INDIA SCORES MAJOR GAIN IN BED
LINEN CASE
India has scored
a major gain at the World Trade Organisation (WTO) in the dispute
with the European Communities (EC) on Bed Linen. In a just released
report, the Appellate Body of the WTO has concluded that EC
has failed to act consistently with provisions of Anti-Dumping
Agreement while implementing the rulings and recommendations of
the WTO’s Dispute Settlement Body (DSB) in an earlier dispute
with India regarding imposition of anti-dumping duty on bed linen
imports.
The recent finding
of the Appellate Body is linked with a previous dispute against
EC in which it had been held that EC had failed to comply with
requirements of the Anti-Dumping Agreement while imposing anti-dumping
duty on bed linen imports from India in November 1997. On 7 August
2001 the Council of the European Union adopted Regulation 1644/2001
amending the original definitive anti-dumping duties on bed linen
from India, purporting to comply with the DSB’s recommendations
and rulings in the original dispute, whilst simultaneously suspending
its application.
India strongly disagreed
that this re-determination complied with the rulings of the DSB.
In India’s view the re-determination, as amended, as well as the
further actions, failed to bring the EC into compliance with the
recommendations and rulings of the DSB in the original dispute
and was inconsistent with the WTO Covered Agreements. Accordingly
India sought the establishment of a Compliance Panel to examine
the existence or consistency of action taken by the EC to implement
the DSB decision in the dispute.
India argued that
the European Communities failed to determine the volume of dumped
imports attributable to non-examined producers on the basis
of "positive evidence" and an "objective examination". Although
the Indian producers that were examined individually and
found to be dumping accounted for only 47 percent of imports attributable
to all examined producers, the European Communities determined
that all imports attributable to non-examined producers
were dumped.
The Compliance Panel
concluded that EC had complied with the DSB decision in the original
dispute. India subsequently appealed certain issues of law and
legal interpretations developed by the Compliance Panel. While
reversing a new finding of the Compliance Panel, the Appellate
Body has now held that EC’s determination of volume of dumped
imports for purposes of making a determination of injury was not
based on an objective examination.
The Appellate
Body has now concluded that that the European Communities' determination
that all imports attributable to non-examined producers
were dumped—even though the evidence from examined producers
showed that producers accounting for 53 percent of imports attributed
to examined producers were not dumping—did not lead to
a result that was unbiased, even-handed, and
fair. Therefore, the European Communities
did not satisfy the requirements of paragraphs 1 and 2 of Article
3 to determine the volume of dumped imports on the basis of an
examination that is "objective".
The Appellate
Body has recommended that DSB request the European Communities
to bring its measure, found to be inconsistent with its obligations
under the Anti-Dumping Agreement, into conformity with
that Agreement.
In light of the
findings of the Appellate Body, India expects EC to revoke the
anti-dumping duty on Bed Linen and terminate the ongoing partial
interim review as well as the sunset review as these were based
on a measure that has been found to be inconsistent with the Anti-Dumping
Agreement.
