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WT/DS162/R/Add.1 Page 58

1947 'grandfather clause' became no longer applicable."211

3.3

Japan notes that this issue had been addressed in 1986 by then-USTR Clayton Yeutter, who acknowledged in a letter to Congress that the 1916 "act was 'grandfathered' upon US accession to the GATT and is therefore GATT-legal."212  These statements clarify that, prior to the WTO agreements, the United States could maintain the 1916 Act only because of the grandfather clause.

3.4

According to Japan, these statements demonstrate that the United States, for years, has viewed the Act as GATT-inconsistent and as requiring grandfathering.  Coupled with the statements discussed below, they confirm that, for years, the US executive branch has considered the Act to be an antidumping law.

3.5

Japan submits that other relevant statements were made during the 1985 and 1987 attempts by some Congressmen to amend the 1916 Act.  S. 236 and S. 1655, which were not adopted, would have weakened the criteria for applying the 1916 Act.  USTR Clayton Yeutter and Assistant Attorney General John Bolton confirmed that the provisions of the 1916 Act establish liability against foreign companies that dump goods, as described in the 1916 Act, i.e. dumping calculated as the difference between the price in the US and the price in a foreign country.213

3.6

For Japan, the statements quoted above show that the US government consistently has viewed the Act as an antidumping law and that, absent grandfathering, it would have been GATT-illegal.  In this connection, the analysis of the 1916 Act presented by USTR General Council Alan Holmer to the US Senate Finance Committee (18 July 1986) is useful:

"We believe that our reading flows logically from the letter and spirit of the GATT and the AntiDumping Code.  It also follows that S. 1655 would violate the Code by imposing additional sanctions on top of normal antidumping duties.  While the same criticism can be levelled at the 1916 Act, the Act was "grandfathered" by the Protocol of Provisional application when the US joined the GATT in 1947.  Because of this legal technicality, the 1916 Act in its present form is legal under the GATT."214

3.7

In the view of the United States, the statements of various government officials regarding whether the 1916 Act was "grandfathered" under the GATT 1947 and whether proposed amendments to the 1916 Act would be GATTconsistent as evidence that the 1916 Act is an antidumping statute deserve no weight in the Panel's consideration for two reasons.  First, statements with respect to whether an amendment to the 1916 Act would be GATTconsistent are not relevant to the instant case because the amendments were never enacted.  Second, with respect to the statements on

211 Letter from USTR Charlene Barshefsky to Rep. Ralph Regula, dated 4 Apr. 1997, p. 1.

212 Japan refers to the Letter from USTR Clayton Yeutter to Sen. Strom Thurmond, dated 18 Feb. 1986, p. 10 (emphasis added by Japan).  Japan also references the letter from Assistant Attorney General John Bolton to Sen. S. Thurmond, dated 4 February 1986, which states that "[t]o the extent that any provisions of the current 1916 Act are inconsistent with the GATT, they are protected by the 'grandfather clause,' paragraph 1(b) of the 1947 Protocol of Provisional Application of the GATT."  Japan further refers to the Testimony of USTR General Counsel Alan Holmer to the US Senate Finance Committee, dated 18 July 1986, p. 5, which states that "the AntiDumping Act of 1916 […] was grandfathered by the Protocol of Provisional Application when the US joined the GATT in 1947.  Because of this legal technicality, the 1916 Act in its present form is legal under the GATT."

213 Japan refers to the letter from Assistant Attorney General John Bolton to Sen. Strom Thurmond, dated 4 February 1986.

214 Testimony of USTR General Counsel Alan Holmer to the US Senate Finance Committee, dated 18 July 1986, p. 5 (emphasis added by Japan).

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