Australia – Anti‑dumping and Countervailing Duty Measures
on Certain Products from China
Report of the Panel
TABLE OF
CONTENTS
1 INTRODUCTION.. 14
1.1
Complaint by China. 14
1.2
Panel establishment and composition. 14
1.3
Panel proceedings. 14
1.3.1
General 14
1.3.2
Working procedures concerning Business Confidential Information. 15
1.3.3
Preliminary ruling request 15
1.3.4
Agreed Procedures for Arbitration under Article 25 of the DSU. 15
2 FACTUAL ASPECTS. 16
2.1
The measures at issue. 16
2.2
The underlying proceedings. 16
2.2.1
Wind towers. 17
2.2.1.1
Original investigation (Investigation 221) 17
2.2.1.2
Five‑year expiry review (Continuation 487) 17
2.2.1.3
Administrative review in relation to TSP. 17
2.2.2
Stainless steel sinks. 17
2.2.2.1
Original investigation (Investigation 238) 17
2.2.2.2
First interim review in relation to SCEA. 18
2.2.2.3
Second interim review in relation to SCEA. 18
2.2.2.4
Interim review in relation to Yingao. 18
2.2.2.5
Five‑year expiry review (Continuation 517) 19
2.2.2.6
Administrative review in relation to Primy and Zhuhai Grand. 19
2.2.3
Railway wheels original investigation (Investigation 466) 19
3 PARTIES' REQUESTS FOR FINDINGS AND
RECOMMENDATIONS. 19
4 ARGUMENTS OF THE PARTIES. 20
5 ARGUMENTS OF THE THIRD PARTIES. 20
6 INTERIM REVIEW.. 20
7 FINDINGS. 20
7.1
Treaty interpretation and standard of review. 20
7.1.1
Treaty interpretation. 20
7.1.2
Standard of review. 20
7.2
Expiry of measures and Australia's challenges under Article 6.2 of the DSU. 21
7.2.1
Main party arguments. 21
7.2.1.1
Expiry of measures. 21
7.2.1.2
Article 6.2 of the DSU. 26
7.2.2
Approach to expiry. 27
7.2.3
Australia's claims under Article 6.2 of the DSU. 30
7.3
Wind towers. 32
7.3.1
AD claim 3 under Article 2.2.1.1 of the Anti‑Dumping Agreement: rejection
of
exporters' costs. 32
7.3.1.1
Legal framework. 32
7.3.1.2
Main party arguments. 33
7.3.1.3
Expiry. 34
7.3.1.4
Evaluation. 36
7.3.2
AD claim 1 under Article 2.2 of the Anti‑Dumping Agreement: costs of production
in the country of origin. 39
7.3.2.1
Legal framework. 39
7.3.2.2
Main party arguments. 40
7.3.2.3
Expiry. 41
7.3.2.4
Evaluation. 42
7.3.3
AD claim 5.c under Article 2.2.1.1 of the Anti‑Dumping Agreement:
"manner" and "circumstances" of rejection of exporters'
costs. 43
7.3.3.1
Main party arguments. 43
7.3.3.2
Expiry. 44
7.3.3.3
Evaluation. 44
7.3.4
AD claim 6.a under Article 2.4 of the Anti‑Dumping Agreement: fair
comparison. 44
7.3.4.1
Legal framework. 44
7.3.4.2
Main party arguments. 45
7.3.4.3
Expiry. 46
7.3.4.4
Evaluation. 46
7.3.5
AD claim 7 under Articles 2.2 and 2.2.2 of the Anti‑Dumping Agreement 46
7.3.5.1
Legal framework. 46
7.3.5.2
AD claim 7.a: Profits not based on "actual data" 47
7.3.5.2.1
Main party arguments. 47
7.3.5.2.2
Expiry. 48
7.3.5.2.3
Evaluation 48
7.3.5.3
AD claim 7.c: Inconsistency in "like products" determination. 49
7.3.5.3.1
Main party arguments. 49
7.3.5.3.2
Expiry. 50
7.3.5.3.3
Evaluation. 50
7.3.6
AD claim 8 under Article 9.3 of the Anti-Dumping Agreement and Article
VI:2 of
the GATT 1994: collection of duties in excess of the margin of dumping 52
7.3.6.1
Main party arguments. 52
7.3.6.2
Evaluation. 52
7.4
Stainless steel sinks. 53
7.4.1
AD claim 3 under Article 2.2.1.1 of the Anti‑Dumping Agreement: rejection
of exporters' costs. 53
7.4.2
AD claim 4 under Articles 2.2.1.1 and 2.2.1 of the Anti‑Dumping Agreement:
use of correct "costs" in the ordinary-course-of-trade test 53
7.4.2.1
Legal framework. 53
7.4.2.2
Main party arguments. 54
7.4.2.3
Expiry. 56
7.4.2.4
Evaluation. 58
7.4.3
AD claim 1 under Article 2.2 of the Anti‑Dumping Agreement: costs of
production
in the country of origin. 58
7.4.4
AD claim 2 under Articles 2.2 and 2.2.1 of the Anti‑Dumping Agreement:
use of correct "costs" in the ordinary-course-of-trade test 59
7.4.4.1
Main party arguments. 59
7.4.4.2
Expiry. 60
7.4.4.3
Evaluation. 61
7.4.5
AD claim 6.a under Article 2.4 of the Anti‑Dumping Agreement: due allowance
to ensure a fair comparison. 62
7.4.5.1
Main party arguments. 63
7.4.5.2
Expiry. 63
7.4.5.3
Evaluation. 64
7.4.6
AD claim 6.b under Article 2.4 of the Anti‑Dumping Agreement 64
7.4.6.1
AD claim 6.b.i: VAT adjustment 64
7.4.6.1.1
Main party arguments. 64
7.4.6.1.2
Expiry. 65
7.4.6.1.3
Evaluation. 67
7.4.6.1.3.1
Whether the ADC failed to provide a reasoned and adequate explanation
that the differences in VAT recoverability affected price comparability. 67
7.4.6.1.3.2
The methodology applied by the ADC to calculate the VAT adjustment 68
7.4.6.2
AD claim 6.b.ii: differences relating to accessories. 70
7.4.6.2.1
Main party arguments. 70
7.4.6.2.2
Evaluation. 72
7.4.6.2.2.1
Treating accessories purchased from third‑party suppliers differently from
accessories produced internally by the exporting producer 72
7.4.6.2.2.2
Failure to use actual accessory costs to calculate adjustment 73
7.4.6.3
AD claim 6.b.iii: comparison of export models to other export models. 76
7.4.6.3.1
Main party arguments. 76
7.4.6.3.2
Evaluation. 77
7.4.7
AD claim 7.a under Article 2.2.2 of the Anti‑Dumping Agreement: profits
not based on "actual data" 78
7.4.7.1
Main party arguments. 78
7.4.7.2
Expiry. 79
7.4.8
AD claim 8 under Article 9.3 of the Anti-Dumping Agreement: collection of
duties
in excess of the margin of dumping. 79
7.4.8.1
Main party arguments. 79
7.4.8.2
Evaluation........................................................................................................... 80
7.4.9
CVD claims 2 and 3 under Articles 1.1(b) and 14(d) of the
SCM Agreement:
use of out of country benchmark 80
7.4.9.1
Main party arguments. 80
7.4.9.2
Expiry. 82
7.4.10
CVD claim 4 under Articles 1.2 and 2.1(c) of the SCM Agreement:
specificity determination of Program 1. 83
7.4.10.1
Main party arguments 83
7.4.10.2
Expiry. 85
7.4.11
CVD claim 5 under Articles 11.2 and 11.3 of the SCM Agreement: initiation
of investigation for Program 1. 85
7.4.11.1
Main party arguments. 85
7.4.11.2
Expiry. 88
7.5
Railway wheels. 89
7.5.1
AD claim 3 under Article 2.2.1.1 of the Anti‑Dumping Agreement: rejection
of
exporters' costs. 89
7.5.1.1
Main party arguments. 90
7.5.1.2
Evaluation. 91
7.5.2
AD claim 1 under Article 2.2 of the Anti‑Dumping Agreement: costs of
production
in the country of origin. 92
7.5.2.1
Main party arguments. 92
7.5.2.2
Evaluation. 93
7.5.3
AD claim 5.d under Articles 2.2 and 2.2.1.1 of the Anti‑Dumping Agreement: the
"manner and circumstances" of rejection of exporters' costs. 94
7.5.3.1
Main party arguments. 94
7.5.3.2
Evaluation. 95
7.5.4
AD claim 6.a under Article 2.4 of the Anti‑Dumping Agreement 95
7.5.4.1
Main party arguments. 95
7.5.4.2
Evaluation. 96
7.5.5
AD claim 7.b under Article 2.2.2 of the Anti-Dumping Agreement: profits not
actually realized in the domestic market 96
7.5.5.1
Main party arguments. 96
7.5.5.2
Evaluation. 97
7.5.6
AD claim 8 under Article 9.3 of the Anti‑Dumping Agreement: collection of
duties in excess of the margin of dumping. 99
7.5.6.1
Main party arguments. 99
7.5.6.2
Evaluation. 99
7.6
Whether to issue findings and recommendations for expired aspects
of the anti‑dumping and countervailing duty orders. 100
8 Conclusions and recommendations. 101