WTO Appellate Body Backs United States on Key Issue in Sunset Dispute
“Today’s report recognizes that U.S. laws on sunset reviews comply with our WTO obligations,” said USTR spokeswoman Gretchen Hamel. “We applaud the Appellate Body’s insistence that panel conclusions be supported by rigorous legal and factual analysis. The sunset waiver provisions enable participants in antidumping proceedings to allocate their resources effectively, and we are pleased that the Appellate Body upheld the U.S. statute.”
The Appellate Body report reverses an earlier panel finding against the U.S. statutory provision, which gives foreign companies the choice to waive participation in certain sunset review proceedings. The Appellate Body finding confirms that the United States has properly implemented 2006 WTO rulings against the statute and related regulations. The finding does not affect an adverse panel finding that the United States did not appeal against a specific U.S. sunset review involving certain pipe from Argentina.
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 U.S. International Trade Commission 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.
Argentina challenged the U.S. statutory and regulatory provisions that allow foreign companies to “waive” participation in the Commerce portion of the sunset review. In the original proceeding, the panel and the Appellate Body found in 2004that certain aspects of the waiver provisions breached U.S. WTO obligations. The Commerce Department amended its regulations to eliminate the WTO inconsistency. However, Argentina contended that the regulatory amendments were insufficient and requested the establishment of a compliance panel on January 26, 2006. The panel was established on March 17, 2006, and the panel circulated its report on November 30, 2006. The United States filed its notice of appeal on January 12, 2007, and Argentina filed its cross appeal on January 24, 2007.
Argentina had also challenged a specific sunset determination involving certain pipe. In the original proceeding, the panel made adverse findings regarding that determination, which the United States did not appeal. The Commerce Department subsequently conducted a redetermination, which Argentina challenged as part of this compliance proceeding. The compliance panel found that the redetermination was not consistent with U.S. WTO obligations. The United States did not appeal that finding. The United States did appeal a procedural finding that part of that redetermination was within the scope of the compliance proceeding. The Appellate Body disagreed with the United States with respect to that procedural question.
Under WTO rules, the Appellate Body report and the panel report, as modified by the Appellate Body report, would be expected to be formally adopted by the WTO Dispute Settlement Body within 30 days, i.e., by May 11, 2007.