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WT/DS162/R/Add.1 Page 112

The imposition of duties is additionally limited in those paragraphs of Article VI of the GATT 1994 that prohibit parties from cumulating antidumping and countervailing duties to counter the same practice.  It cannot go unnoticed that all those limitations and qualifications applying to the imposition of antidumping duties would have absolutely no purpose and absolutely no result if WTO Members were free to choose any other type of measure and then with no maximum limits as to amount and impact.


The European Communities recalls that the remedial measures provided for by the 1916 Act are treble damages and/or criminal penalties (fines and/or imprisonment).  These remedies are not duties.  As made clear above, they do not fall into the only type of measures allowed under multilateral antidumping rules to counter dumping practices, nor are they authorized by other WTO provisions.


In the view of the European Communities, recognition of the foregoing was again made by the US authorities.  In that respect, the European Communities simply refers the Panel to the testimony of USTR General Counsel Alan Holmer to the US Senate Finance Committee, dated 18 July 1986.  The only comment that may be added to this eminently clear statement made by Mr. Holmer is that Article 16 of the 1979 AntiDumping Code is identical to Article 18 of the WTO AntiDumping Agreement.


The European Communities considers that the compensatory, remedial objective (in economic terms) of the measure authorized in Article VI assumes that only a quantifiable price measure offsetting a precisely quantified dumping margin (or possibly, lower injury level) may be adopted.  In other words, only a measure increasing the costs of the exporters up to the point of somehow forcing them to raise prices on their export markets where they have been found to dump is really fit to "offset" dumping (in the sense of a dumping margin, or possibly an injury level).  On the other hand, this remedial objective can certainly not be served by criminal liability.  The presence of pecuniary criminal sanctions bears no relation to the margin of dumping.


In the view of the European Communities, the United States is reading Article VI:2 of the GATT 1994 out of context and contrary to its clear object and purpose.  A provision in an Agreement such as the GATT 1994 stating that something "may" be done does not necessarily mean that any alternative action, which could be more or less restrictive of trade, is in no way restricted.  Whether it has this meaning or whether it implies on the contrary that no other action may be taken depends on the context in which the word "may" is being used.  The context of Article VI comprises the structure of the GATT 1994.  It is important to note that Articles III to XIX of the GATT 1994 regulate problems in international trade.  Thus, Article VI regulates the action that Members may take against dumping and the conditions under which they may take this action.  Article VI:2 expressly states that the action which may be taken is to levy an antidumping duty.  When read in context and in the light of its object and purpose, Article VI prevents Members to take other action than duties to counter dumping, for example imprisoning the importers.


Addressing the negotiating history of Article VI, the European Communities notes that, despite attempts by some contracting parties to the GATT 1947 to provide for other types of offsetting measures than duties, both during the preparatory work and the Review Session of 1955, Article VI was intentionally limited to antidumping duties.  The European Communities notably recalls that the 1948 Working Party on "Modifications to the General Agreement" noted, in respect of the current text of Article VI (corresponding to Article 34 Havana Charter):

"While agreeing that there is no substantive difference between Article VI of the General Agreement and Article 34 of the Charter, the working party recommends the replacement of that article, as the text adopted at Havana contains a useful indication of the principle governing the operation of that Article and constitutes a clearer

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