Industry News

WTO Establishes Panel to Address US Zeroing Practice on EU's Request

June 6, 2007


Recently, the World Trade Organization (WTO) established a panel to investigate antidumping duties that the U.S. applies on 52 European products. These products range from ball bearings to pasta and the issue under consideration is the US methodology of treating all transactions in which there is no dumping as having a "zero" margin, rather than applying the actual percent by which there is no dumping. The May 11, 2007 request by the EU to the Dispute Settlement Body (DSB) of the WTO urges the DSB to address US methodology with regards to: (a) the general practice of using zeroing, and (b) the application of zeroing in certain specified antidumping measures maintained by the U.S.

Analysts say that the U.S. has already been exploring this issue in light of the October 31, 2005 WTO Panel Report which found the U.S. methodology to be inconsistent with Article 2.4.2 of the Antidumping Agreement. In fact, on December 27, 2006 the United States Department of Commerce decided to modify its methodology in antidumping investigations with respect to the calculation of the weighted-average dumping margin to implement the recommendations of the WTO Dispute Settlement Body. The implementation date was later changed to January 23, 2007. On June 4, 2006, the United States Trade Representative stated in a press release that the U.S. has submitted a paper that proposes including zeroing in the ongoing Rules negotiations in the Doha Development Agenda. The U.S. is now urging WTO Members to resolve this issue in the WTO negotiations by adopting clear, precise rules permitting the use of zeroing in both investigations and administrative reviews.  It is expected that the U.S. proposal will be discussed in the Rules Group meetings in mid-June of 2007.

For more information on the WTO Panel Report and the U.S. response, click here.