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Conflicts Between U.S. Law and the World Trade Organization's Dispute Settlement Reports: Should the Court of International

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Conflicts Between U.S. Law and the World Trade Organization's Dispute Settlement Reports: Should the Court of International Conflicts Between U.S. Law and the World Trade Organization’s Dispute Settlement Reports: Should the Court of International Trade and the Federal Circuit Seek to Reconcile Their Decisions with the WTO’s Reports in the Antidumping and Countervailing Duty Area? By Neal J. Reynolds1 I. Introduction In April 1994, the Uruguay Round Agreements, which were designed to establish a more comprehensive regime governing international trade among member states, were adopted by the United States and more than one hundred other nations.2 As the text of the Agreements indicated, they were “reciprocal and mutually advantageous arrangements {that were} directed to the substantial reduction of tariffs and other barriers to trade and the elimination of discriminatory treatment in international trade relations.”3 Among its other important achievements, the Uruguay Round established the World Trade Organization (“WTO”), which was designed to be a “permanent forum for member governments to address issues affecting their multilateral trade relations as well as to supervise implementation of the trade agreements negotiated in the Uruguay Round.”4 One important component of the Uruguay Round negotiations was the adoption of two 1 Mr. Reynolds is the Assistant General Counsel for Litigation at the U.S. International Trade Commission. The views expressed in this paper are solely those of the author. The paper was not prepared by the Commission or on its behalf, and does not represent the official views of the Commission or any individual commissioner. 2 See generally Final Act Embodying the Uruguay Round of Multilateral Trade Negotiations, April 15, 1994. 3 Agreement Establishing the World Trade Organization, Chapeau, April 15, 1994. Additionally, the Agreements were intended to “develop an integrated, more viable and durable multilateral trading system” designed to “rais{e} standards of living, ensur{e} full employment and a large and steadily growing volume of real income and effective demand, and expand{} the production of and trade in goods and services...” Id. 4 Statement of Administrative Authority for the Uruguay Round Agreements Act (“SAA”), H. Doc. 103-316, Vol. 1, 103rd Cong., 2nd Sess. (1994) at 659; see also Agreement Establishing the World Trade Organization, April 15, 1994. 1 agreements addressing the issuance of antidumping and countervailing duty orders. Like the Uruguay Round Agreements themselves, these two agreements – the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (the “Antidumping Agreement”) and the Agreement on Subsidies and Countervailing Duty Measures (the “Subsidies Agreement”) were intended to establish a more comprehensive and transparent set of rules governing the manner in which WTO members conducted antidumping and countervailing duty investigations.5 From the United States’ point of view, the Antidumping and Subsidies Agreements were beneficial components of the Uruguay Round Agreements because they “preserve{d} the ability of U.S. industries to obtain relief from {unfairly traded} imports into the U.S. market” and “ensure{} U.S. exporters fair treatment in foreign antidumping {and countervailing duty} investigations.”6 Another important component of the Uruguay Round texts was the establishment of a dispute settlement mechanism under the Agreements.7 This mechanism was created in the Understanding on Rules and Procedures Governing the Settlement of Disputes (“DSU”). Among other things, the DSU authorized the establishment of dispute resolution panels to resolve disputes between WTO members arising under the Uruguay Round Agreements.8 It also created the WTO’s Appellate Body, which was given authority to act as an appellate review panel for decisions issued by these panels.9 According to the legislative history of the U.S. implementing legislation, the DSU process was intended to create a more effective resolution process for disputes between member states.10 Since the entry into force of the Agreements, the WTO has issued a significant and growing number of dispute resolution reports addressing the meaning, scope and implementation of the Uruguay Round Agreements, including the Antidumping and Subsidies Agreements.11 5 See generally Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (the “Antidumping Agreement”); Agreement on Subsidies and Countervailing Duty Measures (the “Subsidies Agreement”). 6 SAA at 807. 7 See generally World Trade Organization Understanding on Rules and Procedures Governing the Settlement of Disputes (“DSU”), Article 1 et seq. According to the SAA, the DSU provides the United States with a more “effective process to enforce U.S. rights” than existed under the General Agreement on Tariffs and Trade. SAA at 1008. 8 DSU, Articles 6, 7, 8, & 11. 9 DSU, Article 17. 10 SAA at 1008. 11 E.g., United States - Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan, AB-2001-2, WT/DS184/AB/R, July 24, 2001; European Communities - Anti- 2 Over the years, as the number of WTO reports in the antidumping and countervailing duty arena has grown, a number of commentators have addressed advisability of U.S. courts attempting to reconcile their decisions with decisions of WTO panels and the Appellate Body when reviewing the antidumping and countervailing duty determinations of the Commission and Commerce. Generally, commentators have expressed a range of views on this issue. Some commentators have suggested that, to the extent permitted under U.S. law, U.S. courts should reconcile their decisions with WTO decisions in order to ensure consistency of result between the two venues.12 Other commentators have suggested that WTO reports should be used as guidance to help resolve ambiguous issues under U.S. law.13 Other commentators have rejected both approaches, arguing that WTO reports should not be given any weight by U.S. courts in the area.14 This paper argues that there are sound statutory and policy reasons U.S. courts should not give weight to adverse WTO reports when reviewing the antidumping and countervailing determinations of the International Trade Commission and the Department of Commerce. II. Appellate Review of Commission and Commerce Determinations in the Antidumping and Countervailing Duty Area The U.S. Department of Commerce (“Commerce”) and the U.S. International Trade Commission (the “Commission”) are the agencies with primary responsibility for implementing the U.S. antidumping and countervailing duty laws.15 In antidumping and countervailing duty investigations and reviews, Commerce determines whether imports are being “dumped” (that is, sold at unfairly low prices) in the U.S. market, or whether they are being unfairly “subsidized” by Dumping Duties on Imports of Cotton-type Bed Linen from India (Recourse to Article 21.5 by India), AB-2003-1, WT/DS141/AB/RW (April 8, 2003); European Communities - Anti-Dumping Duties on Malleable Cast Iron Tube or Pipe Fittings from Brazil, AB-2003-2, WT/DS219/AB/R (July 22, 2003). 12 E.g., Judge Jane A. Restani and Professor Ira Bloom, Interpreting International Trade Statutes: Is the Charming Betsy Sinking?, 24 Fordham Int’l L. J. 1533 (2000-2001). 13 E.g., John M. Ryan, Interplay of WTO and U.S. Domestic Judicial Review: When the Same U.S. Administrative Determinations Are Appealed Under the WTO Agreements and Under U.S. Law, Do the Respective Decisions and Available Remedies Coexist or Collide?, 17 Tulane Journal of Int’l and Comparative Law 353 (Spring 2009). 14 E.g., Mary Jane Alves, Reflections on the Current States of Play: Have U.S. Courts Finally Decided to Stop Using International Agreements and Reports of International Trade Panels in International Trade Cases?, 17 Tulane J. Int’l & Comp. Law 299 (Spring 2009); Mark Barnett, The United States Court of International Trade In the Middle – International Tribunals: An Overview, 19 Tulane J. Int’l and Comp. Law 421 (Spring 2011). 15 E.g., 19 U.S.C. §1671 et seq.; 19 U.S.C. §1673 et seq. 3 the country in question.16 The Commission is responsible for determining whether imports of the product under investigation are causing, or are likely to cause, material injury to the U.S. industry producing the like product.17 In an original antidumping or countervailing duty investigation, the Commission determines whether the domestic industry is being materially injured, or threatened with material injury, by reason of the “dumped” or “subsidized” imports.18 In “sunset” reviews of existing antidumping or countervailing duty orders, the Commission determines whether revocation of an antidumping or countervailing duty order would be likely to lead to a continuation or recurrence of material injury to the domestic industry.19 In a typical year, the Commission and Commerce issue a number of appealable determinations. In the case of the Commission, the agency typically issues between twenty and forty appealable decisions in the antidumping or countervailing duty area.20 These decisions may be appealed in one of three venues. In the case of the Commission’s final determinations in original investigations and sunset reviews and its negative preliminary determinations in original investigations, the Commission’s determinations may be appealed to the U.S. Court of International Trade (“CIT”), whose decisions may then be appealed to the U.S. Court of Appeals for the Federal Circuit (“Federal Circuit”).21 If the Commission’s determination involves imports from Canada or Mexico, the determination may be appealed to a binational dispute resolution panel under the North American Free Trade Agreement (“NAFTA”).22 Finally, review of a 16 E.g., 19 U.S.C. §1671(a); 19 U.S.C. §1673. In five year reviews of antidumping or countervailing duty orders, Commerce determines whether dumping or subsidization of the subject imports is likely to continue or recur. 19 U.S.C. §1675(c). 17 19 U.S.C. §§1671d(b) & 1673d(b); 19 U.S.C. §§1675(c) & 1675a(a). 18 19 U.S.C. §§1671d(b) & 1673d(b). Under the statute, the Commission may also determine whether development of an industry is being materially retarded by reason of the subject imports, although these types of determinations are rare.
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