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WT/DS162/R/Add.1 Page 63

G. VIOLATIONS OF ARTICLE VI:2 OF THE GATT 1994 AND ARTICLE 18.1 OF THE ANTI-DUMPING AGREEMENT

3.1

Japan argues that Article VI of the GATT 1994 and the many provisions of the AntiDumping Agreement set forth the only WTO-consistent means of addressing dumping.  They define dumping and set out the investigation a Member must conduct and the specific findings and determinations which a Member must make before it may impose an antidumping measure.  Also, they narrowly define the measure a Member may take.

3.2

Japan considers that Article VI of the GATT 1994 authorizes only one measure in response to dumping:  the imposition of an antidumping duty.225  Thus, assuming a Member has followed the requirements of Article VI:2 of the GATT 1994 and the AntiDumping Agreement, a Member has two options:  (i) it "may levy" an antidumping duty less than or equal to the margin of dumping on the dumped product; or (ii) it may decide to take no action.  Any other action would violate Article VI of the GATT 1994.226

3.3

Japan argues that its view is also supported by the negotiating history of Article VI of the GATT 1994.  After the close of the Havana Conference, at the second session of the contracting parties, the relevant Working Party in its Report "agreed that measures other than compensatory antidumping and countervailing duties may not be applied to counteract dumping or subsidization except insofar as such other measures are permitted under other provisions of the General Agreement."227

3.4

Japan submits that the overall purpose of the GATT 1994 bolsters this interpretation of Article VI:2 of the GATT 1994.  One of the main purposes of the GATT 1994 regime is to eliminate trade barriers among countries and to promote free trade.  Article VI of the GATT 1994 allows Members to do what they would not normally be allowed to do - to impede trade by imposing duties on imports in contravention of Article II of the GATT 1994.  Because Article VI of the GATT 1994 gives Members the right to impede trade in specified circumstances, it is only logical that Article VI of the GATT 1994 establishes the right to restrict dumped imports only by a single authorized remedy, namely imposing an "antidumping duty".

3.5

Japan considers that the text of Article 18.1 of the AntiDumping Agreement reaffirms the understanding that Article VI of the GATT 1994 is the sole GATT-authorized remedy for dumping.228  The plain meaning of this provision could not be more explicit.  "No specific action" can be taken to address dumping except action that follows the requirements of Article VI of the GATT 1994.

225 Japan refers to the text of Article VI:2 which reads:

"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 […]."

226 In response to a question of the Panel regarding how the parties understand the phrase "[i]n order to offset dumping […]" in Article VI:2 of the GATT 1994, Japan notes that this term informs the purpose of and rationale behind antidumping duty procedures.  The phrase and its context establish the reason why the measure to counter dumping is limited to a duty not greater than the dumping margin.  An antidumping duty not exceeding the margin of dumping is the sole authorized remedy for dumping.

227 Japan refers to the Report of the Working Party on "Modifications to the General Agreement," adopted on 1 and 2 September 1948, BISD II/39, para. 12.

228 Japan recalls that Article 18.1 provides as follows:

"No specific action against dumping of exports from another Member can be taken except in accordance with the provisions of GATT 1994, as interpreted by this Agreement."

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