Statements by the United States at the June 17, 2011 DSB Meeting


1.         SURVEILLANCE OF IMPLEMENTATION OF RECOMMENDATIONS ADOPTED BY THE DSB

A.        UNITED STATES – SECTION 211 OMNIBUS APPROPRIATIONS ACT OF 1998:  STATUS REPORT BY THE UNITED STATES (WT/DS176/11/ADD.103)

The United States provided a status report in this dispute on June 6, 2011, in accordance with Article 21.6 of the DSU.

Legislative proposals have been introduced in the current 112th Congress that would implement the recommendations and rulings of the DSB.

The U.S. Administration will continue to work on solutions to implement the DSB’s recommendations and rulings.

[Second intervention:]

In response to “systemic” concerns voiced in certain interventions, as we have noted on previous occasions, for those few disputes where U.S. efforts to come into compliance have not yet been entirely successful, the United States has been working actively towards compliance in furtherance of the purpose of the dispute settlement system.

In this dispute, we have previously provided some detail on those efforts.  In the U.S. Senate, the bill S. 603 was introduced on March 16, 2011.  This bill has been referred to the Senate Committee on the Judiciary.  In the U.S. House of Representatives, H.R. 1166 was introduced on March 17, 2011.  This bill has been referred to the House Committee on the Judiciary.

B.        UNITED STATES – ANTI?DUMPING MEASURES ON CERTAIN HOT?ROLLED STEEL PRODUCTS FROM JAPAN:  STATUS REPORT BY THE UNITED STATES (WT/DS184/15/ADD.103)

The United States provided a status report in this dispute on June 6, 2011, in accordance with Article 21.6 of the DSU.

As of November 2002, the U.S. authorities had addressed the DSB’s recommendations and rulings with respect to the calculation of antidumping margins in the hot-rolled steel antidumping duty investigation at issue in this dispute.

With respect to the recommendations and rulings of the DSB that were not already addressed by the U.S. authorities, the U.S. Administration will work with the U.S. Congress with respect to appropriate statutory measures that would resolve this matter.

C.        UNITED STATES – SECTION 110(5) OF THE US COPYRIGHT ACT:  STATUS REPORT BY THE UNITED STATES (WT/DS160/24/ADD.78)

The United States provided a status report in this dispute on June 6, 2011, in accordance with Article 21.6 of the DSU.

The U.S. Administration will continue to confer with the European Union, and to work closely with the U.S. Congress, in order to reach a mutually satisfactory resolution of this matter.

D.        EUROPEAN COMMUNITIES – MEASURES AFFECTING THE APPROVAL AND MARKETING OF BIOTECH PRODUCTS:  STATUS  REPORT BY THE EUROPEAN UNION (WT/DS291/37/ADD.41)

The United States thanks the EU for its status report and its statement today.

The United States welcomes the information provided just now that the EU expects to make today its first biotech approvals since July 2010.  Unfortunately, dozens of biotech applications still remain pending in the EU approval system.  These pending applications include applications for the approval of products that the Dispute Settlement Body specifically identified as being unduly delayed in contravention of the EU’s obligations under the Agreement on the Application of Sanitary and Phytosanitary Measures.

Many of the pending applications already have received favorable assessments from the EU’s own scientific authority.

After a favorable scientific review, the next step in the EU’s approval process is for an  application to be considered during one of the monthly meetings of a regulatory committee.

However, the EU recently has been cancelling the monthly meetings of the regulatory committee that considers biotech products.  The EU canceled its scheduled meeting for June, and this is the third cancellation in 2011.

The EU’s decisions not to hold meetings to consider pending biotech applications appears to be contributing to delays in approvals.

The United States would ask the EU to take steps to address these matters.

E.         UNITED STATES ? MEASURES RELATING TO ZEROING AND SUNSET REVIEWS:  STATUS REPORT BY THE UNITED STATES (WT/DS322/36/ADD.21)

The United States provided a status report in this dispute on June 6, 2011, in accordance with Article 21.6 of the DSU.

As the United States explained in its status report, in December 2010 the U.S. Department of Commerce announced a proposal to change the calculation of weighted average dumping margins and assessment rates in certain antidumping proceedings. At this time, the U.S. Department of Commerce is continuing with its ongoing work on the December proposal.

F.         UNITED STATES – CONTINUED EXISTENCE AND APPLICATION OF ZEROING METHODOLOGY:  STATUS REPORT BY THE UNITED STATES (WT/DS350/18/ADD.18)

The United States has addressed the issue of compliance with the findings in this dispute in the status report provided on June 6, 2011, and earlier in today’s discussion of agenda item 1.E.  We refer Members to that report and statement for further details.

G.        UNITED STATES ? LAWS, REGULATIONS AND METHODOLOGY FOR CALCULATING DUMPING MARGINS (“ZEROING”):  STATUS REPORT BY THE UNITED STATES (WT/DS294/38/ADD.12)

The United States has addressed the issue of compliance with the findings in this dispute in the status report provided on June 6, 2011, and earlier in today’s discussion of agenda item 1.E.  We refer Members to that report and statement for further details.

H.        CHINA – MEASURES AFFECTING TRADING RIGHTS AND DISTRIBUTION SERVICES FOR CERTAIN PUBLICATIONS AND AUDIOVISUAL ENTERTAINMENT PRODUCTS:  STATUS REPORT BY CHINA (WT/DS363/17/ADD.5)

The United States thanks China for its status report and its statement today.

The United States remains concerned by the lack of progress by China in bringing its measures relating to films for theatrical release into compliance with the DSB recommendations and rulings.

The United States also has significant concerns about the incomplete progress relative to China’s measures relating to audio visual home entertainment products, reading materials, and sound recordings.

The United States is conferring with China on these matters.  The United States hopes that China will take steps to resolve this matter soon.

 

2.         EUROPEAN COMMUNITIES AND CERTAIN MEMBER STATES – MEASURES AFFECTING TRADE IN LARGE CIVIL AIRCRAFT

A.        IMPLEMENTATION OF THE RECOMMENDATIONS OF THE DSB

The United States welcomes the statement of the EU that it will comply with the DSB recommendations and rulings in this dispute.

Article 7.9 of the Subsidies Agreement provides a six-month period from adoption of the panel and Appellate Body reports for the EU and its member States to take appropriate steps either to withdraw the subsidies or to remove the adverse affects of the subsidies.  That six-month period expires on December 1, 2011.

The United States recalls that the subsidies found to be WTO- inconsistent, including launch aid, equity financing, and infrastructure payments, were enormous.  We also recall that these subsidies were found to have caused adverse effects of lost market share in some of the biggest aircraft markets in the world and lost sales totaling hundreds of aircraft.

Accordingly, full compliance in this dispute, by the EU and four of its member States withdrawing these enormous subsidies or removing their adverse effects, will be economically very significant for the United States.

The United States will monitor developments in the EU closely.  We remain ready to work with the EU and the member States as they move forward on implementation.
3.         UNITED STATES – CONTINUED DUMPING AND SUBSIDY OFFSET ACT OF 2000: IMPLEMENTATION OF THE RECOMMENDATIONS ADOPTED BY THE DSB

A.        STATEMENTS BY THE EUROPEAN UNION AND JAPAN

As the United States has explained at previous DSB meetings, the President signed the Deficit Reduction Act into law on February 8, 2006.  That Act includes a provision repealing the Continued Dumping and Subsidy Offset Act of 2000.  Thus, the United States has taken all actions necessary to implement the DSB’s recommendations and rulings in these disputes.

We welcome the EU’s recognition that the 2006 Deficit Reduction Act does not permit the distribution of duties collected on goods entered after October 1, 2007.

We therefore do not understand the purpose for which the EU and Japan have inscribed this item today.

With respect to comments regarding further status reports in this matter, the United States fails to see what purpose would be served by further submission of status reports repeating, again, that the United States has taken all actions necessary to implement the DSB’s recommendations and rulings in these disputes.

Finally, in relation to the EU’s statement referring to its “annual adjustment”, as previously stated, the United States will be reviewing carefully the measures taken by the EU.  As we have observed previously, the DSB only authorized the suspension of concessions or other obligations as provided in the Award of the Arbitrator.

7.         UNITED STATES – ANTI?DUMPING ADMINISTRATIVE REVIEWS AND OTHER MEASURES RELATED TO IMPORTS OF CERTAIN ORANGE JUICE FROM BRAZIL

A.        REPORT OF THE PANEL (WT/DS382/R)

The United States would like to begin by thanking the members of the Panel and the Secretariat for their work on this dispute.

The United States has made very clear its significant concerns with the Appellate Body’s evaluation of the WTO-consistency of “zeroing” in past disputes.  We will not repeat our concerns here today.  We continue to believe that those reports go beyond what the text of the agreements provides and what negotiators agreed to in the Uruguay Round.

Although the panel in the Orange Juice dispute ultimately elected to adhere to rulings on “zeroing” made by the Appellate Body in past disputes, the United States recognizes the Panel’s careful, independent assessment as reflected in its reasoning on the issue.

The Panel, like previous panels, properly understood that the Antidumping Agreement could be permissibly interpreted as allowing the use of zeroing in reviews.  The Panel explained that “there exists no single answer” to the question of whether “dumping” can be defined on a transaction-specific basis or, rather, whether it must be defined for the “product as a whole”.[1]

In addition, the Panel expressly acknowledged:

“the objective lack of clarity in the current definition of ‘dumping’ that is set forth in the AD Agreement (a conclusion which [the Panel] believes is inescapable after almost a decade of unprecedented, and often conflicting, panel and Appellate Body opinions on the matter).”[2]

But in the end, notwithstanding its own independent view and the standard of review set out in Article 17.6 of the Antidumping Agreement, the Panel, in its own words, “follow[ed] the Appellate Body”, and found that “zeroing” is inconsistent with the WTO Agreement.[3]

In addition to concerns about the finding on “zeroing,” the United States has concerns that the Panel chose to base the ultimate outcome of the Orange Juice dispute not on its own interpretation of the WTO Agreement texts, but on findings reached in other disputes.  The DSU does not establish a system in which panel or Appellate Body reports become binding precedents.  Instead, the WTO Agreement[4] explicitly reserves to Members, in the Ministerial Conference or the General Council, the “exclusive authority” to issue binding – or what the DSU[5] refers to as “authoritative” – interpretations of the covered agreements.

The United States also notes that this express reservation of authority should not be disregarded – as some have argued – in the name of “security and predictability”.  Security and predictability in the system are not advanced when, as is the case with “zeroing,” the results of dispute settlement have the effect of adding to or diminishing the rights and obligations to which the Members agreed in the text of the covered agreements.

Notwithstanding our systemic concerns about the findings in this and earlier zeroing disputes, the United States recognizes the systemic importance of compliance with dispute settlement findings.  To that end, we have devoted significant resources to comply with the recommendations and rulings in zeroing disputes.  As we have previously explained to the DSB, the U.S. Department of Commerce has announced a proposal to change the calculation of weighted average dumping margins and assessment rates in certain antidumping proceedings.

In this light, and as previously agreed with Brazil, the United States would like to state that it intends to implement the recommendations and rulings of the DSB in this dispute in a manner that respects U.S. WTO obligations and that it will need a reasonable period of time (RPT) in which to implement.  As mentioned by Brazil in its statement, Brazil and the United States have further reached an agreement regarding an appropriate RPT, and we will be circulating this agreement to Members shortly.

 


[1] Panel Report, para. 8.1.

[2] Panel Report, para. 7.134.

[3] Panel Report, para. 7.135.

[4] WTO Agreement, Article IX:2.

[5] DSU, Article 3.9.