TWN Info Service on WTO and Trade Issues (Sept09/04)
8 September 2009
Third World Network

US blocks panel request in Brazilian orange juice dispute
Published in SUNS #6765 dated 2 September 2009

Geneva, 1 Sep (Kanaga Raja) -- A request by Brazil for the establishment of a dispute panel over anti-dumping administrative reviews and other measures imposed by the United States in relation to imports of certain orange juice from Brazil was blocked by the United States at a meeting of the WTO Dispute Settlement Body on Monday.

This is a first-time request and panel establishment would be automatic when a second request by Brazil comes up before the DSB.

In its communication to the DSB, Brazil said that the measures at issue include the anti-dumping duty investigation on certain orange juice from Brazil (the Original Investigation).

Brazil said that this anti-dumping proceeding concerns the imposition of anti-dumping duties on certain orange juice for transport and/or further manufacturing produced in two different forms: (1) Frozen orange juice in a highly concentrated form, sometimes referred to as frozen concentrated orange juice for further manufacturing (FCOJM); and (2) pasteurized single-strength orange juice which has not been concentrated, referred to as Not-From-Concentrate (NFC) (case No A-351-840). The period of investigation is 1 October 2003 through 30 September 2004.

In this Original Investigation, said Brazil, the United States Department of Commerce ( USDOC) employed a methodology whereby it aggregated intermediate comparison results between weighted average normal value and weighted average export price for sub-groups of products within the product under investigation ("averaging groups"), treating as zero negative intermediate comparison results (i. e., situations in which the weighted average export price was greater than the weighted average normal value of an "averaging group"). Brazil referred to such methodology as "model zeroing" and/or US "zeroing procedures".

Another measure in the Brazilian complaint relates to the 2005-2007 anti-dumping duty administrative review on certain orange juice from Brazil (the First Administrative Review).

This anti-dumping proceeding concerns the administrative review of anti-dumping duties on certain orange juice from Brazil (case No A-351-840) for the period of 24 August 2005 through 28 February 2007.

According to the Brazilian communication, in this First Administrative Review, in order to assess the importers' final liability for payment of anti-dumping duties and the going-forward cash deposit rates, the USDOC employed a methodology whereby it aggregated intermediate comparison results between weighted average normal value for each "averaging group" with the transaction price of individual export transactions, treating as zero negative intermediate comparison results (i. e., situations in which the individual export price was greater than the weighted average normal value of an "averaging group"). Brazil referred to such methodology as "simple zeroing" and/or US "zeroing procedures".

Yet another measure relates to the 2007-2008 anti-dumping duty administrative review on certain orange juice from Brazil (Second Administrative Review). This anti-dumping proceeding concerns the administrative review of anti-dumping duties on certain orange juice from Brazil (case No A-351-840) for the period of 1 March 2007 through 29 February 2008.

Brazil said that in this Second Administrative Review, the USDOC applied again "simple zeroing" and/or US "zeroing procedures".

The measures at issue also include any assessment instructions issued by the USDOC and cash deposit requirements imposed pursuant to the measures listed above, as well as any measures taken by the United States Customs and Border Protection (USCBP) to collect definitive anti-dumping duties at the duty assessment rates established in those measures, including through the issuance of USCBP liquidations and notices.

The Brazilian communication also pointed to the continued use of the US "zeroing procedures" in successive anti-dumping proceedings, in relation to the anti-dumping duty order issued in respect of imports of certain orange juice from Brazil.

Brazil considered that the US measures are inconsistent with the provisions of the Anti-Dumping Agreement and the GATT 1994.

In its statement at the DSB, Brazil said that its request specifically challenges the use of "zeroing" when calculating the margin of dumping for exporters of orange juice from Brazil, a practice well-known to WTO Members given the number of times it has already been raised in this very forum.

Pointing to a long list of cases, Brazil said that the result of this intense litigation has been a consistent and coherent line of decisions, finding "zeroing" to be "as such" and "as applied", in original investigations or in reviews, in any of the three methods of comparison, inconsistent with the GATT 1994 and the Anti-Dumping Agreement.

Despite thousands of pages written on the subject and the sharp rebukes by the Appellate Body, the US refuses to abandon "zeroing". Except for a change in policy regarding the weighted-average-to-weighted-average comparison method in original investigations, the US has not yet changed its internal procedures and continues to apply "zeroing" in the calculation of dumping margins in other anti-dumping procedures, said Brazil.

The US said that it was disappointed that Brazil has chosen to move forward with the panel request. It expressed concern over the way in which Brazil has framed its panel request. For example, said the US, the request includes measures that were not in existence at the time of consultations and consequently could not have been, and were not, consulted upon.

In other actions, a panel was established at the request of Canada to rule on measures imposed by Korea affecting the importation of bovine meat and meat products from Canada.

Japan, the US, Brazil and Chinese Taipei reserved their third party rights in the dispute. +