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WT/DS162/R/Add.1 Page 108

I.1

As concerns the meaning and scope of Article VI of the GATT 1994, the European Communities considers that Article VI clearly goes beyond creating an exception from other provisions of the GATT 1994; it has a broader scope.  It is clear from its opening words365 that its purpose is to provide a body of rules for dealing with the problem of dumping in international trade.

4.1

The European Communities notes that Article VI of the GATT 1994 acknowledges the existence of a particular problem in international trade and then proceeds to provide the solution.  Three steps are envisaged in this respect:  First, Article VI defines the practice of dumping.  Second, it sets out certain other conditions that need to be fulfilled for the application of remedial measures, such as the existence of injury.  And third, it authorizes the remedial measures which can be taken to deal with dumping.

4.2

Concerning the definition of dumping, the European Communities notes that its essential feature is that it is defined as relating exclusively to imports and to price discrimination in the form of higher prices on the market of the exporting country than on the market of the importing country.  As concerns the pre-conditions for taking action against dumping, the most important one is stated to be injury.  Article VI:1 provides that dumping as defined is "to be condemned" if it "causes or threatens material injury to an established industry in the territory of a contracting party or materially retards the establishment of a domestic industry […]".  Thereafter Article VI :2 proceeds to authorize the measure that can be taken against dumping:

"In order to offset or prevent dumping, a contracting party may levy on any dumped product an antidumping 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."

4.3

According to the European Communities, this language establishes the application of antidumping duties as the sole means authorized by the GATT 1994 by which a contracting party can seek to deal with the problem of dumped imports.

4.4

The European Communities further points out that it is only dumping meeting the definition in Article VI:1 of the GATT 1994 that is to be condemned, and then only in the stated circumstances of injury, threat of injury or material retardation.  Anti-dumping duties may be applied "in order to offset or prevent dumping", but only in an amount no greater than the margin of dumping as defined.  The reference to "offsetting" as well as "preventing" also makes clear that antidumping duties are the sole remedy established by the GATT 1994 for dealing with the problem of dumping, whether past, present or future.

4.5

The European Communities considers that the AntiDumping Agreement is fully consistent with this scheme of Article VI and defines in greater detail the conditions and in particular the requirements for an investigation that need to be fulfilled to allow antidumping action to be taken.  Article 1 of the Agreement confirms that an antidumping measure can be applied only under the circumstances provided for in Article VI of the GATT 1994 and pursuant to investigations conducted in accordance with the Agreement, while Article 18 of the same Agreement (which says that "no

365 The European Communities refers to the following language used in Article VI:

 "The contracting parties recognize that dumping, by which products of one country are introduced into the commerce of another country at less than the normal value of the products, is to be condemned if it causes or threatens material injury to an established industry in the territory of a contracting party or materially retards the establishment of a domestic industry […]."

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