WTO Dispute Settlement Proceeding Regarding Countervailing Duty Measures Concerning Certain Products from the European Communities

AGENCY:

Office of the United States Trade Representative.

ACTION:

Notice; request for comments.

SUMMARY:

The Office of the United States Trade Representative (“USTR”) is providing notice that the European Communities (“EC”) has requested the establishment of a dispute settlement panel under the Marrakesh Agreement Establishing the World Trade Organization (“WTO Agreement”). That request may be found at http://www.wto.org contained in a document designated as WT/DS212/15. As a result of that request, a dispute settlement panel has been established to examine certain sunset review determinations by the United States Department of Commerce (“Commerce”). USTR invites written comments from the public concerning the issues raised in this dispute.

DATES:

Although USTR will accept any comments received during the course of the dispute settlement proceedings, comments should be submitted on or before January 31, 2005, to be assured of timely consideration by USTR.

ADDRESSES:

Comments should be submitted (i) electronically, to FR0504@ustr.eop.gov, Attn: “Change in Ownership Methodology Dispute” in the subject line, or (ii) by fax, to Sandy McKinzy at 202-395-3640, with a confirmation copy sent electronically to the e-mail address above.

FOR FURTHER INFORMATION CONTACT:

Elizabeth V. Baltzan, Associate General Counsel, Office of the United States Trade Representative, 600 17th Street, NW., Washington, DC 20508, (202) 395-3582.

SUPPLEMENTARY INFORMATION:

Section 127(b) of the Uruguay Round Agreements Act (“URAA”) (19 U.S.C. 3537(b)(1)) requires that notice and opportunity for comment be provided after the United States submits or receives a request for the establishment of a WTO dispute settlement panel. The dispute settlement panel, which will hold its meetings in Geneva, Switzerland, is expected to issue a report on its findings and recommendations by May, 2005.

Major Issues Raised by the EC

On January 8, 2003, the WTO Dispute Settlement Body (“DSB”) adopted the Appellate Body report and the panel report, as modified by the Appellate Body, in the case WT/DS212 (United States—Countervailing Measures concerning Certain Products from the European Communities). These reports involved the “change-in-ownership” methodology applied by Commerce in proceedings under the U.S. countervailing duty law. The DSB recommended that the United States bring its administrative practice and the twelve individual determinations found to be inconsistent with the Agreement on Subsidies and Countervailing Measures (“SCM Agreement”) into conformity with its WTO obligations.

On January 27, 2003, the United States informed the DSB that it intended to implement the recommendations and rulings of the DSB in a manner consistent with its WTO obligations. After publishing a modification of its change-in-ownership methodology, Commerce applied that new methodology to the twelve individual determinations that had been found by the DSB to be inconsistent with U.S. WTO obligations. Commerce issued final revised determinations November 7, 2003. Also on November 7, 2003, the United States informed the DSB that it had fully complied with the DSB's recommendations and rulings.

On March 17, 2004, the EC initiated proceedings under Article 21.5 of the DSU by requesting consultations with the United States. In its consultation request, the EC alleged that the United States had not fully complied with the DSB's recommendations and rulings. Because consultations did not resolve the matter, the EC requested the establishment of a panel pursuant to Articles 6 and 21.5 of the DSU, Article 30 of the SCM Agreement, and Article XXIII of the General Agreement on Tariffs and Trade 1994 (“GATT 1994”). The DSB established the panel and referred the matter to the original panelists.

In its panel request, the EC identifies the following measures and claims:

• With respect to the revised determination in the sunset review on Certain Corrosion-Resistant Carbon Steel Flat Products from France (C-427-810), the EC claims that Commerce failed to properly examine the existence, continuation or likelihood of recurrence of subsidization. In particular, with regard to the privatization concerned, the EC alleges that Commerce improperly analysed the consequences of the price charged to employees and retirees for shares in the privatized company. The EC claims that this is inconsistent with Articles 10, 14, 19.4, 21.1 and 21.3 of the SCM Agreement and Article VI: 3 of GATT 1994.
• With respect to the revised determinations in the sunset reviews on Cut-to-Length Carbon Steel Plate from United Kingdom (C-412-815), and Cut-to-Length Carbon Steel Plate from Spain (C-469-804) (Case No. 11), the EC claims that Commerce failed to properly determine whether there was continuation or recurrence of subsidization and injury, because Commerce did not examine the nature of the privatizations in question and their impact on the continuation of the alleged subsidization. According to the EC, this is inconsistent with Articles 10, 14, 19.4, 21.1 and 21.3 of the SCM Agreement and Article VI:3 of GATT 1994.

Public Comment: Requirements for Submissions.

Interested persons are invited to submit written comments concerning the issues raised in this dispute. Persons submitting comments may either send one copy by fax to Sandy McKinzy at (202) 395-3640, or transmit a copy electronically to FR0504@ustr.eop.gov, with “Change in Ownership Methodology Dispute (DS212)” in the subject line. For documents sent by fax, USTR requests that the submitter provide a confirmation copy to the electronic mail address listed above.

USTR encourages the submission of documents in Adobe PDF format, as attachments to an electronic mail. Interested persons who make submissions by electronic mail should not provide separate cover letters; information that might appear in a cover letter should be included in the submission itself. Similarly, to the extent possible, any attachments to the submission should be included in the same file as the submission itself, and not as separate files.

A person requesting that information contained in a comment submitted by that person be treated as confidential business information must certify that such information is business confidential and would not customarily be released to the public by the submitter. Confidential business information must be clearly designated as such and the submission must be marked “BUSINESS CONFIDENTIAL” at the top and bottom of the cover page and each succeeding page of the submission.

Information or advice contained in a comment submitted, other than business confidential information, may be determined by USTR to be confidential in accordance with section 135(g)(2) of the Trade Act of 1974 (19 U.S.C. 2155(g)(2)). If the submitting person believes that information or advice may qualify as such, the submitting person—

(1) Must clearly so designate the information or advice;

(2) Must clearly mark the material as “SUBMITTED IN CONFIDENCE'at the top and bottom of each page of the cover page and each succeeding page; and

(3) Is encouraged to provide a non-confidential summary of the information or advice.

Pursuant to section 127(e) of the URAA (19 U.S.C. 3537(e)), USTR will maintain a file on this dispute settlement proceeding, accessible to the public, in the USTR Reading Room, which is located at 1724 F Street, NW., Washington, DC 20508. The public file will include non-confidential comments received by USTR from the public with respect to the dispute; if a dispute settlement panel is convened, the U.S. submissions to that panel, the submissions, or non-confidential summaries of submissions, to the panel received from other participants in the dispute, as well as the report of the panel; and, if applicable, the report of the Appellate Body. An appointment to review the public file (Docket No. WT/DS-212, Change in Ownership Methodology Dispute) may be made by calling the USTR Reading Room at (202) 395-6186. The USTR Reading Room is open to the public from 9:30 a.m. to noon and 1 p.m. to 4 p.m., Monday through Friday.