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WT/DS162/R/Add.1 Page 102

a duty, nor a type of other charge.  Equally obvious is the fact that the fine, treble damages and cost recovery are not duties or taxes.  Likewise, they are not the type of "other charges" contemplated by Article XI:1.347  Thus, this second element is satisfied, not merely by the imprisonment penalty, but also by the other impermissible penalties.


Japan submits, third, that the 1916 Act applies to the importation of products into the United States.  The 1916 Act makes it unlawful to "import or cause to be imported or sold" any goods "from any foreign country into the United States" under certain conditions.  


Japan notes, moreover, that one of the conditions for the importation to be unlawful is that the goods be dumped, or imported or sold in the United States at a price substantially less than their "actual market value or wholesale price".  Specifically, the Act applies to goods

"[…] imported or sold […] within the United States at a price substantially less than the actual market value or wholesale price […] in the principal markets of the country of their production, or of other foreign countries to which they are commonly exported after adding to such market value or wholesale price, freight, duty, and other charges and expenses necessarily incident to the importation and sale […]."

This requirement highlights the fact that the 1916 Act is a measure applying to the importation of products into the United States.  In essence, the 1916 Act establishes product-specific minimum price levels to protect US industries.  Thus, it functions similarly to the minimum import price system declared inconsistent with Article XI of the GATT 1994 by the panel in EEC - Programme of Minimum Import Prices, Licenses and Surety Deposits for Certain Processed Fruits and Vegetables.348 Furthermore, the application of the Act is not limited to a specific product, but is open to any product.  The 1916 Act is a restriction that applies to imports within the meaning of Article XI of the GATT 1994.


Japan argues that the fact that the 1916 Act applies to "any person importing or assisting in importing any articles" is immaterial.  As held by the panel in United States - Section 337, in the context of Article III of the GATT 1994, a measure applied to importers by imposing penalties on them also affects imported products.349  In the context of Article XI, it does so by imposing restrictions on them.


Japan considers, therefore, that, as demonstrated above, the 1916 Act violates Article XI:1 of the GATT 1994.


The United States notes that, in general, Article XI prohibits, with certain exceptions, quantitative restrictions on imports or exports.  Because the 1916 Act contains no provision which would enable a court to impose any sort of prohibition or restriction upon the importation of products, the Panel should reject this claim.  In fact, the only court to have specifically considered whether the

347 Japan points out that Article VIII of the GATT 1994 enumerates the types of permissible charges contemplated by Article XI, as well as Articles I and II, of the GATT 1994.

348 Japan refers to the Panel Report on EEC - Programme of Minimum Import Prices, Licenses and Surety Deposits for Certain Processed Fruits and Vegetables, adopted on 18 October 1978, BISD 25S/68, para. 4.9 (hereinafter "EEC – Minimum Import Prices") (holding, according to Japan, that the EEC's minimum import price system was a "restriction 'other than duties, taxes or other charges' within the meaning of Article XI:1").  Japan also refers to Japan - Semi-conductors, para. 29 (extending, according to Japan, the principle that restrictions on imports of goods below certain prices violate Article XI:1 to a situation in which restrictions applied to exports of goods below certain prices.).

349 Japan refers to United States – Section 337,  Op. Cit., para. 5.10.

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