United States-Final Anti-Dumping Measures on Stainless Steel from Mexico
Procedural History:
Appeal to Appellate Body of the World Trade Organization (WTO).
Overview:
Mexico (P) complained that the United States (D) violated Article VI of GATT 1994 and the Anti·Dumping Agreement by using incorrect methodology for calculation of margins of dumping. The panel that convened for the complaint did not follow the Appellate Body’s prior holdings, and instead relied on panel reports that the Appellate Body had reversed. Mexico (P) complained that the United States (D) violated Article VI of GATI 1994 and the Anti-Dumping Agreement by using incorrect methodology for calculation of margins of dumping. The Appellate Body of the WTO had addressed similar complaints filed against the United States (D) by the European Community and japan, but the panel that convened for Mexico’s (P) complaint did not follow the Appellate Body’s prior holdings, and instead relied on panel reports that the Appellate Body had reversed.
Issue:
In ruling on a dispute brought before a WTO panel, must the panel follow previously adopted Appellate Body reports addressing the same issues?
Rule:
in ruling on a suit brought before the WTO panel, the panel must follow previously adapted appellate body reports addressing the same issues
Analysis:
“Dumping” is the act of a manufacturer in one country exporting a product to another country at a price that is either below the price it charges in its home market or is below its cost of production. “Free market” advocates view “dumping” as beneficial for consumers and believe that actions to prevent it would have negative consequences. The use of “zeroing” in the context of calculating antidumping duties in domestic trade remedy proceedings has been one of the most contentious issues in World Trade Organization dispute settlement, and that in part explains the panel’s deviation from prior rulings by the Appellate Body in this case .
Outcome:
Yes. In ruling on a dispute brought before a WTO panel, the panel must follow previously adopted Appellate Body reports addressing the same issues. While Appellate Body reports are not binding, except with respect to resolving the particular dispute between the parties, subsequent panels are not free to disregard the legal interpretations and reasoning contained in previous Appellate Body reports that have been adopted. The Appellate Body functions to provide consistency and stability in interpretation of rights and obligations under covered agreements, and the panel’s failure to follow previously adopted Appellate Body reports undermines the development of a coherent and predictable body of jurisprudence. The panel’s erroneous legal interpretation is corrected, and its findings and conclusions that have been appealed are reversed. Whether the panel failed to discharge its duties under Article II of the Dispute Settlement Understanding is not ruled upon.
Procedural History:
Appeal to Appellate Body of the World Trade Organization (WTO).
Overview:
Mexico (P) complained that the United States (D) violated Article VI of GATT 1994 and the Anti·Dumping Agreement by using incorrect methodology for calculation of margins of dumping. The panel that convened for the complaint did not follow the Appellate Body’s prior holdings, and instead relied on panel reports that the Appellate Body had reversed. Mexico (P) complained that the United States (D) violated Article VI of GATI 1994 and the Anti-Dumping Agreement by using incorrect methodology for calculation of margins of dumping. The Appellate Body of the WTO had addressed similar complaints filed against the United States (D) by the European Community and japan, but the panel that convened for Mexico’s (P) complaint did not follow the Appellate Body’s prior holdings, and instead relied on panel reports that the Appellate Body had reversed.
Issue:
In ruling on a dispute brought before a WTO panel, must the panel follow previously adopted Appellate Body reports addressing the same issues?
Rule:
in ruling on a suit brought before the WTO panel, the panel must follow previously adapted appellate body reports addressing the same issues
Analysis:
“Dumping” is the act of a manufacturer in one country exporting a product to another country at a price that is either below the price it charges in its home market or is below its cost of production. “Free market” advocates view “dumping” as beneficial for consumers and believe that actions to prevent it would have negative consequences. The use of “zeroing” in the context of calculating antidumping duties in domestic trade remedy proceedings has been one of the most contentious issues in World Trade Organization dispute settlement, and that in part explains the panel’s deviation from prior rulings by the Appellate Body in this case .
Outcome:
Yes. In ruling on a dispute brought before a WTO panel, the panel must follow previously adopted Appellate Body reports addressing the same issues. While Appellate Body reports are not binding, except with respect to resolving the particular dispute between the parties, subsequent panels are not free to disregard the legal interpretations and reasoning contained in previous Appellate Body reports that have been adopted. The Appellate Body functions to provide consistency and stability in interpretation of rights and obligations under covered agreements, and the panel’s failure to follow previously adopted Appellate Body reports undermines the development of a coherent and predictable body of jurisprudence. The panel’s erroneous legal interpretation is corrected, and its findings and conclusions that have been appealed are reversed. Whether the panel failed to discharge its duties under Article II of the Dispute Settlement Understanding is not ruled upon.
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