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“Mixed Result” in WTO Case Challenging CV Duties on Steel Products from India

Tuesday, July 15, 2014
Sandler, Travis & Rosenberg Trade Report

A World Trade Organization dispute settlement panel has issued a “mixed result” in a challenge against U.S. countervailing duties against certain steel products from India, according to the Office of the U.S. Trade Representative.

A USTR press release states that the panel rejected:

- most of India’s claims against U.S. CV duty laws and regulations “as such” under the WTO Agreement on Subsidies and Countervailing Measures;

- all of India’s challenges under Article 14(d), 19.3 and 19.4 to DOC’s benchmark regulations, which are used to determine whether a subsidy has conferred a benefit;

- India’s claims that the U.S. statute and regulations allowing for the use of “facts available” in instances where responding companies fail to cooperate with an investigation violates Article 12 of the SCM Agreement;

- most of the challenges against the Department of Commerce’s case-specific determinations, including challenges to over 300 instances of the use of “facts available,” DOC’s benchmark calculations and specificity determinations, findings that two Indian entities constituted public bodies and were thus subject to WTO subsidy disciplines, and DOC’s inclusion of new subsidy programs in CV duty review proceedings.

On the other hand, the panel found that the U.S. measure allowing for cross-cumulation of dumped and subsidized imports when assessing injury in certain International Trade Commission determinations breaches WTO rules (although it rejected other challenges against ITC’s injury determination in the underlying investigation). The panel also found that DOC’s determinations with respect to the provision of high grade iron ore breached Articles 2.1(c) and 14(d) of the SCM Agreement in that Commerce failed to take account of all the mandatory factors in its determinations of de facto specificity and also failed to consider relevant domestic price information. With respect to India’s captive mining programs, the panel found that DOC breached Article 12.5 by failing to determine the existence of a captive mining program for iron ore on the basis of accurate information, Article 1.1(a)(1)(iii) because there was an insufficient evidentiary basis to find a financial contribution, and Article 14(d) in connection with DOC’s rejection of certain domestic price information.

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