India – certain measures on imports
of iron and steel products

report of the panel

TABLE OF CONTENTS

1   Introduction.. 14

1.1   Complaint by Japan. 14

1.2   Panel establishment and composition. 14

1.3   Panel proceedings. 14

2   Measure at issue and other Factual aspects. 15

3   Parties' requests for findings and recommendations. 15

4   Arguments of the parties. 17

5   Arguments of the third parties. 17

6   Interim Review... 17

7   Findings. 17

7.1   Introduction. 17

7.2   General principles regarding standard of review, treaty interpretation, and burden of proof ........... 17

7.2.1   Standard of review.. 17

7.2.2   Treaty interpretation. 19

7.2.3   Burden of proof 19

7.3   Whether the Panel should make findings despite the expiry of the measure at issue. 20

7.3.1   Introduction. 20

7.3.2   Evaluation by the Panel 21

7.4   Whether Article XIX of the GATT 1994 and the Agreement on Safeguards are applicable to the present dispute  24

7.4.1   Introduction. 24

7.4.2   Whether the measure at issue constitutes an ordinary customs duty. 25

7.4.3   Whether the measure at issue resulted in the suspension of a GATT obligation. 27

7.4.3.1   Article II:1(b) of the GATT 1994. 28

7.4.3.2   Article I:1 of the GATT 1994. 29

7.4.3.3   Article XXIV of the GATT 1994. 31

7.4.4   Conclusion. 34

7.5   Whether India acted inconsistently with Article XIX:1(a) of the GATT 1994 with respect to the existence of "unforeseen developments" and the effect of GATT obligations. 34

7.5.1   Introduction. 34

7.5.2   The Indian competent authority's determination. 35

7.5.3   Article XIX:1(a) of the GATT 1994. 36

7.5.4   The existence of unforeseen developments. 37

7.5.5   Logical connection between unforeseen developments and the increased imports. 39

7.5.6   Effect of the obligations incurred under the GATT 1994. 43

7.5.7   Conclusion. 44

7.6   Whether India acted inconsistently with Articles 2.1 and 4.2(a) of the Agreement on Safeguards and Article XIX:1(a) of the GATT 1994 with respect to the increase in imports. 45

7.6.1   Introduction. 45

7.6.2   The Indian competent authority's determination on increased imports. 45

7.6.3   Articles 2.1 and 4.2(a) of the Agreement on Safeguards. 46

7.6.4   Evaluation by the Panel 47

7.6.5   Conclusion. 51

7.7   Whether India acted inconsistently with Articles 2.1, 4.1(a), 4.1(b), 4.1(c), 4.2(a), and 4.2(b) of the Agreement on Safeguards and Article XIX:1(a) of the GATT 1994 with respect to its determination of the domestic industry  51

7.7.1   Introduction. 51

7.7.2   Article 4.1(c) of the Agreement on Safeguards. 51

7.7.3   Evaluation by the Panel 52

7.8   Whether India acted inconsistently with Articles 2.1, 4.1(a), 4.1(b), and 4.2(a) of the Agreement on Safeguards and Article XIX:1(a) of the GATT 1994 with respect to its determination of serious injury and threat of serious injury  55

7.8.1   Introduction. 55

7.8.2   The Indian competent authority's determination regarding serious injury and threat thereof 55

7.8.3   Serious Injury. 56

7.8.3.1   Articles 4.1(a) and 4.2(a) of the Agreement on Safeguards. 56

7.8.3.2   Whether the Indian competent authority evaluated relevant injury factors consistently with Articles 4.1(a) and 4.2(a) 57

7.8.3.2.1   The share of the domestic market taken by increased imports. 57

7.8.3.2.2   Profits and losses. 60

7.8.3.2.3   Evaluation of injury factors showing stable or positive trends. 63

7.8.3.2.4   Conclusion. 65

7.8.3.3   Whether the Indian competent authority failed to base its serious injury determination on objective data  65

7.8.4   Threat of serious injury. 66

7.8.5   Consequential claim under Article 2.1 of the Agreement on Safeguards and Article XIX:1(a) of the GATT 1994  69

7.9   Whether India acted inconsistently with Articles 2.1, 4.2(a) and 4.2(b) of the Agreement on Safeguards and Article XIX:1(a) of the GATT 1994 with respect to its determination of the causal link between the increase in imports and serious injury. 69

7.9.1   Introduction. 69

7.9.2   Article 4.2(b) of the Agreement on Safeguards. 69

7.9.3   Causal link analysis. 71

7.9.4   Non‑attribution analysis. 75

7.9.4.1   Introduction and general considerations relevant to Japan's claims on non‑attribution analysis  75

7.9.4.2   The captive sales of domestic industry and sales of producers outside the domestic industry  77

7.9.4.3   The domestic industry's own internal factors. 78

7.9.4.4   Other factors causing the decline in profitability. 79

7.9.4.5   Conclusion. 80

7.9.5   Consequential claims. 80

7.10   Whether India acted inconsistently with Articles 5.1 and 7.1 of the Agreement on Safeguards and Article XIX:1(a) of the GATT 1994. 80

7.11   Whether India acted inconsistently with Articles 3.1 and 4.2(c) of the Agreement on Safeguards  81

7.12   Whether India acted inconsistently with Article 11.1(a) of the Agreement on Safeguards. 82

7.13   Whether India acted inconsistently with Article 12 of the Agreement on Safeguards in notifying its measure and providing opportunities for consultations. 83

7.13.1   Japan's claim under Article 12.4 of the Agreement on Safeguards. 83

7.13.1.1   Introduction. 83

7.13.1.2   Evaluation by the Panel 84

7.13.1.3   Conclusion. 84

7.13.2   Japan's claim under Article 12.1 of the Agreement on Safeguards. 84

7.13.2.1   Introduction. 84

7.13.2.2   Evaluation by the Panel 86

7.13.2.2.1   Japan's claim under Article 12.1(a) 87

7.13.2.2.2   Japan's claim under Article 12.1(b) 88

7.13.2.2.3   Japan's claim under Article 12.1(c) 89

7.13.2.3   Conclusion. 90

7.13.3   Japan's claim under Article 12.2 of the Agreement on Safeguards. 90

7.13.3.1   Introduction. 90

7.13.3.2   Evaluation by the Panel 92

7.13.3.3   Conclusion. 96

7.13.4    Japan's claim under Article 12.3 of the Agreement on Safeguards and Article XIX:2 of the GATT 1994  97

7.13.4.1   Introduction. 97

7.13.4.2   Evaluation by the Panel 98

7.13.4.3   Conclusion. 98

7.14   Whether India acted inconsistently with Article II:1(b) of the GATT 1994. 98

7.14.1   Introduction. 98

7.14.2   Article II:1(b) of the GATT 1994. 99

7.14.3   Evaluation by the Panel 99

7.14.4   Conclusion. 101

7.15   Whether India acted inconsistently with Article I:1 of the GATT 1994. 101

7.15.1   Introduction. 101

7.15.2   Article I:1 of the GATT 1994. 101

7.15.3   Evaluation by the Panel 101

7.15.4   Conclusion. 103

7.16   Special and differential treatment 103

8   Conclusions and Recommendation.. 104

8.1   Conclusions. 104

8.2   Recommendation. 105