For these reasons, we conclude that the European Communities? determination that all imports attributable to non-examined producers were dumped ?even though the evidence from examined producers showed that producers accounting for 53 per cent of imports attributed to examined producers were not dumping ?did not lead to a result that was unbiased, even-handed, and fair. Therefore, the European Communities did not satisfy the requirements of paragraphs 1 and 2 of Article 3 to determine the volume of dumped imports on the basis of an examination that is ?i>objective??sup id="fntext-276">(276)

205.   In Korea ?Certain Paper, the Panel recognized the investigating authority’s discretion regarding the conclusions it draws in respect of the results of price analysis as long as it adheres to the requirements of Article 3.1 of the Anti-Dumping Agreement:

“[A]s long as the IA’s analysis conforms to the requirements of Article 3.1 of the Agreement, that is, an objective examination based on positive evidence, changes in the relative levels of prices of dumped imports and the domestic industry during the POI do not necessarily preclude the IA from concluding that dumped imports had negative effects on prices.⁽²⁷⁷⁾?sup id="fntext-278">(278)

206.   In EC ?Fasteners (China), the Panel considered a claim regarding inclusion of two Chinese producers for which zero margins were calculated in the volume of imports considered in the injury analysis; the EU argued that the impact of this inclusion was small. The Panel noted that “the text of the AD Agreement is perfectly clear in this regard ?the consideration of ‘dumped imports?for purposes of making an injury determination consistent with Articles 3.1, 3.2, 3.4 and 3.5 of the AD Agreement entails the consideration of only those imports for which a margin of dumping greater than de minimis is established in the course of the investigation.?⁽²⁷⁹⁾ The Panel further noted that the EU knew or should have known that the information it was considering in examining the volume of dumped imports included imports that were not dumped, and found that “it is not appropriate for us to conclude that the investigating authority could have made an affirmative determination of injury in the absence of consideration of the volume of imports properly treated as dumped. Such an analysis would effectively constitute a de novo review of the evidence, which we are not to undertake under the applicable standard of review.?sup id="fntext-280">(280) The Panel concluded that the EU acted inconsistently with Articles 3.1 and 3.2 in considering the volume of dumped imports.⁽²⁸¹⁾

207.   In EC ?Fasteners (China), the Panel further considered the principle regarding non-consideration of injury caused by non-dumped imports, in relation to imports of producers/exporters not included in the sample used for the dumping determination and not separately granted individual examination. In the investigation at issue, the EU determined that all sampled producers were dumping and calculated a dumping margin for these non-sampled/unexamined producers on the basis of the dumping margins determined for the sampled producers. The two producers found not to be dumping were not included in the sample; because all producers in the sample were found to be dumping, the Panel considered that the EU authorities were entitled to rely on that evidence and treat all imports from non-sampled/ unexamined producers as dumped for purposes of its injury determination; the Panel rejected China’s claim under Articles 3.1 and 3.2.⁽²⁸²⁾ The Panel found:

“[T]he conclusion of the investigating authority with respect to the sampled producers, that they were dumping, is not undermined by the fact that two producers not included in the sample were found not to be dumping upon being individually examined. The purpose of sampling foreign producers/exporters in an anti-dumping investigation is to allow an investigating authority to extrapolate from the sample to draw conclusions about dumping for all non-sampled/unexamined foreign producers/ exporters on the basis of a detailed examination of fewer than all of them. Article 9.4 of the AD Agreement makes clear that, if the sample for the dumping determination is selected consistently with the AD Agreement, a matter China has not challenged in this dispute, then the investigating authority may treat the findings of dumping made with respect to that sample of companies as establishing the existence of dumping by all non-sampled/unexamined companies for purposes of the imposition of anti-dumping duties.

In our view, a similar result should follow with respect to the treatment of imports as dumped for purposes of the injury determination. That is, if the sample for the dumping determination is selected consistently with the AD Agreement, a matter China has not challenged in this dispute, then the investigating authority may treat the findings of dumping made with respect to that sample of companies as evidence that imports from the non-sampled/ unexamined companies are dumped. To do otherwise would limit the utility of Article 6.10 of the AD Agreement, as it would require the investigating authority to gather and consider information for non-sampled/ unexamined producers in order to be able to make individual judgments as to whether the imports from non-sampled/ unexamined producers are dumped, despite the decision to proceed on the basis of a sample.

?it seems inconsistent and illogical to accept that conclusions about dumping for sampled producers can be the basis for the imposition of anti-dumping duties on non-sampled/unexamined producers, but not to accept that those same conclusions about dumping may serve as evidence that imports attributable to non-sampled/ unexamined producers are dumped in the same investigation.?sup id="fntext-283">(283)

(iii) Relationship with Article 3.4

208.   In US ?Hot-Rolled Steel, the Appellate Body explained that “an important aspect of the ‘objective examination?required by Article 3.1 is further elaborated in Article 3.4 as an obligation to ‘examin[e] the impact of the dumped imports on the domestic industry?through ‘an evaluation of all relevant economic factors and indices having a bearing on the state of the industry’”.⁽²⁸⁴⁾ See also paragraphs 194 above and 243 below.

209.   The Panel in Argentina ?Poultry Anti-Dumping Duties considered that “to the extent that a Member failed to conduct a proper ‘examination of the impact of dumped imports?for the purpose of Article 3.4, that Member also failed to conduct an ‘objective examination of ?the consequent impact of the[] imports?within the meaning of Article 3.1(b).?sup id="fntext-285">(285)

(d) Volume and price effects

210.   The Panel in Mexico ?Steel Pipes and Tubes was mindful of the considerations outlined by the Appellate Body⁽²⁸⁶⁾ in Mexico ?Anti-Dumping Duties on Rice when it analysed the use of samples and six-month time periods in considering whether Mexico had violated Articles 3.1 and 3.2 in: (i) estimating the volume of imports of the product under investigation from countries other than Guatemala by using a non-representative sample; and (ii) evaluating the price effects of imports from Guatemala.⁽²⁸⁷⁾ On the volume point, the Panel considered that the investigating authority could have done more to ensure it received a statistically robust response, and was not convinced by Mexico’s arguments that it was not possible to do so:

“It seems to us that if Economía had made a request at or near the outset of the investigation, it could have received a comprehensive, or at least statistically robust, response well within the time-frames of this investigation. We would have vastly preferred that Economi´a acquire a comprehensive official data set ?or at least a statistically robust sample ?from the competent Mexican government agency. We believe that such information would have been the best available source to calculate volumes of imports from sources other than Guatemala. However, we are aware that, for certain Members, considerable periods of time may be needed in order to acquire such information from the competent government agencies, and that, for the purposes of conducting a timely investigation as required by the Agreement, it may not always be possible to acquire such information from a government source. In any event, we do not consider that simply by not seeking information from official government sources, Economía analysis would necessarily be flawed.?sup id="fntext-288">(288)

211.   The Panel in Mexico ?Steel Pipes and Tubes found that the investigating authority had indeed acted inconsistently with Articles 3.1 and 3.2 regarding the methodology to establish the volume of imports from sources other than Guatemala “due to the limited magnitude and consistency of samples, together with the unsubstantiated price range assumptions on which Economía relied to estimate the volume of subject imports imported from countries other than Guatemala. An investigating authority that uses a methodology premised on a limited sample and unsubstantiated assumptions does not conduct an examination based on positive evidence.?sup id="fntext-289">(289) However, in evaluating price effects of the imports from Guatemala, the Panel found that Guatemala had not established a prima facie case.⁽²⁹⁰⁾

212.   The Panel in EC ?Salmon (Norway) considered the Appellate Body’s finding in EC ?Bed Linen on the treatment of imports attributable to unexamined producers, finding the decision troubling. In the case before it the Panel found that the European Communities had erred in concluding that all examined producers were dumping:

“The Appellate Body noted that there was no specified methodology for determining the volume of dumped imports, but stated that any such methodology must be based on positive evidence and an objective examination of relevant evidence. The Appellate Body concluded that the fact that producers accounting for 47 per cent of total imports attributable to examined producers were found to be dumping was not a sufficient basis to justify treating imports from unexamined producers/exporters as dumped for purposes of the injury analysis. The Appellate Body determined that an objective examination of that evidence alone could not lead to the conclusion that imports from unexamined producers were dumped,⁽²⁹¹⁾ and concluded that there must be other evidence to justify treating imports from unexamined producers as dumped for purposes of the injury investigation.⁽²⁹²⁾ While a calculation of dumping margins for each individual producer/exporter was clearly not required, as Article 6.10 permitted limited examination, the Appellate Body considered that other evidence could be relied upon in determining whether imports from unexamined producers were dumped imports.

We are troubled by the Appellate Body’s decision in this regard. The Appellate Body’s report indicates that an investigating authority may consider ‘different and additional evidence?to evaluate whether imports from unexamined producers are dumped for purposes of injury analysis. In this regard, the Appellate Body’s Report refers to evidence ‘such as witness testimony and different types of documentary evidence about critical aspects of the market, conditions of competition, production characteristics, and statistical data relating to the volume, prices, and effects of imports?as evidence that may form part of the evidence an investigating authority may take into account ‘when determining, on the basis of an “objective examination? whether or not imports from non-examined producers are being dumped.? However, Article 2.1 of the AD Agreement makes clear that ‘a product is to be considered as being dumped?only if the export price is less than the normal value, and establishes detailed rules for that calculation. The Appellate Body has, in the context of sunset reviews, found that a determination of likelihood of dumping based on a dumping margin calculated using a methodology inconsistent with Article 2 of the AD Agreement is unacceptable. Thus, it is unclear to us how such ‘other evidence?can provide a legally sound basis for a conclusion that imports attributable to unexamined producers are dumped. In our view, the fact that imports from unexamined producers are, under the AD Agreement, recognized as dumped for purposes of the imposition of antidumping duties, and that those duties may be collected in amounts limited by calculations made pursuant to Article 2 of the AD Agreement, does establish a legally sound basis for the treatment of those imports as dumped for purposes of the injury analysis.

?In our view, a finding that all imports attributable to examined producers are dumped may be treated as evidence that all imports attributable to unexamined producers are dumped for purposes of the injury analysis without a further examination of the nature of the operations of examined and unexamined producers.⁽²⁹³⁾ Of course, in this case, the EC erred in concluding that all examined producers were dumping, as we have found above that the EC erred in treating imports from Nordlaks as ‘dumped imports? We have also found that the EC erred in the determination of the companies to be included in the group examined. Thus, not all examined sampled producers were found to be dumping, and to the extent that the EC extrapolated to all imports on the basis of a conclusion that all imports attributable to the examined producers were dumped, it erred.?sup id="fntext-294">(294)

213.   In conclusion, the Panel in EC ?Salmon (Norway) found that the European Communities had acted inconsistently with Articles 3.1 and 3.2 in considering the volume of dumped imports.

“Therefore, we conclude that that the EC erred in treating imports attributable to a company for which a de minimis margin was calculated as dumped, and further erred in treating all imports from unexamined producers and exporters as dumped, in the context of its injury determination. As a result, the EC acted inconsistently with Articles 3.1 and 3.2 in considering the volume of dumped imports.?sup id="fntext-295">(295)

214.   See also under Article 3.2 below.

(e) Injury

215.   The Panel in Mexico ?Steel Pipes and Tubes considered a claim by Guatemala that the Mexican investigating authority’s injury analysis was based on “selective and inconsistent use of information pertaining to the domestic industry.?sup id="fntext-296">(296) The Panel recalled that the investigating authority had defined the domestic industry as being constituted of four firms: Hylsa, Tuberias Procarsa, Tuberia Nacional and Compania Mexicana de Tubos. However, for the purpose of the injury analysis the investigating authority relied upon information on the economic indicators of three firms constituting 88 per cent of the domestic industry.⁽²⁹⁷⁾ For financial information only 53 per cent of the domestic industry was used.⁽²⁹⁸⁾ The Panel found that examining only a part of the industry as defined by the investigating authority was not an objective examination of positive evidence. While the data in respect of examining economic injury factors, in the circumstances of this case, might have been acceptable, the data regarding financial factors was not:

“We are of the view that once an investigating authority defines which entities comprise the domestic industry that will form the basis for its injury analysis, it should seek and use a consistent data-set reflecting the performance of those entities. We understand that, in practice, an investigating authority could have partial information to start an investigation, which might then be supplemented as the investigation proceeds. An investigating authority may also be confronted with problematic incomplete data furnished by one or more domestic producers. In such a case, it should request supplementary information, or, if that is not practicable, resort to a reasonable estimation methodology which will yield results that are reflective of the state of the domestic industry. This is because the requirement is to determine whether the domestic industry, as defined, is injured by dumped imports or not.

?/p>

We are of the view that the Article 3.1 requirement to base a determination of injury on positive evidence and pursuant to an objective examination imposes certain obligations on an investigating authority with regard to the consistency of the data collected and relied upon as the basis for its determination. In brief, examining only a part of the industry as defined by the investigating authority is not an objective examination of positive evidence since it is not representative of the overall state of the domestic industry. The use of a consistent and representative data set will best reflect the state of the domestic industry for the purposes of an injury analysis. We thus disagree with Mexico’s view that an IA may opt to limit its collection and evaluation of data in respect of certain injury factors to only a certain part of the domestic industry as defined by it for the purposes of its injury analysis.

?/p>

Thus, in respect of the economic injury factors, Economía sought information from four companies and received and analysed information from three companies constituting 88 per cent of the domestic industry. We are of the view that, under these circumstances, the use of such data might have been reflective of the state of the domestic industry in respect of those factors. However, in respect of the financial indicators, we emphasize that Economía did not even attempt to seek information from other firms constituting the domestic industry as Economía had defined it. We consider that Economía acted inconsistently with its injury analysis obligations under Article 3 in treating the partial financial data that it sought, acquired and analysed as a sufficient basis for its determination in respect of such factors, and as a component of its overall injury analysis. Among other things, there was no assessment as to how, or the extent to which, Hylsa’s financial performance was reflective of, or better or worse than, the financial state of the rest of the domestic industry, as this had been defined by Economía. Furthermore, Mexico has failed to provide any acceptable justification regarding these gaps in the information sought and received and then analysed in its injury investigation. We note that there were only four firms comprising the domestic industry as defined by Economía for the purposes of its injury analysis; in our view it would not have been impracticable for Economía to have acquired financial injury data from the remaining firms constituting the domestic industry as defined by Economía.?sup id="fntext-299">(299)

(f) Causation / Non-attribution

216.   The Panel in Mexico ?Steel Pipes and Tubes considered whether an unbiased and objective investigating authority could have treated cost trends and a decrease in exports in the manner that the Mexican investigating authority did when analysing injury and causality.⁽³⁰⁰⁾ Regarding the argument on costs, the Panel considered Guatemala had failed to make a prima facie case. On exports, the Panel did not think the investigating authority made any attempt in the Final Determination to “distinguish the relative impacts on the industry of the respective declines in the volumes of domestic sales and exports.?sup id="fntext-301">(301) As such, the Panel found the investigating authority in Mexico to have acted inconsistently with Mexico’s obligations under Articles 3.1, 3.2, 3.4 and 3.5 in its treatment of the decrease in exports in its causation analysis:⁽³⁰²⁾

“To the contrary, the only explanation given by Economía for dismissing the decline in exports as a determinative factor was exports? small share of domestic production. This statistic is irrelevant, however, given that the ‘yardstick?used in Economía entire analysis in this section of the Determination was the absolute decline in volume, by which yardstick the decline in exports over the period analysed by Economía was considerably larger than that in domestic sales. In short, we do not consider that Economía non-attribution analysis in respect of the impact of the decline in exports on the domestic industry was sufficient.?sup id="fntext-303">(303)

(g) “the effect of dumped imports?/p>

217.   In Guatemala ?Cement II, Mexico claimed that Guatemala’s investigating authority had violated Articles 3.1 and 3.2 by not considering at all, in its investigation, certain other cement imports. The Panel understood the Mexican claim to be that the Guatemalan authorities considered the type of cement under the not scrutinized imports as being “unlike?the cement under the imports subject to investigation, an assessment which Mexico considered erroneous. Mexico further claimed that the erroneous exclusion of certain imports from the investigation resulted in the following consequences: (i) the resulting volume of total imports of the product under investigation was lower; (ii) the share of allegedly dumped imports in total imports of the product under investigation was artificially inflated; (iii) the consideration of a faulty and incomplete figure for total imports of the product under investigation yielded a distorted figure for apparent domestic consumption; and (iv) because of this incorrect figure for apparent domestic consumption, the relationship between the increase in dumped imports and consumption was ultimately incorrect.⁽³⁰⁴⁾ The Panel considered that consequences (i) through (iv), if proven, would constitute a violation of Articles 3.1 and 3.2, in that an exclusion of the imports at issue from the figures for domestic consumption of the like product affected the comparison that was made with the figures for volume of dumped imports for purposes of determining that there had been a significant increase in dumped imports relative to domestic consumption in the importing Member.⁽³⁰⁵⁾ After reviewing the evidence submitted by Mexico and inconsistencies in Guatemala’s replies in this regard, the Panel ultimately found that Mexico had established a prima facie case of inconsistency with respect to Articles 3.1 and 3.2.⁽³⁰⁶⁾

(h) Relationship with other paragraphs of Article 3

218.   In Thailand ?H-Beams, the Appellate Body referred to Article 3.7 as well as Articles 5.2, 5.3, 6 and 12 in interpreting Article 3.1. See paragraph 186 above.

4. Article 3.2

(a) Choice of analytical methodology

(i) General

219.   With respect to Article 3.2, the Panel in Thailand ?H-Beams stated that “it is for the investigating authorities in the first instance to determine the analytical methodologies that will be applied in the course of an investigation, as Article 3 contains no requirements concerning the methodology to be used.?sup id="fntext-307">(307)

220.   In Egypt ?Steel Rebar, the Panel did not find on the plain text of Article 3.2 any requirement that the price undercutting analysis must be conducted at any particular level of trade. See paragraph 230 below.

(ii) Frequency of analysis

221.   The Panel in Thailand ?H-Beams considered that a quarterly analysis of the trend in import volume is not required under Article 3.2, and went on to state that “[g]iven that on an annual basis over a multi-year period, imports from Poland increased in every period examined, we do not believe that quarter-to-quarter fluctuation in import volumes during one of the twelvemonth periods examined invalidates the Thai authorities?finding that the import volume of the subject imports ‘increased continuously??sup id="fntext-308">(308)

(iii) Length of period of investigation

222.   In Guatemala ?Cement II, the Panel did not agree with Mexico’s argument that Guatemala’s authority had acted inconsistently with Article 3.2 by examining import data only for the one-year period of investigation. The Panel explained:

“A recent recommendation of the Committee on Anti-Dumping Practices calls on Members to use a data collection period of at least three years. This recommendation reflects the common practice of Members.⁽³⁰⁹⁾ That said, there is no provision in the Agreement which specifies the precise duration of the period of data collection. Thus, it cannot be said a priori that the use of a one-year period of data collection would not be consistent with the requirement of Article 3.2 to consider whether there has been a significant increase in the volume of dumped imports in the circumstances of a particular case. In this case, Guatemala argues that the reason for the short period of data collection was that exports by Cruz Azul did not become significant until 1995. The record of the investigation supports this conclusion.?sup id="fntext-310">(310)

223.   With respect to the recommendation by the Committee on Anti-Dumping Practices on this topic, see paragraph 13 above.

(b) “a significant increase in dumped imports?/p>

224.   In Thailand ?H-Beams, the Panel considered that Article 3.2 does not require that the term “significant?be used to characterize a subject increase in imports in the determination of an investigating authority. The Panel explained:

“We note that the text of Article 3.2 requires that the investigating authorities ‘consider whether there has been a significant increase in dumped imports? The Concise Oxford Dictionary defines ‘consider?as, inter alia: ‘contemplate mentally, especially in order to reach a conclusion? ‘give attention to? and ‘reckon with; take into account? We therefore do not read the textual term ‘consider?in Article 3.2 to require an explicit ‘finding? or ‘determination?by the investigating authorities as to whether the increase in dumped imports is ‘significant? While it would certainly be preferable for a Member explicitly to characterize whether any increase in imports is ‘significant? and to give a reasoned explanation of that characterization, we believe that the word ‘significant? does not necessarily need to appear in the text of the relevant document in order for the requirements of this provision to be fulfilled. Nevertheless, we consider that it must be apparent in the relevant documents in the record that the investigating authorities have given attention to and taken into account whether there has been a significant increase in dumped imports, in absolute or relative terms.?sup id="fntext-311">(311)

225.   In Guatemala ?Cement II, the Panel agreed with Mexico that Guatemala’s authority had acted inconsistently with Articles 3.1 and 3.2 by not taking into account imports other than those from the supplier under investigation. See paragraph 217 above.⁽³¹²⁾

(c) “the effect of the dumped imports on prices?/p>

226.   In Guatemala ?Cement II, disagreeing with Mexico’s claim that in violation of Article 3.2, Guatemala’s authority had not properly examined the effect of dumped imports on the price of domestic sales, the Panel stated that “[b]ased on the evidence of declining prices and inability to achieve established price levels, coinciding with imports at lower prices we find that an objective and unbiased investigating authority could have properly concluded that the dumped imports were having a negative effect on the prices of the domestic industry.?sup id="fntext-313">(313)

227.   In Guatemala ?Cement II, the Panel also rejected Mexico’s argument that Guatemala’s authority conducted the examination of the price effect of dumped imports at the regional level only and not also at the national level and therefore acted inconsistently with Article 3.2. Rather, the Panel found that Guatemala had not limited its analysis to a particular region. The Panel also added that there was only one cement producer in Guatemala, and thus, even if the negative effect of the dumped imports on the prices of the domestic like product was only evidenced in one particular region (where that producer was located), this could still be viewed as causing injury to that producer.⁽³¹⁴⁾

228.   The Panel in Korea ?Certain Paper considering the issue of assessment of price effects under Article 3.2, noted that while Article 3.2 stipulates that the investigating authority has to consider whether dumped imports have had one of the three possible effects on the prices of the domestic industry: (a) significant price undercutting, (b) significant price depression or (c) significant price suppression, “it does not, however, require that a determination be made in this regard?⁽³¹⁵⁾

229.   The Panel in Korea ?Certain Paper stated that it does not read Article 3.2 as requiring that the word “significant?appear in the text of the investigating authority’s determination, explaining that:

?a href="#article3A2">Article 3.2 does not generally require the IA to make a determination about the ‘significance?of price effects or indeed as to whether there were price effects as such. All it requires is that the IA consider whether there has been significant price undercutting, price depression or price suppression. In our view, therefore, the requirements of that article will be satisfied if the determination demonstrates that the IA properly considered whether or not prices of dumped imports had one of the three price effects set out under Article 3.2.?sup id="fntext-316">(316)

(d) “price undercutting?/p>

230.   In Egypt ?Steel Rebar, Turkey had argued that, to satisfy the requirements of Article 3.2, a price undercutting analysis must be made on a delivered-to-the customer basis, as, in its view, it is only at that level that any such undercutting can influence customers?purchasing decisions. The Panel did not find on the basis of the plain text of Article 3.2 any requirement that the price undercutting analysis must be conducted in any particular way, that is, at any particular level of trade.⁽³¹⁷⁾

231.   The Panel in EC ?Tube or Pipe Fittings similarly stated that “unlike Article 2 (in particular Article 2.4.2) of the Anti-Dumping Agreement, which contains specific requirements relating to the calculation of the dumping margin, Article 3.2 requires the investigating authorities to consider whether price undercutting is ‘significant? but does not set out any specific requirement relating to the calculation of a margin of undercutting, or provide a particular methodology to be followed in this consideration.?sup id="fntext-318">(318) The Panel reasoned as follows:

“The text of Article 3.2 refers to domestic ‘prices?(in the plural rather than singular). This textual element supports our view that there is no requirement under Article 3.2 to establish one single margin of undercutting on the basis of an examination of every transaction involving the product concerned and the like product. In addition, the text of Article 3.2 refers to the ‘dumped imports? that is, the imports of the product concerned from an exporting producer that has been determined to be dumping. Thus, investigating authorities may treat any imports from producers/ exporters for which an affirmative determination of dumping is made as ‘dumped imports?for purposes of injury analysis under Article 3. There is, however, no requirement to take each and every transaction involving the ‘dumped imports?into account, nor that the ‘dumped imports?examined under Article 3.2 are limited to those precise transactions subject to the dumping determination. This view is supported by the absence of a specific provision concerning time periods in the Agreement; an importing Member may investigate price effects of imports in an injury investigation period which may be different than the IP for dumping. These considerations do not, of course, diminish the obligation of an investigating authority to conduct an unbiased and evenhanded price undercutting analysis.

We take note of the shared view of the parties that ‘the Panel should accord a considerable discretion to the investigating authorities to choose a methodology which produces a meaningful result while avoiding unfairness? One purpose of a price undercutting analysis is to assist an investigating authority in determining whether dumped imports have, through the effects of dumping, caused material injury to a domestic industry. In this part of an anti-dumping investigation, an investigating authority is trying to discern whether the prices of dumped imports have had an impact on the domestic industry. The interaction of two variables would essentially determine the extent of impact of price undercutting on the domestic industry: the quantity of sales at undercutting prices; and the margin of undercutting of such sales. Sales at undercutting prices could have an impact on the domestic industry (for example, in terms of lost sales) irrespective of whether other sales might be made at prices above those charged by the domestic industry. The fact that certain sales may have occurred at ‘non-underselling prices?does not eradicate the effects in the importing market of sales that were made at underselling prices. Thus, a requirement that an investigating authority must base its price undercutting analysis on a methodology that offset undercutting prices with ‘overcutting? prices would have the result of requiring the investigating authority to conclude that no price undercutting existed when, in fact, there might be a considerable number of sales at undercutting prices which might have had an adverse effect on the domestic industry.?sup id="fntext-319">(319)

232.   The Panel in EC ?Salmon (Norway) considered that to reach a conclusion of significant price undercutting, where the investigating authority had found that the domestic product benefited from a price premium over imports, that price premium would have to be considered. The European Communities argued that the existence of a price premium was irrelevant to the analysis of price undercutting and could only be taken into account when considering the injury margin.⁽³²⁰⁾ The Panel found the EC argument unconvincing:

“Merely that the price premium [sic] was taken into account in calculating the injury margin does not demonstrate that it was considered and deemed irrelevant to the evaluation of price undercutting. Having identified the existence of a price premium for the domestic product over the imports, we consider that an unbiased and objective investigating authority could not conclude, without explanation, that such price premium had no bearing on the issue of whether there was significant price undercutting. Thus, the investigating authority’s finding of significant price undercutting is not consistent with the requirements of Articles 3.1 and 3.2.?sup id="fntext-321">(321)

233.   In EC ?Fasteners (China), the Panel rejected a claim that the investigating authority’s price undercutting determination was required to adjust for differences that affected price comparability. The Panel found:

“It is clear that the text of Article 3.2 provides no methodological guidance as to how an investigating authority is to ‘consider? whether there has been significant price undercutting. In our view, price undercutting may be demonstrated by comparing the prices of the like product of the domestic industry with the prices of the dumped imports, as the European Union did in this case. However, there is no equivalent requirement under Article 3.2 to that of Article 2.4 of the AD Agreement with respect to ‘due allowance?for differences affecting price comparability. In our view, while it is clear that the general requirements of objective examination and positive evidence of Article 3.1 limit an investigating authority’s discretion in the conduct of a price undercutting analysis, this does not mean that the requirements of Article 2.4 with respect to due allowance for differences affecting price comparability are applicable.?sup id="fntext-322">(322)

(e) Relationship with other paragraphs of Article 3

234.   With respect to the relationship of paragraph 2 with paragraphs 1, 3, 4 and 5 of Article 3, see paragraphs 169?a href="#170">170 above.

5. Article 3.3

(a) Relationship with other paragraphs of Article 3

235.   With respect to the relationship of paragraph 3 with paragraphs 1, 2, 4 and 5 of Article 3, see paragraph 169 above.

236.   In its report on EC ?Tube or Pipe Fittings, the Appellate Body stated that in case of a cumulated injury analysis, there is no indication in the text of Article 3.2 that the analyses of volume and prices must be performed on a country-by-country basis where an investigation involves imports from several countries.⁽³²³⁾ The Appellate Body thus confirmed the Panel’s position in this case that it is possible for the analyses of volume and prices envisaged under Article 3.2 to be done on a cumulative basis, as opposed to an individual country basis, when dumped imports originate from more than one country.⁽³²⁴⁾

(b) Conditions for cumulation ?general

237.   The Panel in EC ?Tube or Pipe Fittings came to the conclusion, on the basis of the text in Article 3.3, and citing contextual support in Articles 3.4 and 3.5, that the conditions identified in Article 3.3 are the sole conditions that must be satisfied by an investigating authority in order to undertake a cumulative assessment of the effects of dumped imports.⁽³²⁵⁾ In particular, the Panel rejected Brazil’s allegation that an investigating authority must first consider whether country-specific import volumes have significantly increased before cumulating them.⁽³²⁶⁾ The Appellate Body agreed with the Panel and reached the following conclusion:

“The text of Article 3.3 expressly identifies three conditions that must be satisfied before an investigating authority is permitted under the Anti-Dumping Agreement to assess cumulatively the effects of imports from several countries. These conditions are:

(a)   the dumping margin from each individual country must be more than de minimis;

(b)   the volume of imports from each individual country must not be negligible; and

(c)   cumulation must be appropriate in the light of the conditions of competition

(i)   between the imported products; and

(ii)   between the imported products and the like domestic product.

By the terms of Article 3.3, it is ‘only if?the above conditions are established that an investigating authority ‘may?make a cumulative assessment of the effects of dumped imports from several countries.

We find no basis in the text of Article 3.3 for Brazil’s assertion that a country-specific analysis of the potential negative effects of volumes and prices of dumped imports is a pre-condition for a cumulative assessment of the effects of all dumped imports. Article 3.3 sets out expressly the conditions that must be fulfilled before the investigating authorities may cumulatively assess the effects of dumped imports from more than one country. There is no reference to the country-by-country volume and price analyses that Brazil contends are pre-conditions to cumulation. In fact, Article 3.3 expressly requires an investigating authority to examine country-specific volumes, not in the manner suggested by Brazil, but for purposes of determining whether the ‘volume of imports from each country is not negligible??sup id="fntext-327">(327)

238.   In support of its finding, the Appellate Body in EC ?Tube or Pipe Fittings further elaborated on the rationale behind the practice of cumulation:

“The apparent rationale behind the practice of cumulation confirms our interpretation that both volume and prices qualify as ‘effects? that may be cumulatively assessed under Article 3.3. A cumulative analysis logically is premised on a recognition that the domestic industry faces the impact of the ‘dumped imports?as a whole and that it may be injured by the total impact of the dumped imports, even though those imports originate from various countries. If, for example, the dumped imports from some countries are low in volume or are declining, an exclusively country-specific analysis may not identify the causal relationship between the dumped imports from those countries and the injury suffered by the domestic industry. The outcome may then be that, because imports from such countries could not individually be identified as causing injury, the dumped imports from these countries would not be subject to anti-dumping duties, even though they are in fact causing injury. In our view, therefore, by expressly providing for cumulation in Article 3.3 of the Anti-Dumping Agreement, the negotiators appear to have recognized that a domestic industry confronted with dumped imports originating from several countries may be injured by the cumulated effects of those imports, and that those effects may not be adequately taken into account in a country-specific analysis of the injurious effects of dumped imports. Consistent with the rationale behind cumulation, we consider that changes in import volumes from individual countries, and the effect of those country-specific volumes on prices in the importing country’s market, are of little significance in determining whether injury is being caused to the domestic industry by the dumped imports as a whole.⁽³²⁸⁾?sup id="fntext-329">(329)

(c) Conditions for cumulation ?appropriate in light of the “conditions of competition?/p>

 239.   The Panel in EC ?Tube or Pipe Fittings examined the nature and scope of the requirement in Article 3.3(b) that a cumulative assessment of the effects of the imports is appropriate in light of the conditions of competition between the imported products and the conditions of competition between the imported products and the like domestic product. It considered that, “in light of the general wording of the provision and the nature of the term ‘appropriate? an investigating authority enjoys a certain degree of discretion in making that determination on the basis of the record before it. However, it is clear to us that cumulation must be suitable or fitting in the particular circumstances of a given case in light of the particular conditions of competition extant in the marketplace.?sup id="fntext-330">(330)

240.   The Panel in EC ?Tube or Pipe Fittings understood the phrase “conditions of competition?to refer to the dynamic relationship between products in the marketplace and added that this phrase is not accompanied by any sort of qualifier such as “identical?or “similar? It concluded that Article 3.3 contains no express indicators by which to assess the “conditions of competition? much less any fixed rules dictating precisely the relative percentages or levels of such indicators that must be present:

“While we note that a broadly parallel evolution and a broadly similar volume and price trend might well indicate that imports may appropriately be cumulated, we find no basis in the text of the Agreement for Brazil’s assertion that ‘only a comparable evolution and a similarity of the significantly increased import volumes and/or the significant price effects ?would indicate that these imports might have a joint impact on the situation of the domestic industry and may be assessed cumulatively? Moreover, the provision contains no express indicators by which to assess the ‘conditions of competition? much less any fixed rules dictating precisely and exhaustively the relative percentages or levels of such indicators that must be present. Unlike the lists of factors that guide an authority’s examination under, for example, Articles 3.2, 3.4 and 3.5, Article 3.3 does not provide even an indicative list of factors that might be relevant in the assessment called for under that provision, in particular, the assessment of ‘conditions of competition?⁽³³¹⁾ We note that Article 3.2 explicitly concentrates on volume and price trends, and that Article 3.3 is neither specific nor limited in this way. Thus, while price and volume considerations may well be relevant in this context, we find no explicit reference thereto in Article 3.3(b).?sup id="fntext-332">(332)

6. Article 3.4

(a) “dumped imports?/p>

241.   In EC ?Bed Linen, the Panel rejected the argument that “dumped imports? must be understood to refer only to imports which are the subject of transactions in which the export price was below normal value. See the material at paragraph 200 and following.

242.   The Panel in EC ?Salmon (Norway) noted that, if there was a finding of de minimis dumping margins it was “inescapable?that imports attributable to such producer or exporter would not be able to be treated as “dumped?imports for any aspect of that investigation.⁽³³³⁾ The Panel continued:

“In our view, it would be illogical to treat such imports as ‘dumped? imports for purposes of the injury determination, when they cannot be considered as ‘dumped?for purposes of imposition of anti-dumping duties as a result of the investigation.?sup id="fntext-334">(334)

(b) “domestic industry?/p>

 (i) Sectoral analysis

243.   The Appellate Body in US ?Hot-Rolled Steel ruled that investigating authorities can undertake “an evaluation of particular parts, sectors or segments within a domestic industry? provided they respect the fundamental obligation in Article 3.1 to conduct an “objective assessment?sup id="fntext-335">(335):

“[I]t seems to us perfectly compatible with Article 3.4 for investigating authorities to undertake, or for a Member to require its investigating authorities to undertake, an evaluation of particular parts, sectors or segments within a domestic industry.⁽³³⁶⁾ Such a sectoral analysis may be highly pertinent, from an economic perspective, in assessing the state of an industry as a whole.

However, the investigating authorities?evaluation of the relevant factors must respect the fundamental obligation, in Article 3.1, of those authorities to conduct an ‘objective examination? If an examination is to be ‘objective? the identification, investigation and evaluation of the relevant factors must be even-handed. Thus, investigating authorities are not entitled to conduct their investigation in such a way that it becomes more likely that, as a result of the fact-finding or evaluation process, they will determine that the domestic industry is injured.

Instead, Articles 3.1 and 3.4 indicate that the investigating authorities must determine, objectively, and on the basis of positive evidence, the importance to be attached to each potentially relevant factor and the weight to be attached to it. In every investigation, this determination turns on the ‘bearing?that the relevant factors have ‘on the state of the [domestic] industry??sup id="fntext-337">(337)

(ii) Domestic producers outside the “sample?/i>

“[I]t is clear that in making a determination regarding the threat of material injury, the investigating authority must conclude that ?i>material injury would occur?(emphasis added) in the absence of an anti-dumping duty or price undertaking. A determination that material injury would occur cannot, in our view, be made solely on the basis of consideration of the Article 3.7 factors. Rather, it must include consideration of the likely impact of further dumped imports on the domestic industry.

While an examination of the Article 3.7 factors is required in a threat of injury case, that analysis alone is not a sufficient basis for a determination of threat of injury, because the Article 3.7 factors do not relate to the consideration of the impact of the dumped imports on the domestic industry. The Article 3.7 factors relate specifically to the questions of the likelihood of increased imports (based on the rate of increase of imports, the capacity of exporters to increase exports, and the availability of other export markets), the effects of imports on future prices and likely future demand for imports, and inventories. They are not, in themselves, relevant to a decision concerning what the ‘consequent impact?of continued dumped imports on the domestic industry is likely to be. However, it is precisely this latter question ? whether the ‘consequent impact?of continued dumped imports is likely to be material injury to the domestic industry ?which must be answered in a threat of material injury analysis. Thus, we conclude that an analysis of the consequent impact of imports is required in a threat of material injury determination.?sup id="fntext-418">(418)

298.   Having established that an analysis of the impact of imports on the domestic industry is required also in the context of the determination of a “threat of injury? the Panel in Mexico ?Corn Syrup held that this analysis is to be performed pursuant to Article 3.4, since “[n]othing in the text or context of Article 3.4 limits consideration of the Article 3.4 factors to cases involving material injury?

“Turning to the question of the nature of the analysis required, we note that Article 3.4 of the AD Agreement sets forth factors to be evaluated in the examination of the impact of dumped imports on the domestic industry. Nothing in the text or context of Article 3.4 limits consideration of the Article 3.4 factors to cases involving material injury. To the contrary, as noted above, Article 3.1 requires that a determination of ‘injury? which includes threat of material injury, involve an examination of the impact of imports, while Article 3.4 sets forth factors relevant to that examination. Article 3.7 requires that the investigating authorities determine whether, in the absence of protective action, material injury would occur. In our view, consideration of the Article 3.4 factors in examining the consequent impact of imports is required in a case involving threat of injury in order to make a determination consistent with the requirements of Articles 3.1 and 3.7.?sup id="fntext-419">(419)

299.   The Panel in Mexico ?Corn Syrup concluded that consideration of the factors in Article 3.4 “is necessary in order to establish a background against which the investigating authority can evaluate whether imminent further dumped imports will affect the industry’s condition in such a manner that material injury would occur in the absence of protective actions, as required by Article 3.7.?sup id="fntext-420">(420) It further indicated that “[t]he text of the AD Agreement requires consideration of the Article 3.4 factors in a threat determination. Article 3.7 sets out additional factors that must be considered in a threat case, but does not eliminate the obligation to consider the impact of dumped imports on the domestic industry in accordance with the requirements of Article 3.4?⁽⁴²¹⁾

300.   The Panel in US ?Softwood Lumber VI agreed with the views expressed by the Panel in Mexico ?Corn Syrup (see paragraph 299 above), while emphasizing at the same time that there is no requirement under Article 3.7 to conduct a second Article 3.4 analysis:

“It seems clear to us that, as the Panel found in Mexico ?Corn Syrup, there must, in every case in which threat of material injury is found, be an evaluation of the condition of the industry in light of the Article 3.4/15.4 factors to establish the background against which the impact of future dumped/subsidized imports must be assessed, in addition to an assessment of specific threat factors. However, once such an analysis has been carried out, we do not read the relevant provisions of the Agreements to require an assessment of the likely impact of future imports by reference to a consideration of projections regarding each of the Article 3.4/15.4 factors. There is certainly nothing in the text of either Article 3.7 of the AD Agreement and Article 15.7 of the SCM Agreement, or Article 3.4 of the AD Agreement and Article 15.4 of the SCM Agreement, setting out an obligation to conduct a second analysis of the injury factors in cases involving threat of material injury. Of course, such an assessment could be undertaken, to the extent available information permitted, and might be useful. However, in many instances, it seems likely that the necessary information would not be available, for instance projected productivity, return on investment, projected cash flow, etc. Even if projections are made on the basis of the information gathered in the investigation, this might result in a degree of speculation in the decision-making process, which is not consistent with the requirements of the Agreements.?sup id="fntext-422">(422)

301.   The Panel in US ?Softwood Lumber VI came to a similar conclusion with respect to the absence of a requirement for a second Article 3.2 analysis:

“With respect to the factors set out in Article 3.2 of the AD Agreement and Article 15.2 of the SCM Agreement, we see even less basis for concluding that they must be directly considered in a ‘predictive? context in making a threat of material injury determination. These provisions require the investigating authorities to consider events in the past, during the period investigated, in making a determination regarding present material injury. Thus, the text directs the investigating authorities to consider whether there ‘has been?a significant increase in imports, whether there ‘has been? significant price undercutting, or whether the effect of imports is otherwise to depress prices or prevent price increases which otherwise ‘would have?occurred. As with the consideration of the Article 3.4/15.4 factors, the consideration of the Article 3.2/15.2 factors forms part of the background against which the investigating authorities can evaluate the effects of future dumped and/or subsidized imports.⁽⁴²³⁾?sup id="fntext-424">(424)

(e) Distinction between the roles of the investigating authorities and the Panel

302.   In Mexico ?Corn Syrup (Article 21.5 ?US), Mexico had requested the Appellate Body to reverse the finding of the Panel regarding the likelihood of increased imports on the grounds that the Panel had wrongly interpreted Article 3.7 of the Anti-Dumping Agreement and incorrectly applied the standard of review prescribed by Articles 17.5 and 17.6 of that Agreement. The Appellate Body drew the line between the roles of the investigating authorities and the panel in respect of Article 3.7 of the Anti-Dumping Agreement as follows:

“In previous anti-dumping cases, we have emphasized the importance of distinguishing between the different roles of panels and investigating authorities.⁽⁴²⁵⁾ We note, in this regard, that Article 3.7 of the Anti-Dumping Agreement sets forth a number of requirements that must be respected in order to reach a valid determination of a threat of material injury. The third sentence of Article 3.7 explicitly recognizes that it is the investigating authorities who make a determination of threat of material injury, and that such determination ?by the investigating authorities ?‘must be based on facts and not merely on allegation, conjecture or remote possibility? Consequently, Article 3.7 is not addressed to panels, but to the national investigating authorities which determine the existence of a threat of material injury.

The Anti-Dumping Agreement imposes a specific standard of review on panels. With respect to facts, Articles 17.5 and 17.6(i) of the Anti-Dumping Agreement, together with Article 11 of the DSU⁽⁴²⁶⁾, set out the standard to be applied by panels when assessing whether a Member’s investigating authorities have ‘established? and ‘evaluated?the facts consistently with that Member’s obligations under the covered agreements.⁽⁴²⁷⁾ These provisions do not authorize panels to engage in a new and independent fact-finding exercise. Rather, in assessing the measure, panels must consider, in the light of the claims and arguments of the parties, whether, inter alia, the ‘establishment?of the facts by the investigating authorities was ‘proper? in accordance with the obligations imposed on such investigating authorities under the Anti-Dumping Agreement.⁽⁴²⁸⁾

In our view, the ‘establishment?of facts by investigating authorities includes both affirmative findings of events that took place during the period of investigation as well as assumptions relating to such events made by those authorities in the course of their analyses. In determining the existence of a threat of material injury, the investigating authorities will necessarily have to make assumptions relating to ‘the “occurrence of future events?since such future events “can never be definitively proven by facts?⁽⁴²⁹⁾ Notwithstanding this intrinsic uncertainty, a ‘proper establishment? of facts in a determination of threat of material injury must be based on events that, although they have not yet occurred, must be ‘clearly foreseen and imminent? in accordance with Article 3.7 of the Anti-Dumping Agreement.⁽⁴³⁰⁾?sup id="fntext-431">(431)

(f) Relationship with other paragraphs of Article 3

303.   In Thailand ?H-Beams, the Appellate Body referred to Article 3.7 in interpreting Article 3.1. See paragraph 186 above.

304.   With respect to the relationship between paragraphs 4 and 7 of Article 3, see paragraphs 298?a href="#299">299 above.

10. Article 3.8

305.   The Panel in US ?Softwood Lumber VI examined the meaning of the requirement under Article 3.8 of the Anti-Dumping Agreement and Article 15.8 of the SCM Agreement to consider and decide the application of anti-dumping and countervailing duties in a threat of injury case with “special care? Based on dictionary definitions of “special?and “care? the Panel opined that “a degree of attention over and above that required of investigating authorities in all anti-dumping and countervailing duty injury cases is required in the context of cases involving threat of material injury.?sup id="fntext-432">(432)

306.   The Panel in US ?Softwood Lumber VI further considered that, in spite of the fact that Article 3.8 and Article 15.8 provide that the application of a measure has to be considered with special care, the “special care?obligation applies “during the process of investigation and determination of threat of material injury, that is, in the establishment of whether the prerequisites for application of a measure exist, and not merely afterward when final decisions whether to apply a measure are taken?⁽⁴³³⁾ Faced with the question of what is entailed by this obligation to act with an enhanced degree of attention, so as to demonstrate compliance with the “special care? obligation, the Panel made the following finding:

“The Agreements require, as noted above, an objective evaluation based on positive evidence in making any injury determination, including one based on threat of material injury. Canada has not asserted any specific legal requirements with respect to special care ? it has made no arguments as to what it considers might constitute the special care required by the Agreements in threat cases. It is not clear to us what the parameters of such ‘special care?in the context of an objective evaluation based on positive evidence would be. In these circumstances, we consider it appropriate to consider alleged violations of Articles 3.8 and 15.8 only after consideration of the alleged violations of specific provisions. While we do not consider that a violation of the special care obligation could not be demonstrated in the absence of a violation of the more specific provision of the Agreements governing injury determinations, we believe such a demonstration would require additional or independent arguments concerning the asserted violation of the special care requirement beyond the arguments in support of the specific violations.?sup id="fntext-434">(434)

11. Relationship with other Articles

(a) Articles 1, 9 and 18

307.   In Guatemala ?Cement II, the Panel found that the Guatemalan anti-dumping duty order at issue was inconsistent with Article 3, and other articles of the Agreement. The Panel then opined that Mexico’s claims under Article 1, 9, and 18 were “dependent claims, in the sense that they depend entirely on findings that Guatemala has violated other provisions of the AD Agreement.?sup id="fntext-435">(435) Consequently the Panel considered it not necessary to address these claims. See also paragraph 9 above.

(b) Article 4

308.   In Mexico ?Corn Syrup, the Panel discussed the relationship between footnote 9 to Article 3 and Article 4.1. See paragraph 176 above.

309.   In EC ?Fasteners (China), the Panel agreed that “it is only possible to undertake an objective examination pursuant to Article 3.1 if the result of the objective examination is not prejudged by the way the domestic industry is defined.?sup id="fntext-436">(436)

(c) Article 5

310.   The Panel in Mexico ?Corn Syrup touched on the relationship between Articles 3.2 and 5.2 (see paragraph 344 below) and the relationship between Articles 3.4 and 5.2 (see paragraph 344 below).

311.   In Guatemala ?Cement II, the Panel discussed the relationship between Article 3.7 and Articles 5.2 and 5.3; see paragraph 363 and following.

312.   In Thailand ?H-Beams, the Appellate Body referred to Articles 5.2 and 5.3, as well as to Articles 3.7, 6 and 12 in interpreting Article 3.1. See paragraph 186 above.

(d) Article 6

313.   In Thailand ?H-Beams, the Appellate Body referred to Article 6 as well as Articles 3.7, 5.2, 5.3 and 12 in interpreting Article 3.1. See paragraph 186 above.

(e) Article 11

314.   The Panel in US ?DRAMS discussed the relationship between Articles 3.5 and 11.2. See paragraph 751 below.

315.   Further in US ?DRAMS, the Panel discussed the relationship between footnote 9 to Article 3 and Article 11.2. See paragraph 751 below.

316.   In US ?Oil Country Tubular Goods Sunset Reviews, the Appellate Body rejected the argument that a likelihood-of-injury analysis under Article 11.3 requires an analysis of all the factors of Article 3. See below under Article 11.3.

(f) Article 12

317.   In Thailand ?H-Beams, the Appellate Body referred to Article 12 as well as Articles 3.7, 5.2, 5.3 and 6 in interpreting Article 3.1. See paragraph 186 above.

318.   The Panels in EC ?Bed Linen and Egypt ?Steel Rebar touched on the relationship between Articles 3.4 and 12.2. See paragraphs 842 below and 268 above respectively.

(g) Article 17

319.   The Appellate Body in Thailand ?H-Beams compared the obligation set forth in Article 3.1 with those in Articles 17.5 and 17.6. See paragraph 187 above.

320.   In Mexico ?Corn Syrup (Article 21.5 ?US), the Appellate Body drew a line between the roles of investigating authorities and the panels as regards Article 3.7 threat of injury analysis. In doing so, the Appellate Body referred to Articles 17.5 and 17.6(i). See paragraph 302 above.

12. Relationship with other WTO Agreements

(a) Article VI of the GATT 1994

321.   The Panel in US ?1916 Act (EC) explained its exercise of judicial economy with respect to Article 3 as follows:

“Since we found above that the 1916 Act violated Article VI:I by not providing for an injury test compatible with the terms of that Article and since Article 3 simply addresses in more detail the requirement of ‘material injury?contained in Article VI:1, we do not find it necessary to make specific findings under Article 3 and therefore exercise judicial economy, as we are entitled to do under GATT panel practice and WTO panel and Appellate Body practice.?sup id="fntext-437">(437)

322.   In Guatemala ?Cement II, the Panel found that the subject anti-dumping duty order of Guatemala was inconsistent with several articles of the Anti-Dumping Agreement, among them Article 3. The Panel then determined that Mexico’s claims under other articles of the Anti-Dumping Agreement and under Article VI of the GATT 1994 were “dependent claims, in the sense that they depend entirely on findings that Guatemala has violated other provisions of the AD Agreement.?sup id="fntext-438">(438) In light of this dependent nature of Mexico’s claim, the Panel considered it not necessary to address these claims.

(b) Agreement on Safeguards

323.   The Appellate Body in US ?Hot-Rolled Steel supported its interpretation of the non-attribution language of Article 3.5 by referring to its decisions in two safeguards Reports, US ?Wheat Gluten and US ?Lamb where it interpreted the non-attribution language in Article 4.2(b) of the Agreement on Safeguards in a similar manner. See also the Panel Report in Guatemala ?Cement II, paragraph 251 above.

V. Article 4  

A. Text of Article 4

Article 4: Definition of Domestic Industry

4.1   For the purposes of this Agreement, the term “domestic industry? shall be interpreted as referring to the domestic producers as a whole of the like products or to those of them whose collective output of the products constitutes a major proportion of the total domestic production of those products, except that:

(i)   when producers are related(11) to the exporters or importers or are themselves importers of the allegedly dumped product, the term “domestic industry?may be interpreted as referring to the rest of the producers;

(footnote original) 11 For the purpose of this paragraph, producers shall be deemed to be related to exporters or importers only if (a) one of them directly or indirectly controls the other; or (b) both of them are directly or indirectly controlled by a third person; or (c) together they directly or indirectly control a third person, provided that there are grounds for believing or suspecting that the effect of the relationship is such as to cause the producer concerned to behave differently from non-related producers. For the purpose of this paragraph, one shall be deemed to control another when the former is legally or operationally in a position to exercise restraint or direction over the latter.

(ii)   in exceptional circumstances the territory of a Member may, for the production in question, be divided into two or more competitive markets and the producers within each market may be regarded as a separate industry if (a) the producers within such market sell all or almost all of their production of the product in question in that market, and (b) the demand in that market is not to any substantial degree supplied by producers of the product in question located elsewhere in the territory. In such circumstances, injury may be found to exist even where a major portion of the total domestic industry is not injured, provided there is a concentration of dumped imports into such an isolated market and provided further that the dumped imports are causing injury to the producers of all or almost all of the production within such market.

4.2   When the domestic industry has been interpreted as referring to the producers in a certain area, i.e. a market as defined in paragraph 1(ii), anti-dumping duties shall be levied(12) only on the products in question consigned for final consumption to that area. When the constitutional law of the importing Member does not permit the levying of anti-dumping duties on such a basis, the importing Member may levy the antidumping duties without limitation only if (a) the exporters shall have been given an opportunity to cease exporting at dumped prices to the area concerned or otherwise give assurances pursuant to Article 8 and adequate assurances in this regard have not been promptly given, and (b) such duties cannot be levied only on products of specific producers which supply the area in question.

(footnote original) 12 As used in this Agreement “levy? shall mean the definitive or final legal assessment or collection of a duty or tax.

4.3   Where two or more countries have reached under the provisions of paragraph 8(a) of Article XXIV of GATT 1994 such a level of integration that they have the characteristics of a single, unified market, the industry in the entire area of integration shall be taken to be the domestic industry referred to in paragraph 1.

4.4   The provisions of paragraph 6 of Article 3 shall be applicable to this Article.

B. Interpretation and Application of Article 4

1. General

(a) Agreement on Subsidies and Countervailing Measures (SCM Agreement)

324.   As the text of Article 16 of the SCM Agreement parallels the text of Article 4 of the Anti-Dumping Agreement, see also the cases and materials on Article 16 in the Chapter on the SCM Agreement.

2. Article 4.1

(a) “domestic industry?/p>

325.   Referring to Article 4.1 and footnote 9 to Article 3, the Panel in Mexico ?Corn Syrup stated: “These two provisions inescapably require the conclusion that the domestic industry with respect to which injury is considered and determined must be the domestic industry defined in accordance with Article 4.1?⁽⁴³⁹⁾

326.   Regarding domestic industry production, see paragraphs 288?a href="#289">289 above.

(b) “domestic producers?/p>

327.   Referring to provisions which use the plural form, but are applicable in the singular case, the Panel in EC ?Bed Linen stated that ?a href="#article4A1">Article 4.1 of the AD Agreement defines the domestic industry in terms of ‘domestic producers?in the plural. Yet we consider it indisputable that a single domestic producer may constitute the domestic industry under the AD Agreement, and that the provisions concerning domestic industry under Article 4 continue to apply in such a factual situation.?sup id="fntext-440">(440)

328.   The Panel in EC ?Bed Linen examined whether, further to having defined the Community industry as a group of 35 producers and resorted to a sample of those producers, the European Communities was precluded from considering information relating to producers not within that sample, or not within the Community industry. See paragraphs 244?a href="#246">246 above.

(c) “a major proportion of the total domestic production?/p>

329.   The Panel in Argentina ?Poultry Anti-Dumping Duties considered whether or not the phrase “a major proportion?implies that the “domestic industry?refers to domestic producers whose collective output constitutes the majority, that is, more than 50 per cent, of domestic total production. The Panel considered different dictionary definitions and noted that the word “major?is also defined as “important, serious, or significant?⁽⁴⁴¹⁾ The Panel therefore found that “an interpretation that defines the domestic industry in terms of domestic producers of an important, serious or significant proportion of total domestic production is permissible.⁽⁴⁴²⁾?sup id="fntext-443">(443)

330.   The Panel in EC ?Salmon (Norway) concluded that the European Communities had erred in excluding certain enterprises from the domestic industry and thus the European Communities assessment of whether the producers it did include accounted for a “major proportion? of domestic production of the like product was based on incorrect information. To avoid conducting a de novo review the Panel exercised judicial economy on this point.

331.   The Appellate Body in EC ?Fasteners (China) found that the EU authorities violated Article 4.1 by defining a domestic industry comprising producers accounting for 27 per cent of total estimated EU production of fasteners. As described by the Appellate Body, “the Commission selected six producers as part of the sample, obtained relevant information from them, and verified the information on their premises. The Commission then used the information obtained from the sampled producers for its analysis of the ‘microeconomic?injury factors, but conducted its analysis of the ‘macroeconomic?injury factors on the basis of information obtained from all of the 45 producers included in the domestic industry definition.?sup id="fntext-444">(444) The Appellate Body found:

“‘A major proportion??should be understood as a proportion defined by reference to the total production of domestic producers as a whole. ‘A major proportion?of such total production will standardly serve as a substantial reflection of the total domestic production?.

In our view, the above interpretation is confirmed by the purpose of defining the domestic industry under the Anti-Dumping Agreement. As footnote 9 to Article 3 of the Anti-Dumping Agreement indicates, ‘the domestic industry forms the basis on which an investigating authority makes the determination of whether the dumped imports cause or threaten to cause material injury to the domestic producers. …’ a major proportion of the total domestic production? should be determined so as to ensure that the domestic industry defined on this basis is capable of providing ample data that ensure an accurate injury analysis.

?to ensure the accuracy of an injury determination, an investigating authority must not act so as to give rise to a material risk of distortion in defining the domestic industry, for example, by excluding a whole category of producers of the like product?.?sup id="fntext-445">(445)

332.   The Appellate Body summed up:

In sum, a proper interpretation of the term “a major proportion? under Article 4.1 requires that the domestic industry defined on this basis encompass producers whose collective output represents a relatively high proportion that substantially reflects the total domestic production. This ensures that the injury determination is based on wide-ranging information regarding domestic producers and is not distorted or skewed. In the special case of a fragmented industry with numerous producers, the practical constraints on an authority’s ability to obtain information may mean that what constitutes “a major proportion?may be lower than what is ordinarily permissible in a less fragmented industry. However, even in such cases, the authority bears the same obligation to ensure that the process of defining the domestic industry does not give rise to a material risk of distortion. A complainant alleging an inconsistency under the second method for defining the domestic industry bears the burden to prove its claim and to demonstrate that the domestic industry definition does not meet the standard of “a major proportion? Nonetheless, a domestic industry defined on the basis of a proportion that is low, or defined through a process that involves active exclusion of certain domestic producers, is likely to be more susceptible to a finding of inconsistency under Article 4.1 of the Anti-Dumping Agreement.⁽⁴⁴⁶⁾

333.   The Appellate Body also declined to draw on the 25 per cent threshold in Article 5.4 as context for interpreting “a major proportion?in Article 4.1, because “the 25 per cent benchmark under Article 5.4 does not address the question of how the entire universe of the domestic industry itself should be defined.?sup id="fntext-447">(447) Observing that the EC Regulation linked the “major proportion? requirement to the benchmark in Article 5.4, the Appellate Body found that “the Commission determined that a proportion as small as 27 per cent met the standard of ‘a major proportion?simply because it exceeded a benchmark that was irrelevant to the issue of the definition of the domestic industry. As a result ?the domestic industry defined in the fasteners investigation covered a low proportion of domestic production, which significantly restricted the data coverage for conducting an accurate and undistorted injury determination?sup id="fntext-448">(448) Furthermore, “[e]ven though, due to the fragmented nature of the fasteners industry, the practical constraints on obtaining information may justify the inclusion of a smaller proportion of domestic production in the domestic industry definition, the Commission’s approach in excluding those who provided relevant information but were unwilling to be part of the sample was unrelated to, and cannot be justified by, such practical constraints.?sup id="fntext-449">(449)

334.   In EC ?Fasteners (China), the Appellate Body upheld a Panel finding that the EU authorities (having invited all known producers to come forward and indicate willingness to participate within 15 days after the notice of initiation of the investigation) did not violate Article 4.1 by excluding from the definition of domestic industry those producers who did not make themselves known within the 15-day deadline. The Appellate Body observed that “[g]iven the multiple steps that must be carried out in an anti-dumping investigation and the time constraint on an investigation, an investigating authority must be allowed to set various deadlines to ensure an orderly conduct of the investigation.?sup id="fntext-450">(450)

335.   The Panel in EC ?Fasteners (China) rejected a claim regarding inclusion of importers, or parties related to exporters or importers of the allegedly dumped product. The Panel found that “the use of the term ‘may?in Article 4.1 makes it clear that investigating authorities are not required to exclude related producers or importing producers?and that “there is nothing in Article 3.1, or in Article 4.1, that limits the discretion of investigating authorities to exclude, or not, related or importing domestic producers.?⁽⁴⁵¹⁾

3. Relationship with other Articles

336.   In Mexico ?Corn Syrup, the Panel referred to footnote 9 to Article 3 in interpreting Article 4.1. See paragraph 325 above.

337.   The Panel in Argentina ?Poultry Anti-Dumping Duties rejected the argument that Article 4.1 does not contain an obligation, but is merely a definition which, as such, cannot be violated. The Panel considered that:

?a href="#article4A1">Article 4.1 provides that the term ‘domestic industry?‘shall? be interpreted in a specific manner. In our view, this imposes an express obligation on Members to interpret the term ‘domestic industry? in that specified manner. Thus, if a Member were to interpret the term differently in the context of an anti-dumping investigation, that Member would violate the obligation set forth in Article 4.1.?sup id="fntext-452">(452)

VI. Article 5  

A. Text of Article 5

Article 5: Initiation and Subsequent Investigation

5.1   Except as provided for in paragraph 6, an investigation to determine the existence, degree and effect of any alleged dumping shall be initiated upon a written application by or on behalf of the domestic industry.

5.2   An application under paragraph 1 shall include evidence of (a) dumping, (b) injury within the meaning of Article VI of GATT 1994 as interpreted by this Agreement and (c) a causal link between the dumped imports and the alleged injury. Simple assertion, unsubstantiated by relevant evidence, cannot be considered sufficient to meet the requirements of this paragraph. The application shall contain such information as is reasonably available to the applicant on the following:

(i)   the identity of the applicant and a description of the volume and value of the domestic production of the like product by the applicant. Where a written application is made on behalf of the domestic industry, the application shall identify the industry on behalf of which the application is made by a list of all known domestic producers of the like product (or associations of domestic producers of the like product) and, to the extent possible, a description of the volume and value of domestic production of the like product accounted for by such producers;

(ii)   a complete description of the allegedly dumped product, the names of the country or countries of origin or export in question, the identity of each known exporter or foreign producer and a list of known persons importing the product in question;

(iii)   information on prices at which the product in question is sold when destined for consumption in the domestic markets of the country or countries of origin or export (or, where appropriate, information on the prices at which the product is sold from the country or countries of origin or export to a third country or countries, or on the constructed value of the product) and information on export prices or, where appropriate, on the prices at which the product is first resold to an independent buyer in the territory of the importing Member;

(iv)   information on the evolution of the volume of the allegedly dumped imports, the effect of these imports on prices of the like product in the domestic market and the consequent impact of the imports on the domestic industry, as demonstrated by relevant factors and indices having a bearing on the state of the domestic industry, such as those listed in paragraphs 2 and 4 of Article 3.

5.3   The authorities shall examine the accuracy and adequacy of the evidence provided in the application to determine whether there is sufficient evidence to justify the initiation of an investigation.

5.4   An investigation shall not be initiated pursuant to paragraph 1 unless the authorities have determined, on the basis of an examination of the degree of support for, or opposition to, the application expressed(13) by domestic producers of the like product, that the application has been made by or on behalf of the domestic industry.(14) The application shall be considered to have been made “by or on behalf of the domestic industry?if it is supported by those domestic producers whose collective output constitutes more than 50 per cent of the total production of the like product produced by that portion of the domestic industry expressing either support for or opposition to the application. However, no investigation shall be initiated when domestic producers expressly supporting the application account for less than 25 per cent of total production of the like product produced by the domestic industry.

(footnote original) 13 In the case of fragmented industries involving an exceptionally large number of producers, authorities may determine support and opposition by using statistically valid sampling techniques.

(footnote original) 14 Members are aware that in the territory of certain Members employees of domestic producers of the like product or representatives of those employees may make or support an application for an investigation under paragraph 1.

5.5   The authorities shall avoid, unless a decision has been made to initiate an investigation, any publicizing of the application for the initiation of an investigation. However, after receipt of a properly documented application and before proceeding to initiate an investigation, the authorities shall notify the government of the exporting Member concerned.

5.6   If, in special circumstances, the authorities concerned decide to initiate an investigation without having received a written application by or on behalf of a domestic industry for the initiation of such investigation, they shall proceed only if they have sufficient evidence of dumping, injury and a causal link, as described in paragraph 2, to justify the initiation of an investigation.

5.7   The evidence of both dumping and injury shall be considered simultaneously (a) in the decision whether or not to initiate an investigation, and (b) thereafter, during the course of the investigation, starting on a date not later than the earliest date on which in accordance with the provisions of this Agreement provisional measures may be applied.

5.8   An application under paragraph 1 shall be rejected and an investigation shall be terminated promptly as soon as the authorities concerned are satisfied that there is not sufficient evidence of either dumping or of injury to justify proceeding with the case. There shall be immediate termination in cases where the authorities determine that the margin of dumping is de minimis, or that the volume of dumped imports, actual or potential, or the injury, is negligible. The margin of dumping shall be considered to be de minimis if this margin is less than 2 per cent, expressed as a percentage of the export price. The volume of dumped imports shall normally be regarded as negligible if the volume of dumped imports from a particular country is found to account for less than 3 per cent of imports of the like product in the importing Member, unless countries which individually account for less than 3 per cent of the imports of the like product in the importing Member collectively account for more than 7 per cent of imports of the like product in the importing Member.

5.9   An anti-dumping proceeding shall not hinder the procedures of customs clearance.

5.10   Investigations shall, except in special circumstances, be concluded within one year, and in no case more than 18 months, after their initiation.

B. Interpretation and Application of Article 5

1. General

(a) The Doha mandate

338.   Paragraph 7.1 of the Doha Ministerial Decision of 14 November 2001 on Implementation-Related Issues and Concerns provides that the Ministerial Conference “agrees that investigating authorities shall examine with special care any application for the initiation of an anti-dumping investigation where an investigation of the same product from the same Member resulted in a negative finding within the 365 days prior to the filing of the application and that, unless this pre-initiation examination indicates that circumstances have changed, the investigation shall not proceed.?sup id="fntext-453">(453)

(b) Agreement on Subsidies and Countervailing Measures (SCM Agreement)

339.   To the extent that the text of Article 11 of the SCM Agreement parallels the text of Article 5 of the Anti-Dumping Agreement, see also the cases and materials on Article 11 in the Chapter on the SCM Agreement.

2. Article 5.2

(a) General

340.   In Guatemala ?Cement II, the Panel examined Mexico’s claim that Guatemala’s authority, in violation of Article 5.2, had initiated the anti-dumping investigation without sufficient evidence of dumping having been included in the application. The Panel interpreted Article 5.2 with reference to Article 2, which outlines the elements that describe the existence of dumping. The Panel stated that “evidence on the ?elements necessary for the imposition of an anti-dumping measure may be inferred into Article 5.3 by way of Article 5.2.?sup id="fntext-454">(454) See paragraph 356 below. The Panel agreed that “statements of conclusion unsubstantiated by facts do not constitute evidence of the type required by Article 5.2.?sup id="fntext-455">(455)

341.   The Panel in US ?Lumber V considered that an application need only include such reasonably available information on the relevant matters as the applicant deems necessary to substantiate its allegations of dumping, injury and causality, and not all information available to the applicant:

“We note that the words ‘such information as is reasonably available to the applicant? indicate that, if information on certain of the matters listed in sub-paragraphs (i) to (iv) is not reasonably available to the applicant in any given case, then the applicant is not obligated to include it in the application. It seems to us that the ‘reasonably available?language was intended to avoid putting an undue burden on the applicant to submit information which is not reasonably available to it. It is not, in our view, intended to require an applicant to submit all information that is reasonably available to it. Looking at the purpose of the application, we are of the view that an application need only include such reasonably available information on the relevant matters as the applicant deems necessary to substantiate its allegations of dumping, injury and causality. As the purpose of the application is to provide an evidentiary basis for the initiation of the investigative process, it would seem to us unnecessary to require an applicant to submit all information reasonably available to it to substantiate its allegations.⁽⁴⁵⁶⁾ This is particularly true where such information might be redundant or less reliable than, information contained in the application.?sup id="fntext-457">(457)

(b) “evidence of ?dumping?/p>

342.   In Guatemala ?Cement II, the Panel addressed the issue of whether the elements of “dumping?require sufficient evidence under Article 5.3, basing its analysis upon the term “dumping?in Article 2. See at paragraph 356.

(c) “evidence of ? injury?/p>

343.   The evidence of threat of injury necessary in an application under Article 5.2, and the closely related issue of the amount of evidence necessary under Article 5.3 to justify the initiation of an investigation, are addressed in the Panel Report in Guatemala ?Cement II; see paragraphs 363?a href="#364">364 below.

(d) “evidence of ? causal link??subparagraph (iv)

344.   In considering what information regarding the existence of a causal link must be provided in an application pursuant to Article 5.2, the Panel in Mexico ?Corn Syrup found that “the quantity and quality of the information provided by the applicant need not be such as would be required in order to make a preliminary or final determination of injury?

“[T]he inclusion in Article 5.2(iv) of the word ‘relevant?and the phrase ‘such as?in the reference to the factors and indices in Articles 3.2 and 3.4 in our view makes it clear that an application is not required to contain information on all the factors and indices set forth in Articles 3.2 and 3.4. Rather, Article 5.2(iv) requires that the application contain information on factors and indices relating to the impact of imports on the domestic industry, and refers to Articles 3.2 and 3.4 as illustrative of factors which may be relevant. Which factors and indices are relevant to demonstrate the consequent impact of imports on the domestic industry will vary depending on the nature of the allegations made by the industry, and the nature of the industry itself. If the industry provides information reasonably available to it concerning factors which are relevant to the allegation of injury (or threat of injury) it makes in the application, and the information concerning those factors demonstrates, that is, ‘shows evidence of? the consequent impact of dumped imports on the domestic industry, we believe that Article 5.2(iv) is satisfied.

Obviously, the quantity and quality of the information provided by the applicant need not be such as would be required in order to make a preliminary or final determination of injury. Moreover, the applicant need only provide such information as is ‘reasonably available?to it with respect to the relevant factors. Since information regarding the factors and indices set out in Article 3.4 concerns the state of the domestic industry and its operations, such information would generally be available to applicants. Nevertheless, we note that an application which is consistent with the requirements of Article 5.2 will not necessarily contain sufficient evidence to justify initiation under Article 5.3.?sup id="fntext-458">(458)

345.   In Mexico ?Corn Syrup, the Panel distinguished, for the purposes of Article 5.2, between information and analysis:

?a href="#article5A2">Article 5.2 does not require an application to contain analysis, but rather to contain information, in the sense of evidence, in support of allegations. While we recognize that some analysis linking the information and the allegations would be helpful in assessing the merits of an application, we cannot read the text of Article 5.2 as requiring such an analysis in the application itself.⁽⁴⁵⁹⁾?sup id="fntext-460">(460)

346.   In Thailand ?H-Beams, the Panel, agreeing with the Panel in Mexico ?Corn Syrup⁽⁴⁶¹⁾, rejected Poland’s argument that paragraph (iv) of Article 5.2 implies that some sort of analysis of data is required in the application, and stated that “we do not read this provision as imposing any additional requirement that the application contain analysis of the data submitted in support of the application.?sup id="fntext-462">(462) The Appellate Body did not review these findings.

(e) “simple assertion, unsubstantiated by relevant evidence?/p>

347.   In Thailand ?H-Beams, the Panel stated that “raw numerical data would constitute ‘relevant evidence?rather than merely a ‘simple assertion?within the meaning of this provision.?sup id="fntext-463">(463)

(f) Relationship with other paragraphs of Article 5

348.   The Panel in Guatemala ?Cement II discussed the relationship between Articles 5.2 and 5.3 in order to clarify the requirements under both Articles 5.2 and 5.3. See paragraph 356 below. In Guatemala ?Cement II, the Panel stated that “[i]n light of our finding that the Ministry’s determination that it had sufficient evidence to justify the initiation of an investigation was inconsistent with Article 5.3, we do not consider it necessary to rule on Mexico’s Article 5.2 claims regarding the sufficiency of Cementos Progreso’s application.?sup id="fntext-464">(464)

3. Article 5.3

(a) “sufficient evidence to justify the initiation of an investigation?/p>

(i) Distinction from the requirements under Article 5.2

349.   In Guatemala ?Cement II, in examining the claim that Guatemala’s investigating authority based its initiation decision on insufficient evidence in violation of Article 5.3, the Panel commented that the fact that an application satisfied Article 5.2 does not demonstrate that there was sufficient evidence to justify initiation under Article 5.3:

?a href="#article5A2">Article 5.2 requires that the application contain sufficient evidence on dumping, injury and causation, while Article 5.3 requires the investigating authority to satisfy itself as to the accuracy and adequacy of the evidence to determine that it is sufficient to justify initiation.?sup id="fntext-465">(465)

350.   The Panel in Guatemala ?Cement II held that the appropriate legal standard under Article 5.3 was not the adequacy and accuracy per se of the evidence in the application, but the sufficiency of the evidence:

“[I]n accordance with our standard of review, we must determine whether an objective and unbiased investigating authority, looking at the facts before it, could properly have determined that there was sufficient evidence to justify the initiation of an anti-dumping investigation. Article 5.3 requires the authority to examine, in making this determination, the accuracy and adequacy of the evidence in the application. Clearly, the accuracy and adequacy of the evidence is relevant to the investigating authorities?determination whether there is sufficient evidence to justify the initiation of an investigation. It is however the sufficiency of the evidence, and not its adequacy and accuracy per se, which represents the legal standard to be applied in the case of a determination whether to initiate an investigation.?sup id="fntext-466">(466)

351.   In Guatemala ?Cement II, on the basis of the distinction between Articles 5.2 and 5.3 described in the excerpt in paragraph 356 below, the Panel stated that “[o]ne of the consequences of this difference in obligations is that investigating authorities need not content themselves with the information provided in the application but may gather information on their own in order to meet the standard of sufficient evidence for initiation in Article 5.3.?sup id="fntext-467">(467) In support of this proposition, the Panel cited the panel’s finding in Guatemala ?Cement I.⁽⁴⁶⁸⁾

(ii) Sufficiency of evidence to initiate

352.   The Panel in Mexico ?Steel Pipes and Tubes rejected Mexico’s argument that where the evidence in the application is sufficient to initiate an investigation, the mere fact that an investigating authority initiated the investigation indicates that it examined the evidence in the application and determined that it was sufficient to justify initiation for the purposes of Article 5.3. Mexico cited EC ?Bed Linen as support for its argument. The Panel did not agree that EC ?Bed Linen supported Mexico’s contention and therefore did not agree that Article 5.3 did not impose a substantive obligation upon an investigating authority to assess the sufficiency of the evidence before it:

“Although the EC ?Bed Linen panel found that Article 5.3 does not address the nature of the examination to be carried out, and does not require the investigating authority to explain how it performed its examination, we do not read that case as standing for the proposition implied by Mexico, namely that Article 5.3 imposes no substantive obligation upon an investigating authority in respect of its assessment of the sufficiency of the evidence before it. Thus, in our view, the findings of the EC ?Bed Linen panel are not germane to the substantive issue before us, which concerns Economía’s assessment of the sufficiency of the evidence before it at the time of initiation.?sup id="fntext-469">(469)

353.   The Panel in Mexico ?Steel Pipes and Tubes thought Article 5.3, read in light of Article 5.2, made it clear that there needed to be sufficient evidence in the application on dumping, injury and causation in order to justify initiating an investigation:

“Although there is no express reference to evidence of ‘dumping? or ‘injury?or ‘causation?in Article 5.3, evidence on the three elements necessary for the imposition of an anti-dumping measure may be inferred into Article 5.3 by way of Article 5.2. In particular, Article 5.2 requires that the application contain evidence on dumping, injury and causation, and Article 5.3 requires the investigating authority to satisfy itself as to the accuracy and adequacy of ‘the evidence provided in the application?to determine that that evidence is sufficient to justify initiation. Thus, reading Article 5.3 in the context of Article 5.2 makes clear that the evidence to which Article 5.3 refers is the evidence in the application concerning dumping, injury and causation …”⁽⁴⁷⁰⁾

354.   The Panel in Mexico ?Steel Pipes and Tubes did caution however that it was “not necessary for an investigating authority to have irrefutable proof of dumping or injury prior to initiating an anti-dumping investigation.?sup id="fntext-471">(471) The Panel went on to talk about its view of “sufficiency of evidence?in the context of Article 5.3:

“While the absolute threshold of sufficiency will depend upon the circumstances of a given case, Article 5.3 makes clear that the determination of sufficiency must be based on an assessment of the ‘accuracy? and ‘adequacy?of the information. In this context, we are mindful that a piece of evidence that on its own might appear to be of little or no probative value could, when placed beside other evidence of the same nature, form part of a body of evidence that, in totality, was ‘sufficient??sup id="fntext-472">(472)

355.   See also under Article 5.2.

(iii) Sufficient evidence of dumping

356.   In Guatemala ?Cement II, in examining the issue of whether Articles 2.1 and 2.4 are applicable to the decision to initiate an investigation, i.e. which specific elements of dumping need to be supported by sufficient evidence under Article 5.3, the Panel first held that what constitutes necessary evidence for the purposes of Article 5.3 can be inferred from Article 5.2. The Panel then found that “in order to determine that there is sufficient evidence of dumping, the investigating authority cannot entirely disregard the elements that configure the existence of this practice as outlined in Article 2?

“[W]e first observe that, although there is no express reference to evidence of dumping in Article 5.3, evidence on the three elements necessary for the imposition of an anti-dumping measure may be inferred into Article 5.3 by way of Article 5.2. In other words, Article 5.2 requires that the application contain sufficient evidence on dumping, injury and causation, while Article 5.3 requires the investigating authority to satisfy itself as to the accuracy and adequacy of the evidence to determine that it is sufficient to justify initiation. Thus, reading Article 5.3 in the context of Article 5.2, the evidence mentioned in Article 5.3 must be evidence of dumping, injury and causation. We further observe that the only clarification of the term ‘dumping?in the AD Agreement is that contained in Article 2. In consequence, in order to determine that there is sufficient evidence of dumping, the investigating authority cannot entirely disregard the elements that configure the existence of this practice as outlined in Article 2. This analysis is done not with a view to making a determination that Article 2 has been violated through the initiation of an investigation, but rather to provide guidance in our review of the Ministry’s determination that there was sufficient evidence of dumping to warrant an investigation. We do not of course mean to suggest that an investigating authority must have before it at the time it initiates an investigation evidence of dumping within the meaning of Article 2 of the quantity and quality that would be necessary to support a preliminary or final determination. An antidumping investigation is a process where certainty on the existence of all the elements necessary in order to adopt a measure is reached gradually as the investigation moves forward. However, the evidence must be such that an unbiased and objective investigating authority could determine that there was sufficient evidence of dumping within the meaning of Article 2 to justify initiation of an investigation.

We note that Article 2.1 states that a product is to be considered as dumped ‘if the export price ?is less than the comparable price, in the ordinary course of trade, for the like product when destined for consumption in the exporting country.?(emphasis added). Other provisions of Article 2 that further elaborate on this basic definition include Article 2.4, which sets forth certain principles regarding the comparability of export prices and normal value. In particular, Article 2.4 specifies that comparisons between the export price and the normal value shall be made at the same level of trade, and that due allowance shall be made in each case, on its merits, for differences which affect price comparability, including differences in level of trade and quantity. Consistent with our discussion above, we consider that, although these provisions of Article 2 do not ‘apply? as such to initiation determinations, they are certainly relevant to an investigating authority’s consideration as to whether sufficient evidence of dumping exists to justify the initiation of an investigation.⁽⁴⁷³⁾?sup id="fntext-474">(474)

357.   The Panel in Argentina ?Poultry Anti-Dumping Duties rejected Brazil’s claim that an investigation cannot be initiated based on an application including only normal value data related to sales in one city and expressed the view that “it is sufficient for an investigating authority to base its decision to initiate on evidence concerning domestic sales in a major market of the exporting country subject to the investigation, without necessarily having data for sales throughout that country?⁽⁴⁷⁵⁾

358.   The Panel in Argentina ?Poultry Anti-Dumping Duties also examined the compatibility with Article 5.3, read in light of Article 2.4.2, of an initiation based on a weighted average export price that was calculated using only those transactions with a price lower than the normal value. As the weighted average export price was therefore not based on the totality of comparable export transactions, the Panel considered that “the use of such a practice would not allow an objective and impartial investigating authority to properly conclude that there was sufficient evidence of dumping to justify the initiation of an investigation?⁽⁴⁷⁶⁾ The Panel thus also rejected the argument that, in order to initiate, an investigating authority need only satisfy itself that there has been some dumping, in the sense that certain transactions were dumped:

“We recall that, ‘in order to determine whether or not there is sufficient evidence of dumping for the purpose of initiation, an investigating authority cannot entirely disregard the elements that configure the existence of [dumping] outlined in Article 2?⁽⁴⁷⁷⁾ A determination of dumping should be made in respect of the product as a whole, for a given period, and not for individual transactions concerning that product. An investigating authority therefore cannot disregard export transactions at the time of initiation simply because they are equal to or greater than normal value. Disregarding such transactions does not provide a proper basis for determining whether or not there is sufficient evidence of dumping to justify initiation.?sup id="fntext-478">(478)

359.   On the question of whether a comparison between normal value for one day and export price for a period of several months constitutes a proper basis for determining whether there is sufficient evidence of dumping to justify the initiation of the investigation, the Panel in Argentina ?Poultry Anti-Dumping Duties recalled that Article 2.4 requires that a fair comparison be undertaken between the export price and the normal value in respect of sales “made at as nearly as possible the same time? It concluded that “there should be a substantial degree of overlap in the periods considered in order for the comparison of normal value and export price to be fair within the meaning of Article 2.4?⁽⁴⁷⁹⁾ For a product in respect of which there are many transactions taking place on a daily basis, it was “not persuaded that domestic sales data for one day provides sufficient overlap with export price data for several months for the purpose of Article 5.3.?sup id="fntext-480">(480)

360.   The Panel in Mexico ?Steel Pipes and Tubes considered Guatemala’s complaint regarding the sufficiency of evidence of alleged dumping pertaining to normal value. Guatemala did not raise any complaint concerning the evidence on export prices. Guatemala argued that because of the deficiencies in the normal value evidence, that evidence could not be compared on a “fair?basis with the export price evidence.⁽⁴⁸¹⁾ In considering the evidence relating to normal value the Panel, in looking at the evidence on normal value as a whole, identified a number of inter-related concerns in respect of “the sufficiency of the nexus with producer/exporter pricing in the Guatemalan home market for the product under investigation; the isolated nature of the information in terms of temporal coverage, volume, and product coverage; and, as a result, the comparability of this evidence with that on export pricing.?sup id="fntext-482">(482) One of the main concerns was that none of the normal value evidence pertained to Tubac, “the only identified exporter, which accounted for almost all production and exports of the investigated product.?sup id="fntext-483">(483) The Panel went on to say:

“We do not here mean to imply that, at the stage of initiation, an investigating authority must have pricing documentation from every domestic producer or exporter, or even any domestic producer or exporter? Nevertheless, dumping is a company-specific practice, and this is reflected in the Agreement’s provisions concerning the determination of dumping in respect of particular producers or exporters ?Where, as is the case here, it is obvious on its face that the normal value evidence before the authority at the time of initiation does not pertain to a producer or exporter and indeed pertains to a different level of trade, and may not even reflect products produced in the exporting country, the authority should make its best endeavours to verify that that evidence reflects the prevailing home market pricing at the level of producers and/or exporters.?sup id="fntext-484">(484)

361.   The Panel in Mexico ?Steel Pipes and Tubes considered the temporal, volume and product coverage of the evidence to be extremely limited and isolated and had similar concerns regarding the evidence concerning product volume and coverage:

“There is no dispute that the dates of the invoice and the price quote were both within the period of investigation, but the fact that the home market pricing evidence for each broad product sub-group (i.e., galvanized and black pipe) pertained only to a single day out of the six-month-long period of investigation raises substantial questions as to whether that evidence was representative of pricing during that period as a whole. Mexico does not argue, and there is no evidence, that Economía sought confirmation from Hylsa that, or made any other effort to determine whether, this evidence was representative of the period as a whole. In fact, Mexico confirmed to us the contrary, stating that ‘since the information submitted by the applicant was dated within the period of investigation, [Economía] did not require additional normal value information? Mexico appears to be arguing, in other words, that so long as a piece of evidence is dated within the period of investigation, even if it represents only a single day during that period, this information is ?by definition, and without more ?sufficiently representative of the period of investigation as a whole for purposes of initiation. We disagree since it is indeed quite possible that an individual, isolated transaction may be an aberration from the typical prevailing prices and/or conditions, and therefore if the applicant has provided only such temporally isolated evidence, the authority should not assume without some corroboration that this evidence is representative of the period as a whole.

?/p>

We asked Mexico: ‘Is there any indication in the Initiation Determination or in the record that Economía assessed whether the pipes in the invoice and the price quote might be considered to be sufficiently representative of the product at issue??Mexico responded that Economía had analysed the invoice and the price quote and found that ‘the prices given in both sources correspond to the investigated merchandise, are for the Guatemalan market, and were in effect during the period of investigation? We view this as an argument by Mexico that so long as a piece of evidence pertains to some part (no matter how restricted) of the product range covered by an application, that evidence ?by definition and without more ?is sufficiently representative of that product range for purposes of initiation. Again, we cannot agree with such a proposition. Where the evidence pertains to only a thin sliver of a broad overall product range, the authority should not assume without some corroboration that this evidence represents pricing for the full product range.?sup id="fntext-485">(485)

362.   However, the Panel in Mexico ?Steel Pipes and Tubes cautioned against the view that a price quote was inherently invalid because it did not represent a completed transaction and because the quoted prices were subject to change. The concerns expressed by the Panel were to do with the particular price quote in this case and not the probative value of price quotes as such. “Indeed, in another case there could well be a situation where adequately corroborated and representative price quotes constituted sufficient evidence of alleged dumping.?sup id="fntext-486">(486) Overall, in light of the evidence, the Panel concluded that “an unbiased and objective investigating authority could not have concluded there was sufficient evidence of dumping to justify the initiation of an antidumping investigation under Article 5.3.?sup id="fntext-487">(487)

(iv) Sufficient evidence of injury

363.   In Guatemala ?Cement II, the Panel examined Mexico’s argument that the Guatemalan authority did not have sufficient evidence of threat of material injury to justify the initiation of an investigation. In rebuttal, Guatemala argued that Article 3.7 does not apply to the determination of the investigating authorities on this issue, because Article 5.2(iv), which requires that an application contain certain information, does not refer to Article 3.7, but only to Articles 3.2 and 3.4. The Panel responded:

“[W]hen considering whether there is sufficient evidence of threat of injury to justify the initiation of an investigation, an investigating authority cannot totally disregard the elements that configure the existence of threat of injury outlined in Article 3. We do not mean to suggest that an investigating authority must have before it at the time it initiates an investigation evidence of threat of material injury within the meaning of Article 3 of the quantity and quality that would be necessary to support a preliminary or final determination of threat of injury. However, the investigating authority must have before it evidence of threat of material injury, as defined in Article 3, sufficient to justify the initiation of an investigation.?sup id="fntext-488">(488)

364.   However, with respect to Article 3.7, the Panel added a caveat to its finding quoted under paragraph 363 above, in stating that the investigating authority need not have before it information on all Article 3.7 factors where there is an allegation of threat of injury:

?a href="#article3A7">Article 3.7 provides specific guidance on the factors to be considered by an investigating authority when making a determination of threat of injury. Although we do not necessarily believe that an investigating authority must have before it information on all Article 3.7 factors in a case where initiation of an investigation is requested on the basis of an alleged threat of injury, a consideration of those factors is certainly pertinent to an evaluation of whether there was sufficient evidence of threat of material injury to justify the initiation of an investigation.?sup id="fntext-489">(489)

365.   The Panel in Mexico ?Steel Pipes and Tubes considered that Article 3 provided pertinent guidance for an investigating authority, before taking a decision to initiate an investigation, to satisfy itself as to the sufficiency of the evidence regarding injury. The Panel elaborated:

“While, again, we do not mean to suggest that an investigating authority must have before it, at the time it initiates an investigation, injury-related evidence of the quantity and quality that would be necessary to support a preliminary or final determination of injury, it is clear that the authority must have before it the same type of evidence of injury as defined in Article 3, including as to the volume of allegedly dumped imports, sufficient to justify the initiation of an investigation.?sup id="fntext-490">(490)

366.   The Panel in Mexico ?Steel Pipes and Tubes found that the investigating authority in Mexico had failed to properly determine that there was sufficient evidence of injury to justify the initiation of an anti-dumping investigation:

“We disagree with Mexico’s argument that requiring, at the initiation stage, some corroboration of the import volume at the tariff line level that related to the product under investigation is tantamount to imposing a requirement that initiation evidence be of the same quality and quantity as evidence required to sustain a preliminary or final determination. Again, it is the type of evidence of injury which is our focus here.

?/p>

in the circumstances of this case, we consider that an unbiased and objective investigating authority, in relying on the evidence in question, i.e., the official statistics of total imports under the two tariff lines concerned, as evidence of the volume of dumped imports ?without cross-checking (even in an approximate manner) the proportion of those tariff line import data that corresponded to the product under investigation ?could not properly have determined that there was sufficient evidence of injury to justify the initiation of an anti-dumping investigation in relation to the product under investigation. The fact that, during the course of the investigation, it was ultimately confirmed that the investigated product (however this was eventually defined) appeared to account for a substantial portion of the imports under the two tariff lines is not relevant to our examination under Article 5.3. What is relevant is what facts were known to the investigating authority at the time that it initiated the investigation. We see no basis on the record for Economía to have concluded that the total volumes at the tariff line level constituted a reasonable proxy for the volume of the allegedly dumped products during the period of investigation. We therefore find that Economía did not act consistently with Mexico’s obligations under Article 5.3 in performing its assessment of the sufficiency of the evidence of injury.?sup id="fntext-491">(491)

(v) Standard of review ?relationship with Article 17.6

367.   In determining what constitutes “sufficient evidence to justify the initiation of an investigation?under Article 5.3, the Panel in Guatemala ?Cement I applied the standard of review set out in Article 17.6(i) ⁽⁴⁹²⁾, referring, in so doing, to the GATT Panel Report in US ?Softwood Lumber II.⁽⁴⁹³⁾ The Panel also agreed with the view expressed by the Panel in US ?Softwood Lumber II that “the quantum and quality of the evidence required at the time of initiation is less than that required for a preliminary, or final, determination of dumping, injury, and causation, made after the investigation?⁽⁴⁹⁴⁾

368.   Referring to the approach of the Panel in Guatemala ?Cement I⁽⁴⁹⁵⁾, which took into account the reasoning of the GATT Panel in US ?Softwood Lumber II, the Panel in Mexico ? Corn Syrup stated that “[o]ur approach in this dispute will similarly be to examine whether the evidence before [the investigating authority] at the time it initiated the investigation was such that an unbiased and objective investigating authority evaluating that evidence, could properly have determined that sufficient evidence of dumping, injury, and causal link existed to justify initiation.?sup id="fntext-496">(496)

369.   In Guatemala ?Cement II, the Panel found that “[i]t is clear on the face of these documents that the invoices reflecting prices in Mexico are for sales occurring at the very end of the commercialization chain and the import certificates reflect prices at the point of importation which is the beginning of the commercialization chain for Mexican cement in Guatemala?⁽⁴⁹⁷⁾ The Panel subsequently found, applying the standard of review set forth in Article 17.6(i):

“[T]he fact that the sales in the Mexican and Guatemalan markets were at different levels of trade was apparent from the application itself, and an unbiased and objective investigating authority should have recognized this fact without the need for it to be pointed out. Nor do we consider that an investigating authority can completely ignore obvious differences that could affect the comparability of the prices cited in an application on the ground that the foreign exporter has not demonstrated that they have affected price comparability. Moreover, at the point where the investigating authority is considering whether there is sufficient evidence to initiate an investigation, potentially affected exporters have not even been notified of the existence of an application, much less been provided a copy thereof. Thus, the logical implication of Guatemala’s argument is that an investigating authority need never take into account issues of price comparability when considering whether there is sufficient evidence of dumping to initiate an investigation. We cannot agree with such an interpretation of the AD Agreement, particularly in light of the criteria set out in para. 8.36 above.

After a thorough review of all the actions by the Ministry leading up to the initiation of the investigation, we find that no attempt was made to take into account glaring differences in the levels of trade and sales quantities and their possible effects on price comparability. Under these circumstances, an unbiased and objective investigating authority could not in our view have concluded that there was sufficient evidence of dumping to justify the initiation of an anti-dumping investigation.?sup id="fntext-498">(498)

370.   Having found that the Guatemalan investigating authority should have considered the issue of price comparability when considering whether there was sufficient evidence of dumping to initiate an investigation, the Panel emphasized that it did not expect:

“[I]nvestigating authorities at the initiation phase to ferret out all possible differences that might affect the comparability of prices in an application and perform or request complex adjustments to them. We do however expect that, when from the face of an application it is obvious that there are substantial questions of comparability between the export and home market prices being compared, the investigating authority will at least acknowledge that differences in the prices generate questions with regards to their comparability, and either give some consideration as to the impact of those differences on the sufficiency of the evidence of dumping or seek such further information as might be necessary to do so.?sup id="fntext-499">(499)

(b) “shall examine the accuracy and adequacy of the evidence provided in the application?/p>

371.   The Panel in Guatemala ?Cement I considered whether there had been sufficient evidence to justify an anti-dumping investigation under Article 5.3.⁽⁵⁰⁰⁾

372.   In determining what the parameters are of the requirement to “examine? the accuracy and adequacy of the evidence, and on what basis an assessment can be made regarding whether the necessary examination was carried out, the Panel in EC ?Bed Linen stated:

“The only basis, in our view, on which a panel can determine whether a Member’s investigating authority has examined the accuracy and adequacy of the information in the application is by reference to the determination that examination is in aid of ?the determination whether there is sufficient evidence to justify initiation. That is, if the investigating authority properly determined that there was sufficient evidence to justify initiation, that determination can only have been made based on an examination of the accuracy and adequacy of the information in the application, and consideration of additional evidence (if any) before it.?sup id="fntext-501">(501)

373.   Regarding a determination under Article 3.4, the Panel in Mexico ?Corn Syrup stated that ?a href="#article5A3">Article 5.3 does not impose an obligation on the investigating authority to set out its resolution of all underlying issues considered?⁽⁵⁰²⁾ Applied to the facts of the dispute, the Panel concluded that ?a href="#article5A3">Article 5.3 does not establish a requirement for the investigating authority to state specifically the resolution of questions concerning the exclusion of certain producers involved in defining the relevant domestic industry in the course of examining the accuracy and adequacy of the evidence to determine whether there was sufficient evidence to justify initiation.?sup id="fntext-503">(503)

374.   In Guatemala ?Cement II, the Panel agreed that “statements of conclusion unsubstantiated by facts do not constitute evidence of the type ?which allows an objective examination of its adequacy and accuracy by an investigating authority as provided in Article 5.3.?sup id="fntext-504">(504)

(c) Relationship with other paragraphs of Article 5

375.   The Panel in Guatemala ?Cement II discussed the relationship between Articles 5.2 and 5.3. See paragraph 356 above.

376.   The Panel in Guatemala ?Cement II rejected Mexico’s argument that a violation of Article 5.3 due to the initiation of an investigation in the absence of sufficient evidence necessarily constitutes a violation of Article 5.7. See paragraph 394 below.

377.   The Panel in Mexico ?Corn Syrup touched on the relationship between Articles 5.3 and 5.8. See paragraph 396 below.

378.   The Panel in Mexico ?Steel Pipes and Tubes looked at the relationship between Article 5.3 and Article 5.8. See paragraph 396 below.

4. Article 5.4

(a) General

379.   The Appellate Body in US ?Offset Act (Byrd Amendment) considered that Article 5.4 requires “no more than a formal examination of whether a sufficient number of domestic producers have expressed support for an application?⁽⁵⁰⁵⁾ The Appellate Body went on to note that Article 5.4 contains no requirement for investigating authorities to examine the motives of producers that elect to support (or to oppose) an application.⁽⁵⁰⁶⁾ The Appellate Body recalled that “there may be a number of reasons why a domestic producer could choose to support an investigation.?sup id="fntext-507">(507) The Appellate Body strongly disagreed with the approach taken by the Panel in relation to the concept of support⁽⁵⁰⁸⁾ and reached the following conclusion:

“A textual examination of Article 5.4 of the Anti-Dumping Agreement and Article 11.4 of the SCM Agreement reveals that those provisions contain no requirement that an investigating authority examine the motives of domestic producers that elect to support an investigation. Nor do they contain any explicit requirement that support be based on certain motives, rather than on others. The use of the terms ‘expressing support?and ‘expressly supporting?clarify that Articles 5.4 and 11.4 require only that authorities ‘determine?that support has been ‘expressed?by a sufficient number of domestic producers. Thus, in our view, an ‘examination?of the ‘degree? of support, and not the ‘nature?of support is required. In other words, it is the ‘quantity? rather than the ‘quality? of support that is the issue.?sup id="fntext-509">(509)

380.   The Panel in EC ?Salmon (Norway) found that the investigating authority wrongly defined the domestic industry, by excluding salmon producers that did not express an opinion regarding the investigation, producers that did not provide information to the investigating authority, producers of organic salmon, and producers of salmon fillets that did not also farm salmon fish. The Panel found that the authority’s assessment of whether the producers it did include accounted for “a major proportion?of domestic production of the like product was therefore based on incorrect information concerning the volume of total domestic production of the like product, as the information used related to a wrongly-defined industry; consequently it concluded that the determination was inconsistent with Article 5.4. As the EC had not obtained information on the production of the excluded producers, the Panel declined to make its own assessment as that would be de novo and prohibited.⁽⁵¹⁰⁾

381.   The Panel in EC ?Fasteners (China) rejected a claim under Article 5.4 because inter alia (a) the mere fact of revisiting after initiation a determination which had to be and was made prior to initiation does not undermine the validity of the pre-initiation determination of standing; (b) the complaining party had not demonstrated that there was any reason to doubt the accuracy of the official statistics used to evaluate standing; and (c) it would be inappropriate to base a finding of violation of Article 5.4, concerning a decision made prior to initiation, on the investigating authority not having considered information brought to its attention after the determination has been made and the investigation initiated.⁽⁵¹¹⁾

382.   In EC ?Fasteners (China), the Appellate Body declined to draw on the 25 per cent threshold in Article 5.4 as context for interpreting the phrase “a major proportion?in Article 4.1, because “the 25 per cent benchmark under Article 5.4 does not address the question of how the entire universe of the domestic industry itself should be defined.?sup id="fntext-512">(512)

(b) Relationship with Article 11.4 of the SCM Agreement

383.   In US ?Offset Act (Byrd Amendment), the Appellate Body further to noting that both Article 5.4 of the Anti-Dumping Agreement and Article 11.4 of the SCM Agreement are “identical?provisions, analysed them jointly. See paragraph 379 above.

5. Article 5.5

(a) “before proceeding to initiate?/p>

384.   In Guatemala ?Cement II, Mexico claimed that in violation of Article 5.5, Guatemala did not notify the Government of Mexico before proceeding to initiate the investigation. Guatemala argued that the effective date of initiation of the investigation was not 11 January 1996, the date alleged by Mexico, and maintained that according to its own Constitution and legislation, the investigating authority could not have initiated the investigation until the Government of Mexico had been officially notified. Referring to footnote 1 of the Anti-Dumping Agreement, the Panel first determined at what specific point in time the Guatemalan investigation had been initiated within the meaning of the Anti-Dumping Agreement:

“[T]he date of initiation is the date of the procedural action by which Guatemala formally commenced the investigation. We are of the view that in the case before us the action by which the investigation was formally commenced is the date of publication of the notice of initiation which occurred on 11 January 1996.?sup id="fntext-513">(513)

385.   The Panel in Guatemala ?Cement II further rejected Guatemala’s argument that “[it] could not have initiated the investigation until after it had notified Mexico?sup id="fntext-514">(514), because its own Constitution and laws mandated it to do so:

“In acceding to the WTO, Guatemala undertook to be bound by the rules contained in the AD Agreement, and our mandate is to review Guatemala’s compliance with those rules. The fact that the Constitution of Guatemala mandates that the investigating authorities proceed in a way which is consistent with its international obligations, does not validate the actions actually carried out by those authorities if those actions violate Guatemala’s commitments under the WTO. Whether Mexico chose not to pursue its rights under Guatemalan law is of no concern to us, as this would not affect its rights under the WTO Agreements?. ?sup id="fntext-515">(515)

386.   In Guatemala ?Cement II, the Panel also stated, with respect to Guatemala’s assertion that “in some cases Mexico has failed to notify the government of the investigated exporters in a timely fashion under Article 5.5?sup id="fntext-516">(516), that “[w]e are of the view that Mexico’s actions regarding notifications is of no relevance to issues before us in this case, which requires us to review the actions of the Guatemalan authorities.⁽⁵¹⁷⁾?sup id="fntext-518">(518)

(b) “notify the government?/p>

(i) General

387.   At its meeting of 29 October 1998, the Committee on Anti-Dumping Practices adopted a recommendation on the timing of notifications required under Article 5.5, providing that “the notification required by the second sentence of Article 5.5 should be made as soon as possible after the receipt by the investigating authorities of a properly documented application, and as early as possible before the decision is taken regarding initiation of an investigation on the basis of that properly documented application.?sup id="fntext-519">(519)

(ii) “Oral?notification

388.   In Thailand ?H-Beams, the Panel considered that a notification required under Article 5.5 can be made orally. The Panel stated:

?a href="#article5A5">Article 5.5 AD does not specify the form that the notification must take. The Concise Oxford Dictionary defines the term ‘notify? as: ‘inform or give notice to (a person)? ‘make known, announce or report (a thing)? We consider that the form of the notification under Article 5.5 must be sufficient for the importing Member to ‘inform? or ‘make known?to the exporting Member certain facts. While a written notification might arguably best serve this goal and the promotion of transparency and certainty among Members, and might also provide a written record upon which an importing Member could rely in the event of a subsequent claim of inconsistency with Article 5.5 of the AD Agreement, the text of Article 5.5 does not expressly require that the notification be in writing.⁽⁵²⁰⁾?sup id="fntext-521">(521)

(iii) Content of notification

389.   In Thailand ?H-Beams, the Panel examined what must be notified under Article 5.5, as follows:

“The text of Article 5.5 does not specify the contents of the notification. It provides: ‘after receipt of a properly documented application and before proceeding to initiate an investigation, the authorities shall notify the government of the exporting Member concerned?⁽⁵²²⁾ Because the text of the provision specifies that notification necessarily follows the receipt of a properly documented application, we consider that the fact of the receipt of a properly documented application would be an essential element of the contents of the notification.?sup id="fntext-523">(523)

(c) “Harmless error?with respect to Article 5.5 violation/Rebuttal against nullification or impairment presumed from a violation of Article 5.5

390.   In Guatemala ?Cement II, Guatemala argued that the alleged violations of Articles 5.5, 12.1.1 and 6.1.3 had not affected the course of the investigation, and thus, (a) the alleged violations were not harmful according to the principle of harmless error, (b) Mexico “convalidated?the alleged violations by not objecting immediately after their occurrence, and (c) the alleged violations did not cause nullification or impairment of benefits accruing to Mexico under the Anti-Dumping Agreement. The Panel first responded to the argument on “harmless error? concluding that “the concept of ‘harmless error?as presented by Guatemala?had not “attained the status of a general principle of public international law?

“In our view, the GATT panel referred to by Guatemala in support of its position merely stated that it did not wish ‘to exclude that the concept of harmless error could be applicable in dispute settlement proceedings under the Agreement.?sup id="fntext-524">(524) It therefore cannot be concluded that the GATT panel referred to ‘recognized the principle of harmless error ‘as alleged by Guatemala. We do not consider that the concept of ‘harmless error?as presented by Guatemala has attained the status of a general principle of public international law. In any event, we consider that our first task in this dispute is to determine whether Guatemala has acted consistently with its obligations under the relevant provisions of the AD Agreement. To the extent that Mexico can demonstrate that Guatemala has not respected its obligations under the relevant provisions of that Agreement, we must next consider arguments raised by Guatemala in respect of the nullification or impairment of benefits accruing to Mexico thereunder. Thus, while arguments regarding the existence and extent of the possible harm suffered by Mexico may be relevant to the issue of nullification or impairment,⁽⁵²⁵⁾ we do not consider that an argument of harmless error represents a defence in itself to an alleged infringement of a provision of the WTO Agreement.?sup id="fntext-526">(526)

391.   On the second argument put forward by Guatemala in the context of the alleged violations of Articles 5.5, 12.1.1 and 6.1.3, namely the lack of reaction from Mexico, the Panel found that “Mexico was under no obligation to object immediately to the violations it now alleges before the Panel?

“Guatemala uses both the concepts of ‘acquiescence?and ‘estoppel? in support of this argument. We note that ‘acquiescence?amounts to ‘qualified silence? whereby silence in the face of events that call for a reaction of some sort may be interpreted as a presumed consent.⁽⁵²⁷⁾ The concept of estoppel, also relied on by Guatemala in support of its argument, is akin to that of acquiescence. Estoppel is premised on the view that where one party has been induced to act in reliance on the assurances of another party, in such a way that it would be prejudiced were the other party later to change its position, such a change in position is ‘estopped? that is precluded.⁽⁵²⁸⁾

Regarding both arguments of acquiescence and estoppel we note that Mexico was under no obligation to object immediately to the violations it now alleges before the Panel.⁽⁵²⁹⁾ Mexico raised claims concerning Articles 5.5, 12.1.1 and 6.1.3 at an appropriate moment under the dispute settlement procedure envisaged by the AD Agreement and the DSU. Thus, Mexico cannot therefore be considered as having acquiesced to belated notification by Guatemala, to insufficiency in the public notice or to delay in providing the full text of the application, much less to have given ‘assurances?to Guatemala that it would not later challenge these actions in WTO dispute settlement. Since Mexico raised its claims at an appropriate moment under the WTO dispute settlement procedures, Guatemala could not have reasonably relied upon Mexico’s alleged lack of protest to conclude that Mexico would not bring a WTO complaint. In any event, Guatemala has not satisfied us that, had Mexico complained after the fact, but during the course of the investigation, Guatemala could or would have taken action to remedy the situation. Specifically, with respect to the delay in the Article 5.5 notification, Guatemala asserts that had Mexico objected to the notification delay in a timely manner, the Guatemalan authorities would have reinitiated the investigation after presenting Mexico with the notification under Article 5.5. We are of the view that this argument presented by Guatemala is highly speculative and note that the Panel has been established to rule on the WTO conformity of the actions by Guatemala and not on the WTO conformity of the actions Guatemala alleges it could have taken. In any event, Guatemala states at para. 217 of its first written submission that Mexico first raised the Article 5.5 issue on 6 June 1996, that is at a relatively early stage of the Ministry’s investigation, and precedes the Ministry’s preliminary affirmative determination. Nevertheless, Guatemala failed to take any steps to address the delayed Article 5.5 notification at that time. Based on these considerations the Panel rejects Guatemala’s defence that Mexico ‘convalidated?the alleged violations of Articles 5.5, 6.1.3 and 12.1.1 of the AD Agreement.?sup id="fntext-530">(530)

392.   The Panel in Guatemala ?Cement II then considered the third element of Guatemala’s argument in the context of the alleged violations of Articles 5.5, 12.1.1 and 6.1.3, namely that no nullification or impairment resulted from the alleged violation of Article 5.5. The Panel found that Guatemala did not rebut the presumption of nullification or impairment under Article 3.8 of the DSU, stating:

“There is no way to ascertain what Mexico might have done if it had received a timely notification. The extension of time for response to the questionnaire granted to Cruz Azul has no bearing on the fact that Mexico was not informed in time. Thus, we do not consider that Guatemala has rebutted the presumption of nullification or impairment with respect to violations of Article 5.5.?sup id="fntext-531">(531)

393.   The Panel also rejected Guatemala’s argument “that the Panel should examine Guatemala’s acts and decide whether the non-fulfilment of a procedural obligation should be overlooked on the grounds that the omission did not prejudice the rights of Mexico or [the Mexican producer on whose products anti-dumping duties had been imposed]?

“We could find no basis for such a distinction in the DSU, as suggested by Guatemala between substantive and ‘mere?procedural violations. There is no reason to regard violations of procedural obligations differently than obligation of a substantial nature. Compliance with the complete set of procedural rules relating to anti-dumping investigations, including those concerning notification and enhanced transparency, is required. This obligation to comply with all provisions, both procedural and substantive should not be taken lightly if one is not to devoid of all meaning the AD Agreement itself. As detailed in sections ?above we have found that Guatemala violated Articles 5.5, 6.1.3 and 12.1.1 of the AD Agreement by failing to timely notify Mexico of the decision to initiate an investigation, to timely provide Mexico and Cruz Azul a copy of the application, and to publish an adequate notice of initiation. We consider that a key function of the transparency requirements of the AD Agreement is to ensure that interested parties, including Members, are able to take whatever steps they deem appropriate to defend their interests. Where a required notification is not made in a timely fashion, or the application is not provided in time, or the public notice is inadequate the ability of the interested party to take such steps is vitiated. It is not for us to now speculate on what steps Mexico might have taken had it been timely notified or provided with the application, or had the public notice been adequate, and how Guatemala might have responded to those steps. Thus, while there is a possibility that the investigation would have proceeded in the same manner had Guatemala complied with its transparency obligations, we cannot state with certainty that the course of the investigation would not have been different.?sup id="fntext-532">(532)

6. Article 5.7

394.   In Guatemala ?Cement II, Mexico argued that because the application contained no evidence on injury, there was no evidence of dumping and injury for the investigating authority to consider at the time of initiation, and therefore there was a violation of Article 5.7; that is, the initiation of an investigation in the absence of sufficient evidence to justify initiation (contrary to Article 5.3) necessarily constitutes a violation of Article 5.7. Guatemala argued that its investigating authority had reviewed the available evidence on dumping and injury. The Panel held that Mexico had failed to present a prima facie case under Article 5.7, and held:

?a href="#article5A7">Article 5.7 requires the investigating authority to examine the evidence before it on dumping and injury simultaneously, rather than sequentially. We do not consider that the fulfilment of this requirement is conditioned in any way on the substantive nature of that evidence.?sup id="fntext-533">(533)

395.   The Panel in Argentina ?Poultry Anti-Dumping Duties rejected the argument that evidence of dumping and injury must cover simultaneous periods. It was thus of the view that an argument which concerned the substantive nature of the evidence considered by the authorities in the decision whether or not to initiate an investigation, rather than the timing of the consideration itself, was “outside the scope of the obligation contained in Article 5.7?⁽⁵³⁴⁾ The Panel considered that:

?a href="#article5A7">Article 5.7 imposes a procedural obligation on the investigating authority to examine the evidence before it of dumping and injury simultaneously, rather than sequentially, inter alia in the decision whether or not to initiate an investigation. We are of the view that Article 5.7 is not concerned with the substance of the decision to initiate an investigation, which is dealt with in Article 5.3 of the AD Agreement.?sup id="fntext-535">(535)

7. Article 5.8

(a) Rejection of an application to initiate an investigation

396.   The Panel in Mexico ?Corn Syrup found that ?a href="#article5A8">Article 5.8 does not impose additional substantive obligations beyond those in Article 5.3 on the authority in connection with the initiation of an investigation. That is, if there is sufficient evidence to justify initiation under Article 3.4, there is no violation of Article 5.8 in not rejecting the application.?sup id="fntext-536">(536) The Panel in Mexico ?Steel Pipes and Tubes made the same observation regarding the relationship between Article 5.3 and Article 5.8.⁽⁵³⁷⁾

397.   In Guatemala ?Cement II, the Panel rejected the argument that Article 5.8 applies only after an investigation is initiated, stating:

“[I]f the drafters intended that Article 5.8 apply only after initiation, the reference to promptly terminating an investigation would have sufficed. By referring to the rejection of an application Article 5.8 addresses the situation where an application has been received but an investigation has not yet been initiated. That the text of Article 5.8 continues after the quoted section to describe situations in which an initiated investigation should be terminated, does not support Guatemala’s argument that the whole of Article 5.8 applies only after the investigation has been initiated.??sup id="fntext-538">(538)

398.   The Panel in Guatemala ?Cement II also stated that the Panel Report in Mexico ?Corn Syrup does not support the interpretation that Article 5.8 applies only after an investigation has been initiated:

“The panel in Mexico ?HFCS determined that there had not been a violation of Article 5.3 as there was sufficient evidence to justify initiation. After having made that determination the Mexico ? HFCS panel proceeded to find that given that there was sufficient evidence to justify initiation under Article 3.4, there was no possible violation of Article 5.8. This in no way detracts from our position that Article 5.8 applies pre-initiation. The Panel in Mexico ?HFCS would not have even considered the question of whether rejection of the application was warranted if it had not considered that Article 5.8 applies before initiation.?sup id="fntext-539">(539)

399.   The Panel in US ?Lumber V stated that Article 5.8 does not require an investigating authority, after initiation, to continue to assess the sufficiency of the evidence in the application and to terminate the investigation on the grounds that other information undermines the sufficiency of that evidence:

“We can however find no basis to conclude that Article 5.8 imposes upon an investigating authority a continuing obligation after initiation to continue to assess the sufficiency of the evidence in the application and to terminate the investigation on the grounds that other information undermines the sufficiency of that evidence. Once an investigation has been initiated on the basis of sufficient evidence of dumping, the application has served its purpose. Logically, the continuing obligation to terminate an investigation where an investigating authority is satisfied that there is not sufficient evidence to justify proceeding must be based on an assessment of the overall state of the evidence deduced before it in the investigation, not on an assessment of the continuing sufficiency of the information in the application. We are of the view that it could not have been the intention of the drafters of Article 5.8 that its interpretation could result in that an investigation could have been initiated on the basis of sufficient evidence, but that the very same investigation had to be terminated if additional evidence was made available by the respondents at a later stage, while the evidence being gathered during the course of the investigation, indicates dumping?⁽⁵⁴⁰⁾

(b) “an immediate termination?/p>

400.   In Mexico ?Anti-Dumping Measures on Rice, the Appellate Body, confirming the Panel’s finding, held that “the second sentence of Article 5.8 requires the immediate termination of the investigation in respect of exporters for which an individual margin of dumping of zero or de minimis is determined.?sup id="fntext-541">(541) The Appellate Body noted that “for the purposes of Article 5.8, there is one investigation and not as many investigations as there are exporters or foreign producers? and that the Panel had made the point that Article 5.8 requires “immediate termination?of the investigation in respect of the individual exporter or producer for which a zero or de minimis margin is established.⁽⁵⁴²⁾ The Appellate Body further explained:

“The issuance of the order that establishes anti-dumping duties ?or the decision not to issue an order ?is the ultimate step of the ‘investigation?contemplated in Article 5.8; in most cases, an investigation is ‘terminated?with the issuance of an order or a decision not to issue an order ?Given that the issuance of the order establishing anti-dumping duties necessarily occurs after the final determination is made, the only way to terminate immediately an investigation, in respect of producers or exporters for which a de minimis margin of dumping is determined, is to exclude them from the scope of the order.?sup id="fntext-543">(543)

(c) “cases?/p>

401.   The Panel in US ?DRAMS was called upon to decide whether the scope of Article 5.8, as defined by the word “cases?in the second sentence, includes both antidumping investigations and Article 9.3 duty assessment procedures. The Panel held that it did not see “how the sufficiency of evidence concerning a subsequent duty assessment could be relevant to the treatment of an ‘application?or the conduct of an ‘investigation’”:

“First, the term ‘case?is used in the first sentence of Article 5.8. The first sentence is concerned explicitly and exclusively with the circumstances in which an ‘application?(‘under [Article 5,] paragraph 1? shall be rejected and an ‘investigation? terminated as a result of insufficient evidence to justify proceeding with the ‘case? As the treatment of the ‘application?and conduct of the ‘investigation?is dependent on the sufficiency of evidence concerning the ‘case? we consider that the term ‘case? in the first sentence must at least encompass the notions of ‘application? and ‘investigation? In our view, it would [be] meaningless for the term ‘case?in the first sentence to also encompass the concept of an Article 9.3 duty assessment procedure, since we fail to see how the sufficiency of evidence concerning a subsequent duty assessment could be relevant to the treatment of an ‘application?or the conduct of an ‘investigation? both of which precede the Article 9.3 duty assessment procedure. As we consider that the term ‘case?in the first sentence of Article 5.8 does not include the concept of ‘duty assessment? we see no reason to adopt a different approach to the term ‘cases?in the second sentence of that provision.?sup id="fntext-544">(544)

(d) ?i>de minimis?test

402.   Having determined (as noted in paragraph 401 above) that the term “cases?in Article 5.8 does not encompass the concept of an Article 9.3 duty assessment procedure,⁽⁵⁴⁵⁾ the Panel in US ?DRAMS then concluded that ?a href="#article5A8">Article 5.8, second sentence, does not require Members to apply a de minimis test in Article 9.3 duty assessment procedures?⁽⁵⁴⁶⁾ The Panel described the function of the Article 5.8 de minimis test as “to determine whether or not an exporter is subject to an anti-dumping order?and clearly distinguished this from any de minimis test applied under Article 9.3 duty assessment procedures.⁽⁵⁴⁷⁾

403.   For further discussion of this issue by the Panel in US ?DRAMS, see also paragraphs 671?a href="anti_dumping_03_e.htm#672">672 below.

(e) “margin of dumping?/p>

 404.   In Mexico ?Anti-Dumping Measures on Rice, the Appellate Body rejected Mexico’s argument that Article 5.8 requires the termination of the investigation only when the “country-wide margin of dumping?is de minimis, and confirmed the Panel’s view that the term “margin of dumping?in Article 5.8 refers to the individual margin of dumping of an exporter or producer rather than to a country-wide margin of dumping, to be consistent with the use of the term “margins of dumping?in Article 2.4.2.⁽⁵⁴⁸⁾

(f) Exclusion of exporters from subsequent administrative and changed circumstances reviews

405.   The Appellate Body in Mexico ?Anti-Dumping Measures on Rice, having found that the investigating authority must exclude from the anti-dumping measure any exporter found to have a zero or de minimis dumping margin (see paragraph 400 above), further agreed with the Panel that as a consequence:

“[S]uch exporters cannot be subject to administrative and changed circumstances reviews, because such reviews examine, respectively, the ‘duty paid?sup id="fntext-549">(549) and ‘the need for the continued imposition of the duty.?sup id="fntext-550">(550) Were an investigating authority to undertake a review of exporters that were excluded from the anti-dumping measure by virtue of their de minimis margins, those exporters effectively would be made subject to the anti-dumping measure, inconsistent with Article 5.8. The same may be said with respect to Article 11.9 of the SCM Agreement.?sup id="fntext-551">(551)

406.   Applying this reasoning, the Appellate Body in Mexico ?Anti-Dumping Measures on Rice concluded that by requiring the investigating authority to conduct a review for exporters with zero margins and de minimis margins, Article 68 of Mexico’s Foreign Trade Act was inconsistent with Article 5.8 of the Anti-Dumping Agreement and SCM Agreement Article 11.9.⁽⁵⁵²⁾

(g) Negligible import volumes

407.   On 27 November 2002, the Committee on Anti-Dumping Practices adopted the “Recommendation concerning the time-period to be considered in making a determination of negligible import volumes for purposes of Article 5.8 of the Agreement? as follows.⁽⁵⁵³⁾

“The Committee notes that Article 5.8 of the Agreement on Implementation of Article VI of GATT 1994 provides that there shall be immediate termination in cases where the authorities determine that the volume of dumped imports, actual or potential, is negligible. Article 5.8 also defines the volume of dumped imports from a particular country that shall normally be regarded as negligible. However, it does not establish a period of time over which imports are to be counted in determining whether the volume of imports is negligible. The Committee considers that guidance regarding an appropriate time-period for that determination would be useful.

In light of the foregoing, the Committee recommends that, with respect to original investigations to determine the existence of dumping and consequent injury, whether the volume of dumped imports, actual or potential, from a particular country is regarded as negligible shall be determined with reference to the volume of dumped imports from that country during:

(a)   the period of data collection for the dumping investigation; or

(b)   the most recent 12 consecutive months prior to initiation for which data are available; or

(c)   the most recent 12 consecutive months prior to the date on which the application was filed, for which data are available, provided that the lapse of time between the filing of the application and the initiation of the investigation is no longer than 90 days.

Not later than 60 days after the approval of this recommendation Members shall notify to the Committee on Anti-Dumping Practices which of the time-periods set out above, they will use in all investigations thereafter. If in any investigation the chosen methodology is not utilized, one of the two other methodologies shall be adopted, and an explanation shall be made in the public notice or separate public report of that investigation. Members which adopt the time-period mentioned in item (c) above shall also notify which of the other two time-periods they shall use in any case in which the lapse of time between the filing of the application and the initiation of the investigation is longer than 90 days, unless a Member’s domestic law prohibits such a lapse.?/p>

408.   Pursuant to this Recommendation, twenty-five Members have notified the time-periods that they use for determining negligible import volumes.⁽⁵⁵⁴⁾

(h) Relationship with other paragraphs of Article 5

409.   Regarding the relationship between Articles 5.3 and 5.8, see paragraph 396 above.

8. Relationship with other Articles

(a) Article 1

410.   The Guatemala ?Cement II Panel referred to footnote 1 to Article 1 in interpreting Article 5.5. See paragraph 384 above.

411.   In Guatemala ?Cement II, the Panel found that the subject anti-dumping duty order of Guatemala was inconsistent with several articles of the Anti-Dumping Agreement, among them Article 5. The Panel then opined that Mexico’s claims under other articles of the Anti-Dumping Agreement, among them Article 1, were “dependent claims, in the sense that they depend entirely on findings that Guatemala has violated other provisions of the AD Agreement.?sup id="fntext-555">(555) For this reason the Panel considered it not necessary to address these claims. See also paragraph 9 above.

(b) Article 2

412.   The Panel in Guatemala ?Cement II discussed the relationship between Articles 2, 5.2 and 5.3 in order to clarify the requirements under Article 3.4. See paragraph 356 above.

(c) Article 3

413.   The relationship between Article 5.2(iv) and Articles 3.2 and 3.4 was discussed in Mexico ?Corn Syrup. See paragraph 344 above.

414.   In Thailand ?H-Beams, the Appellate Body referred to Articles 3.7, 5.2 and 5.3 in interpreting Article 3.1. See paragraph 186 above.

415.   Article 3 was discussed in interpreting which elements of “injury? have to be supported by sufficient evidence under Article 3.4 in Guatemala ?Cement II. See paragraphs 363?a href="#364">364 above.

(d) Article 6

416.   In Guatemala ?Cement II, the Panel referred to Article 5.10 in examining Mexico’s claim under Article 6.1.3. See paragraph 453 below.

(e) Article 9

417.   In US ?DRAMS, the Panel discussed the relationship between Articles 5.8 and 9.3. See paragraphs 401?a href="#402">402 above, and 671?a href="anti_dumping_03_e.htm#672">672 below.

418.   In Guatemala ?Cement II, the Panel found that the subject anti-dumping duty order of Guatemala was inconsistent with several articles of the Anti-Dumping Agreement, among them Article 5. The Panel then determined that Mexico’s claims under other articles of the Anti-Dumping Agreement, among them Article 9, were “dependent claims, in the sense that they depend entirely on findings that Guatemala has violated other provisions of the AD Agreement.?sup id="fntext-556">(556) In light of this dependent nature of Mexico’s claim, the Panel considered it not necessary to address these claims. See also paragraph 9 above.

(f) Article 10

419.   In US ?Hot-Rolled Steel, the Panel interpreted the term “sufficient evidence?in Article 10.7 by reference to Article 5.3. See paragraph 728 below.

(g) Article 12

420.   The Panel in Guatemala ?Cement II touched on the relationship between Articles 5.3 and 12.1 in addressing a claim under Article 12.1. See paragraph 823 below.

421.   In Thailand ?H-Beams, the Panel discussed the difference between notification requirements in Articles 5.5 and 12.1. The Panel noted that each requires notification to the exporting Member’s government of certain events connected with initiation, but the requirements for timing, form and content of the notifications are different:

?a href="#article5A5">Article 5.5 makes it clear that the notification referred to in that provision must take place ‘after receipt of a properly documented application and before proceeding to initiate an investigation? By contrast, Article 12.1 of the AD Agreement concerns notification of initiation, as it requires notification to ‘the Member or Members the products of which are subject to such investigation…’, ‘[w]hen the authorities are satisfied that there is sufficient evidence to justify the initiation of an anti-dumping investigation pursuant to Article 5 …’ and requires ‘public notice?of initiation. As Article 12.1 provides that such ‘public notice?must ‘contain, or otherwise make available through a separate report, adequate information?? the notice must presumably be in writing. Furthermore, Article 12 involves the notification of a decision to initiate, which a Member may not yet have taken at the time of an Article 5.5 notification. That Article 12 specifically enumerates certain requirements with respect to the contents and form of the notice it requires, and Article 5.5 does not, strongly suggests to us that the requirements of Article 12 do not apply to notification under Article 5.5, and in no way changes our interpretation of the requirements concerning the timing, form and content of the notification to be given under Article 5.5.?sup id="fntext-557">(557)

(h) Article 17

422.   Regarding the application of the Article 17 standard of review to evaluation of claims under Article 3.4, see paragraphs 367?a href="#370">370 above.

(i) Article 18

423.   In Guatemala ?Cement II, the Panel found that the subject anti-dumping duty order of Guatemala was inconsistent with several articles of the Anti-Dumping Agreement, among them Article 5. The Panel then found that Mexico’s claims under other articles of the Anti-Dumping Agreement, among them Article 18, were “dependent claims, in the sense that they depend entirely on findings that Guatemala has violated other provisions of the AD Agreement.?sup id="fntext-558">(558) In light of this dependent nature of Mexico’s claim, the Panel considered it not necessary to address these claims. See also paragraph 9 above.

9. Relationship with other WTO Agreements

(a) Article VI of the GATT 1994

424.   In Guatemala ?Cement II, the Panel found that the subject anti-dumping duty order of Guatemala was inconsistent with several articles of the Anti-Dumping Agreement, among them Article 5. The Panel then opined that Mexico’s claims under other articles of the Anti-Dumping Agreement and under Article VI of GATT 1994, were “dependent claims, in the sense that they depend entirely on findings that Guatemala has violated other provisions of the AD Agreement.?sup id="fntext-559">(559) In light of this dependent nature of Mexico’s claim, the Panel considered it not necessary to address these claims. See also paragraph 9 above.