WTO Appellate Body Supports U.S. Position on All Issues

WASHINGTON - The Office of the U.S. Trade Representative announced today that the WTO Appellate Body has ruled in favor of the United States on Mexico’s challenge to a U.S. antidumping proceeding on steel pipe from Mexico.  The dispute involved a U.S. “sunset review” on oil-country tubular goods (OCTG).  Sunset reviews determine whether duties on dumped imports should continue to remain in place for more than five years. 

“We are pleased with today’s report, which confirms our view that the United States conducted this antidumping proceeding in a manner consistent with our WTO obligations,” said USTR spokeswoman Christin Baker.  “We applaud the Appellate Body’s insistence that panel findings have a solid factual and analytical basis.  This report will further strengthen the effectiveness and credibility of the WTO dispute settlement system, and vindicates the application of U.S. trade remedy laws in this case.”

The Appellate Body reversed a WTO panel finding that the U.S. Department of Commerce’s Sunset Policy Bulletin, which provides guidance on Commerce's conduct of sunset reviews, is inconsistent with WTO rules, while upholding a finding that the U.S. International Trade Commission (USITC) had not broken WTO rules in the sunset proceeding on OCTG.  The United States did not appeal a separate finding that Commerce should have taken more evidence into account in the sunset proceeding, and Mexico did not appeal findings favoring the United States on its conduct of a separate proceeding on OCTG.

Background

The U.S. antidumping duty law requires that the Commerce Department conduct a “sunset review” every five years to examine whether dumping is likely to continue or recur if antidumping duties are removed.  In addition, the USITC must conduct a “sunset review” to examine whether revocation of the order is likely to lead to continuation or recurrence of injury to the U.S. industry within the reasonably foreseeable future.  In the case involving Mexican OCTG, the Commerce Department and the USITC determined that dumping and injury were likely to continue or recur absent the order, and, as a result, the United States kept the duties in place.

Mexico’s WTO challenge covered the sunset review and an administrative review by Commerce.  Only issues concerning the sunset review were appealed; the United States won with respect to the issues concerning the administrative review.

Mexico requested consultations on February 18, 2003.  Mexico requested the establishment of a panel on July 29, 2003, and a panel was established on August 29, 2003.   The Panel issued its report on June 20, 2005, Mexico filed its notice of appeal on August 4, 2005, and the United States filed its cross appeal on August 16, 2005.

Under WTO rules, the Appellate Body report and the panel report, as modified by the Appellate Body report, will be formally adopted by the WTO Dispute Settlement Body within 30 days; i.e., by December 2.

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