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DSB adopts “compliance” report in EU/China dispute over iron and steel

Today, the Dispute Settlement Body (DSB) adopted the Appellate Body report on compliance by the EU in its dispute with China over iron and steel products.

China noted that after almost seven years of WTO litigation, the most recent Appellate Body (AB) ruling left no doubt that the EU’s anti-dumping measures against Chinese imports of fasteners continued to violate the EU’s WTO obligations. Recalling the history of this dispute, China said it was pleased that the compliance panel had ruled in favour of many of its claims and that the AB had not only upheld all those findings but had also agreed with China’s cross-appeal and had reversed several of the panel’s findings that were in favour of the EU.

In China’s view, the compliance panel and the AB findings had fully vindicated China’s position and were a welcome reminder that, with the exception of the special rules governing the normal value determination that were due to expire on 11 December 2016, Chinese exporters should not be treated differently from exporters from other WTO members in EU anti-dumping investigations. China urged the EU to take all the necessary steps to ensure prompt and full compliance, starting with the immediate withdrawal of the anti-dumping duties on fasteners from China.

The EU noted that it had taken a number of measures to implement the DSB’s recommendations and rulings originally adopted in 2011 and that only some of those measures were disputed in the compliance proceedings whereby the panel and the AB found that certain aspects of the EU’s review were inconsistent with the Anti-Dumping Agreement. The EU welcomed the AB’s confirmation that where the analogue country methodology is used, the investigating authority is not required to adjust for differences in costs between the non-market economy producer and the analogue country producer where this would lead to adjusting back to the prices and costs in the non-market economy industry that were found to be distorted.

The next regular meeting of the DSB is scheduled for 26 February 2016.