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that the statute permitted alternative interpretations and that there was no express statutory language conflicting with the relevant international obligation. The court then held that the interpretation by the Commerce Department of the relevant statute as allowing a tax neutral methodology for calculating dumping margins was consistent with GATT principles and therefore permissible.
The United States submits that, in another case, Caterpillar Inc. v. United States47, the Court of International Trade applied the Charming Betsy doctrine in holding that the Customs Service's interpretation of a statute was impermissible because it conflicted with Article VII:3 of the GATT. The court first determined that there was no express language in the statute conflicting with this GATT provision. The court then held that, in accordance with the Charming Betsy doctrine, the statute should be construed in a manner consistent with international obligations. Because the Customs Service's interpretation was inconsistent, it was held to be impermissible.
The United States considers, finally, that, even without regard to judicial interpretations, the plain language of the 1916 Act is WTO‑consistent. Although the Third Circuit has held that the possibility of recoupment must be established under the 1916 Act, that is not the only WTO‑consistent interpretation. A review of the plain language of the 1916 Act shows that it is not a specific action against dumping. Rather, it is a measure directed at private predatory pricing practices. This reading of the plain language is confirmed by the statute's legislative history.
In response to a question of the Panel to both parties regarding whether there would be reasons to distinguish between, on the one hand, the situation where the terms of a law would make that law fall within the scope of a given provision of the WTO Agreement (e.g. Article VI of the GATT 1994) depending on the interpretation of those terms and, on the other hand, the situation where the applicability of a WTO provision is not in question (as was the case in United States – Tobacco), but where the law could be interpreted in such a way that it would violate that WTO provision, Japan notes that there would be.48
In Japan's view, "the situation where the terms of a law would make that law fall, or not, within the scope of a given provision of the WTO Agreement depending on the interpretation of those terms," is the situation where the authorities cannot apply the law in line with WTO obligations, because the terms of the law are so ambiguous that authorities cannot consistently interpret the law in line with WTO obligations. In this situation, since the law lacks the "sound legal basis" needed for domestic legislation to create the predictability to plan future trade, the law violates provisions of the WTO Agreement, as the Appellate Body found in India - Patents regarding the TRIPS Agreement.
Japan submits that, on the other hand, "the situation where the applicability of a WTO provision is not in question, but where that law could be interpreted in such a way that it would violate that WTO provision," is the situation that the authorities may have some discretion to apply the law in line with WTO obligations, because a range of meaning of the law is susceptible of WTO-consistent interpretation, as was the case with the United States - Tobacco panel's finding regarding Article VIII of the GATT 1947.
Japan recalls that, in the United States - Tobacco case, the panel found no violation because, due to the ambiguity in the terms of the law, the US Administration was not mandated to act in a manner that was inconsistent with the GATT 1947. However, this situation should be distinguished from "the situation where the terms of a law would make that law fall, or not, within the scope of a given provision of the WTO Agreement depending on the interpretation of those terms," particularly
47 The United States refers to Caterpillar Inc. v. United States, 941 F. Supp. 1241 (CIT 1996).
48 Japan notes, however, that the present case falls under neither of the situations hypothesized by the Panel.