Despite WTO Rulings U.S. Continues Use of Zeroing, Invites Public Comments
January 13, 2009
In December 2008, a World Trade Organization panel again held that a methodology used by the U.S. Department of Commerce in calculating dumping margins fails to meet U.S. obligations under various agreements including the General Agreements on Tariffs and Trade (GATT) and the Anti-Dumping Agreement. The methodology, known as zeroing, used in antidumping (AD) proceedings tends to result in increased AD duty rates by ignoring certain values that could offset higher dumping margins.
The European Union won its initial challenge in 2005 on the use of zeroing in 52 investigations, administrative reviews, and sunset reviews. The 2008 panel found that the U.S. has failed to implement most of the 2005 decision’s recommendations.
For its part, the U.S. has vigorously defended its use of zeroing and has argued that its right to use the methodology should be preserved in the final Doha Round agreement. In 2007, the U.S. Trade Representative (USTR) submitted a proposal urging the implementation of clear rules permitting zeroing in all AD proceedings. The proposal has relatively strong support in the U.S. Congress, where many of its members view WTO decisions against zeroing as unlawful restrictions on U.S. trade laws.
However, the U.S. continues to face an uphill battle internationally, as more countries continue to file complaints challenging the methodology at the WTO. Most recently, Brazil and Thailand filed complaints challenging the use of zeroing in AD investigations concerning imports of orange juice and polyethylene retail carrier bags. >has signaled that it will contest these complaints and is accepting comments regarding these matters by January 26, 2009 and January 30, 2009, respectively.