letter from the European Commission dated 18 November 2008 to Van Bael & Bellis in response to
letter from Van Bael & Bellis dated 12 November 2008, submitted to the Panel as Panel Exhibit CHN-39. The
General Disclosure Document, supra, footnote 73, was the final disclosure document before the Commission
issued the Definitive Regulation.
252China's other appellant's submission, para. 97 (quoting Panel Exhibit CHN-39, supra, footnote 251,
p. 1). (underlining by China omitted)
253China's other appellant's submission, para. 99.

Article 4.1 of the Anti-Dumping Agreement . China argues that, apart from the two exceptions
provided in Article 4.1, no other categories of producers may be excluded by the investigating
authorities from the definition of the domestic industry. China finds support for its position in the text
of Article 4.1, as well as in the finding of the panel in EC – Salmon (Norway) that, under Article 4.1,
it is not permissible to exclude from the domestic industry definition certain categories of producers
of the like product other than those set out in paragraphs (i) and (ii) of that provision.254
(ii) Exclusion of producers who did not come forward within
15 days of the initiation of the investigation
148. China claims that the Panel erred in the legal interpretation, and acted inconsistently with
Article 11 of the DSU, in finding that the European Union did not act inconsistently with Article 4.1
of the Anti-Dumping Agreement by excluding from the domestic industry definition all producers who
did not come forward within 15 days of the initiation of the investigation.
149. According to China, the Panel erred in the in terpretation of Article 4.1 when finding that
"nothing in Article 4.1 … would preclude inv estigating authorities from establishing deadlines for
companies to come forward in order to be cons idered for inclusion in the domestic industry". 255 In
China's view, Article 4.1 prohibits the exclusion of any categories of producers, except for those
provided under paragraphs (i) and (ii), and the pr ohibition applies to producers defined as a category
on the basis of the time period within which they must come forward. China submits that the
imposition of a deadline for domestic producers to come forward may be permissible by reasons of
the necessity for the investigating authorities to c onclude the investigations within the time-limit
prescribed in Article 5.10 of the Anti-Dumping Agreement. The deadline, however, must be balanced
with the fundamental due process rights enjoyed by interested parties. Therefore, any deadline
granted by the investigating authorities to domestic producers to come forward must be "reasonable"
and "sufficient".256 China further submits that a deadline would not be permissible if the investigating
authorities continue to consider the inclusion of producers who come forward after the deadline, but
ultimately decide not to include such producers, b ecause this would constitute a deliberate exclusion
process inconsistent with Article 4.1 of the Anti-Dumping Agreement.

254Under Article 4.1(i), domestic producers that ar e related to the exporters or importers or are
themselves importers of the allegedly dumped product may be excluded. Article 4.1(ii) further provides that
domestic industry may be limited to include only those producers within a particular geographic region, if
certain criteria are met.
256China's other appellant's submission, para. 125.

150. China maintains that the Panel failed to cond uct an objective assessment of the facts, as
required by Article 11 of the DSU, when finding that the European Union "did not act to exclude"
producers who did not make themselves known within 15 days of the initiation of the investigation.
257
China submits that both the Definitive Regulation and the Information Document indicate that the
domestic industry consists of EC producers who expressed a wish to be included in the sample within
the 15-day deadline. Moreover, as the Panel also noted, there seemed to have been "a process of
considering additional producers for inclusion in the domestic industry", although none of the
producers so considered were, in the end, included in the domestic industry. 258 In China's view, this
shows that the Commission envisaged including pr oducers other than those who had come forward
within the 15-day period but decided not to do so. In the light of the above evidence, China argues,
the Panel should have concluded that the Commission acted to exclude producers who had not come
forward within the 15-day deadline.
151. Furthermore, China asserts that the Panel faile d to conduct an objective assessment of the
facts, as required by Article 11 of the DSU, in finding that China had not established that the 15-day
period granted by the Commission was insufficien t or unreasonable. China contends that it
substantiated, before the Panel, the insufficien cy and unreasonableness of the 15-day deadline with
the following arguments and evidence. First, the 15-day deadline is "very short and makes it much
more likely that complainants and companies s upporting the investigation", rather than producers
opposing the investigation, will come forward within the prescribed period.
259 China submits that this
argument is supported by the evidence, which shows that the 46 producers that made up the domestic
industry all supported the complaint and all came forw ard within the 15-day deadline. In addition, as
shown by the Information Document, "a large number of" producers who opposed the complaint or
did not express an opinion were not incl uded in the domestic industry definition.
260 Furthermore, by
requiring producers to come forward within 15 da ys and express a willingness to be included in the
sample within that deadline, th e European Union adopted an approach that was "fundamentally
non-objective", because producers opposing the investiga tion were less likely to be willing to be part
of the sample. 261 Finally, China asserts that the 15-day d eadline to respond to the sampling form is
not the same as the period in which an interested party was requested to make itself known under the
Notice of Initiation, which was a 40-day period. China contends, therefore, that it properly
substantiated its argument before the Panel that the 15-day deadline was unreasonable and therefore
inconsistent with Article 4.1 of the Anti-Dumping Agreement.

259China's other appellant's submission, para. 135.
260China's other appellant's submission, para. 136.
261China's other appellant's submission, para. 137.

152. On this basis, China requests the Appellate Body to reverse the Panel's finding that the
Commission "did not act to exclude" 262 producers who did not make themselves known
within 15 days of the initiation of the investigation, and that "the mere fact that the domestic industry
as ultimately defined does not include any particul ar proportion of producers … who did not come
forward within the 15-day period, does not demonstrat e that the European Union acted inconsistently
with Article 4.1 of the [Anti-Dumping Agreement] in defining the domestic industry."263 China further
requests the Appellate Body to conclude that the 15-day period granted to domestic producers to come
forward was not reasonable or sufficient and that the European Union acted inconsistently with
Article 4.1 by setting such a deadline.
(iii) Inconsistency with Article 3.1 of the Anti-Dumping
Agreement
153. China alleges that the Panel erred in its interpretation of Article 3.1 of the Anti-Dumping
Agreement in dismissing China's claim under that provis ion because it found that the European Union
did not act inconsistently with Article 4.1 of the Anti-Dumping Agreement with respect to the
definition of the domestic industry. According to China, the separate claims made by China on
two different legal bases under Article 4.1 and Artic le 3.1 required the Panel to examine whether the
exclusion from the domestic industry of the producers who did not support the complaint and the
producers who did not come forward within th e 15-day deadline was inconsistent with the
requirements under each of those provisions.
154. China contends that Article 3.1 of the Anti-Dumping Agreement requires the injury
determination to be based on "positive evidence" and to involve an "objective examination" of,
inter alia, the impact of dumped imports on domestic producers. Thus, by excluding the producers
who did not support the complaint from the definition of the domestic industry, the European Union's
action was "fundamentally biased and non-objective" , because it "favour[ed] the interests of a group
of interested parties, namely the complainants".
264 Moreover, the exclusion of the producers who did
not make themselves known within the 15-day d eadline was also "bias[ed]" and "non-objective" 265,
because the European Union included only those pr oducers who came forward within that deadline
and expressed a willingness to be part of the sample. In China's view, the domestic industry must first
be defined from which a sample may be selected. By including in the domestic industry definition
only those producers willing to be part of the sampl e, the European Union's approach confused two
different steps in the process of selecting a sample. Because producers not willing to be included in

262Panel Report, para. 7.215. See also China's other appellant's submission, para. 141.
263Panel Report, para. 7.219. See also China's other appellant's submission, para. 141.
264China's other appellant's submission, para. 155.
265China's other appellant's submission, para. 156.

the sample "probably [did] not support the investigation"
266, this approach made it more likely that
only those companies supporting the complaint would be included in the domestic industry definition
and, hence, made it more likely to find injury. Therefore, China asserts, by including in the domestic
industry only those producers who came forward within the 15-day deadline and expressed their
willingness to be part of the sample, the European Un ion acted inconsistently with Article 3.1 of the
Anti-Dumping Agreement by failing to make an objective examination of the impact of the dumped
imports on the domestic industry.
155. On this basis, China requests the Appellate Body to reverse the Panel's finding that "China
[made] no other allegations in support of its claim of violation of Article 3.1" 267 of the Anti-Dumping
Agreement and its claim must therefore be rejected, and to conclude that the European Union acted
inconsistently with that provision with respect to the definition of the domestic industry.
(b) "A Major Proportion" of the Total Domestic Production
156. China submits that the Panel erred in rejecti ng China's claim that th e domestic industry as
defined by the European Union did not include domestic producers whose collective output of the like
product constitutes a "major proportion" of the tota l domestic production. According to China, the
Panel erroneously concluded that the fact th at the Commission relied on a presumption that
25 per cent of total domestic pr oduction constituted "a major proportion" within the meaning of
Article 4.1 of the Anti-Dumping Agreement was, in itself, insufficient to demonstrate that the
definition of the domestic industry in this dispute is inconsistent with Artic le 4.1. Moreover, the
Panel erroneously concluded that the non-quantitative factors raised by China were not relevant to the
examination of whether the domestic industry de fined by the Commission met the requirement of
"a major proportion" under Article 4.1.
(i) The interpretation of the term "a major proportion"
157. China submits that the interpretation of the te rm "a major proportion" on the basis of its
ordinary meaning and in the light of the context lead s to only one permissible interpretation, which is
different from the one followed by the Panel. Quo ting the relevant dictionary definitions, China
argues that "a major proportion" means a "share" of the whole that is "unusually important, serious or
significant".268 Therefore, the domestic producers whose production makes up a major proportion

266China's other appellant's submission, para. 162.
267Panel Report, para. 7.221. See also China's other appellant's submission, para. 171.
268China's other appellant's submission, paras. 185 (quoting The New Shorter Oxford English
Dictionary, 4th edn, L. Brown (ed.) (Clarendon Press, 1993), Vol. 2, p. 2381) and 188 (quoting ibid., Vol. 1,
p. 1670).

must be representative of the whole. As support, China recalls the Appellate Body's finding in US –
Lamb that the words "as a whole" and "a major proportion" in Article 4.1(c) of the Agreement on
Safeguards address "the representative nature of producers making up the domestic industry" 269, as
well as the panel's finding in that dispute that the words relate to the "representativeness of the data
pertaining to the condition of the domestic industry". 270 China submits that, although the Panel found
that the word "major" means "important, serious, or significant", the Panel failed to take into account
the "representative" requirement under the phase "a major proportion".271
158. According to China, the reference to "the domestic producers as a whole", which constitutes
the immediate context of the phrase "a major proportion", indicates that "[t]he reason for permitting
the domestic industry to be defined as those pr oducers constituting only a 'major proportion' is to
address the practical impossibility for investigating authorities in some cases to obtain the requested
information from all the producers of the like product."
272 China recalls that paragraphs (i) and (ii) of
Article 4.1 expressly authorize the exclusion from the definition of the domestic industry of two
categories of producers. In China's view, it would be superfluous to set out precise conditions for the
application of the two exclusions if investigating authorities could in any event exclude from the
definition of the domestic industry any other producers they wish as long as the remaining producers
still constitute a major proportion. Moreover, given the requirement under Article 3.1 that an injury
determination "be based on positive evidence and involve an objective examination", China argues
that "a major proportion" must be sufficiently re presentative of the domestic production "as a whole"
to ensure that the examination carried out with r espect to the industry, as defined, is "objective"
within the meaning of Article 3.1 of the Anti-Dumping Agreement.
159. Therefore, China submits, whether the requirement of "a major proportion" is met must be
assessed in the light of the specific circumstances of a case, including "the practical feasibility for the
investigating authorities to includ e more producers than those act ually included, the number of
producers and the exclusion of certain categories of producers from the scope of the domestic
industry".273

269China's other appellant's submission, para. 185 (quoting Appellate Body Report, US – Lamb ,
para. 91).
270China's other appellant's submission, para. 186 (quoting Panel Report, US – Lamb , para. 7.73).
(underlining by China omitted)
271China's other appellant's submission, para. 190.
272China's other appellant's submission, para. 195.
273China's other appellant's submission, para. 201.

(ii) Whether the domestic industry defined in the fasteners
investigation meets the requirement on "a major proportion"
160. China maintains that, as indicated in the Defin itive Regulation in the fasteners investigation,
the EU producers whose output represented 27 pe r cent of the total domestic production constituted
"the Community industry within the meaning of Articles 4(1) and 5(4) of the [Basic
AD Regulation]."
274 Articles 4(1) and 5(4) of the Basic AD Regulation are largely similar to
Articles 4.1 and 5.4 of the Anti-Dumping Agreement , except that Article 4(1) of the Basic AD
Regulation defines "a major proportion" as bein g equal to 25 per cent of the total domestic
production, namely, the minimum benchmark for m eeting the standing requirement contained in
Article 5(4). Thus, it is "not disputed" that the Commission concluded in the fasteners investigation
"that the domestic producers making up the domestic industry constituted a 'maj or proportion' solely
because they represented more than 25% of the total domestic production".275
161. China contends that Article 5.4 of the Anti-Dumping Agreement merely lays down a standard
for determining whether the standing requirement is met and an investigation may be initiated.
Article 4.1, in contrast, defines the "domestic industr y" and is therefore a very different exercise than
that of measuring the degree of support for a complain t within the meaning of Article 5.4. Therefore,
in China's view, it is "legally incorrect" to estab lish an automatic link between the requirement on
"a major proportion" and the 25 per cent mi nimum benchmark for meeting the standing
requirement.276 Moreover, China submits that whether the requirement on "a major proportion" is met
may not be determined in the abstract, on the basi s of a quantitative benchm ark, but depends on the
facts of the case. In China's view, by relying on this rule when defining the domestic industry,
without assessing the specific circumstances in this case, the Commission acted inconsistently with
Article 4.1 of the Anti-Dumping Agreement.277 Thus, the Panel "made a fundamental legal error in
finding that 'the assertion that the Commission re lied on a presumption is not alone sufficient to
demonstrate, prima facie , that the definition of domestic industr y in this case is inconsistent with
Article 4.1 of the [Anti-Dumping Agreement].'"278
162. China further maintains that the Panel erred in failing to consider certain non-quantitative
factors that China argued were relevant to the ex amination of whether the requirement of "a major
proportion" was met in the fasteners investigation. Specifically, China argues that, by excluding from

274China's other appellant's submission, para. 211 (quoting Definitive Regulation, supra, footnote 4,
recital 114).
275China's other appellant's submission, para. 216.
276China's other appellant's submission, para. 237.
277See China's other appellant's submission, paras. 223-228 and 240.

the domestic industry definition the producers who opposed the complaint or remained silent, the
"domestic industry" as defined by the Commission w as not representative of the whole industry and,
thus, not "a major proportion" of the production of that industry. 279 Furthermore, the Panel erred in
finding that the possibility or feasibility for the inve stigating authority to include more producers in
the domestic industry definition, and the reasons why it did not do so, was irrelevant to an
examination of whether the requirement on "a major proportion" was met. As shown by the relevant
evidence, the Commission had identi fied at the outset of the investigation "at least 114 producers
representing 45% of the total domestic production".
280 However, the Commission ultimately excluded
more than half of these producers from the domestic industry definition, even though it would have
been possible for it to include more producers. Finally, China asserts that the number of producers
constituting the domestic industry is relevant to a determination of whether a certain percentage in
terms of the volume of production constitutes a major pr oportion. Yet, the Panel failed to take into
account the fact that, although there were more than 300 producers of fasteners in the
European Union, the domestic industry definition only included 45 producers. In China's view, "[t]his
is a very limited proportion which cannot be considered a 'major proportion'".
281
163. On this basis, China requests the Appellate B ody to reverse the Pane l's finding that, "[e]ven
assuming non-quantitative factors are relevant to the definition of a domestic industry under
Article 4.1, we do not consider that the factors China raises in this regard are relevant in this case, or
in general." 282 China further requests the Appellate Body to conclude that, in the light of these
non-quantitative factors, the domestic producers cons tituting the domestic industry in the fasteners
investigation did not represent a "major proportion" of the domestic industry.
(c) The Representativeness of the Sample of Domestic Producers in the
Injury Determination
164. China submits that the Panel erred in rejecti ng China's claim that the European Union acted
inconsistently with Article 3.1 of the Anti-Dumping Agreement in the selection of a sample of the
domestic producers for purposes of the injury determin ation. China alleges that the Panel made the
following two specific errors.
165. First, China asserts that the Panel wrongly rej ected China's contention that, because "only a
statistically valid sample will be sufficien tly representative for purposes of an injury

279See China's other appellant's submission, paras. 245-249.
280China's other appellant's submission, para. 254.
281China's other appellant's submission, para. 258.
282Panel Report, para. 7.230. See also China's other appellant's submission, para. 259.

determination"
283, the sample of producers selected by the Commission on the basis of the largest
volume of production that could reasonably be inv estigated was not representative of the domestic
industry. According to China, despite th e absence of a specific provision in the Anti-Dumping
Agreement addressing the issue of sampling of the domest ic industry for purposes of assessing injury,
"the investigating authorities are bound by the obligation laid down in Article 3.1 of the
[Anti-Dumping Agreement] that the injury determination invol ve[s] an objective examination and be
based on positive evidence." 284 China asserts that, in the context of the dumping determination,
pursuant to Article 6.10 of the Anti-Dumping Agreement, limiting a sample to the largest percentage
of the volume of the exports that can reasonably be investigated may be justified in the light of the
"possibility for subsequent refunds if an individual producer is not actual[ly] dumping". 285 Because
"there is no similar system which would take into account the absence of injury with respect to certain
domestic producers", it is "fundamental" that a sa mple in the injury context be sufficiently
representative of the domestic industry as a whole. 286 Therefore, in China's view, a sample cannot
merely be based on the largest volume that can re asonably be investigated, but should take into
account other criteria, such as, the use of a statistically valid sample.
166. Second, China alleges that the Panel erred in concluding that China had not demonstrated
"that the EU investigating authority could have carried out the entire injury examination for the
domestic industry it had defined, or at least included more producers in the sample".287 China submits
that, as it demonstrated before the Panel, the Commission examined certain injury factors with respect
to the entire domestic industry as defined, that is, the 45 domestic producers. Thus, contrary to the
Panel's finding, the Commission could have also an alyzed the other injury factors for the entire
domestic industry as defined, rather than with respect to only the sampled producers.
167. On this basis, China requests the Appellate Body to reverse the Panel's finding that the
European Union did not act inconsistently with Article 3.1 of the Anti-Dumping Agreement in the
selection of a sample of the domestic industry, and to conclude that the European Union, by selecting
the sample for the injury determination solely on the basis of the volume of production, and by
including in the sample only six producers represen ting 17.5 per cent of total domestic production,
acted inconsistently with Article 3.1 of the Anti-Dumping Agreement.
288

284China's other appellant's submission, para. 270.
285China's other appellant's submission, para. 272 (quoting Panel Report, EC – Salmon (Norway) ,
footnote 309 to para. 7.132).
286China's other appellant's submission, para. 272.
288See China's other appellant's submission, paras. 275 and 278; and Panel Report, para. 7.241.

2. The Panel's Findings under Article 2.4 of the Anti-Dumping Agreement
168. China requests the Appellate Body to reverse th e Panel's finding that the European Union did
not act inconsistently with Article 2.4 of the Anti-Dumping Agreement with respect to the comparison
of the export price and normal value in the dumping de termination. China claims that the Panel also
acted inconsistently with Article 11 of the DS U by not addressing China's argument that the
Commission failed to indicate to the interested parties what information was necessary to ensure a fair
comparison. China further submits that the Pane l erred in its interpretation and application of
Article 2.4, and acted inconsistently with Article 11 of the DSU, in rejecting China's claim that the
Commission failed to make adjustments for the diffe rences in physical characteristics identified in the
PCNs. Finally, China maintains that the Panel erred in the interpretation and application of
Article 2.4 of the Anti-Dumping Agreement in rejecting China's claim that the Commission failed to
make adjustments for quality differences.
(a) The Panel's Treatment of China's Argument
169. China recalls that, at the outset of the fast eners investigation, the Chinese producers were
requested to provide product information on the b asis of the PCNs identified by the Commission, and
"it was clear"289 that the PCNs would be used for the pur poses of ensuring a fair comparison between
the export price and the normal value. Although the Commission later decided not to use the PCNs
for purposes of price comparison, and instead relied on certain "product types", it did not inform the
Chinese producers of this change until one worki ng day before the deadline for submitting comments
on the General Disclosure Document. Before the Panel, China claimed that, under the last sentence of
Article 2.4 of the Anti-Dumping Agreement , the Commission was required to inform the Chinese
producers of the fact that the comparison was not ma de on the basis of the PCNs and to provide them
with a sufficient opportunity to comment. However, the Panel did not address this argument, noting
that this was "the main argument China raise[d] in connection with its claim under Articles 6.2,
6.4, 6.5 and 6.9 of the [Anti-Dumping Agreement]"290, and did not explain why it was not necessary to
examine the argument in the context of China's claim under Article 2.4 of the Anti-Dumping
Agreement. China maintains that the Panel thus failed to address a substantial argument by China that
was central in the assessment of whether the European Union acted inconsistent ly with Article 2.4 of
the Anti-Dumping Agreement . The Panel's failure to address th is argument "deprive[d] China of a

289China's other appellant's submission, para. 297.

complete resolution of the matter at issue" and "would … constitute a false exercise of judicial
economy".
291
170. China therefore requests the Appellate Body to find that the Panel acted inconsistently with
Article 11 of the DSU by failing to address China's ar gument under the last sentence of Article 2.4 of
the Anti-Dumping Agreement. In the event the Appellate Body considers that the Panel "implicitly
rejected China's argument" 292, China requests the Appellate Body to find that the Panel erred in its
interpretation and application293 of Article 2.4 of the Anti-Dumping Agreement.
171. China further requests the Appellate Body to complete the analysis and find that the
Commission's failure to inform the interested parties of the change in the basis for price comparison
constitutes a violation of Article 2.4 of the Anti-Dumping Agreement. China submits that the relevant
factual findings of the Panel in its examination of China's claim under Articles 6.2 and 6.4 of the
Anti-Dumping Agreement provide the factual basis for completing the analysis. Specifically, the
Panel found that the "Chinese producers were informed very late in the proceedings of the product
types that formed the basis of the comparisons underlying the Commission's dumping determinations"
and that, despite their request, the Chinese producer s "were not given a timely opportunity to see the
relevant information by the Commission". 294 Moreover, the Panel correctly found that, without the
information concerning the basis on which the co mparison will actually be made, "it would be
difficult if not impossible, for foreign producers to request adjustments that they consider necessary in
order to ensure a fair comparison." 295 China therefore submits that the Commission was under an
obligation to inform the interested parties of the basis on which the comparison between the export
price and the normal value was made, and to provide sufficient time for the interested parties to
comment or request adjustments. Because th e Commission failed to do so, China requests the
Appellate Body to find that the European Union fa iled to "indicate to the parties in question what
information is necessary to ensure a fair comp arison" and imposed "an unr easonable burden of proof
on those parties"296, and thus acted inconsistently with Article 2.4 of the Anti-Dumping Agreement.

291China's other appellant's submission, para. 312.
292China's other appellant's submission, para. 315.
293Although China's other appellant's submission allege s that the Panel erred in its interpretation (see
para. 296), China clarified at the oral hearing that its cl aim also covers the Panel's application of Article 2.4 to
the facts of the case.
296China's other appellant's submission, para. 332.

(b) Physical Differences
(i) The Panel's interpretation and application of Article 2.4
172. China submits that the Panel erred in its interpretation and application 297 of Article 2.4 of the
Anti-Dumping Agreement in rejecting China's argument that th e European Union acted inconsistently
with Article 2.4 of the Anti-Dumping Agreement by failing to evaluate, and make adjustments for,
physical characteristics identified in the PCNs.
173. China submits that, under Article 2.4 of the Anti-Dumping Agreement , the requirement to
make due allowance for physical differences means that the investigating authority must at least
evaluate identified differences with a view to determ ining whether or not an adjustment is required.
China alleges that this is confirmed by relevant findings of the panels in Argentina – Ceramic Tiles
and EC – Tube or Pipe Fittings .298 In the light of the fact that the Commission initially identified the
physical characteristics reflected in the PCNs as "necessary to make a 'fair comparison'" but later
decided to base the comparison on product types instead 299, China contends that Article 2.4 imposes a
"twofold obligation"300 on the Commission. Specifically, the Commission was required to: (i) first
evaluate all differences in physical characteristics that had been identified in the PCNs to determine
whether they affected price comparab ility; and (ii) conclude, on the basis of such an evaluation, that
adjustments were indeed required so as to ensure a fair comparison. 301 Yet, the Commission failed to
do either.
174. China maintains that, in rejecting China's argu ment that the Commission acted inconsistently
with Article 2.4, the Panel erroneously found that there was no evidence on the record demonstrating
that the PCN elements necessarily affected price co mparability. In China's view, the Panel failed to
distinguish between the two-step analysis that the Commission was required to conduct, because its
finding only concerned the second step described a bove. Indeed, the relevant findings of the Panel
make it clear that the physical characteristics in the PCNs constitute differences that had been
identified by the investigating authorities. Spec ifically, the Panel found that the fact that the
Commission sought information on the basis of PC Ns "suggest[ed] … that these elements might

297Although China's other appellant's submission allege s that the Panel erred in its interpretation (see
paras. 296, 344, and 367), China clarified at the oral hearing that its claim also covers the Panel's application of
Article 2.4 to the facts of the case.
298See China's other appellant's submission, paras. 353 and 354 (quoting Panel Report, Argentina –
Ceramic Tiles, para. 6.113; and Panel Report, EC – Tube or Pipe Fittings, para. 7.157).
299China's other appellant's submission, para. 337.
300China's other appellant's submission, para. 346.
301See China's other appellant's submission, para. 346.

affect price comparability".
302 China further contends that, because the interested parties were under
the impression that the price comparison was being made on the basis of the PCNs, they made no
requests for adjustments during the investigation co ncerning the physical characteristics reflected in
the PCNs. Nonetheless, as China submitted before the Panel, the interested parties stressed
throughout the investigation the importance of using the PCNs for purposes of ensuring a fair
comparison. However, the Panel failed to "come to the logical conclusion" that, because the physical
characteristics " might affect price comparability", they had been identified as differences that the
Commission was required to evaluate.
303
175. China also takes issue with the Panel's finding that, although information organized on the
basis of the PCNs may well facilitate the comparison process, "the obligation to make a fair
comparison under Article 2.4 does not vary depending on the form in which information is requested
or received."
304 In China's view, because the Commi ssion had identified certain physical
characteristics as possibly affecting price comp arability, it was required to evaluate those
characteristics to determine whether adjustments were necessary to ensure a fair comparison.
176. On this basis, China requests the Appellate B ody to reverse the Panel's finding that "the
argument that the Commission should have consid ered whether the elements excluded from the
comparison nonetheless required adjustments does not amount to a prima facie case of violation of
Article 2.4" 305, and find that the European Union's failu re to evaluate the differences identified
through the PCNs constitutes a violation of Article 2.4 of the Anti-Dumping Agreement.
(ii) The Panel's failure to make an objective assessment of the
facts
177. China submits that the Panel failed to make an objective assessment of the facts in finding
that China pointed to no evidence that was before the investigating authority in support of its claim
that the PCN characteristics indicated differences affecting price comparability. As a preliminary
matter, China recalls that the Commission, by failing to inform the interested parties of the basis for
the price comparison, made it impossible for th e Chinese producers to re quest adjustments and
provide the necessary evidence.
178. Moreover, China contends that it demonstrated to the Panel that there was evidence before the
Commission showing that the PCN characteristics were differences affecting price comparability and

302China's other appellant's submission, para. 359 (quoting Panel Report, para. 7.301). (underlining by
China omitted)
303China's other appellant's submission, para. 361. (original emphasis)

warranting adjustments. Specifically, the fact that certain physical characteristics were reflected in
the PCNs shows that such characteristics affect price comparability, because reliance on PCNs had
been identified by the investigating authorities at the beginning of the investigation as being necessary
to ensure a fair comparison. In addition, sever al of the PCN characteristics were used by the
Commission for purposes of the price undercutting analysis between the Chinese and European
fasteners producers in the injury determination, in cluding the type of coating applied and the use of
expensive chrome on coating. China also alle ges that it referred the Panel to the following
three pieces of additional evidence to demonstrate that the PCN characteris tics necessarily affected
price comparability: (i) a statement by the EU producers, in the context of a discussion on the
comparability between EU and Chinese fasteners, re garding the fact that raw materials represent 40
to 55 per cent of the costs and may be lower for produ cts with a little diameter; (ii) a statement by the
Chinese Chamber of Commerce, in the same context, that it was necessary to add to the differences
reflected in the PCNs a distinction between standard and special fasteners; and (iii) a presentation on
behalf of a Chinese interested party that the PC N characteristics are not sufficiently detailed to
differentiate interims of the quality of fasteners. China therefore asserts that, by ignoring the above
evidence, the Panel failed to make an objective asse ssment of the facts, as required by Article 11 of
the DSU.
179. China further maintains that Article 17.6(i) of the Anti-Dumping Agreement requires the Panel
to determine whether the Commission's establis hment of the facts was proper and whether its
evaluation of those facts was unbiased and objectiv e. Because the Commission "ignored the evidence
before it that demonstrated that the PCN characteris tics could affect price comparability", "it is clear"
that the Commission's establishment of the facts w as not proper and its evaluation of those facts was
not unbiased and objective. 306 Thus, the Panel, by finding that it would be inappropriate for it to
consider whether the PCN charact eristics reflect differ ences affecting price comparability, "ignored
the duty imposed upon it by Article 17.6 (i)" of the Anti-Dumping Agreement.307
180. On this basis, China requests the Appellate B ody to reverse the above Panel findings. China
further requests the Appellate Body to complete th e analysis and find that the European Union acted
inconsistently with Article 2.4 of the Anti-Dumping Agreement by not making the necessary
adjustments for the differences in physical characteris tics identified in the PCNs. This is because an
objective and unbiased investigating authority should ha ve concluded, on the basis of all the elements
before the Commission, that the PCN characteristi cs described in this case indicate differences

306China's other appellant's submission, para. 387.
307China's other appellant's submission, para. 386.

affecting price comparability and that, accordingly, these had to be accounted for by means of
adjustments.
(c) Quality Differences
181. China asserts that the Panel erre d in the interpretation and appl ication of Article 2.4 of the
Anti-Dumping Agreement in rejecting China's claim that the European Union acted inconsistently with
that provision by not making the necessary adju stments for quality differences affecting price
comparability.
182. China recalls that, under Article 2.4, investigati ng authorities must at least evaluate identified
differences in physical characteristics with a view to determining whether or not an adjustment is
necessary to ensure a fair comparison of the export pr ice and the normal value. In this case, "[i]t is
not disputed that at least one of the Chinese ex porters" sent a letter requesting adjustments for
differences in quality between Indian and Chinese fasteners.
308 Moreover, the Commission
"acknowledge[d] the existence of quality differences" in the Definitive Regulation by stating that
"[a]ny perceived differences in qua lity, which may subsist from a user's point of view, can be dealt
with through an adjustment for physical differences". 309 The Commission also stated in a letter to
some Chinese exporters that adjust ments were made for the cost of quality control that "reflects the
general difference in quality level". 310 This, in China's view, also shows that quality differences had
been identified and that the Commission should have evaluated such differences. China therefore
contends that the Panel erred in not concludi ng that the Commission acted inconsistently with
Article 2.4 of the Anti-Dumping Agreement by not evaluating the identified quality differences.
183. China further submits that, in finding that th e Commission did not act inconsistently with
Article 2.4 of the Anti-Dumping Agreement , the Panel "ignore[d] the fact" that the Commission
acknowledged the existence of quality differences. According to China, there is a duty on the
investigating authority to request the necessary information if it feels that a claimed adjustment is not
sufficiently substantiated. Therefore, "at th e very least, the Commission should have sought
additional information on this issue." 311 China thus maintains that the Panel erred in law by failing to
conclude that the failure of the Commission to indicate further information that would be necessary to

308China's other appellant's submission, para. 410.
309China's other appellant's submission, para. 411 (quoting Definitive Regulation, supra, footnote 4,
recital 52).
310China's other appellant's submission, para. 413 (quoting Letter dated 21 November 2008 from the
European Commission to Van Bael & Bellis replying to Van Bael & Bellis' letter dated 17 November 2008
(Panel Exhibit CHN-31), point 5).
311China's other appellant's submission, para. 420.

ensure a fair comparison and the failure to make appropriate adjustments was inconsistent with
Article 2.4 of the Anti-Dumping Agreement.
3. The Panel's Findings under Articles 6.5, 6.2, and 6.4 of the Anti-Dumping
Agreement Regarding the Disclosure of the Identity of the Complainants
184. China requests the Appellate Body to reverse the Panel's findings that the European Union did
not act inconsistently with Articles 6.5, 6.4, and 6.2 of the Anti-Dumping Agreement when it failed to
disclose to Chinese producers the identity of the comp lainants and the supporters of the complaint.
China argues that the complainants' allegation of "potential commercial retaliation" was not sufficient
to satisfy the requirement to show "good cause" under Article 6.5, and that the Panel violated
Article 11 of the DSU in its evaluation of this claim. Assuming the Appellate Body finds that the
identity of the complainants and the supporters of the complaint were not properly treated as
confidential information, China requests the Appellate Body to complete the analysis to find that the
European Union therefore also violated Articles 6.4 and 6.2 of the Anti-Dumping Agreement when it
failed to disclose this information to Chinese exporters upon request.
(a) The Complainants' "Good Cause" Showing
185. China claims that the Panel erred in findi ng that the Commission had established that
"good cause" existed for the confidential treatment of the identity of the complainants and the
supporters of the complaint under Article 6.5 of the Anti-Dumping Agreement. China observes that
the requirement to show "good cause" is, in the words of the panel in Mexico – Steel Pipes and Tubes,
of "critical importance" to preventing parties fro m abusing the privileges of confidential treatment,
and in "preserving the balance be tween the interests of confidentiality and the ability of another
interested party to defend its rights th roughout an anti-dumping investigation".
312 In China's view,
while every request for confidentiality requires an evidentiary showing of "good cause", in the case of
information that is not "by nature" confidential, such as the identity of the complainants, "a higher
threshold needs to be met".313
186. China argues that the Panel erred in its in terpretation of the "good cause" requirement,
because, in its view, Article 6.5 does not apply to commercial retaliation that is merely hypothetical in
nature. China contends that, in the complaint, domestic producers requested confidential treatment of
their identity because of a "potential retaliation" that "could" happen, but did not allege or show that
any "significantly adverse effect" "'would' happen if confidential treatment [was] not granted". In

312China's other appellant's submission, para. 447 (quoting Panel Report, Mexico – Steel Pipes and
Tubes, para. 7.380).
313China's other appellant's submission, para. 449.

China's view, Article 6.5 refers to situations that " would have a significantly adverse effect" upon the
parties supplying the information, and that the comp lainants' use of the word "could" suggests that
"the likelihood of the detrimental effect to occur is rather remote".
314
187. According to China, the complainants failed to provide any evidence to support the assertion
in the complaint that a threat of potential co mmercial retaliation existed. The Panel itself
acknowledged that the " only evidence before the Commission was the complaint" and that "[t]he
Commission relied on this statement, although there is no indication that the complainants submitted
evidence to support their concern in this regard." 315 In China's view, the reasoning included in the
complaint, that retaliation could come from the co mplainants' customers who also bought the subject
products from China, was a "mere statement" and clear ly does not amount to an evidentiary showing.
China contends that an interpretation of Article 6. 5 that does not require an evidentiary showing to
support "good cause" "is contrary to both the text and ratio legis of Article 6.5" and "seriously
undermines the delicate balance sought in that provis ion to protect the interests of all interested
parties".316
188. China further argues that the evidentiary burden of proof under Article 6.5 rests with the party
requesting confidential treatment, and that the Panel violated Article 11 of the DSU when it
impermissibly shifted this burden on China. The Panel found that China did not "contest the factual
assertion" contained in the complaint, and had not "p roffered any evidence, or even argued, that this
assertion was unfounded, unreasonable, or untrue". 317 It similarly found that evidence of "potential
commercial retaliation" is not likely to be obtain able, and that therefore, the allegation of the
complainants would be sufficient "unless there is some reason to believe that the fear of retaliation is
unreasonable, unfounded, or untrue – and China has proffered none". 318 In China's view, it was up to
the complainants in the investigation to present "c ompelling evidence" to support their allegation, and
it was not China's responsibility to present evid ence before a WTO panel that no "good cause"
existed.319 Moreover, even if China had an obligatio n to offer evidence agai nst the complainants'
allegation of potential commercial retaliation, it was prevented from doing so because it was never
given access to those complainants' identity.320

314China's other appellant's submission, paras. 450-453.
316China's other appellant's submission, para. 463.
319China's other appellant's submission, paras. 464 and 467.
320China's other appellant's submission, para. 468.

189. Before the Panel, China claimed that the Commission's disclosure of the sampled producers'
identity in the context of the injury determination demonstrated that good cause could not have
existed for the Commission's earlier confidentia l treatment of those producers' identity as
complainants and supporters of the complaint. By disclosing the names of the sampled producers,
China submits, the Commission thereby also reveal ed the names of several complainants and/or
supporters of the complaint. The fact that the dom estic producers did not request that their identity be
kept confidential in this context as well, demonstrat es, in China's view, that no "good cause" existed
to treat their identity as confid ential earlier in the proceedings. 321 On appeal, China claims that the
Panel erred in rejecting this argument because the Panel record contains clear evidence showing that
the entire domestic industry as defined by the Comm ission, and therefore also the domestic producers
sampled for purposes of the injury determination, consisted only of complain ants and supporters of
the complaint.322
190. China also claims that the Panel erred in fi nding that the identification of companies as
sampled producers would not cause the same concerns for those companies as their identification as
complainants and supporters, and that in the fast eners investigation it was not the case that the
sampled producers were necessarily complainants or supporters of the complaint. China argues that
the former argument is "unfounded" because the Pa nel did not explain why sampled producers would
not have the same concerns as complainants and support ers. As to the latter, China submits that this
conclusion was erroneous, because it was based on the European Union's "mere assertion" that
"at least one company included in the sample was not, in fact, either a complainant or supporter of the
complaint".323
(b) Disclosure under Articles 6.4 and 6.2 of the Anti-Dumping
Agreement
191. Assuming that the Appellate Body reverses th e Panel's finding that the European Union
properly treated the identity of the complainants as confidential information un der Article 6.5 of the
Anti-Dumping Agreement , China requests that the Appellate Body also reverse the Panel's
consequential findings under Articles 6.4 and 6.2 of the Agreement, and find instead that the
Commission's failure to disclose the identity of the complainants was inconsistent with both
provisions.324 To this end, China argues that the identity of the complainants and the supporters of the
complaint should have been disclosed in complianc e with Article 6.4 because this information was
"used" by the Commission in their standing determ ination, and was therefore "'relevant' to the

321China's other appellant's submission, para. 471.
322China's other appellant's submission, paras. 473 and 474.
323China's other appellant's submission, para. 477 (quoting Panel Report, footnote 940 to para. 7.454).
324China's other appellant's submission, para. 482.

presentation of [the Chinese producers'] cases" in this regard.
325 China also argues th at the identity of
the complainants should have been disclosed under Article 6.2 of the Anti-Dumping Agreement in
order to provide the producers with a "full opportunity for the defence of their interests". 326
According to China, Article 6.2 is "so broad" th at a violation of Article 6.4 "necessarily entails a
violation of Article 6.2".327 Even independently of a violation of Article 6.4, however, China submits
that the Commission violated Article 6.2 because, as a result of the Commission's failure to disclose
the names of these companies, the Chinese producer s were not given an opportunity properly to
examine and present arguments regarding the Commission's standing determination.328
4. The Panel's Findings that the MET/IT Claim Form Was Not a
"Questionnaire" for Purposes of Article 6.1.1 of the Anti-Dumping Agreement
192. China requests the Appellant Body to reverse th e Panel's finding that the Commission did not
act inconsistently with its oblig ations under Article 6.1.1 of the Anti-Dumping Agreement when it
allowed Chinese producers only 15 days from the publication of the Notice of Initiation of the
investigation to submit a claim form requesti ng market economy and/or individual treatment
("the MET/IT Claim Form"). Specifically, China argues that the Panel erred in finding that the
30-day time-limit required for the submission of "ques tionnaires" in Article 6.1.1 applies only to "the
initial comprehensive questionnaire" issued in an investigation. 329 In the alternative, China contends
that the Panel erred in finding that the MET/IT Claim Form was not the initial, comprehensive
questionnaire sent to foreign exporters in an NME investigation.
193. China submits that the Panel erred in interp reting the term "questionnaires" as referring only
to "the initial comprehensive questionnaire issued in an anti-dumping investigation to each of the
interested parties by an investigating authority at or following the initiation of an investigation, which
questionnaire seeks information as to all relevant issues pertaining to the main questions that will need
to be decided (dumping, injury and causation)". 330 Instead, China urges the Appellate Body to find
that the term "questionnaires" includes all information requests made through a series of questions
that are su30bstantial enough to warrant verifica tion, as long as extending a full 30-day deadline
would not prevent the investigating authorities from complying with the overall timeframe set out in
Article 5.10 of the Anti-Dumping Agreement for the completion of an investigation.331

325China's other appellant's submission, paras. 483 and 484.
326China's other appellant's submission, para. 487.
327China's other appellant's submission, para. 487.
328China's other appellant's submission, para. 488.
331China's other appellant's submission, para. 538.

194. China observes that the ordinary meaning of the term "questionnaire" is quite broad and
would on its face cover every document used by an investigating authority to seek information in the
form of "a formulated series of questions". 332 China also emphasizes the fact that Article 6.1.1 uses
the plural form of this term, which suggests that the provision would not only apply to multiple
questionnaires, but that each foreign producer ma y receive more than one questionnaire requiring a
30-day deadline throughout the course of the investigation.
333 China argues that Articles 6.1 and 6.2
of the Anti-Dumping Agreement provide the appropriate context for the interpretation of Article 6.1.1,
and notes that the Appellate Body has found that these provisions "set out the fundamental due
process rights" in anti-dumping investigations a nd provide for "liberal opportunities for respondents
to defend their interests".334 China claims that the reference to a "questionnaire" in paragraphs 6 and 7
of Annex I to the Anti-Dumping Agreement (Procedures for On-the-Spot Investigations pursuant to
Paragraph 7 of Article 6) shows that the term refers to information requests that are "so substantial"
that they require verification by the investigati ng authority—a characterization that would cover the
MET/IT Claim Form. 335 Finally, China argues that the purpose of the time-limit set out in
Article 6.1.1, that investigating authorities retain th e ability to "control and expedite the investigating
process", does not imply that the term "questionnaires" can refer to only one document. 336 C h i n a
claims that the Commission's ability to complete the fasteners investigation in a timely manner would
not have been frustrated by allowing the Chinese producers a full 30 days to submit the MET/IT
Claim Form.
337
195. Even if the Appellate Body determines that th e Panel was correct in its interpretation of the
term "questionnaires" in Article 6.1.1, China argues that the Panel violated Article 11 of the DSU and
Article 17.6(i) of the Anti-Dumping Agreement when it failed to find that, for the foreign exporters of
an NME country, the MET/IT Claim Form is the ini tial, comprehensive questionnaire. China submits
that the MET/IT Claim Form includes many of the same issues covered in other initial questionnaires,
and that the Panel's own admission that not all in itial questionnaires will cover the same material,
suggests that the MET/IT Claim Form need not have covered all the issues involved in the
investigation to be considered the "initial questionnaire".

332China's other appellant's submission, para. 509.
333China's other appellant's submission, para. 510.
334China's other appellant's submission, para. 513 (quoting Appellate Body Report, US – Oil Country
335China's other appellant's submission, para. 526.
336China's other appellant's submission, para. 533.
337China's other appellant's submission, para. 536.

D. Arguments of the European Union – Appellee
1. The Panel's Findings under Articles 4.1 and 3.1 of the Anti-Dumping
Agreement
196. The European Union requests the Appellate Body to reject China's appeal against the Panel's
finding that the European Union did not act inc onsistently with Article s 4.1 and 3.1 of the
Anti-Dumping Agreement with respect to the definition of the domestic industry in the fasteners
investigation. The European Union maintains that , as the Panel properly found, the European Union
did not exclude from the definition of the domestic industry those producers who did not support the
complaint. Nor did the European Union act inconsistently with Articles 4.1 and 3.1 of the
Anti-Dumping Agreement by not including in the domestic industry definition those producers who
made themselves known more than 15 days after the publication of the Notice of Initiation of the
investigation. The European Union further submits that the Panel correctly rejected China's assertion
that the domestic industry defined by the Commi ssion, consisting of those producers whose output
accounted for 27 per cent of total domestic production, did not meet the requirement of "a major
proportion" under Article 4.1 of the Anti-Dumping Agreement. Finally, with respect to China's claim
regarding the representativeness of the sample for pur poses of the injury determ ination, the European
Union contends that the claim was not properly befo re the Panel and therefor e outside the scope of
appellate review. In any event, the European Unio n asserts that China's arguments in support of this
claim are without merit.
(a) Exclusion of Certain Producers
197. The European Union submits that China fa ils to demonstrate that the Panel acted
inconsistently with Article 11 of the DSU and Article 17.6(i) of the Anti-Dumping Agreement in
finding that the European Union did not exclude producers who did not support the complaint from
the definition of domestic industry. Moreover, China has not demonstrated that the Panel erred in its
interpretation of Article 4.1 of the Anti-Dumping Agreement, or acted inconsistently with Article 11 of
the DSU, in rejecting China's allegation that the exclusion of the producers who did not come forward
within the 15-day deadline was incons istent with Article 4.1 of the Anti-Dumping Agreement . In
addition, China fails to demons trate that the Panel erred in law when it rejected China's
"consequential"
338 claim under Article 3.1 of the Anti-Dumping Agreement.

338European Union's appellee's submission, para. 107.

(i) Exclusion of producers who did not support the complaint
198. The European Union maintains that "[i]t is well established" that a panel, as the trier of facts,
enjoys a substantial margin of discretion. The di scretion is not boundless, and there could be a failure
to make an objective assessment of the facts in th e event of "deliberate disregard" and refusal to
consider the evidence, or in case of the "wilful distortion" or "misrepresentation" of the evidence. 339
In the European Union's view, the relevant jurisp rudence under Article 11 of the DSU suggests that a
violation of that provision is not "simply an error of judgment in the appreciation of evidence but
rather 'an egregious error that calls into question the good faith of a panel'".
340
199. Turning to the facts of the case, the European Union submits that the Panel properly took into
consideration, as part of the totality of evidence before it, the "information provided by the
[European Union] that at least one producer that had remained silent prior to initiation and thus had
not 'supported the complaint' was included in the definition of the domestic industry".
341 The Panel
"was right to assume good faith on the part of the [European Union]" 342, and there was no reason to
doubt the veracity of the information in the light of the relevant evidence on the record. Specifically,
the European Union provided the name of the pro ducer in question, rather than giving "a vague
reference to an unidentified mysterious producer that could not be verified". 343 Moreover, contrary to
China's assertion that the European Union should have provided the list of complainants and
supporters in order to prove the information it provide d, the European Union indicated to the Panel its
willingness to provide the list, but also highlighted the fact that the list had been treated as
confidential. The Panel did not request to see th e list, and it is not within the Appellate Body's
mandate to examine now evidence in respect of which factual findings have been made by the Panel.
200. Moreover, the European Union contends, the in formation it provided to the Panel concerning
the producer who had not supported the complaint was "mainly to confirm the [other] information
already provided by the [European Union] that no producer was excluded for reason of the fact that it
did not support the complaint". 344 Specifically, the European Union maintains that it submitted
evidence in the form of the sampling forms sent upon the initiation of the investigation to all known
producers for purposes of defining the domestic industry, which did not include a question concerning
support for the complaint. Moreover, recitals 23 to 25 of the Definitive Regulation also confirm that

339European Union's appellee's submission, para. 50 (quoting Appellate Body Report, EC – Hormones,
para. 133). (underlining by the European Union omitted)
340European Union's appellee's submission, para. 50 (quoting Appellate Body Report, EC – Hormones,
para. 133). (underlining by the European Union omitted)
341European Union's appellee's submission, para. 53.
342European Union's appellee's submission, para. 61.
343European Union's appellee's submission, para. 57.
344European Union's appellee's submission, para. 58. (original emphasis)

all those producers who responded to the sampling forms within the 15-day deadline and indicated
their willingness to cooperate were included in the do mestic industry definition, regardless of whether
they supported the complaint. Thus, the European Union contends, China erroneously suggests that
the European Union made a "mere assertion"
345 when it provided the name of the producer who had
not supported the complaint. On the contrary, this evidence was supported and confirmed by other
evidence on the record. The Panel therefore did no t act inconsistently with Article 11 of the DSU
because it took into account all of the above evidence in its assessment of the facts.
201. The European Union further submits that ther e is no basis for China's allegation that the
Commission knew whether the sampled producer who had not supported the complaint at the time of
initiation actually supported the investigation wh en it came forward after initiation. In the
European Union's view, China "speculates" about what the Commission could have known regarding
the producer's position in respect of the complaint, "when it has been established as a matter of fact
that this was a producer that (i) was silent befo re initiation and (ii) subsequently … return[ed] a
sampling form in which no question was asked about support for the complaint". 346 Therefore, the
Panel properly found that, "[w]hile China continues to assert that the Commission inquired as to the
position of EU producers with respect to the comp laint, the only evidence before the Panel, the
sampling forms, does not support that assertion." 347 The European Union asserts that the "evidence"
provided by China in this regard was based on "cer tain unfortunate statements in the Information
Document and in [the Definitive Regulation]". 348 Such statements, accordi ng to the European Union,
were due to certain "confusion" 349 between the issue of the standing requirement and the definition of
the domestic industry, which was caused by the Commission's inquiry, after the initiation of the
investigation, concerning the Chinese interested part ies' allegation that the standing requirement had
not been met. Although China disagrees with the weight given by the Panel to the alleged "evidence",
a panel's examination and weighing of the evidence submitted falls within th e scope of the panel's
discretion as the trier of the facts.
202. Finally, the European Union maintains that , in alleging that the Panel "disregarded"
350 three
pieces of evidence and thus acted inconsistently wi th Article 11 of the DSU, China's claim merely
concerns the Panel's appreciation of the evidence with in the boundary of its discretion as the trier of

345European Union's appellee's submission, para. 59 (quoting China's other appellant's submission,
para. 66).
346European Union's appellee's submission, para. 63.
348European Union's appellee's submission, footnote 47 to para. 65.
349European Union's appellee's submission, footnote 47 to para. 65.
350European Union's appellee's submission, para. 68 (quoting China's other appellant's submission,
para. 85).

facts. Specifically, the Panel rightly relied on rec itals 23 to 25 of the Definitive Regulation, which
show that support for the complaint was not a c ondition for being included in the domestic industry
definition, despite the reference to "producers s upporting the complaint" in the definition of the
domestic industry under the Definitive Regulation. "Similarly", the European Union argues, "the
Panel put the confused statements in the informal Information Document in context by pointing to the
fact that this was a mere working document w ith no legal status in the [European Union]."
351 Finally,
the European Union asserts that the Panel did not e rr in not expressly addressing the letter referred to
by China, because a panel "is not required to discuss, in its report, each and every piece of
evidence".352 In any event, China misinterprets the letter it sought to rely on, which does not state that
support for the complaint was a condition for inclusion in the domestic industry definition.
203. On this basis, the European Union submits th at China's allegation that the Panel committed
egregious error in not giving the same weight to th e evidence as did China, and acted inconsistently
with Article 11 of the DSU, must fail.
(ii) Exclusion of producers who did not come forward within
15 days of the initiation of the investigation
204. The European Union asserts that China fails to establish that the Panel erred in the legal
interpretation, and acted incons istently with Article 11 of the DSU, in finding that the
European Union did not act inconsistently with Article 4.1 of the Anti-Dumping Agreement by
excluding from the domestic industry definition all producers who did not come forward within 15
days following the initiation of the investigation.
205. The European Union contends that Ch ina accepts that it is "permissible" 353 to impose a
deadline for domestic producers to come forward, which undermines its assertion that Article 4.1
prohibits the exclusion of any categories of produ cers except for those provided under paragraphs (i)
and (ii). Moreover, there is no basis for Chin a's argument that the imposition of a deadline for
producers to come forward is "inadmissible if the investigating authorities … consider the inclusion of
producers that did not come forward within the d eadline and finally decide not to include them". 354
Indeed, China does not explain why it accepts that de adlines may be used, but then objects to the fact
that such deadlines are actually applied by the authorities. The European Union submits that

351European Union's appellee's submission, para. 72.
352European Union's appelles's submission, para. 73 (quoting Appellate Body Report, Brazil –
Retreaded Tyres, para. 202).
353European Union's appellee's submission, para. 78 (quoting China's other appellant's submission,
para. 125).
354European Union's appellee's submission, para. 81 (quoting China's other appellant's submission,
para. 126).

investigating authorities are entitled, under Article 6.14 of the Anti-Dumping Agreement, to maintain
control over the investigations and to impose deadlin es in order to be able to proceed expeditiously
with the investigation. Moreover, the authorities are required to impose such deadlines in order to
comply with their obligation under Article 5.10 of the Anti-Dumping Agreement to conclude the
investigation within 12 to 18 months. The Europ ean Union further submits that, in the fasteners
investigation, the 15-day deadline excluded producer s irrespective of their support for the complaint
and was a reasonable and objective way of defining the domestic industry.
206. The European Union maintains that there is no basis for China's allegation that the Panel
acted inconsistently with Article 11 of the DS U in finding that the European Union did not
deliberately exclude producers that came forward after the 15-day deadline. The Information
Document, to which China refers in support of its claim, merely reflects, "in a somewhat confused
manner"
355, the fact that the Commission accommodated th e Chinese interested parties' allegation,
that the standing requirement had not been me t, by contacting additional domestic producers
concerning their production volume and their position re garding the complaint. Moreover, the Panel
examined the relevant evidence and found that "the fact that the Commission considered including
[the additional producers in] the domestic industry s upports our view that it did not simply exclude
producers who did not come forward within the 15-day period." 356 In the European Union's view,
China's allegation that the Panel acted inconsistently with Article 11 of the DSU in reaching this
finding is "based on a wilful misreading of the Panel Report", because the Panel simply "reached the
factual conclusion that the authorities applied th e deadline they had set for domestic producers but
that in so doing the authorities had not been deaf to requests from exporters to contact more
producers".
357
207. The European Union argues that China's asserti on that the Panel acted inconsistently with
Article 11 of the DSU in finding that China had not demonstrated the unreasonableness of the 15-day
deadline is also without merit. As the Panel correctly found, China submitted no evidence regarding
the alleged unreasonable or insufficient nature of the 15-day deadline. China's mere "speculation"
that a deadline as short as 15 days makes it more likely that only complainants and supporters would
come forward does not amount to such evidence. 358 Moreover, contrary to China's argument, linking
the possibility of being included in the domestic indus try to a producer's willingness to be included in
the sample is unrelated to the question of whether the 15-day deadline is reasonable. This is because
the information requested in th e sampling form, concerning the products produced and the volume of

355European Union's appellee's submission, para. 89.
357European Union's appellee's submission, para. 91.
358European Union's appellee's submission, para. 96.

production, was easy to provide, and the indication of willingness to be included in the sample only
required the ticking of the appropriate box on the fo rm. Finally, the European Union contends that
China's assertion that the 15-day deadline to res pond to the sampling form is not the same as the
period in which an interested party was requested to make itself known under the Notice of Initiation
is "simply incorrect". This is so because the No tice of Initiation clearly provides for a 15-day period
for being included in the domestic industry, and a 40-day period for interested parties to make
themselves known "unless otherwise specified".359
208. On this basis, the European Union requests the Appellate Body to reject China's above claims
and arguments, as well as China's request for completion of the analysis.
(iii) Inconsistency with Article 3.1 of the Anti-Dumping
Agreement
209. The European Union maintains that the Panel co rrectly determined that China failed to make
a prima facie case under Article 3.1 of the Anti-Dumping Agreement because its arguments under that
provision were dependent on its ar guments under Article 4.1 of the Anti-Dumping Agreement . In
support of its appeal under Article 3.1, China simp ly repeats its arguments concerning the alleged
exclusion of the producers who did not support the complaint, and the alleged unreasonableness of the
15-day deadline. These are the same arguments China had raised under Article 4.1 of the
Anti-Dumping Agreement, which the Panel properly rejected. Thus, given the Panel's findings under
Article 4.1, and given the fact that China's argu ments under Article 3.1 were identical to those under
Article 4.1, the Panel did not err in rejecting Ch ina's claim under Article 3.1. The European Union
adds that China's appeal does not identify any error of law in the Panel's finding under Article 3.1, but
merely describes the alleged errors committed by the Commission in its definition of the domestic
industry. Thus, the European Union contends that , because China "never developed an independent
argument under Article 3.1 of the Anti-Dumping Agreement"360, the Appellate Body must also reject
China's appeal under that provision.
210. The European Union further submits that Ch ina's argument that the manner in which the
Commission defined the domestic industry was biased must also be rejected. China's assertion that
"[c]ompanies opposing the investigation are much less likely to be willing to be part of the sample
than companies supporting the investigation" 361 is "purely speculative". 362 Even if it were true, this

359European Union's appellee's submission, para. 101. (boldface by the European Union omitted)
360European Union's appellee's submission, para. 108.
361European Union's appellee's submission, para. 113 (quoting China's second written submission to the
Panel, para. 548).
362European Union's appellee's submission, para. 113.

does not mean that an authority cannot use cooperation as a criterion for defining the domestic
industry. In the absence of subpoena powers, the Commission was entitled to continue its
investigation on the basis of facts made available by the cooperating producers, as long as their output
represented a major proportion of the total domestic production. Finally, the European Union submits
that Article 3.1 of the Anti-Dumping Agreement only requires that the authorities conduct an objective
examination of positive evidence in respect of th e domestic industry as defined under Article 4.1.
Article 3.1 thus concerns only the manner in which data from those producers included in the
domestic industry definition is examined, an issue not raised in China's appeal under that provision.
211. On this basis, the European Union requests the Appellate Body to reject China's appeal under
Article 3.1 of the Anti-Dumping Agreement.
(b) "A Major Proportion" of the Total Domestic Production
212. As a preliminary matter, the European Union submits that it wishes to express its concern
about what it views as a change in China's position w ith regard to the interpretation of the term "a
major proportion" under Article 4.1 of the Anti-Dumping Agreement. Before the Panel, China agreed
with the interpretation of the panel in Argentina – Poultry Anti-Dumping Duties that "major" means
"important, serious or significant", with which th e European Union also agreed. Although China's
original position had been that "a major proportion" must be as close as possible to 100 per cent, it
"clearly abandoned its original position" by acknowle dging that "major" in abstract terms could even
be a percentage lower than 25 per cent.
363 Thus, noting the agreement between the parties on the
interpretation of the term "a major proportion", th e Panel focused its examin ation on whether China
met its burden of proving that, in this dispute, 27 per cent of the total domestic production was not a
major proportion. Thus, in the European Union's view, because the Panel "relied on" the agreement
between the parties regarding the legal interpreta tion in developing its reasoning, it is "simply not
credible, nor appropriate" for China to assert on appeal that the interpretation put forward by the Panel
is not permissible.364
213. The European Union further submits that, as th e Panel correctly found, despite the alleged
presumption relied on by the Commission in defining the domestic industry, China failed to establish
that the output of the domestic industry as defined by the Commission, representing 27 per cent of
total domestic production, did not constitute "a major proportion" within the meaning of Article 4.1 of
the Anti-Dumping Agreement . Finally, China's allegation that the Panel erred in rejecting certain
non-quantitative factors is also unfounded. Thes e non-quantitative factors include the alleged

363European Union's appellee's submission, para. 138.
364European Union's appellee's submission, para. 141.

exclusion of certain producers, the practical possib ility to obtain information from all producers, and
the number of producers.
(i) The interpretation of the term "a major proportion"
214. The European Union submits that, becau se the text of Article 4.1 of the Anti-Dumping
Agreement refers to "a major proportion" and does not use terms such as "the majority", this provision
does not require that the domestic industry consis t of producers representing more than 50 per cent of
the domestic production. This interpretati on is supported by the panel's finding in Argentina –
Poultry Anti-Dumping Duties 365, and China does not argue otherwise. The European Union further
maintains that, on the basis of its ordinary meaning, the term "a major proportion" means an
"important, serious or significant" proportion of total domestic output. Although the dictionary
definition relied on by China defines the word "major" as " unusually important, serious or
significant"366, the European Union submits that the qualif ying term "unusually" is not particularly
meaningful.
215. The European Union agrees with China's argume nt that, in order to represent a "proportion",
the production of domestic producers concerned must c onstitute a "part" or "share" of the whole.
However, the European Union asserts that China "m akes an unsubstantiated leap of logic when it
states that '[i]n other words, they must be representative of the whole'". 367 There is nothing inherently
"representative" in the term "proportion", because th e term simply refers to a ratio. Moreover,
because Article 4.1 refers to the "collective output", the term "a major proportion" is to be examined
in relation to the quantity of production. The Euro pean Union further contends that the Appellate
Body's finding in US – Lamb, to which China refers in suppor t of its position, addresses the meaning
of "producers as a whole", and not "a major proportion", and therefore does not lend support to
China's position.368
216. The European Union submits that, without any basis, China asserts that "[t]he reason for
permitting the domestic industry to be define d as those producers constituting only a 'major
proportion' is to address the practical impossibility for investigating authorities in some cases to

365European Union's appellee's submission, para. 147 (referring to Panel Report, Argentina – Poultry
Anti-Dumping Duties, paras. 7.341 and 7.342).
366European Union's appellee's submission, para. 142 (referring to China's other appellant's submission,
paras. 10, 188 and 189). (emphasis added by the European Union)
367European Union's appellee's submission, para. 151 (referring to China's other appellant's submission,
para. 185). (emphasis added by the European Union)
368European Union's appellee's submission, para. 153 (quoting Appellate Body Report, US – Lamb ,
para. 91).

obtain the requested information from a ll the producers of the like product."
369 The European Union
maintains that Article 4.1 merely refers to two a lternative options for defining the domestic industry,
and the word "or" indicates that there is no hi erarchy or preference between these two options.
Moreover, contrary to China's assertions, paragra phs (i) and (ii) of Article 4.1 do not limit the
discretion of the investigating authority, but merely allow the investigating authority to limit the total
number of eligible producers. The European Uni on emphasizes that its interpretation would not, as
China suggests, lead to arbitrary exclusion of categor ies of producers. Rather, if the authority acts in
an objective and unbiased manner in defining the domestic industry by, for example, including only
those producers willing to cooperate, the definition of the domestic industry w ill be consistent with
Article 4.1, even if it consists of producers whose output represents less than 100 per cent of the total
domestic production. Finally, the European Union disagrees with China's argument that Article 3.1 of
the Anti-Dumping Agreement provides contextual support for the proposition that the term "a major
proportion" requires that the domestic industry so defined must be representative of the domestic
producers as a whole. Rather, Article 3.1 imposes oblig ations in respect of injury determination, and
does not impose any obligations in respect of the definition of the domestic industry.
(ii) Whether the domestic industry defined in the fasteners
investigation meets the requirement on "a major proportion"
217. The European Union submits that it is for Ch ina, as the complaining party, to make a
prima facie case that the European Union failed properl y to define the domestic industry in the
fasteners investigation because the collective output representing 27 per cent of total domestic
production did not constitute "a major proportion" within the meaning of Article 4.1 of the
Anti-Dumping Agreement . Before the Panel, although China argued that the Commission wrongly
relied on a presumption that producers accounting for 25 per cent of total domestic production
constituted a major proportion of domestic producti on, China also accepted that, depending on the
circumstances, even a percentage of less than 25 per cent could be sufficient. Thus, the Panel
correctly required China to provide evidence demonstr ating that, in this dispute, 27 per cent was not
an important, serious, or significant part of total domestic production.
218. In the European Union's view, China effec tively alleges that authorities are under an
independent obligation to explain the basis for their conclusion that a certain percentage of production
is "major" in the circumstances of the case. Howeve r, Article 4.1 does not impose such an obligation.
This is confirmed by the panel's finding in Argentina – Poultry Anti-Dumping Duties that authorities
are not under an obligation to elucidate how they found that a percentage lower than 50 per cent could

369European Union's appellee's submission, para. 155 (quoting China's other appellant's submission,
para. 195).

be considered "a major proportion". 370 The European Union maintains that, before the Panel, China
did not deny that the domestic industry as define d included large and small companies, as well as
producers of different types of fasteners. Moreove r, during the fasteners investigation, the Chinese
exporters did not question the representativeness of the domestic industry definition, and the
Commission was therefore under no obligation to addr ess such concerns. In this regard, China's
argument on appeal that the Commission relies on a rule that automatically equates "a major
proportion" with 25 per cent of total domestic production "is in error and entirely irrelevant". 371 This
is because China did not challenge the releva nt provision of the European Union's Basic
AD Regulation concerning such a "rule". Thus, th ese provisions are not before the Appellate Body
and, in any event, there is no evidence on the reco rd demonstrating that the Basic AD Regulation sets
forth a mandatory rule preventing the Commission from concluding, in the specific circumstances of a
case, that 25 per cent does not amount to a major proportion.
219. The European Union nonetheless maintains that the Basic AD Regulation reflects its position
that Article 5.4 of the Anti-Dumping Agreement provides important contextual guidance concerning
the meaning of the term "a major proportion" in Article 4.1 of that Agreement. Specifically,
Article 5.4 provides that a request for initiation of an anti-dumping investigation must be made "by or
on behalf of the domestic industry", and that this will be the case when it is established that domestic
producers supporting the application represent at l east 25 per cent of total domestic production.
Therefore, it is "permissible to consider that producers that represent 25 [per cent] or more of
domestic production can legitimately represent a major proportion of total production and that, as
explained before, this was the case in the fasteners investigation."372
220. With regard to China's claim that the Panel failed to consid er certain non-quantitative factors,
the European Union asserts that Ch ina merely repeats the arguments in support of its view that the
term "a major proportion" requires the domestic i ndustry so defined be representative of the domestic
producers as a whole. The European Union agrees that authorities cannot deliberately exclude a
category of producers. However, if the exclusion only results from the application of a reasonable
deadline, or the consequence of the fact that the industry is fragmented, it is not inconsistent with
Article 4.1 of the Anti-Dumping Agreement. Furthermore, contrary to China's assertion, the number
of producers is not a relevant element in the de finition of the domestic industry, because Article 4.1
concerns the volume of production.

370European Union's appellee's submission, para. 178 (referring to Panel Report, Argentina – Poultry
Anti-Dumping Duties, para. 7.343).
371European Union's appellee's submission, para. 186.
372European Union's appellee's submission, para. 187. (original emphasis)

221. On this basis, the European Union submits that the Panel properly found that China failed to
demonstrate, prima facie , that the definition of domestic industr y in this case is inconsistent with
Article 4.1 of the Anti-Dumping Agreement, and requests the Appellate Body to reject China's appeal.
(c) The Representativeness of the Sample of Domestic Producers in the
Injury Determination
222. The European Union alleges, as a preliminary matte r, that China's appeal concerns the Panel's
rejection of a claim that was not within the Pane l's terms of reference. In its request for the
establishment of a panel
373, China alleged that the European Union acted inconsistently with
Articles 4.1 and 3.1 of the Anti-Dumping Agreement because the Commission conducted the injury
determination on the basis of a sample of produ cers accounting for only 17.5 per cent of the total
European Union production of the like product in 2006. However, in its second written submission
before the Panel, China raised the "entirely new cl aim" that the European Union acted inconsistently
with Article 3.1 of the Anti-Dumping Agreement by using a sample on the basis of the largest volume
that can be reasonably investigated, thereby failing to use a sampling technique that guaranteed that
the sample was sufficiently represen tative of the domestic industry. 374 The European Union argues
that this new claim is in no way related to China's claim under Article 3.1 of the Anti-Dumping
Agreement listed in its panel request, and is therefore not properly before the Appellate Body.
223. The European Union submits that Ch ina's claim under Article 3.1 of the Anti-Dumping
Agreement is in any event without merit. Article 3.1 does not prescribe any methodology for
sampling in the injury determination. Although Article 6.10 of the Anti-Dumping Agreement ,
concerning sampling in the dumping determination, is not directly applicable in the context of injury
determinations, the fact that the Commission followed one of the two sampling methodologies
provided in that provision indicates that its method was not unreasonable or biased. Moreover, as the
Panel correctly found, China failed to present any factors other than volume that should have been
taken into account. The European Union further maintains that there is no basis for China's claim that
the Commission could have included more domestic producers in the sample. The Panel properly
found that the mere fact that certain macro-economic factors were examined on the basis of data from
all 45 producers making up the domestic industry does not demonstrate that the Commission could
have examined all micro-economic factors on the same basis. This finding falls within the Panel's
discretion as the trier of facts, and China makes no claim under Article 11 of the DSU in this regard.

373WT/DS397/3, 13 October 2009.

224. On this basis, the European Un ion requests the Appellate Body to reject China's appeal of the
Panel's finding that the sample selected by the Co mmission was not inconsistent with Article 3.1 of
the Anti-Dumping Agreement.
2. The Panel's Findings under Article 2.4 of the Anti-Dumping Agreement
225. The European Union requests the Appellate Body to reject China's appeal of the Panel's
finding that the European Union did not act inconsistently with Article 2.4 of the Anti-Dumping
Agreement in respect of the comparison of the export price and normal value in the dumping
determination. According to the European Union, each of China's three claims on appeal is without
merit and should be rejected.
(a) The Panel's Treatment of China's Argument
226. The European Union submits that China's allega tion of a violation of Article 11 of the DSU
by the Panel for its alleged failure to address Ch ina's argument on the EU authorities' lack of
communication on the information required to ensure a fair comparison is baseless.
227. The European Union maintains that the "fact ual premise for China's claim is in error" 375,
because China did not make a claim, nor a substa ntial argument, before the Panel concerning the
Commission's alleged failure to inform interested par ties of the fact that PCNs were not used in price
comparison. Rather, China raised this issue before the Panel in it s second written submission merely
in rebuttal of the European Union's argument that no interested parties had requested adjustments, and
in support of its claim that adjustments should have been made. The Panel therefore did not "ignore[]
a substantial argument put forward by China" 376, because the Panel was not requested to opine on
such an argument. The European Union further submits that China's references to the Appellate
Body's findings on "false exercise of judicial economy" are "completely besides the point", given that
those findings deal with the decision of a panel not to address certain "claims" before it, not
"arguments".377 Moreover, because panels have the discr etion to address only those arguments they
deem necessary to resolve a particular claim, "the f act that a particular argument relating to that claim
is not specifically addressed in the 'Findings' section of a panel report will not, in and of itself, lead to
the conclusion that that panel has failed to make the 'objective assessment of the matter before it'

375European Union's appellee's submission, para. 249.
376European Union's appellee's submission, para. 252 (quoting China's other appellant's submission,
para. 306).
377European Union's appellee's submission, para. 255.

required by Article 11 of the DSU".
378 Thus, the European Union submits that China fails to
demonstrate that the Panel acted inconsistently w ith Article 11 of the DSU by not addressing China's
argument.
228. The European Union further contends that China fails to substantiate its alternative claim that,
should the Appellate Body consider that the Panel implicitly rejected China's argument, the Appellate
Body should find that the Panel erred in its interpretation of Article 2.4 of the Anti-Dumping
Agreement. In the European Union's view, given that the Panel did not make a finding in this respect,
and did not exceed the boundaries of its discretiona ry authority in not addressing China's argument,
there is no basis for the Appellate Body to review th is alleged error in law in respect of a non-existent
finding.
(b) Physical Differences
(i) The Panel's interpretation and application of Article 2.4
229. The European Union maintains that China's allegation of the Panel's error in the interpretation
and application of Article 2.4 of the Anti-Dumping Agreement , concerning the Commission's
obligation to evaluate all PCN characteristics and to make necessary adjustments, is equally without
merit. According to the European Union, the Pa nel's legal interpretation of Article 2.4 of the
Anti-Dumping Agreement "is in line with the interpretation" advocated by China that an authority
must evaluate identified differences potentially affecting price comparability.379 This is confirmed by
the Panel's finding that, under Article 2.4, the author ities "must take steps to achieve clarity as to the
adjustment claimed and then determine whether and to what extent that adjustment is merited".380
230. The European Union submits that China's appeal does not concern an issue of law, but rather
concerns China's disagreement with the Panel's fact ual finding regarding the role and relevance of the
PCN characteristics, and fails to "convincingly" challenge this finding under Article 11 of the DSU.381
The European Union recalls China's argument before the Panel that, because the PCN characteristics
had been identified by the authorities themselves as affecting price comparability, the Commission
had an obligation at least to evaluate whether th ese differences indeed affected price comparability or
not, and should subsequently have concluded that adjustments were indeed required. Thus, China's
argument is premised on the assumption that the Commission had identified PCN characteristics as

378European Union's appellee's submission, para. 255 (quoting Appellate Body Report, EC – Poultry ,
para. 135).
379European Union's appellee's submission, para. 272.
380European Union's appellee's submission, para. 271 (quoting Panel Report, para. 7.298, in turn
quoting Panel Report, EC – Tube or Pipe Fittings, para. 7.158 (boldface added by the Panel)).
381European Union's appellee's submission, para. 263.

affecting price comparability. The Panel, however, disagreed with the "factual premise" of China's
assertion382, finding, instead, that the fact that th e Commission used the PCNs as a tool for
information gathering did not imply that the Commission identified each of the PCN characteristics as
necessarily affecting price comparability. The Panel further found that China pointed to no evidence
that was before the investigating authority in su pport of its assertion that the Commission considered
all PCN characteristics as necessarily affecting pri ce comparability. In the European Union's view,
these are factual findings unrelated to whether or not there exists a distinction, as alleged by China,
between the evaluation of identified differences and the making of adjustments for differences
affecting price comparability.
231. The European Union further maintains that, in any event, pursuant to a proper interpretation
of Article 2.4 of the Anti-Dumping Agreement , the European Union complied with its obligations
under that provision. First, Article 2.4 requires an investigating authority to request information that
may be necessary for ensuring a fair comparison a nd to determine whether any adjustments are
warranted. The European Union requested all inte rested parties to organize product information on
the basis of the PCNs "merely [as] a tool" 383 to help matching export sales to domestic sales in the
analogue country. Second, under Article 2.4, it is the obligation of the producers from the country
under investigation to substantiate their claim for adjustment. The European Union recalls that the
interested parties emphasized, throughout the fasteners investigation, the importance of the distinction
between standard and special fasteners, and the Commission took into account this distinction in the
product types used for purposes of price comparison. Third, under Article 2.4, an investigating
authority is only required to adjust for differences that are demonstrated to affect price comparability,
and not for any other differences. Consistent with this obligation, the Commission determined that
only one of the PCN characteristics, that is, strength, was demonstrated to affect price comparability.
In this respect, the European Un ion argues that China makes an in accurate factual statement that
"interested parties have stressed throughout the in vestigation that it was of fundamental importance
that the comparison be made on the PCN basis". 384 Therefore, the Commission complied with all of
the obligations under Article 2.4 of the Anti-Dumping Agreement and conducted a fair comparison
between normal value and export price by making a comparison between fast eners on the basis of
their strength class and whether they were special or standard fasteners.
232. On this basis, the European Union requests the Appellate Body to reject China's appeal
against the Panel's finding that the Commission did not act inconsistently with Article 2.4 of the

382European Union's appellee's submission, para. 267.
383European Union's appellee's submission, para. 277.
384European Union's appellee's submission, para. 287 (quoting China's other appellant's submission,
para. 360).

Anti-Dumping Agreement in not making adjustments for alle ged differences indicated through the
PCN characteristics.
(ii) The Panel's failure to make an objective assessment of the
facts
233. The European Union submits that, before addr essing China's specific claims, it may be useful
to recall the role of the PCNs in the fasteners inv estigation. According to the European Union, the
PCNs are an information-gathering tool, consisting of "a very preliminary listing" of potentially
relevant product features that may or may not affect price comparability.
385 Whether the PCNs will
ultimately be used depends on numerous factors, including the arguments of the parties, and the
practical limitations of the information available. In the fasteners investiga tion, the European Union
argues, the failure of the Indian producer to pr ovide the information in the detailed manner required
by the PCNs implied that a different appro ach based on product types became preferable.
Furthermore, the evidence on the record indicates that strength class and the distinction between
standard and special fasteners, on the basis of wh ich the Commission determined the product types,
were two main characteristics referred to by the inte rested parties in the course of the investigation,
including the Chinese interested parties. The Eu ropean Union further submits that the Chinese
interested parties did not raise any other char acteristics affecting price comparability during the
investigation, even after they were informed that the price comparison was done on the basis of
product types rather than PCNs. China's argument , that the interested parties did not request
adjustments because they assumed that any differences affecting price comparability would be taken
into account by the PCN characteristics, is contradict ed by the fact that the Chinese interested parties
presented arguments during the investigation regarding the importance of strength class even though
strength class was one of the PCN characteristics.
234. Turning to China's allegation that the Panel acte d inconsistently with Article 11 of the DSU,
the European Union maintains that China has not po inted to any evidence that was disregarded by the
Panel. First, China repeats its erroneous assertion th at the fact that certain physical characteristics
were reflected in the PCNs provi des evidence that such characteristics affect price comparability.
Yet, as the Panel correctly found, the use of the PCNs as an information-gathering tool did not mean
that the characteristics indicated therein necessarily affect price comparability. Second, although
China submitted to the Panel that the Co mmission should have made adjustments for
PCN characteristics such as the type of coating a nd the use of chrome, it did not made such claims
before the Commission. The European Union emphasizes that the Panel's duty was to review whether

385European Union's appellee's submission, para. 292.

the Commission's determination was reasonable in th e light of the evidence before the Commission,
rather than assertions made during the Panel procee dings. Third, with regard to the three pieces of
evidence that China alleges it submitted to the Panel, the first two were statements by the EU industry
made in the context of discussions concerning th e comparability between EU and Chinese fasteners,
and thus did not concern the issue of price compar ability between Indian and Chinese fasteners. As
for the third piece of evidence, it concerns a pr esentation on behalf of a Chinese interested party
stressing the need to differentiate fasteners based on standard market and niche products, which also
does not address the alleged importance of the PCN ch aracteristics. Thus, China fails to demonstrate
that the Panel wilfully disregarded, distorted, or refused to consider the ev idence submitted by China.
Rather, the Panel examined all evidence in its to tality, including China's acknowledgement that no
interested parties raised any factors affecting pri ce comparability other than those taken into account
by the Commission, and reach ed its conclusion on that basis. Th e Panel did not violate Article 11 of
the DSU simply because it did not discuss every piece of evidence or every argument made by China.
235. The European Union contends that China neither substantiates, nor provides any evidence for,
its allegation that the Panel acted incons istently with Article 17.6(i) of the Anti-Dumping Agreement.
As the Panel found, China had pointed to no evidence that was before the i nvestigating authorities in
support of its assertion that all PCN characteri stics constituted differences affecting price
comparability. Because the task of the Panel was to review the reasonablen ess of the Commission's
determination, the Panel rightly considered that it should not engage in a review of such evidence to
determine whether it would have reached a different conclusion. Therefore, China's appeal in this
respect, as well as its request for completion of the analysis, must be rejected.
(c) Quality Differences
236. The European Union maintains that, although Chin a alleges that the Panel erred in its legal
interpretation, China's appeal does not point to any legal errors by the Panel in the interpretation of
Article 2.4 of the Anti-Dumping Agreement. Rather, the interpretation advanced by China is in line
with the Panel's finding that an authority must exam ine whether and to what extent adjustments must
be made. The European Union further submits th at it agrees that characteristics that have been
acknowledged to affect price comparability, or for which the requisite evidence has been provided,
must be evaluated in order to determine whether and to what extent adjustments may need to be made.
237. In this dispute, however, there was no evidence of any difference in quality that affected price
comparability between Chinese and Indian fasteners. Specifically, with respect to the letter from one
Chinese producer requesting adjustments for quality differences, the Panel correctly found that the
letter was not supported by any evidence. Moreover, China's assertion that the Commission failed to

evaluate, and make adjustments for, quality diffe rences is based on a misreading of the Definitive
Regulation. As the Panel rightly found, the rec ital in the Definitive Regulation to which China
referred concerns fasteners produced in China and in the European Union, and does not even mention
fasteners produced in India. Moreover, the lette r from the Commission to some Chinese exporters
does not refer to any quality differences, but indicates that the only difference for which an adjustment
was made consisted of the fact that the Indian pr oducer regularly checked the quality before shipping,
whereas the Chinese producers generally did not do so.
238. Therefore, the European Union argues, China's claim under Article 2.4 of the Anti-Dumping
Agreement is based on the erroneous factual premise that the Commission acknowledged that certain
quality differences existed. Given that the Panel correctly found that there was no evidence showing
that the Commission made such an acknowledgement , the European Union requests the Appellate
Body to reject China's appeal that the Panel erred in finding that the Commission did not act
inconsistently with Article 2.4 of the Anti-Dumping Agreement by not evaluating, and making
adjustments for, quality differences.
3. The Panel's Findings under Article 6.5, 6.2, and 6.4 of the Anti-Dumping
Agreement Regarding the Disclosure of the Identity of the Complainants
239. The European Union requests the Appellate Body to uphold the Panel's findings under
Article 6.5 of the Anti-Dumping Agreement with respect to the disclosure of the identity of the
complainants and the supporters of the complaint. As a preliminarily matter, the European Union
raises two jurisdictional concerns. First, th e European Union points out that the claim under
Article 11 of the DSU brought by China in its othe r appellant's submission was not included in its
Notice of Other Appeal, and is therefore not properly before the Appellate Body. 386 Second, in the
European Union's view, China's argument regardin g the disclosure of the identity of the sampled
producers seems to challenge the Panel's weighing of the evidence, and should more properly have
been raised under Article 11 of the DSU. As Artic le 11 was not mentioned in China's Notice of Other
Appeal in this context, this claim too should be dismissed by the Appellate Body as outside the scope
of appellate review. 387 Substantively, the European Union ar gues that the Panel correctly found that
the European Union acted consistently with Article 6.5 when it treated the complainants' identity as
confidential in order to prevent co mmercial retaliation by some of their customers. As a consequence
of upholding the Panel's finding in this regard, the European Union also requests the Appellate Body
to uphold the Panel's consequential finding that the European Union acted consistently with
Articles 6.4 and 6.2 of the Anti-Dumping Agreement.

386European Union's appellee's submission, para. 362.
387European Union's appellee's submission, para. 363.

(a) The Complainants' "Good Cause" Showing
240. The European Union observes, at the outset, that China does not challenge the Panel's
findings that the Commission's standing determinati on was consistent with its obligations under the
Anti-Dumping Agreement, and China thereby "confirms" that the identity of these companies was a
"non-issue from the point of view of the interested parties' rights of defence". 388 In response to
China's specific claims, the European Union disagr ees with China's suggestion that a higher threshold
must be reached in order to show "good cause" in the case of information that is not "by nature"
confidential. Rather, the European Union concurs with the Panel's determination that the relevant
issue was "whether the justification based on pot ential commercial retaliation provided by the
complainants in the fasteners investigation could amount to 'good cause' in the sense of Article 6.5".389
241. Regarding China's claim that the complainants were required to demonstrate the commercial
retaliation "would", as opposed to "could", happen, the European Union contends that "China's
distinction is artificial". 390 The use of the term "would" in Article 6.5 appears as part of some
examples of information that is confidential by nature, and does not imply that in all cases the
submitting party must show that harm will unavoidably result. In the European Union's view, China's
proposition does not appear to cover a "risk" that some harm might occur, and ignores the purpose of
Article 6.5, which is "precisely to make sure that a feared adverse effect … remains hypothetical and
does not actually materialise".
391 In the European Union's view, China's interpretation would alter the
balance under Article 6.5, not in favour of par ties requesting confidential treatment of their
information, but decidedly against them, and woul d "discourage the initiation of investigations and
cooperation overall".392
242. The European Union counters China's claim th at the Panel relied on a "mere assertion" to
justify "good cause" by arguing that the Panel did examine "the evidence in light of the specific
justification provided as 'good cause'", and took into c onsideration the "particular standard of review"
the Panel had in reviewing decisions of an investigating authority.393 The European Union asserts that
commercial retaliation can be carried out in sophis ticated and subtle ways, and therefore a party's
ability to supply proof that such reta liation might occur is very difficult. 394 Given this difficulty, the
Panel logically looked next for any evidence to show "that the fear of retaliation was unreasonable,

388European Union's appellee's submission, para. 365.
389European Union's appellee's submission, para. 369.
390European Union's appellee's submission, para. 371.
391European Union's appellee's submission, para. 371.
392European Union's appellee's submission, para. 372.
393European Union's appellee's submission, para. 375.
394European Union's appellee's submission, para. 376.

unfounded or untrue".
395 The Panel did not violate Article 11 of the DSU in expecting that China
should provide evidence in this respect because, the European Union argues, the normal rules of
dispute settlement proceedings in fact require the complainant—in this case China—to make a
prima facie case of inconsistency. 396 In any event, the European Union claims that the Panel did not
find that "no evidence" existed to support the complainants' asser tion that their customers also
purchased the subject product from Chinese producers. Rather, this assertion itself was "essential" to
the Panel's findings and "served to substantiate" the complainan ts' concerns about commercial
retaliation.397 Further, the European Union explains th at the fact that more evidence of potential
commercial retaliation was not disclosed does not imply that such evidence was not before the
Commission, particularly with regard to the nature and operation of the fasteners market itself.398
243. The European Union considers that China's clai m regarding the disclosure of the identity of
the sampled domestic producers essentially challenges the Panel's weighing of the evidence and, as an
Article 11 claim has not been raised, therefore falls outside of the scope of this appeal. 399 China's
claim relies on its own allegation that the evidence before the Panel unequivoca lly demonstrated that
all sampled producers were also supporters of the co mplaint, and that the disclosure of the sampled
producers' identity effectively disclosed the identity of the supporters of the complaint as well. The
European Union contends, however, that China's pres entation of the evidence is incomplete, and that
the same document extensively cited by China al so states that the data and figures presented
"correspond to two different sets of companies ", referring to the sets of companies who either
supported the complaint or coope rated with the investigation. 400 China's claim that the Panel relied
solely on the European Union's assertion that "at least one company included in the sample was not, in
fact, either a complainant or supporter of the comp laint" is, in the European Union's view, not only
"unfounded", but also "blatantly outsi de the Appellate Body's jurisdiction". 401 Finally, the
European Union emphasizes the fact that it is sp ecifically the identification of a company as an
initiator of an investigation that would create a hazard "analogous to the risk of a whistleblower".402

396European Union's appellee's submission, para. 378.
397European Union's appellee's submission, para. 379.
398European Union's appellee's submission, para. 380 and footnote 338 thereto.
399European Union's appellee's submission, para. 363.
400European Union's appellee's submission, para. 384 (quoting European Union's oral statement at the
second Panel meeting, paras. 100 and 101). (boldface added by the European Union on appeal)
401European Union's appellee's submission, para. 387.
402European Union's appellee's submission, para. 385.

(b) Disclosure under Articles 6.4 and 6.2 of the Anti-Dumping
Agreement
244. The European Union raises no substantive argumen ts in response to China's request that the
Appellate Body complete the analysis to find that , because the identity of the complainants was not
properly treated as confidential, the Commission's failure to disclose the company names was also
inconsistent with Article 6.4 and 6.2 of the Anti-Dumping Agreement . If the Appellate Body
determines that these claims were within the Panel's jurisdiction, the European Union requests that the
Panel's findings that the European Union did not act inconsistently with Articles 6.4 and 6.2 be
upheld. Because China's claims under Articles 6.4 and 6.2 are "entirely dependent" on its claim under
Article 6.5, the European Union maintains that the Pa nel did not err in finding that the identity of the
complainants was confidential information under Ar ticle 6.5, and therefore cannot have erred in
finding that the European Union did not violate Articles 6.4 and 6.2.
4. The Panel's Findings that the MET/IT Claim Form Was Not a
"Questionnaire" for Purposes of Article 6.1.1 of the Anti-Dumping Agreement
245. As a preliminary matter, the European Union argues that China can only succeed on its claims
under Article 6.1.1 of the Anti-Dumping Agreement if the Appellate Body reverses the Panel's
interpretation of the term "questionnaires", because China's alternative claim under Article 11 of the
DSU was not mentioned in its Notice of Other A ppeal and is therefore not properly before the
Appellate Body. The European Union requests, how ever, that the Appellate Body uphold the Panel's
findings under Article 6.1.1, because its interpretati on of the term "questionnaires" is also supported
by two previous panel reports 403, and because the alternative interpretation suggested by China would
render the meaning of the term "questionnair es" "arbitrary and dependent on a case-by-case
analysis".404 In fact, the European Union states that it adopts the panel's reasoning in US –
Anti-Dumping and Countervailing Duties (China) , which dealt with the parallel provision in the
Agreement on Subsidies and Countervailing Measures (the "SCM Agreement"), as its own.405
246. The European Union further argues that the dic tionary definition of the word "questionnaire"
does not amount to its "ordinary meaning" for pur poses of interpretation, because this can only be
discerned with reference to its context and in the light of its object and purpose. As the panel in US –
Anti-Dumping and Countervailing Duties (China) found, the broad language in the chapeau of
Article 6.1 confirms the fact that not every requ est for information will fall under "the specific 30-day

403European Union's appellee's submission, paras. 410-415 (quoting Panel Report, Egypt – Steel Rebar,
paras. 7.276 and 7.277; and Panel Report, US – Anti-Dumping and Countervailing Duties (China) ,
paras. 15.23-15.37).
404European Union's appellee's submission, para. 418.
405European Union's appellee's submission, para. 416.

'ample opportunity' rule" set out in Article 6.1.1.
406 The European Union contends that this contextual
interpretation of the term "questionnaires" as applying only to the initial, comprehensive questionnaire
is further supported by the consistent use of th e singular form of the term in footnote 15 of
Article 6.1.1, and in Annex I to the Anti-Dumping Agreement.407 The European Union further argues
that the question of whether or not an informati on request is "so substantial" that it warrants
verification, or whether allowing 30 days for its return will interfere with the authority's timely
completion of the investigation, are both issu es that will require a case-by-case determination
depending on the circumstances in a particular i nvestigation, and should not form part of the
definition of the term "questionnaires".408
247. Should the Appellate Body find that China's alte rnative claims are prope rly raised on appeal,
the European Union asserts that the Panel righ tly found that the MET/IT Claim Form did not
constitute a "questionnaire" under the Panel's inte rpretation. Although some of the information
contained in the MET/IT Claim Form may overlap with information requested in more comprehensive
questionnaires, the European Union argues that the MET/IT Claim Form serves an entirely different
purpose from such questionnaires, and is much narrower in scope. 409 Were the Appellate Body to
agree with China's suggested application of Article 6.1.1, it would have to find that every information
request that "plays a role" in the investigation would fall under the term "questionnaire" and require
30 days for completion410, a result the European Union urges the Appellate Body to reject.
E. Arguments of the Third Participants
1. Brazil
248. Brazil disagrees with the Panel's finding that ther e is solely one exception to the obligation in
Article 6.10 of the Anti-Dumping Agreement to determine individual dumping margins to each known
exporter or producer of the product under investiga tion. Brazil contends that there are various
plausible interpretations of the second sentence of Article 6.10 of the Anti-Dumping Agreement. In
cases where multiple interpretations of a treaty pr ovision are "possible", the Appellate Body has
clearly stated that customary rules of interpreta tion require interpreters to avoid assuming that the
most burdensome obligation was the one intended by the drafters of the treaty. 411 In Brazil's view, it
seems "reasonable" to interpret the second sentence of Article 6.10 as one specific, but not the sole,

406European Union's appellee's submission, para. 420.
407European Union's appellee's submission, para. 420.
408European Union's appellee's submission, paras. 421-423.
409European Union's appellee's submission, para. 429.
410European Union's appellee's submission, para. 431.
411Brazil's third participant's submission, para. 12 (referring to Appellate Body Report, EC – Hormones,
para. 165).

exception to the first sentence of Article 6.10. Ind eed, the use of "as a rule" in the first sentence of
Article 6.10 reveals the general nature of the oblig ation, merely expressing preference for the use of a
specific methodology. This conclusion is further c onfirmed by the French and the Spanish versions,
which begin, respectively, with the expressions " en règle générale " and " por regla general ". In
contrast, there are no limiting or restrictive expr essions, such as "unless" or "only in cases where", in
the second sentence of Article 6.10 of the Anti-Dumping Agreement.412
249. Brazil contends that one of the situations in which the general rule of individual dumping
margin calculation contained in the first sentence of Article 6.10 of the Anti-Dumping Agreement is
not applicable is where prices and costs are not established according to market economy rules. This
conclusion is supported in Article 2.7 of the Anti-Dumping Agreement , which refers to the second
Ad Note to Article VI:1 of the GATT 1994, and, in the particular case of China, reinforced by
paragraph 15(a)(ii) of China's Accession Protocol. Pursuant to these provisions, investigating
authorities may use, when determining the dump ing margin, a different methodology for price
comparability than the one resulting from Articles 2 and 6.10 of the Anti-Dumping Agreement. Brazil
notes that, in Korea – Certain Paper , the panel recognized that there may be situations in which
treating separate legal entities as a single exporte r for determining dumping margins is a proper,
WTO-consistent methodology. 413 Although this precedent refers to an investigation concerning
companies that operated under market economy conditi ons, it is Brazil's contention that in the case of
NMEs the motives for "single exporter" treatment are all the more justified. 414 The Panel itself
recognized that it is possible to consider all co mpanies operating under NME conditions as one single
exporter together with the State, but such a statem ent seems to be in contra diction with the Panel's
final conclusion that sampling is the only exception to the obligation to determine individual dumping
margins.415
250. Regarding the presumption established by Article 9(5) of the Basic AD Regulation with
respect to the relationship between investigated companies and the State in NMEs, Brazil considers
that the Panel erred in finding that such a presu mption has no legal basis. In Brazil's view,
investigating authorities are permitted under WTO la w to place on Chinese exporters or producers the
burden of proving that their industry is subject to market economy conditions in its functioning, which
includes showing that they operate independently from the State. The expressions "can/cannot clearly
show" in Article 15(a)(i) and (ii) are the key textual element indicating that the treatment accorded to

412Brazil's third participant's submission, para. 9.
413Brazil's third participant's submission, para. 26 (referring to Panel Report, Korea – Certain Paper ,
para. 7.161).
414Brazil's third participant's submission, para. 28.
415Brazil's third participant's submission, para. 30.

Chinese exporters or producers is dependent upon their capacity to show that market economy
conditions prevail in their industry. Brazil furthe r contends that, since NME conditions constitute a
factor that Members have recognized to affect price comparability, information on price comparability
falls into the scope of Article 2.4 of the Anti-Dumping Agreement. Therefore, placing the burden of
proof regarding the existence of market economy c onditions on the Chinese exporters or producers is
permitted under Article 2.4 of the Anti-Dumping Agreement, as long as this burden is reasonable.
416
251. With respect to Article 9.2 of the Anti-Dumping Agreement , Brazil rejects the Panel's
conclusion that, given the similarities betw een Article 9.2 and Article 6.10 of the Anti-Dumping
Agreement, the obligation to name the suppliers corres ponds to the obligation to calculate individual
dumping margins. 417 Brazil submits that the Anti-Dumping Agreement addresses, in distinct
provisions, the determination of dumping margins and the imposition of anti-dumping duties, and
considers that the Panel's parallelism between thes e core provisions is far-fetched. The textual
differences between Article 9.2 and Article 6.10 are a clear indication that Members intended them to
have different scopes. In addition, both in US – Gasoline and EC – Hormones , the Appellate Body
affirmed that a treaty interpreter must not ignore th e choice of different words in the text of treaty
provisions.418 In referring to the naming of the c oncerned suppliers, Article 9.2 of the Anti-Dumping
Agreement does not establish any other obligation than the naming itself, thus there is no need for the
investigating authorities to impose different duties on each of them. In Brazil's view, the investigating
authorities may rightfully impose the same anti-dumpi ng duty to all known exporters or producers as
long as it is equal to, or less than, the sma llest dumping margin established to these
exporters/producers.419
2. Colombia
252. With respect to the interpretation of Article 6.10 of the Anti-Dumping Agreement, Colombia
disagrees with the Panel's finding that the rule in this provision does not admit more exceptions than
only sampling. Colombia considers that a single dumping margin can also be determined if, after
having assessed the evidence available, the investig ating authorities conclude that the producers and
exporters in an NME are deemed a single entity with the State. Colombia considers, however, that
there is no direct legal basis within the WTO le gal framework for a general presumption that all
producers and exporters in an NME are a single entity with the State for the purposes of the
determination of a dumping margin and the impos ition of anti-dumping duties. Therefore, the

416Brazil's third participant's submission, para. 40.
417Brazil's third participant's submission, para. 45.
418Brazil's third participant's submission, paras. 49 and 50 (referring to Appellate Body Report, US –
Gasoline, p. 17, DSR 1996:I, 3, at 16; and Appellate Body Report, EC – Hormones, para. 164).
419Brazil's third participant's submission, para. 56.

assessment of a link between the producers/exporters and the State is a matter of evidence and should
be done on a case-by-case basis. Colombia reads Ar ticle 9(5) of the Basic AD Regulation as setting
out the evidentiary threshold to establish a link be tween producers/exporters and the State in NMEs
for the purposes of the dumping margin determinati on. In Colombia's view, as long as this threshold
provides the elements to collect th e evidence necessary to demonstrate that such a link does not exist,
it is consistent with Article 6.10 of the Anti-Dumping Agreement. Colombia further submits that the
Appellate Body can take into account China's Ac cession Protocol and the Accession Working Party
Report as guidance in relation to the Members' c oncerns regarding anti-dumping investigations
concerning products from China.420
253. Colombia disagrees with the Panel's interpretation of Article 9.2 of the Anti-Dumping
Agreement and rejects the Panel's conclusion that Ar ticle 9.2 does not permit the imposition of a
single country-wide anti-dumping duty in an investigation involving an NME. In Colombia's view,
rejecting the European Union's interpretation of th e term "appropriate" in Article 9.2, as referring to
the duty rate appropriate to the country concerned, could lead to a situation where, even if the
"appropriate" amount of anti-dumping duty to be coll ected is a country-wide one, such country-wide
anti-dumping duty cannot be imposed. This would limit the possibility for Members to collect the
appropriate amount of anti-dumping duties in a given case. 421 Colombia reiterates its understanding
that, since there is no legal basis for a general evidentiary presumption that producers and exporters
act as a single entity under the control of the State in NMEs, an investigating authority needs a factual
basis to support a conclusion that a single, country-wide anti-dumping duty must be imposed.
Article 9(5) of the Basic AD Regulation sets out the evidentiary threshold that the European Union
applies to determine what type of relationship exis ts between exporters and producers and the State in
NMEs, and, as long as such threshold provides evidence of a link, this can be considered as a factual
basis for the imposition of a single, country-wide anti-dumping duty.
422
254. Colombia agrees with the Panel's finding that th e determination of how to group products by
product type was the kind of "information" covere d by the requirements of Article 6.4 of the
Anti-Dumping Agreement. In EC – Tube or Pipe Fittings , the panel defined the kind of information
that Article 6.4 requires authorities to disclose as "information that would not initially be in the
possession of an interested party and would therefor e be unknown or unfamiliar to an interested party
if it were not disclosed to that part y in the course of an investigation". 423 Taking this definition into

420Colombia's third participant's submission, para. 13.
421Colombia's third participant's submission, para. 23.
422Colombia's third participant's submission, para. 28.
423Colombia's third participant's submission, para. 30 (quoting Panel Report, EC – Tube or Pipe
Fittings, para. 7.208).

consideration, Colombia submits that the qualif ication of how to group the products in the
investigation falls within the scope of in formation covered by Article 6.4 of the Anti-Dumping
Agreement, and highlights the fact that product groupi ng defines how the producers and exporters
under investigation will substantiate their defence.
424
3. Japan
255. Japan agrees with the Panel's finding that th e first sentence of Article 6.10 establishes an
obligation to determine an individual dumping ma rgin for each individual exporter or producer
concerned, with only one exception, namely, th e possibility of sampling specified in the second
sentence of Article 6.10. In Japan's view, Article 6. 10 is purely procedural in nature, in the sense that
it imposes a procedural obligation to determin e individual margins of dumping for each known
exporter or producer, and it is not concerned with substantive issues regarding the determination of
individual dumping margins. 425 Therefore, provisions covering substantive issues, such as Articles 2
and 6.8 of the Anti-Dumping Agreement , cannot be deemed exceptions to the rule set out in
Article 6.10. In addition, the manner in which an investigating authority may define "exporter" or
"producer" within the meaning of the first sent ence of Article 6.10 has nothing to do with the
relationship between the first and the sec ond sentences of the Article 6.10 of the Anti-Dumping
Agreement.426
256. Japan further submits that the Panel's reading of Korea – Certain Paper may be too narrow,
especially in its application in the context of NMEs . In Japan's view, the principles derived from that
precedent—that is, that distinct legal entities may be treated as a single exporter or producer if they
"are in a relationship close enough to support that treatment" 427—equally apply to the relationship
between the State and private legal entities. In that sense, Japan has doubts as to whether the
operation of Article 9(5) of the Basic AD Regulati on is indeed "fundamentally different" from the test
in Korea – Certain Paper as the Panel concluded. Japan also queries whether the question of who
carries the burden of proving whether distinct entities are in a close enough relationship to be
considered a single exporter or producer is releva nt for the interpretation of Article 6.10 of the
Anti-Dumping Agreement, insofar as this provision makes no refere nce to the burden of proof. In any
event, Japan considers that Article 15(a) and (d) of China's Accession Protocol, which places the

424Colombia's third participant's submission, para. 32.
425Japan's third participant's submission, para. 8.
426Japan's third participant's submission, para. 9.
427Japan's third participant's submission, para. 14 (quoting Panel Report, Korea – Certain Paper ,
para. 7.161).

burden of proof on the producers under investigation or on China itself, appears to provide relevant
context in that respect.428
257. Japan supports the Panel's finding that "sour ces" and, by implication, "suppliers" in
Article 9.2 of the Anti-Dumping Agreement can be interpreted as referring to the State where it is
demonstrated that the State is the actual producer or exporter of the product in question. 429 Likewise,
Japan supports the European Union's argument that the State can be the source of price
discrimination. However, Japan queries whether the Panel provided a sufficient basis to conclude that
Article 9.2 of the Anti-Dumping Agreement prohibits Members to presume that the State in an NME is
the source of price discrimination. In Japan's view, it is at least questionable whether Members would
not, in any event, be allowed to presume that the Chinese State is the source of price discrimination on
the basis of Article 15(a) and (d) of China's Acce ssion Protocol, read togeth er with paragraph 151 of
China's Accession Working Party Report. Japan ma intains, however, that any presumption in that
regard must be rebuttable.
430
258. Japan disagrees with the Panel's finding that th e term "impracticable" in Article 9.2 of the
Anti-Dumping Agreement must be interpreted as in Article 6. 10, namely, in reference to a large
number of producers or exporters. In Japan's view, the impracticability of naming all the suppliers, as
provided for in the third sentence of Article 9.2, re lates to the collection of the appropriate amount of
anti-dumping duties, as provided for in the first sentence of Article 9.2. A high risk of circumvention
may be one reason for it to be impracticable to na me each individual producer or exporter for which
an anti-dumping margin was calculated.
431 Given the context, the scope of the third sentence of
Article 9.2 could well be given a broader interpretation than the situation described in the second
sentence of Article 6.10, namely, the sampling excepti on. Japan notes that there is no reference in the
text of either Article 9.2 or Article 6.10 indicati ng that the exceptions contained respectively in the
third and second sentences of each provision must be read together; and it adds that whereas
Article 6.10 explicitly qualifies the "impractic ability" as referring to only one specific situation
("where the number of exporters, producers, importer s or types of products involved is so large"),
Article 9.2 provides no such explicit, nor even implicit, limitation.432

428Japan's third participant's submission, para. 18.
429Japan's third participant's submission, para. 20 (referring to Panel Report, footnote 278 to
para. 7.103).
430Japan's third participant's submission, para. 24.
431Japan's third participant's submission, para. 33.
432Japan's third participant's submission, para. 36.

4. United States
259. The United States argues that the Panel erred in its interpretation that Article 6.10 of the
Anti-Dumping Agreement prohibits investigating authoriti es from requiring NME exporters or
producers to show their independence from the State before providing them with an individual margin
of dumping. In the United States' view, the Pane l's interpretation of Article 6.10 as prescribing a
single rule for how investigating authorities must weigh evidence in all cases does not accord with the
recognition elsewhere in the WTO Agreements that NMEs may present additional factual
complexities in an anti-dumping investigation.
433 The United States maintain s that the interpretative
second Ad Note to Article VI:1 of the GATT 1994 r ecognizes that price comparisons with domestic
prices may not be possible in an NME where State interference is pervasive, and allows Members to
apply an alternative price comparison methodology by basing the normal value on data from an
analogue country. Moreover, China's Accession Protocol recognizes the pervasive government
interference in the Chinese economy, allowing Members to establish different evidentiary
requirements for firms operating in China. Specifically, the Protocol recognizes that, absent a
demonstration to the contrary by Chinese producer s, government interference will prevent market
principles from functioning in the relevant industry producing the product under consideration.
434
260. The United States further submits that the Panel e rred in its interpretation that Article 6.10 of
the Anti-Dumping Agreement prohibits an investigating authority from using criteria, such as those
established in Article 9(5) of the Basic AD Regulati on, to determine whether a firm is sufficiently
separate from the State to determine an individual ma rgin of dumping for that entity. According to
the United States, the Anti-Dumping Agreement neither defines "exporter" nor "producer", nor sets out
criteria for the investigating authority to examine befo re concluding that a part icular firm or group of
firms constitute an "exporter" or "producer". 435 Therefore, the determination of whether a firm
constitutes the relevant exporter or producer, incl uding the selection of criteria to employ in making
this determination, would appear to fall within the discretion of the investigating authority. The
United States contends that, in a NME such as Ch ina, State interference could exert influence over
firms and prices, thus making the State analogous to a parent company that makes business decisions
for the individual firms. Furthermore, there is subs tantial evidence that such State interference exists
in the Chinese economy, such as concerns express ed by Members in this regard during China's
accession negotiations. 436 Therefore, contrary to the Panel's finding, it is logical for the

433United States' third participant's submission, p. 12.
434United States' third participant's submission, para. 13.
435United States' third participant's submission, para. 16.
436United States' third participant's submission, para. 19 (referring to China's Accession Working Party
Report, paras. 50, 51, and 150).

European Union's investigating authority to confir m that a Chinese company functions as an exporter
or producer separate from the State before assigning an individual dumping margin to that company.
The United States disagrees with China's argument that requiring companies from NMEs to
demonstrate that they qualify for individual dumping margins results in the application of a rigid and
burdensome rule to Chinese firms. Rather, such a requirement provides investigating authorities with
the necessary flexibility to respond to changes in these NMEs.
437
261. The United States maintains that the Panel erre d in its application of Article I:1 of the
GATT 1994 in finding that Article 9(5) of the Basi c AD Regulation is inconsistent with that
provision. In the United States' view, Chinese products pose "methodological challenges to
investigating authorities" in determining costs and prices in connection with those products due to
pervasive State interference.
438 Thus, Article 9(5) of the Basic AD Regulation is designed to address
a particular condition associated with the nature of China's economy. Moreover, several WTO rules,
including the second Ad Note to Article VI:1 of the GATT 1994 and China's Accession Protocol,
explicitly recognize that, in the context of anti-dumping and countervailing duty proceedings,
products from one Member may be treated diff erently from those of another Member. The
United States further contends that the Panel misinterpreted Article 9 of the Anti-Dumping Agreement
when finding that Article 9(5) of the Basic AD Regul ation is inconsistent with Article 9.2 of the
Anti-Dumping Agreement because Article 9.2 requires an authority to "name the supplier or suppliers
of the product concerned" when imposing a duty. According to the United States, the imposition of
anti-dumping duties is always with respect to products, not individual exporters or producers. 439
Thus, the concept of imposing duties on exporters or producers, on which the Panel relied in reaching
its finding, has no basis in the Anti-Dumping Agreement . Moreover, the obligation to "name the
supplier" under Article 9.2 does not require an aut hority to calculate individual margins of dumping
for each exporter or producer.
262. The United States submits that, although it does not take a position on the particular facts at
issue in this dispute, it agrees with China that a definition of the domestic industry that is narrowly
limited to those parties who actively support or otherw ise wish to participate in the investigation does
not permit an "objective examination" of whethe r the domestic industry is experiencing material
injury, within the meaning of Article 3.1 of the Anti-Dumping Agreement.440 This is because those
producers most likely to participate are those who supported the complaint who had the "least healthy
economic performance". The United States also agr ees with China that the Panel's analysis under

437United States' third participant's submission, para. 21.
438United States' third participant's submission, para. 23.
439United States' third participant's submission, para. 26.
440United States' third participant's submission, para. 41.

Article 3.1 was flawed insofar as it did not account for the European Union's failure to make active
efforts to collect data on all known EU fastener produ cers. In this respect, the United States disagrees
with the Panel's suggestion that the European Union's exclusion of most known EU fastener producers
from its definition of the domestic industry may be justified by the fragmented nature of this industry.
263. The United States disagrees with the Panel's fi nding that the European Union is allowed to
use a process that favours complainants and suppor ters to be included in the domestic industry
definition "so long as the producer s that are included account for a sufficient quantity of domestic
production to be considered a 'major proportion'".
441 In the United States' view, such an interpretation
renders meaningless the two exceptions covered unde r subparagraphs (i) and (ii), which expressly
allow investigating authorities to depart from the incl usive standard defined in Article 4.1. Finally,
the United States disagrees with the European Un ion's argument that the "major proportion"
referenced by Article 4.1 should be interpreted to mean producers accounting for at least 25 per cent
of total domestic production in the light of the 25 per cent benchmark under Article 5.4 of the
Anti-Dumping Agreement for determining the sufficiency of standing. In the United States' view, the
25 per cent standing requirement under Article 5.4 sh ould not be read as setting a benchmark for the
"major proportion" requirement under Article 4.1 fo r defining the relevant domestic industry, given
that the 25 per cent standing requirement itself mu st be judged against a broader domestic industry
defined under Article 4.1 as "domestic producers as a whole" or "those of them whose collective
output … constitutes a major proportion of the total domestic production". 442
264. The United States submits that the Panel co rrectly interpreted Article 6.1.1 of the
Anti-Dumping Agreement in finding that the 30 -day response period prescribed in that provision
applies only to the original anti-dumping questio nnaire. The United States recalls that, in Egypt –
Steel Rebar , the panel explained that the term "questionna ire" refers to one particular request for
information made by the investigating authority. 443 Moreover, the panel in US – Anti-Dumping and
Countervailing Duties (China) similarly found that the term "questionnaires" in Article 12.1.1 of the
SCM Agreement refers to the initial comprehensive questionna ire issued by an investigating authority
covering the issues on which the investigating authority will have to make dete rminations in relation
to subsidization of the investigated product, injury, and causation. 444 The United States further
submits that paragraphs 6 and 7 of Annex I to the Anti-Dumping Agreement refer to "the
questionnaire" in the singular. In the United States' view, given the breadth of information requested

442 United States' third participant's submission, para. 47.
443United States' third participant's submission, para. 32 (referring to Panel Report, Egypt – Steel Rebar,
para. 7.7276).
444United States' third participant's submission, para. 33 (referring to Panel Report, US – Anti-Dumping

in the initial anti-dumping questionnaire, it is logical that the Anti-Dumping Agreement seeks to
provide a minimum time period for respondent firms to collect the necessary data. However, the
opportunity to claim MET or IT is merely a precursor to the issuance of the actual anti-dumping
questionnaire, and hence not subject to th e obligations in Article 6.1.1 of the Anti-Dumping
Agreement.445
III. Issues Raised in This Appeal
265. The following issues are raised in the appeal by the European Union:
(a) whether the Panel erred in finding that Artic le 9(5) of the Basic AD Regulation is
inconsistent "as such" with Articles 6.10 and 9.2 of the Anti-Dumping Agreement and
with Article I:1 of the GATT 1994, and in particular:
(i) whether the Panel erred in finding that Article 9(5) of the Basic
AD Regulation concerns not only the imposition of anti-dumping duties, but
also the calculation of margins of dumping;
(ii) whether the Panel erred in its inte rpretation of Article 6.10 of the
Anti-Dumping Agreement and in finding that Article 9(5) of the Basic
AD Regulation is inconsistent with Article 6.10 of the Anti-Dumping
Agreement, because it conditions the determination of individual dumping
margins for exporters or producers from NMEs on the fulfilment of the
IT test;
(iii) whether the Panel erred in its inte rpretation of Article 9.2 of the
Anti-Dumping Agreement and in finding that Article 9(5) of the Basic
AD Regulation is inconsistent with Article 9.2 of the Anti-Dumping
Agreement, because it conditions the imposition of individual duties on
exporters or producers from NMEs on the fulfilment of the IT test;
(iv) whether the Panel erred in finding that Article 9(5) of the Basic
AD Regulation violates the MFN obligation in Article I:1 of the GATT 1994;
and
(v) whether, in making the findings that Article 9(5) of the Basic AD Regulation
is inconsistent "as such" with Articles 6.10 and 9.2 of the Anti-Dumping

445United States' third participant's submission, para. 35.

Agreement and with Article I:1 of the GATT 1994, the Panel acted
inconsistently with its obligations under Article 11 of the DSU;
(b) whether the Panel erred in finding that the European Union acted inconsistently with
Article XVI:4 of the WTO Agreement and Article 18.4 of the Anti-Dumping
Agreement by failing to ensure the conformity of its laws, regulations, and
administrative procedures with its obligations under the relevant agreements;
(c) whether the Panel erred in finding that Artic le 9(5) of the Basic AD Regulation is
inconsistent with Articles 6.10 and 9.2 of the Anti-Dumping Agreement "as applied"
in the fasteners investigation;
(d) whether the Panel erred in the interpretati on and application of Article 6.4 of the
Anti-Dumping Agreement , and acted inconsistently with Article 11 of the DSU, in
finding that the European Union acted in consistently with Article 6.4 of the
Anti-Dumping Agreement by failing to provide a timely opportunity for the Chinese
exporters to see the product types used by the Commission for purposes of comparing
the export price and the normal value in the dumping determination;
(e) whether the Panel erred in finding that, by failing to provide a timely opportunity for
the Chinese exporters to see the product t ypes, the European Union also acted
inconsistently with Article 6.2 of the Anti-Dumping Agreement by failing to ensure all
interested parties had a full opportunity for the defence of their interests;
(f) whether the Panel erred in its interpretati on and application of Articles 6.5 and 6.5.1
of the Anti-Dumping Agreement with regard to the European Union's treatment of
confidential information, and in particular:
(i) whether the Panel erred in finding that the European Union failed to ensure
that the two domestic producers, Agrati and Fontana Luigi, provided
appropriate statements of the re asons why information provided in
confidence was not susceptible of summary;
(ii) whether the claim that the European Union failed to establish that
"good cause" existed to support the c onfidential treatment of information
submitted by the analogue country producer participating in the investigation,
Pooja Forge, was within the Panel's te rms of reference under Article 6.2 of
the DSU; and if so

(iii) whether Panel erred in finding that the European Union failed to establish
that "good cause" existed to support the confidential treatment of information
submitted by Pooja Forge;
(iv) whether, in addressing China's claim that no "good cause" supported the
confidential treatment of information submitted by Pooja Forge, the Panel
acted inconsistently with its obliga tions under Article 11 of the DSU, and
deprived the European Union of its right to due process; and
(g) whether the Panel erred in finding that China's claims before the Panel under
Articles 6.2 and 6.4 of the Anti-Dumping Agreement regarding the disclosure of the
identity of the complainants and the supporters of the complaint were within the
Panel's terms of reference under Article 6.2 of the DSU.
266. The following issues are raised in the other appeal by China:
(a) whether the Panel erred in rejecting China' s claim that the domestic industry in the
fasteners investigation did not include pr oducers whose collective output "constitutes
a major proportion of the total domestic production" within the meaning of
Article 4.1 of the Anti-Dumping Agreement, and in particular:
(i) whether the Commission erroneously relied on a presumption that 25 per cent
of the total domestic production cons tituted "a major proportion", and
therefore failed to define the domestic industry in the fasteners investigation
consistently with Article 4.1; and
(ii) whether other specific circumstances of the fasteners investigation were
relevant to the examination of the domestic industry definition in the
fasteners investigation under Article 4.1 of the Anti-Dumping Agreement;
(b) whether the Panel erred in rejecting Chin a's claim that the European Union acted
inconsistently with Article 3.1 of the Anti-Dumping Agreement by making an injury
determination on the basis of a sample of producers that was not representative of the
domestic industry;
(c) whether the Panel erred in finding that the European Union did not act inconsistently
with Articles 4.1 and 3.1 of the Anti-Dumping Agreement by excluding certain
producers from the definition of the domestic industry, and in particular:

(i) whether the Panel acted inconsistently with its obligations under Article 11 of
the DSU and Article 17.6 of the Anti-Dumping Agreement in finding that the
European Union did not exclude from the definition of the domestic industry
those producers who did not support the complaint;
(ii) whether the Panel erred in the interpreta tion and application of Article 4.1 of
the Anti-Dumping Agreement, and acted inconsistently with Article 11 of the
DSU, in finding that the European Union did not act inconsistently with
Article 4.1 of the Anti-Dumping Agreement by excluding from the definition
of the domestic industry producers who did not make themselves known
within 15 days of the publication of the Notice of Initiation; and
(iii) whether the Panel erred in the interpreta tion and application of Article 3.1 of
the Anti-Dumping Agreement in rejecting China's claim that the
European Union acted inconsistently with that provision by excluding certain
producers;
(d) whether the Panel erred in finding that the Commission did not act inconsistently with
Article 2.4 of the Anti-Dumping Agreement in the dumping determination in the
fasteners investigation, and in particular:
(i) whether the Panel acted inconsistently with Article 11 of the DSU, and erred
in its interpretation and application of Article 2.4 of the Anti-Dumping
Agreement, in not addressing China's argument that the Commission failed to
inform the interested parties of the "product types" it used to compare the
export price and normal value;
(ii) whether the Panel erred in the inte rpretation of Article 2.4 of the
Anti-Dumping Agreement , and acted inconsistently with Article 11 of the
DSU, when finding that the Commission did not have to make adjustments
for the physical differences reflected in the Product Control Number (the
"PCN"); and
(iii) whether the Panel erred in the interpreta tion and application of Article 2.4 of
the Anti-Dumping Agreement in finding that the European Union did not have
to make adjustments for alleged quality differences;

(e) whether the Panel erred in its interpretati on and application of Articles 6.5 and 6.5.1
of the Anti-Dumping Agreement with regard to the European Union's treatment of
confidential information, and in particular:
(i) whether the Panel erred in finding that the European Union did not act
inconsistently with its obligations under Article 6.5 when the Commission
granted the request to treat the identity of the complainants and the supporters
of the complaint as confidential; and
(ii) whether the Panel acted inconsistently with Article 11 of the DSU in its
evaluation of the above claim when it impermissibly shifted the burden to
China to show that the "good cause" alle ged for the confidential treatment of
the complainants' identity was unfounded;
(f) if the Appellate Body finds that the Panel erred in finding that "good cause" existed to
support the confidential treatment of the id entity of the complainants and supporters
of the complaint, whether the European Un ion also violated Articles 6.2 and 6.4 of
the Anti-Dumping Agreement when it failed to disclose the identity of the
complainants and the supporters of the complaint to the Chinese producers;
(g) whether the Panel erred in its interpretati on and application of Article 6.1.1 of the
Anti-Dumping Agreement , and in particular of the term "questionnaire", when it
found that the European Union did not act inconsistently with this provision by
allowing Chinese exporters less than 30 days to submit the Market Economy
Treatment and/or Individual Treatment Claim Form; and
(h) whether the Panel acted inconsistently with Article 11 of the DSU and Article 17.6 of
the Anti-Dumping Agreement when it concluded that the Market Economy Treatment
and/or Individual Treatment Claim Form did not fall under the definition of
"questionnaires" as interpreted by the Panel.

IV. The Panel's Findings Regarding Article 9(5) of the Basic AD Regulation "As Such"
A. Introduction
267. Before the Panel, China claimed that Article 9(5) of Council Regulation (EC) No. 1225/2009
of 30 November 2009 (the "Basic AD Regulation")
446 is inconsistent "as such" with Articles 6.10, 9.2,
9.3, and 9.4 of the Anti-Dumping Agreement as well as Articles I:1 and X:3(a) of the GATT 1994.
China also claimed that, as a consequence of the fact that Article 9(5) of the Basic AD Regulation is
inconsistent with the provisions of the Anti-Dumping Agreement and of the GATT 1994, this measure
is also inconsistent with Article XVI:4 of the WTO Agreement and Article 18.4 of the Anti-Dumping
Agreement.
268. The Panel found that Article 9(5) of the Basic AD Regulation is inconsistent with
Articles 6.10 and 9.2 of the Anti-Dumping Agreement because it requires that a country-wide dumping
margin be determined and a country-wide duty be imposed with respect to producers or exporters
from non-market economies ("NMEs") unless such producers or exporters show, on the basis of the
criteria set out in that provision, that they are independent of their State.
447 The Panel also found that
Article 9(5) of the Basic AD Regulation violates the most favoured nation ("MFN") obligation of
Article I:1 of the GATT 1994 because its application will, in certain situations, result in imports of the
same product from different WTO Members being treat ed differently in anti-dumping investigations
conducted by the European Union.448
269. As a consequence of its findings that Article 9( 5) of the Basic AD Regulation is inconsistent
with Articles 6.10 and 9.2 of the Anti-Dumping Agreement , the Panel also found that the
European Union acted inconsisten tly with Article XVI:4 of the WTO Agreement and Article 18.4 of
the Anti-Dumping Agreement by failing to ensure the conformity of its laws, regulations, and
administrative procedures with its obligations under the relevant agreements.449
270. The European Union appeals these findings and requests the Appellate Body to: (i) reverse
the Panel's finding that Article 9(5) of the Basi c AD Regulation concerns not only the imposition of
anti-dumping duties, but also the calculation of margins of dumping, and find instead that Article 9(5)

446Official Journal of the European Union , L Series, No. 343 (22 December 2009) 51, and
Corrigendum, Official Journal of the European Union , L Series, No. 7 (12 January 2010) 23 (Panel Exhibit
CHN-3).
447Panel Report, paras. 7.98 and 7.112.
448Panel Report, para. 7.124.
449Panel Report, para. 7.137. Having found that Article 9(5) is inconsistent "as such" with Articles 6.10
and 9.2 of the Anti-Dumping Agreement and with Article I:1 of the GATT 1994, the Panel exercised judicial
economy in respect of China's claims under Articles 9.3 and 9.4 of the Anti-Dumping Agreement and
Article X:3(a) of the GATT 1994. (Ibid., paras. 7.116, 7.118, and 7.133)

of the Basic AD Regulation, on its face, deals with only the individual or co untry-wide imposition of
anti-dumping duties in respect of imports from NM Es; (ii) reverse the Panel's finding that
Article 9(5) of the Basic AD Regulation is inconsistent with Article 6.10 of the Anti-Dumping
Agreement, since that finding was premised on the Panel's incorrect understanding of the scope of
Article 9(5) of the Basic AD Regulation; (iii) rever se the Panel's finding that Article 9(5) of the Basic
AD Regulation is inconsistent with Article 6.10 of the Anti-Dumping Agreement because it conditions
the determination of individual dumping margins for producers or exporters from NMEs on the
fulfilment of the individual treatment ("IT") test; (iv) reverse the Panel's finding that Article 9(5) of
the Basic AD Regulation is incons istent with Article 9.2 of the Anti-Dumping Agreement because it
conditions the imposition of individual duties on producers or exporters from NMEs on the fulfilment
of the IT test; (v) reverse the Pa nel's finding that Article 9(5) of the Basic AD Regulation violates the
MFN obligation under Article I:1 of the GATT 1994; and (vi) reverse the Panel's consequential
findings that the European Union acted in consistently with Article XVI:4 of the WTO Agreement and
Article 18.4 of the Anti-Dumping Agreement by failing to ensure the conformity of its laws,
regulations, and administrative procedures with its obligations under the relevant agreements.
271. Before turning to the specific issues on appeal, we consider it useful to outline the measure at
issue in this dispute, that is, the Basic AD Regulation and, in particular, Article 9(5).
B. The Measure at Issue
272. Article 9(5) of the Basic AD Regulation pr ovides that "[a]n anti-dumping duty shall be
imposed in the appropriate amounts in each case, on a non-discriminatory basis on imports of a
product from all sources found to be dumped and causing injury, except for imports from those
sources from which undertakings under the terms of th is Regulation have been accepted." It further
establishes that the regulation imposing the anti-dumping duty shall specify the duty "for each
supplier or, if that is impracticable, and in general where Article 2(7)(a) applies, the supplying country
concerned". Article 2(7)(a) provides that, in th e case of imports from NMEs, normal value shall not
be determined based on prices paid or payable in the ordinary course of trade by independent
customers in the exporting country, but based on an alternative methodology, such as the price or
constructed value in a market economy third country.
273. To provide the relevant context for Article 9(5), we note that Article 2 of the Basic AD
Regulation addresses the determination of dumping, including the determination of normal value.
The rules set out in Article 2(1) to (6) closely mirror the provisions of Article 2.2 of the Anti-Dumping
Agreement, and concern the determination of normal value in respect of imports from market
economies. Article 2(7) of the Basic AD Regulati on contains specific rules on the determination of

normal value in anti-dumping investigations involvi ng NMEs. It groups NMEs into two categories—
(i) NMEs that are not WTO Members and (ii) NMEs that are WTO Members (and Kazakhstan)—and
establishes different rules for determining normal value for these categories.
274. Article 2(7)(a) applies to NMEs that are not Members of the WTO, including Albania,
Armenia, Azerbaijan, Belarus, Georgia, North Korea, Kyrgyzstan, Moldova, Mongolia, Tajikistan,
Turkmenistan, and Uzbekistan.
450 It provides that, for these countries, normal value is determined on
the basis of the price or constructed value in a market economy third country, or the price from such a
third country to other countries, including the Europ ean Union, or, where this is not possible, on any
other reasonable basis, including the price actually pa id or payable in the European Union for the like
product duly adjusted if necessary to include a reas onable profit margin. Article 2(7)(b), which
applies to "imports from the People's Republic of China, Vietnam and Kazakhstan and any [NME]
country which is a member of the WTO at th e date of the initiation of the investigation" 451 provides
that if it is shown, on the basis of properly subs tantiated claims by one or more producers subject to
the investigation and in accordance with the criteria and procedures set out in Article 2(7)(c), that
"market economy conditions prevail" for them, norma l value is determined for those producers in
accordance with the rules in Article 2(1) to (6) applicable to market economies. Article 2(7)(b)
further provides that, when this is not the case, normal value will be determined on the basis of
Article 2(7)(a), that is, on the basis of the pr ice or constructed value in a market economy third
country, or the price actually paid or payabl e in the European Union for the like product.
Article 2(7)(c) sets out the criteria that a foreign prod ucer has to fulfil in order to demonstrate that it
operates under market economy conditions, and th us that "market economy conditions prevail".
These criteria are generally referred to as the market economy treatment test ("MET test"). 452 T h e

450See corrigendum to Basic AD Regulation, supra, footnote 5.
451See corrigendum to Basic AD Regulation, supra, footnote 5.
452Specifically, Article 2(7)(c) sets out the following criteria for the MET test. To demonstrate that
they operate under market economy conditions, producers must show that:
 decisions of firms regarding prices, costs and inputs, including for
instance raw materials, cost of technology and labour, output, sales and
investment, are made in response to market signals reflecting supply
and demand, and without significant State interference in this regard,
and costs of major inputs substantially reflect market values;
 firms have one clear set of ba sic accounting records which are
independently audited in line with international accounting standards
and are applied for all purposes;
 the production costs and financial situation of firms are not subject to
significant distortions carried over from the former non-market
economy system, in particular in relation to depreciation of assets, other
write-offs, barter trade and payment via compensation of debts;
 the firms concerned are subject to bankruptcy and property laws which
guarantee legal certainty and stability for the operation of firms; and
 exchange rate conversions are carried out at the market rate.

determination of export prices to which the normal valu e is compared in order to calculate the margin
of dumping is dealt with in Article 2(8) and (9). Article 2(8) provides that the export price shall be
the price actually paid or payable for the product when sold for export from the exporting country to
the European Union. Article 2(9) sets out alterna tive methods for the determination of export prices
under certain specified circumstances that are not relevant in this dispute.
275. Article 9(5) of the Basic AD Regulation sets out the modalities for the imposition of anti-
dumping duties. Article 9(5) requires that, in principle, a duty be specified for each "supplier" of a
product found to be dumped. It then provides for tw o exceptions to this principle: (i) where it is
"impracticable" to specify the duty for each supplier; and (ii) where Article 2(7)(a) of the Basic AD
Regulation applies—that is, where normal value fo r NME suppliers is determined on the basis of
market economy third country prices or one of the othe r methods set forth in that provision. In these
situations, the regulation imposing the duty shall sp ecify a single duty rate for the supplying country
concerned, a so-called country-wide duty, which w ill apply to all suppliers and imports from that
country.
276. Article 9(5), however, exempts from the country-wide duty rate those NME suppliers that
qualify for individual treatment ("IT suppliers"). An exporter from an NME may qualify for
individual treatment and be granted an individual duty if it meets all of the following conditions:
(a) in the case of wholly or partly foreign owned firms or joint
ventures, exporters are free to repatriate capital and profits;
(b) export prices and quantities, and conditions and terms of sale are
freely determined;
(c) the majority of the shares belong to private persons; state
officials appearing on the board of directors or holding key
management positions shall either be in minority or it must be
demonstrated that the comp any is nonetheless sufficiently
independent from State interference;
(d) exchange rate conversions are ca rried out at the market rate; and
(e) State interference is not such as to permit circumvention of
measures if individual exporters are given different rates of duty.
277. These criteria are generally referred to as the "IT test". If an exporter demonstrates that it
meets these conditions and is thus entitled to indivi dual treatment, the EU authorities will specify an
individual duty rate for that exporter. Such an i ndividual rate is determined by comparing the normal
value from the market economy third country with th e exporters' actual export prices. Exporters that
fail to satisfy the IT test will be subject to the country-wide duty rate.

278. Thus, when an exporter from a WTO Member th at the European Union treats as an NME is
subject to an anti-dumping investigation, the follo wing possibilities with respect to the determination
of normal value and the imposition of an anti-dumpi ng duty apply. If the NME exporter or producer
satisfies the MET test according to the criteria set out in Article 2(7)(c), then, according to
Article 2(7)(b), its normal value will be determined on the same basis as for exporters from market
economies, that is, prices paid or payable, in the ordinary course of trade, by independent customers
in the exporting country. More over, according to Article 9(5), an individual duty rate will be
specified for that supplier.
279. If the NME exporter fails to meet the MET test , then its normal value will be determined on
the basis of an alternative method (u sually on the basis of prices in a market economy third country).
Whether an individual or a country-wide duty rate will be specified for that supplier will depend on
whether the exporter requests and obtains individual tr eatment, pursuant to Article 9(5). Thus, if the
NME exporter that has not fulfilled the MET test ma kes such a request and demonstrates that it meets
the criteria in Article 9(5) of the Basic AD Regulat ion—that is, the IT test—an individual duty rate
will be specified for the NME exporter on the basis of a comparison of the alternative third country
normal value with its own export prices.
453
280. An NME exporter that does not meet the IT test will be subject to a country-wide duty rate.
The determination of the export price used to calcu late that country-wide duty rate will depend on the
level of cooperation on the part of the non-IT exporters altogether. If the level of cooperation is
high—that is, if the cooperating non-IT exporters account for almost 100 per cent of all exports—the
export price will be based on a weighted average of the actual price of all export transactions effected
by these exporters. If, however, the level of coope ration is low—that is, if the cooperating non-IT
exporters account for significantly less than 100 pe r cent of all exports—the Commission will resort
to facts available to complete the missing informa tion. Recourse to facts available will depend on the
degree of non-cooperation and may include statistical import data.
454
281. In sum, Article 2(7) of the Basic AD Regula tion determines whether a supplier from an NME
will receive market economy treatment, that is, wh ether the normal value for its imports will be
determined on the basis of its domestic prices or co sts or on the basis of an alternative methodology.
Article 9(5) of the Basic AD Regulation determin es whether a supplier from an NME will receive an
individual or a country-wide anti-dumping duty. Acco rding to Article 9(5), NME suppliers that have

453For an NME exporter or producer who meets the ME T test, an individual duty will be specified on
the basis of a comparison between that exporter's domestic normal value and its export price; by contrast, for an
NME exporter or producer who meets the IT test, an individual duty will be calculated on the basis of a
comparison between that exporter's export price and a market economy third country normal value.
454Panel Report, para. 7.50.

fulfilled the MET test under Article 2(7) will automa tically receive individual duties; NME suppliers
that have not fulfilled the MET test under Article 2(7) will receive country-wide duties, but will
receive individual duties if they fulfil the IT test set out in Article 9(5).
282. In this dispute, China does not challenge th e European Union's alternative methodology to
determine normal value for imports from NMEs on the basis of a market economy third country, nor
does it challenge the criteria to grant market econo my treatment to WTO NME suppliers set forth in
Article 2(7). China directs its challenge to the rules regarding the specification of individual and
country-wide duties for NME suppliers, including the IT test, which are contained in Article 9(5) of
the Basic AD Regulation.
C. Section 15 of China's Accession Protocol
283. Before addressing the appeal by the Europ ean Union of the Panel's findings under
Articles 6.10 and 9.2 of the Anti-Dumping Agreement, we address the claim by the European Union
that the Protocol on the Accession of the People's Republic of China (China's "Accession
Protocol")
455, and in particular Section 15, allows the European Union to treat China as an NME for
the purpose of applying anti-dumping rules and, in particular, Article 9(5) of the Basic AD
Regulation.
284. The European Union argues that China's Acce ssion Protocol contains an understanding that
China is not yet a market economy and that, while it does not speak directly to the issue of whether
Chinese suppliers must receive individual treatment with respect to the calculation of dumping
margins and the imposition of anti-dumping duties, it "does not narrow the universe of situations
where the Anti-Dumping Agreement permits a flexible application of the rules".
456 T h e
European Union highlights that th e reference in paragraph 15(a)(i) and (ii) of China's Accession
Protocol to "the manufacture, production and sale of that product" suggests that the term "market
economy conditions" also "encompasses the situa tion where State intervention in the economy
including international trade is so substantial that operators cannot act independently from the State in
their export activities". 457 China responds that Section 15 of its Accession Protocol does not contain
"an official recognition by China" that it is an NME, but only "a temporary and limited derogation
from the rules in the [ Anti-Dumping Agreement ]" on the determination of the normal value in anti-
dumping investigations initiated with respect to imports from China.458

455WT/L/432, 23 November 2001.
456European Union's appellant's submission, para. 49.
457European Union's appellant's submission, para. 46.

285. We begin by observing that Section 15 of China's Accession Protocol contains a similar
acknowledgment of the difficulties in determining price comparability as the one contained in the
second Ad Note to Article VI:1 of the GATT 1994, in respect of imports from China.
459 The second
Ad Note to Article VI:1 recognizes that, in the cases of imports from countries where the State has a
complete or substantially complete monopoly of tr ade and where all domestic prices are fixed by the
State, importing Members may determine that a comparison with domestic prices in such a country
may not be appropriate due to special difficulties in determining price comparability. This provision
allows investigating authorities to disregard dom estic prices and costs of such an NME in the
determination of normal value and to resort to prices and costs in a market economy third country.
Article 2.7 of the Anti-Dumping Agreement states that Article 2 is without prejudice to the second

459Section 15 of China's Accession Protocol, entitled "Price Comparab ility in Determining Subsidies
and Dumping", reads in relevant part:
Article VI of the GATT 1994, the Agreement on Implementation of
Article VI of the General Agreement on Tariffs and Trade 1994 ("Anti-
Dumping Agreement") and the SCM Agre ement shall apply in proceedings
involving imports of Chinese origin into a WTO Member consistent with
the following:
(a) In determining price comparability under Article VI of the GATT 1994
and the Anti-Dumping Agreement, the importing WTO Member shall
use either Chinese prices or costs for the industry under investigation
or a methodology that is not based on a strict comparison with
domestic prices or costs in China based on the following rules:
(i) If the producers under investiga tion can clearly show that market
economy conditions prevail in the industry producing the like
product with regard to the manufacture, production and sale of
that product, the importing WT O Member shall use Chinese
prices or costs for the industry under investigation in determining
price comparability;
(ii) The importing WTO Member may use a methodology that is not
based on a strict comparison with domestic prices or costs in
China if the producers under inve stigation cannot clearly show
that market economy conditions prevail in the industry producing
the like product with regard to manufacture, production and sale
of that product.
 …
(d) Once China has established, under the national law of the importing
WTO Member, that it is a market economy, the provisions of
subparagraph (a) shall be terminated provided that the importing
Member's national law contains market economy criteria as of the date
of accession. In any event, the prov isions of subparagraph (a)(ii) shall
expire 15 years after the date of accession. In additio n, should China
establish, pursuant to the national law of the importing WTO Member,
that market economy conditions prevail in a particular industry or
sector, the non-market economy provisions of subparagraph (a) shall
no longer apply to that industry or sector.

Ad Note to Article VI:1 of the GATT 1994, and thus incorporates the second Ad Note to Article VI:1
into the Anti-Dumping Agreement.460
286. According to paragraph 15(a) of China's Accession Protocol, it is incumbent upon Chinese
producers to "clearly show" that market economy co nditions prevail in the industry producing the like
product in order for Chinese prices or costs to be used when determining price comparability. If
Chinese producers are not able to "clearly show " that market economy conditions prevail in the
industry in question, the importing WTO Member may use an alternative methodology that is not
based on a strict comparison with domestic prices or costs in China, such as using surrogate third
country or constructed normal value.
287. We note that paragraph 15(a) of China's Acce ssion Protocol places the burden on the Chinese
producers clearly to show that market economy cond itions prevail in the industry producing the like
product with respect to its manufacture, production, and sale. If such a showing is made, the
importing Member shall use Chinese prices and costs in determining price comparability. Like the
second Ad Note to Article VI:1 of the GATT 1994, pa ragraph 15(a) of China's Accession Protocol
permits importing Members to derogate from a strict comparison with domestic prices or costs in
China, that is, in respect of the determination of th e normal value. This is indicated by the text of
paragraph 15(a), which, in respect of the dete rmination of price comparability, refers to " Chinese

460The second Ad Note to Article VI:1 of the GATT 1994 reads as follows:
It is recognized that, in the case of imports from a country which has a
complete or substantially complete monopoly of its trade and where all
domestic prices are fixed by the State, special difficulties may exist in
determining price comparability for the purposes of paragraph 1, and in such
cases importing Members may find it necessary to take into account the
possibility that a strict comparison with domestic prices in such a country
may not always be appropriate.
 We observe that the second Ad Note to Article VI:1 refers to a "country which has a complete or
substantially complete monopoly of its trade" and "where all domestic prices are fixed by the State". This
appears to describe a certain type of NME, where the St ate monopolizes trade and sets all domestic prices. The
second Ad Note to Article VI:1 would thus not on its face be applicable to lesser forms of NMEs that do not
fulfil both conditions, that is, the complete or substantia lly complete monopoly of trade and the fixing of all
prices by the State.
 Furthermore, the reference in the second Ad Note to Article VI:1 to a strict "comparison with domestic
prices" not always being "appropriate" provides flexibility only in respect of the determination of normal value.
The recognition of special difficulties in determining price comparability in the second Ad Note to Article VI:1
does not mean that importing Members may depart from the provisions regarding the determination of export
prices and the calculation of dumping margins and anti-dumping duties set forth in the Anti-Dumping Agreement
and in the GATT 1994. While the second Ad Note to Article VI:1 refers to difficulties in determining price
comparability in general, the text of this provision clarifies that these difficulties relate exclusively to the normal
value side of the comparison. This is indicated by the operative part in the third sentence of this provision,
which only allows importing Members to depart from a "strict comparison with domestic prices".
The second Ad Note to Article VI:1 was added to the GATT 1947 following the 1954-1955 Review
Session. (L/334, adopted 3 March 1955, p. 2, para. 6, and Annex I, Section I.B, p. 10; BISD 3S/222, at 223,
para. 6)

prices or costs" or "a methodology that is not based on a strict comparison with domestic prices or
costs in China".
461
288. We do not consider that the references in para graph 15(a)(i) and (ii) to producers having to
show that "market economy conditions prevail … with regard to the manufacture, production and
sale"462 of a product means that paragraph 15(a) permits any derogations also with respect to the
determination of export prices. We reach this conclusion because, when producers are not able to
show that market economy conditions pr evail (including with regard to the sale of the product),
paragraph 15(a) makes it clear that all an impor ting WTO Member is allowed to do as a consequence
is to "use a methodology that is not based on a strict comparison with domestic prices or costs in
China".463
289. Paragraph 15(d) of China's Accession Prot ocol establishes that the provisions of
paragraph 15(a) expire 15 years after the date of China's accession (that is, 11 December 2016). It
also provides that other WTO Members shall gran t before that date the early termination of
paragraph 15(a) with respect to China's entire economy or specific sectors or industries if China
demonstrates under the law of the importing WTO Member "that it is a market economy" or that
"market economy conditions prevail in a particular industry or sector". Since paragraph 15(d)
provides for rules on the termination of paragraph 15(a ), its scope of application cannot be wider than
that of paragraph 15(a). Both paragraphs concern exclusively the determination of normal value. In
other words, paragraph 15(a) contains special ru les for the determination of normal value in anti-
dumping investigations involving Ch ina. Paragraph 15(d) in turn establishes that these special rules
will expire in 2016 and sets out cer tain conditions that may lead to the early termination of these
special rules before 2016.
290. In our view, therefore, Section 15 of China's Accession Protocol does not authorize WTO
Members to treat China differently from other Members except for the determination of price
comparability in respect of domestic prices and costs in China, which relates to the determination of
normal value. We consider that, while Section 15 of China's Accession Protocol establishes special
rules regarding the domestic price aspect of pric e comparability, it does not contain an open-ended
exception that allows WTO Members to treat China differently for other purposes under the

461Emphasis added.
462Emphasis added.
463Emphasis added.

Anti-Dumping Agreement and the GATT 1994, such as the determination of export prices or
individual versus country-wide margins and duties.464
291. Finally, we note that China's claim before the Panel concerned the determination of individual
and country-wide dumping margins and duties, not the possibility of resorting to alternative
methodologies in the calculation of normal value in anti-dumping investigations involving China.
D. The Scope of Article 9(5) of the Basic AD Regulation
292. We now turn to the European Union's appeal of the Panel's findings concerning the scope of
Article 9(5) of the Basic AD Regulation. The Panel found that "Article 9(5) of the Basic AD
Regulation concerns not only the imposition of anti-dumping duties but also the calculation of
margins of dumping".
465 The Panel reasoned that, as a general matter, "there is a close and necessary
link between the calculation of a margin of du mping and the imposition of an anti-dumping duty" 466
and that "normally, an investigating authority woul d calculate the margin of dumping and impose the
consequent anti-dumping duty on the same basis", whether this is producer specific or country-
wide.467 Specifically, the Panel found that, "in operation, th e result of the IT test in Article 9(5) of the
Basic AD Regulation determines the nature of the margin calculation the EU authorities will
undertake, either individual or country-wide".468
293. The European Union claims that Article 9(5) of the Basic AD Regulation, examined on its
face and based on its text and in the context of othe r Articles of the Basic AD Regulation, shows that
it "deals exclusively with the imposition of anti-dumping duties" 469 and does not address the

464Paragraph 150 of China's Accession Working Party Report states that several WTO Members noted
that China was continuing the process of transition towards a full market economy and also refers to possible
special difficulties in determining price comparability and to the possibility that a strict comparison with
domestic costs and prices in China might not always be appropriate. It states:
Several members of the Working Party noted that China was continuing the
process of transition towards a full market economy. Those members noted
that under those circumstances, in the cas e of imports of Chinese origin into
a WTO Member, special difficulties could exist in determining cost and
price comparability in the context of anti-dumping investigations and
countervailing duty investigations. Those members stated that in such
cases, the importing WTO Member might find it necessary to take into
account the possibility that a strict comparison with domestic costs and
prices in China might not always be appropriate.
465Panel Report, para. 7.77.
466Panel Report, para. 7.72.
467Panel Report, para. 7.74.
468The Panel found that it is undisputed that, where according to Article 9(5) country-wide duties are
imposed on NME producers that fail the IT test, the European Commission calculates only a country-wide
dumping margin for such producers (and not individual margins), while in respect of producers that pass the IT
test, an individual margin is calculated and an individual duty is imposed. (Panel Report, para. 7.77)
469European Union's appellant's submission, para. 90.

calculation of dumping margins or whether such dumping margins should be calculated on an
individual or a country-wide basis. According to the European Union, the determination of the
dumping margin for a supplier entitled to an individual dumping margin flows from the rule contained
in Article 9(4) rather than 9(5) of the Basic AD Regulation, which China did not specify as the
measure at issue in the present dispute.
294. China contends that the Panel's finding on the "meaning" and "scope" of Article 9(5) of the
Basic AD Regulation is an issue of fact that the A ppellate Body is not competent to review pursuant
to Article 17.6 of the DSU. China submits that the meaning and scope of Article 9(5) is not clear "on
its face", and its determination involves the Panel's findings on relevant factual elements with which
the Appellate Body will not lightly interfere. Ch ina contends that, because the European Union has
failed to raise a claim under Article 11 of the DSU in this respect, the Panel's finding regarding the
meaning and scope of Article 9(5) of the Basic AD Regulation is not subject to our review in this
case. In the alternative, assuming that we were to consider ourselves competent to review this issue,
China submits that the Panel correctly found that Article 9(5) of the Basic AD Regulation concerns
not only the imposition of anti-dumping duties but also the calculation of dumping margins.
470
295. We begin by addressing China's preliminary obj ection that the Panel's finding concerning the
meaning and scope of Article 9(5) of the Basic AD Regul ation is a matter of fact that is not subject to
appellate review pursuant to Article 17.6 of th e DSU. We disagree with China and the Panel. 471 On
several occasions, the Appellate Body has clarified that municipal law may serve both as evidence of
facts and evidence of a Member's compliance or no n-compliance with its in ternational obligations.472
In particular, in US – Section 211 Appropriations Act , the Appellate Body stated that, when a panel
examines the municipal law of a WTO Member for the purpose of determining whether that Member
has complied with its WTO obligations, that examina tion is a legal characterization by a panel and is
therefore subject to appellate review under Article 17.6 of the DSU.473
296. In China – Auto Parts , the Appellate Body stated that it could review the panel's findings
regarding the meaning of municipal law to the ex tent that the panel conduc ted its examination of
municipal law for purposes of determining whet her the Member had complied with its WTO

471At the outset of its analysis of the scope of Article 9(5) of the Ba sic AD Regulation, the Panel stated
that it fell upon it "to clarify the scope/operation of Artic le 9(5) of the Basic AD Regulation as a factual matter
before engaging in a substantive analysis of China's claims". (Panel Report, para. 7.68)
472Appellate Body Report, India – Patents (US) , paras. 65 and 66; Appellate Body Report, US –
Hot-Rolled Steel , para. 200; Appellate Body Report, China – Publications and Audiovisual Products ,
paras. 177 and 178; Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review , para. 168;
Appellate Body Report, US – Carbon Steel, paras. 156 and 157.
473Appellate Body Report, US – Section 211 Appropriations Act, para. 105.

obligations. The Appellate Body recognized that there will be instances in which a panel's assessment
of municipal law will go beyond the text of the instrument on its face, in which case further
examination may be required, and may involve factua l elements. The Appellate Body explained that
it would not lightly interfere with a panel's assessme nt of municipal law that went beyond the text of
an instrument on its face and involved such factual elements. 474 The Appellate Body clarified that the
examination of a municipal legal instrument will focu s on its text, but may also include the context of
the provision and the "overall structure and logic"475 of the municipal law.476 In this dispute, the Panel
did not review factual elements concerning the application of Article 9(5), such as pronouncements by
EU domestic courts or opinions of legal experts or recognized scholars477, but assessed Article 9(5) of
the Basic AD Regulation, based on the text of the provision, its context, and its operation.478
297. Therefore, we conclude that the Panel's assessme nt of the meaning and scope of Article 9(5)
of the Basic AD Regulation, which is based on the text of the provision, its context within the
structure of the other relevant provisions of the Regulation, and its operation is not a "factual matter"
and is not excluded from appellate review. Rather, the Panel examined Article 9(5) for the purpose of
determining its consis tency with a number of provisions of the Anti-Dumping Agreement and the
GATT 1994, which, as a matter of lega l characterization, is subject to appellate review according to
Article 17.6 of the DSU.
298. Having clarified that the Panel's findings concer ning the meaning and scope of Article 9(5) of
the Basic AD Regulation are subject to appellate revi ew, we now turn to the European Union's appeal
that the Panel erred in finding that Article 9(5) of the Basic AD Regulation concerns not only the
imposition of anti-dumping duties but also the calculation of margins of dumping.
299. The European Union contends that, even if the determination of dumping and the imposition
of duties are closely related issues, this does not mean that "any consequence of the Article 9(5)
determination, such as the nature of the dumping margin calculation, was part of the measure at

474Appellate Body Reports, China – Auto Parts, para. 225.
475Appellate Body Reports, China – Auto Parts, para. 238.
476Appellate Body Reports, China – Auto Parts , paras. 225-245; Appellate Body Report, China –
477Appellate Body Report, US – Carbon Steel, para. 157.
478The Panel stated that:
… the meaning of national law of a WTO Member is a matter of fact for
panels to establish. We note that the European Union has not provided any
evidence of the meaning of Article 9( 5) of the Basic AD Regulation, such
as, for instance, an interpretation from the EU courts having relevant
jurisdiction. Thus, we consider that it falls upon us to clarify the
scope/operation of Article 9(5) of the Basic AD Regulation as a factual
matter before engaging in a substantive analysis of China's claims.
(Panel Report, para. 7.68 (emphasis added; footnotes omitted))

issue".
479 The European Union contends that provisions of the Basic AD Regulation other than
Article 9(5) speak directly or indirectly to the separate issue of the determination of dumping margins
and whether those determinations are individual or country-wide. In particular, the European Union
refers to: (i) Article 2(7), as the basis on which a supplier meeting the MET test would be assigned an
individual margin of dumping; (ii) Article 9(4), which establishes the ceiling for the amount of anti-
dumping duties by reference to the margin of dumpi ng to be established; (iii) Article 9(6), which
addresses the calculation of dumping margins and the imposition of anti-dumping duties in the
context of sampling; (iv) Article 11(4), which pr ovides for the calculation of individual margins of
dumping for new exporters in reviews; and (v) Ar ticle 11(8), which requires that the dumping margin
be established on an individual basis in refund pro ceedings. According to the European Union, these
provisions address the separate issue of the individual determination of dumping margins.
480
300. Like the Panel, we note that the text of Ar ticle 9(5) of the Basic AD Regulation does not
explicitly mention dumping margins. However, we observe that Article 9(5) requires that an anti-
dumping duty "be imposed in the appropriate amounts in each case" and that such duty be specified
for each supplier or in certain circumstances for the supplying country concerned. We agree with the
Panel that there is "a close and necessary link" be tween the calculation of a dumping margin and the
imposition of an anti-dumping duty.
481 In particular, we consider th at the determination of a dumping
margin is a prerequisite for the imposition of an anti-dumping duty and that, therefore, a duty cannot
be imposed unless a margin has been calculated, in part because the margin sets the ceiling on the
amount of anti-dumping duty that may be imposed. Moreover, the requirement in Article 9(5) that the
amount of the duty be "appropriate" also pres upposes that an individual duty be based on an
individual margin, and a country-wide duty be based on a country-wide margin. It thus follows that,
if individual duties are imposed, individual margin s are calculated; if country-wide duties are
imposed, country-wide margins are calculated.
482
301. We are not persuaded that any of the other provisions of the Basic AD Regulation cited by the
European Union addresses the question of whethe r individual or country-wide dumping margins
should be calculated. Article 2 of the B asic AD Regulation, like Article 2 of the Anti-Dumping
Agreement, is entitled "Determination of Dumping", and contains rules concerning the determination
of normal value and export price, the comparis on between normal value and export price, and
methodologies to determine the existence of marg ins of dumping. Article 2 of the Basic AD
Regulation, however, like Article 2 of the Anti-Dumping Agreement , does not contain a rule that

479European Union's appellant's submission, para. 108.
480European Union's appellant's submission, para. 96.
481Panel Report, para. 7.72.
482See Panel Report, para. 7.74.

requires that dumping margins be determined fo r each individual exporter or producer. More
specifically, Article 2(7) of the Basic AD Regulation does not establish that individual margins of
dumping will be calculated for NME suppliers if they fulfil the MET test. Article 2(7) only provides
that, in the case of imports from NMEs, the normal value shall be determined on the basis of an
alternative methodology and not based on domestic prices or costs, unless exporters from NMEs are
able to show that market economy conditions prevail by demonstrating that they fulfil the criteria of
the MET test. Article 2(7), however, is silent about the calculation of individual margins and duties.
It is Article 9(5) of the Basic AD Regulation that establishes that individual duties will be specified
for NME suppliers that have fulfilled the MET test; it also stipulates that, for NME suppliers that did
not fulfil the MET test, an individual duty will be specified only if they fulfil the IT test.
302. Furthermore, Article 9(4) of the Basic AD Regulation, which appears to implement
Article 9.3 of the Anti-Dumping Agreement , does not address the issue of the type of dumping
margins that should be calculated for NME supplie rs. Article 9(4) of the Basic AD Regulation
concerns another issue, that is, the ceiling amount of anti-dumping duties, which must not exceed the
dumping margin. This ceiling applies regardless of whether dumping margins have been calculated
for each individual supplier or for all suppliers from a given country. Indeed, Article 9(4) does not
mention at all individual margins or duties, as it is concerned with the maximum ceiling applicable to
duties, regardless of whether these duties are imposed on an individual or a country-wide basis.
303. We observe that Article 9(6) of the Basic AD Regulation, which appears to implement
Article 9.4 of the Anti-Dumping Agreement, addresses the specific situation of the dumping margins
and anti-dumping duties that are determined a nd imposed on non-sampled producers, where the
European Commission resorts to sampling. It requires that the anti-dumping duty applied to exporters
or producers not included in the sample, who ha ve made themselves known and provided sufficient
information within three weeks of initiation of th e investigation, should not exceed the weighted
average margin of dumping established for the parties in the sample. Article 9(6) thus provides that
the margin of sampled exporters be averaged; this determination of a weighted average is
consequential to the calculation of individual margin s for those sampled exporters, which Article 9(6)
does not regulate.
304. Article 11(4) of the Basic AD Regulation, whic h appears to implement Article 9.5 of the
Anti-Dumping Agreement , requires that a review be carried out for the purpose of determining
individual margins for new exporters. Article 11(4) does not exclude the application of Article 9(5) to
new exporters from NMEs. In other words, an e xporter from an NME that applies for a new exporter
review under Article 11(4) would neve rtheless have to fulfil the conditio ns of Article 9(5) if it wants

to obtain individual dumping margins and duties. Moreover, Article 11(4) does not speak to the
calculation of individual margins for exporters or producers who are not "new exporters or
producers". Finally, Article 11(8) of the Basic AD Regulation allows an impor ter to request refunds,
and requires that for this purpose the dumping marg in for the relevant exporter be established on an
individual basis.
305. All of these provisions of the Basic AD Regul ation presuppose the prior determination of
dumping margins under a different rule; moreover, none of these provisions addresses the specific
question of whether individual or country-wide ma rgins should be determined for exporters or
producers. We, therefore, agree with the Panel that none of these other provisions of the Basic AD
Regulation cited by the European Union implements the requirement contained in Article 6.10 of the
Anti-Dumping Agreement that, as a rule, individual margins of dumping have to be determined for
each exporter or producer.
483
306. By contrast, Article 9(5) of the Basic AD Regulation, which establishes the circumstances
under which anti-dumping duties must be specified on an individual or a country-wide basis, by
necessary implication, also requires that dumping marg ins be determined on such a basis. The fact
that other provisions of the Basic AD Regula tion cited by the European Union presuppose the
determination of a dumping margin supports the vi ew that it is Article 9(5) that regulates the
circumstances under which dumping margins should be determined on an individual basis. To
suggest that no provision in the Basic AD Regulati on implements the requirement of Article 6.10 of
the Anti-Dumping Agreement that, as a rule, individual dumping margins be determined for each
exporter or producer, would result in a lacuna that is not consistent with the structure and operation of
the Basic AD Regulation and with the other rules in the Regulation, which presuppose the existence
of such a rule.
307. We also consider that the calculation of c ountry-wide margins for non-IT suppliers cannot be
described as "any consequence"
484 or as merely a potential consequence of the Article 9(5)
determination, as it is directly and necessarily associated with the rule in Article 9(5) that requires the
specification of country-wide duties for non-IT suppliers . In other words, it seems to us that the
calculation of dumping margins and of the amount of duties are closely linked, in that the method
used to determine dumping margins is reflected in the imposition of duties. As a consequence,
individual duties presuppose individual margins and country-wide duties presuppose country-wide

483Panel Report, para. 7.75.
484European Union's appellant's submission, para. 108.

margins. Therefore, we do not consider that, as the European Union argues 485, by addressing the
country-wide dumping margin calculation that results from the operation of Article 9(5), the Panel
incorrectly expanded the scope of the measure at issue.
308. In the light of the above, we consider that the Pa nel did not err in finding that Article 9(5) of
the Basic AD Regulation not only concerns the imposition of anti-dumping duties but also the
calculation of dumping margins, and that it could be challenged "as such" under Article 6.10 of the
Anti-Dumping Agreement, which addresses the calculation of margins of dumping for each exporter
or producer.
486
E. Articles 6.10 and 9.2 of the Anti-Dumping Agreement
309. Having concluded that Article 9(5) of th e Basic AD Regulation regulates not only the
imposition and collection of anti-dumping duties but also the determination of dumping margins, and
whether these are determined on an individual or a country-wide basis, we now turn to the Panel's
interpretation and application of Articles 6.10 and 9.2 of the Anti-Dumping Agreement.
310. The Panel ultimately found that Article 9(5) of the Basic AD Regulation is inconsistent with
Articles 6.10 and 9.2 of the Anti-Dumping Agreement because it requires th e determination of
country-wide dumping margins for and the imposition of country-wide anti-dumping duties on
exporters or producers from NMEs, unless such produ cers or exporters show, on the basis of the
criteria set out in that provision, that th ey are independent from the State (IT test).
487 We address
below first the Panel's interpretation of Articles 6.10 and 9.2 and then its application of these
provisions.
1. Interpretation of Articles 6.10 and 9.2 of the Anti-Dumping Agreement
(a) Article 6.10 of the Anti-Dumping Agreement
311. In its analysis of the consistency of Article 9( 5) of the Basic AD Regulation with Article 6.10
of the Anti-Dumping Agreement, the Panel observed that "the firs t sentence of Article 6.10 provides
that the investigating authorities must, 'as a rule ', calculate an individual dumping margin for each
known exporter or producer of the product under investigation" 488 and that "[t]he wording of

485See European Union's appellant's submission, para. 108.
486Panel Report, para. 7.77.
487Panel Report, paras. 7.98 and 7.112.
488Panel Report, para. 7.88.

Article 6.10, particularly the fact that the excepti on is stated immediately after the rule, seems to
suggest that sampling is the sole exception to the rule of individual margins".
489
312. The European Union claims that Article 6.10 should not be read as establishing a rule subject
to a single exception and that it does not impose an unqualified obligation, but rather states a
preference for determining individual dumping margins. The European Union maintains that the term
"as a rule", which is inserted after the word "shall" , "indicate[s] that the obligation is only a general
principle and not a strict obliga tion that is to be complied with in any and all circumstances".
490 The
European Union observes that Article 6.10 refers to one affirmative situation (sampling) where such a
preference "may" not be followed, and argues that "s ampling" is not the only situation in which a
Member is not required to determine individual dumping margins. 491 According to the
European Union, that Article 6.10, first sentence, does not contain a strict rule, as the Panel found, but
a preference, is borne out by the existence of other situations where the preference does not need to be
followed.
313. China responds that the use of the word "shall" in the first sentence of Article 6.10 establishes
the mandatory nature of this provision, and that "s ampling" is the only exception to this rule. In
China's view, the expression "as a rule" is necessary to the extent that it creates a "link between the
obligation contained in Article 6.10 first sentence wh ich constitutes the rule and the exception to that
rule included in the second sentence of that provision". 492 According to China, if the drafters'
intention was to allow more exceptions than "sam pling", they would have expressly mentioned that
the derogation from the general rule was permitted in situations othe r than the one mentioned in the
second sentence of Article 6.10.493
314. We observe that two main interpretative questions are raised in respect of the Panel's findings
under Article 6.10. First, whether the first sentenc e of Article 6.10, through the use of the terms
"shall" and "as a rule", expresses a mandatory rule or a mere preference to determine individual
margins of dumping. Second, whether "sampling" , as permitted by the second sentence, is the only
exception to the rule formulated in the first sentence.

489Panel Report, para. 7.90. Investigating authorities may resort to sampling when the number of
exporters, producers, importers or types of products is so large as to make individual dumping margin
determinations impracticable. In such cases, the authorities may limit their examination either: (i) to a
reasonable number of interested parties or products by usi ng samples, which are statistically valid; or (ii) to the
largest percentage of the volume of exports from the country in question that can reasonably be investigated.
490European Union's appellant's submission, para. 114.
491European Union's appellant's submission, para. 117.

315. Article 6.10 of the Anti-Dumping Agreement reads:
The authorities shall, as a rule, determine an individual margin of
dumping for each known exporter or producer concerned of the
product under investigation. In cases where the number of exporters,
producers, importers or types of prod ucts involved is so large as to
make such a determination imprac ticable, the authorities may limit
their examination either to a reas onable number of interested parties
or products by using samples which are statistically valid on the basis
of information available to the auth orities at the time of the selection,
or to the largest percentage of the volume of the exports from the
country in question which can reasonably be investigated.
494
316. We note that the auxiliary verb "shall" is commonly used in legal texts to express a mandatory
rule. In the phrase "[t]he authorities shall, as a rule, determine an individual margin of dumping for
each known exporter or producer"495, "shall" is followed by the term "as a rule". The definition of the
latter term includes "usually" and "more often than not". 496 The combination of the terms "shall" and
"as a rule" does not connote a mere preference. Ha d the drafters of Article 6.10 wanted to avoid
formulating an obligation to determine individual dumping margins, they would have used terms such
as "it is desirable" or "in principle" instead of "shall".
317. Although the term "shall" renders the rule in the first sentence of Article 6.10 mandatory, this
obligation is qualified by the term "as a rule", and this qualification must have a meaning. In our
view, the term "as a rule" in the first sentence in dicates that this obligation is not absolute, and
foreshadows the possibility of excep tions. Absent the insertion of "as a rule" in the first sentence of
Article 6.10, the obligation to determine individual margins would be difficult to reconcile with other
provisions of the Anti-Dumping Agreement that permit derogations fro m the rule to determine
individual dumping margins. However, while the term "as a rule" should be read as modifying the
obligation to determine individual margins, it does not render it a mere preference. Otherwise, the use
of "shall" in the first sentence would be deprived of its ordinary meaning.

494Article 6.10.2 reads:
In cases where the authorities have limited their examination, as provided
for in this paragraph, they shall nevertheless determine an individual margin
of dumping for any exporter or producer not initially selected who submits
the necessary information in time for that information to be considered
during the course of the investigation, except where the number of exporters
or producers is so large that individual examinations would be unduly
burdensome to the authorities and prevent the timely completion of the
investigation. Voluntary responses shall not be discouraged.
495Emphasis added.
496Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University Press, 2007),
Vol. 1, p. 126.

318. The second sentence of Article 6.10 allows i nvestigating authorities to depart from the
obligation to determine individual dumping ma rgins in cases where the number of exporters,
producers, importers, or types of products is so la rge as to make such determinations impracticable.
In such cases, the authorities may limit their examination either: (i) to a reasonable number of
interested parties or products by using samples, whic h are statistically valid; or (ii) to the largest
percentage of the volume of exports from the country in question that can reasonably be investigated.
This limited examination is gene rally referred to as "sampling", even where a statistically valid
sample is not used but the second alterna tive for limiting the examination is used.
497 Sampling is the
only exception to the determination of individual dumping margins that is expressly provided for in
Article 6.10.
319. According to Article 6.10.2, even if the aut horities have limited their examination based on
sampling, they are nevertheless required to dete rmine an individual margin of dumping for any
exporter or producer not initially selected for indi vidual examination if th at exporter submits the
necessary information in time during the investigatio n. We observe, however, that Article 6.10.2 also
permits investigating authorities not to determ ine individual dumping margins for exporters or
producers who are not initially selected for sampling, even if they submit the necessary information
on time, if the number of producers is so large that individual examinations of each of them would be
unduly burdensome and prevent the timely completion of the investigation. Again, a derogation from
the rule that an individual margin be determined is explicitly provided for in Article 6.10.2. We find
relevant context to the interpretation of Article 6.10 also in Article 9.5 of the Anti-Dumping
Agreement. Article 9.5 requires investigating authorities to determine individual dumping margins for
exporters or producers who have not exported the product during the period of investigation.
However, when new exporters cannot show that th ey are not related to any of the exporters or
producers that are subject to the anti-dumping duties, such an individual determination is not required.
Thus, an exception permitting derogation from the rule requiring the determination of individual
margins for new exporters is again expressly provided for in Article 9.5.
320. By inserting the term "shall, as a rule", the drafte rs of Article 6.10 were careful not to express
an obligation that would conflict with other provisions in the Anti-Dumping Agreement permitting
derogation from the rule to determine indivi dual margins of dumping apart from the sampling
exception, and would oblige investigating authorities to determine individual margins of dumping in
all cases. However, in our view, such exceptions mu st be provided for in the covered agreements, so
as to avoid the circumvention of the obligation to determine individual margins of dumping in
Article 6.10. The term "as a rule" in the first sen tence not only anticipates the exception that follows

497Panel Report, para. 7.85.

in the second sentence of Article 6.10, but also other provisions in the Anti-Dumping Agreement that
allow Members to depart from the requirement to determine individual margins of dumping. At the
same time, we do not consider that the flexibilit y provided by the term "as a rule" goes as far as
providing Members with an open-ended possibility to create exceptions, which would erode the
obligatory character of Article 6.10. It would be incompatible with the existence of such an
obligation if Members were free to depart from it by unilaterally determining what qualifies as an
applicable exception. The general rule, that is, the obligation to determine individual margins of
dumping for each known exporter or producer, applies, unless derogation from it is provided for in the
covered agreements.
321. In support of its position that sampling is not the only exception to the determination of
individual dumping margins and that other exceptions not specified in the Anti-Dumping Agreement
are allowed, the European Union cites several examples of other situations where the rule to
determine individual dumping margins of Article 6.10 need not be observed.
322. The first example cited by the European Un ion concerns a non-cooperating exporter or
producer for whom the dumping margin is calculate d based on facts available. We observe, however,
that Article 6.8 of the Anti-Dumping Agreement allows an investigating authority to rely on "facts
available" if an exporter or producer does not co operate, and that the margin applied to the non-
cooperating exporter or producer would still be an individual one even if it is calculated based on facts
available rather than on information provided by the exporter or producer.
323. The second example put forward by the European Union, namely, a "mere trader" that exports
the product of another producer and that is assigned the dumping margin of the actual producer, is
clearly based on the first sentence of Article 6.10, which refers to "exporters or producers". The
reference to "exporters or producers"
498 allows investigating authorities not to determine a separate
margin of dumping for the producer and the exporter of the same product, but a single one for both.
This, however, does not constitute an exception to th e requirement to determine individual margins,
but rather constitutes an application of this very rule.
324. The third example cited by the European Union refers to cases where an authority is unable to
identify the actual producer of the product concerned. This situation is comp atible with the correct
interpretation of the first sentence of Article 6.10, which requires that individual dumping margins be
determined merely for each "known" exporter or pr oducer. When an investigating authority is not
able to identify an exporter or producer, it cannot be considered as "known" within the meaning of

498Emphasis added.

Article 6.10, and thus the authority cannot be exp ected to calculate an individual margin for that
exporter or producer.
325. The fourth example provided by the European Union concerns those situations where an
authority decides to construct normal value and ex port prices for all producers or exporters on the
basis of the same information because it is unable to verify all the necessary information. We observe
that the possibility of resorting to constructed nor mal value and export price is explicitly provided for
in Article 2 of the Anti-Dumping Agreement and, as such, it cannot be characterized as a non-specified
exception to Article 6.10. In any event, the fact th at an authority may have to construct normal value
and/or export price for one or more exporters or producers does not necessarily imply a departure
from the rule in Article 6.10. Dumping margins based on constructed norma l value and export price
based on the same information for many suppliers are not the same as a country-wide margin.
326. Finally, in its fifth example, the European Un ion refers to the situation of a known producer
that does not export the product during the period of investigation and that will not be entitled to an
individual dumping margin because it is related to existing exporters or producers. As noted above
499,
this situation is expressly provided for in Article 9.5 of the Anti-Dumping Agreement , which
establishes that new exporters or producers will be entitled to individual duties in a review only if they
can show that they are not related to any of th e exporters or producers subject to the original
investigation.
327. We thus consider that the examples cited by the European Union involve situations that either
do not constitute departures from the individual margin s rule or are provided for in Article 6.10 itself
or in other provisions of the Anti-Dumping Agreement . Indeed, the term "as a rule" in the first
sentence of Article 6.10 anticipates the possibilit y of departures from the general rule, but as
explained above, any such exceptions must be provided for in the covered agreements. In this respect,
we consider that the examples cited by the European Union are consistent with the binding nature of
the rule set forth in the first sentence of Article 6.10 and, therefore, do not support the European
Union's claim that Article 6.10 states a mere preference.
328. Having said that, we do not find any provision in the covered agreements that would allow
importing Members to depart from the obligation to determine individual dumping margins only in
respect of imports from NMEs . We have explained above 500 that Section 15 of China's Accession
Protocol permits derogation in respect of the domestic price or normal value aspect of price
comparability, but does not address the export price asp ect of price comparability. It, therefore, has

499See supra, para. 319.
500See supra, section IV.C of this Report.

no entailment in respect of the obligation in Article 6.10 of the Anti-Dumping Agreement to determine
individual dumping margins. In our view, theref ore, Section 15 of China's Accession Protocol does
not provide a legal basis for flexibility in respect of export prices and for justifying an exception to the
requirement to determine individual dumping margins in Article 6.10 of the Anti-Dumping
Agreement.
329. In the light of the above, we interpret Article 6.10 of the Anti-Dumping Agreement as
expressing an obligation, rather than a preference, for authorities to determine individual margins of
dumping. This obligation is qualif ied and is subject not only to the exception specified for sampling
in the second sentence of Article 6.10, but also to ot her exceptions to the rule to determine individual
dumping margins that are provided for in the covered agreements.
(b) Article 9.2 of the Anti-Dumping Agreement
330. In its analysis of the consistency of Article 9(5) of the Basic AD Regulation with Article 9.2
of the Anti-Dumping Agreement , the Panel noted important sim ilarities between Article 9.2 and
Article 6.10 of the Anti-Dumping Agreement . Although Article 6.10 concerns dumping margin
calculations and Article 9.2 concerns duty imposition, these two provisions relate to "the same general
obligation" to "provide individual treatment" to exporters and producers in the context of anti-
dumping proceedings. 501 The Panel interpreted Article 9.2 of the Anti-Dumping Agreement as
requiring investigating authorities to name the indivi dual suppliers, that is, the exporters or producers,
on whom anti-dumping duties are imposed, except when the number of exporters or producers is so
large that it would be impracticable to do so, in which case the authorities would be allowed to name
the supplying country. Accordingly, the Panel c oncluded that Article 9.2 "does not … allow the
imposition of a single country-wide anti-dumping duty in an investigation involving [an NME]".502
331. There are a number of interpretative questions th at arise under Article 9.2. The first question
is whether the first and second sentences of Article 9.2 require investigating authorities to specify
anti-dumping duties for individual suppliers or merely to specify the names of the suppliers of the
product concerned. The second question concerns the scope of the exception to this rule contained in
the third sentence of Article 9.2 that permits the authorities to name the supplying country concerned
when it is "impracticable" to name all individual suppliers. Specifically, the question is whether this
exception is limited to the sampling scenario or whether it also covers situations where it would not be
"effective" to impose individual duties in respect of NMEs, as the European Union suggests.

501Panel Report, para. 7.108.
502Panel Report, para. 7.112.

332. Article 9.2 of the Anti-Dumping Agreement provides:
When an anti-dumping duty is imposed in respect of any product,
such anti-dumping duty shall be collected in the appropriate amounts
in each case, on a non-discriminatory basis on imports of such
product from all sources found to be dumped and causing injury,
except as to imports from those sources from which price
undertakings under the terms of this Agreement have been accepted.
The authorities shall name the supplier or suppliers of the product
concerned. If, however, several suppliers from the same country are
involved, and it is impracticable to name all these suppliers, the
authorities may name the supplying country concerned. If several
suppliers from more than one country are involved, the authorities
may name either all the suppliers involved, or, if this is
impracticable, all the supplying countries involved.
333. The European Union claims on appeal that, like Article 6.10 of the Anti-Dumping Agreement,
Article 9.2 does not contain a mandatory rule re garding the imposition of individual anti-dumping
duties, but merely a principle or a preference. The European Union argues that Article 9.2 of the
Anti-Dumping Agreement reflects a product-wide and country-wide approach in that it refers to the
imposition of an anti-dumping duty on a "product", not a company.
503
334. China responds that "the wording of Article 9.2 read in its context" (including Article 6.10)
"confirms that Article 9.2 contains the obligatio n for investigating authorities to impose anti-dumping
duties on an individual basis and that the only exception to that rule is the one identified in Article 9.2,
third sentence".504 China submits that there is no contradiction in acknowledging that the imposition
of anti-dumping duties is made with respect to "p roducts" as well as for each "producer" or "exporter"
concerned. In China's view, the fact that Article 9.2, first sentence, refers to the imposition of
anti-dumping duties with respect to a "product" does not entail an authorization to impose country-
wide duties.505
335. We observe that the fact that anti-dumping duti es are imposed on products is not inconsistent
with the requirement that dumping margins and an ti-dumping duties be specified for each individual
supplier. The Anti-Dumping Agreement contains rules that focus on products as well as importers,
exporters, and producers. Article 9.2 itself refers to both products and suppliers. We do not consider,
therefore, that a focus on products in certain provisions of the Anti-Dumping Agreement is
inconsistent with the requirement that anti-dumping duties be specified by supplier in the appropriate
amounts in each case.

503European Union's appellant's submission, paras. 160 and 161.

336. Article 9.2 states that anti-dumping duties " shall be collected in the appropriate amounts in
each case" and that "authorities shall name the supplier or suppliers of the product concerned".506 It is
thus clear from the wording of this provision, which uses the auxiliary verb "shall", that the collection
in appropriate amounts of anti-dumping duties and the naming of the supplier are of a mandatory
nature. The mandatory nature of the first and second sentences of Article 9.2 can be contrasted with
the preference expressed in the second sentence of Ar ticle 9.1 for duties lesser than the margin of
dumping, if lesser duties are adequate to remove the injury to the domestic industry. To express such
a preference, Article 9.1 uses the expression "it is desirable".
337. The European Union claims that Article 9.2 do es not impose an obligation to grant individual
treatment to exporters or producers, but merely cont ains an obligation to "specify by name" exporters
or producers. 507 According to the European Union, the term "appropriate" in the first sentence of
Article 9.2 may be interpreted as referring to "the duty rate appropriate to the country concerned", and
the "source" found to be dumped and causing injury within the meaning of Article 9.2 "could be the
relevant country".
508 China rejects the European Union's reading of the term "appropriate" in
Article 9.2, first sentence, as referring to the "dut y rate appropriate to the country concerned", and
submits that the use of the word "appropriate" ra ther "confirms" the rule that "anti-dumping duties
must be imposed on an individual basis".509
338. We note that Article 9.2 of the Anti-Dumping Agreement requires that anti-dumping duties be
collected on a non-discriminatory basis from "all sources" found to be dumped and causing injury,
except from "those sources" from which price undertaki ngs have been accepted. We agree with the
Panel that the term "sources", which appears twice in the first sentence of Article 9.2, has the same
meaning and refers to individual exporters or producers and not to the country as a whole. 510 This is
indicated by the fact that price undertakings me ntioned in the first sentence of Article 9.2 are
accepted, according to Article 8 of the Anti-Dumping Agreement, from individual exporters and not
from countries. Therefore, the requirement under Ar ticle 9.2 that anti-dumping duties be collected in
appropriate amounts in each case a nd from all sources relates to th e individual exporters or producers
subject to the investigation.511

506Emphasis added.
507European Union's appellant's submission, para. 163.
508European Union's appellant's submission, para. 161.
510Panel Report, para. 7.103.
511We address below the situation where an authority can demonstrate that "exporters or producers"
constitute a single entity with the State.

339. We have concluded above that Article 6.10 of the Anti-Dumping Agreement contains an
obligation to determine individual dumping ma rgins for each exporter or producer, except when
sampling is used or if a derogation is otherwise pr ovided for in the covered agreements. We observe
that, where an individual margin of dumping h as been determined, it flows from the obligation
contained in the first sentence of Article 9.2 that the appropriate amount of anti-dumping duty that
can be imposed also has to be an individual one . We do not see how an importing Member could
comply with the obligation in the first sente nce of Article 9.2 to collect duties in the appropriate
amounts in each case if, having determined individu al dumping margins, it lists suppliers by name,
but imposes country-wide duties. In othe r words, unless sampling is used, the appropriate amount of
an anti-dumping duty in each case is one that is specified by supplier, as further clarified and
confirmed by the obligation to name suppliers in the second sentence of Article 9.2.
512
340. The second sentence of Article 9.2 contains a re quirement that authorities name the supplier
or suppliers of the product concerned. It is not clear from the terms of the second sentence alone what
the purpose of naming suppliers would be, considering that the term "name" can be defined simply as
"mention or specify by name". 513 However, in our view, the content of the obligation "to name" is
clarified by the requirements in the first sentenc e that anti-dumping duties be collected in the
appropriate amounts on a non-discriminatory basis from all sources.
341. An interpretation of Article 9.2, second sentence, as requiring the specification of
anti-dumping duties by individual suppliers is also co nfirmed by the context provided by Article 9 of
the Anti-Dumping Agreement as a whole. Article 9 of the Anti-Dumping Agreement sets forth specific
rules concerning the imposition of anti-dumping duties. Paragraph 1 states that it is desirable that the
duty be less than the margin if a lesser duty would be adequate to remove injury; paragraph 2 requires
that duties be imposed in the appropriate amounts a nd that authorities name suppliers, unless to do so
would be impracticable; paragraph 3 states th at the amount of the duty should not exceed the
dumping margin; paragraph 4 sets forth rules for the application of anti-dumping duties to imports
from exporters or producers not included in the sa mple; and paragraph 5 provides for reviews to
determine individual margins for new exporters or producers. All the paragraphs of Article 9 set forth
rules concerning the imposition of anti-dumping duties, as reflected in the title of this provision,
"Imposition and Collection of Anti-Dumping Duties". A ll the paragraphs of Article 9, read together,

512The requirement in Article 9.2 to specify duties by individual suppliers is also consistent with the
obligation in that provision not to discriminate in the collection of duties on imports from all sources found to be
dumped and causing injury. In this case, if an indi vidual dumping margin has been determined for each
exporter or producer consistently w ith Article 6.10, the principle of non-discrimination requires that each
exporter or producer obtains an anti-dumping duty that corresponds to its individual dumping margin.
513Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University Press, 2007),
Vol. 2, p. 1887.

thus suggest that the obligation to name individua l suppliers in the second sentence of paragraph 2 is
closely related to the imposition of individual anti- dumping duties and that the requirement to name
suppliers that are subject to imposition and collec tion of anti-dumping duties should be interpreted as
a requirement to specify duties for each supplier.514
342. Having concluded that the first and second sente nces of Article 9.2 contain obligations to
specify individual anti-dumping duties and to name suppliers, we now turn to the third sentence of
Article 9.2. It provides for an exception, which allows importing Members to specify duties for the
supplying country concerned, where specification of individual suppliers is "impracticable".
343. The European Union claims that the Panel erred in finding that Article 9(5) of the Basic AD
Regulation does not fall within the exception under Article 9.2, third sentence, of the Anti-Dumping
Agreement. It argues that, like Article 6.10, Article 9.2 expressly permits the imposition of duties on
a country-wide basis in cases other than "sampling", in particular when it is "impracticable" to impose
duties and name suppliers on an individual basis, consistently with the notion that these provisions
"should … be interpreted in a flexible manner". 515 China submits that the Panel correctly concluded
that Article 9.2 requires that anti-dumping duties be imposed on an individual basis and that a
country-wide duty can only be imposed in the circumst ances described in Article 9.2, third sentence.
In China's view, however, the third sentence does not authorize generally the imposition of a country-
wide duty in the case of imports from NMEs.
344. We observe that there is significant parallelis m between Article 6.10 and Article 9.2 of the
Anti-Dumping Agreement. Article 6.10 requires the determinati on of individual margins of dumping,
which corresponds to the obligation to impose anti-dumping duties on an individual basis in
Article 9.2. We further note that the fact that the same term "impracticable" is used in both
Article 6.10 and Article 9.2 to describe when the exception applies provides an indication that both
exceptions refer to the situation where an authority determines dumping margins based on sampling.
345. The interpretative question before us, however , does not concern the precise scope of the
exception in the third sentence of Article 9.2, and whether it exactly overlaps with the exception for
sampling in Article 6.10 or it has a broader scope. Rather, the issue is whether this exception may be

514We also note that Article 9(5) of the Basic AD Regulation, which according to the European Union
"bring[s] into the EU's legal order" and "mirrors the language of Article 9.2 of the Anti-Dumping Agreement"
(European Union's appellant's submission, para. 95), appears to interpret the first two sentences of Article 9.2 as
containing a requirement to specify anti-dumping duties by individual suppliers. Article 9(5) of the Basic AD
Regulation states in relevant part that "[t]he Regulation imposing the duty shall specify the duty for each
supplier or, if that is impracticable, and in general wh ere Article 2(7)(a) applies, the supplying country
concerned". (emphasis added)
515European Union's appellant's submission, para. 168.

interpreted as permitting the situation envisaged in Ar ticle 9(5) of the Basic AD Regulation, that is,
the imposition of a country-wide duty on suppliers from NMEs that do not fulfil the IT test under
Article 9(5). In particular, we need to ascertain whether it can be considered "impracticable" to
impose individual anti-dumping duties on suppliers from NMEs that do not meet the IT test.
346. The European Union contends that the exception in the third sentence of Article 9.2 covers
situations such as those envisaged in Article 9(5) of the Basic AD Regulation, which provides for the
imposition of country-wide duties where anti-dumping duties cannot be imposed on an individual
basis for "practical" reasons.
516 The European Union explains that it would not be "effective" to
impose individual anti-dumping duties on suppliers that are all related to the State, because this may
lead to the circumvention of the higher anti-dum ping duties imposed on some individual exporters by
channelling exports through related exporters with the lowest anti-dumping duties.
517
347. We observe that the dictionary definition of the word "impracticable" is "[n]ot practicable;
unable to be carried out or done; impossible in practice". 518 The dictionary definition of the word
"ineffective" is "[n]ot producing any, or the desi red effect; ineffectual, inoperative, inefficient". 519 It
is evident from the dictionary definitions that "i mpracticable" and "ineffective" describe different
qualities or characteristics of an action. Thus, the no tion of "ineffective" is not included in the notion
of "impracticable". In particular, we observe th at the notion of "ineffective" is concerned with
bringing about or producing an effect or result, which is absent from the notion of "impracticable",
which describes the action itself.
348. The reasons adduced by the European Union to justify the imposition of a country-wide duty
on non-IT suppliers from NMEs focus on effectiveness rather than on practicability. In other words,
if the State in an NME were able to circumvent individual anti-dumping duties imposed on suppliers
by channelling exports through the exporter with th e lowest duty rate, this may mean that individual
anti-dumping duties are "ineffective" to counter dumping, not that their imposition is "impracticable".
In our view, Article 9.2, third sentence, allows Members to name the supplying country concerned
only when it is impracticable to name individual suppliers; it does not permit naming the supplying
country when the imposition of individual duties is ineffective because it may result in circumvention
of the anti-dumping duties.

516European Union's appellant's submission, para. 172.
517European Union's appellant's submission, para. 186.
518Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University Press, 2007),
Vol. 1, p. 1332.
519Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University Press, 2007),
Vol. 1, p. 1363.

349. We further note that the very content and structure of Article 9(5) of the Basic AD Regulation
reveals that the IT test and "impracticability" in Article 9.2 refer to different situations. We recall that
Article 9(5) of the Basic AD Regulation states in relevant part:
An anti-dumping duty shall be imposed in the appropriate amounts in
each case, on a non-discriminatory basis on imports of a product
from all sources found to be dumped and causing injury, except for
imports from those sources from wh ich undertakings under the terms
of this Regulation have been acc epted. The Regulation imposing the
duty shall specify the duty for each supplier or, if that is
impracticable, and in general where Article 2(7)(a) applies, the
supplying country concerned. (emphasis added)
350. Thus, Article 9(5) itself distinguishes situations where the imposition of individual duties
would be "impracticable" from situations where Artic le 2(7)(a) applies, that is, where exporters from
NMEs will receive a country-wide duty unless they meet the IT test. The use of the conjunction "and"
in Article 9(5) suggests that these are two separate situations justifying departure from the individual
duty rule and that the imposition of country-wide duties on NME suppliers does not fall within the
"impracticability" exception, because it is reflected as a separate exception.
351. In the light of the above, we do not consider that the exception in the third sentence of
Article 9.2 of the Anti-Dumping Agreement , which permits naming the supplying country where
naming individual suppliers is "impracticable", authorizes the European Union to impose country-
wide duties on suppliers from NMEs that do not meet the IT test in Article 9(5) of the Basic AD
Regulation.
352. The European Union further submits that its in terpretation of the exception to the individual
treatment of suppliers in the third sentence of Article 9.2, as permitting the imposition of country-
wide duties on suppliers from NMEs who do not qualify for individual treatment under Article 9(5), is
also confirmed by the analysis of supplementary means of interpretation. In particular, the
European Union refers to the negotiating history and the circumstances of the conclusion of the
Kennedy Round Anti-Dumping Code.
520
353. We have concluded above, based on the text of the provision read in its context, that
Article 9.2 of the Anti-Dumping Agreement requires the imposition of anti-dumping duties on an
individual basis and that the exception in the third sentence of Article 9.2 does not justify the
imposition of country-wide duties on non-IT suppliers from NMEs. We, therefore, consider that we
do not need to have recourse to supplementary means of interpretation under Article 32 of the Vienna

520European Union's appellant's submission, para. 175.

Convention, such as the preparatory work of the treaty and the circumstances of its conclusion, in
order to confirm or determine the meaning resulting from the application of Article 31.
354. We thus conclude that Article 9.2 of the Anti-Dumping Agreement requires investigating
authorities to specify an individual duty for each s upplier, except where this is impracticable, when
several suppliers are involved. We reach this conclusion by reading the first sentence of Article 9.2 in
conjunction with the second sentenc e of Article 9.2. The first sentence requires investigating
authorities to collect anti-dumping duties in the appropriate amounts in each case and on a non-
discriminatory basis on imports from all sources —that is, suppliers—while the second sentence
requires investigating authorities to name the supplier or suppliers of the product concerned. We also
consider that the exception in the third sentence of Article 9.2 does not allow the imposition of a
single country-wide anti-dumping duty in investiga tions involving NMEs where the imposition of
individual duties is alleged to be "ineffective", but is not "impracticable".
2. Application of Articles 6.10 and 9.2 of the Anti-Dumping Agreement
355. The European Union claims that, even assumi ng that the Panel correctly interpreted
Articles 6.10 and 9.2 of the Anti-Dumping Agreement , it erred in the application of Articles 6.10
and 9.2 and, in doing so, also acted inconsistently with Article 11 of the DSU. The European Union
argues that the Panel ignored its contention that the f unction of the IT test in Article 9(5) of the Basic
AD Regulation is to identify the actual source of pr ice discrimination in the context of imports from
NMEs, and thus determine if the State and those entities that do not act independently from the State
in NMEs should be treated as a single supplier for the purposes of Articles 6.10 and 9.2.
521 T h e
European Union relies on the findings of the panel in Korea – Certain Paper, which, in its view, stand
for the proposition that, for the purpose of determ ining individual dumping margins, Article 6.10
permits investigating authorities to determine that two or more exporters and producers are part of the
same entity.522
356. The Panel found that, unlike the test in Korea – Certain Paper , the IT test does not serve the
purpose of establishing whether the State and the exporte rs or producers are in fact a single entity, nor
does it identify the actual source of price discrimination. 523 Moreover, the Panel found that the IT
test, unlike the test in Korea – Certain Paper , is based on a presumption that in NMEs the State and
the exporters constitute a single legal entity and that such a presumption has no legal foundation in the
covered agreements.

521European Union's appellant's submission, para. 191.
522European Union's appellant's submission, para. 139 (referring to Panel Report, Korea – Certain
Paper, paras. 7.163-7.168).
523Panel Report, paras. 7.94 and 7.106.

357. In the next sections, we first address the questi ons of whether the presumption in Article 9(5)
of the Basic AD Regulation that in NMEs all expor ters and producers are related to the State is
consistent with the provisions of the Anti-Dumping Agreement and whether the Panel acted
inconsistently with Article 11 of the DSU because it disregarded evidence submitted by the
European Union relating to such a presumption. We then address the question of whether an
importing Member may determine that the exporter s and producers from an NME constitute a single
legal entity together with the State for the purposes of applying Articles 6.10 and 9.2 of the
Anti-Dumping Agreement ; more specifically, we will explore whether the operation of the IT test
results in the identification of such a single entity.
(a) Whether the European Union Is Entitled to Presume that in NMEs
the State and the Exporters Constitute a Single Entity
358. The panel in Korea – Certain Paper found that Article 6.10 could be interpreted as allowing
the treatment of legally separate entities as a single supplier in "cir cumstances where the structural
and commercial relationship between the companies in question is sufficiently close to be considered
as a single exporter or producer". 524 The panel then went on to find that the majority shares of the
three companies in question were owned by the same parent company, which had thus considerable
controlling power over the operations of the three co mpanies concerned; that there were important
commonalities of management between the three co mpanies where most of the directors of each
company were present on the board of directors of th e other companies; and that the three companies
had the ability to shift production amongst themsel ves, to harmonize commercial activity and basic
common corporate objectives, and to make their domestic sales through the same company.
Accordingly, the panel concluded that these co mpanies were in a structural and commercial
relationship that justified treating them as a single exporter or producer for purposes of Article 6.10 of
the Anti-Dumping Agreement.
525
359. We recall that under the IT test in Article 9( 5) of the Basic AD Regulation an exporter from
an NME that did not qualify for market economy trea tment under Article 2(7)(c) is not entitled to an
individual anti-dumping duty unless it can demonstrate that:
(a) in the case of wholly or partly foreign owned firms or joint
ventures, exporters are free to repatriate capital and profits;
(b) export prices and quantities, and conditions and terms of sale are
freely determined;

(c) the majority of the shares belong to private persons; state
officials appearing on the board of directors or holding key
management positions shall either be in minority or it must be
demonstrated that the comp any is nonetheless sufficiently
independent from State interference;
(d) exchange rate conversions are ca rried out at the market rate; and
(e) State interference is not such as to permit circumvention of
measures if individual exporters are given different rates of
duty."
360. The Panel considered that there is a fundamenta l difference between the IT test and the test
applied by the panel in Korea – Certain Paper . In its view, the latter test requires investigating
authorities to demonstrate the existence of a clos e structural and commercia l relationship between a
number of producers such that they constitute a si ngle supplier for which a single dumping margin
may be calculated and a single anti-dumping duty may be applied. By contrast, under the IT test, the
European Union presumes that in NMEs all exporte rs and producers are related to the State (and
subject to a country-wide dumping margin and anti-dumping duty) unless a producer demonstrates
that it has no such relationship with the State and thus qualifies for individual treatment. According to
the Panel, applying such a presumption to NME producers "would seriously undermine the logic of
Article 6.10", which requires that individual ma rgins be calculated for each known exporter or
producer.
526
361. The European Union submits that in the case of market economies, as found by the panel in
Korea – Certain Paper , the close relationship between separate legal entities has to be established by
the investigating authority on a case-by-case basis; by contrast, in NMEs "the presumption of State
control is the general rule". 527 The European Union also contends that the Panel acted inconsistently
with Article 11 of the DSU, because it disreg arded evidence submitted by the European Union
concerning the nature of NMEs and China's status as an NME, as well as the fact that China's
Accession Protocol entitles the European Union to treat China as an NME until 2016. This evidence,
which, according to the European Union, was not contested by China, supports the presumption
underlying Article 9(5) of the Basic AD Regulatio n that all producers and exporters in an NME
constitute a single entity together with the State.
362. China responds that the presumption advocated by the European Union that in NMEs the
State and exporters constitute a single entity has no le gal basis in the covered agreements and China's

526Panel Report, para. 7.96.
527European Union's appellant's submission, para. 150.

Accession Protocol in particular. China further argues that its Accession Protocol does not reflect a
general understanding or recognition that China is an NME. Paragraph 15(a) merely authorizes WTO
Members to apply until 2016 a temporary and lim ited derogation from certain rules in the
Anti-Dumping Agreement concerning normal value. Pursuant to paragraph 15(d), these Members may
discontinue the application of paragraph 15(a) prior to that date with respect to certain industries or
the entire economy.528 In any event, China points out that wh ether China is a market economy or an
NME is irrelevant for the purposes of this case, be cause there is no basis under Articles 6.10 and 9.2
of the Anti-Dumping Agreement to distinguish between imports from market economies and imports
from NMEs in relation to the determination of individual dumping margins and anti-dumping duties.
363. We recall that Article 9(5) of the Basic AD Regulation establishes a presumption that
producers or exporters that operate in NMEs are no t entitled to individual treatment; in order to
qualify for such treatment, NME exporters bear the bur den to demonstrate that they satisfy the criteria
of the IT test. We observe that under Articles 6.10 and 9.2 of the Anti-Dumping Agreement it is the
investigating authority that is called upon to make an objective affirmative determination, on the basis
of the evidence that has been subm itted or that it has gathered in the investigation, as to who is the
known exporter or producer of the product concerned. It is, therefore, the investigating authority that
will determine whether one or more exporters have a relationship with the State such that they can be
considered as a single entity and receive a single dumping margin and a single anti-dumping duty. In
other words, where certain exporters or producers are separate legal entities, that evidence will be
taken into account in treating them as separate e xporters or producers for purposes of Articles 6.10
and 9.2 of the Anti-Dumping Agreement . An investigating authority, however, may also need to
consider other evidence that demonstrates that le gally distinct exporters or producers are in a
sufficiently close relationship to constitute a singl e entity and should thus receive a single dumping
margin and anti-dumping duty. By contrast, under Ar ticle 9(5) of the Basic AD Regulation, country-
wide dumping margins and country-wide anti-dumping duties are established for exporters from NME
WTO Members unless such exporters request individua l treatment and demonstrate that they satisfy
all criteria of the IT test. Failure to meet only on e of those criteria leads to denial of individual
treatment.
364. We consider that placing the burden on NME exporters to rebut a presumption that they are
related to the State and to demonstrate that they are entitled to individual treatment runs counter to
Article 6.10, which "as a rule" requires that individual dumping margins be determined for each
known exporter or producer, and is inconsistent with Article 9.2 that requires that individual duties be
specified by supplier. Even accepting in principle that th ere may be circumstances where exporters

and producers from NMEs may be considered as a single entity for purposes of Articles 6.10 and 9.2,
such singularity cannot be presumed; it has to be determined by the investigating authorities on the
basis of facts and evidence submitted or gathered in the investigation.
365. We are also of the view that no other provision in the Anti-Dumping Agreement or in other
covered agreements provides a legal basis for the Eu ropean Union's presumption in Article 9(5) of its
Basic AD Regulation that results in exporters and producers from NMEs having to demonstrate that
they are unrelated to the State in order to qualify for individual treatment. In particular, we do not
consider that there is a legal basis in the provisi ons of China's Accession Protocol for a presumption
that country-wide dumping margins be calculated and country-wide duties be imposed on all Chinese
exporters of a product under investigation. We have explained above that Section 15 of China's
Accession Protocol is silent as to the individual and country-wide determination of dumping margins
and imposition of anti-dumping duties. Section 15 onl y permits derogations in respect of the use of
domestic prices and costs—that is, normal value—but not in respect of export prices in the calculation
of margins and the consequential imposition of duties.
366. It is true that paragraph 15(a) of China's Accession Protocol places the burden on Chinese
exporters to "clearly show" that market economy conditions prevail in order for the importing WTO
Members to be obliged to use Chinese domestic pric es and costs in determining price comparability.
However, this rule concerns only the normal valu e aspect of price comparability, and does not permit
derogation from the disciplines of the Anti-Dumping Agreement regarding export price.
Paragraph 15(a) of China's Accession Protocol does not provide a legal basis for a presumption that
an exporter's individual export prices cannot be used and that, as a consequence, country-wide export
prices should be used and hence country-wide margin s should be determined and country-wide duties
should be imposed. Neither can paragraph 15(d) be interpreted as authorizing WTO Members to treat
China as an NME for matters other than the determ ination of normal value. As explained above,
paragraph 15(d) does not pronounce generally on China's status as a market economy or NME.
Rather, it permits an importing WTO Member to specify when the special rules regarding normal
value contained in paragraph 15(a) no longer a pply—that is, either in 2016 or earlier—if China
establishes that it is a market economy or that mark et economy conditions exist in specific industries.
In the light of the above, we conclude that there is no legal basis in the covered agreements for the
general presumption that in an NME the State and al l exporters are sufficiently related to constitute a
single entity, for which a single export price and hence a single duty can be determined.
367. In our view, whether the European Union's presumption under Article 9(5) of its Basic AD
Regulation that in NMEs the State and all export ers constitute a single entity is consistent with

Articles 6.10 and 9.2 of the Anti-Dumping Agreement is a legal question, not a factual one that
depends on the economic structure of a particular WTO Member. Rather, the economic structure of a
WTO Member may be used as evidence before an i nvestigating authority to determine whether the
State and a number of exporters or producers subject to an investigation are sufficiently related to
constitute a single entity such that a single margin should be calculated and a single duty be imposed
on them. It cannot, however, be used to imply a legal presumption that has not been written into the
covered agreements.
368. The European Union submitted to the Pane l evidence that it claimed supported the
presumption in Article 9(5) of the Basic AD Regula tion that the State and the exporters are to be
treated as a single entity. In particular, the Eur opean Union provided a definition of an NME. It
referred to situations where the "State control ove r the means of production and State intervention in
the economy, including international trade, impl y that all the means of production and natural
resources belong to one entity, the State" and where "[a]ll imports from non-market economy
countries are therefore considered to emanate from a si ngle supplier, the State" so that "[t]he State in
this sense can be considered as one supplier".
529 The European Union also pointed to paragraph 15(d)
of China's Accession Protocol which, it argues, allows it to treat China as an NME until 2016 and
provided other evidence concerning China's intervention in its economy and international trade.530
369. We have explained above why we conclude that Section 15 of China's Accession Protocol
does not provide a legal basis for the European Unio n's presumption in Article 9(5) of the Basic AD
Regulation. We are also of the view that the ev idence submitted by the European Union concerning
NMEs in general and China in particular is not relevant to the legal question of whether the
European Union is permitted to presume under Article 9(5) of the Basic AD Regulation that the State
and the exporters are a single exporter fo r purposes of Articles 6.10 and 9.2 of the Anti-Dumping
Agreement. The review of this evidence reveals that it is possible that in specific circumstances an
investigating authority may reach the conclusion that the State and certain exporters are so closely
related that they constitute a single entity. Howe ver, the evidence submitted by the European Union
cannot establish that the economic structure in China justifies a general presumption that the State and
all the exporters in all industries that might be subject to an anti-dumping investigation constitute a
single legal entity, where no legal basis for such a presumption is provided for in the covered
agreements. Consequently, whether the Panel consid ered this evidence is of no relevance to the

529European Union's appellant's submission, para. 152 (quoting European Union's first written
530European Union's appellant's submission, para. 51. These include publications providing definitions
of NMEs and describing mechanisms relating to how th e Chinese Government intervenes in the economy and
international trade.

question of whether a legal presumption exists or wh ether the Panel made an objective assessment of
the matter pursuant to Article 11 of the DSU.
370. We have concluded above that a presumption that the State and all exporters or producers in
all industries in NMEs are sufficiently related to constitute a single entity lacks a legal basis in the
covered agreements. As such, the European Uni on's presumption is inconsistent with Articles 6.10
and 9.2 of the Anti-Dumping Agreement , which requires individual treatment for each exporter or
producer. Moreover, the evidence the European Unio n submitted to the Panel regarding the operation
of NMEs in general and China in particular was not relevant to the legal question of whether a
presumption is permitted. Therefore, irrespective of the evidence presented by the European Union,
the Panel did not err in finding that the Europ ean Union had not shown a legal basis for its
presumption. Thus, we also find that the Panel did not fail to comply with its duties under Article 11
of the DSU in its assessment of the evidence submitted by the European Union in support of its
presumption.
(b) Whether in NMEs the State and the Exporters Can Be Considered as
a Single Entity
371. The Panel understood the panel in Korea – Certain Paper to have found that Article 6.10 of
the Anti-Dumping Agreement does not preclude investigating authorities from treating multiple legally
distinct entities as a single exporter or producer fo r purposes of an anti-dumping investigation where
the structural and commercial relationship between th e companies in question is sufficiently close for
them to be considered as a single exporter or producer.
531 The Panel also stated that it is possible in
principle for an investigating authority to determin e that "one or more nominally distinct producer(s)
or exporter(s) is/are, in fact, sufficiently related to th e State to justify concluding that they are a single
producer or exporter".532
372. The Panel distinguished the situation before the panel in Korea – Certain Paper from
Article 9(5) of the Basic AD Regulation on the ground th at the criteria of the IT test in Article 9(5) do
not concern the structural and commercial relati onship between distinct legal entities, but are
concerned with the role of the St ate in the way business is conducte d in a given country. The Panel
noted that, under the European Union's approach, the State woul d be considered as a "parent
company" for potentially thousands of distinct le gal entities producing and exporting a product under

531Panel Report, para. 7.92.
532Panel Report, para. 7.94.

investigation. The Panel considered that this w as not a plausible application of the reasoning of the
panel in Korea – Certain Paper.533
373. The Panel also found that the IT test does not aim at ascertaining whether the State is the
"source of price discrimination" as the European Uni on claims. According to the Panel, even if an
exporter from an NME is able to determine its expor t prices—which would suggest that it is not the
State that is the source of the price discrimination—it would fail the IT test unless it meets all of the
other criteria.534
374. In our view, the panel in Korea – Certain Paper did not develop an interpretation that
expanded the meaning of the term "each known exporte r or producer", nor did it read new exceptions
into Article 6.10 of the Anti-Dumping Agreement . Rather, that panel considered that there may be
situations where several closely related suppliers may be deemed a single supplier for the purposes of
Article 6.10 and referred to a "struc tural and commercial relationship". 535 In the present dispute, the
Panel did not exclude the possibility that in a give n investigation the authorities might determine that
one or more legally distinct exporter(s) or producer(s) is/are, in fact, sufficiently related to the State to
justify a conclusion that they are a single exporter or producer. In such a situation, the Panel noted,
the authorities could well treat the exporter(s) or producer(s) and the State as a single exporter and
calculate a single dumping margin for, and assign a single duty to, that single exporter.536
375. Articles 6.10 and 9.2 of the Anti-Dumping Agreement require respectively that individual
dumping margins be determined for each exporter or producer and that individual anti-dumping
duties be imposed on individual suppliers. These requirements for individual treatment are respected,
the European Union contends, as long as a single count ry-wide margin and duty is determined for the
single State entity.
376. In our view, Articles 6.10 and 9.2 of the Anti-Dumping Agreement do not preclude an
investigating authority from determining a single dumping margin and a single anti-dumping duty for
a number of exporters if it establishes that th ey constitute a single exporter for purposes of
Articles 6.10 and 9.2 of the Anti-Dumping Agreement. Whether determining a single dumping margin
and a single anti-dumping duty for a number of export ers is inconsistent w ith Articles 6.10 and 9.2
will depend on the existence of a number of situati ons, which would signal that, albeit legally distinct,

533Panel Report, para. 7.93.
534Panel Report, para. 7.106.
535That panel report was not appealed and the issue of whether several suppliers can be considered as a
single supplier that is assigned an individual margin and duty, if they are in a suff iciently close commercial and
structural relationship, has not been addressed by any other panel.
536Panel Report, para. 7.94.

two or more exporters are in such a relationship that they should be treated as a single entity. These
situations may include: (i) the existence of corporat e and structural links between the exporters, such
as common control, shareholding and management; (ii) the existence of corporate and structural links
between the State and the exporters, such as comm on control, shareholding and management; and
(iii) control or material influence by the State in respect of pricing and output. We note that the
Anti-Dumping Agreement addresses pricing behaviour by exporters; if the State instructs or
materially influences the behaviour of several exporte rs in respect of prices and output, they could be
effectively regarded as one exporter for purposes of the Anti-Dumping Agreement and a single margin
and duty could be assigned to that single exporter. In our view, however, this is not the function of
the IT test.
377. The IT test contained in Article 9(5) of the Basic AD Regulation has a different function than
the determination of whether several distinct exporters constitute a single exporter because of
structural and commercial integration or due to co ntrol or material influence by the State. The
function of the IT test is to determine whether expor ters or producers are sufficiently distinct from the
State to overcome the presumption of singularity, such that they should be entitled to individual
treatment pursuant to Article 9(5). Such a test cannot be used to de termine whether distinct exporters
are sufficiently integrated with each other or w ith the State to constitute a single exporter.
Nonetheless, given that the purpose of the IT test is to demonstrate the independence of exporters
from State interference, we do not exclude that some of its elements would be relevant to the question
of integration, while others would not.
378. Only one of the five criteria of the IT test, for example, directly relates to the structural
relationship of the company with the State: the re quirement that the majority of the shares belong to
private persons and that State officials holding ma nagement positions be in the minority. Another
criterion relates to the State interference with pr ices and output. All the other criteria, however,
appear to be related to State interference with exporters or State intervention in the economy in
general and are likely to lead to the denial of indivi dual treatment with respect to exporters that have
little or no structural or commercial relationship with the State and whose pricing and output decisions
are not interfered with by the State. This is beca use the criteria of the IT test apply on a cumulative
basis and that failure to comply with only one of them will result in the denial of individual treatment
under Article 9(5).
379. Moreover, by focusing on State interference w ith exporters and State intervention in the
economy in general, the IT test captures broader market distortions in the economy and different
kinds of interferences by the State than that of th e control or material influence by the State over the

exporters in respect of pricing and output of a particular like product. As a consequence, the
cumulative criteria of the IT test are likely to resu lt in the denial of individual treatment where the
relationship between individual exporters and the Stat e is not such as to justify treating the State and
one or several exporters as a single entity for the purposes of Articles 6.10 and 9.2 of the
Anti-Dumping Agreement.
380. Therefore, even if, as the European Union argues, the purpose of the IT test was to identify
the actual source of price discrimination, we cannot see why the failure to comply with one of the
criteria of the IT test provides conclusive evid ence that the price discrimination by individual
suppliers can be attributed to the State, when some of the criteria do not touch on the question of
whether an exporter is free to determine its own pri ces. We thus consider that the IT test is not
capable of establishing whether, similar to the situation in Korea – Certain Paper , the State and one
or more exporters can be deemed a single en tity for purposes of Articles 6.10 and 9.2 of the
Anti-Dumping Agreement. Nevertheless, the test developed by the panel in Korea – Certain Paper
may not capture all situations where the State ef fectively controls or materially influences and
coordinates several exporters such that they can be considered a single entity. The panel in Korea –
Certain Paper addressed the question of when two or more legally distinct private companies can be
deemed a "single exporter" under Article 6.10 of the Anti-Dumping Agreement due to their
commercial and structural relationship. The situation analyzed by the panel in Korea – Certain Paper
presents some relevance to the determination of wh ether the State and several exporters constitute a
single entity. However, the criteria used for de termining whether a single entity exists from a
corporate perspective, while certainly relevant, w ill not necessarily capture all situations where the
State controls or materially influences several exporte rs such that they could be considered as a single
entity for purposes of Articles 6.10 and 9.2 of the Anti-Dumping Agreement and be assigned a single
dumping margin and anti-dumping duty.
381. Criteria relating to corporate structure may in certain circumstances be relevant to the
determination of whether the State and certain exporters constitute a single entity. In other
circumstances, however, an investigating authorit y might have to take into account factors and
positive evidence other than those establishing a co rporate or commercial relationship in assessing
whether the State and a number of exporters are a single entity and that, therefore, the State is the
source of price discrimination. These, for inst ance, may include evidence of State control or
instruction of, or material influence on, the behavi our of certain exporters in respect of pricing and
output. These criteria could show that, even in th e absence of formal structural links between the
State and specific exporters, the State in fact determines and materially influences prices and output.

382. In the light of the above, we are of the view th at in principle there may be situations where
nominally distinct exporters may be considered as a single entity for the purpose of determining
individual dumping margins and anti-dumping duties under Articles 6.10 and 9.2 of the Anti-Dumping
Agreement, due to State's control or material influen ce in and coordination of these exporters' pricing
and output. We reiterate, however, that the IT test in Article 9(5) of the Basic AD Regulation is not
directed at such an inquiry.
383. We further note that, even where it could be de termined that particular exporters that are
related constitute a single supplie r, Articles 6.10 and 9.2 of the Anti-Dumping Agreement would
nonetheless require the determination of an indivi dual dumping margin for the single entity, which
should be based on the average export prices of each individual exporter, and the imposition of a
corresponding single anti-dumping duty. Instead, the European Union does not determine such a
single dumping margin for the State and non-IT s uppliers, but rather calculates a country-wide
dumping margin and duty. If cooperating non-IT exporters account for significantly less than
100 per cent of all exports, this duty will be based on facts available for the missing information.
537
Such a country-wide dumping margin and duty is a pplicable to all cooperating non-IT exporters as
well as to all non-cooperating exporters.538
384. In our view, only a dumping margin that is based on a weighted average of the export prices
of each individual exporter that forms part of the si ngle entity would be consistent with the obligation
in Article 6.10 to determine an individual dumping margin for the single entity that is composed of
several legally distinct exporters. We also do not consider that a country-wide duty imposed on a
group of exporters could be considered as being "c ollected in the appropriate amounts in each case"
within the meaning of Article 9.2 of the Anti-Dumping Agreement, to the extent it is determined for
the group of fully cooperating non-IT exporters on the basis of facts available because cooperating
exporters account for significantly less than 100 per cent of all exports.
3. Conclusions under Articles 6.10 and 9.2 of the Anti-Dumping Agreement
385. In the light of all of the above, we therefor e uphold, albeit for different reasons, the Panel's
findings, in paragraphs 7.98 and 7.112 of the Pa nel Report, that Article 9(5) of the Basic AD
Regulation is inconsistent "as such" with Articles 6.10 and 9.2 of the Anti-Dumping Agreement,
because it conditions the determination of indivi dual dumping margins for and the imposition of
individual anti-dumping duties on NME exporters or produ cers to the fulfilment of the IT test. We

537If the level of co-operation is high, that is, if th e cooperating non-IT export ers account for close to
100 per cent of all exports, the export price will be based on a weighted average of the actual price of all export
transactions effected by these exporters.
538Panel Report, para. 7.50.

also find that the Panel did not act inconsistent ly with Article 11 of the DSU in finding that
Article 9(5) of the Basic AD Regulation is inconsis tent "as such" with Articles 6.10 and 9.2 of the
Anti-Dumping Agreement.
F. Article I:1 of the GATT 1994
386. The Panel considered that Article 9(5) of the Basic AD Regulation constitutes a rule or
formality, maintained by the European Union in connection with importation. According to the Panel,
Article 9(5) results in imports of the same product from different WTO Members being treated
differently in anti-dumping investigations. The Panel reasoned that imports from NMEs may be
treated differently from imports of like products from market economy countries only to the extent
that a relevant provision of the covered agreem ents allows for such differential treatment. 539 T h e
Panel found that the European Union had not demonstrated that any provision of the
Anti-Dumping Agreement, or any other provision of the WTO covered agreements, allows for the
specific different treatment of imports from NMEs that is provided for in Article 9(5) of the Basic AD
Regulation. Moreover, the Panel considered that the European Union had not established a sufficient
factual basis to conclude that there was a relevant difference in the nature of the imports concerned
from NMEs as compared to those from other WTO Memb ers, and stated that this argument by the
European Union was merely an assumption.
540
387. Regarding Article I:1 of the GATT 1994, the Panel therefore concluded:
[I]t is clear that the application of Article 9(5) will, in certain
situations, result in imports of the same product from different WTO
Members being treated differently in anti-dumping investigations
conducted by the European Union. Thus, we consider that
Article 9(5) violates the MFN obligation of Article I:1 of the
GATT 1994.
541
388. The European Union claims that the Panel erre d in the interpretation and the application of
Article I:1 of the GATT 1994, and acted inconsistently with Article 11 of the DSU, when it found that
Article 9(5) of the Basic AD Regulation is inconsis tent with the MFN obligation of Article I:1 of the
GATT 1994. The European Union contends that the alleged advantage granted to market economies
was based on the nature of the suppliers involved, and not on the product itself, and that this means
that discrimination between like products originati ng in different countries does not arise in this

539The Panel mentioned the second Ad Note to Article VI:1 of the GATT 1994 and Section 15 of
China's Accession Protocol as examples of relevant provisions allowing for differential treatment in respect of
the determination of normal value. (Panel Report, footnote 306 to para. 7.125)
540Panel Report, paras. 7.124 and 7.125.
541Panel Report, para. 7.124.

case.
542 The European Union argues that it is entitled to grant different treatment to imports from
market economies and from NMEs because such imports are different in nature. The European Union
adds that the word ''unconditionally'' in Article I: 1 does not preclude an advantage being subjected to
conditions as long as this does not result in de facto discrimination.543
389. China responds that the Panel properly found that Article 9(5) of the Basic AD Regulation is
inconsistent with Article I:1 of the GATT 1994, b ecause the different treatment that the European
Union provides in its anti-dumping investiga tions to imports from NME and non-NME WTO
Members "cannot be justified on the ground that the origin of the product somehow reflects a
difference in nature".544 China also submits that the Panel did not fail to comply with Article 11 of the
DSU and that it did not err in finding that the Anti-Dumping Agreement does not allow for the
different treatment of imports from NMEs provided for in Article 9(5) of the Basic AD Regulation.
390. Article I:1 of the GATT 1994 requires that:
[w]ith respect to customs duties a nd charges of any kind imposed on
or in connection with importati on or exportation or imposed on the
international transfer of payments for imports or exports, and with
respect to the method of levying such duties and charges, and with
respect to all rules and formalities in connection with importation and
exportation, and with respect to all matters referred to in paragraphs 2
and 4 of Article III, any advantage, favour, privilege or immunity
granted by any Member to any product originating in or destined for
any other country shall be accorded immediately and unconditionally
to the like product originating in or destined for the territories of all
other Members.
391. Article VI:2 of the GATT 1994 states that:
[i]n order to offset or prevent dumping, a Member may levy on any
dumped product an anti-dumping duty not greater in amount than the
margin of dumping in respect of such product. For the purposes of
this Article, the margin of dumping is the price difference determined
in accordance with the provisions of paragraph 1.

542European Union's appellant's submission, para. 213.
543European Union's appellant's submission, para. 212.

392. We observe that Article VI of the GATT 1994 permits the imposition of anti-dumping duties,
which may otherwise be inconsistent with othe r provisions of the GATT 1994, such as Article I:1. 545
Therefore, in our view, a preliminary question to be addressed before determining whether an anti-
dumping duty has been imposed inconsistently with Article I:1 of the GATT 1994 is whether the anti-
dumping duty had been imposed consistently with Article VI of the GATT 1994.
393. In Brazil – Desiccated Coconut , the Appellate Body upheld the panel's finding that the
applicability of Article VI of the GATT 1994 to a countervailing duty investigation also determined the
applicability of Articles I and II of the GATT 1994. The panel had found that Article VI of the
GATT 1994 did not apply to a c ountervailing duty measure that was the result of an investigation
initiated prior to 1 January 1995. Moreover, the panel had f ound that, if Article VI of GATT 1994
does not constitute applicable law, claims under Articles I and II, which derive from claims of
inconsistency with Article VI of the GATT 1994, cannot succeed.546
394. Article 9(5) of the Basic AD Regulation re gulates the conditions under which an anti-
dumping duty is to be imposed by the European Uni on. In its panel request, however, China did not
raise a claim under Article VI of the GATT 1994 in respect of Article 9(5) of the Basic AD
Regulation. Thus, it was not argued before the Pa nel and it is not disputed before us whether
Article 9(5) of the Basic AD Regulation is applied consistently with the provisions of Article VI of
the GATT 1994. This has significant implications fo r the question of whether Article 9(5) of the
Basic AD Regulation is inconsistent with Article I:1 of the GATT 1994.
395. The Panel, however, found that Article 9(5) of the Basic AD Regulation is inconsistent with
Article I:1 of the GATT 1994, without addressing the pr eliminary question that arises in this case of
whether Article 9(5) of the Basic AD Regulation w as consistent with Article VI of the GATT 1994.
The Panel did not engage with the implications of the absence of a claim under Article VI of the
GATT 1994 for a claim under Article I:1 of the GATT 1994. Nor did the Panel consider the
relationship between Article VI of th e GATT 1994 and the provisions of the Anti-Dumping
Agreement, which according to Article 1 of the Anti-Dumping Agreement "govern the application of

545This relationship is also reflected in Article II:2(b) of the GATT 1994, which states that:
Nothing in this Article shall prevent any Member 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.
546Appellate Body Report, Brazil – Desiccated Coconut, p. 21, DSR 1997:I, 167, at 185; Panel Report,
Brazil – Desiccated Coconut, paras. 280 and 281.

Article VI of the GATT 1994".
547 We thus consider that the Pane l's finding under Article I:1 of the
GATT 1994 lacks an essential step in the sequence of its legal analysis, that is, the determination of
whether and under what circumstances an anti-dum ping measure that is inconsistent with the
Anti-Dumping Agreement may be reviewed under Article I:1 of the GATT 1994 in the absence of a
review under Article VI of the GATT 1994.
396. As we explained above, China did not claim befo re the Panel that Article 9(5) of the Basic
AD Regulation is inconsistent with Article VI of the GATT 1994, nor did the parties present
arguments in this dispute in respect of th e relationship between the provisions of the Anti-Dumping
Agreement and those of Articles VI and I of the GATT 1994. Thus, we do not consider it appropriate
to explore further ourselves the implications of the absence of a claim under Article VI of the
GATT 1994 for a claim under Article I:1 of the GATT 1994.
397. In addition, we have already upheld the Panel' s findings that Article 9(5) of the Basic AD
Regulation is inconsistent "as such" with Articles 6.10 and 9.2 of the Anti-Dumping Agreement and
we consider that a ruling under Article I:1 of the GATT 1994 is unnecessary for purposes of resolving
this dispute.
398. Therefore, for the reasons given above, we d ecline to rule on the Panel's finding that
Article 9(5) of the Basic AD Regulation is inconsistent with Article I:1 of the GATT 1994 and declare
this finding moot and of no legal effect. We see no need to address the clai m by the European Union
that the Panel acted inconsistently with Article 11 of the DSU, because we have declared the Panel's
finding that Article 9(5) of the Basic AD Regulation is inconsistent with Article I:1 of the GATT 1994
moot and of no legal effect.
G. Article XVI:4 of the WTO Agreement an d Article 18.4 of the Anti-Dumping
Agreement
399. Article XVI:4 of the WTO Agreement requires WTO Members to ensure that their laws,
regulations, and administrative provisions are co nsistent with the provisions of the covered
agreements. Article 18.4 of the Anti-Dumping Agreement requires each Member to take all necessary
steps to ensure the conformity of its laws, re gulations, and administrative procedures with the

547Article 1 of the Anti-Dumping Agreement states that "[t]he following provisions govern the
application of Article VI of the GATT 1994 insofar as action is taken under anti-dumping legislation or
regulations." (emphasis added) We further note that Article 18.1 of the Anti-Dumping Agreement states that no
specific action against dumping "can be taken except in accordance with the provisions of GATT 1994, as
interpreted by this Agreement". The Panel did not analyze the implications of the terms "application" in
Article 1 and "as interpreted" in Article 18 of the Anti-Dumping Agreement with respect to the relationship
between the obligations in the Anti-Dumping Agreement and Articles VI and I of the GATT 1994.

provisions of the Anti-Dumping Agreement . Having concluded that Article 9(5) of the Basic AD
Regulation is inconsistent with Articles 6.10 and 9.2 of the Anti-Dumping Agreement "as such", the
Panel also found that:
… the European Union has acted inconsistently with Article XVI:4
of the WTO Agreement and Article 18.4 of the [ Anti-Dumping
Agreement] by failing to ensure the conformity of its laws,
regulations and administrative pro cedures with its obligations under
the relevant Agreements.548
400. As a consequence of the European Union's contention that the Panel wrongly found that
Article 9(5) of the Basic AD Regulation is inconsis tent "as such" with Articles 6.10 and 9.2 of the
Anti-Dumping Agreement, the European Union also requests the Appellate Body to reverse the Panel's
findings that the European Union acted in consistently with Article XVI:4 of the WTO Agreement and
Article 18.4 of the Anti-Dumping Agreement by failing to ensure the conformity of its laws,
regulations, and administrative procedures with its obligations under the relevant agreements.
401. We have upheld the Panel's findings that Ar ticle 9(5) of the Basic AD Regulation is
inconsistent with Articles 6.10 and 9.2 of the Anti-Dumping Agreement "as such". As a consequence,
we also uphold the Panel's finding, in paragraph 7. 137 of the Panel Report, that the European Union
has acted inconsistently with Article XVI:4 of the WTO Agreement and Article 18.4 of the
Anti-Dumping Agreement by failing to ensure the conformity of its laws, regulations, and
administrative procedures with its obligations under the relevant Agreements.
V. The Panel's Findings Regarding Article 9(5) of the Basic AD Regulation "As Applied"
in the Fasteners Investigation
402. The Panel considered that the fact that all th e requests for individual treatment were granted
to all Chinese producers or exporters that requested such treatment in the underlying investigation did
not preclude it from considering whether the application of Article 9(5) of the Basic AD Regulation in
the fasteners investigation was inconsistent with the Anti-Dumping Agreement. The Panel further
noted that the very existence of Article 9(5) of the Basic AD Regulation as part of the legal
framework that applies to anti-dumping investiga tions conducted by the European Union may have
discouraged other Chinese producers from coming forward and cooperating and from requesting
individual treatment in the investigation at issue.
549
403. Thus, having found that Article 9(5) of th e Basic AD Regulation is inconsistent with
Articles 6.10 and 9.2 of the Anti-Dumping Agreement "as such", the Panel considered that it was

548Panel Report, para. 7.137.
549Panel Report, footnote 334 to para. 7.148.

"difficult to see how its application in this inves tigation could be consider ed consistent with the
obligations of the European Union under the [ Anti-Dumping Agreement ]" and found that "for the
same reasons, its application in the fasteners investigation was also inconsistent with these
two provisions".
550
404. The European Union argues that, since the Panel erred in finding that Article 9(5) of the Basic
AD Regulation is inconsistent "as such" with the provisions of the Anti-Dumping Agreement , the
Appellate Body should also reverse the Panel' s "as applied" findings with respect to the
determinations made in the fasteners investigation. 551 Moreover, the European Union claims that the
Panel found that Article 9(5) "as such" prevents the result that suppliers from NMEs are entitled to
obtain from the European Union's compliance with the obligations contained in the Anti-Dumping
Agreement and the GATT 1994. However, in a case wh ere all companies requesting individual
treatment were granted such treatment, there is no basis for a finding of inconsistency "as applied"
because the result obtained by these companies w as the same as it would have been had the
European Union complied with its obligation. Accord ing to the European Union, for the Panel to say
that there is a possibility that Article 9(5) affected participation by Chinese exporters in the fasteners
investigation and/or the quality and quantity of information Chinese exporters provided to the
Commission is pure "speculation", and "not based on evidence".552
405. China submits that a measure that is found to be "as such" inconsistent with WTO obligations
will also necessarily be inconsistent "as applied". China argues that Article 9(5) of the Basic AD
Regulation not only prevents the result that suppliers from NMEs are entitled to obtain but also
subjects them to an additional burden by requiring such exporters to request and demonstrate that they
fulfil the conditions laid down in Article 9(5).553
406. We observe that in the fasteners investigation the European Union applied Article 9(5) of the
Basic AD Regulation. Those Chinese suppliers th at were not granted market economy treatment
under Article 2(7) of the Basic AD Regulation and requested individual treatment pursuant to
Article 9(5) obtained it, once they had demonstrated that they fulfilled each and every requirement of
the IT test. If Article 9(5) would not condition the granting of individual treatment on the fulfilment
of the IT test, all exporters from NMEs that are WTO Members would be entitled to individual
treatment, based on Articles 6.10 and 9.2 of the Anti-Dumping Agreement, regardless of whether they
qualify for market economy treatment under Article 2(7) or not. Article 9(5) of the Basic AD

550Panel Report, para. 7.148.
551European Union's appellant's submission, para. 228.
552European Union's appellant's submission, para. 231.

Regulation subjects the right of NME exporters to individual treatment to a number of conditions,
which are not provided for under Articles 6.10 and 9.2 of the Anti-Dumping Agreement as a
prerequisite for obtaining individual treatment. The fact that in this investigation all suppliers who
requested individual treatment under Article 9(5) met the burden of demonstrating that they fulfil all
the conditions set out in Article 9(5) does not, in our view, render this specific application of
Article 9(5) consistent with the Anti-Dumping Agreement.
407. We also disagree with the argument of the Eur opean Union that there are two categories of
measures that can be found "as such" inconsisten t: measures whose application will always produce
an inconsistent result and "measures where the re sult which is found WTO inconsistent may or may
not take place in an 'as applied' context depending on the configuration of facts". 554 In our view, any
instance of application of a measure that is "as such" inconsistent with a covered agreement will
produce an inconsistent result even in a situati on where suppliers succeed in demonstrating the
conditions of the IT test and qualify ultimately fo r individual treatment. In other words, granting
individual treatment without conditioning it on the fulf ilment of the IT test would be consistent "as
applied", while granting or denying individual treatment subject to the fulfilment of the IT test and the
administrative burden it imposes remain inconsistent "as applied".
408. Granting individual treatment subject to the fulf ilment of the IT test would produce a result
that may be less inconsistent than a complete deni al of individual treatment, but it would nevertheless
fall short of the requirements in Articles 6.10 and 9.2 of the Anti-Dumping Agreement . We see a
difference between the granting of individual treat ment without additional obstacles pursuant to
Articles 6.10 and 9.2 and the granting of individual tr eatment subject to a showing that the conditions
of the IT test have been fulfilled. The existence of the IT test itself, even where exporters succeed in
demonstrating that they meet its conditions, places an additional burden on those exporters who apply
for individual treatment, and it has a potential impact on those exporters who may be discouraged by
the administrative burden from cooperating with th e investigating authority and from requesting
individual treatment. The very existence of the IT test adversely affected Chinese exporters who were
concerned by the fasteners investigation. These expor ters bore the burden of demonstrating that they
were entitled to individual treatment, whereas under the Anti-Dumping Agreement no such
demonstration is required, and for this reason alone it is possible that some exporters did not apply for
individual treatment.
409. In the light of the above, having upheld the Pane l's findings that Article 9(5) of the Basic AD
Regulation is inconsistent "as such" with Articles 6.10 and 9.2 of the Anti-Dumping Agreement, we

554European Union's appellant's submission, para. 230.

also uphold the Panel's finding, in paragraph 7.148 of the Panel Report, that Article 9(5) of the Basic
AD Regulation is inconsistent with Articles 6.10 and 9.2 of the Anti-Dumping Agreement "as applied"
in the fasteners investigation.
VI. China's Other Appeal of the Panel's Findings under Articles 4.1 and 3.1 of the
Anti-Dumping Agreement
A. Introduction
410. We turn now to address China's other appeal of the Panel's findings that the European Union
did not act inconsistently with Articles 4.1 and 3.1 of the Anti-Dumping Agreement with respect to the
definition of the domestic industry in the fasteners investigation. We begin our analysis with the
interpretation of these provisions, in particular th e term "a major proportion" in Article 4.1 of the
Anti-Dumping Agreement . We then examine China's allegati on that the Panel erred in rejecting
China's claim that the domestic industry defined in the fasteners investigation did not include
producers whose collective output "constitutes a majo r proportion of the total domestic production"
within the meaning of Article 4.1 of the Anti-Dumping Agreement. Next, we address China's claims
that the Panel erred in finding that: (i) the European Union did not act inconsistently with Article 3.1
of the Anti-Dumping Agreement by making an injury determination on the basis of a sample of
producers that were not representative of the domestic industry; and (ii) the European Union did not
act inconsistently with Ar ticles 4.1 and 3.1 of the Anti-Dumping Agreement by excluding certain
producers from the definition of the domestic industry.
B. Interpretation of Articles 4.1 and 3.1 of the Anti-Dumping Agreement
411. Article 4.1 of the Anti-Dumping Agreement provides that the term "domestic industry" must
be defined as referring to the "domestic producers as a whole of the like product" or "those of them
whose collective output of the products constitutes a major proportion of the total domestic
production", except in two specific circumstance s that are not relevant in this dispute. 555 Article 4.1
thus juxtaposes two methods for defining the term "d omestic industry". By us ing the term "a major
proportion", the second method focuses on the question of how much production must be represented
by those producers making up the domestic industr y when the domestic industry is defined as less

555Emphasis added. Under Article 4.1(i), domestic producers that are relate d to the exporters or
importers or are themselves importers of the allegedly dumped product may be excluded. Article 4.1(ii) further
provides that the domestic industry may be limited to include only those producers within a particular
geographic region, if certain criteria are met.

than the domestic producers as a whole. In answeri ng this question, Article 4.1 does not stipulate a
specific proportion for evaluating whether a certain percentage constitutes "a major proportion".556
412. The absence of a specific proportion does not mean , however, that any percentage, no matter
how low, could automatically qualify as "a major pr oportion". Rather, the context in which the term
"a major proportion" is situated indicates that "a major proportion" should be properly understood as a
relatively high proportion of the total domestic produc tion. Specifically, when read in the light of the
phrase "the domestic producers as a whole", the term "those of them" in the second method for
defining the domestic industry clearly refers to those producers among "domestic producers as a
whole". Thus, the collective output of "those" pr oducers must be determined in relation to the
production of the domestic producers as a whole. Moreover, the term "a major proportion" is
immediately followed by the words "of the tota l domestic production". "A major proportion",
therefore, should be understood as a proportion defi ned by reference to the total production of
domestic producers as a whole. "A major proportion" of such total production will standardly serve
as a substantial reflection of the total domestic produ ction. Indeed, the lower the proportion, the more
sensitive an investigating authority will have to be to ensure that the proportion used substantially
reflects the total production of the producers as a whole.
413. In our view, the above interpretation is conf irmed by the purpose of defining the domestic
industry under the Anti-Dumping Agreement . As footnote 9 to Article 3 of the Anti-Dumping
Agreement indicates 557, the domestic industry forms the basis on which an investigating authority
makes the determination of whether the dumped import s cause or threaten to ca use material injury to
the domestic producers. In this respect, Article 3.1 requires that an injury determination be based on
"positive evidence". Pursuant to Article 3.4, su ch "positive evidence" includes relevant economic
factors and indices collected from the domestic industry, which have a bearing on the state of the
industry. Naturally, the "positive evidence" to be used in an injury determination requires
wide-ranging information concerning the relevant econom ic factors in order to ensure the accuracy of
an investigation concerning the st ate of the industry and the injury it has suffered. Thus, "a major
proportion of the total domestic production" should be determined so as to ensure that the domestic

556One panel has found that "Article 4.1 of the [Anti-Dumping] Agreement does not require Members to
define the 'domestic industry' in terms of domestic producers representing the majority, or 50+ per cent, of total
domestic production". (Panel Report, Argentina – Poultry Anti-Dumping Duties, para. 7.341)
557Footnote 9 states that:
Under this Agreement the term "injury" shall, unless otherwise specified, be
taken to mean material injury to a domestic industry, threat of material
injury to a domestic industry or material retardation of the establishment of
such an industry and shall be interp reted in accordance with the provisions
of [Article 3].

industry defined on this basis is capable of providi ng ample data that ensure an accurate injury
analysis.
414. Moreover, Article 3.1 requires that a determ ination of injury "involve an objective
examination" of, inter alia, the impact of the dumped imports on domestic producers. The Appellate
Body has found that an "objective examination" in accordance with Article 3.1 "requires that the
domestic industry, and the effects of dumped imports, be investigated in an unbiased manner, without
favouring the interests of any interested party, or group of interested parties, in the investigation".
558 In
other words, to ensure the accuracy of an injury determination, an investigating authority must not act
so as to give rise to a material risk of distor tion in defining the domestic industry, for example, by
excluding a whole category of producers of the like product. The risk of introducing distortion will
not arise when no producers are excluded and th e domestic industry is de fined as "the domestic
producers as a whole". Where a domestic industry is defined as those producers whose collective
output constitutes a major proportion of the total dom estic production, it follows that the higher the
proportion, the more producers will be included, and the less likely the injury determination
conducted on this basis would be distorted. Therefor e, the above interpretation is also consistent with
the requirement under Article 3.1 that an injury determination be based on an objective examination
of the impact of the dumped imports on domestic producers.
415. We recognize that obtaining information rega rding domestic producers may be difficult,
particularly in special market situations, such as a fragmented industry with numerous producers. In
such special cases, the use of "a major proportion" within the meaning of Article 4.1 provides an
investigating authority with some flexibility to defi ne the domestic industry in the light of what is
reasonable and practically possible. The practical constraint on an authority's ability to obtain
information regarding the domestic producers may al so mean that, in such special cases, what
constitutes "a major proportion of the total domestic pr oduction" may be lower than what is ordinarily
permissible in a less fragmented market.
416. Nonetheless, while the proportion of total produc tion that qualifies as "a major proportion" in
such a special market situation may be lower than in a normal case, this does not change the purpose
of defining the domestic industry, that is, to provide the basis for the injury determination. As in a
normal case, the domestic industry defined in such a sp ecial case also must ensure that the subsequent
injury analysis is based on positive evidence a nd involves an objective examination pursuant to
Article 3.1 of the Anti-Dumping Agreement. An injury determination regarding a fragmented industry
must therefore cover a large enough proportion of to tal domestic production to ensure that a proper

558Appellate Body Report, US – Hot-Rolled Steel, para. 193.

injury determination can be made pursuant to Article 3.1. Thus, even if what constitutes "a major
proportion" may be lower in the light of the practical constraints on obtaining information in a special
market situation, an investigating authority bears the obligation to ensure that the way in which it
defines the domestic industry does not introduce a ma terial risk of skewing the economic data and,
consequently, distorting its analysis of the state of the industry.
417. Finally, we turn to examine the interpreta tion advanced by the European Union that
Article 5.4 of the Anti-Dumping Agreement provides important contextual guidance concerning the
interpretation of the term "a major proportion" in Ar ticle 4.1 of that Agreement. Article 5.4, which
contains the standing requirement for the initiation of an investigation, provides certain numerical
benchmarks for evaluating whether a complaint to initiate an anti-dumping investigation has sufficient
support by domestic producers. Specifically, Article 5.4 states that an investigation "shall not be
initiated" unless the application "has been made by or on behalf of the domestic industry ".559 It then
provides that "[t]he application shall be considered to have been made 'by or on behalf of the domestic
industry' if it is supported by those domestic producers whose collective output constitutes more
than 50 per cent of the total production of the like product produced by that portion of the domestic
industry expressing either support or opposition to the application." Furthermore, "no investigation
shall be initiated when domestic producers expres sly supporting the application account for less
than 25 per cent of total production of the like product produced by the domestic industry."
418. According to the European Union, it is "permissible to consid er that producers that represent
25% or more of domestic production can legitimately represent a major proportion of total
production".560 In our view, however, there is no textua l basis for such a proposition. Articles 4.1
and 5.4 concern two different aspects of an anti-dumpi ng investigation. Article 4.1 defines the whole
universe of the domestic industry relevant to th e injury determination in an anti-dumping
investigation. By contrast, Article 5.4 concerns th e question of whether an application is made "by or
on behalf of the domestic industry", and requir es a minimum benchmark defined as expressions of
support from those producers representing at least 25 per cent of the "total production … by the
domestic industry".
561 Therefore, the 25 per cent benchmark under Article 5.4 does not address the
question of how the entire universe of the domestic industry itself should be defined. The
European Union's recourse to the negotiating history regarding Articles 4.1 and 5.4 of the
Anti-Dumping Agreement is also unavailing. Although the European Union asserts that the
"discussions on major proportion and standing went hand in hand" during the negotiations, this does

559Emphasis added.
560European Union's appellee's submission, para. 187. (original emphasis)
561Emphasis added.

not change the fact that no agreement was reach ed in setting a specific proportion for determining
what, in abstract, constitutes "a major proportion".
562
419. In sum, a proper interpretation of the term "a major proportion" under Article 4.1 requires that
the domestic industry defined on this basis encomp ass producers whose collective output represents a
relatively high proportion that substantially reflects the total domestic production. This ensures that
the injury determination is based on wide-ranging information regarding domestic producers and is
not distorted or skewed. In the special case of a fragmented industry with numerous producers, the
practical constraints on an authority's ability to ob tain information may mean that what constitutes
"a major proportion" may be lower than what is or dinarily permissible in a less fragmented industry.
However, even in such cases, the authority bears the same obligati on to ensure that the process of
defining the domestic industry does not give rise to a material risk of distortion. A complainant
alleging an inconsistency under the second method for defining the domestic industry bears the
burden to prove its claim and to demonstrate that the domestic industry definition does not meet the
standard of "a major proportion". Nonetheless, a domestic industry defined on the basis of a
proportion that is low, or defined through a process that involves active exclusion of certain domestic
producers, is likely to be more susceptible to a finding of inconsistency u nder Article 4.1 of the
Anti-Dumping Agreement.
C. Whether 27 Per Cent of Total Domestic Production in the Fasteners Investigation
Constitutes "a major proportion" within the Meaning of Article 4.1 of the
Anti-Dumping Agreement
420. China appeals the Panel's finding that China did not establish that the domestic industry
defined in the fasteners investigation did not include domestic producers whose collective output
constituted a "major proportion" of the total domestic production. According to China, the Panel
erroneously concluded that the fact that the Commission relied on a presumption that 25 per cent of
total domestic production constituted "a major proportion" within the meaning of Article 4.1 of the
Anti-Dumping Agreement was insufficient to demonstrate that the definition of the domestic industry
in this dispute was inconsistent with Article 4.1. Moreover, China alleges that the Panel erroneously
concluded that certain specific circumstances in the fasteners investigation, such as the possibility of
including more producers in the domestic i ndustry definition than were included by the

562European Union's appellee's submission, para. 184.

Commission563, were not relevant to the examination of whether the domestic industry defined by the
Commission met the requirement of "a major proportion" under Article 4.1.
421. We recall that, with regard to the definitio n of the domestic industry in the fasteners
investigation, recital 114 of the Definitive Regulation provided that:
[t]he production of the Community producers that supported the
complaint and fully cooperated in the investigation represents 27,0%
of the production of the product concerned in the Community. It is
therefore considered that these companies constitute the Community
industry within the meaning of Articles 4(1) and 5(4) of the basic
Regulation.
564 (emphasis added)
422. As the European Union acknowledges 565, in relation to the total domestic production,
27 per cent is at the lower end of the spectrum. Indeed, a figure as low as 27 per cent can hardly be
considered a substantial reflection of the total. Nonetheless, the European Union alleges that the
fasteners industry is "known to be" a fragmented industry with many producers 566, and China does not
dispute this. The practical constraints on obtaini ng information from domestic producers in such a
market may mean that what normally would not qualify as "a major proportion" may in these
circumstances suffice, provided that the process of defining the domestic industry does not introduce
material risks of distortion. Nonetheless, as furt her discussed below, the Commission failed to ensure
that the domestic industry definition would not introdu ce a material risk of distortion to the injury
analysis by relying on a minimum benchmark irrele vant to the issue of what constitutes "a major
proportion", and by excluding certain known produ cers on the basis of a self-selection process among
the producers.
423. The evidence on the record shows that, in the fasteners investigation, the Commission applied
a minimum benchmark of 25 per cent in defining th e domestic industry. As the European Union

563See China's other appellant's submission, paras. 250-254. Other specific circumstances alleged by
China include: (i) whether the producers included in the domestic industry definition were representative of the
entire EU industry; and (ii) the fact that the number of producers included in the domestic industry definition
(45) was much smaller than the total number of known EU producers (318). (See ibid., paras. 247-249 and
255-258)
564Definitive Regulation, supra, footnote 4, recital 114.
565European Union's responses to questioning at the oral hearing.
566European Union's appellee's submission, para. 1 91. See also European Union's second written

explains, Articles 4(1) and 5(4) of the Basic AD Regulation
567, which "link[] the 'major proportion'
requirement to the objective benchmark of Article 5.4 of the Anti-Dumping Agreement as a legitimate
presumption"568, reflect its position that producers that represent 25 per cent or more of domestic
production represent a major proportion of total pr oduction. We recall that recital 114 of the
Definitive Regulation provides that the producers whose output represents 27 per cent of the total
domestic production constitutes the do mestic industry "within the meaning of Articles 4(1) and 5(4)"
of the Basic AD Regulation. This indicates th at the Commission considered that producers
representing 27 per cent of the total domestic produ ction were sufficient to constitute the domestic
industry simply because they fulfilled the 25 per cent test set out in Articles 4(1) and 5(4) of the Basic
AD Regulation. The European Union confirms this understanding in stating that it is "permissible to
consider that producers that represent 25% or more of domestic production can legitimately represent
a major proportion of total production and … this was the case in the fasteners investigation."
569
424. We note that China has not challenged Articles 4(1) and 5(4) of the Basic AD Regulation, as
such, and that the meaning and scope of these prov isions were not examined by the Panel. These
provisions are therefore not before us. Noneth eless, China challenges the application of these
provisions in the fasteners investigation, arguing that the Commission was not permitted to apply a
minimum benchmark, but was required to examine the specific circumstances to determine whether
the standard of "a major proportion" was met.570
425. The Definitive Regulation indicates, and the Eu ropean Union confirms, that the Commission
applied the 25 per cent test under Articles 4(1) an d 5(4) of the Basic AD Regulation in the fasteners
investigation and concluded that the producer s representing 27 per cent of the total domestic
production constituted the domestic i ndustry. However, as explaine d above, we disagree with the
European Union's position that 25 per cent of tota l domestic production can be presumed to meet the
requirement of "a major proportion" under Article 4.1 of the Anti-Dumping Agreement. In our view,
the 25 per cent benchmark in Article 5.4 of the Anti-Dumping Agreement concerns the issue of
standing and does not address the question of what c onstitutes "a major proporti on" in Article 4.1.
Thus, the Commission determined that a proportion as small as 27 per cent met the standard of "a

567Specifically, Article 4(1) of the Basic AD Regulation states that "the term 'Community industry'
shall be interpreted as referring to the Community producers as a whole of the like products or to those of them
whose collective output of the products constitutes a major proportion, as defined in Article 5(4) , of the total
Community production of those products". (Basic AD Regulation, supra, footnote 5, Article 4(1) (emphasis
added)) Article 5(4) of the Basic AD Regulation, in turn, transcribes the standing requirement provided in
Article 5.4 of the Anti-Dumping Agreement, including the minimum benchmark of "25% of total production of
the like product produced by the Community industry". (Ibid., Article 5(4))
568European Union's appellee's submission, para. 186.
569European Union's appellee's submission, para. 187. (original emphasis) See also European Union's
570See China's other appellant's submission, paras. 223-243.

major proportion" simply because it exceeded a benchm ark that was irrelevant to the issue of the
definition of the domestic industry. As a result of the application of a benchmark wholly unrelated to
the proper interpretation of the term "a major proportion", the domestic industry defined in the
fasteners investigation covered a low proportion of domestic production, which significantly restricted
the data coverage for conducting an accurate and undistorted injury determination.
426. Moreover, as noted above, recital 114 of th e Definitive Regulation defines the domestic
industry as including "the Community producers that supported the complaint and fully cooperated in
the investigation". We note that the issue of whether the domestic industry, as defined, included only
those "producers that supported the complaint" is disputed between the parties, and we will address
that issue in the next subsection. It is not disputed, however, that the Commission limited the
definition of the domestic industry to those producers who "fully cooperated in the investigation". In
this respect, the Definitive Regulation provides that:
… in view of the large number of producers, sampling of the
domestic industry was proposed. ... In order to enable the
Commission to decide whether sampling would be necessary, and if
so to select a sample, Community pr oducers were requested to make
themselves known within 15 days from the date of the initiation of
the investigation and to provide basic information on their production
and sales, and the names and activitie s of all their related companies
involved in the production and/or selling of the product concerned …
46 Community producers that produced the product concerned in the
Community during the investigation period and expressed a wish to
be included in the sample with in the aforesaid period were
considered as cooperating companies and were taken into account in
the selection of the sample ... These Community producers
represented over 30% of the estimated production in the Community
in 2006. These producers are considered to constitute the
Community industry as mentioned in recital 114.
571 (emphasis added)
427. In our view, by defining the domestic industry on the basis of willingness to be included in
the sample, the Commission's approach impo sed a self-selection process among the domestic
producers that introduced a material risk of distortion. First, we fail to see the reason why a
producer's willingness to be included in the sample should affect its eligibility to be included in the
domestic industry, which is a universe of producers that is by definition wider than the sample. As
China argues on appeal, the Commission's approach "confuses two different steps", because the

571Panel Report, para. 7.212 (quoting Definitive Regulation, supra, footnote 4, recitals 23-25). As
noted above, one producer among the 46 cooperating producers was later found not to be cooperating and was
dropped from the definition of the domestic industry, reducing the proportion of the total domestic production
represented by the domestic industry to 27 per cent.

domestic industry should be define d first, before a sample may be selected from the producers
included in the domestic industry.
572
428. We note that the Panel expressed "sympathy for the European Union's view that producers
who do not support the complaint are not likely to cooperate, and thus cannot effectively be
considered as part of the dom estic industry unless they specifically come forward and agree to
participate in the investigation." 573 However, the evidence on th e record shows more producers
"specifically [came] forward"574 than were ultimately included in the domestic industry definition. As
the European Union explained before the Pane l, the Commission contacted 318 known producers
requesting certain basic information, and 70 companies responded by providing the requested
information within the 15-day deadline, including information on their production and sales. 575 Thus,
as China submits, the Commission identified, and ob tained information from, more producers than
those it ultimately included in the domestic industry definition.576
429. According to the European Union's explan ation, the Commission excluded 25 of these
70 producers from the domestic industry definiti on for various reasons, one of which was the
producers' expressed unwillingness to be part of the sample. 577 However, as noted above, the sample
of domestic producers is a smaller universe than the domestic industry, and the unwillingness to be
part of the sample should not affect whether a producer should be part of the domestic industry. This
is confirmed by the relevant facts in the fast eners investigation. Specifically, the Commission

572China's other appellant's submission, para. 163.
573Panel Report, para. 7.215. Although we also r ecognize the potential difficulty in obtaining
information from non-cooperating companies, we note that the Commission was not entirely without any ability
to solicit information. Article 6(3) of the Basic AD Regulation, for instance, provides that "[t]he Commission
may request Member States to supply information, and Member States shall take whatever steps are necessary in
order to give effect to such requests." Article 6(4) further provides that "[t]he Commission may request
Member States to carry out all necessary checks and inspections, particularly amongst importers, traders and
Community producers, and to carry out investigations in third countries, provided that the firms concerned give
their consent and that the government of the country in question has been officially notified and raises no
objection."
574Panel Report, para. 7.215.
575Upon the Panel's request, the European Union provided the list of the 70 EU producers, including the
names of the related companies involved in the production and/or selling of th e product concerned. (See List of
"Sampling Form for Community Producers" for inspection by interested parties (Panel Exhibit EU-19))
576China alleges on appeal that 114 producers, whose output represented 45 per cent of total domestic
production, came forward and provided relevant information. China also alleges that the Commission could
have included these 114 producers in the domestic industry definition. (See China's other appellant's submission,
paras. 253 and 254) This is a factual issue disputed between the parties and on which we make no finding.
Section VI.E of this Report contains our detailed analysis of the participants' dispute on appeal concerning
certain factual issues before the Panel.
577The European Union explained before the Panel that the Commission disregarded 25 of the
70 producers who responded because they: (i) did not produce the product concerned; (ii) did not wish to be
included in the sample; or (iii) refused to provide, or did not send, an open version of their reply. (See European
Union's response to Panel Question 31, para. 93) We found no evidence on the record regarding how many of
these producers were excluded for the sole reason that they were unwilling to be included in the sample.

selected six producers as part of the sample, obtained relevant information from them, and verified the
information on their premises. 578 The Commission then used the information obtained from the
sampled producers for its analysis of the "microeconomic" injury factors, but conducted its analysis of
the "macroeconomic" injury factors on the basis of information obtained from all of the 45 producers
included in the domestic industry definition.579 Thus, by including only those willing to be part of the
sample in the domestic industry definition, the Co mmission's approach shrank the universe of
producers whose data could have been used for part of the injury determination. Even though, due to
the fragmented nature of the fasteners industry, the practical constraints on obtaining information may
justify the inclusion of a smaller proportion of domestic production in the domestic industry
definition, the Commission's approach in excluding those who provided relevant information but were
unwilling to be part of the sample was unrelated to, and cannot be justified by, such practical
constraints.
430. In sum, in the fasteners inves tigation, the collective output of those producers included in the
domestic industry definition, which accounted fo r 27 per cent of the total domestic production,
represented a low proportion in relation to the total. The fragmented nature of the fasteners industry,
however, might have permitted such a low proporti on due to the impracticality of obtaining more
information, provided that the process with which the Commission defined the industry did not give
rise to a material risk of distortion. Yet, we note that the Commission applied a minimum benchmark
of 25 per cent in defining what constituted "a ma jor proportion of total domestic production", even
though this benchmark does not address the standard of "a major proportion" or the practicality of
achieving a higher proportion. Moreover, by limiti ng the domestic industry definition to those
producers willing to be part of the sample, the Co mmission excluded producers that provided relevant
information. In so doing, the Commission reduced the data coverage that could have served as a basis
for its injury analysis and introduced a material risk of distorting the injury determination. Therefore,
we consider that the Panel erred in finding that "t he European Union did not act inconsistently with
Article 4.1 of the [ Anti-Dumping Agreement ] in defining a domestic industry comprising producers
accounting for 27 per cent of total estimated EU production of fasteners."580

578See Definitive Regulation, supra, footnote 4, recitals 27, 28, 36, and 37.
579The "microeconomic" factors were stocks, prof itability and cash flow, investment, return on
investments, ability to raise capital, and wages. Th e "macroeconomic" factors were production, production
capacity, capacity utilisation, sales, market share, average prices, employment, and productivity. (See Panel
Report, para. 7.385)
580Panel Report, para. 7.230.

D. The Consistency of the Sample with Article 3.1 of the Anti-Dumping Agreement
431. China alleges that the Panel erred in rejecti ng its claim that the European Union violated
Article 3.1 of the Anti-Dumping Agreement because the Commission made an injury determination
with respect to a sample of producers that was not representative.
581 China argued before the Panel
that, even assuming that the domestic industry was correctly defined, the sample selected by the
Commission for purposes of the injury determina tion was inconsistent w ith Article 3.1 of the
Anti-Dumping Agreement because it was not representative of th e domestic industry. According to
China, the sample was selected on the sole basis of production vo lume of the like product rather than
on the basis of a statistically valid sample. 582 China also argued that the Commission could have
carried out the examination of all injury factors with respect to the entire domestic industry it had
defined, or at least with respect to more producers than those included in the sample. 583
432. The Panel rejected these arguments. The Panel found that, "in the absence of any arguments
concerning relevant factors either ignored or dismis sed by the investigating authority, and given that
the sample selected does appear to include producers whose production is representative of that of the
industry defined in the investigation, … China has not demonstrated that the sample selected is not
representative of the domestic industry solely because it was selected on the basis of volume of
production."584 Moreover, the Panel stated that it " cannot accept the contention that only a
statistically valid sample will be sufficien tly representative for purposes of an injury
determination".585 The Panel also found that the fact th at the Commission examined certain injury
factors with respect to the entire domestic industry did not, as China contended, demonstrate that the
Commission could have carried out its examination of all injury factors with respect to the entire
domestic industry it had defined, or could have at least included more producers in the sample. On
appeal, China claims that the Panel erred in its in terpretation and application of Article 3.1 of the
Anti-Dumping Agreement in reaching these findings.586
433. As a preliminary matter, we note the European Union's assertion that China's appeal concerns
a claim that was not included in China's panel re quest and therefore is not properly before the
Appellate Body.587 According to the European Union, China's claim that the European Union violated
Article 3.1 of the Anti-Dumping Agreement by failing to use a sampling technique that guarantees that

581China's other appellant's submission, paras. 267 and 278.
582See Panel Report, para. 7.237.
583See Panel Report, para. 7.240.
584Panel Report, para. 7.238.
585Panel Report, para. 7.239.
586See China's other appellant's submission, para. 267.
587European Union's appellee's submission, para. 213.

the sample is sufficiently representative of the dom estic industry was "suddenly" raised at the second
substantive meeting before the Panel and constitutes a new claim not included in the request for
consultations or for Panel establishment.588
434. In its panel request, China claimed that the European Union violated Article 3.1 of the
Anti-Dumping Agreement by conducting the injury determination on the basis of a sample of
producers accounting for only 17.5 per cent of the total domestic production. 589 China's claim in its
panel request thus alerted the European Union to th e fact that China consid ered that the sample was
deficient for conducting a proper injury analysis, at l east in terms of the volume of production. Thus,
like the Panel, we consider that China merely de veloped a new argument in support of its claim under
Article 3.1 of the Anti-Dumping Agreement when alleging that the selected sample was also not
representative of the domestic industry. Therefore, we agree with the Panel's finding that China's
argument did not constitute an entirely new claim, as alleged by the European Union, but was rather a
newly developed argument in support of China's cl aim that the European Union "failed to make a
determination of injury with respect to the rele vant domestic industry, in part because the sample
included producers accounting for only 17.5 per cent of domestic production".590
435. Turning to the substance of China's claims, we note that the Anti-Dumping Agreement is
silent on the issue of whether sampling may be used for purposes of the injury determination. The
Agreement thus does not prevent an authority from using samples to determine injury, and China does
not contest this view. 591 In the fasteners investigation, the Commission selected a sample
comprising six producers, whose output accounted fo r approximately 65 per cent of the production of
the 45 domestic producers defined by the Commissi on as the domestic industry. The Commission
chose these producers on the basis of their produ ction volumes, "so as to achieve the largest
representative volume of production of the like pr oduct produced in the Community which could
reasonably be investigated within the time available". 592 China submits that a sample that is selected
merely on the basis of the "largest volume that can reasonably be investigated" is not appropriate to
satisfy the requirement under Article 3.1 of the Anti-Dumping Agreement that an injury determination
involve an objective examination of the effects of the dumped imports, because such a sample is not

588European Union's appellee's submission, para. 214. The European Union raised the same objection
before the Panel. (See Panel Report, footnote 509 to para. 7.237)
589WT/DS397/3, para. (ii)(k)(iv).
590Panel Report, footnote 509 to para. 7.237.
591See Panel Report, para. 7.239.
592Panel Report, para. 7.216 (quoting Definitive Regulation, supra, footnote 4, recital 27).

representative of the domestic industry.
593 Rather, China argues, other methods, such as a statistically
valid sample, should be used.
436. We note that, because the Anti-Dumping Agreement does not specify whether sampling is
allowed for purposes of an injury determination, it also does not contain guidance on how sampling
should be conducted. Thus, we see no basis for China's argument that a sample selected on the basis
of the largest volume that can reasonably be invest igated, rather than a statistically valid sample,
necessarily means that an injury determination conduct ed on this basis is inconsistent with Article 3.1
of the Anti-Dumping Agreement. Although we do not disagree with the view that a sample must be
properly representative of the domestic industry define d by the investigating authority, we disagree
with China's contention that the only way to ensu re representativeness is through a statistically valid
sample. In our view, as long as the domestic industry is defined consistently with the Anti-Dumping
Agreement, and that the sample selected is representative of the domestic industry, an investigating
authority has discretion in deciding the method with which it selects a sample. A statistically valid
sample is a proper way to ensure the representativeness of the sample. Yet, the Anti-Dumping
Agreement imposes no obligation on an investigating author ity always to resort to statistically valid
samples.
437. China further argues that, as it demonstrated to the Panel, the Commission conducted its
analysis of the "macroeconomic" injury factor s on the basis of the information from all of
the 45 producers included in the domestic industry de finition. China therefore asserts that, if the
Commission was in a position to analyze the macroe conomic injury factors for the domestic industry
as defined, it could also have analyzed the "mic roeconomic" injury factors for the domestic industry
as defined rather than only for the sampled domestic producers. However, as the Panel correctly
found, China has not provided any arguments or evidence to substantiate its assertion.594
438. On this basis, we decline to uphold China's claims that the Panel erred in rejecting the
contention that only a statistically valid sample w ould be sufficiently representative of the domestic
industry, and in finding that China had not demons trated that the Commission could have carried out
its entire injury examination for the domestic industr y it had defined, or coul d have at least included
more producers in the sample. We note that China' s above claims concern the issue of whether the
sample itself selected in the investigation was consistent with Article 3.1 of the Anti-Dumping
Agreement. In declining to uphold China's claim, ther efore, our finding is limited to the issue of

593China's other appellant's submission, para. 271.
594Moreover, we note that China has not appealed the Panel's finding that the European Union did not
act inconsistently with Articles 3.1 and 3.4 of the Anti-Dumping Agreement by basing its examination of
"microeconomic" injury factors on the sampled producers. (See Panel Report, para. 7.395)

whether the sample was inconsistent with Article 3.1 of the Anti-Dumping Agreement, and does not
address the issue of whether the domestic industry defined by the Commission in the fasteners
investigation was consistent with this provision.
E. Exclusion of Certain Producers
1. The Exclusion of Producers Who Did Not Support the Complaint
439. China claims that, in finding that the Eur opean Union did not act inconsistently with
Article 4.1 of the Anti-Dumping Agreement, the Panel failed to conduct an objective assessment of the
facts, as required by Article 11 of the DSU and Article 17.6 595 of the Anti-Dumping Agreement , in
finding that the European Union did not exclud e from the definition of domestic industry those
producers who did not support the complaint lodged against imports of fasteners from China.
Specifically, China claims that the Panel: (i) "disregarded" 596 certain evidence submitted by China,
that is, the Information Document 597 issued by the Commission during the investigation, and a letter
sent by the Commission; (ii) accepted an "unsubstantiated" 598 factual assertion by the
European Union that at least one producer included in the domestic industry definition did not support
the investigation; and (iii) drew an incorrect inference from that factual assertion.
440. Article 11 of the DSU states, in relevant part, that:
… a panel should make an objective assessment of the matter before
it, including an objective assessment of the facts of the case and the
applicability of and conformity with the relevant covered agreements,
and make such other findings as will assist the DSB in making the
recommendations or in giving the rulings provided for in the covered
agreements.
441. Pursuant to Article 11 of the DSU, a panel, as a trier of facts, must base its findings on a
sufficient evidentiary basis on the record
599, may not apply a double standard of proof 600, and its

595China did not provide any arguments specifically regarding Article 17.6 of the Anti-Dumping
Agreement in support of its claim under Article 4.1 of that Agreement. Moreover, we recall that the Appellate
Body has found that "it is inconceivable that Article 17.6(i) should require anything other than that panels make
an objective 'assessment of the facts of the matter'." (Appellate Body Report, US – Hot Rolled Steel , para. 55
(original emphasis)) In the light of these findings, and the absence of arguments by China concerning
Article 17.6 of the Anti-Dumping Agreement, we do not separately address, in our analysis, China's claim under
this provision.
596China's other appellant's submission, p. 47, heading (F).
597European Commission, Anti-dumping proceeding co ncerning imports of certain iron or steel
fasteners originating in the People's Republic of Chin a, Non-imposition of provisio nal anti-dumping measures,
4 August 2008 (Panel Exhibit CHN-17).
598China's other appellant's submission, p. 38, heading (D).
599See Appellate Body Report, US – Continued Zeroing, para. 338.
600See Appellate Body Report, Korea – Dairy, para. 137.

treatment of the evidence mu st not "lack even-handedness".
601 Moreover, the duty to make an
objective assessment of the facts of the case "requir es a panel to consider evidence before it in its
totality, which includes consideration of s ubmitted evidence in relation to other evidence" 602, and a
panel should not disregard evidence that is relevant to the case of one of the parties. 603 The Appellate
Body has also clarified, however, that a panel is "entitled, in the exercise of its discretion, to
determine that certain elements of evidence should be accorded more weight than other elements". 604
In doing so, a panel "is not required to discuss, in its report, each and every piece of evidence." 605
Moreover, "in view of the distinction between the re spective roles of the Appellate Body and panels",
the Appellate Body will not "interfere light ly" with the panel's fact-finding authority 606, and "cannot
base a finding of inconsistency under Article 11 simply on the conclusion that [it] might have reached
a different factual finding from the one the panel reached".607
442. Thus, not every error allegedly committed by a panel amounts to a violation of Article 11 of
the DSU. It is incumbent on a participant rais ing a claim under Article 11 on appeal to explain why
the alleged error meets the standard of review under that provision. An attempt to make every error of
a panel a violation of Article 11 of the DSU is an appr oach that is inconsistent with the scope of this
provision. In particular, when alleging that a pane l ignored a piece of evidence, the mere fact that a
panel did not explicitly refer to that evidence in its reasoning is insufficient to support a claim of
violation under Article 11. Rather, a participant must explain why such evidence is so material to its
case that the panel's failure explicitly to address a nd rely upon the evidence has a bearing on the
objectivity of the panel's factual assessment. It is also unacceptable for a pa rticipant effectively to
recast its arguments before the panel under the guise of an Article 11 claim. Instead, a participant
must identify specific errors regarding the objectivity of the panel's assessment. Finally, a claim that a
panel failed to comply with its duties under Article 11 of the DSU must stand by itself and should not
be made merely as a subsidiary argument or claim in support of a claim that the panel failed to apply
correctly a provision of the covered agreements.
608 With these considerations in mind, we turn to
review China's appeal against the Panel's finding regarding the alleged exclusion of certain producers
from the definition of the domestic industry.

601Appellate Body Report, US – Upland Cotton (Article 21.5 – Brazil), para. 292.
602Appellate Body Report, US – Continued Zeroing, para. 331.
603Appellate Body Reports, US/Canada – Continued Suspension, paras. 553 and 615.
605Appellate Body Report, Brazil – Retreaded Tyres, para. 202.
606See Appellate Body Report, US – Wheat Gluten, para. 151; Appellate Body Report, EC – Sardines,
607Appellate Body Report, US – Wheat Gluten, para. 151.
608See Appellate Body Report, US – Steel Safeguards , para. 498; and Appellate Body Report, Chile –
Price Band System (Article 21.5 – Argentina), para. 238.

443. The Panel noted the European Union's explan ation that, at the time of initiation, the
Commission sent sampling forms to 318 EU producer s of fasteners, requesting them to provide
certain information within 15 days, and to indicate whether they would be willing to be included in
the sample.609 The Panel also noted that the sampling forms do not contain any questions concerning
whether the producers supported or opposed the application. 610 On the basis of the sampling forms
received, the Commission defined the domestic industry in the fasteners investigation as
including 45 EU producers, representing 27 per cent of the total EU production, all of whom
responded to the request for information within the 15-day deadline and indicated that they would be
willing to be part of the sample. 611 According to recital 114 of the Definitive Regulation, these
EU producers "supported the complaint and fully cooperated in the investigation". 612 T h e
European Union explained that, despite the stipulati on in recital 114, the issue of support was in fact
only relevant to the determination of whether the complaint for the initiation of the fasteners
investigation had met the standing requirement. The sampling forms sent for purposes of defining the
domestic industry did not concern the issue of st anding. Rather, they concerned the issue of
cooperation, that is, whether a producer would be willing to be part of the sample.613
444. In the Panel's view, "by using the term 'p roducers that supported the complaint'", the
Definitive Regulation "suggest[ed]" that only pro ducers expressing support for the complaint were
included in the domestic industry. 614 Notwithstanding recital 114 of the Definitive Regulation, the
Panel did not immediately reach a finding that produc ers not supporting the complaint were excluded.
Rather, the Panel went on to review several other pieces of evidence as well as the parties' relevant
arguments. The Panel noted China's contention that the Commission was aware of the positions of
the EU producers with regard to the investigati on and defined the domestic industry on the basis of
the producers' support for the investigation. Accord ing to China, the Information Document, sent to
the parties at the time the Commission decided not to issue a provisional measure 615, indicates that, of
the 114 domestic producers who came forward with re levant information, 86, representing 36 per cent

609Panel Report, para. 7.213 (referring to European Union's response to Panel Question 88, para. 17).
610Panel Report, para. 7.213 (referring to Non-conf idential Sampling Form of Agrati (Panel Exhibit
EU-30) and Non-confidential Sampling Form of Fontana Luigi (Panel Exhibit EU-31)).
611Panel Report, paras. 7.212 (referring to Definitive Regulation, supra, footnote 4, recitals 22-25)
and 7.216.
612Panel Report, para. 7.212 (quoting Definitive Regulation, supra, footnote 4, recital 114).
613See European Union's response to Panel Question 31, para. 97; and European Union's response to
Panel Question 89, para. 18.
614Panel Report, para. 7.214 (referring to European Union's response to Panel Question 30, para. 88).
615Definitive Regulation, supra, footnote 4, recital 5; Information Document , supra, footnote 81.

of estimated EU production, supported the compla int, while 25, accounting for 9 per cent of EU
production, opposed the complaint, and three did not express an opinion.
616
445. The Panel did not rely on the Information Document, but accepted the European Union's
contention that the Information Document was "a working document reflecting progress in the
investigation to that point, with no legal status in EU law, which was made available to the parties
despite there being no obligation to do so, and is not the measure before us".
617 Therefore, the Panel
"[did] not consider the representations in the In formation Document as constituting part of the
measure which [it] must evaluate." 618 Moreover, the Panel noted the European Union's explanations
that:
… based on arguments made by Chinese exporters, it continued to
consider the question of standing after the initiation, that this
continued examination confused the question of the definition of the
domestic industry, and that the "unfortunate standard formulation" in
the Definitive Regulation (referring to the use of the term "producers
that supported the complaint" w ith respect to the domestic industry) ,
did not affect the definition of the domestic industry, with respect to
which no distinction was made between producers who supported the
complaint and those that did not.
619 (emphasis added; footnotes
omitted)
446. The European Union further explained before th e Panel that revisiting the issue of standing
was a "mistake" because it caused "confusion" 620, as demonstrated by certain inaccuracies in the
Information Document. Specifically, the Europ ean Union submitted that 70 companies (rather
than 114 companies indicated in the Information Document) came forward after initiation and
provided the information requested in the No tice of Initiation within the 15-day deadline. 621 Only 46
of these 70 producers were considered as cooperati ng and were included in the domestic industry
definition, as confirmed by recital 25 of the Definitive Regulation. 622 In making this determination,
the issue of support was not considered by the Co mmission. However, as a result of the parallel
processes on the determination of the domestic in dustry definition and on the determination of

616Information Document, supra, footnote 81, pp. 5-6.
617Panel Report, para. 7.214 (referring to European Union's response to Panel Question 30, para. 88).
618Panel Report, para. 7.214.
and the European Union's response to Panel Question 34, para. 105).
620Panel Report, footnote 357 to para. 7.170 (quoting European Union's response to Panel Question 31).
621Upon the Panel's request, the European Union provided the list of the 70 EU producers, including the
names of the related companies involved in the production and/or selling of th e product concerned. (See List of
"Sampling Form for Community Producers" for inspection by interested parties (Panel Exhibit EU-19))
622European Union's response to Panel Question 31, paras. 92-94. As noted above, one producer
among the 46 cooperating producers was later found not to be cooperating and was dropped from the definition
of the domestic industry. (See supra, footnote 571)

standing, all of the companies that submitted inform ation, before and after the 15-day deadline, were
"wrongly grouped together in the 114 companies that the Information [D]ocument refers to".623
447. On appeal, China alleges that the Panel vi olated Article 11 of the DSU because it
"disregarded and ignored evidence submitted by Ch ina", including the Information Document, even
though such evidence demonstrated that the Commission excluded from the domestic industry all
producers who did not support the complaint. 624 China submits that, although the Information
Document did not constitute part of the measure at issue, it was nonetheless a piece of evidence and
"plainly relevant" for purposes of examining the issue of the definition of the domestic industry.625
448. We have sympathy for China's argument that whether the Information Document could be
taken into account as a piece of relevant evidence shoul d not depend on its legal status under EU law.
Although this document is not part of the measure at issue as a document issued by the Commission
during the investigation, it could nonetheless shed light on aspects of the investigation. At the same
time, we note that the Panel did pose certain qu estions to the European Union concerning the
Information Document626, and therefore did not simply disregard or ignore the evidence submitted by
China. Moreover, the European Union's explan ation regarding the "confused" and "parallel"
processes between the determination of the domest ic industry definition and the determination of
standing cast doubt on the reliability of the representa tions regarding the domestic industry contained
in the Information Document. We do not, therefore, consider that the Panel exceeded its margin of
discretion under Article 11 of the DSU in deciding to attribute less weight than China did to the
Information Document in reaching its finding.
449. China claims that the Panel also disregarded a letter sent by the Commission to two Chinese
exporters in response to their request for clarif ication regarding certain production figures contained
in the Definitive Regulation. 627 Specifically, the letter explains that the figure on production volume
by the domestic industry in recital 128 of the De finitive Regulation corresponds to "the Community
producers that supported the complaint and fully cooper ated in the investigation". China asserts that,

623European Union's response to Panel Question 31, para. 97.
624China's other appellant's submission, p. 47, heading (F).
625China's other appellant's submission, para. 93.
626For example, the Panel asked the European Union to clarify whether the number of producers who
came forward within the 15 -day deadline was 114, as indicated by th e Information Document, and whether the
number of producers expressing willingness to be included in the sample was 86, as indicated by the
Information Document, or 46, as indicated in the Definitive Regulation. (See Panel Question 31)
627Letter from the European Commission dated 18 November 2008 to Van Bael & Bellis in response to
letter from Van Bael & Bellis dated 12 November 2008 (Panel Exhibit CHN-39).

even though this letter "unambiguously demonstr ates" that only producers supporting the complaint
were included in the domestic industry
628, the Panel "totally ignored and disregarded"629 this evidence.
450. The reference in the letter to "the Community producers that supported the complaint and
fully cooperated in the investigation" repeats th e same phrase contained in recital 114 of the
Definitive Regulation. As discussed above, the Eu ropean Union explained to the Panel that this
"unfortunate standard formulation" remained in the Definitive Regulation as a result of the confusion
between the issue of standing and the domestic industry definition. 630 Moreover, as the trier of facts,
"[a] panel enjoys discretion in assessing whether a given piece of evidence is relevant for its
reasoning, and is not required to discuss, in its report, each and every piece of evidence". 631 Given
that the information in the letter essentially repli cates the information in the Definitive Regulation,
and in the light of the European Union's explanation regarding the background of such evidence, we
do not consider that the Panel erred in not explicitly mentioning or relying on this letter in reaching its
finding.
451. Finally, China alleges that the Panel err oneously accepted as a fact the unsubstantiated
statement of the European Union that at least one producer who did not support the complaint was
included in the domestic industry and in the sample. According to China, in asserting this fact, the
European Union was required to present relevant evidence by, for example, providing the list of
complainants and supporters who had come forward before the initiation. 632 Since the
European Union did not do so, China claims that the Panel failed to make an objective assessment of
the facts as required by Article 11 of the DSU by merely accepting the European Union's factual
assertion.
452. The European Union made the above statement in response to the Panel's question regarding
whether support for the investigation was used as a criterion in determining the definition of the
domestic industry. The European Union maintained that support was not used as a criterion, and
named a producer included in the sample who "had not supported the complaint", because it "was not
a complainant, nor a supporter of the complaint" and "had remained silent at the pre-initiation
phase".
633 The Panel, on the basis of this explanation by the European Union, found that "the fact that
at least one producer who did not affirmatively state support for the complaint was included in the
domestic industry" "demonstrated" that the Co mmission did not exclude producers not supporting the

628China's other appellant's submission, para. 98.
629China's other appellant's submission, para. 99.
630Panel Report, para. 7.214 (quoting European Union's response to Panel Question 89, para. 18).
631Appellate Body Report, Brazil – Retreaded Tyres, para. 202.
632China's other appellant's submission, para. 65.
633European Union's response to Panel Question 89, para. 19.

complaint from the domestic industry. 634 We note that, before the initiation of the investigation, the
Commission sent forms to all producers listed in the complaint brought by certain EU producers
against imports of fasteners from China, so as to verify whether they supported or opposed the
complaint (the "standing forms"). 635 On appeal, the European Uni on clarifies that the producer it
referred to before the Panel had not returned the standing form, and that the Commission was simply
not aware of whether that producer supported, op posed, or was neutral to, the investigation on
fasteners from China. Thus, in our view, there is evidence that the Commission had no knowledge of
this particular producer's position regarding the complaint.
453. Moreover, we note that, subsequent to the initia tion of the investigation, this producer was
sent a sampling form and returned the form within the 15-day deadline. It is noteworthy that the
sampling forms sent upon initiation did not contain an y questions relating to support for or opposition
to the complaint, and that th e sampling forms were sent to all EU fasteners producers known to the
Commission when the investigation was initia ted. This evidence lends support to the
European Union's contention that the only relevant criterion for inclusion in the domestic industry
definition was that a producer must return the comp leted form within 15 days and indicate that it
would be willing to be included in the sample. In the light of the above analysis, there is no basis to
interfere with the Panel's assessment of the facts.
454. In sum, the Panel had before it several pieces of evidence relating to the issue of whether the
Commission excluded producers who did not supp ort the complaint from the definition of the
domestic industry. There was evidence that s upported China's position that only those producers who
supported the complaint were included in the domest ic industry definition. Such evidence included
recital 114 of the Definitive Regulation and a letter sent by the Commission to the Chinese interested
parties. There was also evidence that indicated that support was not a condition for inclusion in the
domestic industry definition. Such evidence include d recitals 22 to 25 of the Definitive Regulation,
which explain, inter alia , the process of defining the domestic industry and the fact that sampling
forms were sent to all known producers at the begi nning of the investigation for purposes of defining
the domestic industry. As the Panel found, no qu estion was asked in the sampling form regarding
support for or opposition to the investigation. In addition, the Panel accepted, with reason, the
European Union's factual representation that one producer who did not affirmatively express a
position regarding the complaint was nonetheless sent the sampling form and included in the domestic
industry definition. The Panel ex amined and engaged with the above evidence, and ultimately came

634Panel Report, para. 7.215.
635See Extract from the Non-Confidential File: To Be Integrated in the File for Inspection by Interested
Parties: Note for the File dated 8 November 2007 and attached documents (Panel Exhibit EU-6).

to the conclusion that China had not demonstrat ed that the Commission excluded producers who did
not support the complaint from the domestic industry it defined. Our review of the Panel's reasoning
does not indicate that the Panel exceeded its margin of discretion in its weighing of various pieces of
evidence and in drawing its conclusions on this basis. Although the Panel attributed different weight
to certain evidence than did China, this is insufficient to demonstrate that the Panel's assessment of
the facts was not objective. Moreover, even if we might have reached a different conclusion had we
been asked to revi ew such evidence de novo , we are mindful that we "cannot base a finding of
inconsistency under Article 11 simply on the conclusion that we might have reached a different
factual finding from the one the panel reached".
636 We therefore decline to uphold China's appeal in
this regard.
2. The Exclusion of Producers Who Did Not Respond within 15 Days
455. China claims that the Panel erred in th e interpretation of Article 4.1 of the Anti-Dumping
Agreement when finding that "nothing in Article 4.1 … would preclude investigating authorities from
establishing deadlines for companies to come forward in order to be considered for inclusion in the
domestic industry". 637 Moreover, China asserts that the Panel failed to conduct an objective
assessment of the facts, as required by Article 11 of the DSU, when finding that the Commission "did
not act to exclude" producers that did not make themselves known within 15 days following the
initiation of the investigation638, and that the 15-day deadline was not insufficient or unreasonable.
456. In the finding challenged by China, the Panel stated that:
… while it seems clear that produ cers who did not make themselves
known within the 15-day period established at initiation were not
included in the domestic industry, we find that the investigating
authority did not act to exclude such producers. There seems to have
been a process of considering additional producers for inclusion in
the domestic industry, based on arguments made by the exporters.
639
(emphasis added)
457. Relevant evidence before the Panel noneth eless indicates that the Commission excluded
producers who did not make themselves known within the 15-day deadline from the definition of the
domestic industry. Before the Panel, the Eu ropean Union submitted that, upon initiation of the
fasteners investigation, the Commission invited all known producers to come forward and indicate
willingness to participate within 15 days, and did not include producers who made themselves known

636Appellate Body Report, US – Wheat Gluten, para. 151.
639Panel Report, para. 7.215.

after the 15-day deadline.640 As noted above, the European Union also explained before the Panel that
the Commission revisited the issue of standing after initiation in response to comments by the Chinese
interested parties. Thus, subsequent to the 15- day deadline, the Commissi on collected information
concerning additional producers, including data on their production volumes and their views on the
complaint.641 This process, according to the European Un ion, was confused with the issue of the
domestic industry definition in the Information Do cument. This confusion was clarified under the
Definitive Regulation, which makes it clear that "the domestic producers that … constitute[d] the
domestic industry [were] those that ma[d]e th emselves known within 15 days following initiation,
provide[d] the requested information and expres s[ed] their willingness to participate in the
investigation".642 The European Union repeated these expl anations several times during the Panel
proceedings.643 On appeal, the European Union simila rly states that, after receiving information
provided by the additional producers contacted after the 15-day deadline, the Commission "decided to
simply stick to the objective and reasonable deadline of 15 days it had set at the time of initiation in a
transparent and predictable manner".644
458. Thus, the evidence on the record, incl uding the Definitive Regulation and the
European Union's explanations, shows that the Commission excluded producers who did not make
themselves known within the 15-day deadline from the de finition of domestic industry. The Panel, in
reaching its finding that the Commission "did not act to exclude" such producers, stated that "[t]here
seems to have been a process of considering additiona l producers for inclusion in the domestic
industry, based on arguments made by the exporters". 645 On the basis of the European Union's
explanations, this "process of considering add itional producers" was conducted for purposes of
re-examining the issue of standing, and was not done in order to define the domestic industry.
459. Nonetheless, even though the Panel mistakenly concluded that the Commission did not
exclude producers not responding within the 15-day deadline, this did not affect the Panel's final
conclusion. The Panel found that "none of the prod ucers [considered after th e deadline] were in the

640See European Union's first written submission to the Panel, para. 302.
641See European Union's response to Panel Question 31, para. 97.
642European Union's response to Panel Question 31, para. 97.
643For example, in response to questions posed by China after the first Panel meeting, the European
Union stated that "[i]t is clear that this determination was based on those producers that came forward within the
15-day deadline and indicated their willingness to cooperate (see recital 24 of Council Regulation No 91/2009)".
(European Union's response to China's Question 4 after the first Panel meeting, para. 10) In response to the
Panel's question following the second Panel meeting, the European Union maintained that "[a]ll known
producers were contacted regardless of whether they supported or opposed the complaint and all were invited to
come forward. Those that did so within the deadline, and that indicated a willingness to cooperate with the
authorities were considered as part of the domestic industry." (European Union's response to Panel Question 89,
para. 18)
644European Union's appellee's submission, para. 92.
645Panel Report, para. 7.215. (emphasis added)

end included in the domestic industry".
646 Moreover, the Panel found it "reasonable for investigating
authorities to impose deadlines for domestic producers to make themselves known and then define the
domestic industry on the basis of those th at come forward within that deadline". 647 The Panel also
found that there was "no basis for concluding that the 15-day period was necessarily insufficient" for
purposes of defining the domestic industry.
648 The Panel therefore found that the European Union did
not act inconsistently with Article 4.1 of the Anti-Dumping Agreement , even if it did not include
producers not responding within 15 days.
460. In our view, in applying Article 4.1 to the fact s of the case, the Panel correctly found that it
was reasonable for the Commission to set a dead line by which producers were required to make
themselves known. Given the multiple steps that must be carried out in an anti-dumping investigation
and the time constraint on an investigation, an inv estigating authority must be allowed to set various
deadlines to ensure an orderly conduct of the investigation. Indeed, as Article 5.10 of the
Anti-Dumping Agreement provides, "[i]nvestigations shall, except in special circumstances, be
concluded within one year, and in no case more th an 18 months, after their initiation." Moreover,
Article 6.14 states that the rules of procedures set out in Article 6 of the Anti-Dumping Agreement
"are not intended to prevent the authorities of a Member from proceeding expeditiously".649 In this
regard, the Appellate Body has found that:
[i]nvestigating authorities must be able to control the conduct of their
investigation and to carry out the multiple steps in an investigation
required to reach a final determination. Indeed, in the absence of
time-limits, authorities would effectively cede control of
investigations to the interested parties, and could find themselves
unable to complete their investigations within the timelimits
mandated under the Anti-Dumping Agreement.
650
We therefore disagree with China's assertion that th e Panel erred in the interpretation of Article 4.1
when finding that "nothing in Article 4.1 … would preclude investigating authorities from
establishing deadlines for companies to come forward in order to be considered for inclusion in the
domestic industry".
651
461. China further submits that, even if the im position of a deadline for domestic producers to
come forward may be permissible for reasons of ne cessity, any deadline granted by the investigating

646Panel Report, para. 7.215.
647Panel Report, para. 7.219.
648Panel Report, para. 7.219.
649Emphasis added.
650Appellate Body Report, US – Hot-Rolled Steel , para. 73 (quoting Panel Report, US – Hot-Rolled
Steel, para. 7.54).
651Panel Report, para. 7.219.

authorities to domestic producers to come forwar d must be "reasonable" and "sufficient". 652 In this
respect, China submits that the Panel acted inconsis tently with Article 11 of the DSU by "ignor[ing]
the 'evidence'" submitted by China in order to de monstrate that the 15-day deadline was insufficient
and unreasonable.653 First, China maintains that, as it argued before the Panel, the 15-day deadline
was "very short and makes it much more likel y that complainants and [supporters of] the
investigation", rather than producers opposing th e investigation, will come forward within the
deadline.654 China submits that, in support of this ar gument, it referred the Panel to the Information
Document, which shows that, among the 114 producer s who made themselves known up to the date
the Information Document was published, 25 produ cers representing 9 per cent of EU production
opposed the complaint. Yet, Chin a argues, because of the 15-day deadline, these 25 producers were
not included in the domestic industry.655
462. We note that China again sought to rely on the Information Document in support of this
claim. As discussed above, in the light of the Eu ropean Union's explanation as to the inaccuracies
contained in the Information Document, we do no t consider that the Panel failed to conduct an
objective assessment of the facts in not relying on the Information Document for its decision.
Moreover, even assuming that the representations in the Information Document could be relied upon,
we fail to see how these representations demonstrate that the imposition of a 15-day deadline
influenced whether the producers opposing the complaint would respond to the request for
information. Indeed, the Information Docume nt states that, among the 114 producers who "came
forward and provided the requested information within the deadline "
656, 25 were opposed to the
complaint. It does not state that all of these 25 pr oducers came forward after the 15-day deadline, and
therefore does not support China's assertion that, because of the deadline , those who opposed the
complaint were excluded from the definition of the domestic industry.
463. China further argues that, by requiring producers to come forward within 15 days and express
willingness to be included in the sample within th at deadline, the Commission adopted an approach
that was "fundamentally non-objective", because producers opposing the investigation were less
likely to be willing to be part of the sample. 657 China, however, has not subs tantiated this assertion.

652China's other appellant's submission, para. 125.
653China's other appellant's submission, para. 130.
654China's other appellant's submission, para. 135.
655China's other appellant's submission, para. 136; China's first written submission to the Panel,
para. 244.
656Information Document, supra, footnote 81, p. 5. (emphasis added) We recall the European Union's
assertion that these 114 producers actually include those who came forward after the 15-day deadline. (See
supra, para. 446) However, China has not expressed its di sagreement with these factual assertions, and instead
seeks to rely on certain representations made in the Information Document.
657China's other appellant's submission, para. 137.

In any event, China's argument does not c oncern the reasonableness of the 15-day deadline per se.
Rather, it concerns the question of whether the defin ition of the domestic industry was consistent with
the Anti-Dumping Agreement when it was determined on the basis of producers' willingness to
cooperate by being included in the sample.
464. In sum, we do not consider that the Panel er red in its interpretati on or application of
Article 4.1 of the Anti-Dumping Agreement, or acted inconsistently with Article 11 of the DSU, when
finding that "the mere fact that the domestic industry as ultimately defined does not include any
particular proportion of producers expressing different views with respect to the complaint, or
producers who did not come forward within the 15-day period, does not demonstrate that the
European Union acted inconsistently with Article 4.1 of the [ Anti-Dumping Agreement ] in defining
the domestic industry."
658 We therefore decline to uphold China's appeal in this respect.
3. The Exclusion of Producers under Article 3.1 of the Anti-Dumping
Agreement
465. China claims that the Panel erred in its interpretation of Article 3.1 of the Anti-Dumping
Agreement by dismissing China's claim under that provision that the Commission erroneously
excluded from the domestic industry definition t hose producers who did not support the complaint
and did not come forward within the 15-day dead line simply because it had rejected China's same
claim under Article 4.1 of the Anti-Dumping Agreement.
466. Before the Panel, China argued that, "by de fining the domestic industry as including only
those producers that supported the complaint and excluding those who did not, the [European Union]
conducted a biased analysis favouring the interests of the complainants", and that "[s]uch an analysis
is not 'objective' as required by Article 3.1 of the [ Anti-Dumping Agreement]".659 China also argued
that, by setting the 15-day period granted to domes tic producers for indicating their willingness to be
included in the sample, the Commission "acted in a non-objective manner in that only producers
supporting the investigation were included in the domestic industry". 660 China then repeated the
arguments it had made under Article 4.1 as to why the 15-day period was insufficient and
unreasonable for purposes of defining the domestic industry. 661 The Panel rejected China's claim,
finding, instead, that:
China asserts that it is only possible to undertake an objective
examination pursuant to Article 3.1 if the result of the examination is

658Panel Report, para. 7.219.
659China's first written submission to the Panel, para. 244.
660China's second written submission to the Panel, para. 577.
661See China's second written submission to the Panel, paras. 578-580.

not predetermined by the way the domestic industry is defined. We
do not disagree. However, we have rejected China's position with
respect to this aspect of its claim challenging the domestic industry
definition in this case. China ma kes no other allegations in support
of its claim of violation of Article 3.1, and we therefore dismiss that
aspect of China's claim.
662 (footnote omitted)
467. In our analyses in the preceding two subsections, we have declined to uphold China's appeal
of the Panel's findings that the European Union di d not act inconsistently with Article 4.1 of the
Anti-Dumping Agreement by excluding producers from the domestic industry definition who did not
support the complaint and who did not respond to th e sampling forms within 15 days. Given that,
with regard to these aspects of the fasteners investigation, China has not provided arguments under
Article 3.1 that differ from those under Article 4.1, we also decline to uphold China's appeal of the
Panel's finding that the European Union did not act inconsistently with Article 3.1 of the
Anti-Dumping Agreement by excluding these producers from the domestic industry.
F. Conclusion
468. In sum, with regard to China's other appeal of the Panel's findings under Articles 4.1 and 3.1
of the Anti-Dumping Agreement , we have reached the following findings. We find that the Panel
erred in finding that "the European Union did not act inconsistently with Article 4.1 of the
[Anti-Dumping Agreement ] in defining a domestic industry comprising producers accounting for
27 per cent of total estimated EU production of fasten ers" on the basis that the collective output of
these producers represented "a major proportion" of the total domestic production. 663 However, we
find that the Panel did not err in finding that Chin a failed to establish that the European Union acted
inconsistently with Article 3.1 of the Anti-Dumping Agreement by making an injury determination on
the basis of a sample of producers that was allegedly not representative. We also do not consider that
the Panel erred in its interpretation or a pplication of Articles 4.1 and 3.1 of the Anti-Dumping
Agreement, or acted inconsistently with Article 11 of the DSU, when finding that "the mere fact that
the domestic industry as ultimately defined does not include any particular proportion of producers
expressing different views with respect to the complaint, or producers who did not come forward
within the 15-day period, does not demonstrate that the European Union acted inconsistently with
Article 4.1 of the [ Anti-Dumping Agreement ] in defining the domestic industry" 664 or acted
inconsistently with Article 3.1 of that Agreement.

662Panel Report, para. 7.221.
663Panel Report, para. 7.230.
664Panel Report, para. 7.219.

VII. Appeal of the Panel's Findings Regarding As pects of the Dumping Determination in the
Fasteners Investigation under Articles 6.4, 6.2, and 2.4 of the Anti-Dumping Agreement
A. Introduction
469. We turn now to address the European Union' s and China's appeals of the Panel's findings
regarding certain aspects of the Commission's dumping determination in the fasteners investigation.
Specifically, the European Union appeals the Panel's finding that it acted inconsistently with
Articles 6.4 and 6.2 of the Anti-Dumping Agreement by not providing a timely opportunity for
Chinese interested parties to see the product types used by the Commission for purposes of comparing
export price and normal value in the dumping determin ation. China appeals the Panel's finding that
the European Union did not act inconsistently with Article 2.4 of the Anti-Dumping Agreement by
failing to make a "fair comparison" between the export price and the normal value in the dumping
determination. We begin our analysis with a description of the relevant factual background
underlying both the European Union's and China's cl aims. We then discuss the relevant interpretation
of the provisions of the Anti-Dumping Agreement under which the European Union's and China's
claims are raised. Next, we address the specific claims and arguments raised on appeal.
B. The Relevant Factual Background
470. The Panel found that, in the questionnaires sent to the producer in India, Pooja Forge
665, and
to the Chinese producers, the Commission requested th at information on the investigated products be
reported on the basis of categories defined by Product Control Numbers ("PCNs"). 666 The Panel
noted that the following six elements made up the PCNs identified by the Commission: type of
fasteners (by CN code); strength/hardness; coating; presence of chrome on coating; diameter; and
length/thickness. All but two of these elements, in turn, are further divided into sub-categories, each
of which is assigned a code in the form of a number or a letter. The elements contained in the PCNs
thus represent 38 narrowly defined specifications of fasteners. The questionnaire provided, as an
example, a product having the following characteris tics: "self-tapping screw, case hardening, not
coated, diameter 4,2 millimeters, length 13 millimete rs". On the basis of the corresponding numbers
and letters assigned to each of the characteristics, this product would have a PCN of 2XNR042013.
667

665We recall that, due to the European Union's designa tion of China as an NME, and the fact that MET
was not granted to the Chinese producer s in the fasteners investigation, the Commission established the normal
value on the basis of the prices of fasteners sold in the analogue country, India. The Commission identified two
Indian companies that produced the fasteners that were the subject of the investigation, and one of them, Pooja
Forge, cooperated with the investigation. (See Definitive Regulation, supra, footnote 4, recitals 38 and 92)
666See Panel Report, para. 7.292 (referring to European Commission, Anti-Dumping Questionnaire for
Chinese Exporters/Producers (Panel Exhibit CHN-51), pp. 11-13).
667See Panel Exhibit CHN-51, supra, footnote 666, pp. 11-13.

471. The questionnaire sent to Pooja Forge also requested that information be provided on the
basis of the same PCNs. However, Pooja Forge di d not provide information categorized on the basis
of the PCNs as requested. Because the normal valu e in the fasteners investigation was established on
the basis of the information provided by Pooja Forge, the Commission could not base its comparison
between the normal value and export price on full PCNs.
668 Therefore, it resorted to the use of
"product types" defined by two factors, strength class and the distinction between standard and special
fasteners, in the price comparisons for the dumping determination.669
472. The Panel found that the Chinese producers were info rmed very late in the proceedings of the
product types that formed the basis of the comparisons underlying the Commission's dumping
determinations. Specifically, the General Disclo sure Document, issued towards the end of the
investigation on 3 November 2008, indicated that the Commission based its normal value
determination on product types, but did not specify the number of, or relevant characteristics of, the
product types or how they were determined.
670
473. On 8 November 2008, two Chinese producers sought clarification from the Commission
regarding the product types used, and specifically ask ed for a linkage between the PCNs on which the
Chinese producers based their questionnaire submissions and the product types eventually used by the
Commission. According to the Panel, this letter "clearly convey[ed] these two Chinese
producers' request to see information regarding th e product types that established the basis of the
Commission's normal value determination and the relationship between these product types and the
PCNs pertaining to the Chinese producers' products". 671 The Commission replied on 13 November
2008, stating that, "beside[s] product characteristi cs as specified in the PCN, a distinction was
introduced between standard and special products since this was found to have a significant impact on
prices".672 It went on to say that, for these two Chin ese producers, "their entire export volume was
considered as being standard products". 673 The Panel found that this response did "not explain how

668See Panel Report, para. 7.293 (referring to European Union's response to Panel Question 43(b)).
669See Panel Report, para. 7.293 (referring to Definitive Regulation, supra, footnote 4, recital 102; and
Panel Exhibit CHN-31, supra, footnote 310, p. 2).
670See Panel Report, para. 7.485. In addition, unde r the heading "Comparison", the General Disclosure
Document stated that the price compar ison between the fasteners from China and those sold by Pooja Forge on
the Indian market was "made by distinguishing between standard and special fastener types". (General
Disclosure Document, supra, footnote 73, para. 93) The same statement is also contained in recital 102 of the
Definitive Regulation.
671Panel Report, para. 7.486.
672Panel Report, para. 7.487 (quoting Email Message dated 13 November 2008 from the European
Commission to Van Bael & Bellis (Panel Exhibit CHN-29), p. 1).
673Panel Report, para. 7.487 (quoting Panel Exhibit CHN-29, supra, footnote 672, p. 1).

the product types were established in the determination of normal value, or the relevant characteristics
of those product types".
674
474. On 17 November 2008, the Chinese producers again sought clarification. They noted that the
non-confidential version of Pooja Forge's ques tionnaire response contained no indication that
Pooja Forge reported sales on the basis of PCNs. Thus, the Chinese producers asked:
In abstract terms, was normal value established on a PCN basis, or
were more general types of [the Indian producer's] fasteners matched
with groups of PCNs from our clients? In that context, it would still
be very useful for us if we could have a listing simply of which type
of fastener or which PCNs of [t he Indian producer] were matched
with the PCNs of our clients.675
The Panel described this letter as "clearly rep eat[ing] these Chinese produ cers' request to see
information on the basis of which product types for the Indian producer were established".676
475. The Commission replied in a letter dated 21 November 2008 that the comparison "was not
made on the basis of the full PCN, but on part [ sic] of the characteristics of the product, namely the
strength class as well as the abovementioned distin ction between special and standard products". 677
The Panel found that this was the first time the Commission clearly informed the Chinese producers
that it did not make its findings based on PCNs, but on the characteristics of strength class and the
distinction between standard and special fastener s. The letter came one working day before the
deadline to make comments on the General Disclosure Document.678
476. The Panel record indicates that, on 24 Novemb er 2008, two days after the deadline for
comments, one Chinese producer sent another letter to the Commission, expressing the view that it
was not possible for it to comment on the Commission's dumping determination without knowing
what types or groups of products of Pooja Forge were actually matched with the Chinese products.
679

674Panel Report, para. 7.487.
675Panel Report, para. 7.488 (quoting Letter dated 17 November 2008 from Van Bael & Bellis to the
European Commission concerning the Definitive Disclosure Document: Request for Information II on behalf of
Kunshan Chenghe Standard Component Co. Ltd and Ningbo Jinding Fastening Piece Co. Ltd. (Panel Exhibit
CHN-30), p. 2). (emphasis omitted)
676Panel Report, para. 7.488.
677Panel Report, para. 7.489 (quoting Panel Exhibit CHN-31, supra, footnote 310, p. 2).
678Panel Report, para. 7.489.
679Letter dated 24 November 2008 from Van Bael & Bellis on behalf of Kunshan Chenghe Standard
Component Co. Ltd. to the European Commission, Comm ents on the Definitive Disclosure Document (Panel
Exhibit CHN-59), p. 4.

477. Thus, the Panel's factual findings, as well as th e Panel record, indicate the following timeline
relating to the relevant events that occurre d in the context of the Commission's dumping
determination:
Timeline of Relevant Events
9 November 2007 Notice of Initiation
3 November 2008 General Disclosure Document
8 November 2008 First request for clarification
13 November 2008 Commission response
17 November 2008 Second request for clarification
21 November 2008 Commission response clarifying product types
22 November 2008 Deadline for comment s on General Disclosure Document
24 November 2008 Comments by the Chinese producer

C. The Relevant Interpretation of Articles 6.4 and 2.4 of the Anti-Dumping Agreement
478. Article 6.4 of the Anti-Dumping Agreement provides:
The authorities shall whenever practicable provide timely
opportunities for all interested parties to see all information that is
relevant to the presentation of thei r cases, that is not confidential as
defined in paragraph 5, and that is used by the authorities in an
anti-dumping investigation, and to prepare presentations on the basis
of this information.
479. The Appellate Body has found that Article 6.4 re fers to "provid[ing] timely opportunities for
all interested parties to see all informati on that is relevant to the presentation of their cases", and that
the possessive pronoun "their" "clearly refers to the earlier reference in that sentence to 'interested
parties'".
680 Therefore, it is the interested parties, rather than the authority, who determine whether the
information is in fact "relevant" for the purposes of Article 6.4. 681 Moreover, according to the
Appellate Body, whether the information was "used" by the authority does not depend on whether the
authority specifically relied on that information. Rather, it depends on whether the information is
related to "a required step in the anti-dumping investigation". 682 Thus, Article 6.4 concerns
information relating to "issues which the investigat ing authority is required to consider under the
[Anti-Dumping Agreement], or which it does, in fact, consider, in the exercise of its discretion, during
the course of an anti-dumping investigation."683

680Appellate Body Report, EC – Tube or Pipe Fittings, para. 145. (original emphasis)
681See Appellate Body Report, EC – Tube or Pipe Fittings, para. 145.
682Appellate Body Report, EC – Tube or Pipe Fittings, para. 147.
683Panel Report, EC – Salmon (Norway), para. 7.769. (footnotes omitted)

480. The interested parties' right under Article 6.4, therefore, is to see all non-confidential
information relevant to the presentation of their cases and used by the investigating authority.
Article 6.4 thus applies to a broad range of informat ion that is used by an investigating authority for
purposes of carrying out a required step in an anti -dumping investigation. We note the European
Union's view that the term "information" in Artic le 6.4 "concerns facts and raw data rather than
factual determinations a nd conclusions by the investigating authorities".
684 In our view, there is no
textual basis in Article 6.4 for limiting information "relevant to the presentation of [parties'] cases"
and "used by the authorities" to facts or raw data unprocessed by the authorities. Indeed, the broad
range of information subject to the obligation un der Article 6.4 may take various forms, including
data submitted by the interested parties, and in formation that has been processed, organized, or
summarized by the authority. We do not see why only facts and raw data would be relevant to the
parties' presentation of their cases. A proper in terpretation of Article 6.4 does not mean, however,
that an investigating authority's reasoning or internal deliberation in reaching its final determination is
also subject to the obligation under Article 6.4. Article 6.4 concerns the information that is used by an
authority, rather than an authority's detailed anal ysis of the information, or the determination it
reaches based on such information.
481. The European Union also argues that the cont ext of Article 6.4, as provided by the other
paragraphs of Article 6, confirms that the oblig ation under Article 6.4 only concerns facts and raw
data submitted by interested parties. The Europe an Union submits that Articles 6.1 to 6.3 provide
parties the right to submit their own information, and Articles 6.6 and 6.7 impose an obligation on
investigating authorities to verify the information submitted by the parties. Article 6.8, in turn, allows
the use of "facts available" when an inter ested party does not provide necessary information. 685 Thus,
the European Union asserts, Article 6.4 is limited to addressing "the parties' right to know what other
interested parties have submitted in terms of evidence and information". 686 In our view, however, the
European Union's recourse to the other paragr aphs under Article 6 is unavailing. The only
qualification on the term "information" under Article 6. 4 is that it is "relevant to the presentation of
their cases", "not confidential as defined in para graph 5", and "used by the authorities in an
anti-dumping investigation". Article 6.2 further c onfirms that access to all such information is
important because, without such information, the in terested parties may not have "a full opportunity
for the defence of their interests". Moreover, wher e the term "information" is to be specifically
qualified, the relevant paragraphs under Article 6 clearly provide so. For example, Article 6.3 refers
to "oral information", Article 6.5 applies to in formation that is "by na ture confidential", and

684European Union's appellant's submission, para. 253.
685European Union's appellant's submission, paras. 258, 259, 262, and 263.
686European Union's appellant's submission, para. 260. (original emphasis)

Article 6.6 concerns information "supplied by interested parties". Without such qualifications, we see
no textual basis in Article 6.4, or contextual basi s under Article 6, for limiting the term "information"
in Article 6.4 to only that provided by other interested parties.
482. The European Union further argues that, pursuant to Article 6.9, the authorities must inform
all interested parties of "the essential facts under c onsideration which form the basis for the decision"
before a final determination is made. In the Eu ropean Union's view, the use of the phrase "essential
facts" rather than the word "information" in Artic le 6.9 indicates that Articles 6.1 to 6.8 concern the
information-gathering process. The European Union also argues that Article 6.9 marks the end of the
process and requires a disclosure of the authority's essential factual conclusions 687, and that the
"product types" used to compare export price a nd normal value fall into the category of essential
facts.688 The European Union further contends that the differences between the obligations under
Articles 6.4 and 6.9 are "well established in WTO ju risprudence". For example, the European Union
argues that in Guatemala – Cement II the panel found that Article 6.4 generally provided an "access to
the file"689 right, whereas Article 6.9 required more and c ould not be satisfied "simply by offering to
provide interested parties with copies of all information in the file".690
483. The differences alleged by the European Union be tween Article 6.9 and the other paragraphs
of Article 6 do not, in our view, restrict the meaning of the word "information" in Article 6.4 to the
narrow scope the European Union attributes to it. As discussed above, Article 6.4 refers broadly to
"all information that is relevant to the presentati on of [the interested parties'] cases". Such
information may come in different forms, including not only "facts or raw data" submitted by the
other parties, but also information that an inves tigating authority organizes, processes, or summarizes
at each stage of an anti-dumping investigation. Although Article 6.9 refers to "the essential facts
under consideration which form the basis" for the au thority's final determina tion, we do not consider
that what the terms "information" and "essential f acts" refer to must be mutually exclusive.
Depending on the specific circumstances of a case, the "information" relevant to the presentation of an
interested party's case can be a broader concept than the essential facts relied on by the authority, or it
may overlap with such "essential f acts". The "essential facts" under Article 6.9, which form the basis
for a final determination, are those that are material for the authority's decision, whereas
"information" that is relevant to the presentation of a party's case, and used by the authority, is not
necessarily what the authority relies on in reaching its final determination. Moreover, information

687European Union's appellant's submission, paras. 264 and 265.
688European Union's responses to questioning at the oral hearing.
689European Union's appellant's submission, para. 261 (quoting Panel Report, Guatemala – Cement II ,
para. 8.133).

within the meaning of Article 6.4 has to be pr ovided to interested parties in a timely fashion
throughout the investigation. It is not sufficient to provide such information only "before a final
determination is made" within the meaning of Ar ticle 6.9. In sum, we consider that the
European Union's reliance on the context of Article 6.4 is unavailing to its position.
484. The European Union refers to the panel's finding in Korea – Certain Paper to point out that
what had to be disclosed upon request in that disput e were the actual figures for cost of manufacture,
expenses or profits used in the calcu lation of the constructed normal value.
691 The European Union
further submits that the Appellate Body's finding in EC – Tube or Pipe Fittings , that the
European Communities was required to disclose a document containing a summary of the "raw
data"692 on some of the injury factors under Article 3.4 of the Anti-Dumping Agreement, also supports
its understanding of the term "information" in Article 6.4. However, the fact that the findings in prior
disputes under Article 6.4 may have concerned su ch "raw data" only shows that that was the
"information" at issue in those disputes. The particular "information" found to be subject to
Article 6.4 in specific disputes, however, does not limit the scope of the term in Article 6.4 in all
disputes arising under that provision. Moreover, with regard to the Appellate Body's finding in EC –
Tube or Pipe Fittings , to the extent that the European Union uses the term "raw data"
693 to mean
information submitted by the parties and not processed by the investigating authority, we note that
this view is contradicted by the facts at issue in th at dispute. Rather, the "information" relevant to the
Appellate Body's finding under Article 6.4 in that ca se consisted of data that had been aggregated and
summarized by the Commission as well as the Comm ission's evaluation of this data. More
specifically, the "information" contained worksheets pr epared by the European investigating authority
regarding the injury factors listed in Article 3.4 on the basis of evidence submitted by the interested
parties.694
485. In sum, under Article 6.4 of the Anti-Dumping Agreement , what information is considered
"relevant to the presentation of [the interested pa rties'] cases" and "used by the authorities" would
depend on the specific "step" of the anti-dumping inv estigation and the particular issue before the
investigating authority. We recall that, in this dispute, China claims that the Commission failed to
provide timely opportunities for the Chinese producer s to see certain information relevant to the
comparison between the export price and normal va lue for purposes of the dumping determination in

691European Union's appellant's submission, para. 253 (referring to Panel Report, Korea – Certain
Paper, para. 7.199).
692European Union's appellant's submission, para. 254 (referring to Appellate Body Report, EC – Tube
or Pipe Fittings, paras. 138-141).
693European Union's appellant's submission, para. 254.
694Panel Report, EC – Tube or Pipe Fittings , para. 7.307 and footnote 256 thereto. See also China's
appellee's submission, para. 397.

the fasteners investigation. We therefore focus our analysis on the type of "information" covered
under Article 6.4 and when it has to be disclosed, in the context of the comparison between the export
price and normal value within the meaning of Article 2.4 of the Anti-Dumping Agreement.
486. Article 2.4 of the Anti-Dumping Agreement provides, in relevant part:
A fair comparison shall be made between the export price and the
normal value. This comparison shall be made at the same level of
trade, normally at the ex-factory level, and in respect of sales made at
as nearly as possible the same time. Due allowance shall be made in
each case, on its merits, for differences which affect price
comparability, including differences in conditions and terms of sale,
taxation, levels of trade, quantities, physical characteristics, and any
other differences which are also demonstrated to affect price
comparability. … The authorities shall indicate to the parties in
question what information is necessar y to ensure a fair comparison
and shall not impose an unreasonable burden of proof on those
parties. (footnote omitted)
487. As the Appellate Body has explained:
[U]nder Article 2.4, the obligation to ensure a "fair comparison" lies
on the investigating authorities , and not the exporters. It is those
authorities which, as part of their investigation, are charged with
comparing normal value and expor t price and determining whether
there is dumping of imports.
695 (original emphasis)
488. However, this does not mean that the interested parties do not have a role to play in the
process of ensuring a fair comparison. Rather, pane ls in previous disputes have found that exporters
bear the burden of substantiating, "as constructively as possible" 696, their requests for adjustments
reflecting the "due allowance" within the meaning of Article 2.4. If it is not demonstrated to the
authorities that there is a difference affecting pri ce comparability, there is no obligation to make an
adjustment.697 Moreover, the fair comparison obligati on does not mean that the authorities must
accept each request for an adjustment . The authorities "must take steps to achieve clarity as to the
adjustment claimed and then determine whether and to what extent that adjustment is merited".698
489. The process of making a fair comparison must also be understood in the light of the last
sentence of Article 2.4, which requires an investigating authority to "indicate to the parties in question
what information is necessary to ensure a fair comparison and shall not impose an unreasonable
burden of proof on those parties". The last sentence of Article 2.4 thus adds a procedural requirement

695Appellate Body Report, US – Hot-Rolled Steel, para. 178.
696Panel Report, EC – Tube or Pipe Fittings, para. 7.158.
698Panel Report, EC – Tube or Pipe Fittings, para. 7.158.

to the general obligation of investigating author ities to ensure a fair comparison. The sentence
imposes an obligation on the investigating authority to tell the parties what information the authority
will need in order to ensure a fair comparison. Thus, whereas the exporters may be required to
"substantiate their assertions concerning adjustments"
699, the last sentence of Article 2.4 requires the
investigating authorities to "indicate to the parties" what information these requests should contain, so
that the interested parties will be in a position to make a request for adjustme nts. This process has
been described as a "dialogue"700 between the authority and the interested parties.
490. In our view, as a starting point for the dialogue between the investigating authority and the
interested parties to ensure a fair comparison, the authority must, at a minimum, inform the parties of
the product groups with regard to which it will c onduct the price comparisons. For example, the
authority may choose to make comparisons of tr ansaction prices for a number of groups of goods
within the like product that share common characteris tics, thus minimizing the need for adjustments,
or it may choose to make adjustments for each diffe rence affecting price comparability to either the
normal value or the export price of each transaction to be compared. 701 Without knowing which
particular method the authority will use to categorize the products for purposes of price comparison, it
would not be possible for the interested parti es to know what information will be necessary for
purposes of ensuring a fair comparison, and to request adjustments accordingly. Thus, as the Panel
correctly found in its analysis of China's claim under Article 6.4 of the Anti-Dumping Agreement:
Ensuring that the comparison of normal value and export price is
based on comparable goods is, as pr ovided for in Article 2.4, an
obligation on investigating authorities. Foreign producers have a role
in that process, by requesting due allowance for differences
demonstrated to affect price comparability. In order to fulfil their
role, and thus ensure that their in terest in a fair comparison is
protected, however, it is necessary that they know the basis on which
the investigating authority undertakes to make the comparison of
normal value and export price, and in sufficient time to allow the
exporters to make and substantiate requests for due allowance.
702
491. Furthermore, in an anti-dumping investiga tion of imports from NMEs, where the normal
value is not established on the basis of the foreign producers' domestic sales, but is established on the
basis of the domestic sales in an analogue country, the investigating authority's obligation to inform
the interested parties of the basis of the price co mparison is even more pertinent for ensuring a fair
comparison. This is because foreign producers are unlikely to have knowledge of the specific
products and pricing practices of the producer in an analogue country. Unless the foreign producers

699Panel Report, EC – Tube or Pipe Fittings, para. 7.158.
701See Panel Report, para. 7.297.
702Panel Report, para. 7.491.

under investigation are informed of the specific pr oducts with regard to which the normal value is
determined, they will not be in a position to request adjustments they deem necessary.
492. With the above interpretation in mind, we turn to review the European Union's and China's
claims and arguments raised on appeal.
D. The European Union's Appeal of the Panel's Findings under Articles 6.4 and 6.2 of
the Anti-Dumping Agreement
493. The European Union appeals the Panel's finding that the European Union acted inconsistently
with Articles 6.4 and 6.2 of the Anti-Dumping Agreement when the Commission failed to disclose
information regarding the product types to Chin ese producers until one working day before the
deadline for submitting comments. Specifically, the Panel found that, by failing to disclose
information regarding the product types, "the Europ ean Union failed to provide a timely opportunity
for the Chinese [interested parties] to see information" 703 pertaining to the basis on which the
Commission made the comparison of normal value and e xport price, in violation of Article 6.4 of the
Anti-Dumping Agreement. Because the Commission failed to disclose the product types on a timely
basis, the Panel also found that it had denied the Chinese interested parties a "full opportunity for the
defence of their interests", in violation of Article 6.2 of the Anti-Dumping Agreement.704
494. The European Union's appeal under Article 6.4 is based on the following two grounds. First,
the European Union maintains that the grouping of products into product types was a "factual
determination" made by the Commission and was not "i nformation" as that term is used in Article 6.4
of the Anti-Dumping Agreement .
705 Second, the European Union argues that the Panel violated
Article 11 of the DSU in making its determinati on under Article 6.4 because it refused to consider
certain evidence regarding the "timeliness" of th e Commission's disclosure, and therefore did not
consider the evidence in its totality.706
495. With respect to the first ground of appeal, as discussed above, we disagree with the
European Union's view that the term "information" in Article 6.4 only "concerns facts and raw data
rather than factual determinations and c onclusions by the investigating authorities". 707 Rather,
Article 6.4 applies to a broad range of information th at is relevant to the presentation of the interested
parties' cases and is used by an investigating author ity for purposes of carrying out a required step in
an anti-dumping investigation. Such informati on includes evidence submitted by the interested

703Panel Report, para. 7.492.
704Panel Report, para. 7.495.
705European Union's appellant's submission, para. 248.
706European Union's appellant's submission, para. 279.
707European Union's appellant's submission, para. 253.

parties, as well as data processed, organized, or summarized by the authority. An authority's
reasoning or internal deliberation in reaching a determination, however, does not constitute
"information" subject to the obligation under Article 6.4.
496. In this dispute, the product types used by the Commission concerned "a required step"
708 in an
anti-dumping investigation, namely, the compar ison between export price and normal value for
purposes of the dumping determination. The produc t types used by the Commission for purposes of
the dumping determination were partic ularly relevant to the interested parties' cases, given the factual
background of this case. We recall that the questionnaire sent to the Chinese producers and the Indian
producer requested that products be identified on the basis of PCNs, thus leaving at least two Chinese
exporters709 with the impression that such PCNs wo uld be used for purposes of the comparison
between export price and normal value. As the Panel noted, "it appears from the structure of the
questionnaires that [requests for adjustments to ensure a fair comparison] will not be necessary
because of the categorization of th e product according to PCN groups".710 Indeed, by using the PCNs
as the organizing principle when gathering produc t information from the interested parties, the
Commission's approach created a reasonable expect ation that price comparisons would be conducted
on a very particular basis. Moreover, in the lig ht of the very precise nature of the physical
characteristics listed under the PCNs, it was also reas onable to assume that few adjustments would be
necessary, as prices of narrowly defined produc ts by the Chinese producers would have been
compared to prices of equally narrowly defined products in the analogue country, India.
497. Nonetheless, although the Chinese producers provi ded information on the basis of PCNs, the
Indian producer, Pooja Forge, did not provide information on that basis. Consequently, the
Commission decided to use a different method of product grouping to conduct the comparison,
namely, what it called "product types", which it defined on the basis of two factors: strength class and
the distinction between standard and special fasten ers. The product types used by the Commission
were thus a critical piece of information relating to a required step in the investigation, and these
product types were in turn established on the basis of the product information provided by the Indian
producer. They were not simply the Commission's reasoning in reaching its final determination.
498. Moreover, we recall that the PCNs include six elements further divided into 38 specifications,
which could have resulted in hundreds of different combinations. Yet, the PCN characteristics and
the product types overlap only with regard to one element, na mely, the strength class. Thus, the

708Appellate Body Report, EC – Tube or Pipe Fittings, para. 147.
709These two producers later requested the Commission to clarify the meaning of "product types" used
in the dumping determination.
710Panel Report, para. 7.491.

differences between the PCNs and the product types used by the Commission could have prompted
the Chinese producers to request that adjustments be made for any differences that might have
affected price comparability between the Chinese a nd Indian fasteners, within the meaning of
Article 2.4 of the Anti-Dumping Agreement . Indeed, without knowi ng what constituted "product
types", "it would be difficult if not impossible, for foreign producers to request adjustments that they
consider necessary in order to ensure a fair comparison." 711 Thus, the information concerning the
product types, including their characteristics and how they were determined, constituted "information"
within the meaning of Article 6.4 of the Anti-Dumping Agreement , because they were used in the
dumping determination made by the Commission 712, and were indispensible to the parties'
presentation of their cases concerning the dumping determination.
499. Turning to the European Union' s claim that the Panel violated Article 11 of the DSU, we
recall that, as discussed above in section VI.E , not every error allegedly committed by a panel
amounts to a violation of Article 11 of the DSU. Rather, a participant claiming that a panel ignored
certain evidence, and hence acted inconsistently with Article 11, must explain why the evidence is so
material to its case that the panel's failure to addr ess such evidence has a bear ing on the objectivity of
the panel's factual assessment.
500. In this regard, we note the Eur opean Union's assertion that "[o]ne might wrongly conclude
from the Panel's findings" that the Chinese producers requesting to see the product types were unable
to make any presentations due to time constraints.
713 According to the European Union, one Chinese
producer "did submit comments" on the requested information in a letter dated 24 November 2008 714
and, in that letter, it did not request an extension of the time for making presentations. 715 T h e
European Union argues that this letter shows that "timing was not the problem for the interested
parties", but the letter was not mentioned by the Panel in its reasoning. 716 In our view, the assertion
that the Panel's findings "might" give a certain impression does not explain why the Panel's alleged
"disregard" of a piece of evidence calls into questi on the objectivity of the Panel's factual assessment.

711Panel Report, para. 7.491.
712See Panel Report, EC – Salmon (Norway), para. 7.769.
713European Union's appellant's submission, para. 291. (emphasis added)
714European Union's appellant's submission, para. 291. (emphasis omitted)
715European Union's appellant's submission, para. 292.
716European Union's appellant's submission, para. 294. (original emphasis)

On its face, such a claim simply does not rise to the level of egregiousness that a violation of
Article 11 of the DSU requires.
717
501. The European Union further submits that the Panel disregarded the Information Document,
which "signall[ed] the use of 'product types'" thr ee months prior to the issuance of the General
Disclosure Document.718 Thus, in the European Union's view , any "problem with the timing of the
disclosure" regarding product types "was in large part due to the fact that the Chinese interested
parties never requested to see the basis for th e product type groupings until very late in the
proceedings."719
502. Although the European Union's argument suggests that the Information Document was an
important piece of evidence supporting its position, a review of the relevant evidence indicates the
contrary. The Information Document, like the Ge neral Disclosure Document, stated that the
Commission based its normal value determination on product types, but did not specify the relevant
characteristics of the product typ es or how they were determined. 720 Moreover, as the Panel properly
found, the correspondence between the Commi ssion and the two Chinese producers requesting
clarification regarding the product types showed th at "until the receipt of the General Disclosure
Document, the Chinese producers were under the im pression that the Commission would make its
dumping determinations on the basis of PCNs, as re quested in the questionnaires sent to the Chinese
and the Indian producers". 721 It should also be recalled that the "information" sought by the Chinese
producers was a clarification of what constituted "product types" as referenced in the General
Disclosure Document. Thus, the fact that the In formation Document referred to the concept of
product types does not alter the Panel's ultimate fi nding that the Commission did not disclose the
requested clarification until one working day before the deadline for comments. We therefore do not
agree with the European Union's assertion that the Panel erroneously ignored the evidence contained
in the Information Document in reaching its finding.
503. The European Union also claims that, because some Chinese producers submitted information
describing certain characteristics that, they believed, distinguished different types of fasteners, and

717In any event, we note that, in the letter referred to by the European Union, the Chinese producer
expressed the view that it was not possible to comment on the Commission's dumping determination without
knowing what types or groups of products of Pooja Forge were actually matched with the Chinese products. The
letter thus shows that the Chinese producers still considered the information provided by the Commission
insufficient for them to comment properly on the dumping determination. This letter, therefore, does not lend
support to the European Union's position, and the Panel acted properly in not relying on this evidence for
reaching its finding.
718European Union's appellant's submission, para. 284.
719European Union's appellant's submission, para. 286.
720Information Document, supra, footnote 81, p. 12.
721Panel Report, para. 7.490.

because the product types used for purposes of the dumping determination reflected the same
characteristics, the Chinese producers "clearly were able to make presentations based on this
'information'".722 Specifically, the European Union refers to a submission made on 22 February 2008
by Jiaxing Association of Fastener Import & Expo rt Companies ("Jiaxing Association") describing
the difference between fasteners produced by Chinese producers and those produced by
EU producers. Jiaxing Association argued that the Chinese companies mostly produced standard
fasteners in lower strength classes, while EU producers mostly produced non-standard fasteners in
higher strength classes723, and that fasteners by Chinese and EU producers were not competitive with
each other. The European Union asserts that "the Panel's conclusion that Chinese producers were not
given a timely opportunity to 'see information relevant to the presentation of their cases' is flawed as
the alleged 'information' was no other than what th e Chinese interested parties had been presenting as
being the main characteristics for distingu ishing between product types throughout the
investigation."724
504. However, the evidence that th e European Union claimed the Panel "disregarded" was not
apposite to the issue examined by the Panel under Article 6.4 of the Anti-Dumping Agreement. As
discussed, what information may be considered "r elevant for the presentation" of the interested
parties' cases under Article 6.4 depends on the par ticular stage of the anti-dumping investigation and
the specific issue before the investigating author ity. China's claim and the Panel's finding under
Article 6.4 concern the information on product typ es that the Commission used for purposes of price
comparisons between fasteners produced by the Indi an producer (rather than EU producers) and by
the Chinese producers in its dumping determination. Thus, the information contained in Jiaxing
Association's submission, which was made in a cont ext unrelated to the issue of price comparisons
between the Indian and Chinese fasteners, cannot be considered as informati on that the two Chinese
producers requested as relevant to the presen tation of their cases regarding the dumping
determination. Therefore, we do not consider that the Panel erred in not relying on the evidence
concerning Jiaxing Association's submission in making its finding under Article 6.4.
505. In sum, we consider that the product ty pes used by the Commission for purposes of
comparing the export price and normal value in th e fasteners investigation constituted "information
relevant to the presentation" of the Chinese parties' case. This is because, without such information,
"it would be difficult if not impossible, for foreign producers to request adjustments that they consider

722European Union's appellant's submission, para. 288.
723Jiaxing Association of Fasteners Import & Export Companies, Submission of 22 February 2008
(Panel Exhibit EU-13), p. 4. The two Chinese producers requesting clarification regarding product types were
not part of this association.
724European Union's appellant's submission, para. 288 (referring to Panel Report, para. 7.492).

necessary in order to ensure a fair comparison."
725 We further consider that the Panel correctly found
that the European Union violated Article 6.4 of the Anti-Dumping Agreement "by not providing a
timely opportunity for Chinese producers to see information regarding the product types on the basis
of which normal value was established". 726 We therefore decline to accept the European Union's
appeal of these findings.
506. With regard to the Panel's finding under Article 6.2 of the Anti-Dumping Agreement , the
European Union maintains that, because it has demons trated that the Panel's finding under Article 6.4
was flawed, the Panel's "purely consequential" finding under Article 6.2 was also in error. 727 In the
light of our finding that the Panel did not err in reaching its finding under Article 6.4, we also disagree
with the European Union's assertion that the Panel's finding under Article 6.2 was in error.
507. The European Union further submits that the firs t sentence of Article 6.2, which provides that
all interested parties "shall have a full opportunity fo r the defence of their interests", cannot "be read
as a catch-all due process provision" because doing so "would effectively render redundant all of the
other provisions of Article 6 which impose speci fic obligations on investigating authorities". 728 We
recall that, in the fasteners investigation, the Ch inese producers could not make relevant requests for
adjustment in order to ensure a fair comparison within the meaning of Article 2.4 of the Anti-Dumping
Agreement, because they were not informed, in a tim ely manner, of the basis on which the export
price and normal value was compared. Consequently , they did not have a full opportunity to defend
their interests in relation to the Commission's dumping determination. Thus, contrary to the
European Union's assertion, the Panel did not simp ly treat Article 6.2 as a "catch-all due process
provision". Rather, the Panel's finding is consiste nt with the Appellate Body's interpretation, in EC –
Tube or Pipe Fittings , that the "presentations" referred to in Article 6.4 "logically are the principal
mechanisms through which an exporter subject to an anti-dumping investigation can defend its
interests" within the meaning of Article 6.2. 729 On this basis, we consider that the Panel properly
found that "the Chinese exporters c ould not defend their interests in this investigation because the
Commission only provided information concerning the product types used in the determination of the
normal value at a very late stage of the proceedings " and that, therefore, "the European Union acted
inconsistently with Article 6.2" of the Anti-Dumping Agreement.730

725Panel Report, para. 7.491.
726Panel Report, para. 7.494.
727European Union's appellant's submission, para. 275.
728European Union's appellant's submission, para. 277. (original emphasis)
729Appellate Body Report, EC – Tube or Pipe Fittings, para. 149.
730Panel Report, para. 7.495.

E. China's Other Appeal of the Panel's Findi ngs under Article 2.4 of the Anti-Dumping
Agreement
508. China alleges that the Panel erred in finding th at the European Union did not fail to conduct a
fair comparison between the export price and normal value within the meaning of Article 2.4 of the
Anti-Dumping Agreement . Specifically, China asserts that the Panel erred in not addressing a
"substantial argument" 731 that China raised on the basis of th e last sentence of Article 2.4, which
requires that the authorities indicate to the parti es what information is necessary to ensure a fair
comparison. China also contends that the Panel's fa ilure to address its arguments is inconsistent with
a correct interpretation and application of Article 2.4. 732 China therefore requests the Appellate Body
to complete the analysis by applying Article 2.4 to the facts, and to find th at the Commission's failure
to indicate to the Chinese producers the information necessary to ensure a fair comparison constituted
a violation of Article 2.4 of the Anti-Dumping Agreement .733 Furthermore, China alleges that the
Panel erred in its interpreta tion of Article 2.4 of the Anti-Dumping Agreement , and acted
inconsistently with Article 11 of the DSU, when finding that the Commission did not have to make
adjustments for the physical differences reflected in the PCN characteristics. Finally, China maintains
that the Panel erred in its interpretati on and application of Article 2.4 of the Anti-Dumping Agreement
when finding that the Commission did not have to make adjustments for quality differences. 734 We
turn now to address each of these claims.
509. China alleges that, contrary to its duty under Article 11 of the DSU, the Panel failed to
address "one of China's main arguments concerning its claim of violation of Article 2.4" of the
Anti-Dumping Agreement, that is, the argument with regard to the Commission's failure to inform the
interested parties of the "product types" on the b asis of which the comparison was made between the
normal value and export price. 735 We note that, in its first written submission to the Panel, China
maintained that the Commission fa iled to disclose "the list of product types on the basis of which
normal value had been determined and how these produc t types had been compared with the PCNs of
the Chinese exporting producers" 736, although China did not specifically refer to the last sentence of
Article 2.4. In its second written submission, China, fo r the first time before the Panel, referenced the
last sentence of Article 2.4 and argued that, because the Commission failed to indicate to the parties in

731China's other appellant's submission, para. 306.
732Although China's other appellant's submission allege s that the Panel erred in its interpretation (see
para. 296), China clarified at the oral hearing that its cl aim also covers the Panel's application of Article 2.4 to
the facts of the case.
733See China's other appellant's submission, paras. 315-334.
734Although China's other appellant's submission allege s that the Panel erred in its interpretation (see
paras. 296 and 367), China clarified at the oral hearing that its claim also covers the Panel's application of
Article 2.4 to the facts of the case.
735China's other appellant's submission, para. 311.
736China's first written submission to the Panel, para. 372.

question what information was nece ssary to ensure a fair comparis on, the European Union violated
Article 2.4.
737
510. The Panel did not address this argument in its findings under Article 2.4 of the Anti-Dumping
Agreement. Regarding China's request during the interi m review stage that the Panel address this
argument, the Panel responded:
With respect to China's concern that the Panel failed to address its
argument that, by failing to info rm the Chinese producers of its
decision not to base the dumping determinations on full PCNs, the
European Union violated Article 2.4 of the [ Anti-Dumping
Agreement], we recall that this is the main argument China raises in
connection with its claim under Articles 6.2, 6.4, 6.5 and 6.9 of the
[Anti-Dumping Agreement ], which is addressed in the Report at
paragraphs 7.477-7.483.
738
511. The above review of China's arguments before the Panel indicates that China did not raise a
separate claim under the last sentence of Article 2.4, but referred to that sentence in support of its
claim that the Commission acted inconsistently with the obligation to conduct a fair comparison under
Article 2.4 of the Anti-Dumping Agreement. On appeal, China has also characterized its allegation
under the last sentence of Article 2.4 as an "argument put forward by China". 739 Thus, we disagree
with China's view that the Panel's failure to a ddress this argument constitutes "a false exercise of
judicial economy"740, because the issue of judicial economy is only relevant to the manner in which a
panel deals with a party's claims. Moreover, as the Appellate Body has found, a panel has the
discretion "to address only those arguments it deems necessary to resolve a particular claim" and "the
fact that a particular argument relating to that cl aim is not specifically addressed in the 'Findings'
section of a panel report will not, in and of itself, le ad to the conclusion that that panel has failed to
make the 'objective assessment of the matter before it' required by Article 11 of the DSU".741
512. Although the Panel's failure to address China' s argument does not rise to the level of a
violation of Article 11 of the DSU, we nonetheless consider that, in the light of its findings under
Article 6.4 of the Anti-Dumping Agreement, the Panel should have considered China's argument under
the last sentence of Article 2.4 of the Anti-Dumping Agreement in reaching its finding. As discussed
above, Article 2.4 obliges investigating authorities to indicate to the parties what information is
necessary to ensure a fair comparison and requires an investigating authority, at a minimum, to inform
the parties of the products or product groups used for purposes of the price comparison. This will

737China's second written submission to the Panel, paras. 778-787 and 796.
738Panel Report, para. 6.98.
739China's other appellant's submission, para. 306.
740China's other appellant's submission, para. 312.
741Appellate Body Report, EC – Poultry, para. 135. (emphasis omitted)

then allow the parties to decide whether a request for adjustment regarding any differences affecting
price comparability should be made.
513. We recall that, in the fasteners investigation, the structure of the questionnaire sent to the
Chinese producers suggested that requests for adjustments woul d not be necessary because of the
categorization of the product under investiga tion according to PCN groups. However, the
Commission decided to use a different method of product grouping to conduct the comparison,
namely, the "product types" defined on the basis of strength class and the distinction between standard
and special fasteners. As noted above, significant differences existed between PCNs and the "product
types" defined by the Commission. Had the Ch inese producers known that these product types were
used instead of PCNs, such differences could have prompted the Chinese producers to request
adjustments within the meaning of Article 2.4. In this respect, the Panel correctly found, in its
analysis under Article 6.4, that, without knowing wh at "product types" were used by the Commission,
"it would be difficult if not impossible, for foreign producers to request adjustments that they consider
necessary in order to ensure a fair comparison." 742 Thus, the facts of the case indicate that, because
the Commission did not clearly indicate the produc t types used for purposes of price comparisons
until very late in the proceedings, the European Un ion acted inconsistently with its obligations under
Article 2.4 by depriving the Chinese producers of th e ability to request adjustments for differences
that could have affected price comparability.
514. The Panel found, however, that the European Uni on acted consistently with Article 2.4 of the
Anti-Dumping Agreement . In so finding, the Panel analyzed China's claim under Article 2.4 in
isolation from its analysis under Article 6.4 of th at Agreement. Specifically, in disagreeing with
China's argument that the Commission should have ma de adjustments for differ ences reflected in the
PCN codes, the Panel stated that, "in the course of the investigation at issue, none of the Chinese
producers argued that there were factors which aff ected price comparability within the meaning of
Article 2.4 other than those used by the Comm ission to categorize the product for comparison
purposes, that is, strength class (which was an element of the PCNs) and the distinction between
standard and special fasteners (which was not an element of the PCNs)".
743 The Panel further stated
that, "[g]iven the absence of su ch a request [for adjustments for differences affecting price
comparability] from the Chinese exporters, and any showing that there was a factor which affected

742Panel Report, para. 7.491.
743Panel Report, para. 7.306.

price comparability which should have been appa rent to the Commission", China's claim was
unfounded and must be rejected.
744
515. Yet, as the Panel found in the context of Article 6.4, "[i]n a case such as this one, where it
appears from the structure of the questionnaires th at such requests will not be necessary because of
the categorization of the product according to PCN groups, we consider that it is not unreasonable for
exporters to not request specific adjustments which are already reflected in those PCN groups ."745
The Panel further found that "Chinese producers were informed very late in the proceedings of the
product types that formed the basis for the comparisons underlying the Commission's dumping
determinations."
746 Thus, because of the Commission's failure to provide a timely opportunity to see
the information concerning the basis of the pric e comparisons, the Chinese producers were precluded
from requesting any adjustments for purposes of ensuring a fair comparison. The "absence" 747 of a
request from the Chinese producers for adjustments on th e basis of the PCN characteristics, therefore,
should not have prevented a finding of inconsistency under Article 2.4. On the contrary, it further
demonstrates that, due to the Commission's failure to indicate what information was necessary for a
fair comparison, the Chinese producers were unable to exercise their rights under Article 2.4 to ensure
that the Commission conducted a fair comparison of th e export price and the normal value. Thus, in
failing to consider the last sentence of Article 2.4 in the light of the relevant facts of the case and its
finding under Article 6.4, the Panel erred in its application of Article 2.4 of the Anti-Dumping
Agreement.
516. China further maintains that the Panel erred in the interpretation of Article 2.4 of the
Anti-Dumping Agreement by failing to distinguish between tw o obligations encompassed under that
provision: first, the obligation for an investigati ng authority to evaluate identified differences that
might affect price comparability; second, the obligation of the authority to make adjustments if it
finds that the differences indeed affected price comp arability. In this dispute, China argues, because
the Commission requested information on the basis of PCNs at the beginning of the investigation, the
physical characteristics indicated in th e PCNs were identified by the Commission.
748 Thus, even in
the absence of a request, the Commission should ha ve evaluated whether any of the identified
differences could have had an impact on the prices compared.
517. The Panel, quoting the panel's finding in EC – Tube or Pipe Fittings , found that the
investigating authorities "must take steps to achieve clarity as to the adjustment claimed and whether

744Panel Report, para. 7.306.
745Panel Report, para. 7.491. (emphasis added)
746Panel Report, para. 7.492.
747Panel Report, para. 7.306.
748China's other appellant's submission, para. 360.

and to what extent that adjustment is merited". 749 Logically, as a step "to achieve clarity as to the
adjustment claimed", authorities must first evaluate the differences identified to assess whether they
affect price comparability. Therefore, we do not cons ider that the Panel's interpretation of Article 2.4
differs from China's view that an investigating auth ority must evaluate identified differences and then
make adjustments.750 We are less convinced, however, by China's assertion that the authority must
evaluate any identified differences, regardless of wh ether a request for adjustment has been made. It
is likely that, in an anti-dumping investigation, the differences between the products sold in the
foreign producer's domestic and export markets would be numerous. Di fferences between the
products, however, would not alwa ys affect price comparability a nd require adjustments by the
authorities. China's assertion may place an undue bur den on an investigating authority to assess each
difference in order to determine whether adjustment is needed in every case, even without a request
by the interested party.
518. China further argues that the Panel failed to c onduct an objective assessment of the facts, as
required by Article 11 of the DSU, in finding that China did not provide evidence in support of its
claim that the PCN characteristics nece ssarily affected price comparability.
751 In addition, according
to China, the Panel acted inconsistently with Article 17.6(i) of the Anti-Dumping Agreement when it
found that, because the Commission did not conclude that the PCN characteristics indicated
differences affecting price comparability, it was ina ppropriate for the Panel to consider this issue
itself.
752 China requests the Appellate Body to comple te the analysis and find that "an unbiased and
objective investigating authority in this situation could only have concluded that such adjustments had
to be made."753
519. We emphasize that our finding above, that the Panel failed properly to apply Article 2.4 of the
Anti-Dumping Agreement , does not suggest that the PCN characteristics necessarily reflect
differences that affect price comparability. Neither does it suggest that the Commission, had it
examined the characteristics, would have made adju stments. Rather, the authorities "must take steps
to achieve clarity as to the adjustment claimed and then determine whether and to what extent that
adjustment is merited". 754 Thus, it is the investigating authority's duty to review the requested
adjustments in order to determine whether any physi cal differences identified before it are differences
that affect price comparability within the meaning of Article 2.4.

749Panel Report, para. 7.298 (quoting Panel Report, EC – Tube or Pipe Fittings, para. 7.158).
750See also European Union's appellee's submission, para. 272.
751See China's other appellant's submission, para. 383.
752See China's other appellant's submission, para. 386. See also Panel Report, para. 7.302.
753China's other appellant's submission, para. 400.
754Panel Report, EC – Tube or Pipe Fittings, para. 7.158.

520. In this dispute, because the Chinese producers were not able to claim adjustments, the
Commission did not examine the issue of whether an y of the PCN characteristics, when compared to
the product types used to establish the normal value, were differences that affect price comparability.
The numerous PCN characteristics were thus not co mpared with the product types chosen by the
Commission and discussed for purposes of price comparison. In this context, it was therefore
reasonable for the Panel to state that, "while it may be plausible that the PCN characteristics described
in this case indicate differences affecting price comparability"
755, there is no evidence on the Panel
record that would support this conclusion. Mo reover, it was the Commission's duty to review any
requested adjustments to determine whether the re quest would be warranted. As the Panel rightly
found, absent any discussion during the investigation at issue, it was not appropriate, nor feasible, for
the Panel to assume the role of an investigating authority and analyze the differences between each of
the narrowly defined PCN characteristics a nd the product types used by the Commission. 756
Similarly, it is not within our mandate to revi ew whether the various PCN characteristics reflect
physical differences that would have affected price comparability in the fasteners investigation, in the
absence of any factual findings in this regard by the Commission or by the Panel. Therefore, we
decline to accept China's claim that the Panel acted inconsistently with Article 11 of the DSU, or
Article 17.6(i) of the Anti-Dumping Agreement, and, consequently, we also decline China's request for
completion of the analysis.
521. Finally, China alleges that the Panel erred in its interpretation and application of Article 2.4 of
the Anti-Dumping Agreement in disagreeing with China's argument that the European Union violated
that provision because the Commission failed to evaluate, and make adjustments for, quality
differences757 between Indian and Chinese fasteners, ev en though China demonstrated to the Panel
that one Chinese producer requested such an adjustment.758 According to China, the Commission was
under a duty at least to evaluate the claimed diffe rences in quality between the Indian and Chinese
products. Moreover, because "the quality differen ces affected price comparability, the Commission
was required to make the necessary adjustments".759

755Panel Report, para. 7.302. The Panel recalled that the PCN characteristics were: type of fasteners
(by CN code); strength/hardness; coating; presence of chrome on coating; diameter; and length/thickness.
(Ibid., footnote 617 to para. 7.302)
756See Panel Report, para. 7.302.
757We recall that quality is not one of the characteristics identified in the PCNs.
758China's other appellant's submission, paras. 405 and 406.
759China's other appellant's submission, para. 408.

522. In reaching the finding challenged by China, the Panel noted China's assertion that, at
recital 52 of the Definitive Regulation, the Comm ission "acknowledged" that there were quality
differences between Indian and Chinese fasteners.760 Recital 52 states, in relevant part:
The submission from the PRC authorities mentioned in recital 48
enclosed an analysis report de tailing alleged qua lity differences
between fasteners of a given standard (DIN 933 is used as an
example) manufactured in the Community and the PRC. … Any
perceived differences in quality, which may subsist from a user's
point of view, can be dealt with through an adjustment for physical
differences (see recital 103) but do not mean that the two products
are not comparable.
523. In reviewing recital 52, the Panel found that China's argument was based on a misreading of
that recital. Specifically, the Panel found that "r ecital 52 relates to the issue of like product, not
dumping determinations", and that "it refers to an analysis of differences between fasteners produced
in China, and fasteners produced in the European Union", which China alleged in support of its
argument that Chinese and EU fasteners are not comp arable, and therefore should not be considered
"like".
761 Furthermore, the Panel noted that "China's argument seem[ed] to rest on the premise that
the Commission stated in recital 52 that any perceived quality differences would be dealt with through
adjustments, and that therefore such adjustments should have been made." 762 The Panel observed,
however, "that recital 52 says that any perceived di fferences in quality can be dealt with through
adjustments", and "it is clear th at this recital does not even ad dress any differences between Indian
and Chinese fasteners."763 On the basis of its review, therefore, the Panel concluded:
Thus, despite the reference to recital 103 [in recital 52], where the
Commission explains the adjustment made for differences in the cost
of quality control between Indian and Chinese producers, we do not
see what relevance recital 52 has to the issue raised by China, that the
Commission should have made an adjustment for quality differences
between Chinese and Indian fasteners.
764
524. On appeal, although China claims that the Panel erred in its interpretation and application of
Article 2.4 of the Anti-Dumping Agreement in finding that the Commission was not required to make
adjustments for quality differences, it does not provi de any specific argument that addresses such an
error in legal interpretation. Rather, China's appeal hinges on its disagreement with the Panel
concerning the meaning and scope of the above recital in the Definitive Regulation. In our view, the
Panel's finding, that recital 52 of the Definitive Regulation did not support the view that the

760Panel Report, para. 7.307.
761Panel Report, para. 7.308.
762Panel Report, para. 7.309 (referring to China's response to Panel Question 94). (original underlining)
763Panel Report, para. 7.309. (original underlining)
764Panel Report, para. 7.309.

Commission acknowledged quality differences between Indian and Chinese fasteners, was based on a
reasoned analysis of the text of the measure at is sue. As the Panel correctly found, recital 52 "does
not even address any differences between Indian and Chinese fasteners".
765 Moreover, China has not
identified any specific differences in quality th at had been identified during the fasteners
investigation. We therefore see no basis for Chin a's argument that Recital 52 of the Definitive
Regulation demonstrates that these quality differences were "identified".766
525. China further argues that it submitted to the Pane l a letter sent by the Commission in reply to
questions by certain Chinese exporters, in which th e Commission stated that "[p]hysical differences
are addressed by … adjustment for the cost of quality control which reflects the general difference in
quality level."767 China maintains that this letter demons trated that the Commission was aware of a
"general difference in quality level".768
526. The Panel dismissed the relevance of the letter, finding that "nothing in this letter indicates
that any evidence was proffered to the Commission to demonstrate that this alleged difference in
quality affected price comparability", and that the letter did not clearly show that the Commission
acknowledged that there were quality diffe rences affecting price comparability. 769 In our view, the
Panel's finding is properly premised on the content of the letter. The letter clearly shows that it
concerns adjustments for "cost of quality control" rather than any differences in quality of the
fasteners by Chinese and Indian producers. More over, on appeal, China did not raise any claims
under Article 11 of the DSU alleging that the Pane l's above review of a piece of evidence submitted
by China was inconsistent with its obligation to condu ct an objective assessment of the facts. Thus, it
is not for us to second-guess the Panel's conclusion on the basis of its assessment of this evidence.
We consider, therefore, that China's claim is not properly substantiated and should therefore be
dismissed. Consequently, China's allegation that the Commission should have made adjustments for
such "acknowledged" differences in quality also cannot stand.770
F. Conclusion
527. In sum, with respect to the Panel's findings on certain aspects of the dumping determination,
we find that the Panel correctly found that the Eu ropean Union violated Article 6.4 of the
Anti-Dumping Agreement "by not providing a timely opportunity for Chinese producers to see

765Panel Report, para. 7.309.
766China's other appellant's submission, para. 412.
767China's other appellant's submission, para. 413 (quoting Panel Exhibit CHN-31, supra, footnote 310,
point 5).
768China's other appellant's submission, para. 414.
769Panel Report, para. 7.311.
770China's other appellant's submission, para. 418.

information regarding the product types on the basis of which normal value was established". 771 The
Panel also correctly found that, in view of the Commission's failure to disclose the information on the
product types on a timely basis, the European Un ion denied the Chinese producers a "full opportunity
for the defence of their interests", in violation of Article 6.2 of the Anti-Dumping Agreement.772 We
further find that, in failing to take into account the last sentence of Article 2.4 in the light of the
relevant facts of the case and its finding under Article 6.4 of the Anti-Dumping Agreement, the Panel
erred in its application of Article 2.4 of that Agreement. We find, instead, that, in not disclosing the
information on the product types on a timely basis, the European Union acted inconsistently with
Article 2.4 of the Anti-Dumping Agreement by failing to indicate to the parties in question what
information was necessary to ensure a fair comparison.
528. However, we do not find that the Panel erred in its interpretation of Article 2.4 of the
Anti-Dumping Agreement by failing to distinguish between an investigating authority's obligation to
evaluate identified differences that might affect pr ice comparability, and to make adjustments if it
finds that the differences indeed affected price comp arability. Neither do we find that the Panel acted
inconsistently with Article 11 of the DSU or Article 17.6 of the Anti-Dumping Agreement in finding
that the Commission was not required to make adjust ments for the physical differences between the
characteristics reflected in the PCNs a nd the product types. Finally, we find that the Panel did not err
in the interpretation and application of Article 2.4 of the Anti-Dumping Agreement in rejecting China's
argument that the Commission acted inconsistently with that provision by failing to evaluate, and to
make adjustments for, quality differences.
VIII. Confidential Treatment and the Disclosure of Information under Articles 6.5 and 6.5.1
and Articles 6.2 and 6.4 of the Anti-Dumping Agreement
A. Introduction
529. We will now turn to the participants' various appeals regarding the Commission's treatment of
confidential information under Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement , and the
disclosure of information under Articles 6.2 and 6.4 of the Anti-Dumping Agreement.
530. According to Article 6.5 of the Anti-Dumping Agreement , information that is "by nature"
confidential or that is "provided on a confidential basis" shall, upon "good cause" shown, be treated as
such by the investigating aut horities. Article 6.5.1 of the Anti-Dumping Agreement requires that
parties submitting confidential information also furnish a non-confidential summary thereof, in
sufficient detail to permit a reasonable understanding of the substance of the information submitted in

771Panel Report, para. 7.494.
772Panel Report, para. 7.495.

confidence. In exceptional circumstances, parties may indicate that confidential information is not
susceptible of summary, and a statement of the reasons why summarization is not possible must be
provided.
531. The participants raise on appeal several issues under Articles 6.5 and 6.5.1. We will address
first the European Union's appeal of the Panel's fi nding that the European Union acted inconsistently
with Article 6.5.1 because two domestic producers
773 provided insufficient statements of the reasons
why they could not provide non-confidential summari es of information submitted in confidence. The
European Union claims on appeal that Article 6.5.1 does not require investigating authorities to
ensure that producers provide "appropriate" stat ements of the reasons why summarization is not
possible, because, in the European Union's view , this provision imposes only a "best endeavours"
obligation on investigating authorities.
532. Next, we will address the European Union's second claim under Article 6.5 regarding the
confidential treatment of the "product type" info rmation submitted by the analogue country producer,
whose data the Commission used for the determination of normal value in lieu of Chinese domestic
prices. We begin by addressing the European Unio n's preliminary objection that this claim was not
within the Panel's terms of reference, and that the Panel's consideration and ruling on this claim
deprived the European Union of its due process right s. Then, we will address the issue raised by the
European Union as to whether the requirement in Article 6.5 to show "good cause" for confidential
treatment applies to an analogue country producer not designated as an "interested party" under
Article 6.11 of the Anti-Dumping Agreement.
533. We will then turn to the claims raised by Ch ina in its Notice of Other Appeal regarding the
Panel's finding that "potential commercial retaliati on" justified the confidential treatment of the
identity of the complainants and supporters of the co mplaint. China claims that the complainants did
not make a sufficient "good cause" showing for treating the identity of the complainants and
supporters as confidential, and that the Panel erred in both its application of the burden of proof and in
its rejection of China's argument that the Commissi on's disclosure of the co mplainants' identity in
another context undermined the "good cause" alleged.
534. Finally, we will address the European Union's appeal under Article 6.2 of the DSU that the
Panel erred in finding that China's claims under Articles 6.2 and 6.4 of the Anti-Dumping Agreement
challenging the non-disclosure of the identity of the complainants and supporters were within the
Panel's terms of reference, despite the lack of an explicit reference in the panel request to China's

773EU producers A. Agrati S.p.A. and Fontana Luigi S.p.A.

claim regarding the non-disclosure of the id entity of the complainants and supporters. 774 Since in
China's view no "good cause" was shown under Article 6.5 to treat the identity of the complainants
and the supporters of the complaint as confidential, China claimed that the non-disclosure of their
identity to the Chinese exporters and producers was inconsistent with the transparency and due
process requirements of Articles 6.2 and 6.4. The European Union contends on appeal that China's
claims under Articles 6.2 and 6.4 with respect to the non-disclosure of the identity of the complainants
were not within the Panel's terms of reference because they were not included in the panel request.
B. Confidential Treatment of Information under Articles 6.5 and 6.5.1 of the
Anti-Dumping Agreement
535. We begin with an interpretation of Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement .
Articles 6.5 and 6.5.1 set out specific rules govern ing an investigating authority's acceptance and
treatment of confidential information. The provisions read as follows:
6.5 Any information which is by nature confidential (for example,
because its disclosure would be of significant competitive
advantage to a competitor or b ecause its disclosure would have
a significantly adverse effect upon a person supplying the
information or upon a person fro m whom that person acquired
the information), or which is provided on a confidential basis
by parties to an investigation shall, upon good cause shown, be
treated as such by the authorities. Such information shall not
be disclosed without specific permission of the party
submitting it.
6.5.1 The authorities shall require interested parties providing
confidential information to furnish non-confidential
summaries thereof. These summaries shall be in
sufficient detail to permit a reasonable understanding of
the substance of the information submitted in
confidence. In exceptional ci rcumstances, such parties
may indicate that such information is not susceptible of
summary. In such exceptional circumstances, a
statement of the reasons why summarization is not
possible must be provided.
536. Under Article 6.5, authorities must treat info rmation submitted by parties to an investigation
as confidential if it is "by nature" confidential, or if it is "provided on a confidential basis" and
"upon good cause shown". The confidentiality of in formation that is "by nature" confidential will
often be readily apparent. Article 6.5 provides illust rative examples of information that falls into the
category of "by nature" confidential, including info rmation that is sensitive "because its disclosure

774We recall that Article 6.2 of the Anti-Dumping Agreement provides that interested parties be given a
full opportunity to defend their interests throughout an i nvestigation. Article 6.4 in turn requires that the
authorities provide timely opportunities for interested parties to see all non-co nfidential information relevant to
the presentation of their cases. (See supra, paras. 478 and 507)

would be of significant competitive advantage to a competitor or because its disclosure would have a
significantly adverse effect upon a person supplying the information or upon a person from whom that
person acquired the information". One type of such information is commercially sensitive
information not typically disclosed in the normal course of business, and which would likely be
regularly treated as confidential in anti-dumping investigations.
775 The question of whether
information is "by nature" confidential depends on the content of the information. Information that is
"provided on a confidential basis" is not necessarily confidential by reason of its content, but rather,
confidentiality arises from the circumstances in whic h it is provided to the authorities. These two
categories may, in practice, overlap.
537. The requirement to show "good cause" for confid ential treatment applies to both information
that is "by nature" confidential and that which is provided to the authority "on a confidential basis". 776
The "good cause" alleged must constitute a reason suffi cient to justify the withholding of information
from both the public and from the other parties inter ested in the investigation, who would otherwise
have a right to view this information under Article 6 of the Anti-Dumping Agreement. Put another
way, "good cause" must demonstrate the risk of a potential consequence, the avoidance of which is
important enough to warrant the non- disclosure of the information. "Good cause" must be assessed
and determined objectively by the investigating aut hority, and cannot be determined merely based on
the subjective concerns of the submitting party.
538. We find that the examples provided in Article 6.5 in the context of information that is
"by nature" confidential are helpful in interpreting "good cause" generally, because they illustrate the
type of harm that might result from the disclosur e of sensitive information, and the protectable
interests involved. Article 6.5 states that the discl osure of such information "would be of significant
competitive advantage to a competitor" or "would have a significantly adverse effect upon a person
supplying the information or upon a person from whom that person acquired the information". These
examples suggest that a "good cause" which could justify the non-disclosure of confidential
information might include an advantage being best owed on a competitor, or the experience of an
adverse effect on the submitting party or the part y from which it was acquired. These examples are
only illustrative, however, and we consider that a wide range of other reasons could constitute
"good cause" justifying the treatment of information as confidential under Article 6.5.

775This could be the case, for example, for certain profit or cost data or proprietary customer
information.
776See Panel Report, para. 7.451; Panel Report, Korea – Certain Paper, para. 7.335; and Panel Report,
Guatemala – Cement II, para. 8.219.

539. In practice, a party seeking confidential treatment for information must make its "good cause"
showing to the investigating authority upon submi ssion of the information. The authority must
objectively assess the "good cause" alleged for conf idential treatment, and scrutinize the party's
showing in order to determine whether the submitting party has sufficiently substantiated its request.
In making its assessment, the investigating author ity must seek to balance the submitting party's
interest in protecting its confidential information 777 with the prejudicial effect that the non-disclosure
of the information may have on the transparency a nd due process interests of other parties involved in
the investigation to present their cases and defend thei r interests. The type of evidence and the extent
of substantiation an authority must require will depe nd on the nature of the information at issue and
the particular "good cause" alleged. The obligati on remains with the investigating authority to
examine objectively the justification given for the n eed for confidential treatment. If information is
treated as confidential by an authority without such a "good cause" showing having been made, the
authority would be acting inconsistently with its ob ligations under Article 6.5 to grant such treatment
only "upon good cause shown".
540. In examining the scope of Article 6.5, we note that it extends the need to request confidential
treatment to information submitted by "parties to an i nvestigation" rather than those in the specifically
defined group of "interested parties". As such, Article 6.5 does not limit the protection afforded to
sensitive information to the "interested parties" expressly listed under Article 6.11 of the
Anti-Dumping Agreement.
778 In our view, the term "parties to an investigation" refers to any person
who takes part or is implicated in the investigation. 779 Moreover, Article 6.11 does not contain an
exhaustive list of "interested parties", but states that "'interested parties' shall include" the persons or
groups listed in that Article. In our view, the pe rsons expressly listed in Article 6.11 are those who
are in every case considered to be "interested pa rties", but are not the only persons who may be
considered "interested parties" in a particular inves tigation. We do not believe that an investigating

777Where necessary, the authority must also consider the submitting party's relationship with the source
of the confidential information.
778Article 6.11 of the Anti-Dumping Agreement reads:
For the purposes of this Agreement, "interested parties" shall include:
(i) an exporter or foreign producer or the importer of a product subject to
investigation, or a trade or business association a majority of the members of
which are producers, exporters or importers of such product;
(ii) the government of the exporting Member; and
(iii) a producer of the lik e product in the importing Member or a trade and
business association a majority of the members of which produce the
like product in the territory of the importing Member.
This list shall not preclude Members from allowing domestic or foreign
parties other than those mentioned above to be included as interested parties.
779The panel in Argentina – Poultry Anti-Dumping Duties analyzed a similar term in Article 6.1.2 of the
Anti-Dumping Agreement, that is, "other interested parties particip ating in the investigation", and developed a
similar interpretation of this term. (Panel Report, Argentina – Poultry Anti-Dumping Duties, para. 7.153)

authority is relieved of its obligations under Ar ticle 6.5 merely because a participant in the
investigation does not appear on the list of "interested parties" in Article 6.11.
780 Rather, once
"good cause" is shown, confidential treatment of se nsitive information must be afforded to any party
who takes part or is implicated in the investigation or in the provision of information to an authority.
Pursuant to Article 6.5 such parties include pe rsons supplying information, persons from whom
confidential information is acquired, and parties to an investigation.
541. Whenever information is treated as confidential, transparency and due process concerns will
necessarily arise because such treatment entails th e withholding of information from other parties to
an investigation. Due process requires that inte rested parties have a right to see the evidence
submitted or gathered in an inves tigation, and have an adequate oppor tunity for the defence of their
interests.781 As the Appellate Body has stated, "that opportunity must be meaningful in terms of a
party's ability to defend itself".782
542. Articles 6.5 and 6.5.1 accommodate the concerns of confidentiality, transparency, and due
process by protecting information that is by nature confidential or is submitted on a confidential basis
and upon "good cause" shown, but establishing an alternative method for communicating its content
so as to satisfy the right of other parties to the investigation to obtain a reasonable understanding of
the substance of the confidential information, and to defend their interests. As the Panel found,
"Article 6.5.1 serves to balance the goal of ensuring that the availability of confidential treatment does
not undermine the transparency of the investigative process". 783 In respect of information treated as
confidential under Article 6.5, Article 6.5.1 obliges the investigating authority to require that a
non-confidential summary of the information be furnis hed, and to ensure that the summary contains
"sufficient detail to permit a reas onable understanding of the substance of the information submitted

780We note, in this respect, the European Union's argument that the "good cause" requirement for
confidential treatment of information in Article 6.5 does not apply to analogue country producers like
Pooja Forge, because they do not fall within the definition of "interested parties" under Article 6.11 of the
Anti-Dumping Agreement . (European Union's appellant's submission, paras. 349-354) In the fasteners
investigation, the Commission did not determine normal value on the basis of the information from Chinese
producers and exporters, and decided to seek inform ation from analogue country producers. The Indian
company Pooja Forge participated in the investigation at the request of the Commission, and provided
substantial amounts of information that was used as the basis for determining normal value. In our view, the
decision by the Commission to determine normal value based on information from an analogue country
producer, and the participation of Pooja Forge in the investigation, require that Pooja Forge be afforded the
protection of sensitive information upon "good cause" show n and the obligations of both Articles 6.5 and 6.5.1
apply.
783Panel Report, para. 7.515.

in confidence".784 The sufficiency of the summary provid ed will therefore depend on the confidential
information at issue, but it must permit a reasonable understanding of the substance of the information
withheld in order to allow the other parties to the investigation an opportunity to respond and defend
their interests.
543. Article 6.5.1 contemplates that in "exceptiona l circumstances" confidential information may
not be "susceptible of summary". In such excep tional circumstances, a party may indicate that it is
not able to furnish a non-confidential summary of the information submitted in confidence, but it is
nevertheless required to provide a "statement of the reasons why summarization is not possible".
Article 6.5.1 relieves a party of its duty to provide a non-confidential summary of information
submitted in confidence only if doing so "is not possibl e". It is not enough for a party simply to claim
that providing a summary would be burdensome or co stly. Summarization of information will not be
possible where no alternative method of presenting that information can be developed that would not,
either necessarily disclose the sensitive information, or necessarily fail to provide a sufficient level of
detail to permit a reasonable unde rstanding of the substance of the information submitted in
confidence.
544. Where information is kept confidential upon " good cause" shown, and it is not possible to
provide a non-confidential summary of the informa tion that permits a reasonable understanding of its
substance, the balance struck under Articles 6.5 an d 6.5.1 is altered, and the due process rights of
other parties to the investigation are not fully respected. Therefore, when it is not possible to furnish a
non-confidential summary, Article 6.5.1 requires a party to identify the exceptional circumstances and
provide a statement explaining the reasons why summarization is not possible. For its part, the
investigating authority must scrutinize such st atements to determine whether they establish
exceptional circumstances
785, and whether the reasons given a ppropriately explain why, under the

784The panel in Mexico – Steel Pipes and Tubes made a similar finding:
We consider that the conditions set out in Article 6.5, chapeau, and 6.5.1 are
of critical importance in preserving th e balance between the interests of
confidentiality and the ability of another interested party to defend its rights
throughout an anti-dumping investigation. For precisely this reason, we
consider it paramount for an investigating authority to ensure that the
conditions in these provisions are fu lfilled. We consider it equally
important for a WTO Panel called upon to review an investigating
authority's treatment of confidential information strictly to enforce these
conditions, while remaining cognizant of the applicable standard of review.
(Panel Report, Mexico – Steel Pipes and Tubes, para. 7.380)
785The panel in Mexico – Olive Oil came to a similar conclusion in its interpretation of the parallel
provisions of the SCM Agreement, finding that:
… the investigating authority should examine the reasons given for not
summarizing the confidential information and determine whether, indeed,
these reasons constitute "exceptional" circumstances.
(Panel Report, Mexico – Olive Oil, para. 7.92)

circumstances, no summary that pe rmits a reasonable understanding of the information's substance is
possible.
786 As the Panel found, "in the absence of scru tiny of non-confidential summaries or stated
reasons why summarization is not possible by the i nvestigating authority, the potential for abuse
under Article 6.5.1 would be unchecked unless and until the matter were reviewed by a panel." 787
This "would obviously defeat the goal of maintaining transparency during the course of the
investigation itself that is one of the purposes of Article 6.5".
788 In sum, Article 6.5.1 imposes an
obligation on the investigating authorities to en sure that sufficiently detailed non-confidential
summaries are submitted to permit a reasonable unde rstanding of the substance of the confidential
information; and, in exceptional circumstances, to ensure that parties provide a statement
appropriately explaining the reasons why particul ar pieces of confidential information are not
susceptible of summary.
C. Domestic Producers' Statements of the Re asons Why Summarization of Confidential
Information Was Not Possible
545. We turn next to the European Union's appeal of the Panel's finding that the Commission
failed to ensure that two domestic producers complied with the requirements of Article 6.5.1 of the
Anti-Dumping Agreement, and thus the European Union acted inconsistently with that provision.789 In
the fasteners investigation, two domestic producers, A. Agrati S.p.A ("Agrati") and
Fontana Luigi S.p.A. ("Fontana Luigi"), submitte d a substantial amount of information to the
Commission on a confidential basis. As required by Article 6.5.1, each producer provided, in addition
to the non-confidential version of its questionnaire response, summaries for most of the information
submitted in confidence. For certain categories of information, however, no non-confidential
summaries were provided, and only limited statements were provided relating to the lack of such
summaries.
546. The Panel found that the statements provided by the two producers were not sufficient to
comply with the requirement under Article 6.5.1 that, in the exceptional circumstance in which
confidential information is not susceptible of summary, parties provide a statement of the reasons why
summarization is not possible. The Panel found that the statements submitted by these producers did
not "relate to any of the specific information fo r which no non-confidential summary [was] provided,

786We note that various methods of summarization are used by parties and investigating authorities in
anti-dumping investigations, such as indexing data, providing trends analysis, and aggregating data from
multiple producers. Where a certain method might be expected to be used for the specific type of information in
question, it would be incumbent on the submitting party to explain, inter alia , why present circumstances
prevent it from employing that method.
787Panel Report, para. 7.515.
788Panel Report, para. 7.515.
789Panel Report, paras. 7.516 and 7.517.

or to anything having to do with [the producer] itself, the party supplying it". 790 Specifically, the
Panel found that Agrati's statement simply asserte d that the confidential information could not be
summarized. The Panel further noted that, in certain cases, Agrati's assertion that it could not
summarize the information was undermined by the f act that other domestic producers were able to
produce summaries of the same types of information. 791 In the case of Fontana Luigi, the Panel found
that the producer did not even assert that the in formation was not susceptible of summary, but only
stated that the various questionnaire r esponses were "by nature confidential". 792 The Panel further
found that there was no evidence "that would even suggest that the Commission ever considered
whether [the producers'] stated reason for the l ack of a non-confidential summary of such
information … was more than pro forma", and concluded that the European Union thereby violated its
obligations under Article 6.5.1 to ensure that an appropriate statement of reasons was provided.793
547. On appeal, the European Union contends that Articles 6.5 and 6.5.1 impose only two
requirements on investigating authorities, that is, to treat information as confidential, upon good cause
shown, and to require parties to provide non-c onfidential summaries of information submitted in
confidence. The second, third, and fourth senten ces of Article 6.5.1 impose only a "best endeavours"
obligation on the investigating authority to ensu re that non-confidential summaries provided include
"sufficient detail to permit a r easonable understanding" of the underly ing information, or to require
that a statement of reasons be provided where summarization is not possible. 794 There is no basis, in
the European Union's view, for the Panel's finding th at investigating authorities must ensure that
parties provide "appropriate" non-confidential summar ies or "appropriate" statements of the reasons
why summarization is not possible. 795 According to the European Union, had the drafters intended
Article 6.5.1 to impose a strict obligation on inv estigating authorities in these respects, the provision
would have given authorities the power to pena lize non-compliance, for example, by disregarding
confidential information when no non-confidential summary, or no statement of reasons explaining
why summarization is not possible, is provided.796
548. In response, China submits that, as the Panel found, Article 6.5.1 entails a two-part obligation.
First, Article 6.5.1 obliges an investigating au thority to require non-confidential summaries of
confidential information, or, where applicable, st atements of the reasons why summarization is not
possible. Second, an investigating authority must further require that these summaries or statements

790Panel Report, paras. 7.516 and 7.517.
791Panel Report, para. 7.516.
792Panel Report, para. 7.517.
793Panel Report, paras. 7.516 and 7.517. (original emphasis)
794European Union's appellant's submission, para. 317.
795European Union's appellant's submission, paras. 298 and 321.
796European Union's appellant's submission, para. 319.

be "appropriate" to satisfy the requirements of Article 6.5.1.
797 In China's view, interpreting this
provision in a way that would allow less than "a ppropriate" summaries and statements would render
the obligation "useless", and would violate the interp retative principle that an interpreter should not
adopt a reading that reduces the provisions of a treaty "to redundancy or inutility".798
549. As we have found above, contrary to the Eur opean Union's contention, Article 6.5.1 imposes
an obligation on investigating authorities to ensure that parties to an investigation provide non-
confidential summaries in sufficien t detail to permit a reasonable understanding of the substance of
the information submitted in confidence; and, in the exceptional circumstances in which
summarization of confidential information is not possi ble, that statements be provided appropriately
explaining the reasons why this is so. 799 The European Union is correct that the Anti-Dumping
Agreement does not provide for specific sanctions to penalize parties if they fail to provide a sufficient
non-confidential summary or a statement of the r easons why summarization is not possible. The
Anti-Dumping Agreement places a number of obligations on investigating authorities to make a fair
and objective assessment of particular issues in ev ery investigation and to balance the rights and
obligations of the interested parties subject to that investigation, with limited power to impose
sanctions on a non-complying party. However, this does not derogate from the obligatory nature of
the requirements. It does not mean, as the Europ ean Union argues, that an investigating authority
must merely make best efforts to ensure that such summaries or statements of reasons are provided.
The obligation rests on the Members to comply with th e requirements of Article 6.5.1, and it is left to
each Member to determine how they will do so.
550. In this instance, the Panel found that the non-confidential version of the questionnaire
response submitted by Agrati cont ained non-confidential summaries of information submitted in
confidence relating to some injury factors, but not others. 800 For those where a non-confidential
summary was not provided, the following statement was included: "[t]he information cannot be
summarized without disclosing confidential informat ion which can cause a damage to our company.
The information has been provided as limited."801

798China's appellee's submission, paras. 524 and 527.
799See supra, paras. 542-544.
800Agrati included a non-confidential summary for em ployment, sales and re-sales of the subject
product, inventories, production, capacity and capacity utilization. No summary was provided for factors such
as return on investment, investments, profitability, cash fl ows, cost of production, suppliers of direct (raw)
materials, volume of raw materials used in production, extraordinary items with respect to costs, list of all sales
to unrelated domestic customers, and allocation of different cost elements among different types of products.
(See Panel Report, para. 7.516)
801Panel Report, para. 7.516.

551. In respect of the second domestic producer, F ontana Luigi, while the initial questionnaire
response contained "almost no non-confidential summar ized information regarding injury factors", a
follow-up response based on a specific request by the Commission contained non-confidential
summaries for the majority of the information submitted in confidence. 802 However, no summaries
were provided for information regarding distributi on systems and price settings. The reason given as
to why a summary could not be provided was simply th at "[the] information is by nature confidential
because its disclosure would be of significant competitive advantage to a Competitor."803
552. As we have found above, where a party clai ms that it cannot provide a non-confidential
summary of information submitted in confidence, Artic le 6.5.1 requires an investigating authority to
ensure that, in the exceptional circ umstances in which confidential in formation is not susceptible of
summary, a submitting party provide instead a stat ement appropriately expl aining the reasons why
summarization of that particular information is not possible. As we have also found, summarization
of confidential information will not be possi ble where no alternative method of presenting the
information can be developed that would not, either necessarily discl ose the sensitive information, or
necessarily fail to provide a sufficient level of detail to permit a reas onable understanding of the
substance of the information submitted in confidence.
553. Neither of the statements provided by Agrati or Fontana Luigi indicated why the information
for which no non-confidential summary was provide d presented an "exceptional circumstance" to
justify the lack of a summary, nor did either stat ement provide reasons explaining why summarization
of a particular category of information was not possible. With respect to Agrati, its statement
asserting for each category that "[t]he information cannot be summarized without disclosing
confidential information" speaks to a justification for providing confidential treatment in the first
place. It does not address the issue of why summarization of the information is not possible, or why
the particular information presents exceptional circum stances that would justify a failure to provide a
non-confidential summary. Nor can the single statem ent repeated by Agrati be read as adequate
justification for treating a number of different pieces of information as equally unsusceptible to
summarization. Furthermore, Agrati's assertion that it could not summarize information was
undermined by the fact that Fontana Luigi was ab le to produce summaries of the same types of

802These non-confidential summaries relate to information concerning volume of production,
production capacity, capacity utilization, total purchases in volume and value, stocks in volume of finished
goods, sales and re-sales in value and volume both to related and unrelated companies, captive use, cost of
production, consumption of raw material, profitab ility for the product in question and total company
profitability, cash flows, investments, returns on net assets, and employment and labour costs both for the
product concerned and for the company. (See Panel Report, para. 7.517 (referring to Annexes to Fontana Luigi's
Non-confidential Questionnaire Response (Panel Exhibit EU-28))
803Panel Report, para. 7.517.

information.
804 We agree with the Panel that Agrati's st atement did not "relate to any of the specific
information for which no non-confidential summary [w as] provided or to anything having to do with
Agrati itself".805 Therefore, we consider that the Commissi on failed to ensure that Agrati provided an
appropriate statement of why summarization of certa in portions of its questionnaire response was not
possible.
554. With respect to Fontana Luigi, we note th at its statement that the non-summarized
information is "by nature confidential because it s disclosure would be of significant competitive
advantage to a Competitor" also addresses the reaso ns for seeking confidential treatment in the first
place rather than demonstrating that summarization of the information is not possible. Indeed,
Fontana Luigi did not even assert that the confiden tial information could not be summarized, much
less make the case that the information at issu e qualified as an "exceptional circumstance" under
Article 6.5.1. In the complete absence of an y statement of reasons why summarization of the
confidential information was not possible, we agr ee with the Panel that the European Union, in
accepting these statements as sufficient, did not meet its obligations under Article 6.5.1.
555. Moreover, the Panel record does not indicate th at the Commission examined these statements
to evaluate their consistency with Article 6.5.1.
806 In its appellant submission, the European Union
states that it had requested improved non-confiden tial summaries from the domestic producers, and
that, because interested parties did not complain further about the non-confidential file, "the
authorities considered that there was no need to insist further".
807 The European Union further states
that "no further investigation was conducted in resp ect of the few pieces of information for which no
summary was provided and for which a statement of reasons was offered." 808 Article 6.5.1 of the
Anti-Dumping Agreement requires an investigating authority to scrutinize the reasons given by the
party to determine whether they establish exceptiona l circumstances, and whether the reasons given
appropriately explain why summarization is no t possible. We do not consider that the
European Union did so in this case.
556. For these reasons, we uphold the Panel's findings, in paragra phs 7.516 and 7.517 of the Panel
Report, that the European Union acted inconsistent ly with its obligations under Article 6.5.1 of the
Anti-Dumping Agreement when it failed to ensure that the domestic producers Agrati and

804Panel Report, para. 7.516.
805Panel Report, para. 7.516.
806For both producers, the Panel stated that "[t]here is nothing in the Definitive Regulation, or any other
evidence that has been prof fered, that would even suggest that th e Commission ever considered whether [the
parties'] stated reason for the lack of a non-confidential summary … was more than pro forma." (Panel Report,
paras. 7.516 and 7.517)
807European Union's appellant's submission, para. 332.
808European Union's appellant's submission, para. 332.

Fontana Luigi provide appropriate statements as to why summarization of confidential information
was not possible.
D. Confidential Treatment of Information S ubmitted by the Analogue Country Producer,
Pooja Forge
557. We turn next to the European Union's appeal of the Panel's finding that the European Union
acted inconsistently with its obligations under Article 6.5 of the Anti-Dumping Agreement "with
respect to the treatment of the confidential information in Pooja Forge's questionnaire response".809
558. In the fasteners investigation, the Commission applied Article 2(7) of its Basic AD
Regulation to China and therefore did not determ ine normal value on the basis of the information
from Chinese producers and exporters. Rather , the Commission sought information from analogue
country fastener producers and ultimately found one company in India, Pooja Forge, that was willing
to respond to requests for information from the Commission. Pooja Forge provided substantial
amounts of information that was used as the basis fo r determining normal value. When it returned its
questionnaire, Pooja Forge submitted a non-confidential version of its response, in which it designated
large portions as confidential, or left them blank.
810 China contended that this information should not
have been granted confidential treatment by the Commission. The Panel determined that "China
[had] not put forward any evidence or arguments wi th respect to the confidential treatment of any
other category of information than that concerning product types", and limited its analysis to that
category.
811 The Panel went on to find that Pooja Forg e did not assert or show any "good cause" for
treating such "product type" information as conf idential, nor did it provide a non-confidential
summary or a statement of why summarization of the confidential information was not possible. 812
On this basis, the Panel concluded that the Europ ean Union acted inconsistently with its obligations
under Article 6.5 of the Anti-Dumping Agreement because it treated "product type" information as
confidential without requiring Pooja Forge to show "good cause" for such treatment.813

809Panel Report, para. 7.525.
810The Panel found that the non-confidential response contained information on company turnover,
production, capacity and capacity utilization, but did not include information on sales to independent customers,
costs or profits. (Panel Report, para. 7.518)
811The Panel noted in this respect that, in its second written submission to the Panel, China claimed that
the non-confidential summary of Pooja Forge's questionnaire response "does not contain any information, and in
particular information on the 'product types' on the basis of which the information has been provided by this
producer", and the Panel decided to limit its analysis to the confidential treatment of "product types". (Panel
Report, para. 7.524 and footnote 1041 thereto (quotin g China's second written submission to the Panel,
para. 1110 (original emphasis)) We recall that the term "p roduct types", as used in the fasteners investigation,
refers to the product categories upon which the Commission based its comparison between normal value and
export price.
812Panel Report, para. 7.525.
813Panel Report, para. 7.525.

559. The European Union appeals the Panel's findi ngs regarding the confidential treatment of
Pooja Forge's questionnaire response on proce dural and substantive grounds. First, the
European Union contends that China's claim rega rding the Commission's confidential treatment of
information submitted by Pooja Forge was not within the Panel's terms of reference
814, or, in the
alternative, that the manner in which China and the Panel dealt with this claim over the course of the
proceedings deprived the European Union of its ri ghts to due process, and that the Panel made the
case for the complainant. 815 Second, the European Union claims that the Panel erred in finding that
the requirement to show "good cause" for confidential treatment of information in Article 6.5 applies
also to analogue third country producers. In the European Union's view, the requirements of
Article 6.5 apply only to "interested parties", as that term is defined in Article 6.11 of the
Anti-Dumping Agreement, and a third country producer like Pooja Forge is not an "interested party"
under that provision.816 The European Union further argues that this interpretation makes sense in the
context of an investigation involving an analogue co untry producer, because it would be too difficult
to recruit companies willing to participate in such an investigation if they had to comply with the
requirements of Articles 6.5 and 6.5.1.817
560. China contends that its claim under Article 6.5 challenging the Commission's confidential
treatment of information submitted by Pooja Forge w as within the Panel's terms of reference. China
argues that the Appellate Body should in any case reject the European Un ion's appeal, because the
European Union did not raise this issue "promptly" be fore the Panel, and thereby waived its rights to
have such an objection considered on appeal. 818 China further contends that Article 6.2 of the DSU
requires a party to list its claims in the panel request, but does not require a party to include its
arguments explaining how the identified measure violates the responding party's obligations under a
provision.819 On the substance of the European Union's claim, China points out that, by its own terms,
Article 6.5 applies to "parties to an investigation", and not to "interested parties", and that the former
term is a more inclusive concept that would also cover an analogue country producer.820 China argues
that, due to the broad discretion investigating auth orities have in determining an alternative normal
value for NME countries, it is particularly important that the transparency requirements contained in
Article 6.5 are strictly enforced. 821 Finally, China argues that, even if Article 6.5 applies only to
"interested parties" within the meaning of Article 6.11, it should nevertheless apply to Pooja Forge,

814European Union's appellant's submission, paras. 335 and 336.
815European Union's appellant's submission, paras. 343 and 344.
816European Union's appellant's submission, paras. 349-353.
817European Union's appellant's submission, para. 356.
818China's appellee's submission, paras. 572-575.
820China's appellee's submission, paras. 599-603.

because the Commission designated the company an "i nterested party" by virtue of Pooja Forge's
involvement in the investigation.822
561. Regarding the Panel's terms of reference, th e European Union acknowledges that it did not
raise its challenge in this respect before the Panel. 823 The Appellate Body has found that parties are
required to raise procedural objections "promptly" 824, but also that matters going to the jurisdiction of
a panel are "fundamental" and can therefore be raised at any stage in a proceeding, including on
appeal.825 If a claim is not within a panel's terms of reference, the panel does not have the jurisdiction
to hear the claim. Moreover, a party's failure to raise a timely jurisdicti onal objection cannot operate
to cure such a jurisdictional defect. We therefore find that the European Union's failure to raise its
terms of reference claim promptly before the Pa nel does not bar it from bringing this challenge on
appeal.
562. Article 6.2 of the DSU lays out the key requireme nts for a panel request and, by implication,
the establishment of a panel's terms of reference under Article 7.1 of the DSU. The complaining party
must identify the specific measure at issue and provide a brief summary of the legal basis of the
complaint, sufficient to present the problem clearl y. The Appellate Body has found that the panel
request "assists in determining the scope of the dispute" in respect of each measure, and
"consequently, establishes and delimits the jurisdiction of the panel".
826 The panel request also serves
the important due process objective of notifying the respondent of the nature of the case it must
defend.
827 As the Appellate Body stated in EC and certain member States – Large Civil Aircraft ,
"[t]his due process objective is not constitutive of, but rather flows from, the proper establishment of a
panel's jurisdiction". 828 The panel request must therefore be examined "as it existed at the time of
filing" in order to determine whether a particular claim falls within the panel's terms of reference. 829
For its part, a panel must "scrutinize carefully the panel request, read as a whole, and on the basis of

822China's appellee's submission, paras. 608-611.
823European Union's appellant's submission, para. 337.
824Appellate Body Report, US – Carbon Steel , para. 123; Appellate Body Report, Mexico – Corn
Syrup (Article 21.5 – US) , para. 50; Appellate Body Report, US – FSC , para. 166; Appellate Body Report,
US – 1916 Act, para. 54.
825Appellate Body Report, EC and certain member States – Large Civil Aircraft , para. 791; Appellate
Body Report, US – Carbon Steel, para. 123; Appellate Body Report, Mexico – Corn Syrup (Article 21.5 – US) ,
826Appellate Body Report, EC and certain member States – Large Civil Aircraft, para. 640.
827See Appellate Body Report, US – Carbon Steel , para. 126 (referring to Appellate Body Report,
Brazil – Desiccated Coconut , p. 22, DSR 1997:I, 167, at 186). Appellate Body Report, EC – Chicken Cuts ,
para. 155; and Appellate Body Report, US – Zeroing (Japan) (Article 21.5 – Japan), para. 108.
828Appellate Body Report, EC and certain member States – Large Civil Aircraft, para. 640.
829Appellate Body Report, EC and certain member States – Large Civil Aircraft, para. 642.

the language used"
830, in order to determine whether it is "sufficiently precise" 831 to comply with
Article 6.2 of the DSU. A party's later submissi ons may be referenced where the meanings of the
terms used in the panel request are not clear on their face, but the content of these subsequent
submissions "cannot have the effect of curing the failings of a deficient panel request".832
563. Turning to the European Union's appeal, we note that China stated in its panel request that the
European Union had violated:
… Articles 6.2, 6.4, 6.5 and 6.5.1 of the [ Anti-Dumping Agreement]
because the EC failed to ensure that domestic producers provided
non-confidential summaries of confidential information they
submitted or because the EC wrongly treated information as being
confidential, thereby preventing Ch inese producers to have the full
opportunity for the defence of their interests.
833
We read China's panel request as containing the claims that: (i) the European Union failed to ensure
that domestic producers provided non-confiden tial summaries of information submitted as
confidential; or (ii) the European Union wrongl y treated information as being confidential, and
thereby prevented Chinese producers from having a full opportunity to defend their interests.
564. The claim subject to the European Union's te rms of reference challenge is whether the
European Union wrongly treated information submitt ed by Pooja Forge in its questionnaire response
regarding "product types" as confidential. Because Pooja Forge is not a domestic producer, this claim
cannot fall under the first phrase in the panel requ est. However, the language of the second phrase,
"the [European Union] wrongly treated information as being confidential", is broad enough to capture
China's claim regarding the confidential treatment of information submitted by Pooja Forge. A claim
that "the [European Union] wrongly treated in formation as confidential" implies that the
European Union did so in circum stances where "good cause" was not s hown, and so falls within the
scope of Article 6.5 of the Anti-Dumping Agreement. The fact that the first phrase refers to "domestic
producers" does not, in our view, limit or reduce the scope of the second phrase. We therefore find
that China's claim under Article 6.5 of the Anti-Dumping Agreement regarding the Commission's
confidential treatment of information submitted by Pooja Forge was within the Panel's terms of
reference.

830Appellate Body Report, US – Carbon Steel , para. 127; Appellate Body Report, US – Oil Country
Tubular Goods Sunset Reviews , paras. 164 and 169; Appellate Body Report, US – Continued Zeroing ,
831Appellate Body Report, EC – Bananas III, para. 142; Appellate Body Report, US – Zeroing (Japan)
(Article 21.5 – Japan), para. 108.
832Appellate Body Report, EC and certain member States – Large Civil Aircraft , para. 642; Appellate
Body Report, EC – Bananas III, para. 143; Appellate Body Report, US – Carbon Steel, para. 127.
833WT/DS397/3, p. 5.

565. As we have found that this claim was properly be fore the Panel, we turn to the substantive
arguments and claims raised by the European Un ion on appeal. The European Union submits that,
through the manner in which the Panel dealt with it s claim under Article 6.5, the Panel deprived it of
its due process rights and thus acted inconsistently with Article 11 of the DSU. The European Union
further claims that the Panel violated Article 11 of the DSU also because it impermissibly "made the
case" for China through its questioning durin g the proceedings related to this claim. 834 Specifically,
the European Union argues that, but for the Panel's questioning, China would not have articulated its
argument, or established a prima facie case, that "good cause" had not been shown to justify the
Commission's treatment of information submitted by Pooja Forge as confidential.
566. We note at the outset that the burden rests on the complainant to substantiate its claims with
legal arguments and evidence in its written and oral submissions to the panel. While the DSU, and
Article 11 in particular, require a panel to make an objective assessment of the matters that are before
it, the panel must turn its attention to and direct its questions at claims and arguments that the parties
have articulated. Where a complainant has failed to set forth arguments in its submissions before a
panel sufficient to substantiate its claims, a pane l may not use its interrogative powers to make good
the absence of relevant substantiating arguments and evidence. 835 We should not be understood to
suggest, however, that, where arguments have been affirmatively raised by the parties, the panel
should not fully scrutinize such evidence and argumentation. Where there is an absence of
argumentation, however, a panel cannot intervene to raise arguments on a party's behalf and make the
case for the complainant.
567. We recall that, in reviewing the European Uni on's argument that China failed to substantiate
its claim under Article 6.5, the Panel stated that "t he way in which China had pursued this claim in
this dispute is far from ideal", and that it was "partic ularly troubled by the fact that the claim was not
developed at all in China's first written submission". 836 The Panel explained that China's "fail[ure] to
put forward a fuller explanation of and argument in support of its claim … left the European Union in
a difficult position in attempting to respond to a claim that was unclear". 837 The Panel determined,
however, that China ultimately provided, "in its second written submission and its answer to [Panel]
question 71, a sufficiently clear argument in suppor t of its claim to allow the European Union an
adequate opportunity to respond".838

834European Union's appellant's submission, paras. 340-347.
835See also Appellate Body Report, US – Continued Zeroing , para. 343; Appellate Body Report,
836Panel Report, para. 7.522.
837Panel Report, para. 7.522.
838Panel Report, para. 7.522.

568. We too are troubled by the way in which Chin a pursued its claim under Article 6.5 regarding
the confidential treatment of "product type" inform ation submitted by Pooja Forge. As the Panel
found, China did not articulate a "good cause" claim or argument under Article 6.5 in its first written
submission. The arguments China did make in its fi rst submission were limite d to the deficiency of
the non-confidential version of Pooja Forge's questionnaire response, which is a claim under
Article 6.5.1, and not related to the issue of whether "good cause" for confidential treatment was
shown under Article 6.5.
569. The Panel record indicates that, at the first mee ting of the parties, the claims regarding Pooja
Forge were not addressed by either party in its oral statement. After the first meeting of the parties,
referring to China's first written submission, the Panel asked China the following:
Question 71: The Panel notes that in the heading of its claim
regarding alleged deficiencies in questionnaire responses, China also
refers to questionnaire responses by the producer in the analogue
third country. The body of China' s argumentation in this regard,
however, does not make reference to this issue. Please elaborate.
China submitted its response to this question on the same day that it filed its second written
submission. China's answer to Panel Question 71 stated, in part:
In China's view, a lot of (if not all) information was considered as
confidential although no "good cause" was shown. In this respect,
China inter alia refers to the fact that not even the categorizations
("product types") used for the provision of the data were disclosed.
This information is obviously not confidential and China therefore
fails to see any "good cause" for the confidential treatment of this
information. Indeed, no "good cause" can be shown for treating the
product types applied for the data to be provided, as confidential. By
granting confidential treatment to these data, the EU violated
Article 6.5 of the [Anti-Dumping Agreement].
839 (original boldface)
570. Although China mentioned, for the first time, the issue of "good cause" in its above response,
it did not provide any further arguments or evidence in this respect. In its second written submission,
China stated that it had not dropped its claim under Article 6.5 "as far as it relates to the deficient
character of the questionnaire response of the producer in the analogue country". 840 China then stated
that the non-confidential version of Pooja Forge's questionnaire response "does not contain any
information, and in particular information on the "p roduct types" on the basis of which the
information has been provided by this producer which is obviously not confidential". 841 These
arguments, however, addressed the issue of whet her the non-confidential summary provided by

839China's responses to Panel Question 71, p. 113.
840China's second written submission to the Panel, para. 1110.
841China's second written submission to the Panel, para. 1110. (original emphasis)

Pooja Forge met the requirement of Article 6.5.1. They were not relevant to the issue of whether
"good cause" was shown under Article 6.5 for treating the information submitted by Pooja Forge in its
questionnaire response as confidential.842
571. The Panel record further indicates that, at th e second meeting of the parties, China merely
repeated the same argument it had put forward in its second written submission, that Pooja Forge's
non-confidential questionnaire response was inadequate.843 China did not raise the issue of the lack of
a "good cause" showing in its oral statement at that meeting. Following the second meeting of the
parties, the Panel asked China to clarify whethe r it "expect[ed] a finding" regarding the issue of
"good cause" under Article 6.5, or a finding rega rding the consistency of the non-confidential
summary of Pooja Forge's questionnaire response with Article 6.5.1.844
572. In response, China stated that it sought, first, a finding under Article 6.5, and second, if the
Panel concluded that the information was pr operly treated as confidential, a finding under
Article 6.5.1 that the European Union failed to require Pooja Forge to furnish a "non-confidential
summary" of such information "in sufficient de tail to permit a reasonable understanding of the
substance of the information submitted in confidence". 845 However, in support of these claims, China
again merely reiterated its argument that Pooja Fo rge's questionnaire response "[did] not contain any
information at all and, in particular, concerning the 'product types'".
573. Thus, as the Panel record clearly shows, the only time that China used the term "good cause"
was in its response to Panel Question 71, and there it was used in a cursory manner that only asserted
a claim, without providing substantiating arguments or evidence. Throughout the Panel proceedings,
China focused on the lack of information regarding "product types" in the non-confidential version of

842Although addressed to China, the European Union submitted its own comments in response to Panel
Question 71, stating that, to the extent that China maintains its claims with regard to Pooja Forge, "the Panel
should simply rule that China has failed to make a prima facie case", because it "failed to provide any evidence
in accordance and within the deadlin es set out in paragraph 16 of the Panel's working procedures".
(European Union's response to Panel Question 71 after the first Panel meeting, para. 170)
843In response, the European Union stated that the Panel's Working Procedures prevented it from
allowing China to articulate its argume nts so late in the proceedings, and a sserted that "the Panel should not go
any further because China had its opportunity to try to make its case but it failed to even try". (Panel Report,
para. 7.520)
844Panel Question 103, which reads in full:
With respect to the claim regarding the non-confidential versions of the
questionnaire responses of the two EU producers and that of the Indian
producer, the Panel notes that, in its written submissions, China refers to
Article 6.5 only but in its response to Question [71] from the Panel it refers
to Article 6.5.1. China's panel request refers both to Article 6.5 and 6.5.1.
Please explain whether China expect s a finding under the chapeau of
Article 6.5 or under Article 6.5.1 from the Panel with respect to this claim.
845China's response to Panel Question 103 after the second Panel meeting, p. 24.

the questionnaire response, rather than the lack of a "good cause" showing for confidential treatment
in the first place.
574. Rule 4 of the Panel's Working Procedures requires that, "[b]efore the first substantive meeting
of the panel with the parties, the parties to the dispute shall transmit to the panel written submissions
in which they present the facts of the case and their arguments." As described above, the Panel record
shows that China asserted its claim under Article 6.5 regarding the lack of a "good cause" showing for
the confidential treatment of Pooja Forge's ques tionnaire response only in response to questions from
the Panel, and articulated this claim only afte r the parties had provided the Panel with written
submissions and had attended a subs tantive meeting. We do not find that assertions made so late in
the proceedings, and only in response to questioning by the Panel, can comply with either Rule 4 of
the Panel's Working Procedures, or the requirements of due process of law. The late assertion of a
claim under Article 6.5 with respect to the lack of a "good cause" showing for confidential treatment
of Pooja Forge's "product type" information, a nd the absence of proper argumentation and of the
provision of relevant evidence in support of this assertion, demonstrates that the European Union was
not called upon to respond to China's claim under Article 6.5.
575. In the light of the above, we find that China failed to substan tiate its claim under Article 6.5
of the Anti-Dumping Agreement that the confidential treatment of the "product type" information
submitted by Pooja Forge in its questionnaire response was improper. Therefore, we reverse the
Panel's finding, in paragraph 7.525 of the Panel Repor t, that the European Un ion acted inconsistently
with its obligations under Article 6.5 of the Anti-Dumping Agreement "with respect to the treatment of
confidential information submitted by Pooja Forge". Having reversed the Panel's finding on this
basis, we see no need to make a separate finding under Article 11 of the DSU that the Panel, as argued
by the European Union, deprived it of its due process rights and impermissibly made the case for
China.
846
E. Confidential Treatment of the Identity of the Complainants
576. We now turn to China's other appeal of the Panel's findings under Article 6.5 of the
Anti-Dumping Agreement that the European Union did not err in treating the identity of the
complainants and supporters of the complaint as c onfidential. In the fasteners investigation, the
complainants and supporters of the complaint requ ested the Commission to grant such treatment in
order "to avoid a potential retaliation which could be carried out by some of their Customers who also

846European Union's appellant's submission, paras. 340-347.

buy products directly from P.R. China". 847 The complainants alleged that, if these customers knew
which European producers had requested or supported the initiation of this investigation, they might
discontinue purchasing fasteners from those producer s. The Commission accepted this request and
granted confidential treatment.
577. The Panel found that, although the complainants ' "good cause" showing was limited to the
allegation contained in the complaint, this was not a "fatal lack of evidence" under Article 6.5. 848 In
the Panel's view, the reason for the confidential treatment provided in the complaint, that the
retaliation could be carried out by customers who also bought products from Chinese producers,
"substantiated their assertion to a certain degree by explaining the circumstances which they thought
showed that commercial retaliation could happen". 849 The Panel stated that "unless there is some
reason to believe that the fear of retaliation is unreasonable, unfounded, or untrue—and China has
proffered none—we consider that the allegation of th e complainants in this case is a sufficient basis
for the Commission's conclusion."850 The Panel therefore concluded that the European Union had not
acted inconsistently with Article 6.5 when it treat ed the complainants' iden tity as confidential based
on their allegation of potential commercial retaliation.851
578. On appeal, China argues that the Panel erre d in finding that the "potential commercial
retaliation" alleged by the complainants satisfied th e "good cause" requirement of Article 6.5. China
claims that the commercial retaliation asserted by th e complainants was not sufficient to constitute
"good cause", because it was "merely hypothetical". 852 China further submits that the complainants
failed to provide any evidence to support the assertion of potential commercial retaliation contained in
the complaint.853 Moreover, China claims that the Panel erre d in the interpretation of Article 6.5, and
acted inconsistently with Article 11 of the DSU, wh en it shifted the burden to China to show that the
complainants' assertion of potential commercia l retaliation was "unfounded, unreasonable, or
untrue".854 China contends that it demonstrated that this assertion was unfounded when it argued that
the same producers' identity were in fact disclos ed as sampled producers in the context of the
Commission's injury determination. 855 Finally, should the Appellate Body find that no "good cause"
existed to treat the identity of the complainants and supporters as confidential under Article 6.5, China
asks the Appellate Body to complete the an alysis under Articles 6.2 and 6.4 of the Anti-Dumping

847Panel Report, para. 7.448.
848Panel Report, para. 7.453.
849Panel Report, para. 7.453.
850Panel Report, para. 7.453.
851Panel Report, para. 7.455.
852China's other appellant's submission, paras. 450-453.
853China's other appellant's submission, paras. 458 and 459.
854China's other appellant's submission, paras. 464-467 (referring to Panel Report, para. 7.453).
855China's other appellant's submission, paras. 471-477.

Agreement and find that the European Union's failure to disclose the identity of the complainants and
supporters was also inconsistent with these provisions.
856
579. In response, the European Union argues that China's claim ignores the fact that the purpose of
protecting confidential information under Article 6.5 is to ensure that any adverse consequences
resulting from the disclosure of sensitive information remain hypothetical. 857 According to the
European Union, the Panel did not rely on a "mere assertion", but evaluated the evidence in the light
of the specific justification given. 858 In addition, the European Unio n points out that the claim China
raises under Article 11 of the DSU was not included in its Notice of Other Appeal, and that it is
therefore not properly before the Appellate Body.
859 In any event, the European Union asserts that the
Panel did not err in shifting the burden of proof to China, because, having brought the claim before
the Panel, it was up to China to make out a prima facie case of inconsistency. 860 Regarding the
disclosure of the identity of the sampled producers later in the investigation, the European Union
contends that China's claim relate s to the Panel's weighing of the ev idence, and therefore should have
been brought under Article 11 of the DSU, which China did not do. 861 On the substance of the
argument, the European Union counters that not all of the sampled producers were supporters of the
complaint, and that the sampled producers that mere ly cooperated in the investigation did not face the
same risks in having their identity disclosed as the complainants.862
580. As a preliminary matter, we address the Europ ean Union's challenge that China's claim under
Article 11 of the DSU in relation to the Panel's finding that "good cause" had been shown for the
confidential treatment by the Commission of the comp lainants' identity is not properly before us
because that claim was not mentioned in China's No tice of Other Appeal. China contends that the
language of its Notice of Other Appeal was sufficien t to notify the European Union of the nature of
China's claim despite the absence of an explicit listing of Article 11 of the DSU in this respect. China
further observes that, under the new Working Procedures that entered into force on
15 September 2010, the Notice of Other Appeal and the other appellant's submission are filed on the
same day. Therefore, any doubt about whether a cl aim was raised in China' s Notice of Other Appeal
would have been easily dispelled by its other appellant's submission.863

856China's other appellant's submission, paras. 482-488.
857European Union's appellee's submission, para. 371.
858European Union's appellee's submission, para. 375 (referring to China's other appellant's submission,
para. 462).
859European Union's appellee's submission, para. 362.
860European Union's appellee's submission, para. 378.
861European Union's appellee's submission, para. 363.
862European Union's appellee's submission, para. 385.
863China's responses to questioning at the oral hearing.

581. We are not convinced by China's arguments. Rules 20(2)(d)(ii) and 23(2)(c)(ii)(B) of the
Working Procedures require a participant to include in its Notice of Appeal or Notice of Other Appeal
"a list of the legal provision(s) of the covered agreem ents that the panel is al leged to have erred in
interpreting or applying". The Appellate Body h as recognized the due process function that a Notice
of Appeal fulfils, emphasizing:
… the important balance that must be maintained between the right
of Members to exercise the right of appeal meaningfully and
effectively, and the right of appellees to receive notice through the
Notice of Appeal of the findings under appeal, so that they may
exercise their right of defence effectively.
864
582. If an appellee is not notified of the claims rais ed by the appellant or other appellant in the
Notice of Appeal or Other Appeal, those claims are not properly within the scope of the appeal, and
the Appellate Body will not make findings thereon. 865 China failed to list Article 11 of the DSU in its
Notice of Other Appeal with regard to the confidential treatment of the identity of the complainants
and supporters of the complaint, and we therefore find that this claim under Article 11 is not properly
before us. Thus, absent a claim under Article 11 of the DSU, we are not called upon to evaluate
whether the Panel made an objective assessment of the facts or to examine the Panel's weighing of the
evidence before it.
583. We recall that, in addition to its claim under Artic le 11, which we find to be outside the scope
of our review, China also raises the following four arguments as to why the Panel erred in finding that
confidential treatment of the identity of the comp lainants and supporters of the complaint was not
inconsistent with Article 6.5 of the Anti-Dumping Agreement . First, China alleges that the Panel
relied upon the hypothetical character of commercial retaliation that "could" happen, rather than that
"would" happen.866 Second, China argues that the Panel relied on a mere assertion contained in the
complaint, and did not require any evidence in support of this assertion. 867 Third, China maintains
that the Panel shifted the burden to China to show that the assertion contained in the complaint was
"unfounded, unreasonable, or untrue". 868 Fourth, China asserts that th e Panel erroneously rejected
China's argument that the later disclosure of the complainants' and supporters' identity as sampled

864Appellate Body Report, US – Countervailing Measures on Certain EC Products, para. 62.
865See Appellate Body Report, US – Countervailing Measures on Certain EC Products , para. 72;
Appellate Body Reports, EC – Bananas III (Article 21.5 – Ecuador II)/EC – Bananas III (Article 21.5 – US) ,
para. 285; and Appellate Body Report, Japan – Apples, paras. 124-128.
866China's other appellant's submission, para. 454.
867China's other appellant's submission, para. 455.
868China's other appellant's submission, para. 464 (referring to Panel Report, para. 7.453).

producers undermined the allegation that "good cause" existed for the non-disclosure of the identity of
the same producers as complainants.
869
584. On this basis, we do not understand China to argue that "commercia l retaliation" may not
constitute a "good cause" justification for confidential treatment. In this r espect, we agree with the
Panel that "nothing in Article 6.5 … would excl ude potential commercial retaliation from constituting
good cause for the confidential treatment of any inform ation, including the identity of complainants",
and China does not challenge this finding.870
585. Rather, we understand China to argue that the Commission erred in concluding that a showing
of "good cause" was made by the complainants and that the Panel erred in upholding the
Commission's conclusion. We have set out above that the standard of "good cause" requires that a
balance be struck between the proprietary interest s of those seeking protection of information and the
transparency and due process that should be accorded to parties that require access to information to
defend their interests. On the basis of this test, it is for the investigating authority to strike that
balance and to make an objective determination of whether "good cause" has been shown. Based on
this test, a panel may review such a determination on the basis of relevant facts and legal arguments.
Thus, China's appeal requires us to examine wh ether the Panel, in reviewing the Commission's
determination, made an error in its legal interpretation of Article 6.5 or incorrectly applied Article 6.5
to the ascertained facts on record in this case. With this in mind, we turn to review China's four
arguments set out above.
586. First, China contends that a party requesting confidential treatment must demonstrate that
potential commercial retaliation "w ould" happen if the information was disclosed, and it is
insufficient merely to show that such retaliation "coul d" happen. The question before us, therefore, is
whether the Panel made an error in the interpretati on and application of Article 6.5 because a request
to treat information as confidential requires a demons tration that disclosure "would" give rise to the
potential for retaliation, and not simply that it "could" do so.
587. As we have found above, "good cause" can be shown when the party requesting confidential
treatment demonstrates the risk of a potential adverse consequence. The purpose of granting
confidential treatment in this situation is "precisely to make sure that the feared adverse effect, in this
case 'potential commercial retaliation', remains hypo thetical, and does not actually materialize".
871
We consider that China's argument that the complainants had to demonstrate that potential

869China's other appellant's submission, para. 471.
870Panel Report, para. 7.452.
871Panel Report, para. 7.453.

commercial retaliation "would" happen—rather than "could" happen—mistakes the nature of the
inquiry. Rather, China's claim relates to the gravit y and likelihood of the risk of the occurrence of
potential commercial retaliation that a complainant a lleges, which is a question of degree. We do not
consider that the degree of risk of commercial retali ation is an issue of law. The degree of risk does
not define what constitutes "good cause" within the m eaning of Article 6.5. Nor do we consider the
degree of risk to be an application of the "good cau se" standard to ascertained facts. Rather, it is a
matter relevant to the extent and nature of the evidence required by an investigating authority to
support a showing of "good cause". In reviewing the authority's determination of "good cause", the
Panel's assessment of the likelihood that comme rcial retaliation will occur goes to the Panel's
weighing of the evidence. Thus, we consider that China's challenge is directed at the Panel's
assessment of whether the kind and extent of ev idence before the Commission was sufficient for the
Commission to have reached the conclusion that a showing of "potential commercial retaliation" as
"good cause" had been made.
588. Absent a claim that the Panel failed to conduct an objective assessment of the facts, this is not
a matter to be reviewed by us on appeal. The leve l of risk and, more particularly, the likelihood or
probability that such risk may come about are matters of degree and must be assessed on the facts, and
the Panel conducted such an assessme nt in reaching its finding. No claim under Article 11 of the
DSU has been properly raised on appeal, and theref ore the question before us is whether the Panel
made an error of legal interpretati on or application. No such error, however, has been demonstrated.
Consequently, this factual determination by the Panel warrants no interference by us.
589. Second, with regard to China's claim that th e Panel relied on a mere assertion in reaching its
finding, we recall that the Panel noted that the comp lainants alleged in the complaint that confidential
treatment of the complainants' and supporters' iden tity was necessary because retaliation "could be
carried out by some of their Customers who also buy products directly from P.R. China". 872
According to the Panel, "'potential commercial retali ation' is not a sufficiently concrete phenomenon
that evidence of its existence is likely to be obtainable".873 The Panel considered that the Commission
could rely on the factual circumstance of havi ng customers in common with Chinese suppliers who
might be negatively affected by the complainan ts' actions as evidence of a risk of commercial
retaliation. The Panel went on to state that, "unless there is some reason to believe that the fear of
retaliation is unreasonable, unfounded or untrue—and China has proffered none—we consider that the

872Panel Report, para. 7.448 (quoting European Industrial Fasteners Institute (EIFI), Complaint against
Imports of Carbon Steel Fasteners from China, 24 September 2007 (Panel Exhibit CHN-15)).
873Panel Report, para. 7.453.

allegation of the complainants in this case is a sufficient basis for the Commission's conclusion".
874
The Panel concluded that "China [did] not contest th e factual assertion that some of the customers of
the complainants and the supporters of the applicat ion also bought the subject product from Chinese
producers."875 The Panel found that, "by stating that their customers were also themselves importers
of the subject product from China, the complainants substantiated their assertion to a certain degree
by explaining the circumstances which they th ought showed that commercial retaliation could
happen."876
590. We do not believe that the Panel, in making th ese findings, misinterpreted Article 6.5 of the
Anti-Dumping Agreement or misapplied the correct interpretati on of that provision to the ascertained
facts before it. Rather, the Panel found that th e assertion contained in the complaint demonstrated
"good cause" for treating the complainants' iden tity confidential, because potential commercial
retaliation could occur due to the uncontested fact that the complainants had customers in common
with Chinese suppliers. Moreover, we do not think th at China's argument is directed at whether the
Panel erred in its interpretation of Article 6.5 or application of that provision to the facts of the case.
Rather, China's argument that the Panel relied on this "mere assertion" 877 in reaching its finding
concerns the Panel's weighing of the evidence before it. Yet, as stated above, we are not called upon
to assess whether the Panel exceeded its authority as the trier of facts in reviewing the Commission's
decision to keep the identity of the complainants and supporters c onfidential, because no claim under
Article 11 of the DSU has properly been raised in this respect.
591. Third, China argues that the Panel shifted th e burden to China to show that the assertion
contained in the complaint was "unfounded, unreasonable, or untrue". 878 We recall that, before the
Panel, China claimed that the European Union had acted inconsistently with Article 6.5 by accepting
the assertion of "potential commercial retaliation" in the complainants' request as a sufficient showing
of "good cause" for the confidential treatment of their identity. In raising this claim before the Panel,
it was for China to make out a prima facie case that no "good cause" had been demonstrated by the
complainants, and that the Commission's decision to grant the complainants' request to treat their
identity as confidential was inconsistent with Article 6.5. The Panel did not err, therefore, in asking
China to present legal and factual arguments to s ubstantiate its claim that "good cause" was not
shown, or, as the Panel put it, China had to s how that the complainants' assertion of potential

874Panel Report, para. 7.453.
875Panel Report, para. 7.452.
876Panel Report, para, 7.453.
877China's other appellant's submission, para. 455.
878China's other appellant's submission, para. 464 (referring to Panel Report, para. 7.453).

commercial retaliation was "unreasonable, unfounded, or untrue". 879 We thus do not find that the
Panel shifted the burden of proof to China by requ esting it to do so. As described above, the Panel
reviewed the Commission's determination, and expl ained why it considered that the complainants'
assertion of "potential commercial retaliation" provid ed a sufficient showing of "good cause" for
confidential treatment of the complainants' identity. In our view, the thrust of China's challenge
regarding these findings is again directed mainly at the Panel's weighing of the evidence. As no claim
under Article 11 of the DSU has been properly raised in this regard, we decline to examine further
these findings of the Panel.
592. Finally, we recall that the Panel rejected Chin a's argument that the disclosure of the identity
of the complainants and supporters as sampled pr oducers undermined the allegation that "good cause"
existed for the non-disclosure of the identity of th e same producers or supporters. China's argument
on appeal relies on its challenge of the Pa nel's finding under Article 4.1 of the Anti-Dumping
Agreement that the domestic industry from which the sampled producers were drawn were not all
complainants or supporters of the complaint, because the view of at least one of the sampled
producers regarding support or opposition to the complaint was unknown to the Commission. 880 We
have found above that the Panel did not err in finding that at least one producer who did not
affirmatively state support for the complaint was in cluded in the domestic industry and selected for
the sample. 881 Therefore, China's contention that all producers included in the sample were
complainants or supporters of th e complaint has not been established before the Panel, nor did the
Panel make a factual finding to that effect. Hence, we also do not agree that the disclosure of the
identity of the sampled producers demonstrates, as China contends, that no "good cause" was shown
for keeping the identity of the complainants and supporters confidential. Moreover, we find again that
China's challenge concerns the Panel's factual findi ngs and its weighing of the evidence. We recall
that China did not properly raise a claim under Ar ticle 11 of the DSU with respect to the Panel's
disposition of its argument that the later disclosur e of the complainants' identity as sampled producers
undermined the allegation that "good cause" exis ted for the non-disclosure of their identity as
complainants. Moreover, China has not pointed to any specific error in the Panel's legal interpretation
or application of Article 6.5 to the facts of the c ase. We therefore decline to address further China's
argument in this regard.
593. Based on the foregoing, we uphold the Panel's finding, in paragraph 7.455 of the Panel
Report, that the European Union did not act inconsis tently with its obligations under Article 6.5 of the

879Panel Report, para. 7.453.
880See supra, para. 451.
881See supra, para. 452.

Anti-Dumping Agreement when the Commission granted the requ est to treat the identity of the
complainants and supporters as confidential.
882
F. Whether China's Claim under Articles 6. 2 and 6.4 of the Anti-Dumping Agreement
Regarding the Non-Disclosure of the Identity of the Complainants Was within the
Panel's Terms of Reference
594. The European Union appeals the Panel's finding that China's claims under Articles 6.2 and 6.4
of the Anti-Dumping Agreement with respect to the non-disclosure of the identity of the complainants
and supporters were within th e Panel's terms of reference. 883 The European Union raises this
procedural challenge in its Notice of Appeal indepe ndently of China's substantive claims in its Notice
of Other Appeal that the confidential treatment of the identity of the complainants and supporters is
inconsistent with Article 6.5. The European Un ion appeals the Panel's terms of reference finding
notwithstanding the fact that the Panel subsequen tly found that the confidential treatment of the
complainants' identity was not inconsistent with Article 6.5 and that, as a consequence, the
European Union had not acted inconsistently with Article 6.2 or 6.4.884
595. As we have discussed above, Article 6.2 of the DSU requires a complaining party to identify
in its panel request the specific measure at issue a nd provide a brief summary of the legal basis of the
complaint, sufficient to " present the problem clearly ".885 If a party fails in its panel request to
"present the problem clearly", the claim in question is outside the panel's jurisdiction, and cannot be
heard.

882China requests us to complete the analysis under Articles 6.2 and 6.4 of the Anti-Dumping
Agreement regarding the alleged failure to disclose the identity of the complainants only if we reverse the
Panel's finding under Article 6.5 that a "good cause" s howing of "potential commercial retaliation" had been
made. Having upheld this finding of the Panel under Article 6.5, we consider China's request for completion of
the analysis under Articles 6.2 and 6.4 moot.
883European Union's appellant's submission, para. 361 (referring to Panel Report, para. 7.458).
884The Panel reached this finding because information that is properly treate d as confidential under
Article 6.5 is not subject to the requirement in Article 6.4 to provide timely opportunities for all interested
parties to see all information that is relevant to the pr esentation of their cases. Moreover, the Panel found that
the requirement in Article 6.2 that interested parties have a full opportunity for the defence of their interests
throughout the anti-dumping investigation is also conditional upon the need to preserve confidentiality.
885Emphasis added. As we have also stated above, the panel request "establishes and delimits the
jurisdiction of the panel" and also serves the important due process objective of notifying the respondent of the
nature of the case it must defend. (Appellate Body Report, EC and certain member States – Large Civil Aircraft,
para. 640. See Appellate Body Report, US – Carbon Steel , para. 126 (referring to Appellate Body Report,
Brazil – Desiccated Coconut, p. 22, DSR 1997:I, 167, at 186; also Appellate Body Report, EC – Chicken Cuts,
para. 155; and Appellate Body Report, US – Zeroing (Japan) (Article 21.5 – Japan) , para. 108)) This request
must be examined as it existed at the time of submission an d, if deficiencies exist, they cannot be cured through
the examination of the party's subsequent submissions. (Appellate Body Report, EC and certain member
States – Large Civil Aircraft, para. 642; Appellate Body Report, EC – Bananas III, para. 143; Appellate Body

596. China's panel request states that the Definitive Regulation was inconsistent with:
… Articles 6.2 and 6.4 of the [ Anti-Dumping Agreement ] and
paragraph 151(c)(e) of the Working Party Report on the Accession of
China because the EC failed to ensure throughout the investigation to
Chinese producers/exporters the full opportunity for the defence of
their interests and failed to provide timely opportunities for them to
see all information that is relevant to the presentation of their cases,
including, but not limited to the composition of the domestic
industry, data concerning normal value determination, information on
the adjustments for differences affecting price comparability,
Eurostat data on the basis of which are based the total EC production
and EC consumption figures.
886
China's panel request contains four cl aims under Articles 6.2 and 6.4 of the Anti-Dumping Agreement
relating to: (i) the composition of the domestic industry; (ii) data concerning normal value
determination; (iii) information on the adjustment s for differences affecting price comparability; and
(iv) Eurostat data on which total EU production and consumption figures are based.
597. We find that China's claim regarding the disclos ure of the identity of the complainants and
supporters does not fall within the scope of any of th e four above descriptions. The Panel did not find
otherwise, but considered that China's panel request should not be read as being limited to the specific
descriptions contained in the request because they are preceded by the phrase "including, but not
limited to".887 The Appellate Body has previously found, however, that this phrase cannot operate to
include any and all other claims not specifically included in the request.888 Rather, each claim must be
presented in a manner that "presents the problem clearly" within the meaning of Article 6.2 of the
DSU. China emphasizes the distinction between "cla ims" and "arguments", and asserts that the above
descriptions represent "arguments" that need not be included in a panel request at all pursuant to
Article 6.2. This, however, does not mean that the mere listing of Articles 6.2 and 6.4 of the
Anti-Dumping Agreement, without more, succeeded in "present[ing] the problem clearly" in respect of
the alleged failure to disclose the identity of the complainants and the supporters of the complaint.
598. Therefore, we disagree with the Panel that th e "nature" of the obligations in Articles 6.2
and 6.4 of the Anti-Dumping Agreement is such that a complaining party need only list these Articles
in order to satisfy the requirements in Article 6.2 of the DSU to "provide a brief summary of the legal
basis of the complaint sufficient to present the problem clearly", and to notify the respondent and third
parties of the nature of the case raised. We ar e of the view that the obligations contained in
Articles 6.2 and 6.4 of the Anti-Dumping Agreement are relatively broad in scope and apply on a

886China's panel request (Panel Report, Annex G, p. G-9).
887Panel Report, para. 7.458.
888Appellate Body Report, India – Patents (US), para. 90.

continuous basis throughout an investigation. The variety of claims contained in the panel request
itself attests to this fact. It may be possible in some circumstances to refer to the initial written
submissions of the parties to clarify the meaning of the terms used in a panel request. In this case,
however, we do not believe that China's claim under Articles 6.2 and 6.4 challenging the non-
disclosure of the complainants' and supporters' identity can be read into the terms actually used in the
panel request by recourse to clarification found in China's submissions.
599. We therefore reverse the Panel's finding, in paragraph 7.458 of the Panel Report, that China's
claims under Articles 6.2 and 6.4 of the Anti-Dumping Agreement regarding the non-disclosure of the
identity of the complainants and the supporters of the complaint were within the Panel's terms of
reference. As a consequence, we declare moot th e Panel's subsequent finding, in paragraph 7.459 of
the Panel Report, that the European Union did not act inconsistently with Articles 6.2 and 6.4 of the
Anti-Dumping Agreement by not disclosing the identity of the complainants and the supporters of the
complaint.
IX. Time-Limit for Submission of the MET/IT Claim Form
600. We turn now to address China's appeal of the Panel's finding that the "Market Economy
Treatment and/or Individual Treat ment Claim Form" (the "MET/IT Claim Form") in the fasteners
investigation was not subject to the 30-day peri od for reply provided in Article 6.1.1 of the
Anti-Dumping Agreement. To provide the relevant background, we recall that, when an anti-dumping
investigation involves an NME, the European Uni on applies an alternative method for calculating
normal value, pursuant to Article 2(7) of the Basic AD Regulation, using data from a market economy
third country or using a constructed value and also calculates a country-wide anti-dumping duty for all
exporters pursuant to Article 9( 5) of the Basic AD Regulation.
889 However, if they satisfy certain
criteria, NME exporters can individually establish that they operate under market conditions (under
the "MET test"), or, in the alternative, that their export prices are free from State intervention (under
the "IT test").
890 If an exporter satisfies the MET test, both normal value and export price will be
calculated based on its own domestic sales data, and it will receive an individual dumping margin and
individual duty, thereby receiving the same treatment as market economy exporters. 891 If an exporter
does not fulfil the MET test, but satisfies the IT test, its dumping margin will be calculated based on a
comparison of an alternative normal value calculation and that particular exporter's export price, such

889Panel Report, para. 7.47.
890See supra, section IV.B of this Report for a detailed description of the MET and IT tests contained in
the Basic AD Regulation.
891Panel Report, para. 7.47.

that it will receive an individual dumping margin and duty rather than a country-wide duty. 892 For
purposes of determining what kind of treatment NME exporters will receive dur ing the investigation,
the Commission distributes to each exporter a single form entitled "Market Economy Treatment
and/or Individual Treatment Claim Form" (the ME T/IT Claim Form). The Commission distributed
these forms in the fasteners investigation, and gave Chinese producers 15 days from the date of
publication of the Notice of Initiation of the investigation to complete them.893
601. China argued before the Panel that the European Union acted inconsistently with Article 6.1.1
of the Anti-Dumping Agreement because the Commission failed to allow the Chinese exporters and
producers at least 30 days to complete the MET/IT Claim Forms, counted one week from the date on
which they were sent out by the investigating authorit y. The Panel rejected China's claim. It found
that the 30-day period stipulated in Article 6.1.1 applies only to "questionnaires", which it defined as
"the initial comprehensive questionnaire issued in an anti-dumping investigation to each of the
interested parties by an investigating authority at or following the initiation of an investigation,
which … seeks information as to all relevant issues pe rtaining to the main questions that will need to
be decided (dumping, injury and causation)".
894 The Panel examined the MET/IT Claim Form and
concluded that the form was not a "questionnaire" w ithin the meaning of Article 6.1.1, and that the
European Union was not obliged to give producers at least 30 days for its submission.895
602. On appeal, China claims that the Panel erred in its interpretation of the term "questionnaires"
in Article 6.1.1 of the Anti-Dumping Agreement, as well as in its application of this interpretation to
the MET/IT Claim Form. China argues that the pr oper interpretation of the term "questionnaires"
covers all "information requests … which are so s ubstantial that they deserve verifications being
carried out and [which] do not prevent the investig ating authorities from complying with the time-
frames set out in the [Anti-Dumping Agreement]".896 In the alternative, if the Appellate Body upholds
the Panel's interpretation of the term "questionnaires", China argues that the Panel acted inconsistently
with Article 11 of the DSU and Article 17.6 of the Anti-Dumping Agreement when it found that the
MET/IT Claim Form did not fall within its definition of that term.897
603. The European Union requests the Appellate Body to uphold the Panel's interpretation of
Article 6.1.1 of the Anti-Dumping Agreement and argues that China's interpretation "would make the

892Panel Report, paras. 7.48 and 7.49.
893Panel Report, para. 7.567.
894Panel Report, para. 7.574.
895Panel Report, para. 7.577.
896China's other appellant's submission, para. 538.
897China's other appellant's submission, para. 544.

meaning of the term 'questionnaires' arbitr ary and dependent on a case-by-case analysis".
898 T h e
European Union also argues that the Panel's dete rmination that the MET/IT Claim Form was not a
"questionnaire" for purposes of Article 6.1.1 was correct, because the MET/IT Claim Form is narrow
in scope and serves a different purpose from "the in itial comprehensive questionnaire" distributed in
an anti-dumping investigation. 899 The European Union further s ubmits that China's claims under
Article 11 of the DSU and Article 17.6 of the Anti-Dumping Agreement are not properly before the
Appellate Body because they are not included in China's Notice of Other Appeal.900
604. As a preliminary matter, we agree that Chin a's Notice of Other Appeal does not explicitly
mention claims under Article 11 of the DSU and Article 17.6 of the Anti-Dumping Agreement901 in
connection with its claim that the Panel erred in its application of Article 6.1.1 of the Anti-Dumping
Agreement. In its Notice of Other Appeal, China " seeks review of the Panel's conclusions and
findings concerning China's claim that the European Union violated Article 6.1.1 of the
[Anti-Dumping Agreement ]". China asserts that "the Panel er red in its interpretation of the term
'questionnaire' in Article 6.1.1", and that "even assu ming that the Panel did not err in its interpretation
of the term 'questionnaire' … the Panel erroneously concluded that the MET/IT claim form was not a
'questionnaire' according to this definition". Chin a also requests the Appellate Body "to reverse the
Panel's findings and to conclude that the 'MET/IT claim form' is a questionna ire within the meaning
of Article 6.1.1 of the [ Anti-Dumping Agreement ] and to complete the anal ysis by finding that the
[European Union] violated Article 6.1.1 of the [Anti-Dumping Agreement]".
605. Accordingly, it is clear from the face of th e Notice of Other Appeal that this ground of
China's other appeal was raised only under Article 6.1.1 of the Anti-Dumping Agreement . As
discussed above902, under Rules 20(2)(d)(ii) and 23(2)(c)(ii) of the Working Procedures, only claims
under those provisions of the covered agreements sp ecifically listed in a Notice of Appeal or Other
Appeal are properly raised on appeal. Therefore, as China's claims under Article 11 of the DSU and
Article 17.6 of the Anti-Dumping Agreement regarding the MET/IT Claim Form were not included in
its Notice of Other Appeal, we decline to make fi ndings upon them. We proceed next to address the
remaining issues raised in China's other appeal under Article 6.1.1 of the Anti-Dumping Agreement.

898European Union's appellee's submission, para. 418.
899European Union's appellee's submission, para. 429.
900European Union's appellee's submission, para. 405.
901We note that the European Union has not raised this challenge in its appellee's submission, but we
recall that matters going to the jurisdiction of a panel are fundamental and can therefore be raised at any stage in
a proceeding. (See Appellate Body Report, EC and certain Member States – Large Civil Aircraft , para. 791;
and Appellate Body Report, US – Carbon Steel, para. 123)
902See supra, paragraphs 581 and 582.

606. Articles 6.1 and 6.1.1 of the Anti-Dumping Agreement read as follows:
6.1 All interested parties in an anti-dumping investigation shall be
given notice of the information which the authorities require
and ample opportunity to present in writing all evidence which
they consider relevant in respect of the investigation in
question.
 6.1.1 Exporters or foreign producers receiving questionnaires
used in an anti-dumping investigation shall be given at
least 30 days for reply.[*] Due consideration should be
given to any request for an extension of the 30-day
period and, upon cause shown, such an extension should
be granted whenever practicable.
[* original footnote 15] As a general rule, the time-limit for exporters shall
be counted from the date of receipt of the questionnaire, which for this
purpose shall be deemed to have been received one week from the date on
which it was sent to the respondent or transmitted to the appropriate
diplomatic representative of the ex porting Member or, in the case of a
separate customs territory Member of the WTO, an official representative of
the exporting territory.
607. The Panel began its interpretation of the term " questionnaires" in Article 6.1.1 by referring to
a dictionary definition, namely "a formulated seri es of questions by which information is sought from
a selected group". 903 The Panel determined that this definition "[did] not suffice to answer the
question before [it]", because applying such a de finition "could make it impossible for the authorities
to obtain necessary information while still respecti ng the time limits on investigation set forth in
Article 5.10 of the [Anti-Dumping Agreement]".904
608. The Panel went on to analyze the context of the term "questionnaires" in Article 6.1.1
provided by other provisions of the Anti-Dumping Agreement that contain the term, including Annex I
on Procedures for On-the-Spot Investigations Pursuant to Paragraph 7 of Article 6. 905 Annex I states,
in paragraphs 6 and 7 respectively, that "[v]isits to explain the questionnaire should only be made at
the request of an exporting firm" and that such vi sits "should be carried out after the response to
the questionnaire has been received". The Pane l found that these references suggest that "'the
questionnaire' is a substantial enough information request to warrant a visit to verify the information",
"that it is sent early in the investigation", and that a verification visit is "a significant event" not likely
to be repeated with respect to multiple "questionnaires". 906 In addition to Annex I, the Panel also
emphasized the use of the singular form of the term in footnote 15 of Article 6.1.1, which states that

903Panel Report, para. 7.571 (quoting The New Shorter Oxford English Dictionary , 4th edn, L. Brown
(ed.) (Clarendon Press, 1993), Vol. 2, p. 2447).
904Panel Report, para. 7.571.
906Panel Report, footnote 1122 to para. 7.574.

"the time-limit for exporters shall be counted from the date of receipt of the questionnaire".
907 The
Panel opined that, if the drafters had intended the obligation in Article 6.1.1 to apply to more than one
questionnaire, they might have used a plural or inde finite formulation in the footnote, such as, "'any'
or 'a' 'questionnaire'". 908 Instead, in the Panel's view, the language of the footnote suggests that a
single questionnaire is sent to each recipient. Th e Panel found that the term "questionnaires" in the
first sentence of Article 6.1.1 refers to:
… one kind of document in an investigation. Turning to the question
of what that document might be, we note that the considerations of
context … suggest that it refers to the initial comprehensive
questionnaire issued in an anti-dumping investigation to each of the
interested parties by an investigating authority at or following the
initiation of an investigation, wh ich questionnaire seeks information
as to all relevant issues pertaining to the main questions that will
need to be decided (dumping, injury and causation).[*]
[* original footnote 1123] We recognize that there may be differences in the
initial comprehensive questionnaires sent to the different interested parties,
reflecting their different activities and interests in the investigation.
Moreover, depending on how a Member organizes the conduct of anti-
dumping investigations, there may be separate and distinct initial
questionnaires concerning the issues of dumping and injury and causation.
These circumstances do not affect ou r fundamental conclusion, that the
initial comprehensive document, or set of documents, covering all of these
issues are encompassed by the term "questionnaires" in Article 6.1.1.
909
609. The question before us is whether the Panel er red in defining the term "questionnaires" in
Article 6.1.1 in this manner. The interpretation of Article 6.1.1 requires that the provision be read in
its proper context, in particular Ar ticle 6.1, which it follows. Article 6.1 states that "[a]ll interested
parties in an anti-dumping investigation shall be gi ven notice of the information which the authorities
require and ample opportunity to present in writing all evidence which they consider relevant in
respect of the investigation in question." Article 6. 1 thus requires an investigating authority to give
interested parties: (i) notice of the information the authority requires; and (ii) "ample opportunity" to
present their evidence in writing. Where a speci fic request for information is made by an
investigating authority, what constitutes "ample opportunity" to respond will depend upon the specific
nature and scope of the request.
910 Along with Article 6.2 of the Anti-Dumping Agreement , the
Appellate Body has found that the language in Artic le 6.1 provides for the "fundamental due process

907Panel Report, para. 7.573. (emphasis added by the Panel)
908Panel Report, para. 7.573.
909Panel Report, para. 7.574.
910See Panel Report, US – Anti-Dumping and Countervailing Duties (China) , para. 15.23, where that
panel made a similar finding.

rights" of interested parties in an anti-dumping investigation. 911 Together, these provisions "suggest
there should be liberal opportunities for respondents to defend their interests".912
610. Read in this context, Article 6.1.1 is concerned with the circumstance in which "[e]xporters or
foreign producers" are asked to complete "questionna ires", and requires the investigating authority to
allow these responding parties at least 30 days from the date of receipt to submit responses. Domestic
producers can control the timing of the submission of a request for initiation of an anti-dumping
investigation because it is their complaint that tri ggers the authority's investigative process. The
complaining producers therefore have an opportunity to gather much of the evidence necessary to
support their complaint in advance. The responding parties, on the other hand, typically receive no
notice until the initiation of the investigation. Ar ticle 6.1.1 protects exporters and foreign producers
by requiring investigating aut horities to provide them with at least 30 days to reply to
"questionnaires", and by allowing that extensions should be granted whenever practicable, upon cause
shown. This indicates to us that the specific due process interest of exporters and foreign producers to
be afforded an ample opportunity to respond has been expressly provided for.
913
611. The proper interpretation of Article 6.1.1 must al so take into considerations the interests of
investigating authorities in contro lling their investigative process and bringing investigations to a
close within a stipulated period of time. Article 5.10 of the Anti-Dumping Agreement requires that
investigations be completed within 12 months or, in special circumstances, no more than 18 months.
In this vein, Article 6.14 of the Anti-Dumping Agreement states that none of the procedures set out
under Article 6 is intended "to prevent the authoriti es of a Member from proceeding expeditiously" in
reaching their determinations. The balance between a party's "ample opportunity" and the
investigating authority's interest in controlling the investigative process was articulated by the
Appellate Body in Mexico – Anti-Dumping Measures on Rice, where it found that:
… the due process rights in Article 6 of the Anti-Dumping
Agreement—which include the right to 30 days for reply to a
questionnaire—"cannot extend indefinitely" but, instead, are limited
by the investigating authority's need "to 'control the conduct' of its
inquiry and to 'carry out the multiple steps' required to reach a timely
completion" of the proceeding. As such, the time-limits for
completing an investigation serve to circumscribe the obligation in

911Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews, para. 241.
912Appellate Body Report, US – Oil Country Tubular Goods Sunset Reviews, para. 241.
913Footnote 15 of Article 6.1.1 ensu res that foreign exporters receive a full 30 days for completion and
submission of the questionnaires, by specifying that this period "shall be counted from the date of receipt of the
questionnaire, which for this purpose shall be deemed to have been received one week from the date on which it
was sent".

Article 6.1.1 to provide all interested parties 30 days to reply to a
questionnaire.
914 (emphasis omitted; footnotes omitted)
612. Therefore, while Article 6.1.1 captures a specif ic due process concern as indicated above, the
"questionnaires" referred to in that Article do not refer to every request for information made by an
investigating authority to exporters or foreign producers. Rather, the "questionnaires" must be
substantial requests, distributed early in the inv estigation, when a 30-day timeframe for the response
would not lead to a delay in the completion of th e investigation. They afford the investigating
authority an early opportunity to solicit relevant information from exporters and foreign producers on
key aspects of the investigation that is to be conducted by the authority.
613. Based on these considerations, we conclude that the meaning and scope of the term
"questionnaires" in Article 6.1.1 of the Anti-Dumping Agreement, and its application to specific kinds
of documents, must reflect a balance between the due process requirement to provide parties with an
"ample opportunity" to submit all information they consider responsive to a questionnaire request in
an anti-dumping investigation, and the overall timeframe imposed on the investigation under
Article 5.10, along with the need for authoriti es to proceed expeditiously as contemplated in
Article 6.14. We therefore find that the "questionna ires" referred to in Article 6.1.1 are a particular
type of document containing substantial requests for in formation, distributed early in an investigation,
and through which the investigating authority solic its a substantial amount of information relating to
the key aspects of the investigation that is to be conducted by the authority (that is, dumping, injury,
and causation). While in many investigations one "questionnaire" may be employed to solicit such
information on these aspects of the investigation, we consider that, de pending on how different
Members organize the conduct of the investigation process, a party may receive several substantial
requests soliciting such comprehensive information th at are "questionnaires" within the meaning of
Article 6.1.1.
614. Having defined the kind of information requests that qualify as "questionnaires", we now turn
to examine the MET/IT Claim Form at issue in this case. The European Commission distributes
MET/IT Claim Forms to exporters and foreign producers in countries specified as NMEs under
Article 2(7) of its Basic AD Regulation. The form is 14 pages long and contains questions regarding
corporate identity and other corporate information, primary materials and other cost components for
the product concerned, industrial property right s, labour rights and working conditions, production
facilities and production, sales prices, financial stat ements, and accounting principles and practice.

914Appellate Body Report, Mexico – Anti-Dumping Measures on Rice , para. 282. See also Appellate
Body Report, US – Oil Country Tubular Goods Sunset Reviews , paras. 241 and 242; and Appellate Body
Report, US – Hot-Rolled Steel, para. 73.

The purpose of the MET/IT Claim Form is to dete rmine whether a particular exporter or producer
from an NME country should be treated as a market economy exporter or producer, despite the
exporting country's designation as an NME; or, if a particular exporter cannot satisfy this MET test,
whether that exporter should nonetheless be granted "individual treatment" in the determination of
margins and duties because it is sufficiently inde pendent from the State to satisfy the IT test. 915 The
Panel found that questions contained in the M ET/IT Claim Form "are not relevant in all
investigations, and are not directly related to th e determinations of dumping, injury and causation". 916
Rather, the information solicited is necessary for the determination of whether an exporter or foreign
producer operates under market economy conditions, or whether its export activities are independent
from State intervention.917
615. We recall that Article 6.1 of the Anti-Dumping Agreement requires investigating authorities to
give all interested parties "ample opportunity" to su bmit evidence that they consider relevant to the
investigation, and that this obligation applies also to information requests that cannot be considered
"questionnaires". In our view, the determinati ons made regarding MET and IT treatment are
important for NME exporters and foreign producers.
918 The MET/IT Claim Form was the first request
for information received by the Chinese exporters in the fasteners investigation, and their responses
were subject to verification. 919 While much of the information requested would seem to be readily
accessible to the responding party, the form requests certain production and sales data for "the product
concerned" that may need to be collected and report ed in a form that is not regularly kept by the
company, and could therefore involve a certain amount of time and effort for completion. 920 Given
the consequences of MET/IT status for exporte rs and foreign producers, and the amount of
information solicited in the MET/IT Claim Form , we consider that, under the requirements of
Article 6.1, a deadline of 15 days from the date of publication of the Notice of Initiation was too short
and did not provide parties with "ample opportu nity" to submit all evidence in support of their
requests for MET or IT treatment. However, China has not invoked Article 6.1 in this case. Rather,
China has limited its claim to the specific time pe riod required for the submission of "questionnaires"
under Article 6.1.1, and it is under this provision that we are called upon to make findings.

915European Commission, Market Economy Treatment and/or Individual Treatment Claim Form
(MET/IT Claim Form) (Panel Exhibit CHN-72).
916Panel Report, para. 7.577.
917Panel Report, para. 7.576.
918Panel Report, para. 7.577. See supra, paragraphs 600 and 614.
919Panel Report, para. 7.577.
920For example, the MET/IT Claim Form requests Chinese exporters to submit monthly production
figures for the product concerned, or, if foreign owned, total volume of production during the investigation
period, a list of average unit costs of primary materials, and an explanation of how these materials are procured,
including a list of suppliers. (See Panel Exhibit CHN-72)

616. In determining whether an information request is a "questionnaire" under Article 6.1.1, as we
have defined this term above, an investigating au thority must ascertain whether it is a substantial
request seeking to elicit from exporters and foreig n producers comprehensive information regarding
the key aspects of the anti-dumping determination, that is, dumping, injury, and causation. While the
length and complexity of the request are not irrele vant, the determination of whether a particular
request for information constitutes a "questionna ire" depends on the content and purpose of the
request for information.
617. In order to make determina tions on the key aspects of dumping, injury, and causation,
pursuant to Articles 2 and 3 of the Anti-Dumping Agreement, investigating authorities need to collect,
among other things, information on exporters' products, domestic a nd export sales, production and
production capacity, cost of production, and factors relevant to adjustments to carry out a fair
comparison. The typical anti-dumping questionnaire used by the Commission for exporters therefore
solicits information relating to all of these factor s. More specifically, the questionnaire solicits
information regarding specifications of export and domestic products, comp arison of export and
domestic products, turnover, total quantity and va lue of sales, production and capacity statistics,
stocks, employment, investments, export sales to related and unrelated customers in the
European Union, domestic sales to related and unr elated customers, accounting system and policies,
production process and cost of production, allowa nces on export sales, and allowances on domestic
sales.
921
618. By contrast, the MET/IT Claim Form is employed by the Commission for a different
specifically defined purpose: to select those e xporters or producers that operate under market
economy conditions or that are sufficiently independe nt from the State to justify different treatment
from non-qualifying NME exporters or producers. In determining whether an exporter or foreign
producer operates under market conditions under th e MET test, the Commission examines factors
including: (i) the "decisions of firms regarding prices, costs and inputs"; (ii) their accounting
standards; (iii) the extent to which production cost s are "subject to significant distortions"; (iv) the
applicability of "bankruptcy and property laws whic h guarantee legal certainty and stability"; and
(v) whether "exchange rate conversions are carried out at the market rate". 922 In order to establish
whether an exporter or foreign producer is sufficiently independent from the State under the IT test,
the Commission will determine whether: (i) it is " free to repatriate capital and profits"; (ii) "export
prices and quantities, and conditions a nd terms of sale are freely determined"; (iii) "the majority of

921For purposes of this discussion, we refer to the anti-dumping questionnaire sent to exporters and
producers of farmed salmon from Norway, which was provided to the Panel by China as Exhibit CHN-63.
922Basic AD Regulation, supra, footnote 5, Article 2(7)(c).

the shares belong to private persons"; (iv) "exchang e rate conversions are carried out at the market
rate"; and (v) "State interference [would] permit circumvention of measures if individual exporters
are given different rates of duty".923
619. China argues that much of the information solicited in the MET/IT Claim Form is also
relevant to the determinations of dumping, injury , and causation, and that it is therefore similar
enough to the European Union's typical anti-dumpi ng questionnaire discussed above to constitute a
"questionnaire" for purposes of Article 6.1.1. However, a comparison of these two information
requests shows that a typical anti-dumping questi onnaire solicits different information and for a
different purpose than the MET/IT Claim Form. The latter form solicits information regarding factors
such as what bankruptcy or property laws are app licable, whether companies are free to repatriate
capital and profits, or whether the majority of the shares belong to private parties that may be of
relevance for determining whether exporters operate independently from the State; however, such
information is not relevant for the purpose of determining dumping, injury, or causation.
620. Even where the MET/IT Claim Form and th e typical "questionnaire" solicit similar
information, that information is used for a diffe rent purpose. For example, in making its dumping
determination, the Commission examines in detail an d on a product-by-product basis, factors such as
product specifications, sales, and prices in order to make its comparison between export price and
normal value. In order to do so, the Commi ssion collects data from exporters to determine actual
export quantities and prices, production costs, and capacity.924
621. By contrast, the MET/IT Claim Form requests production information for the different and
specific purpose of determining whether "the produc tion costs and financial situation of firms" are
"subject to significant distortions", and whethe r the "decisions" of NME exporters and producers
regarding prices, costs, and inputs are "made in response to market signals reflecting supply and
demand, and without significant State interferenc e", such that its production costs "substantially
reflect market values". 925 If the MET test is not satisfied, the Commission analyzes the production

923Basic AD Regulation, supra, footnote 5, Article 9(5).
924For example, the typical questionnaire sent by the Commission to exporters in an anti-dumping
investigation requests submission of, inter alia , total production and purchases of the product concerned,
capacity and capacity utilization including how these factors are calculated, the country of origin and specific
sources of purchases of the product, descriptions of production lines and major components, and descriptions of
the manufacturing process a nd production facilities used for each prod uct, including the raw materials used,
relationship to the supplier, other products manufactured in the same facilities, other companies involved in the
manufacturing process, and the number of days the product concerned is on average held in inventory before
sale. All product information must be submitted on the basis of PCNs, which the exporter must create "for each
unique combination of product characteristics" using a table provided by the Commission. (See Panel Exhibit
CHN-63, supra, footnote 921)
925Basic AD Regulation, supra, footnote 5, Article 2(7)(c).

data submitted to determine, under the IT test , whether export prices and quantities "are freely
determined"
926 for the purpose of assessing whether the exporter operates independently from the
State. The MET/IT Claim Form requests much less detailed information than the typical anti-
dumping questionnaire; it requests that exporters submit monthly production figures for the product
concerned, or, if foreign owned, total volume of pr oduction during the investigation period, a list of
average unit costs of primary materials, and an explanation of how these materials are procured,
including a list of suppliers. 927 The MET/IT Claim Form does not request this data to be submitted
based on narrowly defined PCNs or other product categories, but only requests that it be submitted for
the "product concerned". This information c ould not serve as the basis for the Commission's
determination of actual export prices, as required for a dumping determination.
622. In sum, the categories of information solicite d by the MET/IT Claim Form relate to the
factors used under the MET and IT tests for the pur pose of determining whet her an exporter operates
under market conditions or, if not, whether it opera tes independently from the State. The factors
examined by the Commission, such as restrictions on repatriation of capita l and profits, composition
of board members and shareholders , and exchange rate conversions 928, are not relevant to the
Commission's dumping, injury, and causation determin ations. Nor is information solicited in the
MET/IT Claim Form regarding restrictions on th e import of raw materials used, required business
authorizations, and information regardi ng relevant barter or counter trade 929 relevant to the
determinations of dumping, injury, and causation. We conclude that the content of the information
requested under the MET/IT Claim Form is qualitative ly different from the content of the information
requested in a typical anti-dumping questionnaire.930
623. Therefore, based on the content of the MET/IT Claim Form and the purpose for which it is
used, we find that the MET/IT Claim Form is not an information request soliciting from the Chinese
exporters and producers a substan tial amount of information upon which the Commission would base
its determinations regarding the key aspects of an anti-dumping investigation.931 We therefore uphold
the Panel's finding, in paragraph 7.579 of the Pane l Report, that the MET/IT Claim Form is not a
"questionnaire" within the meaning of Article 6.1.1 of the Anti-Dumping Agreement and, that,

926Basic AD Regulation, supra, footnote 5, Article 9(5)(b).
927MET/IT Claim Form, supra, footnote 915, pp. 8 and 10.
928Basic AD Regulation, supra, footnote 5, Article 9(5).
929MET/IT Claim Form, supra, footnote 914, pp. 8, 10, 13, and 14.
930We find that China's further arguments regarding the length and substantial nature of the request, as
well as its importance to Chinese expor ters and producers, are similarly unava iling. As we have found above,
these factors should be taken into consideration when determining whether a party was given "ample
opportunity" to present evidence under Article 6.1.
931Panel Report, para. 7.577.

therefore, the European Union did not act inconsiste ntly with its obligations under Article 6.1.1 when
it did not provide Chinese exporters with 30 days to submit their responses.
X. Findings and Conclusion
624. For the reasons set out in this Report, the Appellate Body:
(a) with respect to Article 9(5) of the Basic AD Regulation932:
(i) upholds the Panel's finding, in paragra ph 7.77 of the Panel Report, that
Article 9(5) of the Basic AD Regula tion concerns not only the imposition of
anti-dumping duties, but also the calculation of dumping margins, and that it
could be challenged "as such" under Article 6.10 of the Anti-Dumping
Agreement, which addresses the calculation of margins of dumping for each
exporter or producer;
(ii) upholds, albeit for different reasons, the Panel's finding, in paragraph 7.98 of
the Panel Report, that Article 9(5) of the Basic AD Regulation is inconsistent
"as such" with Article 6.10 of the Anti-Dumping Agreement , because it
conditions the determinati on of individual dumping margins for exporters or
producers from NMEs on the fulfilment of the IT test;
(iii) upholds, albeit for different reasons, the Panel's finding, in paragraph 7.112
of the Panel Report, that Article 9(5) of the Basic AD Regulation is
inconsistent "as such" with Article 9.2 of the Anti-Dumping Agreement ,
because it conditions the imposition of individual duties on exporters or
producers from NMEs on the fulfilment of the IT test;
(iv) finds that, in making the findings that Article 9(5) of the Basic AD
Regulation is inconsistent "as such" with Articles 6.10 and 9.2 of the
Anti-Dumping Agreement, the Panel did not act inconsistently with Article 11
of the DSU;
(v) declares moot and of no legal effect the Panel's finding, in paragraph 7.127 of
the Panel Report 933, that Article 9(5) of the Basic AD Regulation is
inconsistent with the MFN obligation in Article I:1 of the GATT 1994;

(vi) upholds the Panel's finding, in para graph 7.137 of the Panel Report
934, that
the European Union has acted inconsistently with Article XVI:4 of the
WTO Agreement and Article 18.4 of the Anti-Dumping Agreement by failing
to ensure the conformity of its laws, regulations, and administrative
procedures with its obligations under the relevant agreements;
(vii) upholds the Panel's finding, in para graph 7.148 of the Panel Report 935, that
Article 9(5) of the Basic AD Regulati on is inconsistent with Articles 6.10
and 9.2 of the Anti-Dumping Agreement "as applied" in the fasteners
investigation;
(b) with respect to the Panel's findings under Articles 4.1 and 3.1 of the Anti-Dumping
Agreement936:
(i) finds that the Panel erred in finding, in paragraph 7.230 of the Panel Report,
that "the European Union did not act in consistently with Article 4.1 of the
[Anti-Dumping Agreement ] in defining a domestic industry comprising
producers accounting for 27 per cent of total estimated EU production of
fasteners" on the basis that the collective output of these producers
represented "a major proportion" of the total domestic production;
(ii) finds that the Panel did not err in fi nding, in paragraph 7.241 of the Panel
Report, that China failed to establis h that the European Union acted
inconsistently with Article 3.1 of the Anti-Dumping Agreement in the
selection of a sample of the domestic industry for purposes of making an
injury determination; and
(iii) finds that the Panel did not err in its interpretation or application of
Articles 4.1 and 3.1 of the Anti-Dumping Agreement, or acted inconsistently
with Article 11 of the DSU and Article 17.6 of the Anti-Dumping Agreement,
when finding, in paragraph 7.219 of the Pa nel Report, that "the mere fact that
the domestic industry as ultimately defined does not include any particular
proportion of producers expressing different views with respect to the
complaint, or producers who did not come forward within the 15 day period,

does not demonstrate that the European Union acted inconsistently with
Article 4.1 of the [ Anti-Dumping Agreement ] in defining the domestic
industry" or acted inconsistently with Article 3.1 of that Agreement;
(c) with respect to the Panel's findings regarding certain aspects of the dumping
determination in the fasteners investigation:
(i) finds that the Panel did not err in fi nding, in paragraph 7.494 of the Panel
Report937, that the European Union violated Article 6.4 of the Anti-Dumping
Agreement "by not providing a timely opportunity for Chinese producers to
see information regarding the product types on the basis of which normal
value was established";
(ii) finds that the Panel did not err in fi nding, in paragraph 7.495 of the Panel
Report938, that "the Chinese exporters could not defend their interests in this
investigation because the Commission onl y provided information concerning
the product types used in the determinati on of the normal value at a very late
stage of the proceedings" and that, therefore, "the European Union acted
inconsistently with Article 6.2" of the Anti-Dumping Agreement;
(iii) finds that the Panel did not act inconsis tently with Article 11 of the DSU in
not addressing China's argument that the European Union failed to inform the
interested parties of the "product types" it used to compare the export price
and normal value;
(iv) finds that the Panel erred in its application of Article 2.4 of the Anti-Dumping
Agreement by failing to take into account the last sentence of Article 2.4 in
the light of the relevant facts of the case and of its finding under Article 6.4
of the Anti-Dumping Agreement ; and finds, instead, that, in not disclosing
the information on the product types on a timely basis, the European Union
acted inconsistently with Article 2.4 of the Anti-Dumping Agreement by
failing to indicate to the parties in question what information was necessary
to ensure a fair comparison;
(v) finds that the Panel did not err in its interpretation of Article 2.4 of the
Anti-Dumping Agreement when finding, in paragraph 7.306 of the Panel

Report, that the European Union did not act inconsistently with Article 2.4 of
that Agreement by not making adjustments for every element of the PCN;
(vi) finds that the Panel did not act incons istently with Article 11 of the DSU,
when finding, in paragraph 7.302 of the Panel Report, that there is no
inherent reason to conclude that every element of the PCN necessarily
reflects a difference that affects price comparability; and
(vii) finds that the Panel did not err in its interpretation and application of
Article 2.4 of the Anti-Dumping Agreement in finding, in paragraph 7.311 of
the Panel Report, that the European Union did not have to make adjustments
for alleged quality differences;
(d) with respect to Articles 6.5 and 6.5.1 of the Anti-Dumping Agreement:
(i) upholds the Panel's findings, in paragr aphs 7.516 and 7.517 of the Panel
Report939, that the European Union failed to ensure that the domestic
producers, Agrati and Fontana Luigi, pr ovide appropriate statements of the
reasons why information provided in confidence was not susceptible of
summary;
(ii) finds that China's claim under Article 6.5 that the European Union failed to
establish that "good cause" existed to support the confidential treatment of
information submitted by the analogue country producer participating in the
investigation, Pooja Forge, was within the Panel's terms of reference; but
finds that China failed to substantiate this claim; and therefore
(iii) reverses the Panel's finding, in pa ragraph 7.525 of the Panel Report 940, that
the European Union acted inconsistently with its obligations under Article 6.5
with respect to the treatment of confidential information submitted by
Pooja Forge; and
(iv) upholds the Panel's finding, in para graph 7.455 of the Panel Report 941, that
the European Union did not act inconsistently with its obligations under

Article 6.5 when the Commission granted the request to treat the identity of
the complainants and the supporters of the complaint as confidential; and
(v) finds that China's claim under Article 11 of the DSU regarding the
confidential treatment of the identity of the complainants and the supporters
of the complaint is not within the sco pe of this appeal because it was not
included in China's Notice of Other Appeal;
(e) reverses the Panel's finding, in paragra ph 7.458 of the Panel Report, that China's
claims under Articles 6.2 and 6.4 of the Anti-Dumping Agreement regarding the
non-disclosure of the identity of the complain ants were within its terms of reference
under Article 6.2 of the DSU; and therefore, declares moot the Panel's finding, in
paragraph 7.459 of the Panel Report 942, that the European Union did not act
inconsistently with Articles 6.2 and 6.4 of the Anti-Dumping Agreement by not
disclosing the identity of the complainants and the supporters of the complaint; and
(f) with respect to Article 6.1.1 of the Anti-Dumping Agreement:
(i) upholds the Panel's finding, in para graph 7.579 of the Panel Report 943, that
the "'Market Economy Treatment and/or Individual Treatment claim form' is
not a 'questionnaire' within the meaning of Article 6.1.1"; and that, therefore,
the European Union did not act inconsistently with its obligations under
Article 6.1.1 of the Anti-Dumping Agreement when it did not provide the
Chinese exporters with 30 days to submit their responses; and
(ii) finds that China's claims under Article 11 of the DSU and Article 17.6 of the
Anti-Dumping Agreement regarding the Market Economy Treatment and/or
Individual Treatment Claim Form are not within the scope of this appeal
because these claims were not included in China's Notice of Other Appeal.
625. The Appellate Body recommends that the DSB request the European Union to bring its
measures, found in this Report and in the Panel Report as modified by this Report, to be inconsistent
with the Anti-Dumping Agreement and the WTO Agreement , into conformity with its obligations
under those Agreements.

ANNEX I

29 March 2011
 (11-1542)
 Original: English

EUROPEAN COMMUNITIES1 – DEFINITIVE ANTI-DUMPING MEASURES
ON CERTAIN IRON OR STEEL FASTENERS FROM CHINA

Notification of an Appeal by the European Union
under Article 16.4 and Article 17 of the Understanding on Rules
and Procedures Governing the Settlement of Disputes (DSU),
and under Rule 20(1) of the Working Procedures for Appellate Review

 The following notification, dated 25 March 2011, from the Delegation of the European
Union, is being circulated to Members.

 Pursuant to Article 16.4 and Article 17.1 of the DSU the European Union hereby notifies to
the Dispute Settlement Body its decision to appeal to the Appellate Body certain issues of law
covered in the Panel Report and cer tain legal interpretations devel oped by the Panel in the dispute
European Communities – Definitive Anti-Dumping Meas ures on Certain Iron or Steel Fasteners from
China (WT/DS397). Pursuant to Rule 20(1) of the Working Procedures for Appellate Review , the
European Union simultaneously files this Notice of Appeal with the Appellate Body Secretariat.

 For the reasons to be further elaborated in its submissions to the Appellate Body, the
European Union appeals, and requests the Appellate Body to reverse and/or modify the findings,
conclusions and recommendations of the Panel, with respect to the following errors of law and legal
interpretations contained in the Panel Report.

1On 1 December 2009, the Treaty of Lisbon ame nding the Treaty on European Union and the Treaty
establishing the European Community (done at Lisbon, 13 December 2007) entered into force. On
29 November 2009, the WTO received a Verbal Note (WT/L/779) from the Council of the European Union and
the Commission of the European Communities stating that, by virtue of the Treaty of Lisbon, as of
1 December 2009, the "European Union" replaces and succeeds the "European Community". On 13 July 2010,
the World Trade Organization received a Verbal Note (WT/Let/679) from the Counc il of the European Union
confirming that, with effect from 1 December 2009, the European Union replaced the European Community and
assumed all the rights and obligations of the European Community in respect of all Agreements for which the
Director-General of the World Trade Organization is the depositary and to which the European Community is a
signatory or a contracting party.

I. C
OUNCIL REGULATION NO. 1225/2009 ("THE BASIC AD REGULATION")

 The Panel erred in its interpretation and appl ication of Articles 6.10, 9.2 and 18.4 of the
Anti-Dumping Agreement, Article I:1 of the GATT 1994 and Article XVI:4 of the WTO Agreement
and failed to make an objective assessment pursuant to Article 11 of the DSU when it concluded that
Article 9(5) of the Basic AD Regulation is, as such, inconsistent with those provisions.2 In particular:

(a) the Panel erred in the application of Article 6.10 of the Anti-Dumping Agreement
when finding that Article 9(5) of the Basic AD Regulation concerns not only the
imposition of anti-dumping duties but also the calculation of margins of dumping.
3
Based on its incorrect understanding of the scope of Article 9(5) of the Basic AD
Regulation, the Panel wrongly concluded that Article 9(5) of the Basic AD
Regulation, as such, is inconsis tent with Article 6.10 of the Anti-Dumping
Agreement4;
(b) the Panel erred in the interpretation a nd application of Article 6.10 of the
Anti-Dumping Agreement and also violated Article 11 of the DSU when finding that
Article 9(5) of the Basic AD Regulation is, as such, inconsistent with Article 6.10 of
the Anti-Dumping Agreement in that it conditions the calculation of individual
margins for producers from non-market economy countries on the fulfilment of the
Individual Treatment (IT) test
5;
(c) the Panel erred in the interpretation a nd application of Article 9.2 of the
Anti-Dumping Agreement and also violated Article 11 of the DSU when finding that
Article 9(5) of the Basic AD Regulation is, as such, inconsistent with the obligation
laid down in Article 9.2 of the Anti-Dumping Agreement, which does not allow the
imposition of a single country-wide anti-dumping duty in an investigation involving a
non-market economy country
6;
(d) the Panel erred in the interpretation an d application of Article I:1 of the GATT 1994
and also violated Article 11 of the DSU when finding that Article 9(5) of the Basic
AD Regulation violates the MFN obligation of Article I:1 of the GATT 1994 .7
Moreover, the Panel erred when concluding that the Anti-Dumping Agreement does
not allow for the different treatment of imports from non-market economy countries
provided for in Article 9(5) of the Basic AD Regulation8; and
(e) the Panel erred when finding that the EU act ed inconsistently with Article XVI:4 of
the WTO Agreement and Article 18.4 of the Anti-Dumping Agreement by failing to
ensure the conformity of its laws, regula tions and administrative procedures with its
obligations under the relevant agreements.9

2Panel Report, para. 8(2)(a).
3Panel Report, para. 7.77.
4Panel Report, para. 7.98.
5Panel Report, paras. 7.96 and 7.98.
6Panel Report, para. 7.112 and footnote 278.
7Panel Report, paras. 7.124, 7.126 and 7.127.
8Panel Report, para. 7.125 and footnote 307.
9Panel Report, para. 7.137.

II. C OUNCIL REGULATION NO. 91/2009 (FASTENERS INVESTIGATION)

 The Panel erred in the interpretation and appli cation of Articles 6.2, 6.4, 6.5, 6.5.1, 6.10
and 9.2 of the Anti-Dumping Agreement and also violated Articles 6.2, 7.1 and 11 of the DSU when it
concluded that the EU acted inconsis tently with those provisions of the Anti-Dumping Agreement in
the fasteners investigation.10 In particular:

(a) the Panel erred in its interpretation and a pplication of Articles 6.10 and 9.2 of the
Anti-Dumping Agreement when finding that, having found that Article 9(5) of the
Basic AD Regulation is, as such, inconsistent with those provisions, its application in
the fasteners investigation was, for the same reasons, inconsistent with these two
provisions11;
(b) the Panel erred in the interpretation and a pplication of Articles 6.2 and 6.4 of the
Anti-Dumping Agreement and violated Article 11 of the DSU when finding that the
EU violated these provisions by not providing a timely opportunity for Chinese
producers to see information regarding the product types on the basis of which
normal value was established, information relevant to the presentation of their case12;
(c) the Panel erred in the interpretation a nd application of Article 6.5.1 of the
Anti-Dumping Agreement when finding that the European investigating authorities
had violated that provision in that they fa iled to ensure Agrati's and Fontana Luigi's
compliance with the requirements of Article 6.5.113;
(d) the Panel acted inconsistently with Articles 6.2, 7.1 and 11 of the DSU when
addressing in substance China's claim under Article 6.5 of the Anti-Dumping
Agreement in connection with Pooja Forge14;
(e) the Panel erred in the interpretation a nd application of Article 6.5 of the
Anti-Dumping Agreement when it considered that, absent a showing of "good cause",
the European investigating authorities were not entitled to grant confidential
treatment to information submitted by P ooja Forge, the analogue country producer 15;
and
(f) the Panel acted inconsistently with Article 6.2 of the DSU when considering that the
issue of "the identity of the complainants and supporters" was properly identified in
China's Panel Request under its claims referring to Article 6.2 and 6.4 of the
Anti-Dumping Agreement.
16

10Panel Report, paras. 8(2)(b), 8(2)(e) and 8(2)(f).
11Panel Report, para. 7.148.
12Panel Report, paras. 7.494 and 7.495.
13Panel Report, paras. 7.516 and 7.517.
14Panel Report, paras. 7.518-7.526.
15Panel Report, para. 7.525.
16Panel Report, para. 7.458.

ANNEX II

5 April 2011
 (11-1682)
 Original: English

EUROPEAN COMMUNITIES
1 – DEFINITIVE ANTI-DUMPING MEASURES
ON CERTAIN IRON OR STEEL FASTENERS FROM CHINA

Notification of an Other Appeal by China
under Article 16.4 and Article 17 of the Understanding on Rules
and Procedures Governing the Settlement of Disputes (DSU),
and under Rule 23(1) of the Working Procedures for Appellate Review

 The following notification, dated 30 Ma rch 2011, from the Delegation of the People's
Republic of China, is being circulated to Members.

 Pursuant to Article 16.4 and Article 17 of the DSU, the People's Republic of China hereby
notifies to the Dispute Settlement Body its decision to appeal to the Appellate Body certain issues of
law covered in the Report of the Panel and certain le gal interpretations developed by the Panel in its
Report in the dispute (WT/DS397/R). Pursuant to Rule 23(1) of the Working Procedures for
Appellate Review, China simultaneously files this Notice of Other Appeal with the Appellate Body
Secretariat.

 China seeks review by the Appellate Body of th e following aspects of the Report of the Panel:

1. China seeks review of the Panel's conclusions and findings concerning China's claim that the
European Union violated Articles 4.1 and 3.1 of th e AD Agreement with respect to the definition of
domestic industry in the fasteners investigation by excluding from the definition of the domestic
industry the producers that made themselves known after the 15-day deadline following the

1On 1 December 2009, the Treaty of Lisbon amending the Treaty on European Union and the Treaty
establishing the European Community (done at Lisbon, 13 December 2007) entered into force. On
29 November 2009, the World Trade Or ganization received a Verbal Note (W T/L/779) from the Council of the
European Union and the Commission of the European Communities stating that, by virtue of the Treaty of
Lisbon, as of 1 December 2009, the "European Union" replaces and succeeds the "European Community". On
13 July 2010, the World Trade Organi zation received a second Verbal Note (WT/Let/679) from the Council of
the European Union confirming that , with effect from 1 December 2009 , the European Union replaced the
European Community and assumed all the rights and obligations of the European Community in respect of all
Agreements for which the Director-General of the World Trade Organization is the depositary and to which the
European Community is a signatory or a contracting party.

publication of the Notice of Initiation and the producers that did not support the complaint
(paragraphs 7.209 – 7.221 and paragraph 8.3(b) of the Panel Report). China has identified, inter alia,
the following errors in the issues of law and legal interpretations developed by the Panel:
 The Panel failed to make an objective assessment of the facts in violation of, inter
alia, Article 11 of the DSU and Article 17.6 of the AD Agreement in connection with
China's claim that the EU violated Artic les 4.1 and 3.1 of the AD Agreement by
excluding from the definition of the domestic industry producers that did not support
the complaint, since:

- the Panel erroneously accepted as a "fact" the unsubstantiated statement of the
EU that "at least one producer which was not a complainant, and had
remained silent prior to initiation, was not only included in the domestic
industry, but was selected for the sample"
2;
- the Panel erroneously concluded that the fact that "at least one producer which
was not a complainant, and had remained silent prior to initiation, was not
only included in the domestic industry, but was selected for the sample"
demonstrated that "the EU investigating authority, in this case, did [not], in
fact, exclude producers that did not support the complaint from the domestic
industry"
3 and erroneously ignored the e xplanation put forward by China
pointing out that such conclusion cannot be and was not correct;
- the Panel disregarded and ignored the evidence submitted by China which
demonstrated that the EU excluded from the domestic industry all producers
that did not support the complaint.
 China requests the Appellate Body to reverse th e Panel's findings and to complete the analysis
by finding that it has been demonstrated that the EU excluded from the definition of the domestic
industry the producers that did not support the compla int. China further requests the Appellate Body
to complete the analysis by finding that the excl usion from the definition of the domestic industry of
the producers that did not support the complaint is inconsistent with Article 4.1 of the AD Agreement.

 The Panel erred in its interpretation of Article 4.1 of the AD Agreement when
examining China's claim that the exclusi on from the domestic industry of producers
that did not come forward within 15 days as of the date of publication of the Notice of
Initiation was inconsistent with Article 4.1 and failed to make an objective
assessment of the facts in violation of Artic le 11 of the DSU in connection with that
claim:

- the Panel failed to make an objective assessment of the facts as required by
Article 11 of the DSU when it concluded that the "EU did not act to exclude" 4
producers that did not make themselves known within 15 days as of the date
of initiation of the investigation;
- the Panel erred in its interpretation of Article 4.1 of the AD Agreement when
concluding that there is nothing in Article 4.1 which would preclude
investigating authorities from establishi ng deadlines for companies to come
forward in order to be considered for inclusion in the domestic industry;

2Panel Report, para. 7.214.
3 Panel Report, para. 7.215.
4 Panel Report, para. 7.215.

- the Panel failed to make an objective assessment of the facts as required by
Article 11 of the DSU when concluding that China has not demonstrated that
"the 15 days allowed by the Commission was insufficient".
5
 China requests the Appellate Body to reverse th e Panel's findings and to complete the analysis
by finding that, on the basis of the facts before the Panel, it has been demonstrated that the EU acted
to exclude from the definition of the domestic i ndustry the producers which did come forward within
15 days as of the date of publication of the Notice of Initiation and that, therefore, the EU acted in
violation of Article 4.1 of the AD Agreement. China furthermore requests the Appellate Body to
conclude that it has been demonstrated that the 15-day period granted to the domestic producers to
come forward was not "reasonable" or "sufficient" and that therefore the EU acted in violation of
Article 4.1 of the AD Agreement.

 The Panel erred in dismissing China's claim that the EU violated Article 3.1 of the
AD Agreement by excluding from the domestic industry the producers which did not
come forward within 15 days as of the date of the Notice of Initiation and the
producers which did not support the complaint.

 China requests the Appellate Body to reverse the Panel's findings and to conclude that the
EU violated Article 3.1 since it failed to make an injury determination which is based on an "objective
examination" as required by Article 3.1 of the AD Agreement.

2. China seeks review of the Panel's conclusions and findings concerning China's claim that the
European Union violated Articles 4.1 and 3.1 of th e AD Agreement with respect to the definition of
domestic industry in the fasteners investigation because the domestic industry as defined by the
EU did not include domestic producers whose collect ive output of the like product constitutes a major
proportion of the total domestic production (paragra phs 7.222 – 7.230 and para. 8.3(b) of the Panel
Report). China has identified, inter alia , the following errors in the issues of laws and of legal
interpretations developed by the Panel:
 The Panel failed to make a correct interp retation of the terms "major proportion"
which is based on the ordinary meaning of these terms and in light of their context,
pursuant to the principles of treaty interpretation of the Vienna Convention on the
Law of Treaties, and, as a result, ma de the following erroneous findings and
conclusions:

(i) the Panel erroneously concluded that the fact that the Commission relied on
a presumption is not alone sufficient to demonstrate, prima facie , that the
definition of the domestic industry in this case is inconsistent with
Article 4.1 of the AD Agreement;

(ii) the Panel erroneously concluded that the non-quantitative factors raised by
China are not relevant in this case or in general.

 China requests the Appellate Body to reverse the Panel's findings and to conclude that, by
considering that producers accounting for 25% of total domestic production necessarily constitute a
major proportion, the EU violated Article 4.1 of the AD Agreement and that the "non-quantitative
factors" identified by China are relevant for the purposes of determining whether the major proportion
requirement is satisfied and had to be considered by the Commission in the fasteners investigation.
China further requests the Appellate Body to concl ude that, in light of these non-quantitative factors,

5 Panel Report, para. 7.219.

the domestic producers constituting the domestic industry in the f asteners investigation did not
represent a "major proportion" of the domestic industry.

3. China seeks review of the Panel's conclusions and findings concerning China's claim that the
European Union violated Articles 3.1 and 4.1 of the AD Agreement since it made an injury
determination with respect to a sample of producer s that was not representative (paragraphs 7.234 to
7.241 and 8.3(b) of the Panel Report). China identified, inter alia, the following errors in the issues of
law and of legal interpretations developed by the Panel:
 The Panel erroneously concluded that " it cannot accept the contention that only a
statistically valid sample will be sufficientl y representative for purposes of an injury
determination";

 the Panel erroneously concluded that China has not demonstrated that the
EU investigating authority could have ca rried out its injury examination for the
domestic industry it had defined, or at least include more producers in the sample.

 China requests the Appellate Body to reverse the Panel's findings and to conclude that the
EU violated Article 3.1 of the AD Agreement.

4. China seeks review of the Panel's conclusions and findings concerning China's claim that the
European Union violated Article 2.4 of the AD Agre ement with respect to the dumping determination
in the fasteners investigation (paragraphs 7.291 – 7.311 and para. 8.3(d) of the Panel Report). China
has identified, inter alia, the following errors in the issues of la ws and legal interpretations developed
by the Panel:
 The Panel failed to make an objective assessment of the matter as required by
Article 11 of the DSU by failing to address China's argument that the EU violated
Article 2.4 since the Commission failed to indicate to the interested parties what
information was necessary to ensure a fair comparison and made it impossible for
them to claim adjustments for differences affecting price comparability and, to the
extent the Panel would have implicitly concluded that such a failure was not
inconsistent with Article 2.4 of the AD Agre ement, the Panel failed to make a correct
interpretation of Article 2.4 of the AD Agreement;

 the Panel erred in its interpretation of Article 2.4 of the AD Agreement when it
rejected China's argument that the EU violated Article 2.4 by failing to evaluate
whether the characteristics identified in th e PCNs affected price comparability and
whether adjustments for these differences in physical characteristics were warranted;

 the Panel did not make an objective assessment of the facts as required by Article 11
of the DSU and Article 17.6 of the AD Ag reement when it concluded that China has
pointed to no evidence supporting the conclusion that the PCN characteristics
indicated differences affecting price comp arability and when claiming that "it would
be inappropriate for us, under the standard of review to consider it ourselves";

 the Panel erred in its interpretation of Article 2.4 of the AD Agreement when it
rejected China's claim that the EU viol ated Article 2.4 of the AD Agreement by
failing to make the necessary adjustments for quality differences.

 China requests the Appellate Body to reverse th e Panel's findings and to conclude that, on the
basis of the facts before the Panel, it has been dem onstrated that the EU violated Article 2.4 of the
AD Agreement with respect to each of the identified issue mentioned above.

5. China seeks review of the Panel's conclusions and findings concerning China's claim that the
EU violated Articles 6.5, 6.4 and 6.2 of the AD Agreement in connection with the non-disclosure of
the identity of the complainants and of the suppor ters of the complaint (paragraphs 7.445 – 7.459 and
para. 8.3(h) of the Panel Report). China has identified, inter alia, the following errors in the issues of
laws and legal interpretations de veloped by the Panel in its findings concerning China's claim under
Article 6.5 of the AD Agreement:
 The Panel erred in its interpretation of the "good cause" requirement when ignoring
the difference between a hypothetical poten tial retaliation which "could" happen and
a retaliation which "would" happen;

 the Panel erred in law in considering that the "good cause" requirement was satisfied
without supporting evidence provided by the parties requesting confidential
treatment;

 the Panel erred in rejecting China's argument that no good cause was established
since the seven EU producers that made up the sample for purposes of the
Commission's injury determination were al so complainants and supporters and that
they did not ask the Commission to treat their identity as confidential information.

 China requests the Appellate Body to reverse the Panel's findings and to conclude that the
EU violated Article 6.5 of the AD Agreement through the non-disclosure of the identity of the
complainants and of the supporters of the complain t. China also requests the Appellate Body to
reverse the Panel's findings concerning China's claim under Articles 6.4 and 6.2 of the AD Agreement
and to complete the analysis by finding that the EU's failure to disclose the identity of the
complainants and of the supporters of the complaint is also inconsistent with Articles 6.4 and 6.2 of
the AD Agreement.

6. China seeks review of the Panel's conclusions and findings concerning China's claim that the
EU violated Article 6.1.1 of the AD Agreement by limiting the time period for the submission of
MET/IT claim form to 15 days as of the date of publication of the Notice of Initiation
(paragraphs 7.566 – 7.579 and 8.3(k) of th e Panel Report). China has identified, inter alia , the
following errors in the issues of law and legal interpretations developed by the Panel:
 The Panel erred in its interpretation of the te rm "questionnaire" in Article 6.1.1 of the
AD Agreement by adopting an interpretati on which is not consistent with the
ordinary meaning of that word in light of its context and the object and purpose as
required by the principles of treaty interp retation included in the Vienna Convention
on the Law of Treaties;

 even assuming that the Panel did not e rr in its interpretation of the term
"questionnaire" in that it would refer to "the initial comprehensive questionnaire
issued in an anti-dumping investigation to each of the interested parties by an
investigating authority at or following the initiation of an investigation, which seeks
information as to all relevant issues pertaini ng to the main questions that will need to
be decided (dumping, injury and causation) ", the Panel erroneously concluded that
that the MET/IT claim form was not a "questionnaire" according to this definition.

 China requests the Appellate Body to reverse the Panel's findings and to conclude that the
"MET/IT claim form" is a questionnaire within th e meaning of Article 6.1.1 of the AD Agreement
and to complete the analysis by finding that the EU violated Article 6.1.1 of the AD Agreement.