United States – COUNTERVAILING MEASURES ON CERTAIN PIPE
AND TUBE PRODUCTS FROM TURKEY
REport of the Panel
TABLE OF
CONTENTS
1 Introduction.. 16
1.1
Complaint by
Turkey. 16
1.2
Panel establishment and composition. 16
1.3
Panel proceedings. 16
1.3.1 General 16
1.3.2 Preliminary ruling request 17
2 Factual aspects. 17
3 Parties' requests for findings and
recommendations. 17
4 Arguments of the parties. 19
5 Arguments of the third parties. 19
6 Interim review... 19
7 Findings. 20
7.1
General principles regarding treaty interpretation, the applicable standard of
review, and burden of proof 20
7.1.1 Treaty interpretation. 20
7.1.2 Standard of review.. 20
7.1.3 Burden of proof 20
7.2
Turkey's claim under Article 1.1(a)(1) of the SCM Agreement in
relation to the USDOC's public body determinations in the OCTG, WLP, HWRP,
and CWP proceedings. 21
7.2.1 Introduction. 21
7.2.2 The legal standard applicable to the
public body enquiry. 21
7.2.3 The Panel's evaluation of
Turkey's Article 1.1(a)(1) claims in connection with the challenged
proceedings 22
7.2.3.1 Whether the USDOC's public
body determinations are inconsistent with Article 1.1(a)(1) of the
SCM Agreement 24
7.2.3.2 Whether the USDOC failed to
consider relevant evidence on the record related to Erdemir's commercial
conduct 32
7.2.3.3 Whether the
USDOC's assessment of OYAK is also inconsistent with
Article 1.1(a)(1) of the SCM Agreement 35
7.2.4 Conclusions regarding
Turkey's claims under Article 1.1(a)(1) of the SCM Agreement 35
7.3
Turkey's claims under Articles 1.1(b) and 14(d) of the
SCM Agreement in relation to the benefit determination in the OCTG
proceeding. 36
7.3.1 Introduction. 36
7.3.2 The United States' request
to exclude measures and claims from the Panel's terms of reference 37
7.3.2.1 Whether Turkey's panel
request adds a challenge regarding an alleged benefit "practice" that
was not the subject of Turkey's request for consultations. 37
7.3.2.2 Whether the Panel should make
findings on the benchmark determination in the OCTG investigation which was
successfully challenged in a US domestic court and reversed in a remand
determination. 41
7.3.3 The Panel's evaluation of
Turkey's "as such" challenge under Article 14(d) of the
SCM Agreement 45
7.3.4 Conclusions regarding
Turkey's claims under Articles 1.1(b) and 14(d) of the
SCM Agreement 51
7.4
Turkey's claims under Articles 2.1(c) and 2.4 of the
SCM Agreement in relation to the specificity determinations in the OCTG,
WLP, HWRP, and CWP proceedings. 51
7.4.1 Introduction. 51
7.4.2 The
Panel's evaluation of Turkey's Articles 2.1(c) and 2.4 claims. 52
7.4.2.1 Whether
the United States established the existence of a "subsidy
programme" for purposes of Article 2.1(c) of the SCM Agreement 53
7.4.2.1.1 2012‑2014 Medium Term Programme. 55
7.4.2.1.2 Erdemir's Annual Reports. 55
7.4.2.1.3 List of HRS transactions. 56
7.4.2.1.4 Consideration of the evidence in its totality. 57
7.4.2.2 Whether the United States considered the two
factors in the last sentence of Article 2.1(c) of the SCM Agreement 57
7.4.2.2.1
Economic diversification. 58
7.4.2.2.2
Length of time that the "subsidy programme" has been in operation. 59
7.4.3
Conclusions regarding Turkey's Article 2.1(c) and 2.4 claims. 61
7.5
Turkey's claims under Article 12.7 of the SCM Agreement in
relation to the use of facts available in the OCTG, WLP, and HWRP proceedings. 61
7.5.1 Introduction. 61
7.5.2 The use of facts available in the
OCTG investigation. 61
7.5.2.1 Factual background. 61
7.5.2.2 The Panel's evaluation of
Turkey's claim regarding the use of facts available in the OCTG
investigation 62
7.5.2.2.1 Failure to take into account the
difficulties. 63
7.5.2.2.2 Punitive application of facts available. 64
7.5.2.2.2.1 The selection of the lowest price on the record. 67
7.5.2.2.2.2 The selection of quantities of HRS purchases on the
basis of the full capacity of the non‑responding facilities and
Gemlik's ratio of HRS purchases from Erdemir and Isdemir 68
7.5.3 The use of facts available in the
WLP investigation. 70
7.5.3.1 Factual background. 70
7.5.3.2 Whether Turkey's claims under
Article 12.7 of the SCM Agreement in respect of "all
investigated programs" in the WLP investigation are within the
Panel's terms of reference. 70
7.5.3.3 The Panel's evaluation of
Turkey's claim regarding the use of facts available in the WLP
investigation 75
7.5.4 The use of facts available in the
HWRP investigation. 77
7.5.4.1 Factual background. 77
7.5.4.2 The Panel's evaluation of
Turkey's claim regarding the use of facts available in the HWRP
investigation 78
7.5.5 Conclusions regarding
Turkey's Article 12.7 claims. 80
7.6
Turkey's claims under Article 15.3 of the SCM Agreement in
relation to the cumulative assessment of the effects of imports in the OCTG,
WLP, HWRP, and CWP proceedings. 81
7.6.1 Introduction. 81
7.6.2 Whether Turkey's panel request
adds a challenge regarding alleged injury determination "practices"
that were not the subject of Turkey's request for consultations. 81
7.6.3 Turkey's claims concerning the
cumulation of subsidized and dumped, non‑subsidized imports in original
countervailing investigations. 83
7.6.3.1 Whether the USITC cumulated
subsidized and dumped, non‑subsidized imports in the OCTG, WLP, and HWRP
original investigations inconsistently with Article 15.3 of the
SCM Agreement 87
7.6.3.2 Whether the USITC has a practice
of cumulating subsidized and dumped, non‑subsidized imports in original
investigations that is inconsistent "as such" with Article 15.3
of the SCM Agreement 88
7.6.4 Turkey's claims concerning
cumulation of subsidized and dumped, non‑subsidized imports in sunset reviews 92
7.6.5 Conclusions regarding
Turkey's claims under Article 15.3 of the SCM Agreement 94
7.7
Turkey's claims under Article 19.4 of the SCM Agreement and
Article VI:3 of
the GATT 1994. 95
7.8
Turkey's claims under Articles 10 and 32.1 of the SCM Agreement 97
8 Conclusions and Recommendation.. 97