5000 TEU. This\ncontrasts with size bands previously referred to by Ko rea. As noted in the Response by the European\nCommunities to Panel Question 27 at the first substantive meeting, Korea itself refers to the market in\n“container vessels up to 1,999 TEU” and the “market in container vessels from 2,000 to 3,999 TEU”\nin para. 19 of Korea’s first written submission while then citing with approval to the vessel categories\nused in an analysis of FMI which looked at “cont ainer feeder vessels (up to about 3,500 TEU)” in\npara. 515 of Korea’s first written submission.\n\n The shifting size bands used by Korea and other industry analysts are evidence against\nKorea’s own argument that size bands can be used to sub-divide the product.\n\n173. (e) If they provide a range of pricing info rmation at different levels of aggregation,\nhow are these different data series used?\n\nKorea’s Comments\n\n The main level of aggregation is from a range of price series into a single newbuilding index.\nThis is usually done as a mathematical average (or price per dwt average) and not a weighted average\nreflecting the overall composition of the fleet. A single newbuilding index is a basic way of looking at\nwhat is happening overall to shipbuilding prices as opposed to sector or size band specific trends. So\nif a broad range of price series is used and pri ces are rising in some and dropping in others, the\nnewbuilding index trend will be m oderated by this. However, as the price indices do not cover all\nship types and because it is not weighted by the composition of the demand across different types and\nsizes, it has to be used with extreme caution and interpreted in the light of industry knowledge.\n\n Price series are not generally aggregated to pr ovide a single trend for a particular broad ship\ncategory because it is recognized that the differing tr ends between different size bands is a significant\nfactor. Whilst these trend differences may seem small in relation to overall market price movements,\nthey are highly significant to industry players because they demonstrate different underpinning factors\nfor different ship sizes. For example, there may be a particular shortage of smaller vessels affecting\nfreight rates and hence ordering trends for these vessels and not larger ones.\n\n Price series are therefore only indicators of wh at is happening for sample ship types which\nwill be chosen to reflect commonly used types or sizes of vessels. Where a range of sizes are given,\nthey are useful to see that trends can be varying differently within the same ship type. When only a\nsingle price trend is given for a particular type this generally means that this is the most popular size\nof vessel in use or that there is not a consistent e nough stream of data for another size to construct and\nmaintain a price series.\n\n Industry players are generally fully aware that price series data must always be used with\ncaution and care.\n\nEC Comment\n\n The discussion with respect of price indices is misleading. FMI produces a price index\ncovering a wide spectrum of ship types, and Clarks ons covers a wide spectrum of differing bulk ship\ntypes. The concept of weighting in this respect is incorrect and displays a lack of understanding of the\nmonitoring of the market. The aim of the price indices (none of which are weighted, including\nDrewry's when they publish it) is to monitor price l evels, not shipyard revenues. The use of weighting\nwould shift this to monitor ordering value, not price levels.\n\nANNEX G-3\n\nRESPONSES OF THE EUROPEAN COMMUNITIES TO\nSUPPLEMENTAL QUESTIONS FROM THE PANEL\n\n(16 July 2004)\n\nQuestion 187\n\n Please comment on Korea’s recalculations of benefit in Exhibits KOR-91-102\n\nResponse\n\n1. Please see EC reply to question 136 of the 2 July submission for extensive comments on\nKorean Exhibits 91-102.\n\nQuestion 188\n\n Concerning the question of whether the restru cturing of Daewoo was subsidized, please\nprovide a summary based on all of the submissions of Arthur Andersen/Anijn and PWC, of the\nEC’s analysis and conclusions in respect of whether DHI should have been liquidated instead of\nrestructured. In this summary, all relevant figures should be shown in tabular form, with cities\nand cross-references to the original Arthur Andersen report of November 1999 assessing the\nvalue of DHI under various scenarios.\n\nResponse\n\n2. Please see Section 3 of Exhibit EC-158 (PWC Report) for the information in tabular form\nwith references as requested.\n\nQuestion 189\n\n Concerning the Daewoo restructuring\n\n (a) Concerning the most recent PWC submission (Exhibit EC-145), please explain in\ndetail the statement at page 3 that the Anijn analysis indicated “that the\nEnterprise Value of the restructured company is lower than the Enterprise\nValue of the company computed without debt restructuring”.\n\n (b) What is “enterprise value” and how does it differ from “going concern value”?\n\n (c) What is the significance of the fact that the “enterprise value” was lower under\none set of calculations than under another? How if all does it affect the central\nissue raised by the EC, namely the deci sion to restructure instead of liquidate\nDaewoo?\n\n (d) What is the significance of Anijn’s reply in Exhibit KOR-70 that enterprise\nvalue was reduced under the analysis of the restructuring scenario from what it\nhad been under the valuation of the non-restructured company? What if\n\nanything is the significance that enterprise value calculations differed under two\nscenarios for the central issue posed by th e EC, namely whether it was better to\nliquidate or to restructure Daewoo?\n\nResponse\n\n3. Please see Section 4 of Exhibit EC-158 (PWC Repor t) for a reply to sub-questions (a) to (d).\n\n4. As explained in that section, the enterpri se value of a company having too much financial\ndebt is lower than the enterprise value of a comp any that generates the same cash flows but which\nbears a reasonable amount of debt. As a result, one would expect that the enterprise value of a\ncompany having undergone financial restructuring is higher than the enterprise value of the same\ncompany before its restructuring. This wa s not the case in the analysis performed by\nArthur Andersen.\n\n5. Consequently, either the pre-restructuring en terprise value of DHI was over-estimated or the\npost-restructuring enterprise value was underestimated . To come up with a post-restructuring value\nthat is higher than the pre-restructuring value, Arthur Andersen suddenly took into account factors\nexcluded from their analysis up to that stage (asset s recoverable from DHI). Considering that these\nelements were suddenly introduced without any explanation and based on estimates without any\nsupporting evidence, under normal circumstances, cr editors would certainly have demanded more\ninformation on that aspect.\n\n6. The above is simply an additional question raised by the AA report, which along with all\nother open questions (EBIT margin, lack of analys is of tax consequences of the restructuring,\nenterprise value being lower after restructuring, investment level for the residual value, etc.)\ndemonstrates that no prudent creditor would have taken such an important decision on restructuring\non the basis of such a question-ridden report. To the contrary, prudent creditors would not have\nagreed to any solution other than liquidation without requiring much more in-depth analysis.\n\n7. It is now clear that the Arthur Andersen Repor t could at best be considered as a very first and\nrudimentary analysis of the DHI situation at the time, on the basis of which no prudent creditor would\nhave acted. Under normal circumstances, prudent cr editors would have required a lot more in-depth\ninformation and would have questioned a number of elements and assertions of the Report. Please see\nSection 5 of Exhibit EC-158 (PWC report) for further comments regarding the EBIT margin (page 10\nof Exhibit Korea-141) and the recovery value of DHI (pages 7 and 8 of Exhibit Korea-141) used in\nthe Arthur Andersen report.\n\n8. Moreover, the European Communities would like to point out a major new fact presented by\nKorea in Exhibit Korea-141 (pages 5, 8, and 9). In particular, Korea has stated that the liquidation\nvalue of DHI was [BCI: Omitted from public version] as opposed to the figure of [BCI: Omitted\nfrom public version] used previously in the Arthur Ander sen Report. It seems, therefore, that a\ndifferent liquidation value is used depending on th e desired outcome. This new higher liquidation\nvalue would make it clearer that DHI ought to have b een liquidated. See Section 3 of Exhibit EC-158\n(PWC report).\n\nQuestion 190\n\n The data presented in Exhibit KOR-108 show interest and depreciation expense in the\ncost/profitability analysis for Daewoo. Please comment. How can this be reconciled with the\nEC’s assertion that these costs have not been adequately reflected in Daewoo’s prices?\n\nResponse\n\n9. The European Communities notes that the KPMG analysis of production costs for three LNG\ncarriers (Exhibit Korea-108) is based on DSME figu res and not on audited facts. Thus, it is not\nindependent. KPMG confirms only that the figures presented correspond with the figures held in the\nDaewoo cost accounting system. The inclusion of costs has not been audited, as indicated in the letter\naccompanying this exhibit, and no opinion has been given by KPMG as to whether all costs are\nincluded.\n\n10. We also note that the ship prices given by KPMG in chapter 2.5.2 [BCI: Omitted from\npublic version]. The summary of cost analysis on page 3 gives yet another set of figures: dividing\nthe indicated sales prices in Won by the indicated sales prices in USD (on page 2) yields exchange\nrates of [BCI: Omitted from public version] . None of these exchange rates corresponds to the\nexchange rates allegedly applied by KPMG as indicated on page 7. If KPMG is not even clear on this\nbasic parameter, one must wonder about the rest of the assessment.\n\n11. For the Bergesen LNG carrier th e price difference is significant [BCI: Omitted from public\nversion].\n\n12. KPMG undertakes to compare cost estimates ma de by FMI at the time of contracting the\nvessel with real costs incurred. In the case of th e Bergesen LNG carrier the cost estimate by FMI was\nmade in July 2000 (2 months after the conclusion of the contract), including (mostly) figures provided\nby Daewoo during the bilateral discussions with the European Communities. At this time, DHI\ncontinued to have a significant amount of debt, and FMI calculated the debt service accordingly as the\nshipyard should have done when preparing its bid (unless the shipyard knew already in July 2000 that\nits debts would be forgiven in December 2000). It is not conceivable that DHI could have arrived at\nthe offer price of [BCI: Omitted from public version] if it had taken into account the actual debt\nsituation at the time.\n\n13. It should also be noted that DHI could not have known in 2000 how many LNG carriers it\nwould contract in the mid-term, and how the depreciation of LNG related investment costs would thus\nbe allocated per vessel. FMI had to base its analys is on the actual order situation (as any reasonable\nshipyard estimator would have done) and not on some speculative market pros pect. Again, it is not\nconceivable that DHI could have arrived at the offe r price if it had taken into account the very limited\nnumber of confirmed orders for LNG carriers at the time.\n\n14. There remains a difference primarily relating to costs of development of both the product and\nthe processes to build the product. FMI’s model in cludes an assessment of what they believe these\ncosts may be, based on the known costs of others entering this sector. It is likely that Daewoo would\nwant to contest these costs in terms of their magnitu de, but it is difficult to understand the claim that\nthe costs do not exist at all. If they do not exist, they must ha ve been written off at some point\nbecause it is not possible to enter this market, le t alone become the global market leader, without\nincurring significant expense.\n\n15. Further information to back up this point of view is given below, by reviewing the\ncontribution to overhead indicated for the three ship s analysed in Exhibit Korea-108 against the total\nworkload of the business and the total depreciation cost.\n\n16. Table 1 presents information taken from DS ME’s audited accounts published on the web site\nwww.DSME.co.kr, showing depreciation in million W on. For the purposes of comparison, the table\nalso shows the value of depreciation for the sh ipbuilding portion of DHI in 1999, prior to the\nbankruptcy and restructuring of the company, using information from DHI’s published audited\naccounts for that year.\n\nYear Depreciation\n(million Won)\n1999 (DHI)1 115,116\n2000 20,636\n2001 80,027\n2002 85,563\n2003 101,148\n\nTable 1 – Depreciation at DSME (and DHI shipbuilding operations for 1999)\n\n17. It can immediately be seen that the deprecia tion carried by shipbuilding operations at DSME\nis considerably lower than that carried by the shipbuilding operations of DHI. The difference is even\nmore marked when it is noted that the DHI figur e for 1999 includes only depreciation attributed to\nshipbuilding operations while the DSME figures cover shipbuilding and other operations. The\nproportion of sales attributed to shipbuilding (excluding offshore and other business) and the\nproportion attributed to LNG tankers alone are pres ented in Table 2, using information from DSME’s\npublished accounts.\n\nYear\nProportion of sales\nattributable to\nshipbuilding\nProportion of sales\nattributable to LNG\ntankers alone\n2001 75% 15%\n2002 84% 30%\n2003 70% 32%\n\nTable 2 – Proportion of sales at DSME attributable to pure shipbuilding operations\n\n18. Table 3 below presents data from Exhib it Korea-108 indicating the amount of overhead\nrecovered from each of the three contracts evaluate d. This has been proportioned over the work\ncontent of the ship according to its CGT value noted in Lloyd’s Register. This gives the amount of\noverhead recovered per unit of work on these ships, which can be compared to the values per unit of\nwork in the shipyard as a whole. [BCI: Omitted from public version.]\n\n19. For comparison, Table 4 summarises the average cost of depreciation per unit of work in the\nshipyard as a whole. The assumptions made in this table are that the total depreciation cost is\ndistributed across the company accord ing to sales value and that this is evenly distributed across the\noutput of the shipyard – i.e. with an average cost of depreciation for each unit of work (CGT)\nproduced.\n\n [BCI: Omitted from public version.]\n\n20. This allocation of depreciati on to shipbuilding through sales is a little simplistic, as some of\nthe offshore business will involv e shipbuilding operations. 2 In the absence of detailed audited\naccounting information, however, these percentages ar e used in the following analysis with the note\nthat the results will err on the side of caution.\n\n21. Comparison of the right hand column of Ta ble 4 with the right hand column of Table 3\nindicates how the actual contribution per unit of work from the three LNG tankers discussed in\n\n1 Depreciation allocated to shipbuilding only.\n2 E.g., the fabrication of hulls for offshore storage and processing vessels.\n\nExhibit Korea-108 compares to the average. On average, the contribution from LNG tankers to\ndepreciation is around the average level per unit of work for the shipyard as a whole over the period\nshown.\n\n22. These results are hard to understand, given th at LNG tankers would be expected to contribute\ngreater than the average level to depreciation given the cost of product and facilities developments for\nthis very complex type of ship. The development of the capability to build LNG tankers is a lengthy\nbusiness. The extreme potential hazard represente d by these ships, which carry around 75,000 tonnes\nof liquid methane at around -160\noC, requires a high level of certification and approval, including a\nlicense to build from the developers of the cargo containment systems. This requires the development\nof the design of the ship, development and appr oval of special production procedures, training of\npersonnel, and development of specialised facilities and equipment. The specialised facilities include\nsupport structures for the tanks, in particular special staging for construction inside the tanks, facilities\nfor production of insulation boxes, robotic welding machinery and robotic machinery for the\napplication of separating materials, facilities for clean working, facilities for atmospheric control, etc.\n\n23. KPMG points out on page 13 of Exhibit Korea- 108 that “FMI failed to explain why the cost\nmodel of European shipyards applicable to these ‘other direct costs’ should apply to Korean shipyards\nthat are generally known to be the most efficient ya rds in the world.” This is misleading, however,\nbecause efficiency does not relieve the shipyard of costs associated with capital expenditure to gain\nthe capability to build this ship type, and the effi ciency of the building process does nothing to lower\nthe investment cost. Pursuit of efficiency may actua lly raise this cost as was the case, for example,\nwhen DSME in 2002 constructed a new outfitting pier for LNG tanker construction to improve\nworkflow in the shipyard (reported cost 40 Mio USD).\n\n24. FMI’s estimates were based on a cost estimate made for a series of LNG tankers by a\nEuropean shipyard. This includes a cost of 15.5 Mio USD per ship for capital investment directly\nrelated to the ships’ construction. It does not include provision for the training and market entry costs\ndiscussed above. As discussed above, it would be e xpected that DSME may argue that this provision\nis too high. During the bilateral discussions in 2000, however, it was claimed that these costs do not\nexist at all, a view also put forward by KPMG in Exhibit Korea-108. The potential argument that\ngreater throughput means that costs are depreciated over a greater number of ships is limited, because\nmore investment has to be made to enable this greater throughput to be accommodated.\n\n25. Finally, profit margins of [BCI: Omitted from public version] are virtually unheard of in\nshipbuilding as any analyst will confirm. It is not r ealistic to think that DHI could have offered, for\nexample, the Exmar LNG carrier (hull number 2213) at a price of [BCI: Omitted from public\nversion] and still broken even.\n\nQuestion 191\n\n Exhibit KOR-107 sets forth the results of the court-ordered/supervised restructuring of\nDaedong. Presumably, such a restructuring had to proceed in accordance with Korean\nbankruptcy law. On what basis does the EC allege that nevertheless it involved a subsidy?\n\nResponse\n\n26. As the European Communities stat ed in its response to Question 23:\n\nThe EC fully accepts that bankruptcy law is a necessary part of a market economy\nand that a properly conducte d bankruptcy proceeding would normally not give rise to\na subsidy. However, where the outcome of a bankruptcy proceeding or a corporate\nrestructuring is determined by public bodies – or private bodies acting under their\ndirection – and leads to a more beneficial outcome for the enterprise than would have\n\narisen if the creditors had acted according to market principles, all of the components\nof a subsidy are present. There is no basis in the SCM Agreement to allow insolvency\nto be a loophole in the subsidy disciplines.3\n27. Moreover, the fact that a restructuring pr oceeded in accordance with Korean bankruptcy law\nsays nothing about whether creditors or investors did or did not provide a subsidy. The terms of the\nrestructuring, such as the amount of debt to be forgiv en, are decisions that can lead to a benefit for the\nrecipient if they are more favourable than what would be obtained on the market even within a\nbankruptcy proceeding.\n\nQuestion 192\n\n One conclusion that might be drawn from Exhibits KOR-91-102 is that Korea accepts\nthat there is a benefit from the KEXIM financing at issue, but that the benefit in a number of\ncases is quite small (0.5 per cent or less). If on e accepts that the benefit is of the magnitude\nreflected in these Korean exhibits, what woul d be the implications for the EC’s serious\nprejudice analysis and conclusions?\n\nResponse\n\n28. First, it is important to note that even a sm all percentage of the value of a multi-million dollar\nvessel provides a considerable and significant benefit. Moreover, the ability of Korean shipyards to\nmake use of the benefits from KEXIM financing, whether in the form of pre-shipment loans or\nAPRGs, can often be the deciding factor in thei r ability to offer a lower price than competing\nshipyards or to otherwise provide the most attractive contract terms for the buyer. Thus, even in those\ninstances where KEXIM subsidies constitute a relativel y small benefit in terms of percentage, they\nsignificantly strengthen the ability of KEXIM-subsidised shipyards to maintain their capacity (and the\nlow prices in the market) when they would otherwise exit the market or reduce capacity.\n\nQuestion 193\n\n Exhibit KOR-112, concerning MOCIE’s interv ention at the request of Samsung, could\nbe viewed as indicating that the government takes action if prices are too low\n. If this is the case,\nwhat are the implications for the EC’s serious prejudice claim?\n\nResponse\n\n29. As MOCIE does not take actions against low prices b ased on the standards of “significant\nprice suppression” or “significant price depression” within the meaning of Part III of the SCM\nAgreement, MOCIE’s actions do not have any implicati ons for the EC’s serious prejudice claim.\nMoreover, there is certainly no indication that MO CIE takes actions in a systematic way for every\nsituation in which it considers that prices are too low.\n\nQuestion 194\n\n If the Panel were to accept the product subdivisions set forth in Exhibit KOR-109, how\nwould this affect the EC’s analysis of price suppression/depression? Please respond in detail.\n\n3 Responses to Questions from the Panel following the First Substantive Meeting by the\n\nResponse\n\n30. Drewry, in Exhibit Korea-109, argues that sh ip size needs to be taken into account when\ncomparing price developments. Of course, no one w ould argue that a larger ship does not cost more\nthan a smaller ship. However, the analysis pr esented in Exhibit Korea-109 inevitably leads to a\nskewed result because it analyses price against cargo carrying capacity (TEU and dwt) and not against\nwork content. The price analysis should, correctly, be undertaken on the basis of CGT because that is\nthe unit that measures work content and its relationshi p to capacity in shipbuilding. The analysis is\nintended to look at the situation with respect to the shipbuilding industry, not the shipping industry,\nand the appropriate denominator must therefore be used.\n\n31. The weighting of prices according to product mix in the graph on page 4 is particularly\nmisleading. The use of weighting factors in this s ituation is incorrect because the analysis is intended\nto reveal trends in ship prices and not the value of the orderbook. The use of weighting in a ship price\nindex demonstrates a lack of understanding of the economics of shipbuilding prices.\n\n32. The remainder of Exhibit Korea-109 primar ily repeats previous arguments regarding\ndifferences between and within ship types. Its rele vance is questionable. This portion culminates in\nsection III starting on page 13, with misleading asser tions about the non-substitutability of shipyard\ncapacity. Complex passenger vessels (“cruise ferries”) have recently been built in both South Korea\n(by Hyundai, Samsung, and Daewoo) and China. Th e breadth of shipbuilding orderbooks in South\nKorea (as can be seen from the Cl arkson Monitor, Exhibit EC-152) gives ample demonstration of the\nbroad potential for substitution, w ith passenger ships, offshore vessels, container ships, tankers, LNG\ncarriers, etc., all proceeding through the same facilities.\n\n33. As ships are made-to-order products, certa in differences between individual vessels can\nalways be found. Taking this specific feature of the shipbuilding industry to the limit would make it\nimpossible to undertake a price suppression/depression analysis, as product markets would contain\nonly a handful of vessels or even just one ship. Korea is obviously attempting to avoid the SCM\ndisciplines by creating an unlimited number of cate gories of products. As the European Communities\nhas set out in its oral statement of 17 June (paragraphs 66-67), such an approach cannot be correct.\n\n34. Exhibit Korea-109 makes little reference to price depression and suppression apart from\ntrying to suggest that it does not exist because li ke products are too difficult to identify. The\nEuropean Communities stands by the model of price suppression and depression and the mechanisms\npreviously explained, at the broad product level. Detailed explanation of the mechanisms can be\nfound in attachment 2 (“Estimation of price suppr ession and depression prepared by FMI”) to the\nEC’s responses to questions from the Panel following the first substantive meeting. Clearly, it follows\nfrom this that if the mechanism is active at the br oad product level it is also active at any sub-category\nlevel. This is amply demonstrated by the gra ph on page 5 of Exhibit EC -146 (FMI June 2004 report,\n“Technical Support to the WTO Hearings”), which shows prices of sub-classes of ships moving\nbroadly in unison.\n\n35. Consequently, the European Communities do es not see the subdivisions put forward in\nExhibit Korea-109 affecting the price suppression/depression analysis. More detailed analyses would\nreveal the same mechanisms and would give the same result.\n\n36. In fact, if the Korean analysis of sub-t ypes were to be accepted, the mechanism whereby\ndominating capacity has a suppressive effect on the market is more clearly seen. The European\nCommunities has argued that price suppression is le d by intense competition between concentrations\nof capacity in a limited number of very large shipya rds. In the handymax products tanker sector, for\nexample, South Korean shipyards have a share of the orderbook of 53.3 pe r cent, shared between\nthree shipyards: STX, Hyundai Mipo, and Shin A. The top four shipyards, including Shin Kurishima\nin Japan, control about two-thirds of the market . In the panamax products tanker sector, South\n\nKorean shipyards account for 63.7 per cent of the orderbook, spread between four shipyards: Hyundai\nHeavy, STX, Samsung, and Daewoo. In the LNG tanker sector, Daewoo and Samsung together\naccount for 47 per cent of all orders. In the pana max container sector, Hyundai, Hanjin, and Samho\ntogether account for 70 per cent of all orders, and in the post-panamax sector, Hyundai Heavy,\nSamsung, and Daewoo account for two-thirds of all or ders. The disputed shipyards regularly appear\namong the small concentrations of shipyards whose capacity is leading prices.\n\nQuestion 195\n\n Please comment on Exhibit KOR-115.\n\nResponse\n\n37. Regarding Exhibit Korea-115, a table co mpiled from a 19-page August 2003 FMI report on\nkey price movements (originally submitted as Annex 5a-2, submitted by Korea as Exhibit Korea-142),\nthe European Communities first notes that Korea finds it useful to monitor new shipbuilding prices in\nUSD/CGT.\n\n38. Korea referred to this exhibit in its oral statement of 17 June 2004 in paragraph 293,\nindicating that Korean offer prices were not alwa ys the lowest for a number of ship types. The\nindicated price levels are the average of reported c ontract prices for the ship types in question for a\nseven-year period (1997-2003), adjusted by CGT. These averages are a very minor part of the FMI\nreport and are meaningless without the time series gr aphs that accompany them. The graphs showing\nthe relative movement in prices over time betwee n the different nationalities are of particular\nimportance, and this analysis in no way supports the contentions made in paragraph 293 of the Korean\noral statement. The Korean presentation overs implifies the price setting mechanism in the\nshipbuilding market. Price competition is based on shipyards’ bids for individual shipbuilding\ncontracts, not on long-term averages for a large group of shipyards in a specific shipbuilding region.\nLong-term averages are only meaningful for a trend analysis, which was the purpose of the\nAugust 2003 FMI report. Additional quotes from the report can help to make the situation more\ntransparent and provide the trend information that is missing from Exhibit Korea-115:\n\nFrom the conclusions\n\nIn all cases a significant fall in prices can be seen in South Korea in 1998. As a\ngeneral comment, other builders followed suit with price reductions but at a slower\nrate than was seen in South Korea.\nPrice leadership in the product/chemical tanke r sector is varied. China appears to be\nthe price leader for panamax tankers and S outh Korea for the smaller ship types.\nCroatian shipyards had a significant presence in the handymax sector although with\nprices generally higher than those offered in the Far East. Chemical tanker prices\nhave been led by China since 2001.\nIn the feeder container sector, prices appear to have been led in recent years by South\nKorea and China but with strong competition from Poland, Singapore and Taiwan. In\nthe panamax and post panamax container ship sectors, South Korea has a strong lead.\nIn the post panamax sector, China and Japan appear to have been trying to undercut\nSouth Korean prices to increase market share although with only limited success.\nConcerning handysize products tankers\n\nCompetition is predominantly between Chin a and South Korea, with South Korea\ndominating.\n\nSouth Korea reduced prices for this class of ship significantly in 1998 from a level of\naround $1,500 to $1,600 per CGT to a level of around $1 ,200. Prices in general have\nrisen since then. Prices in China fell more slowly than in South Korea and have been\ncompetitive with South Korean prices since 2001.\nConcerning handymax products tankers\n\nOrders in this sector are competed by S outh Korea, Japan and China, with South\nKorea dominating.\nAs with handysize products tankers, South Korea appears to have been the price\nleader in this sector with prices falling over 1998 from a level of around $1,400 per\nCGT to around $1,100. Prices from other countries also showed a declining trend but\nless sharp than in South Korea and without falling to such a low point. Since 2001\nprices have been competed at around $1,200 to $1,400 per CGT. Since the start of\n2000, prices from Croatian shipyards have b een generally higher than those from Far\nEast shipyards.\nConcerning panamax products tankers\n\nThe market for panamax products tankers was quiet in the period up to 2001 and\nincreased after that time. The market is co mpeted by China, Japan and South Korea,\nwith South Korea being the market leader in recent years.\nChina has remained the price leader in th is sector over the period examined, with\nprices falling over the past three years from around the $1,350 per CGT level to\naround $1,200. South Korea reduced pri ces in 2001 and 2002 and market share\ncorrespondingly increased, taking share from Chin ese builders. Japan also saw a fall\nin prices in 2001, in competition with China and South Korea.\nConcerning chemical tankers\n\nThe analysis of chemical tankers is made difficult by variations in specification. Not\nall records in the data set indicate the IMO classification of the ship. The majority of\nships where the IMO class is indicated are either class II or class II/III. A small\nnumber were indicated as class I/II, with a correspondingly higher price. Class I/II\nships were indicated only in Poland and the EU, although this does not mean to say\nthat none of the ships from other countries wher e no class is indicat ed are cla ss I/II.\nEven where class is indicated, there is no cl ear trend in price between classes in the\nsame country. It has not therefore been possible to subdivide the data set any further\non this basis.\nJapan, South Korea and China have offered the lowest prices and in the past two\nyears China appears to have been the pr ice leader. Prices from EU shipyards are\ngenerally significantly higher than those fro m the Far East. It is not possible to say\nhow much of this higher price is due to differences in specification.\nConcerning container feeder vessels\n\nThe market has been competed primarily by China, EU, South Korea and Other\ncountries. “Other” refers in particular to Singapore, Taiwan and Poland.\nThe pricing situation in this sector is complex and difficult to summarise.\nSouth Korea reduced prices over 1997 a nd 1998 from around $1,700 per CGT to\n\naround $1,300. Competitors in other countries followed suit but were unable to\nmatch the price level achieved in South Korea. When South Korean prices increased\nin late 1999 and 2000, relative competitiv eness returned to China, EU and other\ncountries. Subsequent significant falls in price in South Korea and other countries in\n2001, to below $1,200 per CGT, were not matched by Chinese and EU builders. EU\nshipyards have been losing ground through increasing prices since 2001.\nConcerning panamax container vessels\n\nSouth Korea has dominated the market w ith intermittent orde rs taken by Other\ncountries. “Other” in this table refers to Taiwan and Poland.\nPrices from South Korean shipyards fell in 1998 from around $1,500 per CGT to\naround $1,300. Prices increased again in 2000 but have fallen fairly steadily since\nthat time, remaining at around the $1,300 per CGT level in 2002 and 2003. There has\nbeen limited competition from elsewhere over this period with other countries\napparently struggling to compete with the price level set by South Korean\nshipbuilders.\nConcerning post-panamax container vessels\n\nAs with panamax ships, the market is dominated by South Korea.\nBoth China and Japan appear to have been offering prices to undercut South Korea in\na bid to gain market share, although with only limited success.\n\nLIST OF EXHIBITS\n\nExhibit EC-158 Report by PriceWaterhouseCoopers, July 2004\n\nNote: Exhibits in bold contain BCI.\n\nANNEX G-4\n\nRESPONSES AND COMMENTS OF KOREA TO QUESTIONS\nFROM THE EUROPEAN COMMUNITIES AND\nFROM THE PANEL\n\n(2 July 2004)\n\nRESPONSES OF KOREA TO QUESTIONS ADDRESSED BY THE EUROPEAN COMMUNITIES\nTO KOREA FOLLOWING THE SECOND MEETING OF THE PANEL\n\n1. Question\nIn paragraph 69 of its Oral Statement, Korea states that government funds constitute less\nthan 3 per cent of the total requirement funds.\n(a) Please explain what this means. Is it not true that KEXIM has received capital\ninjections every year since 1997-2001?\n\nResponse\n\n The “less than 3 per cent” in the Oral Stat ement represents the ratio of the outstanding\nborrowings from the Government of Korea to the total outstanding borrowings of KEXIM in 2002.\nMore specifically, the KEXIM borrowing from the Government at the end of 2002 was [BCI:\nOmitted from public version] of the total borrowing. The ratios of borrowings from the\nGovernment of Korea have continuously decreased as shown in the table below. [BCI: Omitted\nfrom public version.]\n\n This is distinct from the question of paid-in capital. The EC is mixing apples and oranges.\n\n (b) Please explain the statement in Moody’s opinion of August 2002 (Exhibit EC-\n120):\n\n KEXIM A3 senior debt rating and Prime-2-short-term rating reflect its\ngovernment ownership, and the governments’ responsibility under the KEXIM\nact to cover the bank’s annual losses beyond its reserves\n\n Wholly owned by the Korean government , KEXIM issued debt shares the same\nA3 investment grade rating as a government bond\n\nResponse\n\n Korea will not speculate on Moody’s opinion. The EC could have solicited a further\nexplanation from Moody’s in a timely fashion had it so wished. As Korea has stated, KEXIM does not\nborrow with a sovereign guarantee.\n\n Why would KEXIM need to borrow from the state under these conditions?\n\nResponse\n\n KEXIM borrows funds because it is a financia l institution independent of the Government.\nArticle 19 of the KEXIM Act specifically allows KEXIM to borrow such funds from Korean and\nforeign governments, international financial organizations as well as commercial financial\ninstitutions. As with any financial institution, KEXIM borrows from a variety of sources.\n\n (c) Please comment on page 14 of the KEXIM brochure (Exhibit EC – 97)\nindicating that the government was KEXI M's main funding source in the period\n1998-2000 (42.1 per cent in 1998, 45.6 per cent in 1999 and 47.1 per cent in\n2000). How does this tie in with the statement made in paragraph 69 of the oral\nstatement that the government funds constitute less than 3 per cent?\n\nResponse\n\n The percentages indicated in the KEXIM br ochure represent the ratios of borrowings from\npublic sectors to the total KEXIM borrowings in th e respective years. The public sectors include the\nGovernment of Korea and international financia l organizations such as the IBRD. For example,\n47.1 per cent in 2000 means the percentage of the borrowings from [BCI: Omitted from public\nversion] to the total KEXIM borrowings.\n\n (d) Please explain the statement on page 3 of the KEXIM brochure that \"the\nGovernment shall provide funds to cover any net loss beyond the Banks' reserve\nwhich implies pre-emptive and sufficient support\"\n\nResponse\n\n The statement is simply reiterating Article 37 of the KEXIM Act which requires the\nGovernment of Korea to cover net loss beyond reserv es as the major shareholder. This is merely an\nindication that it is unlikely that KEXIM would go into bankruptcy. This is a characteristic of all\ngovernment-owned corporations, whet her financial or otherwise, in all Member states. However,\nKEXIM has never incurred any losses since its establishment.\n\n (e) Please explain the statement (page 4) that the \"continuous capital injections [by\nthe government] reaffirm KEXIM to be a valid sovereign entity\".\n\nResponse\n\n Again, this is describing the participations by the Government of Korea in the capital\nincreases of KEXIM. KEXIM increased its capital in 1998, 1999 and 2000 to meet BIS requirements.\nAs to the details of KEXIM capital increases, pl ease refer to Korea Response 1.1(11) to Annex V\nQuestions. There is no disagreement that KEXIM is government-owned.\n\n2. Question\n\n In paragraph 106 of its Oral Statement Ko rea states that Korean domestic banks’\nreturns on equity (ROE) were negative 17.2 per cent during this critical period. Please confirm\nthat the critical period referred to is 1997-2001 and that Korea has not included the KDB and\nIBK in that calculation?\n\nResponse\n\n As clarified by Korea during the Second Subs tantive Meeting, the period concerned is 1997-\n2001 and the ROE does not include KDB and IBK.\n\n3. Question\n\n Korea is correct that one of the key elements in the dispute is the relationship between\nthe Korea and the IMF and the degree to whic h bailout funds may be shielded from SCM\ndisciplines. Could Korea please explain why the Letter of Intent between Korea and the IMF\ncontained the following statement:\nIn order to enhance the incentives for banks to participate fully in the corporate\nrestructuring process, no public funds, whether by way of KAMCO (NPA Fund)\npurchases or capital injections or other me ans, shall be made available to banks\nwhich are not certified by the FSC to be performing their role in the corporate\nsector restructuring process.\n1\n Why was this statement repeated in all subsequent Letters of Intent to the IMF until\nJuly 2000?2\n\nResponse\n\n The above statement in the LOI was incorporated into the LOI at the initiative of the IMF. As\na matter of fact, the provisions of the LOIs require d the Government of Korea to do, or refrain from\ndoing, something that had been proposed by the IMF. As the borrower under the IMF stand-by\narrangement, Korea had to accept the proposals of the IMF in most cases.\n\n What the IMF was aiming at with the above-quoted LOI provision was to restore the\nsoundness of the Korean financial sector. In order to achieve this objective, the IMF thought that\nbanks should provide some impetus for corporate restructuring as it was essential to reduce their\nexposure to corporations ( See Exhibit Korea - 2, Carl-Johan Lindgren et al, Financial Sector Crisis\nand Restructuring – Lessons from Asia (IMF Occasional Paper 188, 1999), p. 76).\n\n The LOI statement quoted above refers to banks “performing their role in the corporate sector\nrestructuring processes.” This is a very general statement. In fact, the “corporate sector restructuring”,\nas used in the LOIs, was a generic term that covers a variety of objectives, including, without\nlimitation, reducing cross guarantees, improving cor porate governance, strengthening the role of the\nFair Trade Commission to enforce antitrust laws, and strengthening the legal framework for creditors’\nrights by improving the insolvency system.\n3 Furthermore, as demonstrated by these LOIs, the specific\ncontents and focus of the corporate sector restructuring have continuously changed.\n\n Despite all of these ambiguities, however, the LOIs laid down certain rules for the Korean\nGovernment and banks to abide by in connection with such corporate sector restructuring. First, “ [t]o\nstrengthen market discipline, bankruptcy provisions according to Korean law will be allowed to\n\n1 Korea Letter of Intent and Memorandum of Economic Policies, 13 November 1998, (Exhibit EC-36)\nand Annex to Korea Letter of Intent and Memorandum of Economic Policies, 13 November 1998, p. 7 (Exhibit\nEC-117).\n2 See for example : Korea Letter of Intent and Memorandum of Economic Policies, 24 November 1999,\nat 6 ; Korea Letter of Intent and Memorandum of Economic Policies for 2000, 12 July 2000, at 7 (Exhibit EC-\n36).\n3 See Exhibit EC - 34, e.g., 24 July 1998 LOI (World Bank SAL II, Policy Matrix on Corporate\nRestructuring), 10 March 1999 LOI (Corporate Restructuring part), 24 November 1999 LOI (World Bank\nCFSRL – Policy Matrix II. Corporate Sector Reform).\n\noperate without government interfer ence. No government subsidized support or tax privileges will be\nprovided to bail out individual corporations” (Exhibit EC-36, 3 December 1997 LOI, para. 35).\n\n Second, “ [a]ll corporate restructuring should be voluntary (i.e. not government directed) and\nmarket oriented; and public funds will not be used to bail out corporations ” (Exhibit EC - 36, 2 May\n1998 LOI, section on “Corporate Governance and Restructuring”).\n\n Thus, although it is unclear what “roles” the LOIs expected Korean banks to perform in\nconnection with the corporate sector restructuring, the LOIs clearly circumscribed such “roles” to be\nperformed by the banks. In no event had the banks b een directed to bail out corporations and act\nagainst the market principles. In this regard, the EC’s allegation to the contrary is refuted by the LOIs\nas such.\n\n As Korea has noted, the IMF was apparently concerned with the example of some other\ncountries experiencing financial stress where banks did not move expeditiously to clear up problem\nloans and instead left unrestructured loans on their books. The results in some places were\nunfavourable. The IMF made clear that it was interested in seeing a rapid and market-based\nrestructuring of bad loans. The IMF made clear to the EC a number of times that it considered that\nKorea banks were quite successful in pursuing market-based results from this process.\n\n4. Question\n\n Paragraph 209 of Korea’s Oral Statement: If the tax breaks pursuant to Article 45-2 of\nthe Corporate Tax Act referred to were not inte nded to apply only to the Daewoo workout why\nwere they introduced in conjunction with that workout and granted for only three months –\nenough time to allow Daewoo to capture them? How may other companies have benefited? Is it\nstill in force?\n\nResponse\n\n Article 45-2 of the STTCL was intended to exte nd the tax provision to workout companies as\nwell as companies undergoing corporate reorganization. When the law was deliberated at the National\nAssembly, every company which could be affected by the proposed law was interested and waited for\nthe law to be passed. The law has a broad base of a pplication in terms of the companies to which it\ncould apply.\n\n The law was extended twice so that workouts and corporate reorganizations carried out until\nthe end of 2002 could be covered. It is normal for ta x laws in Korea to be adopted on an annual basis.\nNo records have been kept either in court or by the tax administration to identify the companies that\nmade use of this tax provision.\n\n5. Question\n\n Paragraph 291 of Korea’s Oral Statement: Does Korea agree that Exhibits Korea-113\nand 114 do not relate to the Hamburg Süd/MOCIE case that is referred to?\n\n The ship subject to the DSME offer (Exhibit Korea – 114) is a 5.600 teu container ship\n(Ref. No. BPT-HAM-101-001) for USD 53 Mio while the MOCIE letter to DSME and SHI\n(Exhibit Korea – 112) concerned a 4.100 teu container ship (Ref. No. HAM-100-001) for a\ncontract price of USD 58 Mio. Exhibit Korea – 113 also refers to a ship priced at 53 Mio. USD,\nwith payment terms different from those listed in the MOCIE letter.\n\nResponse\n\n Korea reconfirms that both E xhibits Korea -113 and 114 are indeed related to the Hamburg\nSüd containership contract.\n\n The EC fails to recognize that the shipbuild ing industry uses two sta ndards of measurement\nfor the loading capacity of a containership, i.e. teu and ‘14 tonne homogenised’ teu value.\n4 This is\nreflected in the seemingly different descriptions between the MOCIE letter (Exhibit Korea – 112) and\nthe DSME offer (Exhibit Korea – 114) which nevert heless designate the same vessel. In the Hamburg\nSüd case, the buyer initially specified the containershi p with a capacity of 5,600 teu by using the first\nmethod. But, at the later stage of negotiations, the buyer began to use the second method, i.e. the\n14 tonne homogenised teu measurement, thereby conver ting the capacity into 4,100 teu. This is the\nreason why the initial DSME offer referred to a 5,600 teu containership while the MOCIE letter\nreferred to 4,100 teu, quoting it from the final contract. Therefore, Korea again confirms that Exhibits\nKorea -113 and 114 are addressing the same Hamburg Süd project in question which the EC has been\ntaking issue in the present proceeding.\n\n Also, “HAM-100-001’ and “BPT-HAM-101-001” were only the reference numbers of the\nsubject vessel specifications. DSME initially used reference number “BPT-HAM101-001” to refer to\n“outline specification”. But, as the specifications have been finalized as a result of negotiations with\nHamburg Süd, DSME assigned the final reference number “HAM-100-001”. However, these numbers\nreferred to the same project. Designating different specification reference numbers at different stages\nof the negotiation process is a normal practice in the shipbuilding industry. Such a practice is the\nresult of the fact that shipbuilders and buyers need to identify the agreements reached at different\nlevels due to the sheer length of the negotiations for a shipbuilding contract.\n\n In addition, as the EC well knows, it is not uncommon for a shipyard to make different price\nquotations depending on the payment te rm that the buyer will ultimately select. As is clearly stated in\nExhibit Korea – 114, DSME quoted two different prices for the same vessel based on different\npayment terms. Thus, USD 53 million was offered based on a “top heavy” payment term whereby\n90 per cent of the price would be settled at the time of the signing of the contract and 10 per cent at\nthe time of the delivery of the ship. At the same ti me and in the same written offer, a price of USD 58\nmillion was also offered based on a rather “tail h eavy” payment term, i.e, 10 per cent at contract\nsigning, 10 per cent six months after the contract, 10 per cent at keel-laying, 10 per cent at launching,\nand 60 per cent at delivery. DSME gave this offer verbally to the broker (Water J. Hinneberg) on\n30 August 2002 and then confirmed it by sendi ng a written offer (Exhibit Korea – 114) on\n2 September 2002. The price offered of USD 53 m illion mentioned in the broker’s letter (Exhibit\nKorea – 113) meant the “top heavy” price offered by DSME, which was equivalent to USD 58 million\non a “tail heavy” basis.\n\n As stated by Korea in its Oral Statement a nd response to the EC’s question at the Second\nSubstantive Meeting, the buyer, Hamburg Süd, unr easonably forced DSME to reduce the offer price\nto the level of USD 55 million on a “tail heavy” basis, which was the price level offered by a\nEuropean shipyard, Odense (Exhibit EC-88). At that time, the Korean shipyards, DSME and\nSamsung, had already offered prices at the level of USD 58 million.\n\n4 Teu stands for twenty-foot equivalent unit and measures a vessel’s capacity to load containers. The\naccuracy of this measurement depends on the method of ca lculation, whether the ship capacity for only loaded\ncontainers is taken into account, and whether the deadweight capacity allows a full load of containers. The\nindustry has therefore developed a measure (known as ‘14 tonne homogenised’ teu value) which is the\ndeadweight (payload) of the container ship divided by 14. This gives the number of containers (1 standard\ncontainer = 1 teu) that a ship can carry within its dead weight payload if each one weighted 14 tonnes. This\nfigure can be significantly different to the stated teu va lues of some ships. This value represents a ‘nominal\ncontainer capacity’ calculated on a standard basis.\n\n Does Korea admit that MOCIE intervened and asked Daewoo to raise the price by\nUSD 3 Mio which is supported by the clear language in Exhibit Korea – 112. Does this not\ncontradict what Korea responded in its Resp onse to Question 82 from the Panel where you\nstated that MOCIE was not concerned with the price level?\n\nResponse\n\n In Korea’s opinion, there is no difference be tween the language in Exhibit Korea – 112 and\nthe response to Question 82. It is clear from both that MOCIE was not concerned with the price level\nas such but with the anticompetitive behaviour.\n\n6. Question\n\n Regarding paragraph 292 of Korea’s Oral Statement, explain what USD 10 million\nvessel you are referring to and what intimation by the EC this refers to.\n\nResponse\n\n As was clarified by Korea during the Second S ubstantive Meeting as well as in the final text\nof the Oral Statement filed on 14 June 2004, this refers to paragraph 331 of the EC’s Second Written\nSubmission.\n\nRESPONSES OF KOREA TO QUESTIONS FROM THE PANEL AT THE SECOND MEETING\nAND COMMENTS OF KOREA TO SOME OF THE QUESTIONS ADDRESSED BY THE PANEL\nTO THE EUROPEAN COMMUNITIES\n\nI. TO KOREA\n\nA. KEXIM LEGAL REGIME\n\n103. What is the precise legal basis for Korea ’s assertion (at para. 99 of its rebuttal\nsubmission) that KEXIM is explicitly required by law to operate on a market-oriented basis?\n\nResponse\n\n Korea considers that the following criteria must be reviewed for determining whether a\nfinancial institution is operating on a market-oriente d basis: (i) whether to appropriately assess the\ncredit risks of the borrower; (ii) whether to apply interest rates or guarantee premia commensurate to\ncredit rating of the borrower/applicant; (iii) whethe r to take into account market situations when\nsetting up interest rates/premium; (iv) whether to properly manage risks associated with the KEXIM\nbusiness and (v) how to ensure soundness of management.\n\n(i) Assessment of the credit risks of the borrower\n\n Already in the period preceding 2000, KEXIM co mpared the credit ratings made by outside\ncredit rating agencies, and for any given borrower (applicant) KEXIM used the lowest credit rating\nfound with respect to the borrower (applicant). In f act, in order to effectively manage credit risks,\nKEXIM established the Risk Management Commi ttee as early as in 1998 to set up policies and\nguidelines (e.g., Regulations for Credit Rating Evaluati on) regarding risk management in KEXIM. In\naddition, the Risk Management Department and the Credit Evaluation Office have been set up under\nthe Committee for implementing and administeri ng the policies and guidelines by the Committee.\nThese two departments have been in operation inde pendently from the financing departments in order\nto ensure a transparent and effective risk management.\n\n As from 2000, as noted in Exhibit Korea – 91, KEXIM implemented its own credit rating\nsystem pursuant to the recommendations by the Ba nk for International Settlement (through Basel II)\nand the Financial Supervisory Service of Korea, a nd has since then evaluated credit ratings of the\nborrowers (applicants) in accordan ce with the enhanced credit risk management. Currently, KEXIM\nclassifies the credit ratings into 14 grades and evalua tes credit ratings of borrowers (applicants) after\nassessing five factors of credit risks (i.e. industry risk, business risk, management risk, financial risk\nand future cash flow risk) associated with borrowe rs/applicants. For the details of KEXIM’s credit\nrating system, please refer to Exhibit Korea – 117\n (Korea Annex V Attachment 1.1(24)-2) submitted\nherewith.\n\n(ii) Application of credit risk spr eads commensurate to credit ratings\n\n Pursuant to Articles 8, 14 and 25 of the KE XIM Guidelines for Interest Rates and Fees\n(Exhibit EC - 13), it is required to add credit risk sp reads onto the base rates (whether it be an interest\nrate for loans or a premium for guarantees). Thes e credit risk spreads to be added are varying\ndepending on the credit ratings of bor rowers/applicants. This may in turn result in different overall\ninterest rates or premia applied to the borrowers/a pplicants. As to the structures of KEXIM interest\nrates and guarantee premia, please refer to Korea’s Response 47 to the Panel Questions and Exhibits\nKorea - 12 & 14.\n\n(iii) Taking into account market situations\n\n As detailed in Korea’s Response 47 to the Panel Questions, the base rates for KEXIM loans,\nwhich are determined pursuant to Articles 10 & 11 of the KEXIM Guidelines for Interest Rates and\nFees, are by themselves designed to properly reflect the prevailing level of interest rates in the\nfinancial market at the relevant time. In addition, the “market adjustment rates” which are to be\napplied pursuant to Articles 14 & 25 of said Guidelin es also ensure the interest rates and guarantee\npremium to fully reflect the current market situati ons (for details of market adjustment rates, please\nrefer to Korea Response 57 to Panel Questions).\n\n(iv) Proper management of business risks\n\n In order to properly manage business risks of KEXIM, Article 17-10 of the KEXIM Decree\n(the Enforcement Decree of KEXIM Act, Exhibit EC-11) requires KEXIM to establish and operate a\nrisk control system, and currently the above-menti oned Risk Management Committee is in charge of\nsuch risk control tasks. For admi nistering these tasks, the Committ ee has set forth and enforced the\nRegulation for Risk Management whereby all ri sks associated with KEXIM business including the\ncredit risk, market risks and the li quidity risk are being closely watched. Further, pursuant to\nArticle 29 of the KEXIM Act (Exhibit EC - 10) an d Article 17-10 of the KEXIM Decree, KEXIM has\nestablished the standards and procedures for business conducts (one of which is the Operating Manual\nsubmitted in the Annex V process as Attachment 1.1(9 )), which are to reduce potential risks related to\nday-to-day business practices of KEXIM.\n\n(v) Ensuring sound management of KEXIM\n\n Articles 17-5 through 17-9 of the KEXIM Decree specifically set limitations and restrictions\nto KEXIM practices for the purpose of ensuring th e sound management of KEXIM. Such limitations\nand restrictions pertain to credit extension ceili ngs, restrictions on investment activities or holding\nsecurities and disposals of non-business assets. These limitations and restrictions safeguard KEXIM\nagainst potential business risks. Further, KEXIM is subject to supervision by the Financial\nSupervisory Commission (“FSC”) as well as the Mi nistry of Finance and Economy pursuant to\nArticle 39 of the KEXIM Act and Articles 17-12 & 17-13 of the KEXIM Decree. The Ministry and\nthe FSC regularly review KEXIM’s compliance with the limitations and restrictions as mentioned\nabove. In addition, KEXIM is required to regular ly check the soundness of its holding assets and to\nmaintain an appropriate level of reserves for ba d debts. KEXIM is also required to follow FSC\nregulations regarding the BIS adequacy ratio and the ratio for the foreign currency assets/liabilities.\nThe limitations, restrictions and requirements related to the sound management are corresponding and\nsimilar to those imposed onto the other commerc ial banks under the Banking Act. The FSC may issue\nan order to KEXIM to take the necessary measur es (which are equivalent to “Prompt Corrective\nMeasures” by the FSC against other commercial banks) in cases where it finds that KEXIM’s\nmanagement is insufficiently sound due to its non-compliance with the FSC regulations ( See\nArticle 39 of the KEXIM Act and Article 17-13 of the KEXIM Decree).\n\nLegal requirement for operating on a market-oriented basis\n\n As shown above, the KEXIM Act, the Decree and other internal regulations, which can be\ncollectively referred to as the KEXIM legal regime, aim at making certain that KEXIM operates on a\nmarket-oriented basis. In other words, the system ic safeguards, all of which are based on the KEXIM\nlegal regime, require and enable KEXIM to secure its operations on a market-oriented basis. Korea\nreiterates that KEXIM has continuously earned op erating profits since its establishment (as to\nKEXIM’s operating profit, please refer to the Korea Response 49 to the Panel Questions).\n\n104. Korea states (in response to Question 53 fr om the Panel) that Article 24 of the KEXIM\nAct should have been repealed, and that in fact “KEXIM has been contemplating proposing the\n\nrepeal or amendment of Article 24”. Please provide proof or supporting evidence (minutes of\nmeetings, for example) for this assertion?\n\nResponse\n\n Korea hereby submits Exhibit Korea – 118 which proves that KEXIM contemplated the\nrepeal of the provision of Article 24 of the KEXIM Act already in 1999/2000. As explained in the\nKorea’s response to the Panel’s Question 53, the restriction on KEXIM’s business scope had already\nbeen eliminated by amending Article 18 of the KE XIM Act in 1998. This amendment was enacted in\norder to fully and appropriately reflect financial market realities which had materially changed since\nthe enactment of the KEXIM Act. While this amendment officially allowed KEXIM to fully\nparticipate in the financial market, even prior to this amendment, KEXIM had already been active in\nthe market where other commercial banks were prev alent, therefore entailing increased competition.\nThus far, the repeal of the provision has not been proceeded with b ecause of the burdensome\nlegislative procedures required for the amendment. In practice, in light of Article 18 of the KEXIM\nAct and because KEXIM has had no restrictions for competing with other commercial financial\ninstitutions notwithstanding Article 24, KEXIM has not been constrained by the anachronistic “non-\ncompetition” provision in the KEXIM Act. Further, Korea notes that it already has provided\nconsiderable empirical evidence of competition between KEXIM and other financial institutions.\n\n105. Until what date was Article 24 applied, and in which specific instances? Please explain\nand describe in full.\n\nResponse\n\n As submitted, after the incorporation of KEXI M, the Korean financial market developed and\ncommercial financial institutions began to provide the specialized financing services in which\nKEXIM had been involved. This resulted in compe tition with other financial institutions in virtually\nall areas of the KEXIM financial services (as to the types of KEXIM financial services, please refer to\nKorea’s Response to the Panel’s Question 53). Korea reiterates that none of the relevant provisions in\nthe KEXIM Act are intended to prohibit other financia l institutions to participate in financial services\nextended by KEXIM or, conversely, to require KEXI M to exit the market as soon as other financial\ninstitutions entered into the market. As submitted, as for the APRG, KEXIM took only a small portion\nof the market share (less than 20 per cent) prior to the Asian financial crisis, which shows that there\nwas a fierce competition in the market. Virtually all financial institutions have provided overseas\ninvestment credits since the restrictions on foreign currency business were lifted in the late ‘90s. Also,\nKEXIM has been competing with other financial ins titutions in the area of the import credit market.\nHaving extended such financial services, KEXIM has never been sanctioned by the supervisory\nauthorities or challenged by other commercial fina ncial institutions by claiming the existence of\nArticle 24 of the KEXIM Act.\n\n106. At para. 45 of Korea’s second oral statement, you argue that if lending is provided on\ncommercial terms the lending entity is not a public body. Would this reasoning apply in the case\nwhere the Finance Ministry has a general practice of lending on a commercial basis? That is,\nwould the Finance Ministry be a private body (or in any event not be a public body)? Would the\nanalysis be the same if one day, exceptionally , the Finance Minister instructs his/her employees\nto provide a loan to his/her friend’s company at one third of the market rate? Would that loan\nconstitute a financial contribution? Why, or why not?\n\nResponse\n\n Korea stated in paragraph 24 of its Oral Statem ent that it considers there to be three distinct\ncategories: (1) governmental organs; (2) public bo dies; and (3) private bodies. Korea offered the\nFinance Ministry as an example of a governmental organ that would be included in category (1). In\n\ncontrast, with respect to para-statal entities th at are not organs of government, under the treaty\nlanguage as well as the interpretative guidance of the Articles on State Responsibility and\nCommentaries, they are prima facie not considered as acting with governmental authority.\n\n Paragraph 45 was not referring to an organ of government, but to a situation involving a para-\nstatal or government-owned entity. The EC has neve r alleged that any of the banks in question were\norgans of government, only that they were public bodies. Thus, the second half of the question does\nnot really apply in the context of the Finance Minist ry. On the other hand, if a para-statal entity were\noperating a commercial programme (and therefore would not be considered a public body), the sort of\nintervention noted in the question could constitute entrustment of the para-statal entity as a private\nbody depending on the facts. As Korea has noted in paragraphs 43-44, there is no loophole in the\ntreaty scheme; the difference is in the type of proo f that must be presented depending on whether it is\na private or public body. The utter lack of eviden ce regarding entrustment or direction is what has\ncompelled the EC to try to construct a novel and sweeping definition of “public body”.\n\n107. At para. 56 of Korea’s second oral stat ement, Korea states that so-called “market\nwindow” financing falls outside the coverage of the OECD) export credit arrangement Is Korea\nthereby arguing that such financing falls outside the coverage of the SCM Agreement? If so, is\nthis because Korea considers that such financin g does not constitute a financial contribution?\nPlease explain your reasoning.\n\nResponse\n\n The Panel’s characterization of Korea’s comment in paragraph 56 is, perhaps, somewhat too\ncategorical. Korea purposely used a passive grammatical construct: “They are considered market-\nbased commercial activities in competition with other banks.” The reason for this construct is that\nbecause there is a lack of reporti ng, there is a certain amount of self-definition as to what is included\nin the concept of “market-window”. Nonetheless, irrespective of what is included as a practical\nmatter, Korea does consider that the concept provides a valid distinction.\n\n In order to answer the Panel’s question, one must once again refer to the different categories\nof entities as discussed in the answer to the previous question. Therefore, if an organ of government\nis offering the financing, it may be a subsidy depend ing on whether or not there is a benefit. On the\nother hand, if the financing is being offered as part of a commercial programme by a para-statal\nentity, it is presumptively not “governmental” and therefore would not be considered a financial\ncontribution by a government unless specifically demonstrated as such. There are two points to note\nhere. First, the issue of whether or not it is a commercial programme is one for the complainant to\nestablish as an initial matter. Merely alleging that the programme is not commercial because the entity\nis government-owned as the EC has done collapses two distinct analytical steps into one. Second, as\nalso discussed, even if the overall programme is on a commercial basis and, therefore, the entity is not\nconsidered as a public body for purposes of a disput e, it is still the case that the complainant has the\npossibility of demonstrating that there was governmental entrustment or direction in a particular case.\nOf course, the EC has been unable to do this (becau se the evidence does not exist), which is why it is\ntrying to build its whole case on the fact of government ownership.\n\nB. PAST SUBSIDIES\n\n108. Korea has made various comments regardi ng the EC’s claims concerning so-called\n“past” subsidies. In particular, Korea referred to this issue in its reply to Question 83 from the\nPanel, and at paras. 62, 63 and 93 of its second oral statement. We understand that Korea is not\nseeking a ruling that the EC is precluded from ch allenging “past” subsidies. Is this a correct\nunderstanding? If not, why not?\n\nResponse\n\n It is correct that Korea is not making a gene ral argument that the EC cannot challenge alleged\npast subsidies as a matter of principle. However, to be clear, there are two different aspects to this\nissue depending on whether one is refe rring to Part II or Part III of the SCM Agreement. Allegations\nof prohibited subsidization are much more of th e nature of “standard” GATT/WTO dispute settlement\ncases where the complainant is generally considered to have a general right to request a ruling\nregarding the imposition of a measure by another Memb er that it considers is inconsistent with the\nother Member’s treaty obligations. It may be the case, of course, that such a ruling is of only historical\ninterest if the facts are that the respondent is no longer implementing measures that are inconsistent\nwith its obligations. This would be the case if there were no longer benefits being provided within the\nmeaning of Article 1.1(b) of the SCM Agreement . Of course, it does raise a question as to the\nmeaningfulness of such a ruling or recommendati on by the DSB for a Member to withdraw the\nsubsidy as required by Article 4.7 if in fact there is no longer any subsidy. In light of this point, the\nPanel must take into consideration with in the full context of Part II of the SCM Agreement whether it\nconsiders that there actually are prohibited subsidies being provided.\n\n Regarding claims under Part III with respect to allegations of Adverse Effects, the Panel must\nrecognize the sui generis nature of its inquiry in this rega rd. In no other area of WTO dispute\nsettlement must a complainant demonstrate that a measure has caused adverse effects. To put it\nanother way, subsidies are considered illegal only if they cause adverse effects. Moreover, Article 7.8\nprovides that they are illegal only to the extent of such an adverse effect. Thus, there is the unique\nsituation of a measure only being “partially” inconsistent with a Member’s WTO obligations. One can\nassume that, in determining whether the alleged subs idies in question have caused adverse effects, a\npanel will look at such alleged effects over a period of time. It is axiomatic that in any injury-type\ninquiry, the most recent period is the most rele vant. Thus, the probative value of evidence of\nsubsidization in earlier periods is highly questionable if the evidence is that there was no subsidization\nor no adverse effect in the most recent period. Thus, it is not a qu estion of a legal bar to looking at\nearlier periods; rather, it is a question of the releva nce and probative value of such evidence. In light\nof the requirements that there be a demonstration of actual adverse effects and that the subsidies are\nonly illegal to the extent of such causation, a panel would need to explain in detail why it considered\nthat a subsidy that was no longer causing adverse effects would be actionable. Thus, Korea is not\nsaying that historical evidence is irrelevant in analyz ing trends that lead to present adverse effects; it\ncan have an impact on the overall analysis. Howeve r, in the case where the evidence is that such\nadverse effects are no longer being caused or there is no longer a subsidy, it is unclear what the basis\nof such a determination would be.\n\nC. APRG/PSL\n\n109. Korea argues at para. 80 of its second or al statement that foreign APRG providers\ninclude a country-risk spread for APRGs extended to Korean shipyards, which accounts for the\nhigher rates charged by the foreign APRG issu ers than those charged by KEXIM. Should not\nKEXIM have applied a similar country-risk spread, or otherwise have taken into account the\nrisk factor of investing in Korea? Please explain. Why sh ould foreign APRG providers,\nincluding those based in Korea (See Exhibit Ko rea – 87, page 5, which indicates that both\nforeign banks A and B issue APRGs though their Korean branches) incur more risk in investing\nin Korea than Korean banks?\n\nResponse\n\n As detailed in Exhibits Korea - 84 thr ough 87 and stated by Korea during the Second\nSubstantive Meeting, the country risk premium (or count y risk spread) is to be applied to the financial\ntransactions between companies established in differe nt countries. In general, the term “country risk”\ntypically covers the risk that economic, social, and political conditions and events in a foreign country\n\nmay adversely affect an institution’s financial inter est. The country risk factor is not understood in\nfinancial markets to cover risks in transactions between parties established in the same country.\nRather, in these instances, the lenders or providers focus on the general credit risks of their counter-\nparties.\n\n For the better understanding of the Panel and for illustrative purposes, Korea submits the\nelements of country risk assessed under the OECD Arrangement on Officially Supported Export\nCredits (See Article 24.a) of the OECD Arrangement). These are:\n\n - general moratorium on repayments decr eed by the buyer's/borrower's/guarantor's\ngovernment or by that agency of a country through which repayment is effected;\n\n - political events and/or economic diffic ulties arising outside the country of the\nnotifying Participant or legislative/administrative measures taken outside the country\nof the notifying Participant which prevent or delay the transfer of funds paid in\nrespect of the credit;\n\n - legal provisions adopted in the buyer's/bo rrower's country declaring repayments made\nin local currency to be a valid discharge of the debt, notwithstanding that, as a result\nof fluctuations in exchange rates, such re payments, when converted into the currency\nof the credit, no longer cover the amount of the debt at the date of the transfer of\nfunds;\n\n - any other measure or decision of the government of a foreign country which prevents\nrepayment under a credit; and\n\n - cases of force majeure occurring outside the country of the notifying Participant, i.e.\nwar (including civil war), expropriation, revol ution, riot, civil disturbances, cyclones,\nfloods, earthquakes, eruptions, tidal waves and nuclear accidents.\n\n When KEXIM extends APRGs to Korean shipya rds, the transactions involve parties in the\nsame country of establishment and there is, as a result, no need for KEXIM to consider a “country\nrisk.” Rather, as explained in Response 103 above, KEXIM is looking at the general credit risks of the\napplicant by factoring in all relevant risks su ch as industry risk, business risk, management risk,\nfinancial risk and future cash flow risk of the applicant. In contrast with KEXIM, on top of\nconsidering the usual expected risks, foreign APRG providers needed to take into account a risk of a\ndifferent dimension, i.e. the country risk, as they are located outside Korea. The additional risk\nnotwithstanding, foreign providers extended APRG s to Korean shipyards when they were so\ndesignated by the buyers and, in fact, earned, high guarantee premia.\n\n Further, Korean branches of foreign APRG provide rs need to factor in such country risk, as\nthe foreign APRG providers themselves, not the br anches of such foreign providers, will bear the\nultimate and final legal liability (this is evident by the operation of law) of having to settle the\nadvance payments to the buyer of the vessels in case of a contractual default by a Korean shipbuilder.\nAs a result, the country risks have been factored into the premium for guarantees issued by Korean\nbranches of foreign APRG providers.\n\n110. Please comment on the EC’s assertion (a t part 107 of its Second Written Submission)\nthat Korea failed to provide details of the rat es of five of the APRGs issued for Samsung by\ncommercial banks in 1997.\n\nResponse\n\n Korea provided the best information available at the time of the Annex V procedure. Korea\nnotes that much of the information requested in A nnex V and subsequently has not been in the hands\nof the Government of Korea. Having confirmed with Samsung, Korea understands that the rates of the\nfive APRGs referred to by the EC were not av ailable as the required preservation period of the\nrelevant documents had expired. Where informati on for some of the APRGs issued in 1997 was still\navailable, such information was submitted.\n\n111. In response to Question 72 from the Panel, Korea submitted certain documents\ncontaining redactions. What is the reason for those redactions?\n\nResponse\n\n In Question 72, the Panel requested Korea to pr ovide internal documents related to a certain\nproject specifically identified by the Panel. As the original document (of which the version with\nredactions was submitted by Korea as Exhibit Korea – 60) contained information on other projects\n(which were not requested by the Panel) which is by nature business confidential information, Korea\ndeleted the information not related to the project identified by the Panel.\n\n112. Were any APRGs issued to Korean shipyards by independent financial institutions after\n28 May 2001? If so, why weren’t these included in Korea’s reply to the Facilitator’s\nquestionnaire under the Annex V procedure?\n\nResponse\n\n Korea would like to note that it considers KEXIM to be an “independent financial\ninstitution.”\n\n Notwithstanding this, Korea confirms that it pr ovided all information in Attachments 1.2(31)-\n1 through 1.2(31)-8 of the docum ents submitted during the Annex V process as to APRGs issued by\nKorean financial institutions (except some information related to foreign APRGs) to Korean shipyards\nup until the Annex V procedure was initiated. Information as to APRGs issued after 28 May 2001 was\nincluded therein also. Please refer to Attachment 1.2(31)-1 through 1.2(31)-8 (Exhibit EC-24) as\nregards the information on such APRGs.\n\n113. In respect of Koreas repl y to Question 71 from the Pane l, please provide supporting\nevidence for Korea’s assertion that the Kook min and Woori Bank rates for Samsung APRGs\nwere [BCI: Omitted from public version] instead of [BCI: Omitted from public version].\n\nResponse\n\n Korea hereby confirms that the Kookmin Bank and Woori Bank rates for Samsung APRGs\nwere [BCI: Omitted from public version] . Korea’s prior statement that is not consistent with this\ninformation was inadvertently made due to clerical mistake by the company in pulling together the\nresponse. Korea regrets any confusion.\n\n114. Regarding Exhibit Korea – 99, why did KEXIM continue to apply the same credit\nspread after DSME entered financial difficulties?\n\nResponse\n\n As clarified during the Second Substantive Mee ting, Korea did not, and could not, endorse the\nEC’s benchmark as suggested in Exhibit EC - 125 or EC Attachment - 9. Korea merely submitted\n\nExhibits Korea - 93 through 100 (i) to illustrate that there are critical fallacies in the EC’s calculations\ndue to its misunderstanding regarding the interest ra te structure of the KEXIM PSLs and (ii) to show\nthat no benefit exists even under the EC’s ow n hypothetical and inaccurate methodology. Thus,\nExhibit Korea – 99 is the basis for an argument in th e alternative and is also a hypothetical one based\non various assumptions, not reflecting actual transactions . In particular, it was prepared to show that\neven if DSME had the worst credit rating during the period of the workout, no benefit was afforded.\n\n As evidenced in Exhibit Korea – 92, DSME was rated as P5 by KEXIM during the workout\nperiod when DSME was under the worst financial situ ation. Hence, despite the fact that KEXIM did\nnot retain its current credit rating system before the Asian Financial Crisis and DSME workout, it is a\nlogical speculation that DSME’s credit rating prior to the workout would have been better off\ncompared to its rating when DSME was going through the workout process. This can be substantiated\nby the fact that the credit rating of DSME was adju sted upward to P4 right after the graduation out of\nthe workout (s ee Exhibit Korea – 92). Nonetheless, Exhibit Korea – 99 was submitted to show that\nduring the entire period the EC indicated in its Exhibit EC – 125, no benefit was afforded to DSME.\nAnd, of course, if the better credit rating were to be assigned in Exhibit Korea – 99 for the period\npreceding the workout, it would be shown that th e negative benefit margins would even become\nlarger.\n\nD. ALLEGED ACTIONABLE SUBSIDIES\n\n115. Please comment on para. 259 of the EC’s Second Written Submission, concerning the\nfate of Mr. Do-Sang Lee’s [BCI: Omitted from public version] shareholding in Daedong. Under\nwhat legal previsions did the complete cancellation of Mr. Lee’s shareholding take place? Please\nexplain fully.\n\nResponse\n\n In the context of “corporate reorganization” (cour t receivership) under Korean law, the fate of\nshareholders of the subject company is pre scribed by the Corporate Reorganization Act ( See\nExhibit EC - 43). Articles 221(3) and (4) of the Corporate Reorganization Act provide as follows:\n\n (3) In cases where the total liabilities of th e company at the time of commencement of\nthe reorganization proceeding exceed its tota l assets, the reduction of capital shall be\nprovided for [in the reorganization plan] on su ch terms that no less than a half of the\ncompany’s issued stock is written off.\n\n (4) In cases where the commencement of the reorganization proceeding has been caused\nby acts for which directors or equivalent persons, or managers of the subject company\nare seriously responsible, the reduction of capital shall be provided for [in the\nreorganization plan] on such terms that no less than two thirds of the shares of stock\nheld by a shareholder who has exercised considerable influences on such acts, his\nrelatives, and other shareholders who have a special relationship with him as set forth\nin the Supreme Court Regulations, are written off.\n5\n\n As clearly indicated in the above provisions, the thresholds of a “half” or “two thirds”\nmentioned in the above provisions constitute a mi nimum level for the stock write-off. Therefore,\nArticle 221 of the Corporate Reorganization Act requi res that the reorganization plan provide for a\nstock write-off that should not be less than th ese levels but may even achieve the complete\ncancellation of the stock. Based on these legal requi rements, the bankruptcy courts in most cases\n\n5 This is more accurate transla tion. The unofficial translation of the Corporate Reorganization Act\nsubmitted by the EC to the Panel as Exhibit EC - 43, is not entirely accurate. For verification purposes, Korea\nsubmits the Korean version of Article 221 of the Act as Exhibit Korea – 119.\n\ncompletely cancelled the shares held by a controllin g shareholder particularly when the shares had no\nvalue due to insolvency.\n\n In the case of Daedong, it was determined th at the total liabilities of Daedong exceeded the\ntotal assets (Exhibit EC - 78, Final Corporate Reorganization Plan for Daedong, Attachment 1,\nBalance Sheet). As such, the receiver was required by law to write-off the shares by not less than\n50 per cent. Therefore, the receiver proposed a reor ganization plan whereby the shares held by all the\nshareholders of Daedong, except Mr. Do-Sang Lee, we re reduced by 80 per cent (i.e. 5:1 ratio). In\naddition, the shares of Mr. Do-Sang Lee, who, as th e major shareholder, had exercised a considerable\ninfluence over the acts of directors and managers , were required by the Corporate Reorganization Act\nto be reduced by at least two thirds. Ultimately, taking into account the fact that the Daedong shares\nhad no value and that Mr. Lee was fully responsible for the failure of Daedong, the receiver proposed\nthe complete cancellation of Mr. Lee’s shares. Ulti mately, however, the acceptance of this proposal\nwas Mr. Lee’s choice. Korea cons iders that the EC’s highly personal, disparaging remarks about\nMr. Lee’s motivation are regrettable.\n\n116. Korea asserts that Articl e 45-2 of the Corporate Tax Act does not constitute revenue\nforgone, and did not confer a benefit. According to the news report in Exhibit EC-136, however,\na Daewoo company official stated that Daewoo would “be exempted from taxes totalling\n236 billion won’. Please comment, and explai n how a 236 billion won tax exemption is not\nrevenue forgone and did not confer a benefit\n\nResponse\n\n Under the SCM Agreement , the EC has the burden to prove specifically what government\nrevenue was otherwise due and how such revenue was foregone or not collected (Article 1.1(a)(1)(ii)).\nThe EC has failed to carry this burden of proof. Moreover, it appears that the EC still has no clear\nunderstanding of the Korean tax scheme. As a resu lt, Korea still can not determine specifically what\nthe EC’s allegations on tax concessions are about.\n\n The news report in Exhibit EC - 136, which quoted the alleged statement by a Daewoo\nofficial, establishes nothing about the types of taxes concerned, applicable provisions of tax laws, tax\nrates, calculations of the tax amount involved, how they were foregone, etc. Given the complication\nand technicalities of the tax issues, no Panel wo uld make an affirmative finding of financial\ncontribution and benefit on the basis of such a very questionable newspape r article. Moreover, the\namount of KRW 236 billion allegedl y mentioned by a Daewoo official does not distinguish what\nportion of this total amount is attributable to DSME as distinguished from the portions attributable to\nthe machinery company and to the remaining DHI. In short, the EC has not established a prima facie\ncase of the tax concession as required by Article 1.1(a)(1)(ii) of the SCM Agreement.\n\n Under these circumstances, Korea is placed in an awkward position when it is asked by the\nPanel to “explain how a 236 billion won tax exempti on is not revenue foregone and did not confer a\nbenefit”. This question assumes that there was a tax exemption of KRW 236 billion, but Korea\ndisagrees that a 236 billion won tax exemption has ev er been established by the EC. Unless the EC\nfirst explains how KRW 236 billion or whatever amount has been calculated and under what\nprovisions of tax laws, it is impossible for Korea to explain how this amount is not revenue forgone.\nNonetheless, Korea would like to comply with th e request of the Panel by providing further\nexplanations on the tax issue, while again reserving its rights regarding the burden of proof.\n\n First of all, Korea refers the Panel to pa ragraphs 221 and 222 of the EC’s Second Written\nSubmission, in which the EC made clear that its “core claim” was the “temporary tax exemptions”\ngranted under Article 45-2 of the Special Tax Treat ment Control Law (“STTCL”) which extended tax\nincentives under Article 46 of the Corporate Tax Act. It appears that the EC believes that Exhibit EC -\n\n136 provides evidence of the size of tax incentives under the above Article 46 of the Corporate Tax\nAct which had been “extended” by Article 45-2 of the STTCL.\n\n However, as Korea has repeatedly explained (see, e.g., paras. 206 – 208 of Korea’s Oral\nStatement at the Second Panel Meeting), the special tax treatment under Article 46 applies only when\n“valuation gains” have arisen to a spun-off company as a result of the “valuation” of assets carried out\nat the time of the spin-off. In the case of the DHI workout, the assets of the original DHI were spun-\noff to DSME and the machinery company at book value (i.e. without “valuation” of those assets).\nTherefore, DSME could not obtain any tax incentiv es under Article 46 of the Corporate Tax Act as\nextended by Article 45-2 of the STTCL.\n\n The fact that the DHI assets were transfe rred at book value to the spun-off companies is\nclearly demonstrated by Exhibit Korea – 120\n (1999 Anjin’s Workout Report, excerpted pages,\nAppendix 10), as well as by Exhibit EC-55 (DHI Workout Plan), Appendix D-11 (balance sheet) and\nExhibit EC-56 (Structure of spin-off). Also, the EC has never disputed this fact.\n\n Therefore, contrary to the allegation by the EC, there was no tax exemption granted to DSME\nunder Article 45-2 of the STTCL and Article 46 of the Corporate Tax Act. Thus, the EC’s “core\nclaim” fails, and the questionable statement by a Daewoo official in Exhibit EC-136 cannot prove\nanything when what the EC proposes to prove on th e basis of hearsay cannot “legally” make sense.\nFor the avoidance of any doubt, Korea hereby submits the text of Article 46 of the Corporate Tax Act\n(both the Korean original and English translation) as Exhibit Korea – 121\n\n In this situation, it is questionable that a Daewoo official could really have made the\nstatement about KRW 236 billion as was written by the journalist or whether the journalist\nmisunderstood. If a Daewoo official really made that statement, it may well be that he misunderstood\nthe facts and the applicable tax law. The other pl ausible answer might be that the Daewoo official\nmay have referred to a totally diffe rent type of tax incentive. A possible candidate is the “special\nadditional tax” which could have b een levied if there were gains from the transfer of certain assets\nfrom DHI to the spun-off companies. However, this tax was to be levied on DHI (remaining after the\nspin-off) under Article 99 of the Corporate Tax Act.\n\n Prior to 31 December 2001, the Corporate Ta x Act provided that, if a company realized\ncapital gains from the transfer of certain assets (e.g., land, building and other real property rights), the\ntransferring company was required to pay, in addition to ordinary corporate income tax, the so-called\n“special additional tax” at the rate of 16.5 per cent of the capital gains so realized (See Exhibit Korea\n– 121, Articles 2 and 99 of the Corporate Tax Act). Fo r the purpose of this tax, the ‘capital gains’\nmeant the amount of the transfer price of the assets concerned, minus their original acquisition price\nand acquisition costs. In the context of the DHI spin-off, DHI may have been required to pay a\nsubstantial amount of such special additional tax if capital gains had been realized through the transfer\nof assets to DSME and the machinery company. Even if the transfer of assets was made at book value,\nthe book value of those assets could have been higher than their acquisition prices and costs as a result\nof, among others, re-valuation made prior to the spin-off pursuant to the Asset Re-valuation Act.\n\n Again, it should be noted that the payer of such special additional tax was the transferor of the\nassets subject of the special additional tax (i.e. the remaining DHI). However, by virtue of a special\nprovision of Article 99(11) of the Corporate Tax Act, the transferor’s payment of special additional\ntax could be deferred if the transfer of assets took place as a result of, among others, a spin-off that\nsatisfies the requirements of Article 46 of the Corporate Tax Act. ( See Exhibit Korea – 121\n\nArticle 99(11)). In the case of companies in restruct uring, a problem arose due to the technical issue\nof not having precisely equal shareholding ratios due to the normal rules of share allocations in such\nsituations. If a provision such as Article 45-2 ha d been included in the STTCL, thereby treating a\nspin-off made on unequal shareholding ratios as sa tisfying the requirement of Article 46 of the\nCorporate Tax Act, then, the remaining DHI’s liab ility for special additional tax could have been\n\ndeferred (not exempted) pursuant to Article 99(11) of the Corporate Tax Act and the remaining DHI\nwould have been relieved of the burden to pay special additional tax immediately upon the spin-off.\n\n However, by virtue of a subsequent legislati on, the “special additional tax” was repealed as of\n1 January 2002 ( See Exhibit Korea – 121\n, Law No.6558 of 31 December 2001). As a result, any\nspecial additional tax liability of the remaining DHI (the provisions were only relevant to the\ntransferor, not a transferee such as DSME) was completely extinguished. 6 This repeal was made\nmainly because the special additional tax was c ontroversial as it operated as a double taxation in\naddition to ordinary corporate income tax which would also be assessed on the same capital gains as\nthose subject to special additional tax.\n\n117. Korea argues that the Daewoo workout was good for both domestic and foreign\ncreditors, and that the fact that foreign creditors took warrants is an indication of their support\nfor the workout. Could the foreign creditors ever have prevented the workout? Since they held\nonly [BCI: Omitted from the pubic version] per cen t of the debt, were they ever in a position to\nforce liquidation / court receivership? Please explain.\n\nResponse\n\n Under Korean law, the foreign creditors were able to obstruct DHI’s workout by filing a\npetition for a straightforward bankruptcy proceedin g. The Bankruptcy Act of Korea authorizes “any\ncreditor” (regardless of the percentage of debt held by it to the total debt) to file a bankruptcy petition\nwhen there is a cause of bankruptcy ( See Exhibit Korea – 122\n, excerpted Articles, Article 122(1)).\nThe cause of bankruptcy exists when the debtor is no t able to pay debts (Article 116) or its total debt\nexceeds the total assets (Article 117). Once the bankruptcy court adjudicates a bankruptcy, the court-\nappointed receiver liquidates assets and distributes the proceeds from liquidation to the creditors.\n\n Through a due diligence investigation, Ar thur Andersen (Anjin) found that, as of\nAugust 1999, DHI was not able to pay its total de bts and the creditors would recover only 28.4 per\ncent of their total debts ( See Exhibit Korea – 120\n, 1999 Arthur Andersen Report, excerpted pages,\npage 38). Therefore, any foreign creditor was ab le to file a petition for a bankruptcy proceeding\nagainst DHI.\n\n Despite a petition for bankruptcy proceeding, a court-receivership proceeding can be initiated.\nThus, if a petition for court-receivership (corporate re organization) proceeding is filed with respect to\na debtor which is under a bankruptcy proceeding, the latter can be suspended by the court order\n(Exhibit EC - 43, Corporate Reorganization Act, Ar ticle 37). However, the fact that the debtor\ncompany was going through a creditors-led “workout” procedure under the Corporate Restructuring\nAgreement cannot stop the bankruptcy proceeding.\n\n In the case of DHI, the foreign creditors we re also in a position to petition for a court\nreceivership as their total debt ([BCI: Omitted from public version], See Korea’s Annex V response\nAttachment 3.1(12)) accounted for approximately 17 pe r cent of the DHI’s total shareholders’ equity\n([BCI: Omitted from public version] ). Under the Corporate Reorganization Act, any creditor can\npetition for a corporate reorganization only if their debt accounts for not less than 10 per cent of the\ndebtor company’s “capital” (shareholder equity), not of the total debt (See Exhibit EC - 43, Corporate\nReorganization Act, Article 30(2)).\n\n Of course, the foreign creditors, holding less th an 3 per cent of the total debt, would not have\nbeen able to “force” DHI into court-receivership, as it was the court that ultimately decides on\n\n6 Korea also notes that this was generally available for any and all Korean corporations involved in any\n“asset transfer” transactions because the “special additional tax” itself wa s withdrawn in its entirety from the\nKorean tax system by virtue of the law of 31 December 2001.\n\nwhether to put the debtor into court-receivership an d, also, the reorganization plan had to be approved\nby the three groups of interested parties (i.e. 4/ 5 secured creditors, 2/3 of non-secured creditors, and a\nmajority of shareholders). Nonetheless, it is true under the Korean law that, as long as the foreign\ncreditors wanted to obstruct the creditors-led wor kout procedure for DHI, they could do so by simply\nfiling a petition for bankruptcy or court receivership.\n\n However, it should be noted that the foreign creditors of DHI were all non-secured creditors\nwhich might have ended up recovering only a mini mal amount of their debt if DHI had undergone a\nbankruptcy or court-receivership proceeding. Therefor e, it is inconceivable that the foreign creditors\nwould have ever considered petitioning for such a – for them - unfavourable proceeding.\n\n118. According to para. 139 of Korea’s rebuttal s ubmission, “Article 18 [of the Special Act on\nthe Management of Public Funds” strictly controls provision of new loans by the receiving\nbanks. Thus, this Article provides that ‘[i]f a financial institution which received Public Funds\npursuant to the provision of Article 17(1) intends to provide new funds to an unsound company\nas prescribed by the Presidential Decree’, it will be subject to a requirement that it shall enter\ninto a restructuring agreement with that unsound company” Does Article 18 only impose\nrestrictions on publicly-funded financial institut ions that intend to provide new funds to\nunsound companies? Are restrictions also impo sed if a publicly-funded financial institution\nchooses to do something other than provide ne w funds to unsound companies? If the latter\nquestion is answered in the negative, please give an example of something that a publicly-funded\nfinancial institution could do without incurring obligations under the Special Act on the\nManagement of Public Funds.\n\nResponse\n\n The purpose of Article 18 is to minimize the loss of public funds by restricting the banks that\nreceived public funds from lavishly providing new loans to unsound companies. This provision does\nnot affect the discretion of the institutions that obtained public funds to decide whether or not to\nextend new loans, but it applies only when a publicly-funded bank intends to provide new loans to\n“unsound” companies.\n\n Moreover, as clearly indicated by the provision of Article 18 itself (see Exhibit EC - 103), this\nprovision applies to a publicly-funded bank’s individual lending activity. In other words, the\nrestriction applies only when a publicly-funded financial institution decides to extend a new loan to an\nunsound company in an individual transaction betw een that particular bank and the unsound company\nas a borrower. Therefore, the “restructuring agreemen t” referred to in Article 18 means an agreement\nbetween the lending bank and borrowing comp any (normally called an “Memorandum of\nUnderstanding”) whereby the unsound borrower agrees to implement self-initiated actions, such as\ndisposing of unnecessary assets or businesses or reducing labour costs, in order to make itself more\naccountable for the new borrowing.\n\n In this regard, the provision of Article 18 does not apply to the cases where the publicly-\nfunded banks participate in a workout or court-r eceivership proceeding as a member of the creditors’\ncouncil or other interested parties’ meeting. In th e context of such a workout or court-receivership\nproceeding, the creditors are required to act pursu ant to a resolution adopted collectively by all\ncreditors and also in accordance w ith the rules set out in separate insolvency laws or a framework\nagreement (CRA). Therefore, there is no room for Ar ticle 18 to come into play in such insolvency\nproceeding.\n\n Finally, in response to the Panel question, Ko rea confirms that the restriction set forth in\nArticle 18 is imposed only when publicly-funded financ ial institutions intend to provide “new loans”\nto unsound companies. Such restriction does not appl y when the financial institutions are engaged in\n\nother activities, e.g., when a publicly-funded bank inte nds to collect existing loans, the requirement\nunder Article 18 does not apply.\n\n119. After the spin-of that led to the creation of DSME, what happened to the debt and assets\nleft behind with DHI? Who were the creditors and owners of DHI after the spin-off and what\npercentage did each hold of the total debt and (negative) equity, respectively, of the post-spin-off\nDHI? What was the ultimate disposition of this debt and equity? What if any impact did this\nhave on DSME and DMI?\n\nResponse\n\n(1) The post-spin-off status of debt and assets left with DHI\n\n After the spin-off in October 2000, DHI h as been selling assets and collecting debts from\ndebtors (mainly Daewoo affiliates). With the proceed s of such sales and debt collections, DHI has\ncontinuously repaid debts to its creditors. As of 31 May 2004, DHI has repaid KRW 260 billion to the\ncreditors.\n\n(2) Creditors and shareholders of DHI after the spin-off (as of December 2000)\n\n (Unit: 1,000 shares, billion won)\nName of shareholders\n* Numbers of Shares\n(percentage) Name of creditors Amount\n(percentage)\nDaewoo Corporation 68,426(24.8%) KAMCO 1,722.3(39.7%)\nKDB 32,254 (11.7%) KDB 138.8(3.2%)\nWoo Chung Kim 22,814(8.3%) Korea First Bank 116.8(2.7%)\nDaewoo Electronics 17.091(6.2%) Korea Exchange Bank 182.6(4.2%)\nDaewoo Precision 4,065(1.5%) Daehan ITC 120.5(2.8%)\nGeneral Public ** 131,134(47.5%) Other minority creditors *** 2,051.6(47.4%)\nTotal 275,784(100%) Total (borrowings) 4,332.6(100%)\n\n * The shares of DHI were traded on th e stock exchange after spin-off until\n23 May 2001. As a result, the shareholders changed and the current shareholders\ncomprise: KDB (1.45 per cent) and genera l public/minority shareholders (98.55 per\ncent).\n\n ** General public includes numerous minority shareholders each of which holds only\nfractional shares in no event more than 1 per cent of the total shares.\n\n *** Minority creditors refer to small credito rs each of which has outstanding loans of less\nthan 1 per cent of the total borrowings.\n\n(3) Plan for the ultimate dispos ition of DHI’s debt and equity.\n\n DHI will continue to carry on debt repayment activities until the end of 2004. Thereafter, DHI\nand its creditors would discuss the possibility of petitioning for bankruptcy proceeding in order to\ndispose of DHI’s remaining debt and assets.\n\n(4) Impact on DSME and DHIM (machinery company)\n\n There is no particular impact that the ultimat e disposition of DHI’s debt and assets may have\non DSME and DHIM.\n\n120. Please comment on the EC’s observation that the fact that 210 financial institutions\nsigned the Corporate Restructuring Agreement in less than one week suggests that they were\ninduced to do so by the Government of Korea.\n\nResponse\n\n The workout framework was not created over such a short period of time as alluded by the\nEC. As early as in April 1998, the Korean banks be gan to study a coherent framework of the workout.\nAt the same time, a task force carried out a more in-depth study of the basic concept of workout.\n\n On 19 June 1998, the basic concept and struct ure of the Corporate Restructuring Agreement\n(CRA) as the framework agreement for workout was explained to 28 banks and financial institutions.\nBetween 19 June and 24 J une 1998, an intense process of co mmenting and negotiations took place\namong the financial institutions through their tr ade associations. On 24 June 1998, 33 financial\ninstitutions and associations representing all different financial sectors had the final negotiations and\nagreed to the final draft of the CRA. These represen tatives also set 25 June 1998 as the effective date\nof the CRA. Thereafter, the final draft of th e CRA was sent through their respective sectoral\nassociations to all individual financial institutions for review and signature. The financial institutions\nreviewed the draft CRA and signed it of their own vo lition. Due to the complexity of such review and\nsigning procedure, the signed versions of the CRA were collected over a considerable period of time\neven after the effective date of 25 June 1998. At that time, nobody knew exactly how many financial\ninstitutions would sign the CRA, and it eventually tu rned out that 210 financial institutions signed it.\nThe above negotiation procedures followed by the fi nancial institutions were reasonable given the\ncomplexity and urgency of the matter. Moreover, the CRA was merely a “framework” agreement\nwhich did not in itself pose any substantive controversial issues (see Exhibit EC-42, Corporate\nRestructuring Agreement).\n\n More importantly, at that time, there was a consensus among the financial institutions that,\nwithout a systematic framework for debt workout in place, the conditions of financially unsound\ncompanies would be aggravated and the creditor financial institutions’ po tential exposure to non-\ncollectible debts will rapidly increase. Therefore, negotiating this workout framework agreement in a\nswift manner served the common interest of the financ ial institutions. In addition, as a general matter,\nthe CRA was an implementation of the so-calle d London Approach. This provided a commonly\naccepted international basis that gave the instituti ons a general comfort level regarding the CRA and\nletting them focus on the details of its implementation.\n\n121. Regarding the Daewoo workout, were any studies commissioned by creditors regarding\nthe relationship between the going concern and liquidation values of Daewoo, other than the\nArthur Andersen report? In particular, were an y such studies commissioned by any creditors?\nPlease provide copies of any such studies commissioned by any of the creditors.\n\nResponse\n\n As far as the Government of Korea is aware, other than the Arthur Andersen report, there was\nno study commissioned by any creditor (whether domestic or foreign) of DHI.\n\n122. Please comment on the EC’s argument (paras. 257 of the EC’s First Written\nSubmission) that DSME assets ‘should also have assumed 55 per cent of the negative net worth\nleft behind’ in DHI.\n\nResponse\n\n The EC failed to clarify why it believes that DSME should have assumed 55 per cent of the\nnegative net worth of the remaining DHI. The EC’s argument seems to be ba sed on its belief that the\n\nspin-off structure whereby DHI was divided into 3 companies was wrong and that, instead, DHI\nshould have been spun-off into only two operating companies in the proportions of [BCI: Omitted\nfrom public version], respectively\n\n The DHI workout plans had been devised as a single global package to seek maximum\nrecovery of debt on an aggregate basis and, thus, th e issue of benefit can not be analyzed on the basis\nof individual components of the workout plan as if each such component constituted a discrete act of\nfinancial contribution.\n\n Moreover, the EC’s assumption that the DHI spin-off should have followed only two-\ncompany approach has no reasonable basis. Ther e are no multilaterally agreed rules on insolvency.\nEven within the EC there are many models. The only common element is determining what the best\nmethod for maximizing value recovery by the cred itors is. In its 1999 report, Arthur Andersen\nestablished that a 3-company approach was a more advantageous alternative than the 2-company spin-\noff for the creditors ( See Exhibit Korea – 120\n, section VIII. 2.2.2, pp. 89-90). The EC has failed to\nprove that the 2-company approach was more beneficial to the creditors.\n\n Furthermore, in the case of DHI, the negative ne t worth of the remaining DHI was a result of\ntrade receivables of Daewoo Motor and Daewoo Cor poration that had been inserted into the DHI\nbalance sheet and had no direct or indirect relationship with the production and sale of commercial\nvessels (See para. 256 of the EC’s First Written Submissi on). Therefore, there was no rational basis\nfor attributing the negative net worth of the remaining DHI to the shipbuilding operations of DSME.\n\n123. Was Arthur Andersen / Anjin’s determination that the going-concern value of DHl\nexceeded its liquidation value premised (at least in part) on the enactment of Article 45-2 of the\nSpecial Tax Treatment Control Law? In other words, was the KRW 236 billion tax measure\ntaken into account by Arthur Andersen /Anjin in its analysis? Please explain.\n\nResponse\n\n The Arthur Andersen’s determination of th e going concern value and the liquidation value\nwas not premised on the enactment of Article 45-2 of the Special Tax Treatment Control Law\n(“STTCL”). There is no indication in the Arthur A ndersen report that Arthur Andersen took into\naccount any spin-off-related tax in its analysis.\n\nE. SERIOUS PREJUDICE\n\n124. On factors influencing ship prices, Ko rea argues that high freight rates are not\nparticularly important at present, in view of the fact that currently the ship market ‘is a buyers’\nmarket’. Korea’s Drewry Report states that “workload shortage or overcapacity” are important\ndeterminants of price: “… yards that are short of work may prefer to take a lower price rather\nthan have under-utilised capacity’. This representation by Korea’s consultant would seem to be\nconsistent with the EC’s argument that excess capacity (in the Korean industry, supported by\nalleged subsidies) is a key factor behind the pr ice suppression/depression it alleges, In other\nwords, both sides seem to agree that excess capa city can drive down prices. Please comment on\nthis specific point.\n\n (The Panel recognizes that the parties dis agree with respect to wh ether Korean capacity\nis ‘excess’ and whether the restructuring that kept the Korean shipyards in operation was\nsubsidized, so it is not necessary to comment on that aspect.)\n\nResponse\n\n Korea considers that shipbuildin g prices are the result of a number of factors, none of which\nalone determine price levels for vessels. Rather, it is all the factors in interaction which determine\nsuch price levels. It has consistently argued that for the determination of whether alleged price\ndepression or suppression is the effect of the subsidi es which are claimed to exist, the existence and\neffect of all of these factors in combination must be taken into account, fa iling which a distorted or\ninaccurate picture is yielded of how the shipbuilding market evolves in terms of prices.\n\n Korea has indicated that capacity is indeed one of the factors that influences prices, but\nmaintains that this is only one of the factors and th at it cannot be looked at in isolation from the other\nfactors to assess why any price trend occurred. In Paragraphs 524 to 527 of its First Written\nSubmission, Korea has confirmed that ship prices ar e deeply influenced by the interaction of supply\nand demand. It stated that demand means the dema nd/order including price requirements made by the\nshipowners who will take the tre nd in freight prices into account in formulating their requirements.\nOn the supply side, Korea has indicated that wh ether there is any overcapacity and how production\ncosts develop are the two main factors influencin g price levels. In addition, however, Korea has\nindicated that other factors as well may greatly infl uence the price level of vessels. These relate to\nproductivity improvement, insufficient workload or other factors specific to particular shipyards\nincluding expertise in designing and building certain types of vessels, payment terms, slot availability\nand delivery time.\n7 Korea maintains its position that the assess ment of the causal link is fact-driven\nand that all factors must be assessed in a comprehensive matter on a case-by-case basis.\n\n This is no different from the position expr essed by Drewry in Exhibit Korea – 70 in\nSection 3.6 when it states that “[p]rices in the shipbuilding market have always been volatile\nreflecting the influences of a variety of supply a nd demand side factors”. Drewry considered the\nfollowing factors, i.e.:\n\n (i) Drewry concurred with the factors id entified in the OECD report of March 2003 on\n“Recent Newbuilding Price Developments”, i.e. shipbuilding orderbook, metals\nprices index, freight rates and exchange rates which are considered.\n\n (ii) Drewry nevertheless considered that the OECD did not list all relevant factors and\nindicated that the following should also be considered:\n\n - as regards supply side factors, workload shortage or overcapacity which may\nlead a yard to prefer to take lowe r prices rather than having under-utilized\ncapacity; and\n\n - as regards demand side factors, size, delivery date, payment terms, build\ntimes, speed – engine and hull form variations and manoeuvrability, hull\nstrengthening e.g. for ice operation, e quipment specification (brand name vs\ngeneric equipment), paint & coatings, innovative design, regulator (class and\nship register), freight rates.\n\n The EC itself during the First Substantive Meeting denied that it was looking at just capacity\nin its assessment on the existence of a vector wher eby the alleged subsidies could have caused price\nsuppression or depression. The EC, in the opinion of Korea correctly, indicated that the assessment on\ncausation must include a multi-faceted approach.\n\n7 This approach is also reflected in Step 2 of Korea’s proposed method to determine the degree of\nsuppression or depression in response to the Panel’s Question 91(d) (at pages 46 and 47 of Korea’s responses to\nthe Panel’s questions) and in Korea’s response to the Panel’s Question 102 (at pages 55 and 56 of Korea’s\nresponses to the Panel’s questions).\n\n In line with the above, Korea considers that the EC has still not given a clear response on how\nalleged over-capacity would necessarily affect price levels. Having indicated itself that several factors\nin relation to supply and demand determine the pric es of the commercial vessel s in dispute, the EC\nhas nevertheless failed to assess each of these factors and their effect on price levels and, as a result,\nhas failed to demonstrate that the alleged subsidies themselves had price depression or suppression for\ntheir effect because of the existence of overcapac ity as a vector. In fact, the EC has failed to\ndemonstrate that the alleged restructuring subsidies caused overcapacity capable of influencing prices.\nThe EC seems to presume that, in the absence of th e alleged restructuring subsidies, the shipyards\nDaewoo, Halla and Daedong would ha ve disappeared. But, as mentioned by Korea, nowhere in the\nworld does insolvency ipso facto lead to termination and sale for scrap and, in the cases at issue all the\nless since the EC itself has pointed out that there we re possible acquirers such as NHI for the yards in\nquestion. In addition, the EC itself has shown in its Attachments EC-2 and 6 to its responses to the\nPanel questions that these three yards in each like product type of vessels did not occupy a market\nposition so as to be able to create significant price depression or suppression. In this regard, Korea\nrefers to paragraphs 251 to 259 of Korea’s Second Written Submission.\n\n125. (a) The list of factors identified in the Drewry Report as determinants of ship price\nincludes freight rates, delivery date/build time (which would s eem to be related\nto capacity and thus supply and demand), and payment terms (which would\nseem to be related to financing). Drewry does not refer to any measure of the\naggregate level of demand as such. Please explain.\n\nResponse\n\n Drewry considers that the trend in demand for each like product separately is one of the\nfactors that contribute to the relevant price level for the product considered. However, as mentioned in\nSection 1.2.2 of the Drewry report, considering only that price will vary directly in line with demand\ndoes not go far enough as there are many other demand and supply-related factors that contribute to\ndetermining the price level for any like product. In Section 1.2 of Exhibit Korea – 70, Drewry\nidentifies a range of factors that are considered to have an impact on ship price, i.e.:\n\n• External factors (para 1.2.1)\n - Freight rates\n - Exchange rates\n - Metals prices index\n• Supply side (para 1.2.2)\n - Workload shortage or overcapacity\n• Demand side (paras 1.2.3 and 1.2.1)\n - Size\n - Delivery date\n - Payment terms\n - Build time\n - Shipbuilding orderbook\n - Speed and manoeuvrability\n - Hull strengthening\n - Equipment specification\n - Paint & coatings\n - Innovative design\n - Regulatory: Class and Ship Register\n\n While the aggregated supply-demand balance is, th erefore, clearly a factor which affects price\nin the shipbuilding industry, Drewry considers that it is not the only or dominant factor. Applying the\nsimple economic concept of supply-demand bala nce, however, encounters some problems in\nshipbuilding, primarily:\n\n• the difficulty in quantifying shipbuilding capacity (as opposed to historical output levels)\n• the fact that this capacity is not all dedicated to merchant shipbuilding and may also be in\nused for naval shipbuilding, ship repair and conversion and offshore structure construction in\nparticular\n• the lack of homogeneity in aggregate demand (primarily due to different ship types and sizes)\n• the lack of homogeneity in aggregated supply due to the size capability of yards’ facilities and\nthe experience base regarding ship types that they have experience in building.\n\n The result is that whilst demand may be able to be categorized according to size and type of\nvessels, supply cannot rigorously be divided on th e same basis and so there is considerable non-\nhomogeneity within the supply-demand balance.\n\n (b) Also, in discussing Korean cost adva ntages on the supply side, Korea does not\nrefer to cost of debt service/interest expenses. Please explain.\n\nResponse\n\n Debt service costs tend to be specific to a par ticular yard’s situation, both in terms of the\nstructure of its financing of capital assets and also it s working capital requirements. It is, therefore,\nnot possible to take general economic indicators to estimate the relative cost advantages or otherwise\nof different yards in this respect. For example, in the EC there are many long established yards whose\ncapital cost of facilities has long since been amortized and any interest on debt related to this will also\nhave gone. Debt service costs related to facilities ar e, therefore, likely to be those associated with\nimprovements and modernizations. In general terms, there has been a lower level of modernization at\nEC yards, but exceptions to this are to be found in the passenger shipbuilding yards and most\nparticularly in the former East German yards like Aker MTW and Kvaerner Warnow Werft. In these\nyards the modernizations were state funded and then when the yards were privatized the new owners\ninherited the new facilities at a fraction of the investme nt costs – in this situation, the debt levels and\nhence debt service costs are driven by very specific circumstances which does not make for easy\ncomparisons.\n\n However, the area where Korea has significant cost advantages fo r such costs is in terms of\nthe scale factor of its production. Firstly, debt service costs are supported by high workload volume\nthroughputs and as such on a basis of output units th e cost per unit will be lower than for smaller\nyards.\n\n This is particularly relevant in the case of financing of facilities and capacity where the capital\ncost of providing 1,000 cgt of capacity will be fa r lower than in smaller capacity yards. The\nFigure 8.1 in Exhibit – Korea 70 gives an indicatio n of the throughput scale differences between EC\nand Korean yards, particularly recognizing that most of the bigger EC entries are in fact groups\ncomprising more than one yard.\n\n A good example of the economies of scale is evident from the exam ple of LNG-specific\ninvestment. As highlighted in the KPMG report submitted as Exhibit Korea – 108, FMI assessed that\na European yard would need to cover the investme nt burden of LNG specific investment over a series\nof 3 LNG ships but subsequently changed its estim ates for Daewoo to recovery over 10 ships, to\nreflect the higher throughput volumes of such v essels at the Korean yard. By the end of 2002,\nDaewoo had in fact received orders for 21 LNG ve ssels and so its capital expenditure and any debt\n\nservice cost associated with this is likely to be mu ch lower than any European yard with only short\nseries builds.\n\n In respect of working capital requirements and the debt service costs of these, the Korean\nyards are considered to operate at an advantage to EC yards in this respect in view of the generally\nbetter cash flows achieved by their more front-end loaded contract payment instalments.\n\n Therefore, Korea submits that the EC has not shown that debt service costs/interest expenses\nof the allegedly subsidized Korean yards have incurre d such an increase over the years as to offset the\ndecrease in costs that was shown in the Drewry report in Exhibit – Korea 70. And, in fact, as\nmentioned above, the debt service costs and interest expenses, as confirmed by the EC’s expert, FMI,\nhave shown a decreasing effect due to their sp read over a greater throughput. Thus, Drewry’s\nconclusion stands: the decrease in Korean costs of production is clearly greater than the decrease in\nprices of the vessels concerned.\n\n126. Korea seems to imply that shipyards special ize in producing certain kinds of ships. If a\ngiven Korean shipyard has no history of producing, for example, ferryboats, could this be the\nbasis for concluding that that shipyard cannot produce them? Please explain.\n\nResponse\n\n The fact that a national industry or individual shipyard does not produce a particular type of\nship, does not necessarily mean that it is physically or technically incapable of building that type of\nvessel. The reality is that there is a range of factors which places limitations (physical, economic and\ntechnical) on the shipyard such that it is either not economically viable for the yard to build them or\nthat it does not have credibility as a competent builder in the customers’ eyes.\n\n The following are the main factors imposing limitations:\n\n• ship size – the shipyard has to have buildi ng locations big enough to build the ship in\nquestion, this includes the height of lift for cranage and or headroom clearance in covered\nbuilding berths for ships with very high superstructures;\n\n• specialist facilities or skills – for certain ty pes of vessels specialist facilities are required\nwhich must be provided in the shipyard or some times from a supplier or sub-contractor. Ship\ntypes that are generally recognised to have such requirements include:\n\n- Cruise ships: skills for the installation of glass atriums and interior decoration; high\nvolume of modular cabins, highly complex interaction of specialist sub-contractors;\n\n - Ro-Ro ships: skills to install the water tight bow and stern doors and associated ramps;\n\n - Chemical tankers: some chemical tankers include tanks made of stainless steel which\nrequires special welding equipment and welding skills;\n\n - LNG ships: ability to construct the special containment gas containment tanks or to\nlift in and install such tanks made by su b-contractors; high levels of insulation\n‘boxes’ required to insulate the tanks; sk ills in the installation of steam turbine\nengines which are rarely used in other me rchant ship types; and most recently gas\nturbines and dual fuel engine arrangements;\n\n - FPSO and drill ships: skills in the installa tion of what is referred to as the ‘topside’\nequipment for these vessels involved in seabed oil extraction and storage; specialist\nmooring and pipeline connections for loading and unloading cargo;\n\n - Fast ferries: skills and facilities for construction of the aluminium hull and\nsuperstructure which requires specialised welding facilities and skills and sometimes\nhull jigs;\n\n - Tankers: although less dramatic, tankers of most kinds have much higher levels of\npipework and valves so a shipyard buildin g tankers must have superior pipeshop\ncapabilities and facilities in-house or by sub-c ontract than those building other ship\ntypes.\n\n Shipyards tend to have a range of ship typ es and sizes which they produce and for which they\ngain a reputation in the marketplace with customers and hence they will focus their marketing efforts\non these ship types and sizes. These are ship typ es and sizes in which they can be most cost\ncompetitive and where they have good customer credib ility in terms of design, price, and delivery.\nThrough a combination of self-selection and custom er selection they focus on market sectors where\nthey can maximise their competitive advantage.\n\n This is not to say that they cannot move into other markets that are within their physical\ncapability but to do this they will have to be ab le to hone their productivity; offer good designs and\nwill need to build customer awar eness in their competence and compe titiveness in this market. They\nwill recognize that yards already well established a nd active in these markets will have an advantage\nover them initially.\n\n The fact that yards specialize in specific lik e product vessels can be shown for yards all over\nthe world including for Japanese and Chinese yards but also for the EC yards as is demonstrated\nbelow. The data covers the same timescale of deliveries or orders from 1990 and records the\ninvolvement of 290 EC yards across all ship types over that time:\n\n• General Cargo and Multi-purpose ships: 75 EC shipyards (or shipyard groups if not\nreported at yard level) have been involved in this sector so there has been plenty of\nparticipation with 771 vessels involved. But th ere has been no involvement by any the IZAR\nyards in Spain; any of the Fincantieri yards in Italy, Chantiers de l’Atlantique, Odense, Aker\nMTW, HDW, Lindenau, Kvaerner Masa Yards. The major yards involved have been Damen\ngroup, Peters Scheepswerf, Ferus Smit, Bodew es and Vollharding of Holland and JJ Sietas of\nGermany which have built 347 of the 771 ships.\n\n• Bulk Carriers: 39 EC shipyards have been involved in this sector involving 154 ships but\nthere has been no involvement from Chantiers de l’Atlantique, Odense, Aker MTW, Kvaerner\nWarnow Werft, Volkswerft, HDW, Lindenau, Kvaerner Masa Yards and only two built at\nIZAR group yards. Fincantieri yards however we re involved with 16 of the 154 vessels. The\nmarket leader in this sector is Japan where 2, 152 ships were involved followed by China with\n454 ships. So any lack of involvement seems unlikely to be connected to Korean yards.\n\n• Container Ships: 51 EC shipyards have been involved in this sector involving 693 ships but\nparticipation has varied dramatically by size of vessel. Whilst 39 yards were involved in\nbuilding container ships of <1,000 teu, only 5 ya rds were involved in building container ships\nof 3,500 teu and above; 21 yards were i nvolved with building mid range vessels of\n1,000<3,500 teu. Kvaerner Masa Yards and Ak er Finnyards of Finland and Chantiers de\nl’Atlantique of France did not participate in this market at all, whilst in Spain, IZAR groups\nyards built just 10 and Union Naval Valencia built another 2; and in Italy Fincantieri yards\n\nwere the only ones to participate with 9 vessels. The concentration of containership building\nwithin EC lies with the German yards, Dutch yards (for ships on less than 1,000 teu only) and\nwith Odense of Denmark.\n\n It is evident that the shipyard supply market within the EC is far fr om homogenous and some\nshipyards have a particularly strong focus on certain size or types of vessels, i.e.:\n\n• Damen Shipyards group of Holland built 251 ships dur ing the period of which 194 were\neither Tugs, General Cargo or Multi-purpose Cargo ships.\n\n• Lindenau Shipyard in Germany where 21 of the 24 vessels with which it was involved\nduring this period were Chemical Tankers.\n\n• Odense Shipyard in Denmark, where 59 of the 76 vessels were container ships.\n\n• Chantiers de l’Atlantique in France, where 32 of the 47 ships were Cruise Ships.\n\n• Kvaerner Masa Yards where out of 54 ships, 25 were Cruise Ships, 9 were Ferries and 8\nwere Offshore.\n\n• Aker Finnyards where out of 41 ships, 20 were either Cruise, Ferry or Passenger ships and\nanother 4 were Reefers ships and 3 were RoRos.\n\n• Smaller Italian Yards: Morini where 13 out of 20 ships were chemical tankers; Orlando\nwhere 10 out of 14 ships were chemical tankers ; de Poli where 10 out of 20 were chemical\ntankers and another 7 were LPG ships; Rodriqu ez where 18 out of 29 were ferries and 6 were\npassenger ships; SEC where 16 out 24 were chemical tankers and 5 were Ro-Ros; Visentini\nwhere 14 out of 25 were Ro-Ro and 11 were ferries.\n\n• Smaller Spanish Yards: Armon group where 47 out of 91 were fishing vessels and 43 were\nTugs; Zamacona where out of 55 ships 36 were Tugs and 9 were fishing vessels; UN\nValencia where out of 45 ships 23 were Tugs a nd 9 were chemical tankers; Freire where 21\nout 27 ships were fishing vessels; Gijon Naval where out of 14 ships, 7 were fishing vessels\nand 7 were chemical tankers; Cies where 10 out of 11 were fishing vessels; Barreras where 11\nout of 31 were fishing vessels, 9 were Vehicle Carriers and 6 were Ferries; Balenciaga where\nout of 16 ships 7 were fishing vessels and 6 were Tugs; de Huelva where 23 out of 35 were\nfishing vessels.\n\n• Small Dutch Yards: Peters Scheepswerf where 57 out of 60 ships were General Cargo;\nBodewes were 26 were Gene ral Cargo and 22 were Multi- purpose Cargo (MP Cargo);\nVollharding where 25 were MP Cargo and 17 were General Cargo out of 63 ships; Tille\nwhere out of 22 ships 10 were Containers a nd 9 were MP Cargo; IHC Holland where 48 out\nof 51 ships were Dredgers; K Damen where 13 out of 20 were chemical carriers;\n\n We believe that the above demonstrates that th e supply side of the shipbuilding market is far\nfrom homogenous and that yards do tend to speciali ze in certain types and sizes of vessels. The\nreasons for this may relate to facility limitati ons, but may also be driven by the yards own\nappreciation of the sectors that it has the best co mpetitive advantage in or by customers’ views on\ntechnical competence and competitiveness for certain ship types.\n\n127. In relation to the EC argument that the restructured yards pulled down prices of all\nother Korean yards, Korea asks the rhetorical question. Why stop there? Why not also blame\nChinese or Japanese shipyards, if Korean subsidies triggered a price war? Is Korea’s argument\n\nthat, if a global price war has been set off by a particular player in the market, that player\nshould rot be deemed to be responsible becau se other players have followed its lead? Please\nexplain.\n\nResponse\n\n At the outset, Korea must note that the whole issu e of price leadership is a difficult one in this\ncase because the EC has dropped its claims of price undercutting. Normally cases can be expected to\nbe built upon several possible elements of proof. Th e EC has chosen to avail itself of only price\nsuppression or depression as is permitted under the treaty. However, simply because the treaty\nlanguage permits of such a finding, that does not mean that it is a simple or even a normal thing to\ndemonstrate adverse trade effects based on a single element of proof. In this dispute, the EC has\nexplicitly rejected proving such other elements as price undercutting because, as the EC stated at the\nFirst Substantive Meeting, it could not meet the elements of proof of, for example Article 6.5. The EC\nhas now tried to demonstrate price undercutting in a nu mber of situations and attempted to claim that\nthere is a difference between using price undercuttin g as a primary element of proof and using it to\nsupport price suppression or depression. This is fal se logic and a fatal legal flaw in the EC’s\nargument. It has chosen to try to build a case without reference to the interrelated elements of proof; it\nis legally precluded from attempting to reintroduce them in another guise.\n\n Keeping in mind the difficulty of identifying exactly what is meant by price leadership in\nlight of the preclusion of arguments based on pri ce undercutting, Korea considers as a general matter\nthat it is possible for a single company to be a price leader. However, there are a number of\nqualifications to this statement. First, it must be sh own that the price leadership is the effect of the\nalleged subsidy. To simply say that a company’s products were price leaders is legally meaningless in\nthe light of the treaty language of Article 6.3(c).\n\n Second, regarding the assertions of the EC in pa ragraphs 80-82. Korea strongly objects to this\nline of argumentation. First of all, there is no lega l basis or relevance for asserting that the “Korean\nshipyards” were price leaders. Unless the EC is a lleging a separate geographic market for Korea there\nis no legal basis for lumping all of the Korean yard s together in the manner done by the EC in those\nparagraphs. The EC reiterated that it was not making su ch an argument; therefore, its statements such\nas “Daedong/STX and Samho-HI/Hall-HI are two of four Korean shipyards that control 60 per cent of\nthe market for product/chemical tankers” is legally meaningless. Unless the EC can demonstrate that\nSTX and Halla individually were price leaders as an effect of the alleged subsidies, then the\nstatements including the other yards are pointless. To take an example, if four companies (a\nsubsidized Korean yard, a non-subsidized Korean ya rd, a Japanese yard and a European yard) were to\ncompete for four sales and each obtained one sale, the EC claims that this means that the subsidized\nKorean yards won 50 per cent of the competitions. Ho wever, the non-subsidized Korean yard is in\nprecisely the same position as the EC and Japanese ya rds. Each has a 25 per cent market share and\neach is equally influenced, or not, by the subsidi zed yard. Unless the EC is now implicitly trying to\nput forward some baseless allegations of collusion (of which we have seen no evidence nor heard any\narguments), the mere fact of nationality does not sw eep the other Korean yard s into the subsidized\nyard’s market share. The subsidized yard may or may not be a price leader in this hypothetical, but the\nproof of it will have to stand on the effects of that yard’s subsidy, not through some bizarre nationality\ntheory.\n\n The Panel will recall that when challenged by Korea to defend these statements, the EC\noffered no proof whatever except to revert to some arguments about internal price competition that\nwould arguably be relevant only in the context of an antidumping investigation or a subsidies dispute\nwhere there were separate geographic markets of wh ich Korea was a distinct market. The EC offered\nno actual evidence because it has none. Quite simply, the EC has failed to provide any evidence that\nthe allegedly subsidized yards were the price leaders and were so as an effect of the alleged subsidies.\n\n Korea must also note again for the written record its objections to the way the EC has phrased\nits market share allegations. The EC several ti mes referred to market sh ares of order books. Of\ncourse, those order books stretch over several years and can vary tremendously from yard to yard and\nfrom year to year. Therefore, it is impossible to know actually what the market share is or will be at\nany given time because the comparisons are not of the same time periods. At other points, the EC\nfollows on such statements by making general alle gations about market shares without identifying\nwhether or not it is again referring to order books or some particular year. The EC does not identify\nany particular years. The EC is simply attempti ng to mislead the Panel by trying to disguise small\nshipyards within statistics that include larger shipyards over an unknown period of years.\n\n Korea would also like to recall to the Pane l the extensive information supplied by Korea\ndemonstrating the significant cost advantages of all of the Korean shipyards. It is because of this\nindisputable fact that the EC has rejected its obligation to demonstrate that any alleged price\nleadership is an effect of the subsidization. As Korea pointed out in paragraph 282 of Korea’s Oral\nStatement at the Second Substantive Meeting, th e EC’s continual reference to Hyundai-Mipo as a\nprice leader when Hyundai-Mipo was not restructured and received a very limited number of APRGs\nand pre-shipment loans (even considering the de minimis levels of such credits even under the EC’s\ncalculations) demonstrates conclusively that any price leadership was not pursuant to the alleged\nsubsidies.\n\nII. TO THE EC\n\nA. KEXIM LEGAL REGIME\n\n128. Does a government necessarily provide a s ubsidy if it makes a financial contribution\noutside the normal field of commercial behaviour? Assume a government creates a new special\nfinance mechanism that has never been offered by private banks. Assume that private banks\nsubsequently begin providing the same fina nce mechanism on the same terms as the\ngovernment initially offered, Assuming that th e finance mechanism constitutes a financial\ncontribution, would the initial offer of that finance mechanism by the government confer a\nbenefit? Please explain.\n\nComments\n\n Korea observes at the outset that this hypothetical question is based on an assumption that the\n“government” is providing a particular financial instrument. Particularly in the area of finance, many\nbanks in the developing world (and in some EC member states as well) were set up to provide\ncommercial lending in areas where there was simply a dearth of private sector experience and\ncapability. As an initial matter, it must be determ ined whether these entiti es lending on a commercial\nbasis are public bodies.\n\n Korea assumes from the hypothetical that the Pa nel is positing for simplicity of argument that\nthe finance mechanism is being extended by an organ of government (e.g., the Finance Ministry as per\nQuestion 106). In such a case, the SCM Agreement should not be interpreted as prohibiting the\ngovernment from providing finance instruments that are new to the market. Such a presumption\nwould be unduly constraining on all Members and pa rticularly on developing country Members. A\nlack of an identical financial instrument in a certain period requires that the complainant must use data\nfrom a comparable period or comparable instruments with appropriate adjustments from the same\nperiod as a benchmark to determine whether there is a benefit.\n\n129. The EC submits that KEXIM’s website describes the PSL programme as designed “to\nencourage the export of capital goods such as … ships ... involving larger credits and longer\n\nrepayment terms than what suppliers or commercial banks would provide~” Isn’t this what any\ndevelopment bank does? Do development banks necessarily provide subsidies? Please explain.\n\nComments\n\n Korea would like to note again the oddity of the EC’s argument regarding the status of\nKEXIM as based on credits of longer terms. This dispute is about extremely short term instruments.\nThe EC also claims that KEXIM could offer larger amounts of credit, but the evidence is quite clear\nthat the programmes in question were no larger in size than what commercial banks were willing to\nprovide. Thus, the “evidence” that the EC offers cuts against its per se argument and also undermines\nany implication regarding governmental authority regarding the programmes in question (please refer\nto the answers to Questions 106 and 107, above).\n\nB. APRG/PSL\n\n130. Please comment on Exhibit Korea – 87, concerning country risk spreads.\n\n131. Why, in its benefit calculations for KEXIM financing did the EC apply the S/M credit\nrating to DSME for the entire period for wh ich calculations are presented including in\nparticular the post-restructuring period? Is it the position of the EC that DSME remained\nuncreditworthy even after the restructuring? Please explain.\n\nComments\n\n This is an example of the EC’s false accu sations against Korea permeating throughout this\nproceeding. While Korea will not reiterate its review of the fallacies of the EC’s attempt to equate\nKEXIM credit ratings and other rating agencies’ rati ngs (for the details with this respect, please refer\nto Exhibit Korea – 91), Korea would like to point out that KEXIM as well as other credit rating\nagencies adjusted DSME’s credit rating upward ri ght after its graduation from the workout (s ee\nExhibit Korea – 92), having found that DSME’s creditworthiness had improved through the workout\nexercise. Despite this, the EC baselessly treated DS ME as being continuously in the worst financial\nsituation. The EC’s intent for doing so is quite evident. By falsely rating DSME’s creditworthiness,\nthe EC wished to prove the existence of a great benefit conferred on DSME.\n\n132. Please comment on Korea’s assertion that the co llateral offered in respect of certain APRGs\nprovided by foreign banks covered only a small portion of the guarantee” (para. 81 of Korea’s oral\nstatement at the Second Substantive Meeting).\n\n133. At para. 105 of its Second Written Submission, the EC states that only domestic banks with\n“government association’ provided APRGs to Samho. Regarding Figure 12 of the EC’s First Written\nSubmission, is Chubb a domestic bank? If so, does it have a “government association”? If there is\nsuch an association, what is its nature? Please explain,\n\n134. In Exhibit EC-118, PWC asserts that “ [t]he KSDA Bond Matrix is the accepted mark-\nto-market price for the domestic market”. Does this mean that the EC disagrees with Korea’s\nargument that the bond matrix represents hypothet ical I projected rates, or does the EC accept\nKorea’s argument but consider that the inde x nevertheless constitutes a reliable market\nbenchmark? Please explain. What does market-to- market in this context mean? In particular,\nwho was marking what to which market?\n\nComments\n\n As detailed in Korea’s Response to Panel Question 73, the KSDA bond rates are not the\nactual rates (or yields) of a specific corporate bond instrument, but simply a general index which\n\nshows daily market trends or changes. As such, cons iderations as to industry sectors, issuers or terms\nand conditions for each instrument are not taken into account. Korea submits again that companies\nwith the same credit ratings are perceived and treated differently in the market. As stated in paras 88\nthrough 92 of the second Oral Statement by Korea, it would make no sense to maintain that general\nbond indices are somehow better than using financial instruments that the firms under examination\nactually used. Korea submitted Exhibits Korea – 18 through 22 as to financial instruments actually\nused.\n\n135. Korea criticizes the EC for having used in its benefit calculations the 1-year bond price index\ninstead of the 6-month index. Why was the 1-year index used? What is the effect on the EC’s\ncalculations of using the 6-month index?\n\n136. At para. 95 of its oral statement, Korea presents a number of points criticizing the EC\ncalculation methodology, and states that further details are contained in Exhibits Korea 90-102. Please\nrespond to Korea’s criticism in detail, including with reference to the content of these exhibits.\n\n137. Korea submitted evidence (in response to Qu estion 74 from the Panel) that KEXIM reduced\nthe credit risk spread for HHI to [BCI: Omitted from public version] . Did the EC apply this [BCI:\nOmitted from public version] credit risk spread in the relevant part of its PSL analysis? Please refer\nto the relevant calculations where this adjustment was made.\n\n138. The EC does not appear to have answered Questions 9 and 11 from the Panel. The EC’s\nreplies referred the Panel to the EC’s reply to Question 8. That reply, however, focuses on KEXIM’s\n“practice” of providing APRGs and PSLs, without identifying the APRG and PSL programmes “as\nsuch and without explaining how (if at all) they differ from the KEXIM legal regime “as such”. Please\nprovide full answers to Questions 9 and 11.\n\n139. The Panel refers to Attachment 5 to the EC’s replies to the Panel’s questions after the First\nSubstantive Meeting, which contains transaction-specific alleged benefit calculations for one PSL and\none APRG. Please make the same calculation for each of the APRGs and PSLs at issue in these\nproceedings. In other words, for each shipyard, specify which AFRG I PSL relates to either LNG,\nproduct / chemical tankers, or container ships, and specify the amount of the alleged benefit as a % of\nthe ship price. Please attach detailed worksheets.\n\n140. Please comment on Korea’s argument that KEXIM PSLs are made “at rates far higher\nthan those the government has to pay for the funds so employed” (para. 277, Korea’s First\nWritten Submission).\n\nComments\n\n Korea refers the Panel to para 112 of Ko rea’s Second Written Submission which shows the\nKEXIM cost of funds for the relevant period.\n\nC. ALLEGED ACTIONABLE SUBSIDIES\n\n141. Para. 215 of the EC’s First Written Submi ssion states that “Daewoo” benefited from a\n236 bn tax exemption alleged to be a subsidy. Para. 226 then refers to alleged benefit to\nDaewoo-SME”. Para. 232, however, refers to be nefit to “Daewoo-HI / Daewoo-SME”. Please\nindicate precisely which legal entity received / benefited from the alleged tax concession.\n\nComments\n\n See Korea’s response to Panel Question 116.\n\n142. In percentage terms, how much of the alleged benefit resulting form the “Daewoo” tax\nconcession should be attributed to DSME’s production of (i) LNGs, (ii) product / chemical tankers,\nand (iii) container ships? Please attached detailed worksheets.\n\n143. Is it the EC’s argument that the tax exem ption was determinative in the decision to\nmaintain Daewoo’s shipbuilding operations as a going concern, rather than liquidating them? If\nso, where is this reflected in the Arthur Andersen/Anjin report or in other documentation\nbefore the Panel?\n\nComments\n\n See Korea’s response to Panel Question 123. There was no tax exemption of KRW 236\nbillion. Further, no tax exemption was reflected in the Arthur Andersen report.\n\n144. Para. 162 of Korea’s second oral statement refers to creditors rejecting the initial DHI\nworkout proposal. Were such creditors included in the EC’s claim of government entrustment or\ndirection? If they were entrusted or directed by GOK, why / how did they reject the initial workout\nproposal?\n\n145. The EC requests an adver se inference regarding Korea’s alleged failure to provide a copy of\nthe workout plan / report submitted by KDB on 24 November 1999. Please comment on the\nexplanation set forth at pans 194 and 195 of Korea’s second oral statement. If the EC still maintains\nits request, what is the legal basis for that request ? Why does the EC consider that Korea should have\nmade this report available to the EC / Panel earlier?\n\n146. In response to Question 23 from the Panel, the EC asserts that “[t]he existence of a going\nconcern analysis can be an indicia that a hypothetical private creditor would have acted in the\nsame manner” Does the EC accept that the i ndividual components of the Daewoo wrkou1 can\nbe assessed on the basis of the Arthur Andersen report? If the Panel rejects the EC’s argument\nthat the Arthur Andersen report incorrectly determined that the going concern value of DHI\nexceeded its liquidation value, does this necessar ily mean that the Panel should reject the EC’s\nclaims regarding the individual components of the workout? Please explain.\n\nComments\n\n As stated in Korea’s res ponse to Panel Question 122, the DHI workout plans had been\ndevised as a single global package to ensure maximum recovery of debt on an aggregate basis and,\nthus, a benefit cannot be analyzed on the basis of individual components. Therefore, if the Panel\naccepts that the creditors acted pursuant to market pr inciples when they chose the workout rather than\nstraightforward bankruptcy (liquidation), the Pane l should reject the EC’s claims regarding the\nindividual components of the workout.\n\n147. The EC asserted at the second meeting that cr editors should have got more out of the Daewoo\ndebt/equity swap. How could creditors have got more? Who / what benefited from the fact that they\ndid not?\n\n148. The EC proposes an outside investor sta ndard when challenging the reorganization of\nSamho. This contrasts with the position taken by the EC in the GATT case concerning United\nStates – Imposition of a definitive Countervailin g Duty on Imports of Certain Steel Products\nOriginating In France, Germany and the United Kingdom.\n8 Why has the EC changed its\nposition on this issue? Why does the EC now co nsider that the outside investor standard is\npreferable to the inside investor standard? Please explain.\n\n8 Report of the GATT Panel, SCM/185, issued 15 November 1994 (unadopted).\n\nComments\n\n Korea refers to its response to Question 172.\n\n149. If the Panel were to reject the EC’s cl aim of government entrustment / direction of\nprivate creditors, would this mean that tho se private creditors provide a reliable market\nbenchmark for determining whether or not the restructurings at issue conferred a benefit?\nPlease explain. Did the EC address this issue in it s previous written and oral submissions to the\nPanel. If yes, please indicate precisely where it did so.\n\nComments\n\n The EC itself in paragraph 106 of its First Written Submission indicates that Article 1.1 of the\nSCM Agreement distinguishes between “government”, “public body” and “private body” and that the\nconcept of “private body” has been defined negativ ely as “any entity that is neither a government nor\na public body” to ensure that there is no reason for circumvention in sub-paragraph (iv) of this Article.\nIn other words, the EC has acknowledged that Article 1.1 has set up a closed framework of instances\nin which financial contributions may give rise to a subsidy that is either prohibited or actionable under\nthe SCM Agreement. Thus, if a financial contribution is made neither by a government nor by a public\nbody carrying out a government practice nor by a private body acting upon the entrustment or\ndirection of the government, the financial contribution is not\n covered by Article 1.1 of the SCM\nAgreement. One must then logically conclude that nothing distinguishes the financial institutions\nwhich were found not to have acted under government direction or entrustment from any other private\nbodies and that they could as, in any other situa tion, provide a suitable be nchmark for determining\nwhether a benefit existed. In particular , there is nothing in Article 1.1 of the SCM Agreement, explicit\nor implicit, that creates a special category of priv ate bodies which having been considered not to have\nundergone direction or entrustment of the government , would still be set aside as being an improper\nbenchmark to determine whether a financial contribution afforded a benefit. All private bodies that are\nnot under government direction or entrustment need to be treated alike.\n\n In the EC’s own rationale, those financia l institutions that were not operating under\nentrustment or direction of the Government of Korea should be a proper benchmark to assess the\nexistence of a benefit as the EC stated the fo llowing in paragraph 277 of the EC’s First Written\nSubmission:\n\nThe relevant benchmark in the present case is the commercial behaviour of the\nprivate investors that at the same time were creditors of the distressed company. It is\nonly the behaviour of financial institutions /creditors operating outside the scope of\nthe Government of Korea’s pressure that may be considered in assessing whether the\nrestructuring plan for Daewoo-HI/Daew oo-SME was carried out on terms more\nfavourable than those otherwise available in the market.\n The EC also took the position that all financ ial institutions not acting under direction or\nentrustment are the benchmark for assessing the exis tence of a benefit in the response to Question 23\nof the Panel at paragraph 99 of the EC’s responses to the Panel’s questions.\n9\n\n In relying on the actions of creditors that it cl aims to be outside the control of the Government\nof Korea to determine a benchmark for the assessment on the existence of a benefit, the EC itself has\nmade it clear that if domestic financial institu tions do not act under gove rnment entrustment or\n\n9 The same position is expressed in the EC’s response to the Panel’s Question 24 at paragraph 100 of\nthe EC’s responses to the Panel’s questions.\n\ndirection, these domestic financial institutions can be taken as a benchmark for the assessment on\nbenefit.\n\n150. Regarding the EC’s Question 33 to Korea af ter the First Substantive Meeting, please explain\nwhy, if at all, the value of Samho’s construction business is relevant to the present proceedings.\n\n151. Korea asserts that the share of debt held by the foreign creditors who failed to participate in\nthe Daewoo, workout was around [BCI: Omitted from public version] . Is it reasonable to expect a\npanel to condemn a restructuring on the basis of the behaviour of creditors holding only [BCI:\nOmitted from public version] of the debt?\n\n152. Regarding the Daewoo workout, the EC mak es various arguments regarding the purchase of\ndebt and bonds by KAMCO. It is unclear whether these arguments support a separate claim regarding\nthe KAMCO rates, or whether those arguments ar e made in support of the more general claim\nconcerning the use of foreign creditors as the market benchmark. Please explain.\n\n153. Please comment on Korea’s argument (at para. 191 of Korea’s Second Written Submission)\nthat the BC, in its response to Question 22 of the Panel (which concerned the ‘alleged specificity of\nthe corporate restructuring” generally), allegedl y concedes that the Court supervised corporate\nreorganizations undertaken by Halla and Dae dong were not specific “because these companies\nseemed to have disappeared and the BC answers the question only in regards to DHI”.\n\n154. Regarding the STX reorganization, we not e that the debt rescheduling exemption from\ninterest is the sole element identified by the EC when calculating the amount of alleged benefit in\nAnnex 3 of Attachment 1 to its replies to questions from the Panel after the First Substantive Meeting,\nWe further note that the EC’s rebuttal submission does not refer to the other elements of the\nrestructuring identified in its First Written Subm ission, such as the issuance of bonds by Daedong.\nDoes the EC still claim that the other elements of the restructuring including the bond issuance by\nDaedong, constituted a subsidy? If so, why were they not included in the abovementioned\nAttachment 3?\n\nD. SERIOUS PREJUDICE\n\n155. The EC has indicated that the Panel should determine the existence of price\nsuppression/depression separately for LNGs, product/chemical tankers, and container ships.\n\n (a) Does this mean that the EC is aski ng the Panel to issue three separate serious\nprejudice rulings, on LNGs, product/che mical tankers, and container ships,\nrespectively?\n\n (b) If not, please explain\n\n156. In the information before the Panel, including the Annex V information are there\nadditional examples (beyond those already referred to in the EC submissions) of bids by Korean\nshipyards, for which EC shipyards also are bidding, and where in the view of the EC the\nKorean yards have led prices downward.\n\n157. (a) In the information before the Panel, including the Annex V information, are\nthere examples/evidence of instances in which EC shipyards have considered,\nbut declined to, bid due to low preva iling prices? For example, can the EC\nprovide records of instances in which an EC yard was contacted by a ship\nbroker concerning the possibility of bidding, but decided not to do so because of\nlow prices.\n\n (b) In any such instances, does the info rmation before the Panel contain evidence of\nKorean pricing/bidding for the same sale?\n\nComments to questions 157 and 158\n\n The EC itself has refrained from invoking Article 6.3(c) of the SCM Agreement on the basis\nof price undercutting or lost sales which are set fort h in this Article as grounds for challenges separate\nfrom price depression or suppression. Therefore, Korea wishes to reiterate its concern that data on\nbids by EC and Korean yards showing price co mpetition that might have constituted evidence on\nprice undercutting or lost sales cannot now be reintroduced in the framework of this proceeding which\nis not based on price undercutting or lost sales. In addition, even if individual bids showing price\ncompetition were taken into account on the ground previously advocated by the EC during the First\nSubstantive Meeting that there must be a certain am ount of price undercutting in order for there to be\nprice depression, based on Article 6.3(c) itself – as acknowledged by the EC – no price undercutting\ncan be established unless there a strict test determ ining that the vessels in competing bids are “like\nproducts”.\n\n Notwithstanding these reservations, Korea notes that, out of the many hundreds of sales, the\nEC has only submitted data on a few bids in which EC and Korean yards participated that can, at best\nbe qualified as shallow and repetitive since the sa me examples were used throughout the EC’s\nsubmissions. Korea has identified the following:\n\n - the sale by DHI of 2 LNGs to Solaia Shipping and to Repsol and 1 LNG to Bergesen\n(Responses to Annex V Questions, Attachment 4.4(21)-1, Exhibits EC-84, 85, 141,\n142);\n10\n\n - the sale of a container vessel to Hamburg Süd (Exhibit EC-88); 11\n\n - the offer for sale of a product and chemical tanker by EC yard Lindenau in\ncompetition with an unspecified Korean yard and as regards an unspecified\nshipowner (Exhibit EC-89) and the offer for sale of three product and chemical\ntankers by Aker covered in the same Exhibit;\n12\n\n - the offer for sale of a product and chemical tanker by Lindenau for an unspecified\nItalian owner (Exhibit EC-90).13\n\n Korea stresses that these were the only exampl es of actual competing bids referred to by the\nEC since the filing of its First Written Submission.\n\n Even in the Annex V procedure, when the EC had not yet communicated its decision not to\nrely on price undercutting or lost sales, the eviden ce provided on the existence of price undercutting\nor lost sales was scarce and inconclusive.\n\n10 Korea rebutted the allegations made by the EC as regards these bids in paragraph 564 of its First\nWritten Submission. A case study was also submitted by Drewry in its report attached as Exhibit Korea – 70,\npages 7.25 to 7.27.\n11 Korea rebutted the allegations made by the EC as regards this bid in paragraph 584 of its First\nWritten Submission.\n12 Korea rebutted the allegations made by the EC as regards this bid in paragraph 588 of its First\nWritten Submission.\n13 Korea rebutted the allegations made by the EC as regards this bid in paragraph 589 of its First\nWritten Submission.\n\n Annex 6 submitted by the EC in the Anne x V process contains four pages of price\nundercutting calculations for the following:\n\n (i) containerships between 19,000 to 35,000 cgt for the period from 1 January to\n31 December 1999 for 8 EC vessels vis-à-vis 6 Korean vessels;\n\n (ii) containerships between 45,000 and 60 ,000 cgt for the period from 1 January to\n31 December 1999 for 3 EC vessels vis-à-vis 7 Korean vessels;\n\n (iii) container vessels from 19,000 to 35,000 cgt for the period from 1 January to\n30 November 2000 for 18 EC vessels vis-à-vis only 3 Korean vessels;\n\n (iv) LNGs for the period from May to July 2000 for 3 EC LNGs vis-à-vis 3 Korean\nLNGs;\n\n (v) product and chemical carriers between 17,000 to 20,000 cgt for 3 EC vessels vis-à-vis\n5 Korean vessels and only covering 2000.\n\n This is not conclusive for the existence e ither of price undercutting or even of price\nundercutting that would allegedly give rise to pri ce depression (in addition to the calculation errors\nwhich were according to Korea made in the calcula tions). The EC itself has provided in Annex 1b a\nlist of 163 transactions involving EC vessels built fro m 1997 to June 2003 and, of course, Korea itself\nprovided several hundreds of transactions for Korean vessels out of which only 24 were selected as\nhaving given rise to price undercutting. In additi on, the instances selected by the EC are not\nrepresentative of the time period covered in the pre sent dispute from 1997 through 2003. It must be\nemphasized that, in spite of the data available, no single example of alleged price undercutting has\nbeen shown for 2001, 2002 or 2003. Also, while the EC does make the price comparison on the basis\nof differences in sizes (which, as mentioned, by Korea is the bare minimum to make a correct\nassessment of any sort of price trends in relation to commercial vessels), the ranges selected expressed\nin cgt are not representative of the full range in which container vessels and product and chemical\ntankers are sold. Finally, no accurate price comparison of the vessels can be made without considering\ndifferences in physical characteristics such as gearing, the type of engine and other features that were\nlisted in Exhibit Korea – 109.\n14\n\n Annex 7 submitted by the EC in the Annex V process contains 17 alleged examples of lost\nsales, by far not representative of the number of ve ssels contracted for during the relevant period from\n1997 to 2003. In some instances, they are not attr ibuted to any specific Korean yard. Moreover, in\naddition to being statistically and timewise not representative, the documents submitted contain\nseveral flaws of which some of the main ones are mentioned below:\n\n - there is no direct documentary evidence and only hearsay is being offered by the EC\nyards (Annexes 7.4, 7,5, 7.6, 7.7, 7.8, 7.9, 7.10);\n\n - cheaper vessels are recogni zed to exist in Eastern Europe or in Japan (Annexes 7.1,\n7.3);\n\n - the design offered by the EC yard is over-specified compared to the shipowners\nrequirements or the vessel offered by a Korean yard or the design was not available\n(Annexes 7.1, 7.2, 7.3, 7.5, 7.12);\n\n14 Korea notes that it does not agree with the data or conclusions shown in this Annex 6 for various\nreasons including the fact that a price comparison made should have been made in US dollars, i.e. the currency\nuniversally used by yards to quote most of the sales prices of their vessels and not in EUROs which could not\nprovide a true picture of price undercutting caused by subsidies.\n\n - the EC offer is made without there being any order prospect and a broker just issued a\ngeneral inquiry (Annexes 7.2, 7.3);\n\n - the Korean yard alleged to have been competing is not shown in any register as\nhaving obtained an order from the shipow ner concerned raising serious doubts as\nregards the accuracy of the lost sales allegations (Annex 7.4, 7.8);\n\n - the contracts that exist with a Korean yard are for a substantially larger ship than that\nreferred to in the alleged lost sale documents (Annex 7.9, 7.10);\n\n - the tenders made by the Korean yards concerned are for a series of vessels, which has\nan effect on the price given economies of scal e, without this being mentioned in the\nalleged lost sales documents and without it being indicated whether the EC yards\nconcerned could build the full series with in the time required by the shipowner\n(Annex 7.10);\n\n - there was fierce competition am ong EC shipyards (Annexes 7.6/7.12);\n\n - the EC yards were faced with dock rest rictions requiring the adjustment of their\ndesigns (Annex 7.13);\n\n - the EC yard was licensed to build Moss spherical type LNG containment systems,\nrather than GT membrane types and all the orders from the Repsol/Enagas tender\nwere for Membrane GT type containment systems as a result of which the bid from\nthe EC yard cannot be considered like (Annexes 7.14 and 7.16).\n\n As a result, the documents provided by the EC cannot from the basis of any price depression\nallegations and, conspicuously, the EC made use of only a few of these documents in the actual panel\nprocess.\n\n Moreover, in the alleged price undercutting cases referred to in Annex 6 in the Annex V\nprocess, there is no evidence of EC and Korean ya rds bidding for the same tender. All the EC has\ndone is to compare prices for different bids for vesse ls that might fall in the same wide size range but\nmay otherwise differ in important technical features.\n\n In the alleged lost sales cases referred to in Annex 7 to the Annex V process, the Korean\nprices invoked are based on hearsay or allegations by the shipbrokers without any direct supporting\nevidence being supplied.\n\n158. (a) Is it the view of the EC that excess sh ipbuilding capacity exists only in Korea, or\nis there also excess capacity in other countries?\n\n (b) If your view that excess capacity exists only in Korea, please explain.\n\n (c) If your view is that there is excess capa city also outside of Korea, where and how\nmuch is the excess?\n\n (d) Is there any excess shipbuilding capacity in the EC? If not, what is the basis for\nthis conclusion?\n\nComments\n\n It is recognized within the industry that there is no easy way to rigorously measure\nshipbuilding capacity. However, significant attemp ts have been made over recent years, under the\nauspices of the OECD Working Party on Shipbuilding, to improve the estimation of shipbuilding\ncapacity.\n\n The latest estimates of capacity from OECD sources are an estimated figure for actual\ncapacity in 2000 and a figure for anticipated capacity in 2005 which was also made and agreed in\n2001\n15 from estimates provided by the Japanese, EC , USA and Korean shipbuilding associations\nexpressed in cgt. The following table shows an assessment of capacity utilization for the major\nshipbuilding regions based on these capacity assessment s and shipbuilding output statistics from LR\nShipbuilding returns.\n\n Versus 2000 capacity Versus projected 2005 capacity\n 2001 2002 2003 2001 2002 2003\nJapan 90% 93% 95% 84% 86% 88%\nSouth Korea 94% 104% 111% 77% 84% 90%\nEU countries 87% 84% 76% 78% 76% 68%\nAWES non EC\n1 86% 83% 74% 78% 76% 68%\nOther European 61% 80% 87% 54% 71% 77%\nChina, PR of 96% 110% 180% 63% 72% 118%\nAsia & Pacific 43% 63% 48% 39% 58% 44%\nNIS Countries\n2 29% 83% 64% 27% 77% 59%\nNorth & South America 32 % 44% 58% 29% 39% 52%\nAfrica & Middle East 8% 8% 8% 8% 8% 8%\nOthers 0% 0% 0% 0% 0% 0%\nWORLD TOTAL 85% 91% 96% 74% 79% 83%\n1 AWES non EC = Norway, Poland and Romania\n2 NIS = Russia, Ukraine, Latvia, Lithuania, Geogia, Azerbaijan\n\n While Korea is not endorsing this extremely general overview as an appropriate measure for\nthe multiple industries examined in this WTO dis pute, nonetheless, the table helps to indicate the\nsituation regarding estimated excess capacity in the main shipbuilding regions in spite of the difficulty\nin defining shipbuilding capacity and the fact that the 2005 figure is a projection which is now some 3\nyears old.\n\n Against both the 2000 capacity estimate and the 2005 capacity projection it can be seen that\nexcess capacity exists all around the world. Regardi ng the major shipbuilding regions, it is noted that\nthere is significant excess capacity within the EC yards and some overcapacity in Japan. The table\nbelow shows a country level breakdown for the EC’s main shipbuilding countries.\n\n15 OECD Document C/WP6(2001)16 of 'Present Market Conditions and Future Outlook for the World\nShipbuilding Industry' dated November 14, 2001 and prepared by the Secretariat of which an excerpt is attached\nin Exhibit Korea – 123.\n\n Versus 2000 capacity Versus projected 2005 capacity\n 2001 2002 2003 2001 2002 2003\nDenmark 68% 82% 72% 61% 73% 65%\nFinland 116% 88% 69% 116% 88% 69%\nFrance 165% 107% 139% 147% 95% 124%\nGermany 102% 106% 79% 90% 93% 70%\nItaly 80% 89% 88% 69% 77% 76%\nNetherlands 77% 72% 43% 69% 64% 38%\nSpain 59% 67% 88% 54% 62% 81%\nUnited Kingdom 19% 21% 28% 19% 21% 28%\nEU countries 87% 84% 76% 78% 76% 68%\n\n Of particular note is the situation regarding Ch ina, where it is shown that output has exceeded\nthe projected 2005 assessment. At the time of the 2001 projection, unlike the other major\nshipbuilding regions of Japan, Korea and the EC , China did not supply its own estimate nor has it\ndone so subsequently. The OECD capacity estimat es show that output has exceeded the estimated\n2000 capacity figure in both 2002 and 2003 and exceeded the 2005 projected capacity in 2003.\n\n However, there has been considerable grow th in capacity in China since 2000 both through\nimproved performance\n16 and additional or enhanced faciliti es. Drewry Shipbuilding Consultants\nbelieves that there has been excess capacity within China during this period. Over the period 1999-\n2001 it is estimated that the top 20 shipbuilding yards in China (which represented approximately\nthree quarters of the country capacity) were work ing at 55 per cent of their capacity. Drewry\nundertook a detailed estimate of capacity in China, based on the agreed OECD guidelines which\nreflects the type of ships built and performance over the period 1999-2001, which was published in its\n(non-commissioned) report on China’s Shipyards issued in July 2003. This assessed Chinese capacity\nto be 3.187 million cgt at the end of 2002 which ta ken in conjunction with the reported output for\nChina in 2002 and 2003 would indicate utilization levels of 49 per cent and 81 per cent respectively.\nFurthermore, Drewry calculated that a projected additional 0.353 million cgt was scheduled to come\non line by 2005/6. This estimated 2005/6 capacity of 3.54 million cgt contrasts with the earlier OECD\nestimate for 2005 of 2.18 million cgt.\n\n159. The Panel’s written question 30 following the first meeting was as follows:\n\n“In general, how much flexibility does a typical shipyard have to produce all or a\nbroad range of ship types? What are th e physical and other constraints on any\ngiven shipyard’s potential product range? How important is prior experience to\na shipyard’s production cost and capability to build a particular type of ship?\nWith reference to the above considerations, p1ease describe the capabilities and\nexperience of each EC shipyard that pr oduces or is capable of producing some\nor all of the kinds of commercial vessels cited in your serious prejudice claim.”\n Please present a summary of any informatio n already before the Panel, including the\nAnnex V information, that is relevant to this point but was not referred to in the EC’s original\nanswer to this question.\n\n16 One of the great difficulties in this area is that potential capacity is profoundly influenced by\nefficiency of production, not just by nominal physical capacity. This explains in part why China with its great\npotential is such a “wild card” in the projections.\n\nComments\n\n In light of the Panel’s question, Korea cannot help but reiterate that the EC has not made\navailable any information in this regard, whether by ship type or, a fortiori, by like product vessel in\nthe framework of this proceeding. Korea has already expressed its su rprise at the EC’s statement in\nparagraph 131 of the EC’s response to the Panel’s Question 30. Indeed, the EC has circulated three\nquestionnaires to the EC shipyards in the course of the EC’s Trade Barrier Regulation proceedings\nduring the period from 2000 to 2002 requesting in formation on vessels built and sold by the EC\nshipyards. It has obtained the co-operation of around 21 shipyards over this period providing\nresponses to these questionnaires ( See also Annex 1a of the documents submitted by the EC in the\nAnnex V process). Based on the detailed informatio n that it must have received and on data that\nshould be available to its expert, FMI, it should have been possible to address at least for these 21 of\nthe most important EC shipyards their capabilities a nd experience in producing some or all of the\nkinds of commercial vessels cited in the serious prejudice claims.\n\n Korea also refers to Annex 1b of the documen ts supplied by the EC in the Annex V process\nwhich clearly indicates that many if not most of the EC yards during the period from 1997 to\nJune 2003 produced only one - or at most two - types of commercial vessels concerned by the present\ndispute, for example:\n\n - Aker MTW: product and chemical carriers, container ships;\n - HDW: container ships;\n - IZAR: product and chemical carriers, LNGs;\n - Kvaerner Warnow: container ships\n - Odense: container ships\n - Thyssen: container ships\n - Fincantieri: product and chemical carriers\n - Kröger Werft: container ships\n - Stralsund: container ships\n - Peene Werft: container ships\n - Flender Werft: container ships\n - Lindenau: product and chemical carriers\n - SSW: container ships\n - Aker Ostsee: container ships.\n\n Chantiers de l’Atlantique is not even on th e list but should be listed only for LNGs anyways.\nThis is confirmed for the above EC yards and for ot hers in Annex 2b filed by the EC in the Annex V\nprocess with the list of orders per shipowner’s nationality.\n\n In fact, if the correct like product determination were taken into account, as argued by Korea,\nit would also be established that EC yards concentr ate in specific size ranges within the product types\nof container ships and product and chemical carriers. Moreover, this is not the result of the bestowal\nof the alleged Korean subsidies but is the result of a more than decade-long evolution. This evolution\nstarted well before any of the alleged subsidies were granted and reflects a decision on the part of the\nEC yards to specialize in specific like product types of vessels, with the largest amongst the EC yards\nhaving decided to concentrate in particular on high va lue added vessels such as cruise ships, ferries or\nroll-on-roll-off vessels where they cont inue to occupy a very high mark et share. This may, however,\nbe an effect of the myriad EC subsidies.\n\n The EC yards have no intention to build every type of vessel or every type of size but have\nspecialized more narrowly and made investments acco rdingly. By way of example, Korea refers to\nAnnex 4b of the documents submitted by the EC in th e Annex V process. In particular, the financial\nstatements for 2002 of Aker MTW (refer to the Ma nagement Report for Fiscal Year 2002, Section 1\non Business Development at Exhibit 4/2) which, having stated that the yard wa s able to “beat Korean\n\ncompetitors” for the order of 6 container ships of 2500 teu, to be built for the Iranian shipping line\nIRISL, and having a cruise ship on order.\n\nIn 2002, the focus of investment was the re placement of equipment and systems, esp.\nto allow the parallel manufacture of container ships and cruise ships.\n Reference is also made to the financial statem ents for Chantiers de l’ Atlantique for the year\nclosed on 31 March 2001 also included in Annex 4b of the data submitted by the EC in the Annex V\nprocess. In particular, the Message from the CEO Pie rre Bilger at page 14 where it clearly identifies\nferries, cruiseships and LNGs as well as naval build ing to be the continued priority. Of course, only\nLNGs are the subject of the present dispute, thereby confirming that Chantiers de l’Atlantique is not\ninterested in containerships or product and chemical carriers (as is confirmed also by the fact that\nFrance has applied for the EC’s temporary defense mechanism aid only in respect of LNGs).\n\n Korea further refers the Panel to the financial st atements of the important EC yard Fincantieri\nin Annex 4b. Korea notes that, while the yard in its annual reports refers in elaborate terms to its\nbuilding of cruiseships and ferries, there is nothing on the building of other commercial vessels, save\na cursory reference to the building of chemical tankers of which the EC itself says that these are\noutside the purview of the present dispute, notwithst anding that it maintains a supply substitutability\nfor all vessels alike.\n\n HDW in its financial statements for the y ear ended on 30 September 1997 also attached in\nAnnex 4b states the following at page 12:\n\nOur product developments in merchant sh ipbuilding revolve round customer-driven\nsolutions to sea transport problems of all ki nds and also new concepts for passenger\nships. HDW cruise ships are either modern ship s built in the style of past eras or new\ntypes of luxury apartment ships never built be fore. With regard to freighters, we are\nconcentrating on developing fast ferries a nd container ships, new insulating systems\nfor gas tankers and designing ships for transporting reefer containers.\n Having thus set its priorities, it is clear that HDW did not wish to pursue other vessel types\nsuch as LNGs or product and chemical tankers, or di d not consider itself capable with respect to such\nother vessel types.\n\n The Management Report for the 2001 Financial ye ar of the financial statements of Kvaerner\nWarnow (Annex 4 thereto, Section 4) states the following:\n\nContainer ships will continue to form K WW’s core business. However the shipyards\nplans to expand its range of products in order to reduce its dependence on price trends\nin the container ship market. This objec tive will be attained in cooperation with\npartner shipyards within the Group. The expertise and reputation the yard has\nacquired in building the drilling platform will open up new opportunities for other\noffshore projects and will be built on and expanded in cooperation with partner yards\nwithin the Group.\n Having already stated in Section 1.5 that R&D focused on the development of designs for\nstandard container ships, it is clear that Kvaerne r Warnow intentionally concentrated on the building\nof container ships and did not contemplate di versifying into other commercial vessels, but\ncontemplated the additional building of drilling rigs.\n17\n\n17 Reference is also made to Kv aerner Warnow’s management report for the 2000 financial year\n(Annex 4, page 5 of 6) also attached in Annex 4b wh ere the yard stated that “K WW, which has specialised in\nthe container ship market, will continue in the near future to depend on obtaining new contracts in this field.”\n\n The same is true for Volkswerft Stralsund wh ich in Section 3. of its Annual Management\nReport attached to its financial statements for 1 999 in Annex 4b indicated that “[t]he yard will\ncontinue to concentrate its marketing activities on medium-sized container ships and large special-\npurpose vessels for the offshore sector.”\n18\n\n160. Concerning the composite ship newbuildin g price index furnished by the EC, the EC\nindicates that major shipbuilding consultants also maintain “more specific price information for\nparticular ship types”. In Attachment 2 to its answers to questions, the EC provides price\ninformation for two sizes of tankers and for eight sizes of container ships.\n\n (a) Is this the “more specific’ information to which the EC refers?\n\n (b) Why does the EC show the particular breakouts that it does? Do other\nbreakouts exist for these products? Please explain.\n\nComments\n\n Korea refers to its response to Question 173 d) and e) regarding the detailed price series\nindices that are used in the industry.\n\n161. The EC presents indices of estimated Ko rean production costs versus prices in support\nof its argument that there is price suppression/depression The EC indicates that its consultant,\nFMI, prepared the cost estimates, taking into account various known cost trends and cost\nadvantages of the Korean yards. The EC in its an swers to questions following the first meeting\nprovided a description of the methodology used by FMI to prepare these estimates. The EC also\nindicated that, should the Panel so request, it would furnish the detailed underlying data. Is it\nthe view of the EC that a graphical presentation of price indices, along with a description of\nmethodology, constitutes prima facie evidence of evolution in Korean shipbuilding costs? Please\nexplain.\n\nComments\n\n Korea observes that the EC has not even provided production cost versus price indices for\neach of the vessel segments that the EC itself has identified. In the Second Substantive Meeting, upon\na request of the Panel, the EC has confirmed that a serious prejudice assessment should be made for\neach of the three product segments identified by the EC separately. While the same question is now\naddressed in writing to the EC, having clearly separated the three product segments, in the EC’s\nrationale, there is no reason why the EC should r espond differently in writing. Thus, when the EC\nalleges that price suppression must exist because in the absence of price pressure due to Korean\nsubsidies, the increase in demand, freight rates and cost of production would have led to price\nincreases, the EC should have made a prima facie case in support of its allegations already in its First\nWritten Submission for each of its own product segments separately.\n\n The EC failed to do so and even further weakened the strength of its allegations in\nAttachments 2 and 6 of its responses to the Pa nel’s questions as well as in its Second Written\nSubmission. The following will clarify this:\n\nKorea notes for the record that the same report mentions that “[t]he competitiveness and profitability of the\nshipyard would be improved if the production limits imposed by the EU were eased or lifted.”\n18 Section 5. of the management report for the 2002 financial year also attached in Annex 4b) confirms\nthat: “[o]ur acquisition activity will continue to focus on the tried and tested market segment of mid-sized\ncontainer ships and supply ships.”\n\n First Written Submission Attachment 2 of the EC’s responses to the\nPanel’s questions\n Price developments Price and cost\nindex\nPrice developments Price and cost index\nLNGs Newbuilding price\ndevelopments\n(Figure 30 at page\n164)\nCost and price\nindices for Korean\nLNGs (Figure 38 at\npage 165)\n\nNo explanation on\nhow these cost\nindices were\nobtained and which\nLNGs are reflected\nin these LNGs.\nYear-end prices of\nLNGs (Figure 1.3\nat page 3)\n\nCost and price indices\nfor Korean LNGs\n(Figure 1.5 at page 4\n\nHalf of one page\nexplanation on the\n“estimation” of cost\nindices (Section 4 at\npage 16) but still no\nclear explanation on\nhow these costs were\ncalculated or which\nLNGs are reflected in\nthese indices.\nContainer vessels A graph with world\nmarket prices for\n3,500 teu and for\n1,100 teu container\nvessels taken from\nClarkson Research\nStudies\n(Figure 41 in the\nEC’s First Written\nSubmission, at\npage 167)\nCost and price\nindices for Korean\n3,500 teu container\nvessels (Figure 40\nat page 166 of the\nEC’s First Written\nSubmission)\n\nPrice indices\npresumably\ncalculated based\non Figure 41.\n\nNo explanation on\nhow these cost\nindices were\nobtained and which\ncontainer vessels\nare reflected.\n\nNo explanation as\nto why conclusions\nfor all container\nvessels are drawn\non the basis of a\nspecific size range\nonly.\nA graph is shown\nwith price\ndevelopments for 8\ndifferent sizes of\ncontainers based on\nClarkson research.\nCost and price indices\nare shown for a\nKorean panamax\ncontainer ship (Figure\n3.7 at page 15.\n\nThe comments with\nregard to the data in\nthe First Written\nSubmission remain. In\naddition, it is\nquestioned whether\nthe cost and price\nindices shown in\nFigure 3.7 can be\nreconciled with those\nin the First Written\nSubmission. The latter\nreflected those of\n3,500 teu container\nvessels while\nAttachment 6 to the\nEC’s responses to the\nPanel questions\nindicates that\nPanamax container\nvessels which are\nreflected in Figure 3.7\ncover vessels between\nabout 4,000 and 5,000\nteu (item 7. at page 1.)\n\nThere seems to be an\ninconsistency in the\nEC’s demonstration.\nProduct and\nchemical tankers\nNo price\ndevelopments\nshown at all.\nCost and price\nindices for Korean\nhandysize product\nPrice developments\nfor handymax and\npanamax products\nNo cost and price\nindices are shown and\nthere is no indication\n\n First Written Submission Attachment 2 of the EC’s responses to the\nPanel’s questions\nand chemical\ntankers (Figure 43\nat page 169 of the\nEC’s First Written\nSubmission)\n\nNo indication on\nhow the price\nindices were\ndetermined.\n\nNo explanation on\nhow these cost\nindices were\nobtained and which\ncontainer vessels\nare reflected.\n\nNo explanation as\nto why conclusions\nfor all product and\nchemical tankers\nare drawn on\nthe basis of a\nspecific size range\nonly.\n\ntankers taken from\nClarkson’s (Figure\n2.3 at page 8)\n\nThe data is shown\nfor “product\ntankers” while the\nEC has constantly\nindicated that\n“product and\nchemical tankers”\nare concerned by\nthe present dispute\nand has indicated\nin the Second\nSubstantive\nMeeting that it is\nconcerned with\ntankers that\ntransport both oil\nand chemical\nproducts. It is,\ntherefore, not clear\nwhether these\nprices reflect sown\nin Figure 2.3\nreflect those of the\nproducts concerned\nby this dispute.\nas to whether the EC\nmaintains those shown\nin Figure 43 of its\nFirst Written\nSubmission.\n\nThere is total\nuncertainty as to the\nallegations. If the EC\nmeant to maintain\nFigure 43, the\nquestions/observations\nin the third column of\nthis table remain\nvalid.\n\n As mentioned, it is not clear how the cost i ndices used were arrived at or whether the cost\nreports of FMI submitted in Annex 10a of the docum ents supplied by the EC in the Annex V process\nwere taken into account. However, if they were, in addition to the criticism already mentioned by\nKorea in its Second Written Submission (at page 124) or in the Drewry Report (Exhibit Korea – 70 at\npage 8.22), Korea submits that the cost calcula tions are not sufficiently representative as to be\nconclusive. Indeed, cost calculations were made for the following vessels subject to the present\ndispute:\n\n - Hanjin 4,900 teu container;\n - Daewoo 5,100 teu container\n - STX 51,000 dwt tanker (which may be a product tanker not concerned by this\ndispute)\n - Hyundai Mipo handymax tanker\n19\n - Daewoo LNG for Exmar\n - Hyundai LNG for Golar\n - Hyundai 2,500 teu\n - Samsung 5,500 teu container\n - Samsung LNG for British Gas\n\n19 For details on this vessel and the preceding three, refer to Section 6 of the FMI Mid-term report,\nShipbuilding Marketing Report – Phase 4, March 2003, Annex 10a of the documents submitted by the EC in the\nAnnex V process.\n\n - STX panamax products tanker (which ma y not be concerned by this dispute that\nconcerns combined product and chemicals tankers)\n - STX product and chemicals tankers 20\n - Hyundai 7,200 teu container vessel,\n - Daewoo LNG for Bergesen\n - Samho Aframax tankers (which may not be concerned by this dispute that concerns\ncombined product and chemicals tankers)\n - Samsung 7,200 teu container ship\n - Daedong 2,500 teu container ship\n - Hyundai Mipo handysize products tanker (which, as mentioned above, may not be\nconcerned)\n - Shin-A handysize products tankers (which as mentioned above, may not be\nconcerned)\n21\n - Daedong 35,000 dwt tanker (if a product ta nker, this product may not be concerned)\n - Hanjin 5,608 teu container ship\n - Hanjin 1,200 teu container ship\n - Hanjin 6,250 teu container ship\n - Halla 3,500 teu container ship\n - Hyundai 6,800 teu container ship\n - Hyundai 5,600 teu container ship\n - Hyundai LNG for Bonny Gas Transport\n - Hyundai 5,500 teu container ship\n - Samsung 5,500 teu container ship\n - Samsung 3,400 teu container ship\n22\n\n Thus, it would seem that cost calculations have been made at best for around 25 vessels out of\nthe hundreds of Korean vessels sold that are vessel types concerned by the dispute. Not even half of\nthese cost calculations concern vessels built by restructured yards.\n\nKorea, therefore, submits that if this were the basi s for the cost indices set forth by the EC in relation\nto price indices, these cost indices are not representati ve compared with the total sales of the vessels\nconcerned by the restructured yards in terms of th e number of vessels sold or in terms of like product\ncoverage. If these are not the basis for the cost indi ces, the indices relied upon by the EC constitute all\nthe less prima facie evidence sufficient to demonstrate the existence of price suppression as they are\nassertions only without any substantiating evidence. In any event, Korea submit s that the EC has not\ncarried the burden of proof that rested on it.\n\n162. What specific evidence/examples are contained in the information before the Panel in support\nof the EC argument that prices at one end of the product spectrum for a particular kind of ship\ninfluence prices along the entire spectrum? (For exampl e, is there specific evidence in the information\nbefore the Panel that a downward movement in very large container ships brings about commensurate\ndownward movement in all smaller sizes of container ships?)\n\n20 For details on this vessel and the preceding five, refer to Section 6 of the FMI Final report,\nShipbuilding Market Monitoring – Phase 3, August 2002, Annex 10a of the documents submitted by the EC in\nthe Annex V process.\n21 For details on this vessel and the preceding six, refer to Section 6 of the FMI Final report,\nShipbuilding Market Monitoring, Phase 2, May 2001, Annex 10a of the documents submitted by the EC in the\nAnnex V process.\n22 For details on this vessel and the preceding five, refer to Section 2.2.2 of the FMI Final summary\nreport, Shipbuilding Market Monitoring, April 2000, Annex 10a of the documents submitted by the EC in the\nAnnex V process.\n\n163. (a) For each ship category, in prac tical terms how substitutable are different\nsizes/configurations (containment syst ems, in the ease of LNGs)? Are there\nspecific evidence/examples in the inform ation before the Panel? In addition,\nplease furnish relevant portions of the industry publications discussed at the\nsecond meeting. (For example, one industr y expert referred at the meeting to\none of the industry publications that contains information relevant to cross-price\nelasticities).\n\nComments\n\n For all ships, size is a major barrier to substitutability for several reasons:\n\n 1. bigger ships cannot physically operate on many of the routes or ports serviced by\nsmaller vessels,\n\n 2. trade volumes would mean that bigger sh ips would have to operate part empty on\nmany lower volume routes serviced by smaller vessels; and\n\n 3. ship operating economies of scale are such that it is considerably more expensive per\nunit of cargo carried in a small ship compar ed with a larger vessel (which is why\nlarger ships are built). Information was provided in Exhibits Korea - 70 and 109\nregarding the different operating costs of v essels and this information is published in\nDrewry’s industry reports.\n\n There are other reasons which tend to be more ship type specific, some of the main ones\ninclude:\n\nProduct/chemical tankers:\n\n• IMO Class of the tanks on product chemical tankers limits the cargoes a vessel can carry by\nregulations, it would be particularly unlikely th at expensive IMOI/II vessels would be used to\ncarry oil products;\n\n• Tank coatings limit the cargoes that can be ca rried in oil products and chemical/products\ntankers;\n\n• Some cargoes trade in relatively small volumes from one destination to another whilst others\nare traded in high volume, small volumes of car go require smaller tanks and higher levels of\ntank subdivision and it is economically not viable to carry small volumes in large tanks or\nvice-versa.\n\nContainer ships\n\n• Smaller vessels tend to have lo wer speeds and can therefore not maintain the time schedules\nfor liner services on routes that are operated by large vessels – this would result in a major\nfailure of delivery service to customers;\n\n• Large containerships are built without their own cargo handling gear because they trade\nbetween dedicated container ports which are e quipped with high speed unloading facilities.\nThey would therefore not be able to unload in less specialized ports that do not provide these\nsince the ships are too large to be serviced by the cranes available in smaller ports. For this\nreason the ships using these smaller ports are equipped with their own cargo handling cranes;\n\n• On certain trade routes – notably north–south routes – there are significantly higher volumes\nof refrigerated cargoes and these cannot effectivel y be traded by ships with lower levels of\nreefer capability which are intended to be traded on East-West routes.\n\nLNG ships\n\n• Ships destined to trade to ports that do not have land-side re-liquefaction facilities must\nincorporate these facilities on the ship or they cannot discharge their cargoes. The expansion\nof LNG trade is seeing an increase in such instances;\n\n• Certain membrane systems experience ‘sloshing’ problems if they have partly empty tanks so\nthey cannot discharge parts of their cargoes at di fferent ports. This is mainly a consideration\non certain Japanese LNG routes.\n\n (b) Can the EC cite specific instances/situa tions in the information before the Panel\nwhere a shipowner has purchased and used a larger-than-usual ship for a particular\nrun, due to a relatively low price for the larger ship?\n\n164. What specific evidence is there in the information before the Panel that APRGs and PSLs\naround the time of the restructuring helped the shipya rds in question to remain in operation, whether\nby improving their balance sheets/cash flow or otherwise?\n\n165. For each category of ship, what has been the evolution in prices versus costs in other major\nshipbuilding countries since the mid-1990s, and how does this compare with the trends in Korean\nprices versus costs?\n\n166. (a) For each of the three ship types, wh at specific evidence/examples are there in the\ninformation before the Panel (in additi on to the domestic complaint by Samsung\nagainst Daewoo) that the restructured sh ipyards were the price leaders among the\nKorean producers?\n\n (b) What evidence is there in the information before the Panel in support of the EC\nargument that the alleged restructuring subs idies enabled the restructured yards to\ndrive down the prices charged by all other Korean shipyards?\n\n (c) What has been the annual financial perfo rmance of the other (non-structured) Korean\nshipyards since the restructuring?\n\n167. If, as the EC argues, shipyards have near-total flexibility to produce any kind of ship,\nand the Korean yards are heavily subsidized , why are Korean shipyards not more-or-less\nequally active in all kinds of ships (including cruise ships, ferries, etc.)?\n\nComments\n\n Refer to the response to Question 126 which de monstrates that EC shipyards do not practice\nfull supply-side substitutability across all ship typ es. The following examples demonstrate this is a\ncommon situation in other regions as well.\n\n Japan has a large number of shipyards and build s ships across a wide range of ship types.\nFurthermore as it has a strong domestic customer base, it is unlikely that a yards absence from a\nmarket reflects any alleged anti-competitive actions by other countries’ yards. Out of 130 yards in\nJapan that have delivered ships since 1990 or currently have ships on order:\n\n• only 5 are active in the LNG sector\n• only 11 are active in the passenger/cruiseship market for larger cruiseships\n• 24 yards are active in the Reefer (refrigerated) ship market\n• 26 yards are active in the Crude Oil tanker market\n• 36 yards are active in the Containership market and only 9 are active in the market for teu\nships of 3,500 teu or larger\n• 47 yards are active in the LPG market\n\n Some ship types are so specialist that there are only a few yards active across the whole world\nmarket. The obvious examples are for large Cruise sh ips where there are 7 yards worldwide who have\nbuilt (or have on order) cruise ships of 60,000 gross tons or larger since 1990, and of the 86 ships\ninvolved 80 of them have been shared amongst 4 sh ipyard groups, namely: Chantiers de l’Atlantique,\nFincantieri group, Kvaerner Masa Yards and Meye r Werft. The remaining 6 comprise 2 each at\nBremer Vulkan, Lloyd Werft (both EC yards) and Mitsubishi HI of Japan. In the LNG sector, the\nnumber of active players is also of course limited, where 14 yards have built (or have on order) the\n169 ships involved since 1990.\n\n In fact, a full analysis of all ship types i ndicates that over 1100 yards (or shipbuilding groups)\nhave participated in the market since 1990 and of these:\n\n• 52 have built or have orders for Reefer ships\n• 71 have built Crude Oil tankers\n• 85 have built Dredgers\n• 92 have built LPG\n• 157 have built Ro-Ro ships\n• 180 have built Container ships\n• 211 have built Bulk Carriers\n• 214 have built Offshore vessels\n• 224 have built some IMO class of Chemical tanker\n• 386 have built General Cargo or Multi-purpose cargo ships\n\n Much reference has been made to the emerge nce of China as a major shipbuilding nation and\na similar profile for China shows that of record ed deliveries/orders (some domestic and smaller\nvessels are unlikely to be fully reported) since 1990 there are 100 active shipbuilding yards, of which:\n\n• none are involved with Cruise ships\n• 1 is involved with LNG ships\n• 3 are involved with Reefer ships\n• 5 are involved with LPG ships\n• 8 are involved with Ro-Ro ships\n• 10 are involved with Crude Oil tankers\n• 12 are involved with some IMO class of Chemical tanker\n•\n 22 are involved with Offshore vessels\n• 33 are involved with Bulk Carriers\n• 37 are involved with Container ships\n• 58 are involved with General Cargo or Multi-purpose cargo ships\n\n We believe that this highlights the non-homoge neity of the shipbuilding market supply side,\nand the fact that in practice yards do not try to oper ate in all market sectors but concentrate on certain\ntypes where they have a competitive advantage.\n\nIII. TO BOTH PARTIES\n\nA. ITEM(J) / ITEM (K), FIRST PARA.\n\n168. The parties disagree as to whether APRG S constitute export credit guarantees and\nwhether PSLs constitute export credits. Plea se provide any documentation (either from the\nshipbuilding industry, the OECD, or any other so urce) that you consider supports your position\non these issues.\n\nResponse\n\n The EC has challenged whether APRGs and PSLs are export credit guarantees based largely\non who receives the facility. A couple of problems w ith the EC arguments are that the “beneficiary”\nas the EC identifies it, are different in the two instances. According to the EC’s arguments, APRGs\nare on behalf of the foreign buyer and that is not an export guarantee. Of course, PSLs are on facilities\nprovided directly to the shipbuilder which causes some problems in the EC’s argumentation.\n\n The EC tries to get around this problem by i gnoring it and making a blanket statement that the\nsecond paragraph of item (k) refers to the OECD and therefore this must be the context for\ninterpreting the first paragraph. Thus, according to the EC, the OECD interpretations would not\nencompass PSLs. As Korea has noted, there is no legal or logical basis for this line of argumentation.\nIt is axiomatic that an exception is to be constr ued narrowly. Therefore, there is no basis at all for\nconstruing the rule and the exception to be of pr ecisely the same breadth. The treaty language itself\ngives no such primacy to the OECD over the WTO. While the second paragraph of item (k) has been\ninterpreted as providing a specific exception that applies to the OECD, this is a matter of\ninterpretation for the OECD is not mentioned in the treaty text; While Korea, of course, is not\nrejecting the OECD as a useful gatherer of informati on, this sort of judicial interpretation certainly\ncannot be the basis for subordinating the WTO treaty to other provisions in the OECD documents.\n\n The EC continues with its creation of new le gal rules outside of the plain meaning of the\nlanguage by arguing that export credit guarantees ar e meant only to include support for domestic\nproducers to protect them from unknown foreign risks. Of course, the provisions of the items (j) and\n(k), first paragraph, do not limit themselves in this manner. This proposed limitation is a creation of\nthe EC and one that the EC had to acknowledge during the course of the Second Substantive Meeting\nis anachronistic even if it were appropriate for the Panel to rely in its legal analysis on a somewhat\ndubious EC rendition of the “philosophy” of the OE CD Arrangements. Moreover, as is demonstrated\nbelow, this EC characterization of covered and non-covered instrume nts is both highly artificial and\nsimply inaccurate.\n\n Korea has discussed before how it disagrees w ith the EC about the EC’s extremely narrow\nconstruction (when it suits the EC’s purposes) on the OECD language. Korea has already specifically\nprovided evidence that the United States has made its views known in the OECD that it does not agree\nwith such an overly narrow interpretation of what constitutes an export credit or guarantee. Indeed,\nKorea remains somewhat puzzled by this EC argu ment. The EC refers to the APRGs as guaranteeing\nthe shipbuilders’ domestic risk rather than the foreign risk. Of course, the parties would not be\ndiscussing the safe harbours if one was not assuming arguendo that the Panel had already found that\nthese were export subsidies. As Korea noted during the Second Substantive Meeting, the nature of\ndisputes such as this is that the respondent has to argue in the alternative on every contested issue\nafter the first one. The respondent presents continge nt arguments on the hypothetical assumption that\nit has lost the previous issues. On the other hand, th e situation is totally different with respect to the\ncomplainant. The complainant must prevail on every one of the issues and, while it is not a rigid rule,\nnormally would only address issues arguendo if it is making, for instance, a non-violation claim under\nArticle 26 of the DSU. In this instance, it is impos sible to see how the EC can argue that these are\ndomestic instruments and not export instruments unl ess it wishes to concede the basic point of its\n\nwhole claim, i.e. export contingency. If it is a programme of credit guarantee and is contingent on\nexportation, it follows that it is an “export credit guarantee” within the meaning of item (j). In relation\nto this, the explanation by the UN Economic and Social Commission as to “export credit guarantee” is\nenlightening. The Commission defines the export cred it guarantee as “instruments to safeguard export\nfinancing banks from losses that may occu r from providing funds to exporters.”\n23 The Commission\nsees that export credit guarantee is likewise benefici al to exporters, as “[s]uch guarantee allows\nexporters to secure pre-shipment financing or post-shipment financing from a banking institution\nmore easily.”24 When read in light of the following examples of other Member’s practices, it is clear\nthat the APRG squarely falls in the export credit guarantee, as it is an instrument to safeguard ship-\nbuyers or the financing banks on their behalf from losses that may occur from providing funds to\nshipyards.\n\n KEXIM is not alone in offering these sorts of instruments. For example, the Finnish ECA,\nFinnvera offers bond guarantees of various types. According to the Finnvera website, “the Bond\nGuarantee is a countersecurity for the bank i ssuing a bond on behalf of the exporter in favour of the\nforeign buyer . The bonds that the buyer may require include, for example, a bid bond, an advance\npayment bond, a performance bond or a maintenance period bond.”\n25 There are two important aspects\nto the explanation of the guarantee. First, Finnvera does not limit the guarantee to situations arising\nfrom foreign risk. Second, it also illustrates how a fa cility that nominally protects the foreign buyer\nreally can operate to protect the shipbuilder from such foreign political risks – just the sort of risk the\nEC says are the focus of item (j): “For the exporte r, the guarantee is an insurance against call of the\nbond. The guarantee provides cover against unfair call of the bond and against call owing to political\nrisks. Political risks include war, insurrection or other such event in the buyer’s country preventing an\nexporter from fulfilling the obligations under the cont ract, with the result that the buyer calls the\nbond.”\n\n Similarly, Hermes of Germany provides for th e availability of the following kinds of bonds\nand guarantees: “Advance payment bonds, performance bonds and maintenance bonds.”\n26 ECGD in\nthe United Kingdom provides a variety of export cred it facilities to both buyers and suppliers; it does\nnot seem to limit itself to one side of the tran saction. Among the instruments it provides are various\nBond Insurance Policies, or BIPs. ECGD identifies these BIPs as including:\n\nAdvance Payment Guarantees. These are to protect the buyer against the loss of\nmoney paid in advance. They are partic ularly common where there is a significant\ndesign and manufacturing phase before the deliv ery of the equipment or goods to the\nbuyer. The key risk for exporters with these bonds is that political events may\nfrustrate a contract after the advance payment has been received, but before the goods\nhave been delivered or the contract completed.\n27\n The ECGD website goes on to explain that this foreign political risk is an import aspect, but\nnot the only one. The BIPs guarantee against any unfa ir call of the bond, not just political risks which\nECGD identifies separately. Another example comes from the EFIC (the Export Finance and\nInsurance Corporation) of Australia. The EFIC prov ides on behalf of eligible exporters “Advance\nPayment and Performance Bonds” as security for a dvance payments or in support of exporters’\nperformance obligations under the contract.28\n\n23 Exhibit Korea – 137. Excerpt from Trade Facilitation Handbook by UN Economic and Social\nCommission for Asia and the Pacific (p. 61) (ST/ESCAP/2224).\n24 Ibid.\n25 Exhibit Korea – 124. (emphasis added)\n26 Exhibit Korea – 125.\n27 Exhibit Korea – 126. Korea would specifically like to bring to the Panel’s attention that the term\n“bond” is used interchangeably with the term “guarantee” by the ECGD and implicitly so by the other ECAs.\n28 Exhibit Korea – 138.\n\n Export Development Canada (“EDC”), provides for pre-shipment financing “for exporters\nwho need cash for manufacturing their goods before they export.”\n29 EDC goes on to explain:\n\nPre-Shipment Financing helps Canadian exporters win more business by raising\nsufficient working capital to fund up-front costs associated with export contracts.\nEDC encourages Canadian financial instituti ons to advance pre-shipment loans to\nexporters.30\n GIEK of Norway provides a “Pre-shipment gua rantee. Protects the exporter against losses that\nmay occur during the production, prior to deliver y.” It also provides “B ond Guarantees. Helps the\nexporters to furnish guarantees for tenders, advance payments or competition (bonds)”.31\n\n The ECGD and the Indian Exim Bank both provide for post shipment loans directly to the\nsupplier, but that is not legally distinguishable fro m precisely the type of pre-shipment loans offered\nby various ECAs. Indeed, India Exim also offers the same sort of facility on a pre-shipment basis:\n\nPre-Shipment Rupee Credit\nPre-shipment Rupee Credit is extended to finance temporary funding requirement of\nexport contracts. This facility enables pr ovision of rupee mobilization expense for\nconstruction/turnkey projects. Exporters could also avail of credit in foreign\ncurrencies to finance cost of imported inputs for manufacture of export products to be\nsupplied under the projects. Commercial banks also extend this facility for definite\nperiods.\n32\n India Exim also provides what it describes as Non-Fund based facilities that are “guarantees\ndirectly or in participation with other banks, for project export contract”. These include:\n\nAdvance Payment Guarantee.\nExporters are expected to secure a mobili zation advance of 10-20 per cent of the\ncontract value which is normally released against bank guarantee and is generally\nrecovered on a pro-rata basis from the progress payments during the project\nexecution.\n33\n It can be seen from these examples that both APRGs and pre-shipment loans are not limited\nto Korea. These facilities also do not fit so easily in to the EC’s simplistic construct of what is a\ndomestic or foreign risk.34 Clearly APRGs and PSLs are the instru ments to which the safe harbours in\nitems (j) and (k) first paragraph, respectively, may apply.\n\n169. Item (j) refers to the provision of various “programmes”. Assuming that an a contrario\ninterpretation of item (j) is permissible, could it operate as a defence for individual APRG\ntransactions, as opposed to the APRG programme per Se? Please explain. In particular, if the\nfocus of item (j) is on the long-term operati ng costs of the programme, how could item (j)\n\n29 Exhibit Korea – 127.\n30 Ibid.\n31 Exhibit Korea – 128.\n32 Exhibit Korea – 129.\n33 Ibid.\n34 Indeed, if the EC’s narrow and simplistic construct is correct, then a number of EC Member States\nare prima facie in violation of Part II of the SCM Agreement as their programmes would be outside of the\nparameters of the OECD Arrangement and not protected by any safe harbours.\n\ndetermine whether or not individual transact ions under the programme constitute export\nsubsidies?\n\nResponse\n\n As discussed during the Second Substantive Mee ting, the language of item (j) would appear\nto require an assessment on a programmatic basis. That is, the Panel must look to see whether the\npremia charged in the programmes are covering th e long-term operating costs of such programmes.\nOnce that is established, then even if an individua l transaction might be at a premium level that, if\napplied generally, would not cover the long term operating costs, then because the programme covers\nsuch costs, such an individual transaction would be within the safe harbour. The flip side of this point\nis that it necessarily follows that if the programme is not covering its long term operating costs, an\nindividual transaction will not be within the safe ha rbour even if it is at a premium level that, if\ngeneralized, would cover the long term operating costs.\n\n In Korea’s view, the Panel must make a judgm ent call as to what is “long term” and then\nassess the evidence regarding whether or not the programme in question h as covered its operating\ncosts and losses during such period. While that may be a difficult inquiry in some other cases, Korea\nhas supplied evidence in this dispute that demons trates that the APRG and pre-shipment loan\nprogrammes have covered KEXIM’s operating costs and losses over all periods including the difficult\nperiod of the Asian financial crisis.\n\nB. APRG/PSL\n\n170. Korea asserts that KEXIM PSL rates have been above certain DSME bond rates since\n1999 (para. 231, Korea’s First Written Submission ). The EC asserts th at certain DHI bonds\nwere guaranteed (para. 124, EC’s Second Written Submission). Are the parties referring to the\nsame bonds, or were the DSME bonds referred to by Korea different from the DHl bonds\nreferred to by the EC? Please explain.\n\nResponse\n\n Korea would like to note that the statement by the EC in para 124 of its Second Written\nSubmission is incorrect and misleading. Firstly, as clearly indicated in its Exhibit EC – 129 which\nwas referred to in para 124 by the EC, all bonds lis ted therein are not guaranteed. While some of them\nare guaranteed, the rest are “non-guaranteed” (for example, see page 3 of Exhibit EC – 129).\nSecondly, as submitted earlier by Korea, when DSME and DHIM were spun-off from DHI, debts\nincluding corporate bonds were allocated to the tw o companies in accordance with the relevance to\nthe spin-off companies. In other words, all DHI debts incurred thus far relating to shipbuilding\nbusiness were assigned to DSME, and all debts incurre d thus far relating to machinery manufacturing\nbusiness were assigned to DHIM. However, Exhibit EC – 129 is not the one which took into account\nsuch debt allocation (as it was made prior to the spin-off), simply listed all the then outstanding DHI\ncorporate bonds. The debts which were allocated to a distinct company cannot make a benchmark for\nDSME’s loans. Korea hereby submits Exhibit Korea – 139 . It lists such bonds that were ultimately\nassigned to DSME upon the spin-off out of the bonds listed in Exhibit EC – 129.\n\n In contrast with this, the Exhibit Korea – 18 shows the balance of outstanding corporate\nbonds (which were ultimately assigned to DSME) as at the end of each quarter and the average\ninterest rates of the outstanding bonds for the respec tive quarters. Thus, it can be said that the Exhibit\nKorea – 18 has reflected parts of Exhibit EC – 129, but not all of it. Korea considers that Exhibit\nKorea – 18 is more relevant than Exhibit EC – 129 when finding the benchmark.\n\n171. Regarding Exhibit Korea – 16, are “KEB”, “CHB” and Hanil Bank public bodies? If\nnot, are they “entrusted or directed” private bodies? Please explain.\n\nResponse\n\n KEB, CHB and Hanil Bank (currently W oori Bank) are commercial banks operating under\nthe Banking Act which is generally applicable to all commercial banks. For the transition period\nduring the Asian Financial Crisis and subsequent thereto, the Government of Korea and/or KDIC used\nto hold shareholdings in these banks as they had contributed capital in the framework of the financial\nsector restructuring.\n\n As submitted by Korea in relation to the concep t of “public body”, a two-step analysis is\nrequired: i.e. (i) an entity will be a public body if it is empowered by the law of the State to exercise\nelements of the governmental authority and (ii) the acts in question will be considered acts of the State\nonly if such entities were acting pursuant to such aut hority in the particular instance. Relating to the\nfirst step, there are no laws which empower the banks referred to above to exercise elements of the\ngovernmental authority. Further, when issuing the APRGs, these banks exercised no governmental\nauthority. In light of this, these banks cannot be regarded as public bodies for the purpose of the SCM\nAgreement.\n\n In order for the entrustment/direction to be est ablished, the following three elements are to be\nsatisfied: (i) an explicit and affirmative action be it delegation or command; (ii) addressed to a\nparticular party and (iii) the object of which acti on is a particular task or duty. The EC has not\nestablished a prima facie case as to the entrustment/direction of the above banks to issue the APRGs\nconcerned. Further, the EC has never specified any particular “function” that a private body was\nallegedly entrusted or directed by the Government of Korea to carry out. Korea reiterates that the\nrequirements of Article (a)(1)(iv) are met only wh en it is established that the private body was\nentrusted or directed “to carry out one of more of th e type of functions illustrated in (i) to (iii) above\nwhich would normally be vested in the government and the practice, in no real sense, differs from\npractices normally followed by governments.” Korea does not see any governmental practice involved\nin the issuance of APRGs. Importantly, beyond gene ralized assertions that at times border on crude\nstereotyping, the EC has offered no evidence of an explicit and affirmative delegation of command\naddressed to the specific banks ordering them to provide subsidies.\n\nC. ALLEGED ACTIONABLE SUBSIDIES\n\n172. Please comment on paras 504-509 of the report of the GATT panel in United States -\nImposition of a Definitive Countervailing Du ty on Imports of Certain Steel Products\nOriginating In France, Germany, and the United Kingdom.\n\nResponse\n\n Korea looks forward to seeing the EC’s res ponse to this question and Question 148. There\nare several ways of distinguishing the Steel CVD case. Unfortunately for the EC, all of them cut the\nwrong way and would support the EC’s inside investor standard proposed in th at case. Korea notes\nthat the first point to take from the Steel CVD case is that it illustrates a couple of the differences\nbetween equity infusions and debt equity swaps in insolvency.\n\n The whole issue of whether an inside investor or an outside investor would put further funds\ninto a company in the form of equity infusions de pends on an analysis of the possibility of achieving\ncomparable rates of return on the marginal amounts of new investment. The EC was arguing that an\ninside investor has a somewhat different pers pective because it will take into account the funds\nalready invested when adding new marginal amounts. That is, if the new money can optimize returns\non previously invested amounts, then the inside investor will be willing to possibly accept a lower\nnominal rate of return on the new investment. In effect, the inside investor looks at the new\ninvestment as a catalyst for a better return on the full investment. However, an outside investor,\n\naccording to the EC does not have that perspec tive of seeing new funds serving a catalytic function\nfor a larger initial investment and therefore will requi re a higher rate of return on the new investment\nthat it views in isolation. In essence both investors are acting on a rational market basis; it is simply a\nmatter of different perspectives.\n\n In the case of an insolvency, however, there is no new money being invested. The goal is to\nmaximize the return on whatever was already lent, recognizing that it will in all cases be – at least in\nthe short term – a negative return. The inside/outsi de investor discussion serves as an analogy for this\ndecision making process. The foreign creditors who ha ve a very small stake in the business are less\nwilling to deal with the legal and workout processes in another country. There is an administrative\ncarrying cost for getting involved in such processes that can be quite high. On the other hand,\ndomestically-based creditors that have a larger e xposure both to the company and to the market in\ngeneral are in a position analogous to an inside investor who has a much larger stake to protect and for\nwhom the carrying costs of dealing with a Korean insolvency are significantly less than the foreign\nlender. In addition , just as the incentives are differe nt, the leverage is different. The party that has a\ndesire to get out and has a relatively small expos ure can block the process in a manner that would\nbring disproportionate pain to the inside lenders. Thus, by using this levera ge, the foreign creditors\ncan obtain a higher initial payment on their debts from other creditors. But the issue does not end\nthere in the case of DSME for the outside lenders asked for a residual amount of out-of-the-money\nwarrants. If one steps back and looks at the tran saction as a whole, the inside lenders took less up\nfront, but a larger long term potential benefit throug h the equity they received in exchange for their\ndebt. The outside lenders took a larger initial amount and settled for a smaller long-term potential with\nthe warrants thereby minimizing their risks and carry ing costs for dealing with a Korean insolvency.\nThus, both sides took similar amounts out of the transaction but in different forms. Both acted as\nperfectly rational creditors or “investors” reflecting their different perspectives as domestic/inside and\nforeign/outside players.\n35\n\n Korea also notes that it does not have the benefit of seeing the academic report the US relied\nupon in the Steel CVD case, but the description of it sounds abstract in the extreme and, therefore, of\nlimited use. It is a highly academic exercise to posit that two parties are in precisely the same position.\nNo persons have exactly the same perspective and no persons have perfect information upon which to\nbase their decisions. That is why there are negotia tions. If this were not the case, the Doha Round\nwould not just have begun at Doha, but would also have ended there fo r all of the perfectly informed\nrational Member representatives would have been ab le to instantly settle their differences. There\nwould have been no different perspectives if the hypothetical were followed because everyone would\nbe in identical positions. Of course, the real world does not operate that way and did not in the Korean\nworkouts. The parties bargained to obtain the best results they could in diffi cult circumstances. They\nset their goals according to their specific needs and used what leverage they had to achieve them as\nbest they could. Thus, the EC’s argument regarding the different perspectives of inside investors in\nthe case of equity infusions applies even more strongl y in the case of different creditors in the case of\ninsolvency workouts.\n\n In light of the above discussion, Korea also w ould like to point out another issue illustrated by\nthe comparison of these issues in the Steel CVD case with the current workouts. As Korea has noted in\nits submissions and the Substantive Meetings, there is no transfer of funds in the present case. The\ndebt was valued by the lenders and the negotiatio ns to carve up the remains of the company were\nundertaken based on their respective valuations. There were no new sources of funds to pay any of the\ncreditors. Thus, for the EC to say that the domes tic creditors took too little for their debt simply\nignores the point that there was nothing more there for them to get. It was merely a question of\nallocation between creditors . The only possible source of extra funds would have been if the\nvaluation exercise had resulted in a determination that the termination and selling for scrap of the\n\n35 Korea notes that the Lawes Report, Exhibit Korea – 105, supports this conclusion.\n\nassets would have yielded more funds than doing the workout. No creditors -- either domestic or\nforeign, insiders or outsiders -- came to that conclusion.\n\n Korea also notes that in some cases a litigant will abandon an earlier position if it loses that\nargument. In the referenced pane l report, however, the EC did not “lose” the point. Rather, the Panel\nexplicitly was deferring to the administering author ity regarding the insider/outsider argument. In\nparagraphs 466 and 490, the Panel noted that it w as not up to it to make its own judgments about the\nweight of the evidence. In paragraph 503, the Pane l noted that it was the Panel’s duty to see whether\nthe EC had established that the administering author ity had not acted on a ratio nal basis. In paragraph\n507 the Panel noted that there might be circumstance s where inside and outside investors might have\ndifferent perspectives. In paragraph 508, the Panel noted that the EC had presented a possible\nalternative approach, but that was not enough when the task of the Panel was examining whether there\nwas a failure of the DOC to consider relevant facts (the DOC also claimed that it had in fact\nconsidered some of the factors put forward by th e EC). Thus, the EC did not lose the point as to\nwhich was a better approach. Rather, the EC was me rely unable to assert that the approach it put\nforward was the only rational approach. In contrast , this Panel is not reviewing an administrative\ndecision and, therefore, must make its own judgm ent about which approach is best. If the EC now\nabandons its earlier position it is, to say the very least , opportunism practiced at the expense of logic\nand consistency.\n\nD. SERIOUS PREJUDICE\n\n173. (a) For each of the three ship types at issue in this dispute, how are ship data\nnormally maintained by the industry, and by industry analysts?\n\nResponse\n\n Industry data for ships and shipbuilding is ma intained and held through detailed electronic\nship databases, including:\n\n - LR Fairplay Register of Ships,\n - LR Fairplay World Shipping Encyclopedia/PC Register/ Newbuilding Register,\n - Clarksons Ship Registers (available for Bulk Carriers, Chemical Tankers, Gas\nCarriers (only LPG), Containerships (i ncluding multi-purpose and Ro-Ro ships),\nOffshore Service vessels, Reefers, and Tankers).\n - Marbase\n\n These electronic databases comprise individua l ship records for completed ships and each\nrecord comprises many detailed fields of tec hnical, commercial, opera tional and construction\ninformation. The data in these fields is subject to availability and reflect s the type of ship and\ntechnical characteristics. Ship type and sub-type cat egories are used in all and whilst there is much\ncommonality of data, there is no standard format. Sub-type data provides much greater detail than\nprimary or main ship type groupings and hence users of the data choos e which level is most\nappropriate for their use. The following examples are provided:\n\nLloyds Register Fairplay\nWorld Shipping Encyclopedia/PC Register Register of Ships\nVessel Types Ship Types\nBulker\nCombination\nContainer\nDry Cargo\nMiscellaneous\nOffshore\nPassenger/Ferry\nReefer\nRo-Ro\nTanker (including LNGs)\nBulk Carriers – 14 sub types\nDry Cargo/Passenger – 24 sub types (incl\ncontainers and reefers)\nTankers – 19 sub types (including LNGs)\nOffshore – 9 sub types\nFishing – 9 sub types\nMiscellaneous – 30 sub types\nNon-merchant ships – 4 sub types\nNon-propelled – 2 sub types\nNon-seagoing merchant ships – 13 sub types\nNon-ship structures – 1 sub type\n180 Sub Type codes approx 125 Sub Type codes approx\n\n The tables attached in Exhibit Korea – 130 show the groupings of ship types used in the LR\nFairplay World Fleet Statistics which is also used in LR Fairplay Quarterly Shipbuilding Statistics. In\nthis Exhibit, it can be seen that the chemical/o il product tanker category is included with chemical\ntankers in the basic grouping of the chemical ra ther than oil tankers reflecting the significant\ncomplexity that IMO chemical requirements bring. This contradicts the EC’s attempts to include\nchemical/oil tankers with pure oil products tankers.\n\n Common ship-type specific informa tion held in databases includes:\n\n - Containerships – teu capacity, reefer slot capacity, cargo handling gear details,\n - Chemical Tankers – IMO Class, tank cap acities in cu metres, numbers of tanks,\n - LNG Ships - tank capacity in cu m,\n\n There are a huge number of fields covering technical characteristics which are completed\nsubject to data availability. Gross tonnage is a fiel d common to all ship types, deadweight is a field\ncommon to all cargo ships and teu to all container ships. cgt values are sometimes held in some\ndatabase, cgt coefficients in others but cgt values can be calculated from GT. Certain information such\nas price is generally from public sources and so may be only sporadically ava ilable and of variable\naccuracy. These databases also generally hold more lim ited data on ships on order (but not delivered)\navailability of technical and other details is far more spasmodic for these than for delivered vessels.\n\n These electronic databases form the basis of many of the statistical reports produced at time\nintervals and the extensive number of fields ava ilable means that data can be summarized in many\ndifferent ways. These databases are generally ava ilable on subscription and many industry players\n(shipowners, shipyards, and analysts) will have ac cess to these and use them as a key information\nsource.\n\n The importance of these databases is that the availability of information is no longer restricted\nby the format of regular statistical reports and industry analysts can access and interrogate data in\nwhatever form is necessary to ensure accuracy and consistency.\n\n (b) In particular, are these three categori es of ships recognized and used routinely\nfor purposes of industry analysis?\n\nResponse\n\n The basis of most analysis is the electronic da tabases referred to earlier together with market\nintelligence and detailed market know ledge and these are used to prepare certain regularly issued\nreports.\n\n These reports routinely provide informati on based on ship types but do not necessarily\ncoincide with the categorization of containershi ps, product and chemical ta nkers and LNGs proposed\nby the EC which explains why it is, in particular, so difficult to identify the EC’s product category for\nproduct and chemical tankers.\n\n The product chemical and LNG ship types covere d by this dispute fall within the category of\ntankers (as shown in the ship type classification table in the response to Question 173 – a) above),\nwhich is a broad grouping which includes, crude oi l tankers, product tankers , chemical tankers, gas\ncarriers as well as specialist types (again, without an y category for product and chemical tankers). In\nthe LR Fairplay Register of Ships, for example, this includes the following tanker types: Beer,\nBitumen, Chemical/Oil Products, Chemical, Crude Oil, Ed ible Oil, Fish Oil, Fruit Juice, Latex, LNG,\nLPG, Molasses, Oil Products, Oil Sludge, Vegetable Oil, Water, Wine.\n\n General type classification are, however, sometime s inconsistent with detailed technical fields\nas a result of data input or reporting inconsistencies, and as such data must be looked at taking into\naccount the context in which information is required to avoid misleading, inaccurate or incomplete\ndata.\n36\n\n In general terms, the following classifications of tankers are generally widely observed:\n\n• Crude oil\n• Oil Products\n• Chemical37\n• Gas Carriers – which consistently identify LPG and LNG as separate types\n\n As far as containerships are concerned, these are usually referred to separately to other ship\ntypes.\n\n Size bands are used for almost all in-sector an alyses and also for some cross sector analyses.\nExhibit Korea – 131\n shows the use of size bands within ship types on a regular basis in various\nindustry publications. See the response to Question 173(c), (d) and (f) for examples of those\ncommonly used for reporting and analysis purposes. Common statistics are the numbers of\nships/orders, GT (gross tonnage) and dwt (deadweig ht tonnage for cargo carrying ships only) and in\nthe case of containerships teu capacity - this inform ation is used by shipyards and shipowners alike\nand covers both new orders, orderbook and deliveries. Orderbook information is generally shown both\nin aggregate terms and phased by year of delivery.\n\n Cgt (compensated gross tonnage) is of no inter est to shipowners or brokers, but is regularly\nused for certain shipbuilding purposes, namely shipbuilding capacity, aggregated shipbuilding\n\n36 For example, in the preparation of the Drewry reports in Exhibit Korea – 70, 109 and 110, Drewry\nestablished through inspection of the above sources that ships with IMO chemical classes were listed as oil\nproduct tankers and vice-versa. Thus, there was considerable inaccuracy and incompleteness in this respect.\nDrewry therefore made use of various sources to maximize the accuracy and completeness of the\nproducts/chemical tanker category.\n37 Note that in Exhibit Korea – 130 , LR Fairplay include chemical/o il tankers under the category of\nchemicals and not oil products which contrasts with how the EC has used this data.\n\ndemand and shipbuilding output. The choice of whic h parameter to use is determined by the purpose\nfor which the analysis is to be undertaken.\n\n Other characteristics of the vessels such as whet her they are equipped with gearing or have\nreefer capacity may also be taken into account in a number of industry reports.\n\n (c) If so, how are they defined, and for what purposes are these categories used?\n\nResponse\n\n The use of ship type categories is not rigorously defined and therefore reflects the categories\nused by those providing the original data as well as some data input discrepancies. The general\ncategories used are listed in (b) above.\n\n The categories as defined in (b) are used fo r an extensive number of purposes but most\nregularly in reports reflecting numbers of vessels, orders or output by shipyards and shipbuilding\ncountries. The following types of industry analysis make use of these categories which, Korea repeats,\nare significantly more complex than the three broad categories that the EC tries to portray as being\nstandard in industry reports:\n\n - Statistical reports produced at regular time intervals – yearly, quarterly, monthly etc,\nincluding\n\n• LR Fairplay World Fleet Statistics – Annually\n• LR Fairplay Quarterly Shipbuilding Statistics\n• BRL Newbuilding Enquiry – Quarterly\n• Clarksons World Shipyard Monitor – Monthly\n• Drewry Monthly\n• Fairplay Solutions with Newbuildings – Monthly\n• Clarksons Shipping Intelligence - Weekly\n• Ship Price Series (See response to section (c) for details)\n\n - Industry reports – providing commentary and deeper insights as well as data –\nexamples include shipbuilding reports from analysts like Ocean Shipping Consultants\nand Drewry Shipping Consultants\n\n - Brokers reports – with commentary and ad-hoc information on different shipping\nsectors from broking houses such as Fearnleys and BRS\n\n Additionally, there are certain shipbuilding statistics available from international\norganizations such as the OECD although not all co untries submit reports on a regular basis and the\nOECD will often refer to other industry sources for data analysis purposes. Certain information is also\nprovided by government agencies or national industry associations/bodies.\n\n Examples are provided in Exhibit Korea – 131\n of sample sections of the following\npublications to give an indication of the format and parameters used in such reports including the use\nof size bands with ship types:\n\n• LR Fairplay Quarterly Shipbuilding Statistics\n• Clarksons World Shipyard Monitor\n• Drewry Monthly\n• Drewry World Shipbuilding Reports, 1999.\n\n (d) When analysts report on pricing tends, do they normally ref er to prices for each\ncategory as a whole, or for subcategories thereof, broken out, for example, by\nsize and/or other characteristics.\n\nResponse\n\n A number of industry analysts report pricing trends using Ship Price Series 38, in addition to\ncommentary and qualitative reports. The main ones of these are:\n\n - Clarksons Ship Price Series and Newbuilding Price Index\n - Drewry Ship Price Series\n - Lloyds Shipping Economist\n\n Such price information is kept by vessel type and size. The following tables show the vessels\ntypes and sizes for which price series informa tion is available from Clarksons, Lloyds Shipping\nEconomist and Drewry. Whilst other organisations do publish similar information sporadically, these\nare felt to be the main regular sources of publicly available information of this nature. Exhibit Korea\n– 131 includes price series data from Clarksons World Shipyard Monitor and Drewry Monthly\npublications. Other price series data is published in quarterly and annual publications.\n\n It can be seen that in virtually all cases, ship types are broken down by size. Moreover, whilst\nthe individual size categories may vary, there is a certain level of commonality. Key characteristics or\nqualifiers are also provided in some indices such as IMO Class for Chemical Tankers and whether a\nseries is for a geared or gearless ship in the case of containers.\n\nShip Type\nClarksons\nWorld\nShipyard\nMonitor\nLloyds\nShipping\nEconomist\nDrewry Monthly /\nQuarterly or\nAnnual Reports\nOil Tanker /Tankers\n VLCC 300,000 dwt 300,000 dwt 260-280,000 dwt\n Suezmax Tkr 150,000 dwt 160,000 dwt 140-145,000 dwt\n Aframax Tkr 110,000 dwt 110,000 dwt 95-105,000 dwt\n Panamax Tkr 70,000 dwt 72,000 dwt 68-70,000 dwt\n Handy Tanker 47,000 dwt\n Handymax – clean 45,000 dwt\n Products Tkr 40-45,000 dwt\nChemical Tkrs\n 42-45,000 dwt IMO III 42-45,000 dwt\n 37,000 dwt IMO III 37,000 dwt\n 14-16,000 dwt IMO II 14-16,000 dwt\n 5-6,000 dwt IMO II 5-6,000 dwt\nBulk Carriers\n Capesize BC 170,000 dwt 170,000 dwt 150-180,000 dwt\n Panamax BC 75,000 dwt 72,000 dwt 70-75,000 dwt\n Handymax BC 51,000 dwt 51,000 dwt 40-45,000 dwt\n Handysize BC 30,000dwt 45,000dwt 25-30,000dwt\nContainer\n Container 400 teu - geared\n Container 725 teu\n Container 1,000 teu 1,000 teu 1,000 teu - geared\n\n38 A ship price series is where the approximate current price of a particular size of ship is reported and\nrecorded by industry analysts on a regular basis to monitor price trends for that type and size of ship.\n\nShip Type\nClarksons\nWorld\nShipyard\nMonitor\nLloyds\nShipping\nEconomist\nDrewry Monthly /\nQuarterly or\nAnnual Reports\n Container 1,500 teu – geared\n Container 1,700 teu\n Container 2,000 teu 2,000 teu – gearless\n Container 2,500 teu 2,500 teu – gearless\n Container 2,750 teu\n Container 3,500 teu 3,500 teu – gearless\n Container 4,000 teu\n Container 4,600 teu\n Container 5,500 teu – gearless\n Container 6,200 teu\n Container 6,500 teu - gearless\n Container 7,000 teu\nGas Carriers\n LNG 138,000cu m 140,000cu m 125-138,000cu m\n LPG 78,000cu m 78,000cu m 75,000cu m\n LPG 52,000cu m 35,000cu m\n LPG 24,000cu m 15,000cu m\n LPG 8,000cu m 3,000cu m\nGeneral Cargo\n General Cargo 20,000 dwt\n General Cargo 10,000 dwt\n\nOther\n Ro-Ro\n Ro-Ro\n Reefer 10,000 dwt\n\nPrice Index Yes Not routinely\npublished\n\n The price information used to compile these data comes from price reports for individual ship\ntypes from order records and, in the absence of su ch order records, from brokers’ reports regarding\n‘rumoured’ negotiations.\n\n (e) If they provide a range of pricing info rmation at different levels of aggregation,\nhow are these different data series used?\n\n The main level of aggregation is from a range of price series into a single newbuilding index.\nThis is usually done as a mathematical average (or price per dwt average) and not a weighted average\nreflecting the overall composition of the fleet. A single newbuilding index is a basic way of looking at\nwhat is happening overall to shipbuilding prices as opposed to sector or size band specific trends. So\nif a broad range of price series is used and pri ces are rising in some and dropping in others, the\nnewbuilding index trend will be m oderated by this. However, as the price indices do not cover all\nship types and because it is not weighted by the composition of the demand across different types and\nsizes, it has to be used with extreme caution and interpreted in the light of industry knowledge.\n\n Price series are not generally aggregated to pr ovide a single trend for a particular broad ship\ncategory because it is recognized that the differing tr ends between different size bands is a significant\nfactor. Whilst these trend differences may seem small in relation to overall market price movements,\nthey are highly significant to industry players because they demonstrate different underpinning factors\n\nfor different ship sizes. For example, there may be a particular shortage of smaller vessels affecting\nfreight rates and hence ordering trends for these vessels and not larger ones.\n\n Price series are therefore only indicators of wh at is happening for sample ship types which\nwill be chosen to reflect commonly used types or sizes of vessels. Where a range of sizes are given,\nthey are useful to see that trends can be varying differently within the same ship type. When only a\nsingle price trend is given for a particular type this generally means that this is the most popular size\nof vessel in use or that there is not a consistent e nough stream of data for another size to construct and\nmaintain a price series.\n\n Industry players are generally fully aware that price series data must always be used with\ncaution and care.\n\n (f) Please provide documentation (including in particular relevant excerpts from\nthe published industry reports discussed at the second meeting) showing\nexamples of the various breakouts to which you refer.\n\nResponse\n\n Examples provided, in addition to those provide d in the responses to earlier sections of this\nquestion:\n\n• Drewry Annual Shipbuilding Review 2000\n39\n• Drewry LNG Market Review 2003/0440\n• Clarksons World Shipyard Monitor41\n• Clarksons Shipping Intelligence Weekly.42\n\n174. Korea argues that demand should be measur ed in numbers of vessels, and/or workload\nyears (i.e. order backlog) rather than compensa ted gross tons of new orders. The EC responds\nthat cgt is more accurate as a measure of su pply and demand, and that even measured in\nworkload years, demand trends are as represented by the EC.\n\n (a) Could each party explain the technical differences between the two measures,\nand provide further detail as to why it believes its preferred measure represents\na more accurate picture of demand than the other.\n\nResponse\n\n Compensated Gross tonnage (“cgt”) is a measu re developed by the shipbuilding industry as a\nbroad brush estimate of the workload content for th e construction of ships. It is calculated by\nmultiplying the Gross Tonnage value of a ship by a compensation coefficient from an agreed list of\ncoefficients for different types and sizes of vessel s. Gross Tonnage - despite it name is in fact a\nvolume measure which reflects the physical volumetric size of the ship – and not a weight measure. A\ncopy of the OECD agreed list of coefficients is provided in Exhibit Korea – 136\n and it can be seen\nthat the coefficients are applied to broad size bands. Hence, the measure is a crude one and one which\ntakes no account of specification or design differences between similar ships.\n\n The measure was developed to allow cross s ector assessments for the purposes of assessing\nand recording total shipbuilding activity levels and assessing capacity versus demand. Using this\n\n39 Exhibit Korea – 132.\n40 Exhibit Korea – 133.\n41 Exhibit Korea – 134.\n42 Exhibit Korea – 135.\n\nmeasure it was possible for example to aggregat e demand for passenger ships with that for bulk\ncarriers or for containerships and tankers. It wa s never intended for ship-by-ship comparisons, for\ndetailed market demand analysis or as a mechanis m for looking at price influences by like product\nvessels.\n\n Korea agrees that overall shipbuilding demand (i.e . cross ship type aggregate demand) is best\nconsidered in terms of cgt when looking at the leve l of shipbuilding activity overall. Similarly, overall\nshipbuilding capacity is best measured (however problematic a rigorous assessment is) in terms of cgt.\nIn this fashion, an estimated aggregated supply- demand balance can be considered which inevitably\nneeds to be a reflection across ship types. However, it is well recognized by the industry that the\nsupply-demand balance is not the only or dominant factor in terms of price influence.\n\n The difference of opinion between Korea and the EC relates to determining which sectors\nKorean and EC yards compete in, what the price influences or influencers are and the interpretation of\nsupply-demand balance indicators. Korea believes it is necessary to concentrate on numbers of orders\nand timeframe of those orders when looking to dete rmine the market strength of a yard and its ability\nor likelihood to influence prices.\n\nOrderbook phasing and timing of new Orders\n\n Firstly, in respect of the interpretation of supply-demand balance, the true supply-demand\nbalance can only be determined by looking at th e phasing of orders over the orderbook timeframe.\nThe level of the orderbook in itself cannot indicat e what level of supply-demand balance exists,\nneither can it indicate the market share of any particular market player over the orderbook period.\n\n By way of example and ignoring the issue of work-in-progress: if world shipbuilding capacity\nis for simplicity, sake assumed to be 25 million cgt, and the orderbook is 75 million cgt, what does\nthat mean? If this orderbook is phased over three y ears then in simple terms it would indicate full\ncapacity, if however it is phased over 5 years it represents a significant shortfall of demand against\ncapacity. Furthermore, without looking at the phasing of that orderbook it cannot tell us whether there\nis excess capacity in the early years or whether this is simply the feathering of demand as it fades out\ngradually at the ends of the orderbook following a period of full utilisation.\n43\n\n The delivery timescale of an order has to be take n into consideration in order to determine the\ntrue supply-demand balance for a delivery at a given date. Two orders placed in the same month but\nfor different delivery dates reflect different dema nd-supply balances. A highly competitive yard with\na long orderbook may not in fact be able to quote for an owner who needs a ship quickly – in this case\na less competitive yard with a shorter orderbook may quote possibly at a low price to win work (to\navoid underutilization). Alternatively, an owner with an existing order for that delivery may decide to\nsell his delivery slot at a premium price. The price le vel in this situation is clearly not influenced by\nthe yard with the long orderbook. Timing of the orderbook is therefore clearly important. Exhibit\nKorea – 132 shows that demand projections are phased over time. Exhibits Korea – 134 and 135\nshow that orderbook is reported in industry publications showing phasing over time.\n\n Similarly, it is clear that if one country has 50 per cent of the orderbook at the present time\nthis does not indicate that they will eventually have delivered 50 per cent of the output, it depends\nover what period of time their orderbook is spread in comparison to other countries. It is a recognized\nfact that the timescale of orderbooks and the lead time on orders can vary significantly from country\nto country. Korea believes theref ore that in considering the curr ent orderbook it is always necessary\nto consider the time horizon of this and how this can vary from yard to yard and country to country.\nThis is why the EC’s assessment of market position in Attachments E – 2 and 6 of the EC’s responses\n\n43 In reality of course it is further complicated by what proportion of that orderbook is already under\nconstruction and over what period of time this will be delivered.\n\nto the first Panel questions based on a snapshot situ ation in January 2004 gives no accurate picture of\nthe actual comparative market strength of any shipbuilding country or individual shipyard.\n\n The level of new orders or order intake is a cl earer indication of who is actively contracting at\na particular time and hence who is actually winning c ontracts at a particular price level. If a country\nor yard has a full orderbook for e.g. the next three years, it may decide not to take on further orders\nand therefore may cease winning orders in that year. In this situation, it is likely to have a high share\nof the orderbook, but as it is not actively signing up new orders it is difficult to see how it can be a\nmajor influencer of prices at that time. Korea therefore does not agree that an orderbook is a\nmeaningful indicator of who can influence prices.\n\nUse of cgt versus number of vessels\n\n Consideration of the market in cgt without size bands means that it is not possible to\ndifferentiate between a single order for a large ve ssel and multiple orders for smaller vessels – Korea\nbelieves that these situations need to be considered differently. For this reason, Korea believes that it\nis the number of orders placed at a particular time for ships of a given type and size that needs to be\nconsidered. To provide an example: a workload of 60,000 cgt in the container sector could, without\nany further qualification, equally represent one or der for a 7,500 teu ship or 12 orders for 500 teu\nships or some other combination.\n\n To understand why Korea believes it is the numbe r of orders within a particular size range\nthat should be considered to assess market share a nd influence, rather than the total workcontent\nacross all size bands, we offer an example. Consid er the situation when an owner wishes to place an\norder for say a 7,500 teu containership. This is a large vessel measuring around 320m in length and\n43m in width and many shipyards will not have su fficiently large building facilities to construct a\nvessel of this size (although they may regularly build smaller container ships that are within their size\ncapability). The owner will therefore be considering on ly those yards that have the physical capability\nto build such a large vessel, and of these there will be a list of yards which have experience in such\nvessels and which are considered to be most comp etitive for this type of vessel – these will be the\npreferred yards.\n\n At the same time another owner is looking to place an order for a 500 teu containership, this\nis a much smaller ship at around 120m in length and 20m in width. There are a much larger number of\nyards with smaller facilities that will be capable of building of and have experience in building such\nvessels. Whilst the larger yards can also build this size of vessel it is not economic for them to do so\nas it results in poor utilization of the dock or building berth (to be partially occupied by such a small\nvessel) and other production facilities. Furthermore, the larger yard knows there will be much higher\nlevels of competition for this ship. So it is highly unlikely that either the owner or the larger build\nyards will be seriously contemplating the placing/winning of this small ship order at a larger shipyard.\n\n In terms of end use, the 7,500 teu containers hip will be used on the major long haul high\nvolume container routes, typically running East – W est, between large dedicated container ports with\nhighly sophisticated in-port container handling cran es. The smaller ship will however be operating on\ncoastal or feeder routes on low volume trade routes, typically between smaller ports that do not have\ndedicated specialized container handling facilities. It would not be physically possible for the larger\nship to access the smaller ships’ ports and clearly on a low volume route it would run nearly empty\nand have no on-deck cranes to unload its cargo. Th e smaller ship, could operate on the bigger ships\nroutes. However, its operating costs would make it highly uneconomic, its speed would mean it could\nnot maintain the schedule and of course it would need lots of these ships to handle the total cargo\nvolume.\n\n In this scenario, the smaller ship will be built in different yards to the bigger vessel and will\noperate on different routes. So with no supply or demand side commonality it is difficult to see how\n\nthe price of one could depress, suppress or inflate the price of the other. The consideration of cgt,\nrather than numbers of vessels, without reference to size bands would assume that not only would the\norder, and hence builder, of the larger ships have an impact in the separate market of the smaller ship,\nbut its impact would be around 12 time greater (with a value of around 60,000 cgt) than that exerted\nby the builder of the smaller vessel (with a value of around 4,500 cgt). Why would an order for a very\nlarge vessel placed with a yard that would not build the smaller vessel influence the price asked by the\nsmaller yard that could not build the larger vessel?\n\n In contrast, the consideration of numbers of orders placed within broad size bands, recognizes\nthe supply side and demand side commonality of su ch vessels, which will operate on similar routes\nand be built in yards with similar size and experi ence capability. It is therefore possible that similar\nfactors will affect the prices of these vessels whethe r they be the supply side factors e.g. shipyard\nsupply-demand balance or the demand side factors e.g. freight rates. In this situation however it is also\nimportant to consider the timing of both order and delivery.\n\n One final note is that the EC’s point th at considering small and large vessels purely on\nnumbers leads to a small fishing boat yard becoming the price leader, is clearly erroneous. Firstly, all\nanalysis on the basis of numbers is being looked at within a given ship type and, secondly, it is being\nconsidered in terms of size bands, and so orde rs for small fishing boats will not come into\nconsideration when considering price influences for containerships be they large or small.\n\n Therefore in summary in simply looking at a ggregated demand-supply balance then cgt is the\nappropriate measure, and to assess levels of utili sation, the orderbook must be phased over time to\ncompare it with capacity.\n\n In terms of determining who or what influences prices, it is necessary to consider the\ntransactions that are taking place rather than the vol ume of work, the size bands that different yards\nare active in, and the level of ordering activity that is going on at the current time. It must be\nremembered however that those orders may be be ing placed on different timescales and hence against\ndifferent supply-demand balances.\n\n (b) Which measure is used by industry analysts and the industry when analyzing\ndemand trends?\n\nResponse\n\n (i) Shipbuilding demand is driven by two f actors; Firstly replacement, i.e.: demand for\nships going out of service and, secondly, expansion demand due to projected increase\nin cargo-miles (i.e. cargo volumes x shipping distances). Demand for cargo ships,\ntherefore, has to be assessed in terms of cargo carrying capacity and the base\nmeasures are, therefore, cargo measures such as deadweight, teu, or cubic metres of\ngas, depending on which ship type is under consideration. This demand then has to be\nconverted into the numbers and sizes of ships. Exhibit Korea – 132\n shows examples\nof ship type specific demand projection in cargo volumes and size bands.\n\n To calculate aggregate demand this has th en to be turned into GT demand by each\nship type and size and then again into cgt by applying the relevant compensation\nfactors to the GT volumes. Shipbuilding demand cannot be projected in cgt directly.\nExhibit Korea – 132\n shows aggregated shipbuilding demand projection in cgt and\nnumbers of vessels.\n\n (ii) Monitoring of shipbuilding output, howe ver, is generally done in terms numbers of\nvessels, GT and deadweight for most cargo ship types and also in terms of teu and\nCU metres for containerships and LNG and LPG gas carriers. Exhibit Korea – 131\n\nshows examples of dwt, teu and cu metres as well as numbers of ship/orders.\nShipbuilding output is also monitored in cgt and this is done by applying the\nappropriate compensation coefficient for the ship type and size to the GT value.\n\n (iii) Shipbuilding capacity is assessed in cgt and the OECD agreed methodology for doing\nthis is to assess yard capacity based on th e ship types and sizes currently being\nproduced and reflecting current productivity or delivery performance in terms of the\ntime taken to construct such ships types. Hence a yard or country’s capacity will alter\nif it alters the type of vessels that it ge nerally builds or its performance in building\nthose.\n\n (iv) Industry analysts compare shipbuilding capacity and projected capacity in cgt with\nactual shipbuilding output and projected shipbuilding demand in cgt in order to\nconsider the supply-demand balance and capacity utilization.\n\n Whilst shipbuilding output and projected demand can be considered by ship types,\nshipbuilding capacity cannot be segmented on this basis because yards may build a\nlimited range of different ship types. Ship type specific supply-demand balances\ncannot therefore be developed.\n\n (v) Very little if any analysis is done into who influences prices and so there are no easy\nbenchmarks to compare against. The analysis of price tends to be either a simple\nindication of what is happening to the price rather than why it is happening or simply\noffers qualitative commentary.\n\n Korea reiterates that measureme nts used in the industry to reflect demand such as cgt cannot\nbe transposed to determine market position and the capability of yards to influence prices. There are a\nrange of supply and demand side factors or external factors that can influence prices. Prices can be\ninfluenced by any or all of these (and other) factors at any particular time. Supply-demand balance is\nnot the only or necessarily dominant factor. Analysis of price trends may tend to look at the various\ndifferent factors, and the basis of analysis will reflect that perspective. However, in this situation it is\nnot looking at the impact of a particular yard or group of yards but simply the contributory effect of\none factor on ship prices. Factors such as stee l prices and exchange rates are not sector specific,\nwhereas factors such as freight rates do have sector specific dimensions. Freight rates and ship prices\ndo however show different trends within different size bands within a particular ship type.\n\n In the previous section an explanation is provided to explain why Korea feels that it is more\nappropriate to consider the numbers of orders, ship type and size bands rather than simply the ship\ntypes and cgt volume. In the following question Korea explains why market shares should be\nconsidered in similar terms of considering price suppression or depression allegations.\n\n (c) If both are routinely used, please ex plain the circumstances in which they are\nused, and provide examples from independently prepared sources (the published\nindustry reports discussed at the meeting, OECD documents, etc.).\n\nResponse\n\n Numbers of ships, deadweight, GT and cgt ar e only routinely used for shipbuilding demand\nprojection and output monitoring a nd not for analysis of price influences. Various examples have\nbeen provided showing output monitoring reports and order volumes and orderbooks.\n\n Exhibit Korea – 131\n shows orderbook, completions and new orders by numbers of vessels\nand cargo measures (deadweight, teu and cu metres) according to ship type and size.\n\n Exhibit Korea – 134\n shows ship deliveries reported by number of vessels, deadweight and\ncgt in for different ship types and size bands, and with orderbook (future deliveries) phased over\ntimescale.\n\n Exhibit Korea – 135\n shows orderbooks by ship type and size bands measured in numbers or\nships and cargo volumes and with orderbook delivery phased over timescale.\n\n175. In response to EC arguments concerning ma rket share as a factor in price leadership,\nKorea variously states that market share does not demonstrate price leadership, but also that\nKorean yards’ market shares are too small for them to be able to influence prices. Both sides\nthus seem to view market share as somehow relevant to the question of price leadership.\n\n (a) How (on the basis of what sort of concrete data and analysis) can price\nleadership be determined/established?\n\nResponse\n\n Korea considers and has consistently taken the position that the market share of the allegedly\nsubsidized shipbuilders is one of the indicators to take into account in determining whether it is the\nalleged subsidies that have a price depressive or suppressive effect (refer to Korea’s response to the\nPanel’s Question 91(d) at pages 46 and 47) but is no t solely sufficient to show a price depressive or\nsuppressive effect due to the subsidies themselves. The allegedly subsidized Korean shipbuilders\nalone did not occupy such a market position that they could lead prices for each of the product\nsegments concerned because the EC or other shipbuil ders had comparatively equal or stronger market\npositions or because of fluctuations in market sh ares (refer to Korea’s First Written Submission at\npages 228 to 231 as well as its Second Written Submission at pages 105 to 110).\n\n In order to determine whether subsidies have caused any price depression or suppression\nthrough the allegedly subsidized yards acting as pr ice leaders, Korea submits that all the steps\ndescribed in its response to Panel Question 91 shoul d be followed. The concrete data and analysis\nindicated therein should be compiled and assessed so as to determine whether it was the alleged\nsubsidies that caused price depression or suppression, i.e. including the compilation of the demand\nand supply factors, the effect of prices of other non-subsidized shipbuilders or the effect of the prices\nof the subsidized shipbuilders.\n\n (b) What role in such an analysis would levels and trends in market shares play?\n\nResponse\n\n In Korea’s view, levels and trends in market share play a dual role as explained in its response\nto Question 91(d), i.e.:\n\n - if, with respect to each like product, there are a number of non-subsidized\nshipbuilders which collectively have sufficien t market shares to be able to lead or\nsubstantially influence the setting of the market prices, then the prices charged by\nthese non-subsidized shipbuilders will constitute the ceiling of the prices that can be\ncharged by the EC shipyards, regardless of the effect of the alleged subsidy in\nquestion.\n\n - if with respect to each like product, the allegedly subsidized shipbuilders have\nsufficient market shares to be able to l ead or substantially influence the setting of\nmarket prices, one should proceed to comp are the prices of the vessels sold by the\nallegedly subsidized shipbuilders with t hose of the non-subsidized shipbuilders to\ndetermine whether the subsidies have ha d price depression or suppression for their\n\neffect. If the market share of the allegedly su bsidized shipbuilders is insufficient or if\nthese shipbuilders have not maintained a substantial market share consistently, no\nsuch price comparison need to be made as it will be impossible to establish a causal\nlink of sufficient strength between the existence of the alleged subsidies and any price\ndepression or suppression. Moreover, this exerci se requires a detailed cost analysis to\ncompare any cost advantages to the size of the alleged subsidy and, in turn, a\ncomparison to the other prices offered. The onl y alternative is a “but for” analysis to\nthe effect that but for the subsidy the ya rd’s capacity would have completely exited\nthe market. In fact, that was what the EC was trying to rely on exclusively before it\nimproperly attempted to reintroduce price undercutting again.\n\n (c) How large a market share would a given market participant need to be able to\nexercise price leadership.\n\nResponse\n\n No simple figure can be given as to the thres hold which is sufficient for a market participant\nto be able to influence prices. This will depend on the product and the market concerned. In the\npresent case of commercial vessels, the relative mark et share of all market participants and,\nseparately, of the allegedly subsidized shipyards mu st be determined over a sufficient period of time\nand for each product separately. A relatively equa l or stronger market share of non-subsidized\nparticipants will be a strong indicator that the a llegedly subsidized shipyards cannot have exercised\nprice depression or suppression. In addition, in a highly fragmented market characterized by many\nmarket participants, a very low market share may be sufficient whilst in other cases, when the number\nof market participants is relativ ely small as in the present case, a much higher market share will be\nrequired to exercise price depression or suppression.\n\n The period of time over which market share is held should be sufficient in order to determine\nthat there is an established market position; a shor t-term increase in market share as such will be\ninsufficient to establish a price lead ership in terms of price depression or suppression. In addition, in\nthe case of an inquiry into subsidies, market shar es must be investigated over a period of time\npreceding the bestowal of the alleged subsidies and th ereafter in order to determine whether there is a\ntimewise coincidence between the occupation or th e maintenance of a market share of sufficient\nstrength and the granting of the subsidies.\n\n It is on this basis that Drewry has drawn its conclusions on the possibility for the three\nallegedly restructured yards to depress or suppress prices of the EC like product vessels in its report\nsubmitted as Exhibit Korea – 110.\n\n In Exhibit Korea – 115, Korea summarized the findings of the EC’s consultant FMI from\ntheir ‘Background report – Detailed evaluation of key price movements’ dated August 2003\n(Annex 5a of the Annex V responses). Whilst Korea reserves its position in respect to a number of\nfindings of this report, it is clear from this that th e EC’s own interpretation of price leadership was in\nno way consistent with the market share of the alleged price leaders. It is also noted that in six out of\nseven categories FMI identified that Korea was not the lowest price competitor.\n\nIV. TO THIRD PARTIES\n\nA. ITEM (J) I ITEM (K), FIRST PARA.\n\n176. The parties disagree on whether or not AP RGs and PSU constitute export credit guarantees\nand export credits respectively. The EC submits that they do not, whereas Kore a asserts that they do.\n\nWould your export credit agency treat APRGs as export credit guarantees, and PSLs as export\ncredits? Please explain and provide relevant documentation.\n\nKOREA’S COMMENTS WITH REGARD TO\n\nATTACHMENT EC – 8\nATTACHMENT EC – 9\nEXHIBIT EC – 146\nEXHIBIT EC – 147\n\n1. Comments with regard to Attachment EC – 8\n\n The EC’s detailed points on the Drewry report submitted in Exhibit Korea – 70 run to some\n20 pages of comments from which it is simply not possible to derive coherent lines of argument or\ncomment. Many of the points concentrate on irre levant issues, are repetitive or not intelligible.\nBeyond these issues on which Korea disagrees but whic h it considers are not of prime relevance, the\nfollowing issues are important most of which are, in fact, reflected in the Panel’s questions to which\nKorea responded in the present document or on which it commented when the question was addressed\nto the EC. These are the following:\n\n (i) The fact that no accurate assessment on price depression or suppression can be\nprepared with regard to containerships , product and chemical tankers and LNGs\nwithout a strict like product identification taking into account the size and the use of\nthe vessels. Korea has shown in its responses to Panel Questions 173 that\nshipbuilding industry publications do not always identify separately the three product\ncategories referred to by the EC (in partic ular, the product and chemical tankers) and\nthat industry publications do most often identify separately the different sizes of\nvessels as well as certain other characteristics (such as gearing or reefer capability)\nincluding when prices are reported.\n\n Korea confirms that there are clear di fferences in end-uses between the like product\nvessels that were identified in the Drewry report in Exhibit Korea – 70 as elaborated\non in Exhibit Korea – 108. In this regard, th e EC’s claim that the end use of a vessel\ncan change during its lifetime is not grounde d in fact: post panamax container vessels\nwill not change to be used as small coaster feeders no more than oil products will be\ntransported in chemical tankers.\n\n (ii) The fact that the market strength of th e allegedly subsidized Korean yards must be\nassessed based on the number of vessels ordered with them over a representative\nnumber of years preceding and following their corporate restructuring. Korea has\nelaborated on its response to Panel questi on 174 on the grounds that render CGT and\nthe orderbook on 1\n January 2004 inadequate to assess market strength such that the\nyards could influence prices. CGT is consid ered the proper standard of measurement\nfor overall shipbuilding demand and capacity thus allowing an assessment on the\naggregated supply-demand balance. However, as the measure is developed for an\nacross sector assessment but not for ship-to-ship comparisons. Consideration of the\nmarket in CGT without size bands does not allow to properly assess market strength\nfor price assessment purposes and is not used for this purpose in the industry.\n\n (iii) The fact that the allegedly subsidized Korean yards and the EC yards compete as\nregards different like product vessels. A detailed Drewry report has been submitted in\nExhibit Korea – 110 showing for each like product, the number of vessels sold by the\nEC and the allegedly restructured Korean yards. This clearly indicates that these\nKorean yards have primarily sold like product vessels that were not or hardly sold by\nthe EC yards and this already during the period well preceding the bestowal of the\nalleged subsidies.\n\n2. Comments with regard to Attachment EC – 9\n\n The EC started its Attachment – 9 based on the Attachment 4 to Korea’s Second Written\nSubmission. However, as the recalculation provided in the EC Attachment – 9 is incorrect, it does not\nprove that a benefit was conferred. The fallacies ar e the following: (i) the EC erroneously equated a\ncorporate bond rating “C” with a KEXIM credit rating “SM”; (ii) the EC misunderstood the structure\nof KEXIM interest rates; and (iii) the EC did not reflect the early repayments by DSME of its debt.\nKorea will discuss each issue briefly.\n\n(i) Erroneous equation “C” with “SM”\n\n As detailed in Exhibit Korea – 91, the cor porate bond ratings by outside rating agencies and\nKEXIM credit ratings are incompatible. Not only ar e the underlying risks different, but the grading\nfactors are as well. Korea would like to note that such incompatibility resu lts in “mismatches” of\nKEXIM credit ratings and bond ratings shown in Ex hibit Korea – 92. Indeed, while KEXIM graded a\ncompany with P4, P5 or SM, a credit rating agency rated the company’s bond with rating “C”. The\nsimilarity on rating definitions only cannot justify the inherent distinctiveness of the ratings.\n\n(ii) Misunderstanding of KEXIM interest rate structure\n\n As submitted in Korea Response to Panel Qu estions 47 and 73 and Exhibit Korea – 93,\nKEXIM interest rates were determined by adding up the base rate plus the then applicable spreads\n(target margin, credit risk spread, mark et adjustment rates, etc.). When Yangdo Dambo was provided,\nthe “credit risk spread” was decreased by 50 per cent. Notwithstanding this, the EC appears to\ncalculate the rates by adding up the base rate plus 50 per cent of credit risk spread only, which is\nincorrect. For all transactions referred to in EC Att achment – 9, KEXIM determined the interest rates\nbased on “WNPRI 6month” the base rate plus spread of 1.96. The spread is composed of a credit risk\nspread of 0.15 (50 per cent of 0.3 which was the then applicable credit risk spread) and an adjustment\nspread of 0.46. (See page 2 of Exhibit Korea – 93)\n44\n\n(iii) Early repayments\n\n Also, DSME made early repayments of its PSLs for projects 000145P and 000146P. This\nresulted in small amounts of interests incurred ( See Attachment – 4 to Korea’s Second Written\nSubmission). While the EC did not have this info rmation regarding early repayments by DSME, it\nshould nevertheless have been more cautions and raised the issue after reviewing Attachment\nKorea - 4.\n\n3. Comments with regard to Exhibit EC – 146\n\n3.1 Contrary to FMI’s statement in Section 2.1 of the Exhibit EC – 146, Korea does not qualify\nthe cost modeling done by the EC team as being lightweight. Certainly, a significant amount of efforts\nhas gone into the calculations made but it remains as the EC claims itself that the cost modeling\nprocess is based on “assumptions” in which shipbuilding costs have been estimated or assumed to be\nat a certain level. No amount of effort and resear ch will fundamentally alter the inherent accuracy\nlimitations of the model. The inaccuracy of th ese assumptions has been demonstrated in Exhibit\nKorea – 108 in which KPMG has made a cost analys is of certain LNG carriers built by DSME. This\nreport shows that the actual costs amounts and th e FMI assumptions/estimations are strikingly\ndifferent primarily as regards the following:\n\n44 Korea corrects that the commitment dates for all projects concerned were 21 December 2000 , not\n21 December 2001. The “adjustment spread” had been effective until it was replaced with the “market\nadjustment rate” in June 2001.\n\n - material costs\n - labour cost\n - license fee\n - overhead and SG&A\n - debt service costs\n - non-operating expenses.\n\nHence, these estimations, proven wrong with the ac tual figures, cannot be the basis for a conclusion\nthat the costs of the allegedly subsidized Korean ya rds have increased to such an extent that prices\nshould have increased and, hence, that price suppression or depression existed. Furthermore the\ninherent inaccuracy of the model has been demonstr ated by the level of revisions/recalculations that\nthe EC/FMI have already made in their detailed reports. As a matter of fact, nowhere do the EC or\nFMI indicate the link between the results of the cost model and the conclusion that the overall costs\nincreased since the time when FMI started preparing the cost model.\n\n When describing the approach to the treatment of overhead costs in the model, it is stated that\nthese are spread evenly (t he basis of allocation is not however discussed) across the full output of the\nshipyard and states specifically: “If this is not the case it would have to be shown that some\nproportion of the workload is capable of contri buting more than its average share of overhead\nburden.” This seems curious when elsewhere, EC a nd FMI have gone to considerable effort to then\nseparate out that certain investments and overhead cost s must be specially attributed to LNG, and has\nthen struggled to come up with sensible ship seri es numbers over which to attribute this for Korean\nyards in comparison to EC yards. Furthermore elsewhere the EC has made strenuous efforts to\nsuggest that shipyard supply has full substitutability and that any yard can build any ships type but it\nsimultaneously advises the hearing that of the special skills and investment needed for LNG and that\n‘not any yard can build an LNG ship’. In fact, it is the EC and FMI’s arguments that seem to change\ndramatically depending on what it wants to prove and this is all within the confines of this case.\n\n The EC and FMI try to portray it as if Korea a nd Drewry had omitted to take depreciation and\ndebt-servicing costs into account when concluding th at Korean costs decreased instead of increased.\nHowever, in the first place, the EC and FMI did not show that depreciation and debt-servicing costs\nincreased over the relevant period of time in order to substantiate their finding that prices should have\nincreased and, in fact, as mentioned in Exhib it Korea – 108, DSME by paying its debts early,\ndecreased its debt-servicing costs. If debt-service cost s have not increased and have in some instances\nbeen significantly decreased by early repayment, th e effect on overall costs will be at worst neutral\nand at best an improvement. Certainly there has been no fundamental reduction in throughput\nvolumes that would in any way have increased the cost per unit output, if anything, the reverse would\nbe the case.\n\n Reference is also made to Korea’s response to Panel Question 125(b) in the present document\nwhere it is explained that debt-service costs tend to be very specific to a particular yard’s situation\nand, hence, not amenable to general trend indicators. This fact is evidenced by the situation at the\nformer East German yards of Kvaerner Warnow Werft, Aker MTW and Volkwerft Stralsund where\nthe state-funded investment was written-off and th e new owners inherited the newly constructed\nfacilities at a fraction of their cost and hence debt- service cost.. In any event, Korea considers that it\nhas given full evidence of the fact that cost econo mies achieved by the thr ee allegedly subsidized\nyards have been significantly greater than price decre ases and that, as a result, there is no substance to\nthe EC’s allegation that increased costs should have led to increased prices.\n\n3.2 With regard to FMI’s assertions on the factor s that have an influence on prices in the first\nparagraph of Section 3 of the FMI report in Exhibi t EC – 146, Korea refers to its response to Panel\nQuestions 124 and 125 in the present document in which it also addresses the allegations on capacity\nin the second paragraph of this Section of the FM I report. In particular, Korea reiterates that the\n\nmeasurement of capacity in CGT and based on a snaps hot for May 2004 yields an arbitrary result that\ndoes not reflect the true market position of the thr ee allegedly subsidized yards. First, as the EC\nalleges that price depression or suppression was ca used to container ships, product and chemical\ntankers and LNGs through the allege d subsidies, the market position of the allegedly subsidized yards\nmust at the very least be specified in these th ree vessel categories and not include other vessel\ncategories as well (refer to the two last sentences of paragraph 2 of Section 3 of the FMI report).\nSecond, no assessment on price depression or suppr ession and the vector that can lead to price\ndepression or suppression can be made without strict assessment of the like products involved and\nassessment for each of the like products separately. Korea has demonstrated in its earlier submissions\nand in the present document that there is no glob al like product for cont ainerships, product and\nchemical tankers and LNGs and that significan t differences exist within these broad categories\nincluding as regards the use of vessels. Hence, the market position of each of the allegedly\nrestructured yards must be determined for each like product vessel separately. Finally, for the reasons\nset forth by Korea in its responses to Panel Questi ons 173 and 174 in the present document, the use of\nCGT and orderbook yields no accurate reflection of th e true market position of any shipyard at any\ngiven point in time.\n\n3.3 As regards the lumping together of various Ko rean shipyards whether allegedly subsidized or\nnot, Korea has reiterated the reasons this is inco rrect in its response to Panel Question 127 in this\nregard. Not only is such lumping of all or several of the Korean shipyards not supported in law but, in\naddition, it is pointless in practical terms as the Korean shipyards that are not alleged to be subsidized\nare in exactly the same competitive position as non-Korean shipyards.\n\n3.4 FMI persists in expressing the view that pri ce depression or suppression must be assessed for\nso-called coherent sections of the industry en bloc in the fourth paragraph of Section 3 and refers to\nthe 1999 report of Drewry Shipping Consultants. In this regard, in the first instance the tenets of price\ndepression and suppression for this case are driv en by the specific legal aspects of the SCM\nAgreement, which is not something which is, or ever would be, addressed in a general industry\npublication. In fact, in some places EC and FMI app ear to be suggesting that price effects tend to be\nuniversal on an industry-wide basis (i.e. all shipbui lding sectors), and in this they are straying into\nareas that are outside the scope of this case, in others they seem to say that they are consistent against\n‘coherent sections’ (a concept which they do not explain). In any case th is is simply not correct – in\nfact, in the Appendices to Drewry’s 1999 report (tha t was selectively invoked by the EC) a table is\nincluded which shows the different price trends of different ships types, sizes and specifications.\nInspection of this data clearly demonstrates that prices have not moved in the same manner across all\nsectors and size segments (this Appendix is included in Exhibit Korea – 131 of the responses to Panel\nquestions). Furthermore in the basic shipbu ilding demand assessments (Forecast newbuilding\ndeliveries) also contained in the Appendices to these reports, the demand is clearly indicated on a ship\ntype and size band basis, with no concept of a crude ‘en bloc’ approach.\n\n3.4 Significant evidence that there is no genera l supply substitutability as claimed by FMI has\nbeen provided by Korea including in Exhibit Korea – 108 and in the responses to the Panel Questions\n126 and in the comments to Question 159. Since many years including the period well preceding the\nbestowal of the alleged subsidies, the EC yards have specialized in specific vessel categories and sizes\nthereof. Their own statements in their financial st atements and the specialized press indicate that this\nwas a conscious and rather permanent move.\n\n3.5 General price indices (which, in fact, refl ect market anticipations and not actual price\ndevelopments) for the shipbuilding industry as a w hole or broad vessel categories are not suited to\naddress the specific legal question of Article 6.3(c), i.e. whether the subsidies had price depression or\nsuppression for their effect for the like product vessels. In particular, Figure 1 presented in Exhibit EC\n– 146 is not suitable for the assessment under Article 6.3(c) as it reflects a relatively short period and\na distant fraction of the period after the bestowal of the alleged subsidies. In addition, Korea has noted\nthat FMI itself admits that “there are clearly di fferences in elasticity depending on specific conditions\n\nin the market sector concerned”. Korea reiterate s that it is precisely these differences that are\nimportant and must be grasped in order to dete rmine whether it is the subsidies that had price\ndepression or suppression for their effect. A general tre nd as such is not a standard for the assessment\nunder Article 6.3(c).\n\n4. Comments with regard to Exhibit EC – 147\n\n The situation involved in the present dispute settle ment procedure is subject to a strict legal\nframework that is totally outside the purview of an y general industry publications as is the case of the\n1999 Drewry report referred to in this Exhibit. Howe ver, much more importantly, the excerpt selected\nby the EC is extremely selective and does not provide an accurate portrayal of a report that is over 220\npages. In particular, the EC omits to make referen ce to the following issues th at are also addressed in\nthe report:\n\n - No reference is made to the significant c overage (4 pages) of EC subsidies and other\ndirect interventions in the shipbuilding market that is also present in the report;\n\n - No reference is made to the statements made in the report regarding the Chinese and\nJapanese influences on capacity growth including “… the Japanese responded by\nremoving production constraints which toge ther with improvements in productivity\nboosted their capacity by as much as 20 per cent … the Chinese have also more than\ndoubled their capacity during the 1990s”;\n\n - The use of CGT as a measure is clearly explained in relation to its relevance to\nvolume of work content involved in newbuilding, not interpretation of price\ninfluences and influencers;\n\n - The report clearly differentiates chemical from products tankers, and clearly analyses\nship types within size bands which is consis tent with Drewry’s approach in Exhibit\nKorea – 70. The EC is, therefore, incorrect to state that it refers to three main sectors\nof tankers, container ships and bulk carriers, and that no subdivision of this is made;\n\n - No mention is made of the fact that Drewry produces other regular specialist shipping\npublications that analyze chemical, LNG, dry bulk and products tankers with\nsubstantial detail of size, sub-categori es, ownership, trading patterns, etc.\nAdditionally, no reference is made to the later Shipbuilding Report published by\nDrewry in Nov 2000.\n\n - The headline item on newbuilding prices st ates “currency devaluation, failing steel\nprices and advances in technology are the main reasons why newbuilding prices fell\nby as much as 20 per cent in 1998”;\n\n - The report does not offer any comments on the presence or otherwise of price\ndepression, suppression, lost sales or serious prejudice, and it is not clear why\nselective references are being made to support the EC’s case on this;\n\n - Drewry does not routinely publish a general newbuilding price index recognizing the\ndanger of using such figures in isolation or without caution;\n\n - No reference is made to the clear stat ement that it was Japan that was clearly the\nleading shipbuilding nation – and it is, ther efore, difficult to see how it is Korean\nyards that could be considered price dominant;\n\n - If the report states that Korean shipyard s globally are competitive, that is not an\nindication of any price depression or suppression by the allegedly restructured yards\ncaused by the alleged subsidies.\n\n The EC and FMI’s reference to this excerpt has been used to imply that excess capacity has\nbeen solely caused by Korean yard s, when very clearly the report ma kes reference to capacity growth\n(as a result of performance, new facilities and de-l imitation) in many areas, specifically Japan and\nChina as well as Korea.\n\nANNEX G-5\n\nRESPONSES OF KOREA TO SUPPLEMENTAL QUESTIONS FROM\nTHE PANEL AND COMMENTS ON THE SUPPLEMENTAL\nQUESTIONS TO THE EUROPEAN COMMUNITIES\n\n(9 July 2004)\n\nI. TO KOREA\n\nA. APRG/PSL\n\n177. Korea argues that country risk accounts fo r the difference in premia charged on APRGs\nby foreign banks as compared to Korean banks . What specific examples of foreign issued\nAPRGs are there in which not only the existence but the amount of country risk premium can\nbe shown, and what specific examples of Korean- issued APRGs are there in which the absence\nof country risk premium can be shown?\n\nResponse\n\n As described in Exhibits Korea – 86a and 86 b, when setting the APRG premia foreign APRG\nissuers separately consider the country risk of Korea on top of the general risks (financial and\nperformance risks) of the shipyards. However, give n that the foreign APRG issuers treat the amount\nof country risk premium as strict business confidential information, information on specific amount of\ncountry risk actually applied by foreign banks is not readily accessible to the Government of Korea.\nNonetheless, Korea hereby submits Exhibit Korea – 140\n which indicates that [BCI: Omitted from\npublic version].\n\n As for the Korean-issued APRGs, Korea refe rs the Panel to Korea’s response to Panel\nQuestion 58 wherein Korea provided three exam ples which are clearly showing the absence of\ncountry risk premium. Korea reiterates below these examples for the convenience of the Panel.\n\n [BCI: Omitted from public version.]\n\n178. Concerning the examples submitted by Ko rea in Exhibit KOR-83 of instances where the\nbuyer imposed requirements concerning the issuer of the APRG in question, it appears that the\nbuyers were seeking guarantors with strong credit ratings/financial soundness. What is the\nrelevance of these examples to the question of whether or not KEXIM was charging market\nrates on its APRGs?\n\nResponse\n\n Korea submitted that information to demons trate the material distinctions between the\npositions of the foreign APRG issuers and Korean issuers of APRGs. The foreign issuers were used in\nthe limited period of the Asian financial crisis (s ee Exhibits Korea 86a and 86b) due to the specific\nrequest by certain foreign (EC) buyers. Because the requirements of the customers were different and\nthe situations of the issuers were different, these isol ated and statistically irrelevant instances were not\nrepresentative of the general conditions pertaining within the Korean market. Among other things, due\nto the strong credit rating of the foreign issuers, th ey were considered bette r guarantors and therefore\n\ncould charge higher premia. They also had to refl ect the country risk premium which was relatively\nhigh during the financial crisis. Moreover, as Ko rea submitted in paras 207 through 216 of its First\nWritten Submission, in order for certain rates to be eligible for any market benchmarks, not only such\nrates must have comparable terms and conditions including comparable collateral, but also such rates\nhave to constitute a statistically representative number of transactions. Because APRGs extended by\ncertain financial institutions are rare and exceptiona l due to empirical differences, the rates of such\nAPRGs cannot constitute a comparable and objec tive benchmark. Please also refer to Korea\nResponse 47 to Panel Questions for further details.\n\n179. The “County Risk Management” Comptroll er’s handbook of the US Comptroller of the\nCurrency, attached as Exhibit KOR-84 states at p age 3 that “a domestic borrower’s credit risk\nmight increase because of significant export receivables from a foreign country...”. Does this\npassage not suggest that a Korean bank issuing an APRG to a Korean shipyard would bear a\ncertain country risk because the transaction was an export transaction, i.e. involved “export\nreceivables from a foreign country”?\n\nResponse\n\n Nowhere does the handbook imply that the country risk can be applied to “every” domestic\ncounterparty that is involved in “an export transac tion”. Rather, the handbook itself establishes that\nthe country risk may be exceptionally applied to transactions with domestic counter parties under very\nlimited circumstances, e.g., where the business of a domestic borrower is heavily relying on the\nbusinesses associated with that particular foreign c ountry with respect to which the country risk is\nassessed.\n\n The handbook confirms that the application of c ountry risk to domestic transactions is not a\ngeneral practice. Along the line, it states that the country risk fact or may be applied to domestic\ncounterparties “where appropriate when assessing the creditworthiness of domestic counterparties”,\nand states that “country risk would be pertinent to exposures to US-domiciled counterparties if the\ncreditworthiness of the borrower\n or of a guarantor …is significantly affected by events in a foreign\ncountry.” (see the third full paragraph on page 2 of the handbook et. seq.; emphasis added).\n\n This explanation is unde rstandable because, in the situations where the business of a borrower\n(or guarantor) is heavily relying on transactions associated with a specific foreign country, events in\nsuch a foreign country will directly and significantly affect the general credit risks of the borrower (or\nguarantor) which in turn will significantly and dir ectly affect the creditworthiness of the borrower (or\nguarantor). Only in such specific circumstances, would it make sense to take into account the country\nrisk of such specific foreign country when assessing the creditwor thiness of such borrower (or\nguarantor).\n\n By contrast, no Korean shipyards deal exclusively with a specific foreign country such that\nthe events in such foreign country would significan tly and directly affect the creditworthiness of the\nKorean shipyards. Further, it should be noted that among the buyers of Korean ships, the absolute\nmajority of buyers are coming from the so-calle d “High Income OECD countries”, e.g., the EU,\nNorway, US and Japan as defined by the World Ba nk. No foreign financia l institution would apply\ncountry risk with respect to counterparties from su ch countries as they do not bear any country risks.\nFor reference, under the Arrangement on Officially Supported Export Credit, the High Income OECD\ncountries are classified as “category 0” countries, to which no country risk is assigned ( see Article 24\nb) and c) of the OECD Arrangement).\n\n Moreover, even if a Korean shipyard were expo sed to the country risk of a particular foreign\ncountry by retaining significant “export receivables ” from the buyers in that foreign country, the\ncountry risk it bears is the country risk of that particular “foreign” country, and not the country risk of\n\n“Korea”. In other words, in such case, any Korean banks issuing APRGs to such Korean shipyard\nwould apply the country risk of the said “foreign” country, not the “Korean” country risk.\n\n In light of the above, a Korean bank issuing an APRG to a Korean shipyard would not bear a\ncountry risk merely on the ground that a transac tion was an export transaction (i.e. involved “export\nreceivables from a foreign country”). Korean yards do not bear a country risk because their export\nreceivables are not from a foreign country that ca rries any noticeable country risk, but from High\nIncome OECD countries. Even if they were exposed to the risk of a particular foreign country, the\ncountry risk that the Korean banks issuing APRGs to Korean shipyards must consider is that of a\nparticular “foreign” country, not the country ri sk of “Korea” which is at issue in the present\nproceeding.\n\n180. Further on country risk, was it not the case that during the period of the financial crisis\nin particular, the Korean domestic banks were faci ng similar “Korea risks” to those that would\nhave been faced by foreign banks (for example, ri sk of expropriation of assets, risk of currency\nmanipulations, etc.)? Please explain in detail.\n\nResponse\n\n Country risk by definition is the risk that economic, social, and political conditions and events\nin a foreign country will adversely affect an institution’s financial interests ( see also the response to\nPanel Question 179). In other words, it is the risk that a country will not be able to honour its external\nfinancial commitments due to the occurrence of cert ain conditions or events. Therefore, in assessing a\ncountry risk, the likelihood of whether a country will service its external debts is to be measured and\nanalyzed. As such, the country risk is the factor to be examined, reviewed and considered by a party\noutside the country concerned. As a result of a forei gn party’s (e.g., foreign APRG issuer) efforts to\nhedge such country risk, such foreign party tends to charge higher premium rates.\n\n On the other hand, Korean domestic banks, by definition, cannot face the risk of their own\ncountry. Risks from events in their own country are no longer “country risk.”\n\n Korea does not agree that the Korean domestic banks were facing similar “Korean risks” to\nthose that would have been faced by foreign banks . Korea would like to emphasize that, when “Korea\nrisks” was mentioned in the context of country risk , it meant the risk to Korea’s ability to honour its\n“external” financial commitments. In this regard , Korean domestic banks cannot face similar “Korea\nrisks” to those faced by foreign banks. Moreover, in light of the definition of country risk, the country\nrisk factors (risk of expropriation of assets, risk of currency manipulations, etc.) must be understood\nto mean those that are of such nature that rather di rectly affect external financial obligations of Korea.\nTherefore, these risks, by nature, could not be th e same as those risks faced by Korean domestic\nbanks.\n\n In any event, it may be true that during the period of the financial crisis, the Korean banks\nwere facing credit risks which were generally increas ed throughout the country, even though they are\nof different nature from the “country risk factors” as faced by foreign banks. Such an increased risk\nduring the crisis was, however, taken into account by the Korean banks as the “general credit risk” of\nthe Korean shipyards. Of course, foreign banks, too, considered the same “general credit risk” with\nrespect to the Korean yards, separately and in addition to the country risk of Korea.\n\n181. Would not similar considerations as to risk of expropriation, risk of currency\nmanipulation, etc. be taken into account by any bank involved in financing foreign trade\n(wherever that bank happens to be domiciled)? Please explain in detail.\n\nResponse\n\n Korea’s response to Question 180 also applies here.\n\n Having said that, Korea takes the term “financi ng foreign trade” in a broad sense to mean any\nfinancing related to foreign trade. As noted in Responses 179 through 180 above, every export\ntransaction does not trigger a bank’s consideration of country risks. As Korea noted in Response 179\nin detail, it depends on the types of such financing transactions and in what context the country risk of\na borrower is examined.\n\n In addition, as far as country risk is concerne d, whether the bank is located inside the country\nor outside the country is the determining factor. Please refer to Reponses 179 and 180 above for more\ndetails.\n\n182. At paragraph 81 of its oral statement, Korea argues that it is not only the type but also\nthe amount of coverage by collateral that is important in comparing different APRGs. In this\nconnection, Korea argues that the collateral ci ted by the EC at paragraph 100 of its second\nsubmission covered only a small portion of the guarantee. Korea then cites Exhibit Korea – 88,\na transaction which according to Korea involved no collateral. How does this demonstrate that\nthe collateral referred to by the EC covered only a small portion of the guarantee?\n\nResponse\n\n Korea submitted Exhibit Korea – 88 to confir m and clarify its response to Panel Question 71\n(as well as Korea’s response to EC Question 14) in wh ich it explained that in the specific instance of\nthe APRG transaction between Shinhan Bank and Han jin no collaterals were involved. As the EC\nsubsequently challenged such statements by Korea ( see para. 106 of the EC’s Second Written\nSubmission), Korea submitted the Exhibit for confirmation and clarification purposes.\n\n Korea refers the Panel to Korea’s response to EC Question 14 in relation to the provision of\nno collateral or a small collateral c overage that directly affects th e determination of APRG premium\nrates.\n\nB. ALLEGED ACTIONABLE SUBSIDIES\n\n183. Please comment on Exhibit EC - 145, containing PwC’s reactions to the Arthur\nAndersen/Anjin submission in Exhibit KOR-79.\n\nResponse\n\n Despite numerous points raised by PwC in Exhibit EC – 145, it failed to establish that it was\nbetter for the creditors to liquidate, rather than r estructure, DHI. As explained in detail by Anjin in\nExhibit Korea – 141\n, the creditors’ recoverable amount under any going concern scenario was\nalways higher than the recoverable amount in th e liquidation scenario. This was so even when\ncorrection is made for the double-counting of tax shield effect.\n\n For details, please refer to Anjin’s response ( Exhibit Korea – 141\n) to PwC’s comments.\n\n184. In particular, please comment on the statement at page 3 that “the Enterprise Value of\nthe restructured company is lower than the Ente rprise Value of the company computed without\ndebt restructuring”.\n\nResponse\n\n It is true that, according to Anjin’s calcula tions in the 1999 Report, the Enterprise Value of\nthe restructured company was lower than the Enterprise Value of the same company without\nrestructuring. This was a formalistic result from the technical model used by Anjin arising from a\ncarry-over of a residual amount of shareholder value in the debt/equity swap. However, the creditors\ndecided that the proposed workout plan of spinni ng off the two companies that had no synergistic\nvalue and undertaking debt/equity swaps and debt restructuring was preferable from the perspective of\nultimate collectibility on the debt. Moreover, as Anjin points out and PwC does not contradict, in no\nevent was the Enterprise Value of the restructured company lower than the liquidation value of the\nsame company. Therefore, this fact does not affe ct the creditor financial institutions’ decision to\nrestructure DHI, rather than liquidate it.\n\n For details, please refer to Anjin’s response ( Exhibit Korea – 141\n) to PwC’s comments.\n\nC. SERIOUS PREJUDICE\n\n185. Concerning Exhibit KOR-115:\n\n (a) No information is provided as to th e source for the prices presented in this\ndocument. Please identify in detail the source(s).\n\n (b) No dates are associated with any of the prices shown in the documents. Please\nprovide this information.\n\n (c) No information is provided as to what the prices shown in the document\nrepresent (i.e., contract prices, bids, etc.). For each price shown, please indicate\nprecisely what it represents.\n\n (d) No information is provided in respect of LNGs. Please provide the same sort of\ninformation on LNGs for the same peri od(s) and on the same basis as the\ninformation in the table.\n\nResponse\n\n (a) The source of the information is the document entitled “Background report – Detailed\nevaluation of key price movements” prepared by the EC’s consultant, FMI, in\nAugust 2003\n1 that was submitted as Annex 5a-2) by the EC itself in the Annex V\nprocess and is submitted herewith fo r the convenience of the Panel in Exhibit Korea\n- 142.\n\n (b) The prices shown are the average prices for the period from 1997 to 2003, i.e., the\nprices shown in the following tables in the FMI report supplied as Annex 5a-2) by the\nEC in the Annex V process and now attached as Exhibit Korea – 142:\n\n1 Refer to paragraph 293 of Korea’s Oral Statement delivered at the Second Substantive Meeting which\nidentifies the source of the data shown in the table in Exhibit Korea – 115.\n\n - for handysize tankers: Table 2.1 at page 2 of the report;\n - for handymax product tankers: Table 2.2 at page 4 of the report;\n - for panamax product tankers: Table 2.3 at page 6 of the report;\n - for chemical tankers: Table 2.4 at page 8 of the report;\n - for feeder container vessels: Table 3.1 at page 12 of the report;\n - for panamax container vessels: Table 3.2 at page 15 of the report;\n - for post panamax container vessels: Table 3.3 at page 16 of the report.\n\n (c) According to Section 1.1 of the FMI report in Exhibit Korea – 142, the prices are the\naverage price per CGT calculated for the period from 1997 to 2003. FMI identifies\nthe source of the data as being BRL Shipping Consultants. Korea assumes but the EC\nand its consultant would be be tter qualified to confirm that this data reflects the order\nprices shown in the FMI reports which th e EC itself submitted as Annex 10 in the\nAnnex V process. The important factor is that these are average prices set forth by the\nEC’s consultant, FMI, and the EC themselves.\n\n (d) Korea is unable to provide the same info rmation for LNGs as the data source which is\nthe FMI report submitted by the EC in the Annex V process does not contain this data\nfor LNGs.\n\n186. Concerning Exhibit KOR- 109, Korea presen ts certain breakouts of different sizes of\ncontainer ships and tankers. For LNGs, while the text in Korea - 109 refers to various sizes of\nLNGs, no statistics are presented broken out by size. Please explain.\n\nResponse\n\n As at February 2004 and since 1996 virtually a ll LNG vessels that have been ordered have\nbeen for vessels of 135,000 cu metres or larger, re flecting the recent growth in LNG ship sizes as\nLNG trade volumes have increased. In fact, of near ly 100 orders placed from 1996 only three have\nbeen for smaller vessels, one for a small coastal ve ssel of <10,000 cu metres capacity built in EC,\nanother of 74,000 cu metres capacity built in EC and a third of 23,000 cu metres capacity built in\nJapan. The other vessels all fall within the 135 – 145 ,000 cu metres capacity range except for one\nsingle vessel of 153,000 cu metres on order in France. Orders for the next generation of larger LNG\nvessels in the 180 – 250,000 cu metres capacity range have yet to be confirmed.\n\n Given this concentration of vessel size over th e timescale covered by this complaint and the\nfact that Korea has only built vessels of 120,000 cu me tres or larger, no breakdown of LNG orders by\nsize was felt to be appropriate or necessary to re flect the current size band in which LNG vessels are\nprimarily built.\n\nII. TO THE EC\n\nA. APRG/PSL\n\n187. Please comment on Korea’s recalculations of benefit in Exhibits Korea - 91-102.\n\nB. ALLEGED ACTIONABLE SUBSIDIES\n\n188. Concerning the question of whether the rest ructuring of Daewoo was subsidized, please\nprovide a summary, based on all of the submission s of Arthur Andersen/Anjin and PwC, of the\nEC’s analysis and conclusions in respect of whether DHl should have been liquidated instead of\nrestructure. In this summary, all relevant figures should be shown in tabular from, with cites\n\nand cross-references to the original Arthur Andersen report of November 1999 assessing the\nvalue of bill under various scenarios.\n\n189. Concerning the Daewoo restructuring\n\n (a) Concerning the most recent PwC submission (Exhibit EC - 145), please explain\nin detail the statement at page 3 that the Anjin analysis indicated “that the\nEnterprise Value of the restructured company is lower than the Enterprise\nValue of the company computed without debt restructuring”.\n\n (b) What is “enterprise value” and how does it differ from “going concern value”?\n\n (c) What is the significance of the fact that the “enterprise value” was lower under\none set of calculations than under another? How if at all does it affect the central\nissue raised by the EC, namely the deci sion to restructure instead of liquidate\nDaewoo?\n\n (d) What is the significance of Anjin’s reply in Exhibit KOR-7O that enterprise\nvalue was reduced under the analysis of the restructuring scenario from what it\nhad been under the valuation of tile non-restructured company? What if\nanything is the significance that enterprise value calculations differed under two\nscenarios for the central issue posed by th e BC, namely whether it was better to\nliquidate\n or to restructure Daewoo?\n\n190. The data presented in Exhibit KOR-108 show interested depreciation expense in the in\nthe cost/profitability analysis for Daewoo. Please comment. How can this be reconciled with the\nEC’s assertion that these costs have not been adequately reflected in Daewoo’s prices?\n\n191. Exhibit KOR-107 sets forth the results of th e court-ordered/supervised restructuring of\nDaedong. Presumably, such a restructuring had to proceed in accordance with Korean\nbankruptcy law. On what basis does the EC allege that nevertheless it involved a subsidy?\n\nC. SERIOUS PREJUDICE\n\n192. One conclusion that might be drawn from Exhibits KOR-91-102 is that Korea accepts\nthat there is a benefit from the KEXIM financing at issue, but that the benefit in a number of\ncases is quite small (0.5 per cent or less). If on e accepts that the benefit is of the magnitude\nreflected in these Korean exhibits, what woul d be the implications for the EC’s serious\nprejudice analysis and conclusions?\n\nComment by Korea on this question addressed to the EC\n\n Without prejudice to the fact that Korea does not accept in its Exhibits Korea – 91 to 102 that\nthe KEXIM facilities conferred a benefit,\n2 Korea considers that the KEXIM facilities cannot have had\nprice depression or suppression for their effect in the first place because the EC itself admits that\nKEXIM’s base rate for APRGs has increased while its credit risk spreads became more conservative.\nHence, if anything the KEXIM facilities should have exercised less pressure on the prices for vessels.\nIn addition, the EC itself shows fluctuating price trends (i.e., decreases and increases) in Attachment 2\nto its responses to the Panel questions (especially in Figure 2.3). As it does not show a decrease in the\nbenefits allegedly afforded by KEXIM in periods of increasing price trends, there is all the less\nevidence of a price depressive or suppressive effect of the KEXIM financing facilities. In the second\nplace, the magnitude of the price depression/supp ression alleged in Attachment 2 to the EC’s\n\n2 See, for example, Korea’s response to Panel Question 114.\n\nresponses to the initial Panel questions is blatantly out of proportion with the magnitude of the alleged\nbenefit.\n\n Notwithstanding the EC’s allegations of qua litative effects of the KEXIM facilities (which\nKorea disputes), Article 6.3(c) of the SCM Agreement explicitly requires that the alleged subsidies\nmust have “significant” price depression or suppr ession for their effect. Hence, the letter of this\nprovision requires a quantification of the effects of the subsidies and a benefit of 0.5 per cent does not\nmeet this threshold while the blatant difference in the proportion of the alleged benefit and the alleged\nprice depression/suppression clearly demonstrates that there is no causal link between the alleged\nKEXIM benefits and the price depression/suppression asserted.\n\n Once again, in response to this new EC “eviden ce” Korea must recall that, even if one were to\naccept the EC’s approach, the EC still has not explained how such de minimis subsidies contribute to\ndeveloping or improperly maintaining excess capacity leading to price suppression. As Korea has\nnoted in the past, the EC seems to be trying to a void this very direct and clear requirement of the\ntreaty language to demonstrate that the significant price suppression is the effect of the subsidy by\ntrying to attach any alleged subsidy it can to a product and then sweep that product as a whole into the\nprice suppression analysis. Furthermore, the EC does not really attempt to do this in relation to the\nproducts. The EC even ignored evidence that many ships produced by unrestructured shipyards did\nnot “benefit” from APRGs or pre-shipment loans, but nonetheless attempted to sweep every ship into\nits analysis.\n\n The EC at the latter stages attempted to move a little away from this totally capacity\ndependant approach and reintroduce price unde rcutting as a supporting element of its price\nsuppression/depression analysis. Aside from the lega l block on this reintroduction of an abandoned\nargument, the EC leaves unexplained how such de minimis subsidies could have resulted in the\nalleged price suppression or depression when, by the EC’s own admission, the Korean yards enjoyed\na considerably larger cost advantage. There would simply be no competitive effect from such subsidy.\n\n Finally, if these de minimis subsidies were to have such an e ffect, then the causal effect of the\nmuch higher level of EC subsidies (which the EC does not and cannot contest) on the marketplace\nwould overwhelm and displace any effect of the alleged Korea subsidies. In such a case, it would be\nimpermissible to attribute to the Korean subsidies effects that were actually caused by the much larger\nEC subsidies.\n\n193. Exhibit KOR-112, concerning MOCIE’s interv ention at the request of Samsung, could\nbe viewed as indicating that the government takes action if prices are too low. If this is the case,\nwhat are the implications for the EC’s serious prejudice claim?\n\nComment by Korea on this question addressed to the EC\n\n In its response of 2 July 2004 to the EC’s Qu estion 5 addressed to Korea, Korea explained in\ndetail the background of MOCIE’s intervention in the Hamburg Sud-DSME transaction. As\ndemonstrated there, MOCIE was not concerned with the price level as such, but with the anti-\ncompetitive behaviour of the parties involved in that transaction. In any event, this MOCIE\nintervention does not support the EC’s serious pr ejudice claim. Instead, it indicates that it was a\nEuropean shipyard, Odense, that was offering the lowest prices and thus depressing prices ( see\nExhibit EC - 88).\n\n194. If the Panel were to accept the product subdivisions set forth in Exhibit KOR-109, how\nwould this affect the EC’s analysis of price suppression/depression? Please respond in detail.\n\n195. Please comment on Exhibit KOR-115.\n\nCOMMENTS BY KOREA ON THE NEW FACTUAL INFORMATION SUBMITTED BY THE EC\nAND THE US ON 2 JULY 2004\n\n134. In Exhibit EC - 118, PwC asserts that “ [t]he KSDA Bond Matrix is the accepted mark-\nto-market price for the domestic market”. Does this mean that the EC disagrees with Korea’s\nargument that the bond matrix represents hypothet ical / projected rates, or does the EC accept\nKorea’s argument but consider that the inde x nevertheless constitutes a reliable market\nbenchmark? Please explain. What does “mark~to~m arket” in this context mean? In particular,\nwho was marking what to which market?\n\nComment on the EC’s new factual information; Exhibit EC – 148 regarding KSDA Bond Matrix\n\n In Exhibit EC – 148, PwC argues that the KSDA Bond Matrix is the mark-to-market price for\nthe domestic market and that “mark-to-market” means that “KSDA employees update every day the\nprice and yields of the bond used in all the indices”. While the explanation by PwC regarding the term\n“mark-to-market” is not clear enough to fully resolve its ambiguity (please recall that the Panel\nspecifically asked who was marking what to which market ), PwC nonetheless seems to focus on daily\ncollection activity of data.\n\n However, such daily collection activity do es not automatically mean that the Matrix\naccurately reflects the “price” of a bond or even bonds issued in a particular sector of industry. In fact,\nPwC itself admits the limitation of the Matrix by sta ting that it is the “representation of the yield … at\na specific moment in time”. This statement is nothi ng but saying that the Matrix is only a general\nindex, which Korea already explained in its r esponse to Panel Question 73. Representation is a\nrepresentation (whatever it may mean). It cannot be the price (i.e., yield in the instant context) of a\nspecific bond.\n\n For the better understanding of the Panel, Ko rea submits below some cases showing actual\nyields of specific bonds compared to the co rresponding KSDA Bond Matrix (both of which are\navailable at the KSDA website).\n\nCase 1\n\nIssuing Company: Hyundai Heavy Industry\nBond Classification: HHI 100 KSDA Standard Code: KR6009544M29\nIssue Date: 21 February 2001 Expiry date: 21 February 2004\nCredit Rating upon Issuance: A0\n\n(Unit: %)\nKSDA Bond\nMatrix\nRated A0\nKSDA Bond\nMatrix\nRated A0\nKSDA Bond\nMatrix\nRated A0 Date\nHHI 100\nWeighted\nAverage Yield\n3M 6M 9M\n2003-11-26 4.38 4.8\n2003-11-24 4.38 4.8\n2003-09-02 4.32 4.89\n2003-05-26 5.9 5.08\n2003-05-23 5.87 5.06\n\nCase 2\n\nIssuing Company: Hyundai Heavy Industry\nBond Classification: HHI 102 KSDA Standard Code: KR6009544M78\nIssue Date: 23 July 2001 Expiry Date: 23 July 2004\nCredit Rating: A0\n\n(Unit: %)\nKSDA Bond\nMatrix\nRated A0\nKSDA Bond\nMatrix\nRated A0\nKSDA Bond\nMatrix\nRated A0 Date\nHHI 102\nWeighted\nAverage Yield 3M 6M 9M\n2003-12-17 4.8 5.24\n2003-11-24 4.99 5.11\n\nCase 3\n\nIssuing Company: Samsung Heavy Industry\nBond Classification: SHI 84 KSDA Standard Code: KR6010144M21\nIssue Date: 24 February 2001 Expiry Date: 24 February 2004\nCredit Rating: A0\n\n(Unit: %)\nKSDA Bond\nMatrix\nRated A0\nKSDA Bond\nMatrix\nRated A0\nKSDA Bond\nMatrix\nRated A0 Date\nWeighted\nAverage\nYield Rate 3M 6M 9M\n2003-12-11 4.52 4.93\n2003-11-11 4.32 4.88\n2003-07-25 4.72 5.13\n2003-05-28 5.15 5.05\n2003-05-20 5.13 5.02\nNote: The months (3M, 6M, 9M) represent the remaining months to the expiry date.\n\n The above tables show that the KSDA Bond Ma trix does not represent actual yields of the\nbonds issued. For example, when looking at yields rates of HHI 100 (the remaining period of which to\nthe expiry is approximately 3 months) on 26 N ovember 2003 and the KSDA Bond Matrix 3M on that\ndate, several questions arise inevitably: (i) What is the market price of a bond with credit rating A?\nHHI 100 bond yield? or the KSDA Bond Matrix?; (ii) Is HHI 100 bond yield below market price if\nthe KSDA Bond Matrix is the “market price”?; ( iii) Does this mean that HHI 100 bond yield was\nabove the market price back in May 2003? (i v) (Assuming so,) then why do investors make\ninvestment into HHI 100 bond on 26 November 2003?; (v) (Further assuming that an investor\npurchases bonds of a company in the same industry sector as HHI), which one should be the\nreference, HHI bond yield or the KDB Bond Matrix?; (vi) Why the prices of HHI 100 bond and HHI\n102 bond are different as at the time both bonds are having the same months remaining period? (vii)\nWhy the prices of HHI 100 bond and SHI 84 bond (both of which are having 3 months remaining\nperiod as of November 2003) are different?; and the questions may continue on and on..\n\n Should the KSDA Bond Matrix be the market pri ce, it provides no clear answers to the above\nquestions. This means that the KSDA Bond Matrix is only an index which indicates the market\nsituations on a specific date. It does not reflect speci fic situations of the industry sector, the issuers,\nand the preferences in the market. Thus, it can in no event be a “price” at which a specific bond can be\npurchased. At best, it may be a preliminary indicator that an investor may use as a first reference\nbefore studying the market further.\n\n Further, Korea would like to clarify certain points made by the EC which are misleading and\nfactually baseless. The EC submitted that “the corpor ate bonds actually issued by the yards were not\nappropriate benchmarks as regards corporate bonds (i ) because they were guaranteed by a bank, (ii)\nwere not issued in the same currency or (iii) not issued at the same time as KEXIM PSLs” ( see\npara. 21 in the EC response to Panel Questions). These assertions are incorrect. In the first place, in no\ninstance were bank guarantees provided in relation to the corporate bonds issued by the Korean yards.\nThe EC has never provided any evidence to substa ntiate this assertion. Secondly, most bonds were\nissued in Korean Won. The in stances where foreign currency bonds were issued were extremely\nlimited (i.e., [BCI: Omitted from public version] ). As indicated in Exhibit Korea – 139 submitted\nalready, even [BCI: Omitted from public version] issued its bonds in Korean Won in most of the\ncases and no other Korea yards have issued bonds in foreign currency. Lastly, the EC asserts that\nbonds were not issued at the same time with PSLs. While bonds may not have been issued on the\nexact same dates as PSLs, this fact cannot necessar ily dismiss those corporate bonds actually issued\nby the shipyards from the eligible list of benchmar ks. There is no requirement that, in order to be\ncomparable, an instrument being compared must be issued on the same date as another instrument\nconcerned. As stated in Korea’s response to Pa nel Question 170, Korea considers that the average\ninterest rates for financial instruments actually u sed by the shipyards, presented on a quarterly basis,\nwould be proper benchmarks and these quarterly data can avoid possible anomalies when comparing\nthe instruments on day-to-day basis.\n\n136. At para. 95 of its oral statement, Korea pr esents a number of points criticizing the EC\ncalculation methodology, and states that further details are contained in Exhibits Korea 90-102.\nPlease respond to Korea’s criticism in detail, in cluding with reference to the content of these\nexhibits.\n\nComment on the EC’s new factual information\n\nComments on Exhibit EC - 148 regarding incompatibility of credit ratings\n\n On the issue of compatibility of KEXIM credit ratings for PSLs with the bond ratings by\nother rating agencies, PwC contests in Exhibit EC – 148 Korea’s arguments that (i) the levels of\nunderlying credit risks are different and (ii) factors for grading are not alike.\n\n First of all, the content of PwC’s report casts into question whether PwC really has the\nexpertise to opine on the nature and mechanism of determining credit ratings. As discussed below and\ndemonstrated by the report and materials submitted by Korea, PwC’s analysis is full of fallacies and\ndistortions which a banking expert would never make.\n\n In particular, Korea is surprised by the bold statement of PwC that “…a private loan and a\nbond having the same ratings will present the same obligor repayment capacity and the same credit\nexposure risk…Both should therefore be rem unerated with the same interest rate” ( see the last\nparagraph at page 5 of Exhibit EC – 148. Emph asis added). When making this puzzling statement,\nPwC seems to be ignorant of the fact that bank s and rating agencies apply different factors in\ndetermining the ratings for different types of financia l products and, therefore, that different types of\nproducts (e.g., bank loan v. corporate bond, cor porate bond v. commercial paper) carry different\ninterest/yield rates even where the borrower or the issuer of these products is the same company. This\nis a fact well-known to every financial expert in th e world. According to the PwC’s logic, a company\n\n(e.g., Hyundai), which has a stable and uniform ra ting, should borrow loans or issue bonds, CPs, CDs\nor whatever instruments always at the same intere st rate at a given time, assuming that maturity and\ncollateral (or non-collateral) are the same. This is non-sensical, at the very least.\n\n PwC begins its fallacious analysis by challe nging the statement in Exhibit Korea – 91. It\ndisputes the statement that corporate bond rating (i.e., issue rating) in Korea could actually be\nconsidered same as the “issuer” rating whereas KE XIM ratings were the “facility rating” that takes\ninto account all the characteristics of the credit facility. Then, PwC takes the DSME bonds as an\nexample, and states that the ratings of these bonds as secured by collateral, cannot be considered the\nsame as the rating of DSME and that [t]he rating of the bonds reflects the collateral of the bond\nemission just as KEXIM ratings reflect the collateral of the loans granted . PwC first ignores the fact\nthat the corporate bonds issued and traded in Ko rea are mostly non-collateralized bonds and the bond\nrates quoted by KSDA are based on “unsecured long-te rm senior bonds”. Second, after admitting that\nthe rating of DSME bonds reflect collaterals just as KEXIM rating does, PwC then fails to explain\nwhy the DSME bonds cannot be used as benchmark for KEXIM’s PSLs.\n\n Thereafter, based on a study by the society of actuaries, PwC attempts to rebut Korea’s\nargument that there is no correlation between KEXIM rating on its loans (which are equivalent to\nprivately-placed bonds) and the ratings on the publicly traded corporate bonds because default rates\nfor private debt placements are lower than that for public debt placements. However, this study does\nnot contradict the conclusions of Carey (1998) relied upon by Korea. Indeed, PwC quoted the\nfollowing statements which appear, in fact, to contradict the allegation by the EC:\n\n - “Over the sample period studied, private pl acements with most recent internal ratings\nthe equivalent of investment grade and BB have loss experience similar to publics in\nspite of worse incidence or default rates because of better loss severities on private\nplacements”,\n\n - “Relative to publicly issued bonds, priv ate placements with most recent internal\nratings the equivalent of B and riskier offer superior experience\n with respect to all of\nincidence, severity and economic loss” (see the first paragraph on page 5 of Exhibit\nEC – 148. Emphasis added).\n\n Korea cannot figure out what PwC is trying to establish with these statements. The plain\nreading of these statements still leads to the conclu sion, as drawn by Korea, that the privately placed\ndebt instrument (such as KEXIM’s PSLs), by nature , generally involves lower default risks than\npublic placements with a given credit rating. Hence, PwC’s analysis fails to rebut Korea’s argument\n(i) that credit risks for a bank credit rating are lo wer than those for the corresponding corporate bond\nrating and (ii) that for the same corporate entity, the corporate bond rating must be higher than the\ncredit rating for bank facilities in order to have equivalent credit risk.\n\n Interestingly, the statement by the societ y of US actuaries admits that the insurance\ncompanies fairly frequently disagree with NAIC an d with each other on credit rating, although, on\naverage, the disagreements are small. These disagreem ents arise even if the companies engaged in the\nsame insurance business ar e assessing the credit risk involved in the same financial product, i.e.,\ncorporate bonds. This demonstrates how significan t the disagreements would be in cases where\nKEXIM as a bank assesses the credit risk of its bor rower in loan transactions while a credit rating\nagency, such as KIS, assigns ratings to corporate bonds which are totally different products from a\nbank loan. In this regard, the PwC’s assertion that “the correlation between corporate bond ratings and\nKEXIM ratings [on loans] should exist at least for ratings better than or equal to BB [rating by a credit\nrating agency on corporate bonds]” is non-sensical.\n\n In order to redress this flaw, PwC quotes the actuaries society’s statement that “the more\npessimistic one is usually the one with the highest predictive power”( see the second paragraph on\n\npage 5 of Exhibit EC – 148). However, it is obvious that this “usual” order of predictive power\napplies only within the context of the same insu rance companies who are assessing credit risks on the\nsame financial instrument (i.e. corporate bond). In addition, the society of actuaries has never\nconducted a study, and therefore does not dare to express an opinion on whether such “usual” order of\npredictive power would apply to a totally heterogeneous situati on where a bank assigns rating to a\nborrower in loan transactions while a credit rating agency assigns a rating to a corporate bond. In such\na case, a comparison is not possible as the two agencies are using two different measurements,\nconsidering totally different factors.\n\n PwC’s egregious analysis does not stop here. It further attempts to convince the Panel of the\ncorrelation by trying to implement a mechanistic ma tch between the credit rating agency’s “A to C”\nratings and KEXIM’s “P to SM” rating system merely based on definitional similarities. At the outset,\nKorea would like to point out that such a mechan istic matching technique is meaningless as long as\nrating agencies do in practice assign different ratings to even the same borrower/issuer or to the same\nfinancial instrument under different circumstances. Using the same rating definition (expressed in\nlanguage that permits diverse applications in actua l cases) does not guarantee that all different raters\nwould assign the same rating. As mentioned earlier, th e statement by the actuaries society admits that\ndisagreements in rating frequently take place even among companies engaged in the same insurance\nbusiness.\n\n Moreover, Korea cannot understand where PwC’ s conclusion that KEXIM’s P5 rating is\ncomparable to a “BBB” rating comes from. PwC appear s to take P5 instead of P4 simply because P5\nis a lower rating to P4 ( see Table 1 on page 7 of Exhibit EC – 148). However, Figure 2 in the same\npage of the PwC report seems to either conflict with Table 1, or only shows that the credit spread for\nBBB is corresponding to the credit spread for P4, not P5. Furthermore, PwC has failed to provide any\nsupport for its conclusion that KEXIM’s SM rati ng should be equivalent to “C”. PwC has only\nprovided Table 1 which only refers to the chronology of the changes implemented by KEXIM in its\ncredit rating systems of KEXIM, but ends with “BB” as the worst rating in the last column of the first\nrow (see Table 1 on page 7 of Exhibit EC – 148). The natu ral reaction to this would then be to inquire\nwhy it is only “C”, not “single B”that corresponds to KEXIM rating SM?\n\n In any event, as noted before, this whole ma tching exercise is highly mechanistic and cannot\nsupport the EC’s allegation that rating X on co rporate bonds always corresponds to rating Y in\nKEXIM rating system. This means that the EC’s attempt to use corporate bonds as a benchmark for\nKEXIM PSLs is not acceptable. Assuming arguendo that there was a financial contribution, the right\napproach would be to compare the rates of KEXIM PSLs granted to a shipbuilder with the rates of\nother financial products used by the same shipbuilder.\n\n In order to support Korea’s claim that KEXI M credit ratings are not compatible with the\ncorporate bond ratings and to rebut various othe r allegations of the PwC and the EC, Korea\nsupplements Exhibit Korea – 91 with a report by KEXIM as a banking expert, which is submitted\nherewith as Exhibit Korea – 143\n. Korea summarizes below the key information provided by this\nreport.\n\n(1) First of all, the report points out that the elements for assessing credit risks are different from\neach other. More specifically, KEXIM credit rating sy stems look into “probability of defaults”, “loss\ngiven default” and “expected loss”. The report states:\n\nIt is a uniform practice in banking industry to review, examine and analyze following\nthree elements when assigning credit ratings: probability of default (PD), loss given\ndefault (LGD), and expected loss (EL) . ( See the second paragraph of II.A.1. of\nExhibit Korea – 143).\n\nBy contrast, the rating agencies are reviewing only the “probability of defaults”, not “loss given\ndefault” or “expected loss.” This must result in having materially different horizons as to the risks\nassociated. The report further continues:\n\nAccording to Moody’s study on Bank Loan Loss Given Default, it is evident that\nthere exists a significant difference in e xpected loss between bank loan rating and\ncorporate bond rating. In consequence, the risk premiums are different, which\nultimately results in the difference in interest rates.\n<Exhibit 6: “Bank Loan Loss Given Default”, November 2000, Moody’s Investors Service, p.9>\n\nAs shown in the chart above in Exhibit 6 to Bank Loan Loss Given Default by\nMoody’s, “the mean bank loan value in default is 69.5 per cent for senior secured and\n52.1 per cent for senior unsecured,”\n3 whereas the mean value of long-term public debt\nis 59.1 per cent for senior secured and 45.1 per cent for senior unsecured. ( See\npara. II.A.2.of Exhibit Korea - 143.)\n\n(2) Secondly, as Korea submitted, banks adopt a so-called “point-in-time” approach whereas\nrating agencies use the “through-the-cycle” appro ach. This makes the two rating systems quite\ndifferent from each other as the banks seek “most likely cases” while the ag encies are anticipating\n“stress” scenario. This inevitably results in the different properties of both ratings so that, for\nexample, in contrast with bank credit rating system, “agency ratings may not have the same sensitivity\nto change… of bank risk ratings” ( see the last paragraph of II.B.1 of Exhibit Korea – 143).\n\n In view of these distinctive properties includi ng different elements for assessing credit risks\nand dissimilar approaches, bank credit rating syst ems cannot be compatible with agency rating\nsystems. This is supported by Moody’s, which clearly states that:\n\nIn which Moody’s has rated both a company’s credit facilities and its bonds, the bank\nloan rating is one or more refined rati ng categories higher than the bond rating. ( See\nthe first paragraph of III of Exhibit Korea – 143).\nBased on the reasons as detailed above, Korea reite rates that bank credit rating systems cannot be\ncompatible with agency rating systems.\n\nComments on Attachment EC - 10 regarding recalculations of benefit by the EC\n\n In Attachment EC - 10, the EC provided a chart showing that KEXIM PSLs conferred a\nbenefit by way of recalculations showing certain ad justments. While Korea will show the fallacies in\nthese recalculations below, Korea would like to emphasize some additional points.\n\n3 Bank Loan Loss Given Default, November 2000, Moody’s Investors Service, p.1\n\n ¾ Korea cannot agree that the KSDA Bond Matrix provides a benchmark.\n\n As Korea detailed in its comments on the EC ’s response to Panel Question 134 above, the\nKSDA Bond Matrix is mere a preliminary indicator that an investor may use as a first reference\nbefore studying the market further. It cannot be a market price or benchmark.\n\n ¾ Further, Korea cannot agree that KEXIM credit ratings and corporate bond ratings are\ncomparable.\n\n As explained in detail above and in Exhi bit Korea – 143, KEXIM credit rating are not\ncomparable to ratings by credit rating agencies. This is undoubtedly supported by the unequivocal\nstatements by Moody’s. Korea will not reiterate those herein again.\n\n ¾ In most cases, the EC found “negative or minimal” margins only.\n\n As Korea cannot agree on the methodology sugg ested by the EC, Korea denies the existence\nof any benefits. However, even if Korea accep ts the methodology for the discussion purposes only,\nmost cases reflect negative or minimal benefit margin s. This is so even when following the EC’s\nmethodology in its entirety, and it is even more so when following the methodology corrected by\nKorea. Korea herewith submits Exhibits Korea – 145 through 149\n to substantiate this claim.\n\n In relation to this, the EC made another atte mpt to provide a misleading portrayal of hard\nfacts. In para. 58 of its responses to the Panel Qu estions, the EC states that “the difference between\nthe market benchmark and the KEXIM rate is mo re than 30 per cent when expressed as a proportion\nto the KEXIM actual spread rate ” (emphasis added). It is evident why the EC did this. After\nestablishing that even in the EC’s own methodology, only minimal benefit margins are obtained, the\nEC now attempts to exaggerate the magnitude of alleged benefit margins by comparing those with\nKEXIM’s credit risk spread. The credit risk spread, however, is only a fraction of the overall rate.\n\n In addition, as Korea explained during the Se cond Substantive Meeting, the EC can show\nthese “minimal” alleged benefit margins for only a small fraction of the PSLs extended by KEXIM.\nThe tables below are summaries in relation to th ese instances. Given the small number of instances\nwhere the minimal margins would be found and the ma gnitude of such margins, Korea considers that\nthe EC’s claims are unfounded and unsupported and mu st be rejected by the Panel when taking a\ndecision on all facts and evidence before it.\n\nEC Recalculation\n\nAlleged Benefit\nShipyard\nPSL Cases\nwhere\npositive\nbenefit was\nfound\nlower\nthan\n-1%\n-1 ~ -\n0.5%\n-0.5\n~\n0%\n0 ~\n0.25%\n0.25\n~\n0.5%\n0.5 ~\n0.75%\n0.75\n~ 1%\nOver\n1%\nDSME 37/136 5 32\nHHI 22/197 4 29 5 6 6 2 3\nMipo 27/142 1 1 11 3 3 4 6\nSamsung 1/8 1 1\nHanjin 8/45 3 4 1 3 3 1\nSamho 8/45 4 4\nSTX 6/6 6\nTotal 109/579 8 35 18 12 17 10 52\n\nCorrigendum by Korea\n\nMargin\nShipyard\nPSL Cases\nwhere\npositive\nmargin was\nfound\nlower\nthan\n-1%\n-1 - -\n0.5%\n-0.5 –\n0%\n0 -\n0.25\n%\n0.25\n–\n0.5%\n0.5 -\n0.75\n%\n0.75\n– 1%\nOver\n1%\nDSME 0/136 1 12 24\nHHI 17/197 5 33 4 4 9\nMipo 23/142 1 5 12 9 2\nSamsung 1/8 1 1\nHanjin 6/45 3 6 2 3 1\nSamho 0/45 2 6\nSTX 6/6 6\nTotal 53/579 1 23 75 17 15 14 0 7\nNote: The number “579” is the total PS L cases listed in Korea’s Annex V Responses\n Attachment 1.2(30).\n\n ¾ The EC’s approach is inconsistent as rega rds the selection of its alleged benchmarks.\n\n As Korea established with the concurrence of the EC, the PSL is a short term loan facility, the\nduration of which is not exceeding 6 months. This has been an undisputed fact in this proceeding as is\nalso shown by the EC itself when it used benchmarks of a 6 month duration in Exhibit EC – 125.\n\n Notwithstanding this, the EC now abruptly starts to allege that a benchmark with a 1-year\nduration should be used in certain cases. In suppor t, the EC alleges that the base rates for certain\ninstances of PSLs are [BCI: Omitted from public version] . This is non-sensical. As has been\nestablished and thus far alleged by the EC itself, a proper benchmark must be a facility conferred with\nsimilar terms and conditions. The term must be asses sed based on its duration, not the name of base\nrates. Korea would like to ask the EC how and why the EC used the 6 month KSDA Bond Matrix to\nPSLs conferred to STX where the base rates were “fixed” rates.\n\n Korea provides one example to show that wh ile the base rate is WNPRI1Y, the average\nduration of PSL instalments is not exceeding 6 months as below.\n\n [BCI: Omitted from public version.]\n\n ¾ The EC still failed to adjust Samho’s PS L for a 100 per cent physical collateral.\n\n In this connection, the EC has kept profferi ng its traditional “best information available” rule\nby stating that it is not “KEXIM’s policy to keep and maintain any worksheet or similar documents\nnecessary for the consideration of collaterals” ( See para. 49 of its response). This is egregious, and it\nis another example showing the bad faith of the EC.\n\n Korea submitted KEXIM’s list of pre-shipment loans to sh ipbuilders as Korea Annex V\nAttachment 1.2(30)-1 and Exhibit Korea – 60 which clearly show that as to [BCI: Omitted from\npublic version.] Korea hereby submits the relevant pages of KEXIM list of pre-shipment loans to\nshipbuilders as Exhibit Korea – 144\n to substantiate this (the EC purposefully submitted as Exhibit\nEC – 24 only a part of the list). For more details, please refer to the corrigendum on the EC’s\nrecalculation with respect to Samho (Exhibit Korea – 145\n\n ¾ The EC wrongly applied “Adjustment Duration (AD Duration)”.\n\n As the EC explained, the “AD duration” was employed for obtaining the 6-month KSDA\nBond Matrix in Exhibit EC –125 with respect to certain PSL instances as to DSME. The AD duration\nwas explained as the difference between the Treasury Bond yield 1 year and Treasury Bond yield 6\nmont.sh. Given that a 6-months KSDA Bond Matrix exists, there is no need to consider the AD\nduration. Further, with respect to DSME, the EC did not apply the KSDA Bond Matrix. Instead, it\nfollowed the interest rate determ ination procedure under the KEXI M Guidelines Interest Rates and\nFees. In these circumstances, it is not necessary to consider the AD Duration. Please refer to\ncorrigendum with respect to DSME (Exhibit Korea – 146\n\n ¾ Korea submits Exhibits Korea – 145 through 149 for corrigendum on the EC’s\nrecalculation.\n\n While Korea does not agree with the EC’s methodology, Korea nonetheless submits Exhibits\nKorea – 145 through 149 on the EC’s benefit recalculation in order to correct manifest clerical errors\nby Korea in previous Exhibits and to identify the EC’s misunderstandings or false allegations.\n\n139. The Panel refers to Attachment 5 to the EC ’s replies to the Panel’s questions after the\nfirst substantive meeting, which contains transaction-specific alleged benefit calculations for one\nPSL and one APRG. Please make the same calculat ion for each of the APRGs and PSLs at issue\nin these proceedings. In other words, for each shipyard, specify which APRG I PSL relates to\neither LNG, product / chemical tankers, or cont ainer ships, and specify the amount of the\nalleged benefit as a % of the ship price. Please attach detailed worksheets.\n\nComment on the EC’s new factual information\n\nComments on Attachment EC – 11\n\n In Attachment EC - 11, the EC attempted to pr ovide the ad valorem benefits with respect to a\nfraction of PSL instances. Korea is compelled to point out below the serious fallacies contained in this\ndocument.\n\n ¾ Korea does not agree that benefits were conferred.\n\n As explained above, the benefit calculation me thodology by the EC including the selection of\nbenchmarks is affected by grave and inherent fa llacies. Hence, Korea rejects the existence of any\nbenefit and the magnitude of the be nefit alleged by the EC. Korea refe rs to its above explanations in\nthis regard.\n\n ¾ The EC’s PSL duration is false.\n\n This is another example to show the bad faith by the EC. As clearly indicated in Attachment\nKorea - 4 to Korea’s Second Written Submission and described in Korea response to EC Question 19,\nPSLs are disbursed in several instalments generally at the time of “steel-cutting”, “keel laying”, and\n“launching”. The number of instalments and disbur sement amounts vary depending on the projects.\nHence, each instalment must have a different duration.\n\n This notwithstanding, the EC applied the en tire period from the commitment date to the\nexpiry date as the duration of the PSL. This by itself is conflicting with it own benchmark which is a 6\nmonth KSDA Bond Matrix. In addition, Attachment EC – 11 itself refers to Attachment EC – 9,\nwhich, in turn, is based on Korea’s Attachment Korea - 4 above. Should the instalment disbursements\nbe taken into account, the calculation would be co mplex. However, irrespective of whether the\n\ncalculations are complex, the EC is not exempted from its obligation to provide correct calculations\n(assuming all other factors are established). To disregard this is not justifiable.\n\n ¾ The ad valorem benefit would be decreased substantially.\n\n Korea hereby submits Exhibit Korea – 150\n in order to show (i) again the duration of each\ninstalment disbursement as for the all projects for which the EC provided “projected” ad valorem\nbenefits and (ii) there are early repayments in so me cases, which must be taken into account for\ncalculation and to provide the PSL interest amounts that KEXIM charged.\n\n If the EC should count all of these factors, the ad valorem benefit would be decreased\nsubstantially.\n\nComments on Attachment EC – 12\n\n Also, as explained by Korea during the Second Substantive Meeting, the EC alleges that it\nestablished a benefit for a small fraction of APRGs only. The table below is the summary of those\ninstances. Korea submits this for the better understanding as to the egregiousness of the EC’s claim.\n\nShipyard Alleged number of APRG instances out of total\nAPRG transactions\nDSME 21/261\nMipo 0/126\nHHI 0/347\nSansung 4/141\nSamho 4/82\nHanjin 2/32\nSTX 2/126\nTotal 33/1115\n\nIn addition, in Exhibit EC – 12, the EC attempted to provide the ad valorem benefits with respect to a\nfraction of APRG instances. As with the PSLs, th e EC made the same egregious and bad faith\nattempts.\n\n ¾ Korea cannot, and shall not, agree on the existence of benefit.\n\n As submitted earlier, Korea cannot agree on the be nchmarks the EC proffered. As stated, in\norder to be eligible for constituti ng benchmarks, (i) the subject rates must be market representative in\nterms of instances and (ii) the terms and conditions must be comparable. However, the proffered\nbenchmarks are gravely lacking those criteria. Thus , Korea neither agrees that a benefit was conferred\nnor a benefit of the magnitude alleged. Korea refers to its explanations in this regard hereinabove.\n\n ¾ The EC disregarded the fact that advance payments are to be made in instalments.\n\n While the EC itself indicated in its Attachment EC – 12 that the advance payments are to be\nmade in instalments, the EC di sregarded this and took the entire period from the contract date to\ndelivery date as the duration for entire advance payments.\n\n While the EC finger-pointed Korea for not provi ding the relevant information, it should have\nmade, at least, an attempt for a reasonable reconstruction. Without this, the EC should be condemned.\n\n142. In percentage terms, how much of the a lleged benefit resulting from the “Daewoo” tax\nconcession should be attributed to DSME’s production of (i) LNGs, (ii) product I chemical\ntankers, and (iii) container ships? Please attach detailed worksheets.\n\nComment on the EC’s new factual information\n\n In Attachment EC - 13, the EC has re-quan tified the alleged subsidies received by Daewoo-\nSME by adding the alleged tax subsidy. The EC argues that the total benefit provided to Daewoo-\nSME under “scenario 1” 4 amounts to KRW 2,889,985 million which is summarized in the table\nbelow.\n\n In million KRW\nDebt-for-equity swap 649,089\nTax concessions: 55% * 236,000 129,800\nDebt rescheduling 173,153\nNegative net worth of DHI to be assumed\nby Daewoo-SME = 55%*3,523,533\n1,937,943\nTotal 2,889,985\n\n However, Korea has demonstrated that the DHI restructuring had been made under market\nconditions and that there was no bene fit conferred. Therefore, the EC ’s quantification of the alleged\nbenefits is fictional.\n\n Nonetheless, Korea would like to make a few comments below to show that, even under the\nEC’s incorrect assumptions, no benefit has been conferred or continues.\n\n (a) Debt-for-equity swap\n\n For those reasons presented by Korea\n5, KRW 3,500 which was the stock price on the first day\nof trading6 cannot represent the true value of the stock of DSME.\n\n Instead, the DSME creditors ag reed to the debt-for-equity swap as a long term investment,\nand Exhibit Korea – 103\n7 clearly demonstrates that the price of DSME shares as of August 2001 was\nin the range of US$ 10 (approximately KRW 12.000 – 13,000) per share.\n\n (b) Tax concessions\n\n As demonstrated by Korea\n8, the EC has failed to establish th at any financial contribution had\nbeen made to, or any benefit had been conferred upon, DSME in the form of tax concessions.\n\n (c) Debt rescheduling\n\n The EC has calculated the alleged benefit from the debt rescheduling based on the terms of\ndebt rescheduling (e.g., reduction of interest rates and changes in the repayment schedule of\nprincipals) as provided in the Comprehensive Agreement on Corporate Workout (MOU) of\n20 January 2000. However, the EC fails to recogni ze the fact that DSME graduated from the workout\n\n 4 This means an alleged scenario that DHI restructuring was not made under normal conditions and,\nthus, the company should have been liquidated.\n5 Korea’s Second Written Submission, paras 160 – 167.\n6 Attachment EC -13, Footnote 2.\n7 Non-binding Offer by Newcastle Heavy Industries dated 16 August 2001.\n8 See, e.g., Korea’s response to the Panel Question 116.\n\non 23 August 2001 due to its remarkable business perfor mance and that, as a result, the original terms\nof debt rescheduling under the above MOU have been cancelled.\n\n The following table summarizes the original terms of debt rescheduling under the MOU and\nthe revised terms of the principal and interest pa yments agreed upon between DSME and the creditor\nfinancial institutions at the time of termination of the DHI workout procedure:\n9\n\n Original terms under MOU Revised terms upon Workout termination\nTerms of\nrepayment of\nprincipal\nTo be repaid each year from\nand after 2003 in the amount\nequivalent to 5% of the total\nprincipal amount\nAs for KAMCO and SGIC, to be repaid in\nequal instalments during 2002-2003 (actually\nso repaid);\nAs for other financial in stitutions, to be repaid\nin equal instalments during 2002-2004\n(actually so repaid).\nTerms of\ninterest\npayments\nInterest on secured debt:\nPrime rate\nInterest on unsecured debt:\nPrime rate – 3%\nAs for financial institutions which have\napplicable interest rates for the outstanding\ndebt: the applicable interest rates at CB credit\nrating BBB or above.\nAs for those which do not have applicable\ninterest rates: the interest rates determined by\nadding not more than 2.5% to yield rates on\n3 year national treasury bonds.\n\n The EC also fails to acknowledge that mo st of the DSME debts assumed from DHI through\nspin-off (“workout debts”) have been repaid (or swapped into equity) during 2002 – 2004. Korea has\nprovided complete details of the changes in the interest rates during the DHI workout and at the\ntermination of the workout procedures, as well as the dates and amounts of repayments by DSME\ndebt principals.\n10\n\n As a result of such early repayment (or swap into equity as of 14 December 2000) by DSME,\nthe workout debts of DSME have been dras tically reduced from KRW 1,095 billion as of\n31 December 2000 to KRW 34.9 billion as of 31 December 2003.\n\n <Status of Workout Debt Repayments> (In billions of KRW)\n\n12/31/2000 12/31/2001 12/31/2002 12/31/2003\n1,095.3 187.7 74.8 34.9\n\n The EC argues that DHI obtained “gains on exemption of debts” of KRW 1,321,830 million\nand that, of this amount, KRW 173,153 million is to be allocated to DSME. The EC argument is\nbased on “DHI 1999 audited accounts.”\n\n However, these “debt exemption gains” i ndicated in the 1999 audited accounts were\ncalculated based on the assumption that the origin al debt restructuring terms under the MOU of\n20 January 2000 would continue to be implemented according to those terms. Because the MOU debt\nrestructuring terms have not been implemented as or iginally agreed, the EC’s benefit calculation is\nflawed even under the EC’s own ‘benefit’ calcula tions. Furthermore, the “gains” as used in\naccounting theory cannot be considered as equivalent to the legal concept of “benefit” within the\nmeaning of Article 1.1(b) of the SCM Agreement.\n\n9 See Exhibit Korea – 151, Korea Development Bank’s Notices on termination of DSME workout.\n10 Exhibit Korea - 77, Repayment of Debt Principal by DSME (Annex V Attachment 3.1(21)).\n\n Once again, it can be seen that the EC is ma king an argument that any debts restructured\nduring proceedings subsequent to insolvency are per se subsidies. The EC’s purported calculation of\nthe subsidy amount consists of the full debt load wit hout any restructuring. Of course, this is not in\naccord with the legal principles of any market economy, including those of each and every EC\nMember State. The EC has completely failed to pr esent to this Panel any workable model based on\neither normative or empirical standards for the proper amount of debt to be restructured. Of course, as\na matter of logic and as supported by the evidence, by the time there is an insolvency, the debt has\nbeen valued by the market. Restru cturing it is merely reflecting on th e books the reality of the market\nplace. There was no new equity being inserted into these companies; it was merely a matter of\nallocating the value as between the various classes of financial instruments. The only question is\nwhether these companies were kept in existence as going concerns rather than being terminated and\nsold off for scrap to obtain a higher value for the creditors. And the EC has presented no evidence that\nany creditors, either domestic or foreign or of any class of creditor favoured such a result.\n\n (d) Re-allocation of negative net worth\n\n Please refer to Korea’s response to the Panel Question 122.\n\n143. Is it the EC’s argument that the tax exem ption was determinative in the decision to\nmaintain Daewoo’s shipbuilding operations as a going concern, rather than liquidating them? If\nso, where is this reflected in the Arthur Andersen/Anjin report or in other documentation\nbefore the Panel?\n\nComment on the EC’s new factual information\n\n In Exhibit EC - 148, PwC argues that tax consequences of the DHI restructuring would result\nin lower values for the going concern scenario. B ased on this view, the EC argues that the tax\nexemption was a determining factor in the decisi on to maintain DHI’s shipbuilding operations as a\ngoing concern, rather than liquidating them.\n\n However, as elaborated by Korea in its respon se to Panel Question 116, the EC’s “core claim”\nbased on Article 46 of the Corporate Tax Act does not make sense, as the proposed DHI spin-off was\nto be made at book value (i.e., without valuation at the time of spin-off). Arth ur Andersen’s analysis\nof the going concern value had also been based on th e assumption that the spin-off would be made at\nbook value and, thus, no tax liability would arise under Article 46 of the Corporate Tax Act in\nconnection with the DHI spin-off. In that regard, c ontrary to the EC’s allegation, there were no tax\nconsequences that Arthur Andersen had to consider in its analysis of DHI’s going concern value.\n\n As indicated in Korea’s response to Panel Ques tion 116, even if the DHI restructuring had, in\ntheory, entailed a special additional tax, it was the remaining DHI as the “transferor” of the assets, not\n\nDSME that was responsible for any such liability under the Corporate Tax Act (Articles 2 and 99).11\n\n Therefore, the going concern value of DHI could not have been affected by such tax\nconsequences (if any), because DHI’s going concer n value was to be calculated on the basis of\nestimated cash flows from the shipbuilding and machinery operations of DHI (i.e., DSME and\nDHIM).\n\n 11 Exhibit Korea – 121, Articles 2 and 99(1). Moreover, the remaining DHI’s obligation to pay the\nspecial additional tax was to be deferred (i.e., the remaining DHI did not have to pay the tax following the spin-\noff) by virtue of Article 99(11) of the Corporate Tax Act, as the terms of DHI spin-off as assumed by Arthur\nAndersen satisfied all the criteria set out in Article 46 of the Corporate Tax Act.\n\n144. Para. 162 of Korea’s second oral statemen t refers to creditors rejecting the initial DHI\nworkout proposal. Were such creditors included in the EC’s claim of government entrustment\nor direction? If they were entrusted or directed by GOK, why / how did they reject the initial\nworkout proposal?\n\nComment on the EC’s new factual information\n\n Based on the Exhibits referred to in its respon se, the EC makes new arguments that distort the\nfacts relating to the rejection by certain creditors of the proposed DHI workout plan.\n\n As described in Korea’s First Written Submission\n12, the DHI workout plan itself (i.e., spin-\noff, debt rescheduling and debt-for-e quity swap) was rejected at the 3 rd CCFI meeting held on\n24 November 1999. Attachment 10 to Korea’s Fi rst Written Submission also shows that Agenda\nNos. 1, 2 and 3, which constituted key features of DHI workout plan, were rejected at the CCFI\nmeeting. Therefore, the EC’s allegation that “the general plan to restructure Daewoo-HI had been\nagreed to at the 3 rd CCFI meeting” (para. 83) is false. 13 The fact that the “ DHI restructuring plan”\nitself was rejected at that mee ting is also supported by the artic le from Seoul Economic Daily News\n(Exhibit Korea – 104) which clearly states that the “proposed workout plan” was rejected.\n\n Moreover, contrary to the EC’s allegation, the creditors who rejected the proposed workout\nplan included not only the investment trust companies, but also other financial institutions (mainly\nnon-secured lenders). The investment trust companie s accounted only for 31.99 per cent of the total\nvoting rights at the CCFI meeting\n14, while the actual voting results at the 3 rd CCFI meeting 15 shows\nthat the voting percentage of the dissenting creditors was substantially greater than 31.99 per cent. In\nthis regard, the article from Seoul Economic Daily Ne ws again confirmed that the issue was “the debt\nrecovery ratios between the secured and non-secured creditors,” 16 and therefore, was not confined to\ninvestment trust companies.\n\n In its response to the Panel question, the EC failed to explain why these creditors had rejected\nthe workout proposal if they were entrusted or direct ed by the Government of Korea. Instead, it tries\nto avoid this difficult question by focusing only on the 4 trillion Won Daewoo CPs because this was\nan issue for investment trust companies which pur chased Daewoo CPs, but not necessarily so for the\nother financial institutions which also rejected the purposed DHI workout plan.\n\n However, it is not clear what the EC is trying to establish by arguing that the investment trust\ncompanies objected to the treatment of the 4 trilli on Won CPs with the view that the Government\n(through KAMCO) would recognize the “clear inequities”\n17 and that, “consequently,” the loan was\npurchased by KAMCO at [BCI: Omitted from public version] of its face value. 18 First of all, with\nthis argument, the EC admits that the investment trust companies were not directed or entrusted to\naccept the proposed DHI workout plan. Instead, accord ing to the EC, the investment trust companies\nrejected the proposed workout plan in order to draw the Government’s attention to their problem.\n\n Second, the EC conceals the fact that it was almost one year later that KAMCO purchased the\nDaewoo CPs from the investment trust companie s (i.e., between September and December 2000).\n19 It\n\n12 See paragraph 351.\n 13 The EC relies on the ambiguous statement in Exhibit EC-55, but this must be read in the more\nspecific context of the CCFI meeting described in Attachment 10 to Korea’s First Written Submission.\n14 Attachment 9 to Korea’s First Written Submission.\n15 See Attachment 10 to Korea’s First Written Submission.\n16 Exhibit Korea – 104.\n17 The EC response, paragraphs 86 and 87.\n18 The EC response, paragraph 88.\n19 See the last paragraph in Korea’s reply to Annex V Questions at page 60 (Exhibit EC-39).\n\nis non-sensical to argue that the investment trust co mpanies’ rejection of the DHI workout plan that\ntook place on 24 November 1999 was the reason fo r KAMCO’s purchase of Daewoo CPs that took\nplace 1 year later.\n\n145. The EC requests an adverse inference regar ding Korea’s alleged failure to provide a\ncopy of the workout plan / report submitted by KDB on 24 November 1999. Please comment on\nthe explanation set forth at paras 194 and 195 of Korea’s second oral statement. If the EC still\nmaintains its request, what is the legal basis for that request? Why does the EC consider that\nKorea should have made this report available to the EC / Panel earlier?\n\nComment on the EC’s new factual information\n\n Korea still cannot understand the basis of the EC ’s request for adverse inferences and what\nthe EC tries to establish through the alleged adverse inferences.\n\n It appears that the EC assumes that “the wor kout plan” existed in the form of a separate report\nsimilar to the report prepared by Arthur Ander sen. This is not true. The KDB proposed a workout\nplan, based on the Arthur Andersen report, only in the form of “agenda” submitted to the CCFI\nmeetings. Attachment 10 to Korea’s First Written Submission clearly shows what the workout plan\nwas actually meant to be. In fact, the agenda No. 1 through No. 7 tabled before the 3\nrd CCFI meeting\nconstituted the “workout plan” proposed by KDB. There was no separate report containing the DHI\nworkout plan.\n\n On the other hand, in its very First Written Submission, Korea made clear that KDB had\nproposed a “workout plan” (i.e., agenda submitte d to the CCFI meetings) based on the Arthur\nAndersen report and that the initial workout plan ha d been continuously revised by KDB as the lead\nbank and proposed to the CCFI meetings in the form of agenda.\n20 Korea stated that the basic features\nof the workout plan had been finalized through th e third, fourth and sixth meetings of the CCFI. 21 In\nthis way, Korea made the existence of workout plan known to the EC and never concealed it.\n\n Therefore, the EC’s allegation that Korea re vealed the existence of the workout plan only\nafter the EC had highlighted it, is inconsistent with the submissions of Korea, and therefore must be\nrejected.\n\n158. (a) Is it the view of the EC that excess sh ipbuilding capacity exists only in Korea, or\nis there also excess capacity in other countries?\n\n (b) If your view that excess capacity ex ists only in Korea, please explain.\n\n (c) If your view is that there is excess capa city also outside of Korea, where and how\nmuch is the excess?\n\n (d) Is there any excess shipbuilding capacity in the EC? If not, what is the basis for\nthis conclusion?\n\nComment on the EC’s new factual information\n\n Korea notes that there is nothing in paragraph 55 of the OECD document in Exhibit EC – 151\nthat confirms that Korean shipyards have massively expanded as the EC claims. What the document\nstates is that Korea has stepped up capacity “by im proving productivity at its yards, especially its\nnewer facilities that started a more full range of operations since the mid-1990s”. If the increased\n\n20 Korea’s First Written Submission, paragraphs 351 – 353.\n21 Korea’s First Written Submission, paragraph 350.\n\ncapacity was achieved by improving productivity (for all Korean yards alike, restructured or not\nrestructured), the excess capacity is not caused by the alleged subsidies. Why would Korea have\nstopped productivity increases yielding lower costs, as the EC asserts it should have, because of\nexisting excess capacity in other shipbuilding countries? This makes no sense.\n\n159. The Panel's written question 30 following the first meeting was as follows:\n\n \"In general, how much flexibility does a typical shipyard have to produce all or a broad\nrange of ship types? What are the physical and other constraints on any given shipyard's\npotential product range? How important is prior experience to a shipyard's production cost and\ncapability to build a particular type of ship? With reference to the above considerations, please\ndescribe the capabilities and experience of each EC shipyard that produces or is capable of\nproducing some or all of the kinds of commercial vessels cited in your serious prejudice claim\".\n\n Please present a summary of any informatio n already before the Panel, including the\nAnnex V information, that is relevant to this po int but was not referred to in the EC's original\nanswer to this question.\n\nComment on the EC’s new factual information\n\nThe Clarkson World Shipyard Monitor for May 2004 now submitted by the EC in Exhibit EC - 152\nconfirms rather than rebuts Korea’s demonstration that yards do heavily specialize in specific ship\ntypes and size bands and that all yards do not build a full range or even a very wide range of vessels.\nExhibit Korea – 152\n hereto reflects some examples by way of illustration of what is contained in\nExhibit EC – 152 and confirms Korea’s position. There is, therefore, not supply-side substitutability.\n\n160. Concerning the composite ship newbuildin g price index furnished by the EC, the EC\nindicates that major shipbuilding consultants al so maintain \"more speci fic price information\nfor particular ship types\". In Attachment 2 to its answers to questions, the EC provides price\ninformation for two sizes of tankers and for eight sizes of container ships.\n\n (a) Is this the \"more specific\" info rmation to which the EC refers?\n\n (b) Why does the EC show the particular breakouts that it does? Do other\nbreakouts exist for these products? Please explain.\n\nComment on the EC’s new factual information\n\n It is a matter of opinion only as to what is the most commonly used source of newbuilding\nprices. There are many sources other than the “Clark son World Shipyard Monitor” referred to by the\nEC such as electronic databases, brokers, broker repo rts and other indices as indicated by Korea in its\nresponse to Panel Question 173.\n\n In addition, Exhibit EC - 152 does not supply price series indices for all ship types covered by\nother analysts and at the very least cannot, therefore, reasonably be described as the most\ncomprehensive source. The table provided by Korea in its response to Panel Question 173 d) shows\nthat both Lloyds Shipping Economist and Drewry pub lish prices series in their routine publications\nwhich include ship types and sizes not covered by Clarksons, i.e. Chemical Tankers, Refrigerated\nships (Reefers), General Cargo, LPG (more size options offered), Bulk Carriers (additional size\noptions) and containers (more size options). For th is reason alone, these other sources of ship prices\nmust also be considered for the purpose of the present proceeding.\n\n161. The EC presents indices of estimated Ko rean production costs versus prices in support\nof its argument that there is price suppression/depression. The EC indicates that its consultant,\n\nFMI, prepared the cost estimates, taking into account various known cost trends and cost\nadvantages of the Korean yards. The EC in its an swers to questions following the first meeting\nprovided a description of the methodology used by FMI to prepare these estimates. The EC also\nindicated that, should the Panel so request, it would furnish the detailed underlying data. Is it\nthe view of the EC that a graphical presentation of price indices, along with a description of\nmethodology, constitutes prima facie evidence of evolution in Korean shipbuilding costs? Please\nexplain.\n\nComment on the EC’s new factual information\n\n In connection with Exhibit EC - 156 (FMI ’s “cost modelling deta ils Angelicousis LNG\nTanker at Daewoo”), the EC does not explain the basis and methodology of FMI’s cost estimation.\nThe spreadsheet shows various cost categories and relative percentages of cost allocation between\ncost categories, but it fails to explain why and ho w such relative percentages between cost categories\nrepresent those of DSME.\n\n Korea has already shown that the EC’s cost estimation is unr ealistic. In Exhibit Korea – 108\n(Cost Analysis Report), KPMG has verified the actual costs incurred by DSME for production of\nLNG carriers and confirmed that FMI’s cost estimation was simply a fiction. FMI’s cost analysis is\nnothing but an “estimation” from various sources including EC yards and cannot replace the actual\ncosts. Moreover, it is based on FMI’s experience with the shipbuilding activity of European shipyards.\nIt is non-sensical to argue that such a fictitious an alysis can provide any plausible estimate of Korean\nyards’ costs.\n\n Interestingly, Exhibit EC - 156 concerns the “Angelicousis” project for which DSME has not\neven begun any production work and, therefore, has not yet incurred any actual cost of production.\nNonetheless, the EC claims that it already knows what the DSME cost would be.\n\n In this situation, it is ridiculous for the EC to state that these cost analysis have led it to\n“conclude” that prices offered by Korean yards are not in line with costs of production, and that this\ngap is widening.\n\n In this regard, Exhibit EC - 156 demonstrates that the EC’s argument on suppression or\ndepression is totally baseless and unrealistic, rather than supporting the EC’s claim.\n\n Korea has observed a number of times how the EC has attempted to use anti-dumping\ntheories to support it subsidies case and how ill they fit the treaty language. Now, in addition to trying\nto base their subsidization theory on a constructe d value approach, it may be observed from this new\nEC “evidence” that they have added the new oddity of apparently claiming that Korea is a non-market\neconomy and trying to use the EC to develop a surrogate price.\n\n162. What specific evidence/examples are contai ned in the information before the Panel in\nsupport of the EC argument that prices at on e end of the product spectrum for a particular\nkind of ship influence prices along the entire spectrum? (For example, is there specific evidence\nin the information before the Panel that a down ward movement in very large container ships\nbrings about commensurate downward movement in all smaller sizes of container ships?)\n\nComments on the EC’s new factual information\n\n The quotation by the EC in its paragraph 144 does not respond to the Panel’s question.\nIndeed, as the EC’s citation clearly indicat es, the document deals with the geographical\n market and\nindicates that the impact on one part of the geographical market is felt in the rest of the geographical\nmarket. That is totally different from stating that th e price of a particular kind of ship influences the\nprices along the entire spectrum of the like product ve ssels. Moreover, in any event, the statement by\n\nthe OECD Secretariat as referred to by the EC has been the subject of a specific disagreement entered\nby Korea and China.\n22\n\n In addition, the information presented by the EC itself in Exhibit EC – 152, page 8 of\nClarksons World Shipyard Monitor for May 2004 issu e, demonstrates that prices of different sizes of\nvessels, contrary to the EC’s allegations, do not move together.\n\n The scale on both the graph on this page and al so Figure 1 in Exhibit EC – 146 also referred\nto, obscures the detail of price trends. The following table takes the ship prices from page 8 of Exhibit\nEC – 152 and shows the year-on-year percentage vari ations of prices for the different types and sizes\nof ships.\n\nShip\n1997 v\n1996\n1998 v\n1997\n1999 v\n1998\n2000 v\n1999\n2001 v\n2000\n2002 v\n2001\n2003 v\n2002\nApr 04 v\n2003\nVLCC – 300,000 dwt 1%\n-13% -5% 11% -8% -9% 21% 12%\nSuezmax Tkr – 150,000\ndwt 2% -15% -3% 24% -11% -6% 18% 14%\nAframax Tkr – 110,000\ndwt 1% -16% -4% 26% -13% -3% 19% 16%\nPanamax Tkr – 70,000 dwt -16% 0% 16% -11% -2% 20% 9%\nHandy Tkr – 47,000 dwt 0% -17% 0% 13% -11% 3% 17% 16%\nCapesize BC – 170,000\ndwt 4% -19% 6% 16% -11% 1% 32% 17%\nPanamax BC – 75.000 dwt 2% -26% 10% 2% -9% 5% 26% 30%\nHandymax BC – 51,000\ndwt -2% -20% 11% 2% -10% 3% 26% 21%\nHandysize BC – 30,000\ndwt -5% -21% 9% -3% -3% 3% 20% 14%\nLNG 5% -17% -13% 5% -4% -9% 3% 9%\nLPG -9% -6% -3% 7% 0% -3% 9% 11%\nContainer - 725 teu -21% 4% 0% -7% 0% 35% 9%\nContainer - 1,000 teu -10% -3% 3% -14% 0% 19% 19%\nContainer - 1,700 teu -16% -6% 9% -14% -2% 21% 18%\nContainer - 2,000 teu -12% -3% 13% -11% -4%\n13% 8%\nContainer - 2,750 teu -18% 6% 14% -17% -5% 25% 14%\n\n 22 Korea refers to Document C/WP6/SNG/M(2004)1/REV.1 of 4 June 2004 which contains a revised\nsummary record of the OECD meeting of 29 – 30 March 2004 and provides at paragraph 14 that:\n\nKorea and China made it clear that they do not agree with one of the\ncharacteristics of the shipbuilding market described in paragraph 12(b),\nC/WP6/SNG(2004)2, which is not agreed among the SNG members.\nReference is also made to paragraph 17 of OECD Document C/WP6/SNG/M(2004)2 of 5 July 2004\ncontaining the summary record of the OECD meeting held from 27 to 28 May 2004 which refers to the\nfollowing statement by China:\nThe Delegate of China indicated that the effect of an individual transaction on\nother transactions should not be overstated, because a single shipyard’s\ninfluence is limited (due to the comp etitive nature of the market). Also,\ntransactions are all different, and shipbu ilding prices are not transparent in the\nmarket.\n\nShip\n1997 v\n1996\n1998 v\n1997\n1999 v\n1998\n2000 v\n1999\n2001 v\n2000\n2002 v\n2001\n2003 v\n2002\nApr 04 v\n2003\nContainer - 3,500 teu -16% -10% 9% -13% -8% 29% 13%\nContainer - 4,600 teu -13% 26% 15%\nContainer - 6,200 teu\n-17% 18% 15%\nRoRo 1,200 - 1,300 Lm 10% -7% -5% -3% 19% 9%\nRoRo 2,300 - 2,700 Lm 8% 2% -6% 0% 6% 9%\n\nIndex -2% -15% -4% 7% -5% -2% 12% 12%\nNote: Tkr = tanker, BC = bulk carrier, LPG = Liquefied Petroleum Gas, Lm = Lane metres\n\n The maximum and minimum percentage price ch anges are shown in bold and highlighted in\nyellow. It can be seen that there is a huge variety of differing trends between both ship types and\ndifferent sizes of ship, which is consistent with the fact that there are a range of factors which\ninfluence price as stated by Korea previously.\n23 For example:\n\n• At end 1999 compared to end 1998 : The largest (VLCC) tanker prices had dropped by 5 per\ncent whilst the two smallest (Panamax & Handy ) showed no change; The largest bulk carrier\nhad risen by 6 per cent whereas the Handymax had ri sen by nearly double that at 11 per cent;\nthe 3,500 teu container ship price had dropped by 10 per cent whereas the 725 teu and 2,750\nteu prices had risen by 4 and 6 per cent respectively.\n\n• At end 2002 compared to end 2001 : The largest (VLCC) tanker has dropped by 9 per cent\nwhereas the smallest (Handy) has risen by 3 pe r cent; the Capesize Bulk carrier had risen by\n1 per cent whereas the strongest rise was shown by the Panamax bulk carrier which had risen\nby 5 per cent; the two smallest (750 teu and 1, 000 teu) container ship s had shown no change\nwhereas the price for the largest (6,200 teu) had dropped by 17 per cent; the price for the\nlarger Ro-Ro remained stable whilst that of the smaller vessel dropped by 3 per cent.\n\n Virtually every year shows examples of diffe rences like these. There are also certain common\noverall trends often reflecting world-wide macro-ec onomic factors, e.g., all prices showed decline\nbetween end 1997 and end 1998 and all prices showed an increase between end 2002 and end 2003\nbut even then the strength of movement varied from –6 per cent to –26 per cent from 1997 to 1998\nand from 3 per cent to 35 per cent from 2002 to 2003. In other years the trend is mixed with some ship\nseries showing prices rising and others showing prices dropping but still with significant differences\nin absolute percentage change.\n\n To clarify that this variability has existe d across the whole time period, the maximum\nvariations from the 21 price series for each of the yearly comparisons are:\n\n• 1997 v 1996: -9% to +4%\n• 1998 v 1997: -6% to –26%\n• 1999 v 1998: -13% to +11%\n• 2000 v 1999: -7% to +26%\n• 2001 v 2000: -17% to 0%\n• 2002 v 2001: -17% to +5%\n• 2003 v 2002: 3% to 35%\n\n23 Korea Exhibit 70, Korea response to Panel Question 124 and 125.\n\n These are enormous variations that cannot be dismissed on the basis of gross, macro-level\npricing charts. As Korea has pointed out in many instances regarding the EC's assertions, such a\nsuperficial level of analysis as the EC offers here would never be accepted from a domestic\ninvestigating authority and it follows that the Pa nel cannot base its own decision on such misleading\ngeneralities. The EC's generalized assertions conceal more than they reveal.\n\n163. (a) For each ship category, in prac tical terms how substitutable are different\nsizes/configurations (containment syst ems, in the case of LNGs)? Are there\nspecific evidence/examples in the inform ation before the Panel? In addition,\nplease furnish relevant portions of the industry publications discussed at the\nsecond meeting. (For example, one industr y expert referred at the meeting to\none of the industry publications that contains information relevant to cross-price\nelasticities).\n\n (b) Can the EC cite specific instances/situ ations in the information before the Panel\nwhere a shipowner has purchased and u sed a larger-than-usual ship for a\nparticular run, due to a relatively low price for the larger ship?\n\nComments on the EC’s new factual information\n\n Korea refers to its comments above as regards the factual information submitted by the EC in\nresponse to Questions 159 and 162.\n\n The EC attempts to allege that the estab lishment of cross-elasticities must be assessed\nindependently from demand factors because alle gedly demand has been disconnected from price\nbecause of overcapacity. It then tries to assert that there is cross price elasticity by comparing the\nprice development for one single type of tankers (Panamax tankers) by comparing the price\ndevelopment for this single ship type against the development of a price index for a non-specified\nscope of vessels but which seems to cover many di fferent ship types incl uding those that are not\nconcerned by the present proceeding. In fact, however , Korea has argued all along that several factors\ncontribute to the price level for vessels including demand.\n24 At the same time, it is a gross\nexaggeration to assert as does the EC that for the purpose of determining price elasticities, the demand\nfactor must be neutralized because of the exis tence of overcapacity. Thus, for the example of\nPanamax tankers chosen by the EC itself, pages 4 and 5 of Exhibit EC – 152 show an increase in\norders from 2002 to 2003 and a corresponding in crease in prices, alleged overcapacity\nnotwithstanding.\n\n The demonstration by the EC for one single vessel type is neither a complete response to the\nPanel’s question nor representative of the vessels concerned by the present proceeding. This is true all\nthe more because significant confusion has always existed in the EC’s definition of the product and\nchemical tankers concerned by this proceeding and it is not clear to what extent the Panamax tankers\nreferred to in Exhibit EC – 152 coincide with the co mbined product and chemical tankers that the EC\nclaims to be the subject of the present proceeding. In addition, however, there are significant flaws in\nthe EC’s presentation, i.e.:\n\n• The EC has used the example of a Panamax ta nker which it cites as having ‘little change in\ndemand but significant movement in price’ but this is not corroborated by the data on Pages 4\nand 5 of the Exhibit EC – 152.\n\n• Page 4 and 5 of Exhibit EC – 152 show that for Panamax tankers, the ordering trend for Apr\n2004 (year to date orders) against last year is shown as ‘ down by 19 per cent ’ and the order\n\n24 As last reiterated in Korea’s response to Panel Questions 124 and 125.\n\nvolumes in both dwt and cgt 25 in 2003 are shown as, respectively, ‘77 per cent and 82 per\ncent up’ on the levels of 2002. This does not indicate a condition of constant demand.\n\n• Figure 2 shows a line which is by no means constant 26 and moreover month on month order\nlevels changes are not usually treated as significant trends in themselves.\n\n• The trend is shown over a short time period of one year, during a period where all prices were\nseen to be rising to varying degrees.\n\n• In Figure 3, the EC plots the Panamax price against the FMI newbuilding price index, to try\nand demonstrate a correlation with overall shi pbuilding price movements. The detailed basis\nof construction of the FMI index is not known, but Korea has indicated before that price\nindices need to be used with extreme care. To demonstrate this, attention is drawn to the\nClarkson’s price index on Page 8 of Exhibit EC – 152, where at the end of 1996 and the end\nof April 2004 the index is shown to be the sa me (at 133) but the prices for the various ship\nseries are in fact significantly different – the most extreme being the Capesize bulk carrier at\n$39 million at the end of 1996 and $56 million at the end of April 2004. The correlation (or\notherwise) of a particular ship series with a price index is not an indication that price\nmovements or levels are constant within or across ship types and sizes.\n\n166. (a) For each of the three ship types, wh at specific evidence/examples are there in the\ninformation before the Panel (in addition to the domestic complaint by Samsung\nagainst Daewoo) that the restructured shipyards were the price leaders among\nthe Korean producers?\n\n (b) What evidence is there in the informat ion before the Panel in support of the EC\nargument that the alleged restructuring subsidies enabled the restructured yards\nto drive down the prices charged by all other Korean shipyards?\n\n (c) What has been the annual financial performance of the other (non-structured)\nKorean shipyards since the restructuring?\n\nComments on the EC’s new factual information\n\n Acknowledging that there is no responsive inform ation currently before the Panel, the EC\nattempts to rely on new information in Exhibit EC – 152 that was not already before the Panel. The\nEC thereby fails to appropriately and accurately r espond to the Panel’s question. In any event, Korea\nnotes that the data shown at page 16 of Exhibit EC – 152 shows only the total output in 2003 or total\norderbook as at April 2004 for each yard (recognizing again the near uselessness of the orderbook for\ncalculating annual market shares). It therefore does not provide any information regarding the\nrespective market shares in each of the different ship types as requested by the panel. Because the data\nis across ship type, the ranking is based on the cgt figure, which allows the workload of different\ntypes of ships to be aggregated. This gives no actual reflection or measurement, however, for the\nrespective market position of the restructured yards for the ship types subject of the present dispute.\nMost importantly, it gives no support at all to any argument that the alleged subsidies resulted in price\nleadership. Indeed, it demonstrates that the EC ha s abandoned this critical causal link. Hence, as\nExhibit EC – 82 as well gives no evidence on an alleged price leadership specifically of the\nrestructured yards and, in particular, in a causal fashion that somehow affected the un-restructured\n\n25 Information on page 5 of the Exhibit.\n26 The source of this monthly data does not seem to be in this Exhibit EC – 152.\n\nKorean yards in a special manner of some sort, the EC has failed to provide any evidence as requested\nby the Panel.\n 27\n\n Korea refers to its comments to the Pa nel Question 162 regarding the EC’s claim in\nparagraph 162 that low prices have a contagious eff ect in shipbuilding. On a point of detail, the EC\nalso makes an error in interpreti ng the extract from Exhibit EC – 82 when it asserts that three of the\nfive big chaebols referred to are restructured ship yards. The reference to the 5 big chaebols is to\nHyundai, Daewoo, Samsung, Hanjin and Halla, of which only 2 are (the antecedents of) restructured\nshipyards – Daewoo and Halla.\n\n168. The parties disagree as to whether APRG s constitute export credit guarantees and\nwhether PSLs constitute export credits. Plea se provide any documentation (either from the\nshipbuilding industry, the OECD, or any other so urce) that you consider supports your position\non these issues.\n\nComment on the EC and US new factual information\n\n The EC cites the so-called Knaepen Report to support its narrow reading items (j) and (k),\nfirst paragraph, of Annex I to the SCM Agreement . However, this illustrates the issue of the\nimpropriety of making the WTO subservient to th e OECD for interpretation of WTO treaty language.\nIn its response, the EC acknowledges that the OECD was silent on the point of calculating premia at\nthe time of conclusion of the Uruguay Round. But the EC offers its interpretation of a later OECD\nagreement to the effect that only reference to the buyer-country is u sed and therefore this later OECD\nagreement should be binding on the interpretation of items (j) and (k), first paragraph.\n\n First, Korea does not agree with the interp retation put by the EC on the Knaepen Package\nwhich merely sets guidelines for determining premia in the case of an export country risk but does not\nstate what other risks can occur in case of an export credit. There is nothing in the language that\ncompels a limitation in terms of risk factor or recipient of the fac ility. The EC also ignores the fact\nthat, as Korea demonstrated in its answer to Question 168, many WTO Members (including a number\nof EC Member States) issue just the sort of credits and guarantees as provided by KEXIM. These take\ninto account a number of risk factors, but explicitl y state that they take into account buyer political\nfactors regardless who the direct recipient of the inst rument is. As was also demonstrated by Korea in\nits answer, there is no limitation based on whom is th e recipient of the credit or guarantee. Indeed, it\nwould create a huge loophole to do otherwise. In light of the EC’s stance and the evidence Korea has\nsubmitted, Korea must once again ask the question: is the EC admitting on the record that it considers\nits Member States to be offering prohibited export subsidies?\n\n Second, even if one were to agree arguendo with the EC’s interpretation of the Knaepen\nPackage in the context of the OECD, such an OECD interpretation cannot bind the whole of the WTO\nMembership. It illustrates perfectly the fallacy of the EC’s approach. Accord ing to panels and the\nAppellate Body, the narrow exception of item (k), second paragraph, applies to the OECD\nArrangements even though the OECD is not menti oned. This has been both troublesome and\ncontroversial given the narrow base of OECD Membersh ip. However, to try to claim that this narrow\ngroup can self-define on behalf of the whole WTO Membership the meaning of other WTO treaty\nterms such as those in items (j) and (k), first pa ragraph, is unacceptable. The WTO is not subservient\nto the OECD. Whatever might be the OECD’s role under the narrow exception of item (k), second\n\n 27 To avoid any possible confusion, Korea would like to clarify that the column s headed Capacity* at\npage 16 of Exhibit EC – 152 is not an assessment of capacity in accordance w ith OECD accepted guidelines.\nThe footnote qualifies that the first three columns provide details of the number of building berths and docks\nand maximum length of these, the fourth column is the largest individual vessel built at the yard measured in\ngross tons since 1991, and the fifth column is the maximum annual output in CGT since 1991 which can still be\nconsiderably less than the capacity.\n\nparagraph, that is the extent of its legal authority with respect to the WTO treaty.28 The OECD’s remit\ndoes not in any manner go to defining the WTO treaty terms in a manner binding on the DSB and the\nWTO Membership.\n\n Furthermore, without some sort of dispute resolution mechanism within the OECD, there is\nsimply no basis for stating that the OECD has assi gned a certain meaning to a term. The EC and its\nMember States do not control the interpretation of OECD provisions. If another OECD Member such\nas Korea disputes the interpretation of OECD language being offered by another OECD Member such\nas the United States or the EC Member States, then this Panel cannot simply take the EC’s word on it\nfor what the OECD Arrangement provides. That is one of the many reasons why the Panel must\ninterpret such terms as “export credits” or “export credit guarantees” on the basis of their ordinary\nmeanings, not on a self-serving interpretation of the OECD Arrangement offered by the EC.\n\n The United States submits some responses fro m the US Ex-Im Bank in response to the\nPanel’s question. Korea notes that the US takes a much narrower a pproach to defining terms than it\nhas in other contexts in the WTO.\n29 But, perhaps not -- Korea notes th at the response is quite strictly\nphrased as that of the US Ex-Im bank and not the US government as a whole. The submission\nconcludes: “Because the Ex-Im guarantee covers the ri sk of the US exporter, rather than the foreign\nbuyer, Ex-Im does not consider this program to be an export credit within the meaning of the OECD\nArrangement.” (Emphasis added) This answer may be all that Ex-Im is le gally permitted to expound\nupon, but it is not responsive to the Panel’s question. It also illustrates the difficulty with the EC’s\nresponse as well. The question was whether it is an export credit within the meaning of the WTO\ntreaty, not the OECD Arrangement . The US answer is illuminating, but more for what it does not say\nthan what it does.\n\n173 (a) For each of the three ship types at issue in this dispute, how are ship data\nnormally maintained by the industry, and by industry analysts?\n\n (b) In particular, are these three categori es of ships recognized and used routinely\nfor purposes of industry analysis?\n\n (c) If so, how are they defined, and for what purposes are these categories used?\n\n (d) When analysts report on pricing tre nds, do they normally refer to prices for\neach category as a whole, or for subcate gories thereof, broken out, for example,\nby size and/or other characteristics.\n\n (e) If they provide a range of pricing in formation at different levels of aggregation,\nhow are these different data series used?\n\n (f) Please provide documentation (including in particular relevant excerpts from\nthe published industry reports discussed at the second meeting) showing\nexamples of the various breakouts to which you refer.\n\n 28 Korea also notes that extreme caution must be exercised on this i ssue of what the OECD\nArrangements mean. Korea has had to illustrate to the Panel a number of instances when the EC has cited\ndocuments that do not reflect a consensus within the OECD. Even worse, the EC has attempted several times to\ncite OECD Secretariat language that the EC would (at le ast in instances when it is convenient) have the Panel\nrefer to as controlling interpretations of WTO treaty language. Often it is not even clear if it is an official OECD\nSecretariat view or that of some individual staff me mbers. Certainly OECD Secretariat views cannot be\nconsidered controlling; indeed, regarding the WTO treaty, they cannot be considered authoritative.\n29 See Korea First Submission, para. 275, footnote 177, citing: www.fas.gov.itp.wto.disciplines.htm.\n\nComments on the EC’s new factual information\n\n Lloyd’s Register in Exhibit EC – 155 groups their ship type categories of:\n\n• ‘Chemical/oil products tanker’ under the basic grouping of Chemical vessel s. It is clear from\nthis that it is the intention that this category would comprise vessels with chemical capability\nand hence an IMO Chemical Class.\n30\n\n• ‘Oil products tankers’ under the basic grouping of Oil along with Crude oil tankers.\n\nAdditionally, it should be noted that Clarksons, in their publications and databases which are referred\nto by FMI (including Exhibit EC – 152), classifies its oil and chemical tanker data as follows:\n\n• Tanker - refers to an uncoated vessel, i.e. cargo tanks are not coated\n• Product tanker – refers to a coated vessel, i.e. cargo tanks are coated\n• Chemical and oil carriers - refers to vessels with some form of IMO grade tanks (IMO I to\nIII)\n\n It is clear that these two reputable industry data sources, submitted as Exhibits by the EC,\nboth consider vessels with any chemical capability to be a separate category to oil tankers and\nspecifically to products tankers.\n\n The EC and FMI have, however, chosen to i gnore this and to try to group together some\nvessels with chemical classification with oil products tankers. Thus, they have artificially separated\nsome chemical vessels from others and\n separated oil products tankers from other oil tankers such as\ncrude tankers. Their categorization and analysis do es not therefore reflect the main industry sources\nthat they have, themselves, identified here. The classification used by FMI and the EC does not,\ntherefore, broadly follow this taxonomy as claime d, and in the case of product/chemical tankers\nactually cuts right across it.\n\n The above comments make it clear that the ship price series referr ed to by the EC in Exhibit\nEC – 152, do not include price trends for chemical vessels.\n\n The EC also erroneously describes the price i ndex published in Exhib it EC – 152 on page 8\n‘Shipbuilding Price Trends’ as one relating to the average movement of tankers and bulk carriers\nwhen it is in fact constructed from price moveme nts on a wider range of ship types including, as\nconfirmed by Clarksons, tankers, bul k carriers, container ships and other dry cargo ships. Korea’s\nprevious comments on the caution required when using price index data are corroborated by this fairly\nbasic error made by the EC and its advisors who see m, in fact, to place such store on this one data\nsource to the exclusion of others.\n\n174. Korea argues that demand should be measur ed in numbers of vessels, and/or workload\nyears (i.e., order backlog) rather than compensa ted gross tons of new orders. The EC responds\nthat CGT is more accurate as a measure of s upply and demand, and that even measured in\nworkload years, demand trends are as represented by the EC.\n\n (a) Could each party explain the technical differences between the two measures,\nand provide further detail as to why it believes its preferred measure represents\na more accurate picture of demand than the other.\n\n 30 Korea has already noted that it is always necessary to be alert to the possibilities of anomalies caused\nby data input errors or misreporting.\n\n (b) Which measure is used by industry analysts and the industry when analyzing\ndemand trends?\n\n (c) If both are routinely used, please ex plain the circumstances in which they are\nused, and provide examples from independently prepared sources (the published\nindustry reports discussed at the meeting, OECD documents, etc.).\n\nComments on the EC’s new factual information\n\n The Exhibits referred to by the EC do not s upport the conclusion drawn by the EC. Whilst the\nEC in referring to Exhibits EC – 152 and 155 has high lighted that there are a range of units provided\nwhich are used according to the requirements of the analysis, (as stated also by Korea\n31), there is a\nsignificant difference between stating that CGT is almost solely used in relation to shipbuilding and\ninferring that it is also the only measure used in shipbuilding. The EC makes reference to the OECD\nuse of the measure in capacity evaluation in Exhibit EC – 151, which is entirely appropriate, as it\nrelates to capacity and cross sector capacity-demand balance. However, it makes no reference to the\nOECD’s use of other measures such as, for example, in their own shipbuilding information statistics\nwhich show numbers of vessels, gross tons and CG T as is demonstrated in the OECD statistics on\nship production, exports and orders in 2003 (D ocument C/WP6/SG(2004)5 of 2 May 2004 of which\nexcerpts are submitted herewith in Exhibit Korea – 153).\n\n The EC is wrong in paragraph 189 to infer from its reference to Exhibit EC – 151, that ‘The\nnumber of ships is of limited statistical significance in statistical analysis of either the shipping or the\nshipbuilding industry….’. For example: it does not seem to recognize that one of the two main\nelements of shipbuilding demand – replacement de mand – has to be based on an analysis of the\nnumbers of ships likely to be taken out of service over a given time period.\n\n Any analyst recognizes that there is a huge difference between a shipyard that has an\norderbook or annual output of 150,000 cgt comprising:\n\n• a single vessel e.g. 120,000 cgt cruise ship\n• 3 large crude oil tankers e.g. 316,000 dwt VLCC\n• 6 large oil product tankers e.g. 72,00 dwt product tankers\n• 12 small bulk carriers e.g. 30,000 dwt bulk carriers\n• a mix of more sophisticated ship types e,g. Ro-Ro, cable layer, ferries\n\nAll of the above options could equate to the same cgt value but a very different workload or order\nportfolio.\n\n175. In response to EC arguments concerning ma rket share as a factor in price leadership,\nKorea variously states that market share does not demonstrate price leadership, but also that\nKorean yards' market shares are too small for them to be able to influence prices. Both sides\nthus seem to view market share as somehow relevant to the question of price leadership.\n\n (a) How (on the basis of what sort of concrete data and analysis) can price\nleadership be determined/established?\n\n (b) What role in such an analysis would levels and trends in market shares play?\n\n (c) How large a market share would a give n market participant need to be able to\nexercise price leadership.\n\n31 Korea’s response to Panel Question 173 b).\n\n Page 16 of Exhibit EC – 152 refers to capac ity but, as mentioned in Korea’s comments to\nPanel Question 166, not in any terms that are used by the OECD. In addition, any reference to existing\ncapacity does not mean that there is any excess capacity as such that would explain, as the EC tries to\nportray, a fierce price competition among Korean shipyards triggering price depression or\nsuppression, let alone prove that the subsidies themselves caused the price depression or suppression.\nFinally, the so-called capacity shown in the relevant page is global capacity and not, as the EC tries to\nportray, capacity in the market sectors concerned by the present proceeding . Hence, this data cannot,\nin any event, support the view that excess capacity caused price depression or suppression for\ncontainerships, product and chemical tankers or LNGs.\n\n As mentioned above, paragraph 10 of the OE CD document supplied by the EC has been\nvigorously contradicted by Korea and China (see Korea’s comments to Panel Question 162).\n\n Finally, whether in Exhibit EC – 82 or in Exhibit EC – 157, reference is made to the Korean\nshipyards as a whole and not to each of the three restructured shipyards individually. Thus, the EC has\nnot responded to the Panel’s question in particular in subsection (c) thereof. But, in addition, there is\nnothing in these documents to support the view that the subsidies themselves caused price depression\nor suppression. Even if there were excess capacity on the part of the Korean yards that did not\nundergo restructuring that would have brought these yards to lower prices (which Korea disputes),\nthis would still not demonstrate that the subsidies granted to the allegedly restructured yards caused\nprice depression or suppression, all the more that there are other large shipyards on the market that\nparticipated vigorously in the bids for the vessels concerned by this dispute.\n\nList of Exhibits\n\nExhibit Korea – 140 Letter by ABN-AMRO re country risk premium\n\nExhibit Korea – 141 Anjin comments on the PwC analysis in Exhibit EC – 145\n\nExhibit Korea – 142 “Background report – Detailed eval uation of key price movements”\nprepared by the EC’s consultant, FMI, in August 2003\n\nExhibit Korea – 143 KEXIM report regarding the incompatibility between credit and\ncorporate bond ratings\n\nExhibit Korea – 144 KEXIM’s list of PSLs (excerpts)\n\nExhibit Korea – 145 Corrigendum to the EC’s recalculation on Samho\n\nExhibit Korea – 146 Corrigendum to the EC’s recalculations on DSME\n\nExhibits Korea – 147 Corrigendum to the EC’s recalculations on Hanjin\n\nExhibit Korea – 148 Corrigendum to the EC’s recalculations on HHI\n\nExhibit Korea – 149 Corrigendum to the EC’s recalculations on Mipo\n\nExhibit Korea – 150 PSL duration for each instalment disbursement\n\nExhibit Korea – 151 Korea Development Bank’s Notices on termination of DSME\nworkout\n\nExhibit Korea – 152 Absence of supply-side substitutability as demonstrated in Exhibit\nEC – 152\n\nExhibit Korea – 153\n OECD statistics on ship productio n, exports and orders in 2003,\nC/WP6/SG(2004)5 of 2 May 2004 (excerpts)\n\nNOTE\n: Exhibits containing Business Confid ential Information are shown in bold\nhereinabove.\n\nANNEX G-6\n\nCOMMENTS OF KOREA ON THE RESPONSES BY THE\nEUROPEAN COMMUNITIES TO SUPPLEMENTAL\nQUESTIONS\n\n(23 July 2004)\n\nII. TO THE EC\n\nA. APRG/PSL\n\n187. Please comment on Korea’s recalculations of benefit in Exhibits Korea - 91-102.\n\nKorea’s comments\n\n Please refer to Korea’s comments on the Panel’s Question 136 to the EC at pages 16 to 23 of\nKorea’s submission of 9 July 2004.\n\nB. ALLEGED ACTIONABLE SUBSIDIES\n\n188. Concerning the question of whether the rest ructuring of Daewoo was subsidized, please\nprovide a summary, based on all of the submission s of Arthur Andersen/Anjin and PwC, of the\nEC’s analysis and conclusions in respect of whether DHl should have been liquidated instead of\nrestructured. In this summary, all relevant figures should be shown in tabular from, with cites\nand cross-references to the original Arthur Andersen report of November 1999 assessing the\nvalue of DHI under various scenarios.\n\nKorea’s comments\n\n Nothing in Exhibit EC-158 (PwC’s Report) est ablishes that DHI should have been liquidated\ninstead of restructured. Despite all of the anal yses which PwC attempted to build in its various\nreports, PwC continuously concludes that the goi ng concern value of DHI was greater than the\nliquidation value or that “it is not clear” that the going concern scenario, after taking into account the\ncorrection for the tax shield effect, would have remained the preferred solution.\n\n In any event, PwC’s assertions are based on a mis-presentation of facts and an application of\nfinance theory that makes no sense. Exhibit Korea-141 (Anjin’s 2nd Response) clearly demonstrates\nthat the restructuring of DHI was the best solutio n for the creditors. In addition, Korea submits as\nExhibit Korea – 154\n Anjin’s 3rd Response, dated 23 July 2004, to the PwC’s report (Exhibit EC-\n158).\n\n189. Concerning the Daewoo restructuring:\n\n (a) Concerning the most recent PwC submission (Exhibit EC - 145), please explain\nin detail the statement at page 3 that the Anjin analysis indicated “that the\n\nEnterprise Value of the restructured company is lower than the Enterprise\nValue of the company computed without debt restructuring”.\n\n (b) What is “enterprise value” and how does it differ from “going concern value”?\n\n (c) What is the significance of the fact that the “enterprise value” was lower under\none set of calculations than under another? How if at all does it affect the central\nissue raised by the EC, namely the deci sion to restructure instead of liquidate\nDaewoo?\n\n (d) What is the significance of Anjin’s reply in Exhibit KOR-7O that enterprise\nvalue was reduced under the analysis of the restructuring scenario from what it\nhad been under the valuation of tile non-restructured company? What if\nanything is the significance that enterprise value calculations differed under two\nscenarios for the central issue posed by th e BC, namely whether it was better to\nliquidate\n or to restructure Daewoo?\n\nKorea’s comments\n\n Please see Section III.2 of Exhibit Korea – 154 (Anjin’s 3rd Response) for detailed\ncomments on the EC’s reply.\n\n As explained in the above section, the EC is trying to mislead the Panel by concealing the fact\nthat the debt-to-equity swap contemplated in the DHI restructuring reduced the enterprise value of\nDHI as a restructured company by increasing the We ighted Average Cost of Capital (the discount\nrate). Contrary to the EC’s allegation, Anjin (A rthur Andersen)’s calculation of the enterprise value\nwas accurately made in accordance with the fina nce theory and there was no underestimation or\noverestimation.\n\n Consequently, the EC’s allegation that Arthur Andersen suddenly took into account the value\nof the remaining DHI’s assets in order to come up w ith a post-restructuring enterprise value that is\nhigher than the pre-restructuring value, is totally without merit. Moreover, Korea has demonstrated, as\nsupported by Anjin’s report (Exhibit Korea-141), th at the size of any recoverable amounts from the\nremaining DHI does not make any difference in th e comparison between the going concern value and\nthe liquidation value, because the same estimated recoverable amount was incorporated into both the\ngoing concern value and the liquidation value. Please see also section III.2.2 of the Exhibit Korea-\n154, Anjin’s 3rd Response.\n\n The EC argues that the liquidation value of [BCI: Omitted from public version] was a\n“new fact”. However, this figure was not a “new” fact. As explained in Section III.1.1 of Exhibit\nKorea- 154 it was already presented in the 1999 Arthur Andersen Report (Appendix 11). This means\nthat when the creditors consider ed all the valuations presented by Arthur Andersen in the 1999\nReport, they also considered the amount of [BCI: Omitted from public version] which was\nmentioned in that Report.\n\n In fact, the 1999 Report, as analysed and cl arified by PwC and Anjin in their numerous\nreports submitted to the Panel as exhibits, clearly demonstrates that this 1999 Report was a thorough\nand comprehensive report based on in-depth analysis and gave the creditors reliable information in\ndeciding on the restructuring of DHI. The 1999 Report shows that, when it made its assessment, Anjin\nconsidered carefully all the relevant data a nd circumstances relating to the Korean economy,\nshipbuilding industry and individual shipbuilders, as well as the business plans of DHI, in order to\nprovide an objective and independent assessment of the real situation of DHI and of the various\noptions available to the creditor financial instituti ons. Therefore, the creditor banks acted prudently\n\nwhen they decided on the DHI restructuring ta king into account the findings and recommendations\ncontained in the 1999 Report.\n\n190. The data presented in Exhibit KOR-108 show interest and depreciation expense in the\ncost/profitability analysis for Daewoo. Please comment. How can this be reconciled with the\nEC’s assertion that these costs have not been adequately reflected in Daewoo’s prices?\n\nKorea’s comments\n\n (i) With regard to paragraph 9 of the EC’s response:\n\n Please see the document entitled “Response to Para. No. 9” in Exhibit Korea – 155\n\n(KPMG’s Supplemental Response) for comments on this paragraph.\n\n (ii) With regard to paragraphs 10 and 11 of the EC’s response:\n\n Please see “Response to Para. Nos. 10 and 11” of Exhibit Korea – 155 for comments on\nparagraphs 10 and 11.\n\n (iii) With regard to paragraph 12 of the EC’s response:\n\n As conceded by the EC itself, KPMG has comp ared the cost estimates or assumptions made\nby FMI with the real costs incurred by DSME. KPMG has found that FMI’s cost\nestimates/assumptions were extremely higher than the real costs.\n\n Of course, the real costs incurred by DSME were based on the debt situation of DSME after\nthe debt restructuring was made, as the actual construction of the vessel was carried out after the debt\nrestructuring in October 2000. Nevertheless, contra ry to the EC’s allegation, KPMG also confirms\nthat, even if the pre-restructuring debt alleged by the EC had been taken into account, DSME could\nhave offered the price of [BCI: Omitted from public version] that would still have yielded revenue\nand profit (see section 2.5.4 of Exhibit Korea- 108 (KPMG’s Cost Analysis Report)). KPMG has\nconfirmed that the ordinary income from the thre e LNG carrier projects ranged from 18.8 per cent to\n28 per cent of the sales revenue. Under these circumst ances, even if the “pre-restructuring” debt\nservicing costs alleged by the EC were reflected in the DSME’s cost base, the projects would still\nhave generated a substantial ordinary profit.\n\n This means not only that the FMI’s “cost estimation or assumption” bears no relationship\nwith reality and that it is useless for providing an y sort of indication or guidance as regards DSME’s\nactual costs, but also that there was no causal link between the alleged subsidy granted to DSME and\nthe actual prices for the LNG carrier projects.\n\n (iv) With regard to paragraph 13 of the EC’s response:\n\n Please see “Response to Para. No. 13” in Exhibit Korea – 155.\n\n (v) With regard to paragraph 14 of the EC’s response\n\n Please see “Response to Para. Nos. 14 and 22” in Exhibit Korea – 155 for comment on\nparagraph 14.\n\n (vi) With regard to paragra phs 16 and 17 of the EC’s response:\n\n Please see “Response to Para. Nos. 16 and 17” in Exhibit Korea –155.\n\n (vii) With regard to paragra phs 17 to 21 of the EC’s response:\n\n Please see “Response to Para. Nos. 17 - 21” in Exhibit Korea– 155 for detailed comments on\nthese paragraphs.\n\n (viii) With regard to paragraph 22 of the EC’s response:\n\n Please see “Response to Pa ra. Nos. 14 and 22” in Exhibit Korea – 155 for comments on this\nparagraph.\n\n (ix) With regard to paragraph 23 of the EC’s response:\n\n Efficiency is achieved not only by investment in facilities, but also by the increase in the\nproductivity of the workforce, development of ef ficient management systems and other similar\nintangible improvements in the building process. Kor ean shipbuilders are known to be particularly\nefficient in terms of these latter factors. Shipyards which are efficient in this sense would have a low\nlevel of the “contract specific cost” which the EC includes in the category of “other direct costs.”\n\n Moreover, although it may be true that DS ME made some capital expenditures towards\nbuilding LNG carriers, DHI began to make such inv estments already in the early 1990’s. Therefore,\nFMI’s assumption that DSME made all of capital expenditures when it procured the LNG contracts in\n2000 is not correct. Furthermore, KP MG has confirmed that the actual cost of investment incurred by\nDSME was far lower than what has been assumed by FMI based on its experience with the European\nyards.\n\n In any event, as a matter of principle, it is in correct to attribute to Korean shipyards the costs\nof the European shipyards as was done by FMI since th e cost structure of Korean and EC shipyards is\ntotally different.\n\n (x) With regard to paragraph 24 of the EC’s response:\n\n Again, in this paragraph, the EC is trying to impose the European yards’ cost model upon\nDSME. There is no point in this line of argument in a situation where an independent accounting firm\nhas confirmed that the cost structure suggested by FMI based on the European model was totally\ndifferent from the actual cost structure of DSME.\n\n Contrary to the EC’s allegation, KPMG did no t say that these costs did not exist at all in\nDSME. In Exhibit Korea-108, KPMG indicated that the cost items mentioned by FMI (i.e., “cost of\ninvestment” and “contract specific costs”) were included in the DS ME’s cost items under different\naccount names (e.g., “repair expenses” and “depreciation” for “cost of investment”, “overhead costs”\nand “SG&A expenses” for “contract specific costs”). Please see section 2.5.3(3) b. and c. of KPMG’s\nCost Analysis Report (Exhibit Korea-108). In additi on, KPMG has confirmed that, in any event, the\namounts allocated by FMI to these costs were signi ficantly higher than the actual costs confirmed by\nKPMG from DSME’s accounts.\n\n (xi) With regard to paragraph 25 of the EC’s response:\n\n The EC presents no plausible basis to s upport its doubts regarding the accuracy of the\nordinary income margin as confirmed by KPMG. Howe ver, the ordinary income of DSME is a “fact”\nthat cannot be denied by a mere suspicion. From the viewpoint of inefficient European yards, it may\nlook unrealistic that the Korean yards are making such high profits. But it should be noted that the\noutstanding performance by the Korean LNG yards has been made possible by such a profitability.\n\n191. Exhibit KOR-107 sets forth the results of th e court-ordered/supervised restructuring of\nDaedong. Presumably, such a restructuring had to proceed in accordance with Korean\nbankruptcy law. On what basis does the EC allege that nevertheless it involved a subsidy?\n\nKorea’s comments\n\n The EC fails to acknowledge that the decisions to restructure a bankrupt company within the\nbankruptcy proceeding are made by the bankruptcy court, not by the creditors. Korea has\ndemonstrated that, although a creditor bank may participate in the bankruptcy proceeding as members\nof the interested parties’ meeting, it can neither take nor control the decision to restructure the\ncompany under the Korean law. In such a legal syst em, the EC fails to explain how the restructuring\ndecision made by the bankruptcy court can constitute a subsidization by a creditor.\n\n Moreover, the EC does not explain what “market” it refers to, when it says that a benefit may\nexist if the terms of the restructuring are more favourable than what would be obtained in the\n“market” even within a bankruptcy proceeding. In the court receivership proceeding, the restructuring\nhas to proceed in accordance with the bankruptcy law. The bankruptcy court initiates the proceeding\nand approves the restructuring plan only when the going concern value of the company has been\ndetermined to be greater than the liquidation valu e. Other than this, the Korean bankruptcy law does\nnot require the bankruptcy court to look into any “market” in approving the restructuring plan. Indeed,\nit does not make sense for the EC to suggest that a Korean bankruptcy court should try to find a\nbenchmark for a restructuring procedure of a partic ular corporation where such argument is unheard\nof for any bankruptcy proceeding in any jurisdiction. In fact, there is no “market” that the court can\nrefer to when it determines the restructuring plan, because the restructuring plan, in nature, has to be\ntailored to the specific situation of a particular bankrupt company.\n\n In any event, the EC has failed to prove that the terms of the restructuring of Samho and\nDaedong were more favourable than what would be obtained on the “m arket” (whatever that may be)\nwithin the specific bankruptcy proceeding for these companies.\n\nC. SERIOUS PREJUDICE\n\n192. One conclusion that might be drawn from Exhibits KOR-91-102 is that Korea accepts\nthat there is a benefit from the KEXIM financing at issue, but that the benefit in a number of\ncases is quite small (0.5 per cent or less). If on e accepts that the benefit is of the magnitude\nreflected in these Korean exhibits, what woul d be the implications for the EC’s serious\nprejudice analysis and conclusions?\n\nKorea’s comments\n\n At the outset, Korea notes that it was offering the referenced analysis in the alternative.\nKorea does not in any manner accept the EC’s premise that there was a benefit provided. In Korea’s\nview, the EC has utilized incorrect benchmarks a nd analytical approaches. However, Korea has\nendeavoured to show that, even using such fl awed data, the EC’s calculations result in a de minimis\nlevel of subsidization. It is in the nature of cases such as this where there are a great many issues\ndependent on previous affirmative findings by the Panel that, in the absence of knowing ahead of time\nwhether the Panel has made such affirmative findi ngs on specific issues, Korea has felt compelled to\nrespond to many EC allegations that Kor ea considers should be moot but cannot assume to be moot\nfor purposes of presenting its case. It is also in th e nature of such cases, that this arguing in the\nalternative is a burden that weighs particularly heavily on the respondent. Korea considers it very\nimportant that none of its arguments in the altern ative be taken to mean that it accepts the EC’s\narguments on prior elements of the case.\n\n Keeping the above-qualifications in mind, Korea notes that the EC continues to allege in its\nresponse that the KEXIM financing allows Korean shipyards “to offer a lower price than competing\nshipyards or to otherwise provide the most attract ive contract terms for the buyer” and would thus\n“significantly strengthen the ability of KEXIM-subsid ised shipyards to maintain their capacity (and\nthe low prices in the market) when they would otherwise exit the market or reduce capacity”.\n\n Korea notes that there is not even an attemp t on the part of the EC to adduce evidence in\nsupport of its response to the Panel’s question. Ne ither does the EC respond to Korea’s arguments in\nits comments to this Question as set forth in Korea’ s submission of 9 July. In short, for the Panel’s\nconvenience, these comments were the following:\n\n- the conditions at which KEXIM financing w as extended became more expensive as is\nrecognized by the EC – these more expensive conditions (i.e., no longer a “benefit”) cannot,\ntherefore have led to price suppression or depression;1\n\n- qualitative effects of an alleged subsidy only are insufficient when Article 6.3(c) of the SCM\nAgreement requires to demonstrate that the alleged subsidies have had a significant price\ndepressive or suppressive effect, thus requiring a quantification;\n\n- the very small benefit that the EC has been able to allege through the KEXIM financing is\ntotally out of proportion with the range of th e price depression and/or suppression margin that\nthe EC alleges – there is no significant price depression and/or suppression caused by the\nalleged KEXIM benefits, all the more since the EC recognizes a very substantial cost\nadvantage to the Korean shipyards vis-à-vis the EC shipyards;\n\n- the EC fails to demonstrate that the alleged subsidies as such (rather than the products) have\ncaused significant price depression and/or su ppression though this is required under\nArticle 6.3(c);\n\n- even if one were to consider the effect of the products rather than that of the subsidies, the EC\nmakes price depression and/or suppression alle gations for the Korean commercial vessels at\nlarge in spite of the fact that the evid ence demonstrates that KEXIM financing was not\ngranted for many of the vessels sold thereby di sproving that the financing kept in place\ncapacity that would otherwise have exited the market;\n\n - allegations in relation to price undercu tting that the EC itself abandoned cannot be\nreintroduced under the guise of establishing price depression/suppression;\n\n- EC subsidies of a substantia lly higher level are afforded to the EC shipyards overwhelming\nand displacing any effect of the alleged Kor ea subsidies - it would be impermissible to\nattribute to the Korean subsidies effects that were actually caused by the much larger EC\nsubsidies.\n\n193. Exhibit KOR-112, concerning MOCIE’s interv ention at the request of Samsung, could\nbe viewed as indicating that the government takes action if prices are too low. If this is the case,\nwhat are the implications for the EC’s serious prejudice claim?\n\nKorea’s comments\n\n Korea stands by its earlier explanation of MOCIE’s actions. Please refer to Korea’s comments\non this Panel Question, submitted on 9 July 2004.\n\n1 Korea would like to recall its overall arguments regarding evidence in the context of injury-type\ninvestigations, that it is necessarily the case that the most recent periods are the most relevant.\n\n However, it is with interest that Korea notes th e EC now is forced to deny the role for MOCIE\nthat the EC itself alleges. If the EC’s allegations regarding MOCIE were to be considered correct,\nthen the MOCIE intervention indeed does undercut th e EC’s serious prejudice claim. The EC cannot\nhave it both ways.\n\n194. If the Panel were to accept the product subdivisions set forth in Exhibit KOR-109, how\nwould this affect the EC’s analysis of price suppression/depression? Please respond in detail.\n\nKorea’s comments\n\n The EC’s answer has begged the Panel’s question. Instead of responding to the question, it\nattempts to make claims contradicting its former statements, hiding between a wall of generalization\nwhilst making disparaging remarks without purpose or s ubstance. Korea reads this lack of substantive\nresponse and mix of contradictory claims to demons trate that the EC does not wish to answer the\nPanel’s question because it will corroborate Korea’s approach and claims.\n\n (i) With regard to paragraph 30 of the EC’s response\n\n The EC now confirms that a larger ship costs more than a smaller ship and that economies of\nscale mean that parametric unit prices reduce as ships get bigger. This is precisely what Korea has\nbeen arguing: by amalgamating ships of different sizes, prices are taken into account that are not\ncomparable because they reflect sh ips that are widely different in size. This cannot yield an accurate\nportrayal of price trends. Whether for price undercutting, price depression or suppression, prices for\ndifferent sizes of ships are widely different and ca nnot be compared in order to derive an accurate\nprice trend.\n\n The EC further implies that work content is the only measure relating to shipbuilding whilst\ncargo-carrying parameters relate only to shipping . The shipbuilding market comprises suppliers and\ncustomers and the customers are shipowners who deal in cargo measures, hence cargo measures are\npart of the shipbuilding market, as well as the shipping market. Shipbuilding demand has to be\ncalculated from a basis of cargo measures because that is the demand driver which underpins the\nrequirement for ships (i.e, ships are required in order to carry cargo). Following the projection of\ndemand in cargo measures, because of the differing cargo measures used for different ships, cargo\nmeasures are converted into CGT, using assumptions on vessel size mix distributions. This is done to\nallow the aggregation across different ship typ es that is necessary to calculate total demand.\nShipbuilding capacity cannot be calculated separately by ship type\n2 and hence it is not possible to\nundertake supply-demand balance analysis at ship type level. Thus, the EC’s reliance on CGT is\ninconsistent with its own suggested three-way segmentation of the market.\n\n The EC’s view that price should be considered solely on a parametric basis of CGT would\nimply that price is considered only to be influe nced by the aggregate supply-demand balance or by\nsupply side work content criteria and that price will vary directly in relation to CGT for all sizes of\nvessels of a given ship type. Hence, the EC now seems effectively to be saying that material resources\nhave no impact on the ship prices\n3. This in turn would imply that the demand side criteria, such as the\nearnings capacity of the ship, have no influence at all on the investment price that an owner will\n\n 2 This inability to segment shipbuilding capacity by ship type is the non-homogeneity referred to by\nKorea in its response to Panel Question 125 which seems to have confused the EC in its ‘Comments on New\nFactual Information’, page 10 as submitted by the EC on 9 July 2004.\n3 It should be remembered of course that CGT in no way indicates the amount of material required to\nbuild the ship only the labour content. Hence, it take s no account of the different ec onomies of scale present in\nterms of material resources compared to labour resources for building ships of different sizes.\n\naccept. This, presumably, would imply, for example that the shipowner has no interest on the return\non their investment. It is clear that this is simply not the case.\n\n The weakness of the EC’s relia nce on CGT is further exposed when it is realised that ships\nare never segmented size wise on the basis of CGT. The onl y place that Korea has ever seen this is in\nthe EC’s own analysis and Annex V disclosures in respect of price undercutting, suppression and\ndepression. At no time has the EC put forward third party examples of the use of CGT for size\nsegmentation and this is because it is simply not used in the industry. If the EC accepts size\nsegmentation, it must accept this on the basis of cargo measures, which would question its absolute\ndependence on CGT as the basis for all its analysis.\n\n Korea has made it clear that it believes that pri ces in shipbuilding are influenced by a range of\nfactors. Examples of such factors have been referred to by the EC as well as Korea. OECD documents\nhave been submitted showing that OECD members cons ider that prices are influenced by a range of\nfactors even though there are differences of opinion on the full range of the factors concerned and the\nextent of correlation between these factors under di ffering market conditions. The EC cannot now be\narguing that only work content or macro-level supply-demand balance influence ship prices.\n\n In its simplest form, cost is generally c onsidered a supply-side factor whereas price is\nconsidered a demand side factor. It is hard, th erefore, to understand the logic which underpins the\nclaim that a price analysis should consider only one si de of the market and that this should be dictated\nby a supply-side measure such as CGT (which onl y sellers understand and use), rather than demand\nside measures such as cargo measures (which both buyers and sellers use and understand) and that\nfurthermore it is only the labour aspects of work c ontent that should be considered. Moreover, if, as it\nhas been alleged, the shipbuilding market is a buyer’s market, it then follows that demand side criteria\nare more likely to dominate.\n\n It is interesting to note that, Clarkson’s Ship yard Monitor (and its sister publication Shipping\nIntelligence Weekly), which the EC believes to be the leading source of industry data, compiles its\nnewbuilding index by averaging the US $/DWT acro ss a broad basket of ship types calculated from\nits price series for different ship types. Clarkson’s would therefore seem to feel that price per cargo\nunit (dwt being a cargo measure) is an important part of shipbuilding. This is confirmed in Clarkson’s\nSources and Methods statement (Page 4 last paragr aph under section on Newbuilding Contracts and\nPrices) which is provided in Exhibit Korea – 156\n\n (ii) With regard to paragraph 31 of the EC’s response\n\n The EC makes disparaging remarks about Korea’s understanding of the economics of\nshipbuilding prices, whereas it might be better serve d by reading what was actually written. All the\nwhile, the EC does not respond to the simple mathema tical fact noted by Korea: an average price for\nperiod A during which primarily large-size, low unit- priced ships are built cannot be compared to an\naverage price in the successive period B during wh ich primarily small-size, high unit-priced vessels\nwere built to determine whether price depression or suppression existed. This is inherent in the\nstatement made by the EC itself: large-size ships are sold at much higher prices than small-size ships.\n\n We note that the EC refers to weighting of prices according to product mix. Product mix is a\nterm that refers to types of ships and sizes of ve ssels, however in this instance, the graph only\nrepresents weighting by size and not type of vessels, and so the EC is referring only to one of the two\naspects of product mix. It is, however, worth noting, that the EC has in this fashion confirmed that\nboth size and type are important parts of shipbuildi ng product mix, but it is therefore all the more\ndifficult to understand their stance that ship size do es not count. The illustration in the graph referred\nto by the EC using weighted average pricing was used to demonstrate the distortion that can be\nproduced in simple average parametric prices (e.g., $/TEU) if no consideration is taken of the size mix\nof the demand over one period compared to the size mi x of another period. This relates to the fact\n\nthat there are different factors that do not work in unison for all ship sizes. This in turn relates to the\ncase put by Korea that ship size categories need to be taken into account as they represent different\nmarket factors because, for example:\n\n - Not all shipyards can build all sizes of ships;\n4\n\n - Ships of differing size are not used interchangeably;\n\n - Economies of scale exist in relation to bot h ship construction costs and ship operating\ncosts;\n\n - Prices vary differently for different types and sizes of ships;\n\n - Freight rates vary differently for different types and sizes of ships.\n\n The EC in its price analysis, invokes this sort of distortion when it uses parametric pricing\nwithout the use of size bands – a weighted average price at any given point of time when primarily\nlarge ships are built simply cannot be compared to a weighted average price in the next period when\nprimarily small ships are built.\n\n (iii) With regard to paragraph 32 of the EC’s response\n\n Yet again the EC contradicts itself regarding its reference to complex passenger vessels when\nits states that ‘cruise-ferries’ are being built in Korea and China when trying to rebut Korea’s\narguments against universal supply-side substitutab ility. In paragraph 158 of the EC’s response to\nPanel Question 165, the EC itself states “ or in the case of cruise ship operators who need vessels of\nsuch sophistication that Korean and Chinese yards are not considered experienced enough to deliver\nan acceptable ship.’ Now it seems when this argument does not suit them they refer to ‘cruise-\nferries’ being built in South Korea and China. Which of these conflicting statements does the EC wish\nthe Panel to believe? Further, Korea would like to point out that these ‘cruise-ferries’ are in fact\nferries not cruise ships, as the EC is now trying to imply, and small ones at that. The maximum size of\nsuch vessels:\n\n - in Korea being approximately 45,000 GT with a length of 210m\n\n - in China being approximately 30,000 GT with a length of 200m\n\nin contrast to the cruise ships of up to 148,000 GT with a length of up to 350m being built in the EC\ncruise shipbuilding yards. Cruise ships involve th e height of luxury and only carry passengers for\ndedicated leisure purposes. Ferries can carry people and/or vehicles and may be used for both leisure\nand/or commercial purposes. They do not involve the height of luxu ry and can range from very basic\ncross-river craft to higher technology sea-going vessels, however in no way do they approach the\ncomplexity of cruise ships. Trying to compare thes e vessels to each other and group them in to the\nsame complexity category is like trying to compar e a crop-spraying aeroplane with an executive Lear\njet aeroplane.\n\n To further demonstrate the inconsistency of th e EC, in paragraph 165 of the EC’s response to\nPanel Question 167, the EC refers quite clearly to ferries being built in Korea and refers of Korea’s\nintentions to ‘pursue the cruise ship sector’ recognising that it does not currently build such vessels. In\nno way are the terms ‘cruise ship’ and ‘ferry’ treated by the EC as being the same, but now suddenly,\nthese ferries are being described as ‘cruise-ferries’. The reality is that Korea builds some ferries but\ndoes not build cruise ships. China builds some ferries too but also does not build cruise ships. Japan\n\n4 Korea also submits that not all shipyards are credible builders of all types of ships.\n\ndelivered its first cruise ship in February this year (i.e. 2004). Cruise shipbuilding competence is\ncentred in EC yards despite th e EC attempts now to imply otherwise and to dismiss Korea’s\ncomments by misrepresentation.\n\n The EC refers to Exhibit EC-152 regarding the alleged diversity of the Korean shipyard\norderbooks but with its now familiar unspecified generalisations. Korea offers the following facts\nfrom the shipyard orderbook section of this Exhibit\n5:\n\n• Samho has 70 ships on order totalling 8.3m DWT of which 39 are container ships of 4,130\nTEU and above, 25 are tankers of 105,000 DWT and above (i.e. outside the size of the EC’s\nill-defined product/chemical category), 4 are bulk carriers of 170,00 DWT or above and 2 are\nLPG ships of 82,000 cbm. Only the container ships therefore overlap with the ship types\nunder review and these are all above 4,000 TEU and 75 per cent of them are above\n5,000 TEU.\n\n• Daewoo has 104 ships on order totalling 11.4 million DWT of which 34 are tankers of 69,000\n– 306,000 DWT. 19 are container ships of 4,000 TEU and above, 17 are LNG ships of\n138,000 cbm and above (three of which have regasification capability), 13 are pure car\ncarriers, 8 are bulk carriers of 75,000 – 174,000 DWT, 7 are LPG ships of 38 – 78,000 cbm, 6\nare products tankers of 49,000 – 105,000 DWT. There are also two non-ship offshore\nstructures on order.\n\n• STX has 95 vessels on order totalling 4.8m DWT of which 67 are products tankers of 29,000\n– 75,000 DWT, 18 are container ships of 2,500 – 3,500 TEU , 6 are bulk carriers of 75,500\nDWT, 2 are chemical/oil carriers of 38,000 DWT and 2 are LPG ships of 23,000 cbm.\n\n The EC claim seems therefore to have mixed typ es from various yards together to arrive at its\nlist.\n\n (iv) With regard to paragraph 33 of the EC’s response\n\n Both parties are now it seems in agreement th at ships are made-to-order products and that\nthere will inevitably be differences of specificatio n between such ships. However, it should be\nremembered that elsewhere in its arguments, the EC has looked at price undercutting allegations on a\nUS$/CGT price basis without any acknowledgement that specification differences may underpin price\ndifferences, as well as other factors. Once again it s position seems to change according to its current\nline of argument.\n\n The EC alleges that Korea has tried to a void SCM disciplines by creating unlimited numbers\nof categories of products. However Korea has, in fact, not only based its price analysis on basic ship\ntype and size band categories but has also demonstrated that there are other owner requirements which\ndifferentiate ships that may lie within the same si ze and type groupings. Such factors can significantly\nalter the cost of such vessels and th e price that an owner will be prep ared to pay. Far from tying to\navoid SCM disciplines, Korea has recognised that practical consideration must be given to the basis of\nanalysis\n6 in accordance with the strict provisions of the SCM Agreement and has, therefore,\nundertaken its price analysis on clearly defined size and type groupings.\n\n Korea considers that it is the EC that is trying to avoid the SCM disciplines by gross\ngeneralisation and its extraordinary claims that all ships of one basic type are interchangeable and are\nto be treated collectively irrespec tive of size. In its attempts at collectivisation, it has made some\n\n5 We have had to use Clarksons ship type categories for tankers, which include chemical/oil for ships\nwith some IMO class and products.\n6 Exhibit Korea – 70 page 5.21 and others.\n\nserious errors, for example, it firstly tried to cl aim that product and chemic al tankers are a single\nentity, it subsequently confirms that it is excl uding pure chemical carriers, it then uses sloppy and\ninaccurate data classifications that do not recogni se regulatory differences between chemical tankers\n(as reflected by IMO chemical cl asses) and now seeks to group toge ther some, still undefined, types\nof chemical tankers with pure products tankers, the latter of which are not allowed to carry chemicals\nat all.\n\n Korea has taken considerable care to clearly e xplain the differences that do exist, to explain\nthat there are inevitably grey areas\n7 of overlap but that size and type categorisation result in a more\npertinent analysis of the facts than the gross genera lisations that the EC puts forward. The fact that\nmuch of the expert analysis undertaken by FMI for the EC has also chosen to adopt broadly similar\nsize bands8 clearly demonstrates that size segmentation is normal but that there are variations on the\nbands used by various parties or for various purpo ses. This is not evidence to support the EC’s ‘no\nsize segmentation’ arguments. One must ask the ba sic question of why the EC and its advisors FMI\nhave ever made use of size bands if their assertion is that no size segregation is relevant rather than a\ndifference of view in respect of the actual bands used for analysis? The EC is therefore consistent only\nin its inconsistency – overlooki ng its own use of size bands when it sees advantage in\n‘collectivisation’.\n\n (v) With regard to paragraph 34 of the EC’s response\n\n Exhibit Korea - 109 was submitted to summa rise and present the case for like product\ndefinition and not to restate the analysis rebu tting alleged price suppression and depression which is\nreflected in the Drewry Report submitted as Exhi bit Korea - 70. The legal concept of like product\nrequires market categorisation which is driven by di fferences in technical characteristics as perceived\nby the user and reflected in end use. The disagre ement between the EC and Korea on the use of CGT\nvs DWT/TEU or other cargo measures lies at the h eart of this. The Panel recognises this, together\nwith size segmentation, in its question with its re ference to ‘product subdivisions’ but the EC has\nchosen to ignore this in its response.\n\n The EC refers to its Attachment 2 to the Response to Panel Questions following the first\nsubstantive meeting in respect of its price analysis. It is interesting to note that in the first paragraph of\nthis document the EC recognizes ship size in its statement ‘ and figure 1.2 shows how this order\nintake was distributed by size’. If size is not an issue in price suppression and depression, why is it the\nsecond factor highlighted in the FMI report?\n\n Korea has already highlighted in its comment s on the EC’s response with regard to Panel\nQuestion 162 submitted on 9 July 2004 that the gra ph submitted by EC on page 5 of Exhibit EC-146\ndoes not demonstrate ‘sub-classes of ships moving broadly in unison’ and that the small scale with\nwhich the EC has presented this graph has masked significant variations, which are clearly evident in\nthe numeric tabular format used by Korea to analy se the same Clarkson’s price series data. Korea has\nin no way been selective in doing this as it has used the example quoted by the EC and has analysed\nevery price series in that example and the result is evidence of significant price trend differences.\n\n Korea’s presentation of evidence in this fash ion also demonstrates the inaccuracy of FMI’s\ncomments regarding ‘strong correlation of price m ovements’ in its Attachment 2 document. Once\nagain, the EC has used small-scale graphical prese ntation to mask the significantly different price\nvariations that are evident from numerical presentatio n of price trends. For example Korea’s analysis\nhighlights that between the end of 1998 and 1999, VLCC tanker (300,000 DWT) prices dropped by\n5 per cent whereas Panamax (70,000 DWT) and Handy Tankers (47,000 DWT5) prices remained\nconstant. But by the end of 2000 VLCCs had rise n by another 11 per cent (cf end 1999) whereas\n\n7 Exhibit Korea – 109, page 1.\n8 As highlighted in Exhibit – Korea 109.\n\nAframax Tankers (110,000 DWT) had risen by 26 per cent, Panamax tankers by 16 per cent and\nHandy Tankers by 13 per cent. Prices do note even necessarily move in the same direction, for\nexample at end 2002 VLCC prices were 9 per cent lo wer than at end 2001 but Handy Tanker prices\nwere 3 per cent higher. This is not a pattern of ‘moving broadly in unison’ or ‘strong correlation’ as\nthe EC and its advisors claim.\n\n (vi) With regard to paragraph 35 of the EC’s response\n\n On the basis of the price change differentials demonstrated by Korea in its comments to the\nEC’s new factual information, the EC has no grounds for claiming that a more detailed analysis on the\nbasis of size segmentation would reveal the same me chanisms and would give the same results. The\nevidence provided by Korea is quite clear and th e EC has provided no substantiated evidence to\ncontradict it; its mere assertions to the contrary do not suffice.\n\n (vii) With regard to paragraph 36 of the EC’s response\n\n Korea has already explained\n9 that the use of orderbook as a measure of market presence is\nmisleading because of the varying time horizons of orderbooks between regions and individual yards.\nIt has also demonstrated that third party sources do not use orderbook in isola tion but also present the\nphasing of the orderbook.10\n\n Korea notes once again the lack of clarity a nd openness by the EC in not defining the size\nbands associated with its use of the terms ‘handy max, panamax and post-panamax’. The EC quotes\nhighly specific and emotive orderbook percentages but declines to clearly define the basis of these, so\nthat its statements cannot be counter ed to demonstrate its misleading u se of statistics. This is another\nexample of the EC trying to blur the argument through statistical imprecis ion and to hide behind\ngeneralisation.\n\n In addition, the EC continues to amalgamate r estructured and non-restructured yards alike and\nmakes assertions with reference to the Korean orderbook position desp ite the fact that unrestructured\nyards are significantly or even predominantly present in the orderbook position relied upon by the EC.\nAgain, the EC relies on the alleged effect of the Korean vessels while the Treaty requires it to show\nthe effect of the alleged Korean subsidies.\n\n195. Please comment on Exhibit KOR-115.\n\nKorea’s comments\n\n The EC in its response to the Panel’s question a lleges that the price levels indicated in Exhibit\nKorea - 115 “are the average of reported contract prices for the ship types in question for a seven-year\nperiod (1997-2003), adjusted by CGT. These averages are a very minor part of the FMI report and\nare meaningless without the time series graphs that accompany them”. The EC further asserts that the\n“graphs showing the relative movement of different nationalities are of particular importance”.\n\n In fact, the graphs with the lines shown for di fferent countries in the FMI report supplied as\nExhibit Korea – 142 ( see Figures 2.3, 2.8, 2.12, 2.18, 3.6 and 3.11) are simply inaccurate and\nmisleading because of the following errors:\n\n• These graphs are prepared from the 'spot graphs' offered for each country ( see Figures 2.1,\n2.2, 2.4, 2.5, 2.6, 2.7, 2.9, 2.10, 2.11, 2.13, 2.14, 2.15, 2.16, 2.17, 3.1, 3.2, 3.3, 3.4, 3.5, 3.7,\n3.8, 3.9, 3.10). Nevertheless, these spot graphs reflect many half year points for which there\n\n9 Korea’s response to Panel Question 174.\n10 Korea’s response to Panel Question 174.\n\nare no spots, presumably because there were no c ontracts or because there was no price data\navailable.\n\n• The error occurs when these spot graphs are tr anslated into line graphs because they have\nsimply joined the available dots, without any recognition of the fact that some times there was\nno data. This results in lines which may show as higher than Korea at a time when there is in\nfact no data.\n\n• For example, in Figure 2.18 Korea, is shown as having lower prices (albeit marginally) than\nChina over the period 1\nst half of 1998 to 2nd half of 1999. However, in fact, there were no data\npoints for Korea on the spot graph in Figure 2.18 for the 1 st and 2nd halves of 1998 and the 1 st\nhalf of 1999 and there were different missing points for China in the spot graph in Figure\n2.13. Absent any pricing data for Korea, the gr aph is wrong in implying that the prices for\nKorean vessels could have caused price depressi on or suppression. The time graphs shown in\nthe FMI report are, therefore, inaccurate and misleading. In fact, the EC and FMI are over-\nsimplifying the price setting for vessels and not Korea as the EC has stated.\n\n The proper fashion to plot the spot graphs on a time series graph is to plot these as spot and\npartial line graphs. To demonstrate the profound difference that correct plotting makes, Korea\npresents one of these graphs, firstly as plotted by FMI in their document and secondly as replotted by\nKorea recognizing the absent data points. Exhibit Korea – 157\n shows all of the graphs replotted and\nhighlights the erroneous commentary arising from the original graphs.\n\nFig 2.8 Replotted by Korea\nHandymax product tankers\n800\n1,000\n1,200\n1,400\n1,600\n1,800\n97/\n1H\n97/\n2H\n98/1H98/2H99/1H99/2H00/1H00/2H01/1H\n01/\n2H\n02/\n1H\n02/\n2H\n03/\n1H\n03/\n2H\n$ per CGT\nChina Japan Korea Other\n\n• It remains that FMI itself has supplied in Tables 2.1, 2.2, 2.3, 2.4, 3.1, 3.2 and 3.3 average\nprices for different like product vessels for China, Korea, Japan, the EC and other\nshipbuilding countries for the period 1997 to 2003 and that the EC has submitted this data in\nthe Annex V process. These prices must have a meaning or they would not have been\nincluded in an FMI report. They cannot be discarded as setting forth a minor part of the\nreport. As the EC itself states, long-term pric e averages are meaningful for a trend analysis\nbut the assessment on the existence of price depr ession or suppression is precisely an analysis\nof trends.\n\n Korea further notes that the quotations cited to in the EC’s response to the Panel’s questions\nsupport rather than contradict what Korea has been stating all along, i.e., that the EC considers the\nalleged impact of Korean vessels, rather than the im pact of the alleged Korean subsidies. In addition,\neven if the impact of Korean vessels is cons idered without considering whether these vessels\nbenefited from the alleged subsidies (indeed, the EC considers sweeps all Korean vessels into its\nproduct depression and suppression allega tions), the EC evidence itself fails to indicate that price\ndepression or suppression were caused by the Korean vessels and a fortiori by the alleged subsides\nthemselves. Reference is made by way of example to the following statements made by FMI:\n\n - China appears to be the price leader for panamax tankers;\n\n - Chemical tanker prices have been led by China since 2001;\n\n - In the feeder container sector, prices appear to have been led in recent years by South\nKorea and China but with strong competition from Poland, Singapore and Taiwan;\n\n - Handysize product tankers: China and South Korea, with South Korea dominating\n(note: but no sales or prices were plotted for the EC without any explanation),\n\n - Panamax product tankers: China has remained the price leader in this sector over the\nperiod examined;\n\n - Chemical tankers: Japan, South Korea and China have offered the lowest prices and\nin the past two years China appears to have been the price leader.\n\n Korea notes that, contrary to the EC insinuations , it does not agree to the use of CGT for the\npurpose of measuring any capability to depress or s uppress prices. Nevertheless, the EC itself relies\n\non this standard of measurement and its data conf irms that Korean prices were not as a rule below\nthose of EC vessels such as to cause price depression or suppression.\n\n In respect of the EC’s comment in paragra ph 37, Korea notes that it has simply used the\ninformation that the EC has presented in its own case, and this does not in any way imply that Korea\nbelieves $/CGT to be the most appropriate measure for parametric pricing. Korea provides this as an\nargument in the alternative. Korea retains its view as expressed in Exhibit Korea – 70 that parametric\npricing should be based on cargo measures such as dwt, teu and cbm. Korea has reiterated its\npreviously stated reservations regarding the use of $/CGT in its comments pertaining to Question 194\nin this document. Furthermore Korea reminds the Panel that CGT only reflects the labour work\ncontent of supply costs not the material content.\n\n Korea stands by its own price analysis in Exhibit Korea – 70 which found no evidence of\nprice depression or suppression in the market under review.\n\nList of Exhibits\n\nExhibit Korea – 154 Question 188 – Anjin’s third response dated 23 July 2004\n\nExhibit Korea – 155 Question 190 - Supplemental response by KPMG\n\nExhibit Korea – 156 Question 194 - Clarkson’s Sources and Methods statement (excerpt)\n\nExhibit Korea – 157 Question 195 – Detailed comments on the FMI report in Exhibit\nKorea – 142\n\nNote\n: The exhibits shown in bold contain Business Confidential Information."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:55.939016"}}},{"rowIdx":4082,"cells":{"folder_number":{"kind":"string","value":"274"},"case_number":{"kind":"string","value":"274"},"original_filename":{"kind":"string","value":"DS274_SEQ01_Request_For_Consultations_01.pdf"},"new_filename":{"kind":"string","value":"DS274_SEQ01_Request_For_Consultations_01.pdf"},"doc_sequence":{"kind":"number","value":1,"string":"1"},"doc_type":{"kind":"string","value":"Request_For_Consultations"},"doc_type_raw":{"kind":"string","value":"Request for Consultations by Chinese Taipei"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":1,"string":"1"},"case_title":{"kind":"string","value":"UNITED STATES – DEFINITIVE SAFEGUARD MEASURES ON IMPORTS OF CERTAIN STEEL PRODUCTS"},"date":{"kind":"string","value":"11 November 2002"},"header_codes":{"kind":"string","value":"WT/DS274/1; G/L/584; G/SG/D29/1"},"agreement_indicators":{"kind":"string","value":"General Council; Safeguards (SG)"},"complainant":{"kind":"string","value":"['Taiwan']"},"respondent":{"kind":"string","value":"['U.S.']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. I:1, XIX:1 GATT 1994Art. 2, 2.1, 2.2, 3.1, 4.1, 4.2, 5.1 Safeguards"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by Chinese Taipei.\nOn 1 November 2002, Chinese Taipei requested\n consultations with the United States with regard to safeguard measures on\n steel imposed by the United States on imports of certain steel products.\n These measures are currently been reviewed by a Panel in the joint cases\n WT/DS248, WT/DS249, WT/DS251, WT/DS252, WT/DS253, WT/DS254, WT/DS258,\n WT/DS259. Chinese Taipei is a third party in these proceedings.\nThis dispute concerns the definitive safeguard measures\n imposed by the United States in the form of an increase in duties on\n imports of certain flat steel, hot-rolled bar, cold-finished bar, rebar,\n certain tubular products, carbon and alloy fittings and flanges, stainless\n steel bar, stainless steel rod, tin mill products and stainless steel\n wire, and in the form of a tariff rate quota on imports of slabs. These\n measures were published in the Proclamation 7529, dated 5 March 2002\n (Federal Register Vol. 67, No 45 of 7 March 2002). Chinese Taipei\n considers that these measures are in violation of the United States\n obligations under Articles I:1 and XIX:1(a) of the GATT 1994 and Articles\n 2.1, 2.2, 3.1, 4.1(c), 4.2(a), 4.2(b) and 5.1 of the Agreement on\n Safeguards.\nOn 21 November 2002, Japan requested to join the\n consultations. The United States informed that DSB that it accepted the\n request of Japan to join the consultations."},"page_count":{"kind":"number","value":2,"string":"2"},"clean_text":{"kind":"string","value":"UNITED STATES – DEFINITIVE SAFEGUARD MEASURES\nON IMPORTS OF CERTAIN STEEL PRODUCTS\nRequest for Consultations by Chinese Taipei\nThe following communication, dated 1 November 2002, from the Permanent Representative\nof the Separate Customs Territory of Taiwan, Pe nghu, Kinmen and Matsu to the Permanent Mission\nof the United States and to the Chairman of the Dispute Settlement Body, is circulated in accordance\nwith Article 4.4 of the DSU.\nMy government has instructed me to request consultations with the Government of the\nUnited States, pursuant to Article 4 of the Understanding on Rules and Procedures Governing the\nSettlement of Disputes (DSU), Article XXII:1 of the General Agreement on Tariffs and Trade 1994\n(GATT 1994) and Article 14 of the Agreement on Safeguards, with regard to the definitive safeguard\nmeasures imposed by the United States on imports of certain steel products.\nUnder \"Proclamation No. 7529 of 5 March 2002 – To Facilitate Positive Adjustment to\nCompetition from Imports of Certain Steel Products\" and \"Memorandum of 5 March 2002 – Action\nUnder Section 203 of the Trade Act of 1974 Concerning Certain Steel Products by the President of the\nUS\" published in Vol.67, No.45 of the Federal Register on 7 March 2002, the United States imposed\ndefinitive safeguard measures in the form of an increase in duties on imports of certain flat steel,\nhot-rolled bar, cold-finished bar, rebar, certain tubular products, carbon and alloy fittings and flanges,\nstainless steel bar, stainless steel rod, tin mill products and stainless steel wire, and in the form of a\ntariff rate quota on imports of slabs.\nThe Government of the separate customs territory of Taiwan, Penghu, Kinmen and Matsu\nconsiders that those US measures are in violation of the US obligations under the provisions of the\nGATT 1994 and of the Agreement on Safeguards. Our concerns include, in particular, but not\nnecessarily exclusively, the following:\n– The US failed to demonstrate, before applying the safeguard measures, the logical connection\nbetween the \"conditions\" identified in the second clause of Article XIX:1(a) of GATT 1994\nand the \"circumstances\" outlined in the first clause of that provision. The application of the\nsafeguard measures is, inter alia, in violation of Article XIX:1(a) of GATT 1994.\n– There were no increased imports for many of the imported products under the investigation.\nThe application of the safeguard measures is, inter alia , in violation of XIX:1(a) of\nGATT 1994, Article 2.1, 4.2(a) and 4.2(b) of the Agreement on Safeguards.\n– The US failed to identify the producers of the like products in order to define the domestic\nindustry and failed to publish its finding in this regard. The application of the safeguard\n\nmeasures is, inter alia , in violation of Articles 2, 3.1 and 4.1(c) of the Agreement on\nSafeguards.\n– The US failed to demonstrate the existence of the requisite causal link between the alleged\nincreased imports and the alleged serious injury or threat thereof. The application of the\nsafeguard measures is, inter alia, in violation of Article XIX:1(a) of GATT 1994, Articles 2.1\nand 4.2(b) of the Agreement on Safeguards.\n– The US failed to ensure that she did separate and distinguish the injurious effects of other\ncauses from increased imports. The application of the safeguard measures is, inter alia, in\nviolation of Articles 4.2(b) of the Agreement on Safeguards.\n– The US failed to demonstrate that the safeguard measures are applied to the extent necessary\nto prevent or remedy serious injury. The application of the safeguard measures is, inter alia,\nin violation of Article 5.1 of the Agreement on Safeguards.\n– The US failed to apply her safeguard measures to imported products irrespective of their\nsources. The application of the safeguard measures is, inter alia, in violation of Article I:1 of\nGATT 1994 and Article 2.2 of the Agreement on Safeguards.\nThe Government of the separate customs territory of Taiwan, Penghu, Kinmen and Matsu\nreserves its right to raise further factual and legal issues during the course of consultations and\nsubsequent dispute settlement proceedings.\nWe look forward to receiving your reply to this request so we may proceed to arrange a\nmutually convenient date and place to begin consultations."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:55.966055"}}},{"rowIdx":4083,"cells":{"folder_number":{"kind":"string","value":"274"},"case_number":{"kind":"string","value":"274"},"original_filename":{"kind":"string","value":"DS274_SEQ02_Request_To_Join_Consultations_00.pdf"},"new_filename":{"kind":"string","value":"DS274_SEQ02_Request_To_Join_Consultations_00.pdf"},"doc_sequence":{"kind":"number","value":2,"string":"2"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from Japan"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":0,"string":"0"},"case_title":{"kind":"string","value":"UNITED STATES – DEFINITIVE SAFEGUARD MEASURES ON IMPORTS OF CERTAIN STEEL PRODUCTS"},"date":{"kind":"string","value":"25 November 2002"},"header_codes":{"kind":"string","value":"WT/DS274/2"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['Taiwan']"},"respondent":{"kind":"string","value":"['U.S.']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. I:1, XIX:1 GATT 1994Art. 2, 2.1, 2.2, 3.1, 4.1, 4.2, 5.1 Safeguards"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by Chinese Taipei.\nOn 1 November 2002, Chinese Taipei requested\n consultations with the United States with regard to safeguard measures on\n steel imposed by the United States on imports of certain steel products.\n These measures are currently been reviewed by a Panel in the joint cases\n WT/DS248, WT/DS249, WT/DS251, WT/DS252, WT/DS253, WT/DS254, WT/DS258,\n WT/DS259. Chinese Taipei is a third party in these proceedings.\nThis dispute concerns the definitive safeguard measures\n imposed by the United States in the form of an increase in duties on\n imports of certain flat steel, hot-rolled bar, cold-finished bar, rebar,\n certain tubular products, carbon and alloy fittings and flanges, stainless\n steel bar, stainless steel rod, tin mill products and stainless steel\n wire, and in the form of a tariff rate quota on imports of slabs. These\n measures were published in the Proclamation 7529, dated 5 March 2002\n (Federal Register Vol. 67, No 45 of 7 March 2002). Chinese Taipei\n considers that these measures are in violation of the United States\n obligations under Articles I:1 and XIX:1(a) of the GATT 1994 and Articles\n 2.1, 2.2, 3.1, 4.1(c), 4.2(a), 4.2(b) and 5.1 of the Agreement on\n Safeguards.\nOn 21 November 2002, Japan requested to join the\n consultations. The United States informed that DSB that it accepted the\n request of Japan to join the consultations."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"UNITED STATES – DEFINITIVE SAFEGUARD MEASURES\nON IMPORTS OF CERTAIN STEEL PRODUCTS\nRequest to Join Consultations\nCommunication from Japan\nThe following communication, dated 21 November 2002, from the Permanent Mission of\nJapan to the Permanent Mission of the United States, the Permanent Representative of the Separate\nCustoms Territory of Taiwan, Penghu, Kinmen a nd Matsu, and to the Chairman of the Dispute\nSettlement Body, is circulated in accordance with Article 4.11of the DSU.\nPursuant to paragraph 11 of Article 4 of the Understanding on Rules and Procedures\nGoverning the Settlement of Disputes (DSU), the Government of Japan hereby notifies the\nGovernment of the United States that, in light of the substantial trade interest of Japan, it desires to be\njoined in the consultations requested by the Separate Customs Territory of Taiwan, Penghu, Kinmen\nand Matsu in a communication circulated to WTO Members on 11 November 2002 (,\n, ) titled \" \".\nAs a major exporter of steel products to the United States, Japan has a substantial trade\ninterest in this case."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:55.966457"}}},{"rowIdx":4084,"cells":{"folder_number":{"kind":"string","value":"274"},"case_number":{"kind":"string","value":"274"},"original_filename":{"kind":"string","value":"DS274_SEQ03_Request_To_Join_Consultations_01.pdf"},"new_filename":{"kind":"string","value":"DS274_SEQ03_Request_To_Join_Consultations_01.pdf"},"doc_sequence":{"kind":"number","value":3,"string":"3"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Acceptance by the United States of the Request to Join Consultations Japan notified the Dispute Settlement Body (D SB) of its desire to be joined in the consultations requested by Chinese Taipei, pursuant to Article 4.11 of the DSU. The Permanent Mission of the United States informed the DSB that it had accepted the request of Japan to join the consultations. ÉTATS-UNIS - MESURES DE SAUVEGARDE DÉFINITIVES À L'IMPORTATION DE CERTAINS PRODUITS EN ACIER Acceptation par les États-Unis de la demande de participation aux consultations Le Japon a fait savoir à l'Organe de règlement des différends (ORD) qu'il désirait participer aux consultations demandées par le Taipei chinois, conformément à l'article 4:11 du Mémorandum d'accord sur le règlement des différends. La Mission permanente des États-Unis a informé l'ORD qu'elle avait accepté la demande de participation aux consultations présentée par le Japon. ESTADOS UNIDOS - MEDIDAS DE SALVAGUARDIA DEFINITIVAS"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":1,"string":"1"},"case_title":{"kind":"string","value":"UNITED STATES – DEFINITIVE SAFEGUARD MEASURES ON IMPORTS OF CERTAIN STEEL PRODUCTS"},"date":{"kind":"string","value":"16 December 2002"},"header_codes":{"kind":"string","value":"WT/DS274/3"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['Taiwan']"},"respondent":{"kind":"string","value":"['U.S.']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. I:1, XIX:1 GATT 1994Art. 2, 2.1, 2.2, 3.1, 4.1, 4.2, 5.1 Safeguards"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by Chinese Taipei.\nOn 1 November 2002, Chinese Taipei requested\n consultations with the United States with regard to safeguard measures on\n steel imposed by the United States on imports of certain steel products.\n These measures are currently been reviewed by a Panel in the joint cases\n WT/DS248, WT/DS249, WT/DS251, WT/DS252, WT/DS253, WT/DS254, WT/DS258,\n WT/DS259. Chinese Taipei is a third party in these proceedings.\nThis dispute concerns the definitive safeguard measures\n imposed by the United States in the form of an increase in duties on\n imports of certain flat steel, hot-rolled bar, cold-finished bar, rebar,\n certain tubular products, carbon and alloy fittings and flanges, stainless\n steel bar, stainless steel rod, tin mill products and stainless steel\n wire, and in the form of a tariff rate quota on imports of slabs. These\n measures were published in the Proclamation 7529, dated 5 March 2002\n (Federal Register Vol. 67, No 45 of 7 March 2002). Chinese Taipei\n considers that these measures are in violation of the United States\n obligations under Articles I:1 and XIX:1(a) of the GATT 1994 and Articles\n 2.1, 2.2, 3.1, 4.1(c), 4.2(a), 4.2(b) and 5.1 of the Agreement on\n Safeguards.\nOn 21 November 2002, Japan requested to join the\n consultations. The United States informed that DSB that it accepted the\n request of Japan to join the consultations."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"UNITED STATES – DEFINITIVE SAFEGUARD MEASURES\nON IMPORTS OF CERTAIN STEEL PRODUCTS\nAcceptance by the United States of the Request to Join Consultations\nJapan notified the Dispute Settlement Body (D SB) of its desire to be joined in the\nconsultations requested by Chinese Taipei, pursuant to Article 4.11 of the DSU.\nThe Permanent Mission of the United States informed the DSB that it had accepted the\nrequest of Japan to join the consultations.\nÉTATS-UNIS - MESURES DE SAUVEGARDE DÉFINITIVES À\nL'IMPORTATION DE CERTAINS PRODUITS EN ACIER\nde participation aux consultations\nLe Japon a fait savoir à l'Organe de règlement des différends (ORD) qu'il désirait participer\nESTADOS UNIDOS - MEDIDAS DE SALVAGUARDIA DEFINITIVAS\nPRODUCTOS DE ACERO\nEl Japón notificó al Órgano de Solución de Diferencias (OSD) su deseo de que se le asociara\ndel ESD."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:55.966941"}}},{"rowIdx":4085,"cells":{"folder_number":{"kind":"string","value":"275"},"case_number":{"kind":"string","value":"275"},"original_filename":{"kind":"string","value":"DS275_SEQ01_Request_For_Consultations.pdf"},"new_filename":{"kind":"string","value":"DS275_SEQ01_Request_For_Consultations.pdf"},"doc_sequence":{"kind":"number","value":1,"string":"1"},"doc_type":{"kind":"string","value":"Request_For_Consultations"},"doc_type_raw":{"kind":"string","value":"Request for Consultations by the United States"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"null"},"case_title":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS"},"date":{"kind":"string","value":"12 November 2002"},"header_codes":{"kind":"string","value":"WT/DS275/1; G/L/587; G/LIC/D/35; G/AG/GEN/55; G/TRIMS/D/19"},"agreement_indicators":{"kind":"string","value":"Agriculture (AG); General Council; Import Licensing (LIC); Trade-Related Investment Measures (TRIMS)"},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Venezuela']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by the United States.\nOn 7 November 2002 the United States requested\n consultations with Venezuela concerning Venezuelan import licensing\n systems and practices that restrict agricultural imports from the United\n States. According to the United States, Venezuela has established import\n licensing requirements for numerous agricultural products, including corn,\n sorghum, dairy products (for example, cheese, whey, whole milk powder, and\n non-fat dry milk), grapes, yellow grease, poultry, beef, pork, and soybean\n meal.\nThe United States claimed that Venezuela appears to\n have established a discretionary import licensing regime for the above\n products. It further claimed that, through its import licensing practices,\n Venezuela has failed to establish a transparent and predictable system for\n issuing import licenses and has severely restricted and distorted trade in\n these goods.\nThe United States alleges that Venezuela’s import\n licensing systems and practices appear to be inconsistent with Article 4.2\n of the Agreement on Agriculture; Articles III, X, XI, and XIII of GATT\n 1994; Article 2.1 of the TRIMs Agreement, and Articles 1.4, 3.2, 3.5, 5.1,\n 5.2, and 5.3 of the Import Licensing Agreement. Venezuela’s measures also\n appear to nullify or impair the benefits accruing to the United States\n directly or indirectly under the cited agreements.\nOn 20 November 2002, the EC and Canada requested to\n join the consultations. On 21 November 2002, New Zealand and Chile\n requested to join the consultations. On 22 November 2002, Argentina and\n Colombia requested to join the consultations. On 25 November 2002,\n Venezuela informed the DSB that it had accepted the requests of Argentina,\n Canada, Chile, the EC and New Zealand to join the consultations."},"page_count":{"kind":"number","value":3,"string":"3"},"clean_text":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON\nCERTAIN AGRICULTURAL PRODUCTS\nRequest for Consultations by the United States\nThe following communication, dated 7 November 2002, from the Permanent Mission of the\nUnited States to the Permanent Mission of Venezuela and to the Chairman of the Dispute Settlement\nBody, is circulated in accordance with Article 4.4 of the DSU.\nMy authorities have instructed me to request consultations with the Government of Venezuela\npursuant to Articles 1 and 4 of the Understanding on Rules and Procedures Governing the Settlement\nof Disputes (DSU), Article XXII of the General Agreement on Tariffs and Trade 1994 (GATT 1994),\nArticle 6 of the Agreement on Import Licensing Procedures (Import Licensing Agreement), Article 19\nof the Agreement on Agriculture , and Article 8 of the Agreement on Trade-Related Investment\nMeasures (TRIMs Agreement), with respect to Venezuelan import licensing systems and practices\nthat restrict agricultural imports from the United States.\nVenezuela has established import licensing requirements for numerous agricultural products,\nincluding corn, sorghum, dairy products (for example, cheese, whey, whole milk powder, and non-fat\ndry milk), grapes, yellow grease, poultry, beef, pork, and soybean meal. Thus, to import any of these\nproducts, an importer must obtain a license in accordance with Venezuelan procedures. Venezuela\nmaintains these import licensing systems and practices through numerous measures, including:\nfor yellow corn and sorghum,\n• Ministerio de Hacienda DM/ No. 3299, Ministerio de Industria y Comercio DM/\nNo. 036 & Ministerio de Agricultura y Cria DM/ No. 038, Gaceta Oficial de la\nRepública de Venezuela No. 36,142 (6 February 1997);\n• Ministerio de Hacienda DM/ No. 4315, Ministerio de Industria y Comercio DM/\nNo. 569 & Ministerio de Agricultura y Cria DM/ No. 703, Gaceta Oficial No. 36,620\n(13 January 1999);\n• Ministerio de Finanzas DM/ No. 284 & Ministerio de la Producción y el Comercio\nDM/ No. 628, Gaceta Oficial No. 36,831 (17 November 1999);\n• Ministerio de la Producción y el Comercio, Aviso Oficial: Mecanísmo de\nComercialización de Cereales (18 September 2001);\n• Ministerio de la Producción y el Comercio, Aviso Oficial: Mecanísmo de\nComercialización de Cereales (11 October 2001);\n• Ministerio de Finanzas DM/ No. 868 & Ministerio de la Producción y el Comercio\nDM/ No. 0002, Gaceta Oficial No. 37,368 (21 January 2002);\nWT/DS275/1, G/L/587,\nG/LIC/D/35, G/AG/GEN/55,\n\n• Ministerio de Finanzas Resolución No. 911, Gaceta Oficial No. 5,581 Extraordinaria\n(27 March 2002);\n• and related resolutions, decrees, official notices, and amendments;\nfor dairy products (for example, cheese, whey, whole milk powder, and non-fat dry milk),\n• Ministerio de Hacienda No. 3677, Ministerio de Industria y Comercio No. 232 &\nMinisterio de Agricultura y Cria No. 298, Gaceta Oficial No. 36,311\n(13 October 1999);\n• Ministerio de Finanzas DM/ No. 285 & Ministerio de la Producción y el Comercio\nDM/ No. 631, Gaceta Oficial No. 36,831 (17 November 1999);\n• Ministerio de Finanzas Resolución No. 294, Gaceta Oficial No. 36,850\n(14 December 1999);\n• Ministerio de Finanzas DM/ No. 848 & Ministerio de la Producción y el Comercio\nDM/ No. 898, Gaceta Oficial No. 37,329 (21 November 2001);\n• and related resolutions, decrees, official notices, and amendments; and\nfor yellow grease and soybean meal,\n• Ministerio de Finanzas DM/ No. 282 & Ministerio de la Producción y el Comercio\nDM/ No. 627, Gaceta Oficial No. 36,831 (17 November 1999);\n• Ministerio de Finanzas Resolución No. 295, Gaceta Oficial No. 36,850\n(14 December 1999);\n• Ministerio de Finanzas DM/ No. 850 & Ministerio de la Producción y el Comercio\nDM/ No. 918, Gaceta Oficial No. 37,329 (21 November 2001);\n• and related resolutions, decrees, official notices, and amendments.\nVenezuela requires import licenses for other agricultural products, including poultry, beef,\npork, and grapes (Decreto No. 989, Gaceta Oficial No. 5,039 Extraordinaria (9 February 1996)), but\ndoes not appear to have published any resolutions, decrees, official notices, or any other measures\nestablishing applicable import licensing procedures.\nVenezuela's import licensing system for all of these agricultural products appears to establish\na discretionary import licensing regime. Through its import licensing practices, Venezuela has also\nfailed to establish a transparent and predictable system for issuing import licenses and has severely\nrestricted and distorted trade in these goods. Such practices include Venezuela's failure to publish\nrules and information concerning its licensing procedures, its failure to process applications in a\ntimely fashion, its failure to make licenses valid for a period of reasonable duration, and its\nadministration of tariff-rate quotas so as to discourage their full utilization. In addition, in several\ncases Venezuela has tied the issuance of licenses to the purchase, consumption, or use of domestic\nproducts or investment in domestic production. At least twice Venezuela has explicitly banned the\nimportation of corn by suspending the granting of import licenses until domestic production has been\nremoved from the market.\nVenezuela's import licensing systems and practices thus appear to be inconsistent with\nnumerous WTO obligations. Specifically, Venezuela's measures appear inconsistent with Article 4.2\nof the Agreement on Agriculture , Articles III, X, XI, and XIII of GATT 1994, Article 2.1 of the\nTRIMs Agreement, and Articles 1.4, 3.2, 3.5, 5.1, 5.2, and 5.3 of the Import Licensing Agreement.\nVenezuela's measures also appear to nullify or impair the benefits accruing to the United States\ndirectly or indirectly under the cited agreements.\nWT/DS275/1, G/L/587,\nG/LIC/D/35, G/AG/GEN/55,\n\nMadam Ambassador, we urge Venezuela to take this request for consultations as an opportunity\nto bring its import regime for agricultural products into compliance with Venezuela's WTO\ncommitments. We look forward to receiving your reply to the present request and to fixing a\nmutually convenient date for consultations."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:56.034960"}}},{"rowIdx":4086,"cells":{"folder_number":{"kind":"string","value":"275"},"case_number":{"kind":"string","value":"275"},"original_filename":{"kind":"string","value":"DS275_SEQ02_Request_To_Join_Consultations_00.pdf"},"new_filename":{"kind":"string","value":"DS275_SEQ02_Request_To_Join_Consultations_00.pdf"},"doc_sequence":{"kind":"number","value":2,"string":"2"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from the European Communities"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":0,"string":"0"},"case_title":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS"},"date":{"kind":"string","value":"22 November 2002"},"header_codes":{"kind":"string","value":"WT/DS275/2"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Venezuela']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by the United States.\nOn 7 November 2002 the United States requested\n consultations with Venezuela concerning Venezuelan import licensing\n systems and practices that restrict agricultural imports from the United\n States. According to the United States, Venezuela has established import\n licensing requirements for numerous agricultural products, including corn,\n sorghum, dairy products (for example, cheese, whey, whole milk powder, and\n non-fat dry milk), grapes, yellow grease, poultry, beef, pork, and soybean\n meal.\nThe United States claimed that Venezuela appears to\n have established a discretionary import licensing regime for the above\n products. It further claimed that, through its import licensing practices,\n Venezuela has failed to establish a transparent and predictable system for\n issuing import licenses and has severely restricted and distorted trade in\n these goods.\nThe United States alleges that Venezuela’s import\n licensing systems and practices appear to be inconsistent with Article 4.2\n of the Agreement on Agriculture; Articles III, X, XI, and XIII of GATT\n 1994; Article 2.1 of the TRIMs Agreement, and Articles 1.4, 3.2, 3.5, 5.1,\n 5.2, and 5.3 of the Import Licensing Agreement. Venezuela’s measures also\n appear to nullify or impair the benefits accruing to the United States\n directly or indirectly under the cited agreements.\nOn 20 November 2002, the EC and Canada requested to\n join the consultations. On 21 November 2002, New Zealand and Chile\n requested to join the consultations. On 22 November 2002, Argentina and\n Colombia requested to join the consultations. On 25 November 2002,\n Venezuela informed the DSB that it had accepted the requests of Argentina,\n Canada, Chile, the EC and New Zealand to join the consultations."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON\nCERTAIN AGRICULTURAL PRODUCTS\nRequest to Join Consultations\nCommunication from the European Communities\nThe following communication, dated 20 November 2002, from the Permanent Delegation of\nthe European Commission to the Permanent Mission of Venezuela, the Permanent Mission of the\nUnited States and to the Chairman of the Dispute Settlement Body, is circulated in accordance with\nArticle 4.11of the DSU.\nWe refer to the communication from the Permanent Mission of the United States addressed to\nthe Permanent Mission of Venezuela and to the Chairman of the Dispute Settlement Body entitled\n\"\" (WT/DS275) and which\nwas circulated on 12 November 2002 in accordance with Article 4.4 of the DSU as document\n, , , and\nThe communication refers to consultations being sought with Venezuela pursuant to Article 4\nof the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU),\nArticle XXII of the General Agreement on Tariffs and Trade 1994 (GATT 1994), Article 6 of the\nAgreement on Import Licensing Procedures (Im port Licensing Agreement), Article 19 of the\nAgreement on Agriculture, and Article 8 of the Agreement on Trade-Related Investment Measures\n(TRIMs Agreement) with respect to Venezuelan import licensing systems and practices that restrict\nagricultural imports from the United States.\nIn view of the substantial trade interest of the European Communities in this matter, my\nauthorities have instructed me to notify you of the desire of the European Communities to be joined in\nthe consultations between Venezuela and the United States pursuant to Article 4.11 of the DSU.\nThe European Communities looks forward to receiving your reply to this request."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:56.035510"}}},{"rowIdx":4087,"cells":{"folder_number":{"kind":"string","value":"275"},"case_number":{"kind":"string","value":"275"},"original_filename":{"kind":"string","value":"DS275_SEQ03_Request_To_Join_Consultations_01.pdf"},"new_filename":{"kind":"string","value":"DS275_SEQ03_Request_To_Join_Consultations_01.pdf"},"doc_sequence":{"kind":"number","value":3,"string":"3"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from Canada"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":1,"string":"1"},"case_title":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS"},"date":{"kind":"string","value":"25 November 2002"},"header_codes":{"kind":"string","value":"WT/DS275/3"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Venezuela']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by the United States.\nOn 7 November 2002 the United States requested\n consultations with Venezuela concerning Venezuelan import licensing\n systems and practices that restrict agricultural imports from the United\n States. According to the United States, Venezuela has established import\n licensing requirements for numerous agricultural products, including corn,\n sorghum, dairy products (for example, cheese, whey, whole milk powder, and\n non-fat dry milk), grapes, yellow grease, poultry, beef, pork, and soybean\n meal.\nThe United States claimed that Venezuela appears to\n have established a discretionary import licensing regime for the above\n products. It further claimed that, through its import licensing practices,\n Venezuela has failed to establish a transparent and predictable system for\n issuing import licenses and has severely restricted and distorted trade in\n these goods.\nThe United States alleges that Venezuela’s import\n licensing systems and practices appear to be inconsistent with Article 4.2\n of the Agreement on Agriculture; Articles III, X, XI, and XIII of GATT\n 1994; Article 2.1 of the TRIMs Agreement, and Articles 1.4, 3.2, 3.5, 5.1,\n 5.2, and 5.3 of the Import Licensing Agreement. Venezuela’s measures also\n appear to nullify or impair the benefits accruing to the United States\n directly or indirectly under the cited agreements.\nOn 20 November 2002, the EC and Canada requested to\n join the consultations. On 21 November 2002, New Zealand and Chile\n requested to join the consultations. On 22 November 2002, Argentina and\n Colombia requested to join the consultations. On 25 November 2002,\n Venezuela informed the DSB that it had accepted the requests of Argentina,\n Canada, Chile, the EC and New Zealand to join the consultations."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON\nCERTAIN AGRICULTURAL PRODUCTS\nRequest to Join Consultations\nCommunication from Canada\nThe following communication, dated 20 November 2002, from the Permanent Mission of\nCanada to the Permanent Mission of Venezuela, the Permanent Mission of the United States and to\nthe Chairman of the Dispute Settlement Body, is circulated in accordance with Article 4.11of the\nDSU.\nPursuant to Article 4.11 of the Understanding on Rules and Procedures Governing the\nSettlement of Disputes (DSU), the Government of Canada hereby notifies its desire to be joined in\nconsultations requested by the United States pursuant to Articles 1 and 4 of the DSU, Article XXII of\nthe General Agreement on Tariffs and Trade 1994 (GATT 1994), Article 6 of the Agreement on\nImport Licensing Procedures (Import Licensing Agreement), Article 19 of the Agreement on\nAgriculture, and Article 8 of the Agreement on Trade-Related Investment Measures (TRIMs\nAgreement), with respect to Venezuelan import licensing systems and practices that restrict\nagricultural imports.\nThe relevant communication from the Permanent Mission of the United States to the\nPermanent Mission of Venezuela, dated 7 November 2002, was circulated to WTO Members on\n12 November 2002 (, , , , ).\nCanadian exports of certain agri-food products, including meat, seed potatoes, table potatoes,\nonions and pulses, have been affected by Venezuela's import licensing systems and practices. Canada\ntherefore has a substantial trade interest in the matters under consultation.\nWe look forward to receiving your advice regarding the date and venue for these\nconsultations."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:56.036010"}}},{"rowIdx":4088,"cells":{"folder_number":{"kind":"string","value":"275"},"case_number":{"kind":"string","value":"275"},"original_filename":{"kind":"string","value":"DS275_SEQ04_Request_To_Join_Consultations_02.pdf"},"new_filename":{"kind":"string","value":"DS275_SEQ04_Request_To_Join_Consultations_02.pdf"},"doc_sequence":{"kind":"number","value":4,"string":"4"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from New Zealand"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":2,"string":"2"},"case_title":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS"},"date":{"kind":"string","value":"26 November 2002"},"header_codes":{"kind":"string","value":"WT/DS275/4; WT/DS275/1; G/L/587; G/LIC/D/35; G/AG/GEN/55"},"agreement_indicators":{"kind":"string","value":"Agriculture (AG); General Council; Import Licensing (LIC)"},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Venezuela']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by the United States.\nOn 7 November 2002 the United States requested\n consultations with Venezuela concerning Venezuelan import licensing\n systems and practices that restrict agricultural imports from the United\n States. According to the United States, Venezuela has established import\n licensing requirements for numerous agricultural products, including corn,\n sorghum, dairy products (for example, cheese, whey, whole milk powder, and\n non-fat dry milk), grapes, yellow grease, poultry, beef, pork, and soybean\n meal.\nThe United States claimed that Venezuela appears to\n have established a discretionary import licensing regime for the above\n products. It further claimed that, through its import licensing practices,\n Venezuela has failed to establish a transparent and predictable system for\n issuing import licenses and has severely restricted and distorted trade in\n these goods.\nThe United States alleges that Venezuela’s import\n licensing systems and practices appear to be inconsistent with Article 4.2\n of the Agreement on Agriculture; Articles III, X, XI, and XIII of GATT\n 1994; Article 2.1 of the TRIMs Agreement, and Articles 1.4, 3.2, 3.5, 5.1,\n 5.2, and 5.3 of the Import Licensing Agreement. Venezuela’s measures also\n appear to nullify or impair the benefits accruing to the United States\n directly or indirectly under the cited agreements.\nOn 20 November 2002, the EC and Canada requested to\n join the consultations. On 21 November 2002, New Zealand and Chile\n requested to join the consultations. On 22 November 2002, Argentina and\n Colombia requested to join the consultations. On 25 November 2002,\n Venezuela informed the DSB that it had accepted the requests of Argentina,\n Canada, Chile, the EC and New Zealand to join the consultations."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON\nCERTAIN AGRICULTURAL PRODUCTS\nRequest to Join Consultations\nCommunication from New Zealand\nThe following communication, dated 21 November 2002, from the Permanent Mission of\nNew Zealand to the Permanent Mission of Venezuela, the Permanent Mission of the United States and\nto the Chairman of the Dispute Settlement Body, is circulated in accordance with Article 4.11of the\nDSU.\nI am writing with reference to document , , ,\n, G/TRIMS/ D/19 of 12 November 2002 containing the United States request for\nconsultations pursuant to Articles 1 and 4 of the Understanding on Rules and Procedures Governing\nthe Settlement of Disputes (DSU), Article XXII of the General Agreement on Tariffs and Trade 1994,\nArticle 6 of the Agreement on Import Licensing Procedures , Article 19 of the Agreement on\nAgriculture and Article 8 of the Agreement on Trade-Related Investment Measures , with respect to\nVenezuelan import licensing systems and procedures on certain agricultural products. In view of New\nZealand's substantial trade interest in the subject matter of these consultations, and in accordance with\nArticle 4.11 of the DSU, I am writing to advise you of New Zealand's desire to be joined in these\nconsultations.\nI look forward to your advice regarding the timing and venue for the consultations."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:56.036429"}}},{"rowIdx":4089,"cells":{"folder_number":{"kind":"string","value":"275"},"case_number":{"kind":"string","value":"275"},"original_filename":{"kind":"string","value":"DS275_SEQ05_Request_To_Join_Consultations_03.pdf"},"new_filename":{"kind":"string","value":"DS275_SEQ05_Request_To_Join_Consultations_03.pdf"},"doc_sequence":{"kind":"number","value":5,"string":"5"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from Argentina"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":3,"string":"3"},"case_title":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS"},"date":{"kind":"string","value":"27 November 2002"},"header_codes":{"kind":"string","value":"WT/DS275/5; WT/DS275/1; G/L/587; G/LIC/D/35; G/AG/GEN/55; G/TRIMS/D/19"},"agreement_indicators":{"kind":"string","value":"Agriculture (AG); General Council; Import Licensing (LIC); Trade-Related Investment Measures (TRIMS)"},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Venezuela']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by the United States.\nOn 7 November 2002 the United States requested\n consultations with Venezuela concerning Venezuelan import licensing\n systems and practices that restrict agricultural imports from the United\n States. According to the United States, Venezuela has established import\n licensing requirements for numerous agricultural products, including corn,\n sorghum, dairy products (for example, cheese, whey, whole milk powder, and\n non-fat dry milk), grapes, yellow grease, poultry, beef, pork, and soybean\n meal.\nThe United States claimed that Venezuela appears to\n have established a discretionary import licensing regime for the above\n products. It further claimed that, through its import licensing practices,\n Venezuela has failed to establish a transparent and predictable system for\n issuing import licenses and has severely restricted and distorted trade in\n these goods.\nThe United States alleges that Venezuela’s import\n licensing systems and practices appear to be inconsistent with Article 4.2\n of the Agreement on Agriculture; Articles III, X, XI, and XIII of GATT\n 1994; Article 2.1 of the TRIMs Agreement, and Articles 1.4, 3.2, 3.5, 5.1,\n 5.2, and 5.3 of the Import Licensing Agreement. Venezuela’s measures also\n appear to nullify or impair the benefits accruing to the United States\n directly or indirectly under the cited agreements.\nOn 20 November 2002, the EC and Canada requested to\n join the consultations. On 21 November 2002, New Zealand and Chile\n requested to join the consultations. On 22 November 2002, Argentina and\n Colombia requested to join the consultations. On 25 November 2002,\n Venezuela informed the DSB that it had accepted the requests of Argentina,\n Canada, Chile, the EC and New Zealand to join the consultations."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON\nCERTAIN AGRICULTURAL PRODUCTS\nRequest to Join Consultations\nCommunication from Argentina\nThe following communication, dated 22 November 2002, from the Permanent Mission of\nArgentina to the Permanent Mission of Venezuela, the Permanent Mission of the United States and\nthe Chairman of the Dispute Settlement Body, is circulated in accordance with Article 4.11 of the\nDSU.\nI hereby refer to the request for consultations by the United States with respect to Venezuelan\nimport licensing systems and practices regarding certain agricultural products, contained in document\n, , , , dated 12 November 2002.\nIn view of its substantial trade interest as a producer/exporter of various agricultural products,\nArgentina requests to be joined in the aforementioned consultations, pursuant to the procedures\nestablished in Article 4.11 of the Understanding on Rules and Procedures Governing the Settlement of\nDisputes (DSU). Argentina exports to Venezuela black beans ( caraota), white beans and other\nvarieties, for which Venezuela is its second largest export market, dairy products and vegetable oils\n(crude and refined).\nThe above request is based on the fact that bean products from Argentina have been affected\nby a number of trade restrictions (such as delays in granting phytosanitary import permits, failure to\nissue the non-domestic production certificate, and so forth).\nMoreover, Argentina is concerned about practices that result in failure to process import\nlicensing applications in a timely fashion for all the above-mentioned products, as well as other\npractices that restrict access to the Venezuelan market for Argentine agricultural exports, including\nfailure to publish the rules governing import licensing procedures."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:56.036937"}}},{"rowIdx":4090,"cells":{"folder_number":{"kind":"string","value":"275"},"case_number":{"kind":"string","value":"275"},"original_filename":{"kind":"string","value":"DS275_SEQ06_Request_To_Join_Consultations_04.pdf"},"new_filename":{"kind":"string","value":"DS275_SEQ06_Request_To_Join_Consultations_04.pdf"},"doc_sequence":{"kind":"number","value":6,"string":"6"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from Colombia"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":4,"string":"4"},"case_title":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS"},"date":{"kind":"string","value":"27 November 2002"},"header_codes":{"kind":"string","value":"WT/DS275/6; WT/DS275/1; G/L/587"},"agreement_indicators":{"kind":"string","value":"General Council"},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Venezuela']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by the United States.\nOn 7 November 2002 the United States requested\n consultations with Venezuela concerning Venezuelan import licensing\n systems and practices that restrict agricultural imports from the United\n States. According to the United States, Venezuela has established import\n licensing requirements for numerous agricultural products, including corn,\n sorghum, dairy products (for example, cheese, whey, whole milk powder, and\n non-fat dry milk), grapes, yellow grease, poultry, beef, pork, and soybean\n meal.\nThe United States claimed that Venezuela appears to\n have established a discretionary import licensing regime for the above\n products. It further claimed that, through its import licensing practices,\n Venezuela has failed to establish a transparent and predictable system for\n issuing import licenses and has severely restricted and distorted trade in\n these goods.\nThe United States alleges that Venezuela’s import\n licensing systems and practices appear to be inconsistent with Article 4.2\n of the Agreement on Agriculture; Articles III, X, XI, and XIII of GATT\n 1994; Article 2.1 of the TRIMs Agreement, and Articles 1.4, 3.2, 3.5, 5.1,\n 5.2, and 5.3 of the Import Licensing Agreement. Venezuela’s measures also\n appear to nullify or impair the benefits accruing to the United States\n directly or indirectly under the cited agreements.\nOn 20 November 2002, the EC and Canada requested to\n join the consultations. On 21 November 2002, New Zealand and Chile\n requested to join the consultations. On 22 November 2002, Argentina and\n Colombia requested to join the consultations. On 25 November 2002,\n Venezuela informed the DSB that it had accepted the requests of Argentina,\n Canada, Chile, the EC and New Zealand to join the consultations."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON\nCERTAIN AGRICULTURAL PRODUCTS\nRequest to Join Consultations\nCommunication from Colombia\nThe following communication, dated 22 November 2002, from the Permanent Mission of\nColombia to the Permanent Mission of Venezuela, the Permanent Mission of the United States and\nthe Chairman of the Dispute Settlement Body, is circulated in accordance with Article 4.11 of the\nDSU.\nI hereby refer to the communication from the Permanent Mission of the United States, dated\n7 November 2002 and published in document , , requesting consultations with\nrespect to Venezuelan import licensing systems and practices that restrict agricultural imports from\nthe United States.\nIn view of Colombia's substantial interest in the matter, I hereby notify our interest in being\njoined in the consultations, in accordance with our rights under the multilateral system and in\nparticular pursuant to paragraph 4 of the Decision of 28 November 1979 of the GATT Contracting\nParties on Differential and More Favourable Treatment, Reciprocity and Fuller Participation of\nDeveloping Countries (L/4903, BISD 26S/203) (Enabling Clause)."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:56.037299"}}},{"rowIdx":4091,"cells":{"folder_number":{"kind":"string","value":"275"},"case_number":{"kind":"string","value":"275"},"original_filename":{"kind":"string","value":"DS275_SEQ07_Request_To_Join_Consultations_05.pdf"},"new_filename":{"kind":"string","value":"DS275_SEQ07_Request_To_Join_Consultations_05.pdf"},"doc_sequence":{"kind":"number","value":7,"string":"7"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from Chile"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":5,"string":"5"},"case_title":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS"},"date":{"kind":"string","value":"27 November 2002"},"header_codes":{"kind":"string","value":"WT/DS275/7; G/L/587; G/GEN/55; G/TRIMS/D/19."},"agreement_indicators":{"kind":"string","value":"General Council; Trade-Related Investment Measures (TRIMS)"},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Venezuela']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by the United States.\nOn 7 November 2002 the United States requested\n consultations with Venezuela concerning Venezuelan import licensing\n systems and practices that restrict agricultural imports from the United\n States. According to the United States, Venezuela has established import\n licensing requirements for numerous agricultural products, including corn,\n sorghum, dairy products (for example, cheese, whey, whole milk powder, and\n non-fat dry milk), grapes, yellow grease, poultry, beef, pork, and soybean\n meal.\nThe United States claimed that Venezuela appears to\n have established a discretionary import licensing regime for the above\n products. It further claimed that, through its import licensing practices,\n Venezuela has failed to establish a transparent and predictable system for\n issuing import licenses and has severely restricted and distorted trade in\n these goods.\nThe United States alleges that Venezuela’s import\n licensing systems and practices appear to be inconsistent with Article 4.2\n of the Agreement on Agriculture; Articles III, X, XI, and XIII of GATT\n 1994; Article 2.1 of the TRIMs Agreement, and Articles 1.4, 3.2, 3.5, 5.1,\n 5.2, and 5.3 of the Import Licensing Agreement. Venezuela’s measures also\n appear to nullify or impair the benefits accruing to the United States\n directly or indirectly under the cited agreements.\nOn 20 November 2002, the EC and Canada requested to\n join the consultations. On 21 November 2002, New Zealand and Chile\n requested to join the consultations. On 22 November 2002, Argentina and\n Colombia requested to join the consultations. On 25 November 2002,\n Venezuela informed the DSB that it had accepted the requests of Argentina,\n Canada, Chile, the EC and New Zealand to join the consultations."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON\nCERTAIN AGRICULTURAL PRODUCTS\nRequest to Join Consultations\nCommunication from Chile\nThe following communication, dated 21 November 2002, from the Permanent Mission of\nChile to the Permanent Mission of Venezuela, the Permanent Mission of the United States and the\nChairman of the Dispute Settlement Body, is circulated in accordance with Article 4.11 of the DSU.\nI hereby refer to the request for consultations by the United States with respect to import\nlicensing systems and practices that restrict agricultural imports into Venezuela, circulated on\n12 November 2002 as document WT/D S275/1, , G/LI C/D/35, G/ A,\n\nThe measures challenged by the United States generally affect imports of the products at\nissue, whatever their origin. Chilean exports of products such as fresh fruit and vegetables and white\nmeat have thus been seriously affected, and in certain instances prohibited, by such measures. For\nexample, Chilean exports of fresh apples, grapes, pears, plums, kiwis, cherries, peaches, asparagus,\npomegranates, quinces, and so forth have been subject to restrictions. Total exports of fresh fruit and\nvegetables to Venezuela amounted to 3,278,832 crates in the season 2000-2001, i.e. a more than\n10 per cent reduction in relation to the previous season. A noteworthy case is that of fresh garlic, for\nwhich import permits were not issued despite the granting of a quota by Venezuela under the bilateral\ntrade agreement. Imports of white meat (chicken, turkey and pork) underwent an even more drastic\nreduction. As a result of the restrictions in question, in 2001 sales to Venezuela of such products fell\nby more than 66 per cent in relation to the previous year.\nIn view of the foregoing, and pursuant to Article 4.11 of the Understanding on Rules and\nProcedures Governing the Settlement of Disputes, the Government of Chile respectfully requests to be\njoined in the consultations on account of its substantial trade interest and substantial and systemic\ninterest in this case.\nI should be obliged if you would kindly inform us of the date and place of the consultations."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:56.037884"}}},{"rowIdx":4092,"cells":{"folder_number":{"kind":"string","value":"275"},"case_number":{"kind":"string","value":"275"},"original_filename":{"kind":"string","value":"DS275_SEQ08_Request_To_Join_Consultations_06.pdf"},"new_filename":{"kind":"string","value":"DS275_SEQ08_Request_To_Join_Consultations_06.pdf"},"doc_sequence":{"kind":"number","value":8,"string":"8"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Acceptance by Venezuela of the Requests to Join Consultations Argentina, Canada, Chile, Colombia, the European Communities and New Zealand notified the Dispute Settlement Body of their desire to be joined in the consultations requested by the United States, pursuant to Article 4.11 of the DSU. The Permanent Mission of Venezuela informed the Dispute Settlement Body that it had accepted the requests of Argentina, Canada, Chile, the European Communities and New Zealand to join the consultations. VENEZUELA - MESURES CONCERNANT LES LICENCES D'IMPORTATION APPLICABLES À CERTAINS PRODUITS AGRICOLES Acceptation par le Venezuela des demandes de participation aux consultations L'Argentine, le Canada, le Chili, la Colombie, les Communautés européennes et la Nouvelle-Zélande ont fait savoir à l'ORD qu'ils désiraient participer aux consultations demandées par les États-Unis, conformément à l'article 4:11 du Mémorandum d'accord sur le règlement des différends."},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":6,"string":"6"},"case_title":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS"},"date":{"kind":"string","value":"28 November 2002"},"header_codes":{"kind":"string","value":"WT/DS275/8"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Venezuela']"},"third_parties":{"kind":"string","value":"[]"},"dispute_stage":{"kind":"string","value":"Consultation"},"agreements_cited":{"kind":"string","value":"Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\nConsultations\nComplaint by the United States.\nOn 7 November 2002 the United States requested\n consultations with Venezuela concerning Venezuelan import licensing\n systems and practices that restrict agricultural imports from the United\n States. According to the United States, Venezuela has established import\n licensing requirements for numerous agricultural products, including corn,\n sorghum, dairy products (for example, cheese, whey, whole milk powder, and\n non-fat dry milk), grapes, yellow grease, poultry, beef, pork, and soybean\n meal.\nThe United States claimed that Venezuela appears to\n have established a discretionary import licensing regime for the above\n products. It further claimed that, through its import licensing practices,\n Venezuela has failed to establish a transparent and predictable system for\n issuing import licenses and has severely restricted and distorted trade in\n these goods.\nThe United States alleges that Venezuela’s import\n licensing systems and practices appear to be inconsistent with Article 4.2\n of the Agreement on Agriculture; Articles III, X, XI, and XIII of GATT\n 1994; Article 2.1 of the TRIMs Agreement, and Articles 1.4, 3.2, 3.5, 5.1,\n 5.2, and 5.3 of the Import Licensing Agreement. Venezuela’s measures also\n appear to nullify or impair the benefits accruing to the United States\n directly or indirectly under the cited agreements.\nOn 20 November 2002, the EC and Canada requested to\n join the consultations. On 21 November 2002, New Zealand and Chile\n requested to join the consultations. On 22 November 2002, Argentina and\n Colombia requested to join the consultations. On 25 November 2002,\n Venezuela informed the DSB that it had accepted the requests of Argentina,\n Canada, Chile, the EC and New Zealand to join the consultations."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"VENEZUELA – IMPORT LICENSING MEASURES ON\nCERTAIN AGRICULTURAL PRODUCTS\nAcceptance by Venezuela of the Requests to Join Consultations\nArgentina, Canada, Chile, Colombia, the European Communities and New Zealand notified\nthe Dispute Settlement Body of their desire to be joined in the consultations requested by the United\nStates, pursuant to Article 4.11 of the DSU.\nThe Permanent Mission of Venezuela informed the Dispute Settlement Body that it had\naccepted the requests of Argentina, Canada, Chile, the European Communities and New Zealand to\njoin the consultations.\nVENEZUELA - MESURES CONCERNANT LES LICENCES D'IMPORTATION\nAPPLICABLES À CERTAINS PRODUITS AGRICOLES\nde participation aux consultations\nNouvelle-Zélande ont fait savoir à l'ORD qu'ils désiraient participer aux consultations demandées par\ndifférends.\nVENEZUELA - MEDIDAS EN MATERIA DE LICENCIAS DE\nIMPORTACIÓN SOBRE DETERMINADOS\nPRODUCTOS AGRÍCOLAS\nnotificaron al Órgano de Solución de Diferencias su deseo de que se las asociara a las consultas\nLa Misión Permanente de Venezuela ha informado al Órgano de Solución de Diferencias de\nZelandia de asociación a las consultas."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:56.038429"}}},{"rowIdx":4093,"cells":{"folder_number":{"kind":"string","value":"276"},"case_number":{"kind":"string","value":"276"},"original_filename":{"kind":"string","value":"DS276_SEQ01_Request_For_Consultations.pdf"},"new_filename":{"kind":"string","value":"DS276_SEQ01_Request_For_Consultations.pdf"},"doc_sequence":{"kind":"number","value":1,"string":"1"},"doc_type":{"kind":"string","value":"Request_For_Consultations"},"doc_type_raw":{"kind":"string","value":"Request for Consultations by the United States"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"null"},"case_title":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN"},"date":{"kind":"string","value":"19 December 2002"},"header_codes":{"kind":"string","value":"WT/DS276/1; G/L/597; G/TRIMS/D/20"},"agreement_indicators":{"kind":"string","value":"General Council; Trade-Related Investment Measures (TRIMS)"},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Canada']"},"third_parties":{"kind":"string","value":"['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico']"},"dispute_stage":{"kind":"string","value":"Appellate Body"},"agreements_cited":{"kind":"string","value":"Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\n\n See also: One-page summary of key findings of this dispute\nConsultations\nComplaint by the United States.\nOn 17 December 2002, the United States requested\n consultations with Canada as regards matters concerning the export of\n wheat by the Canadian Wheat Board and the treatment accorded by Canada to\n grain imported into Canada.\nAccording to the United States, the actions of the\n Government of Canada and the Canadian Wheat Board (entity enjoying\n exclusive rights to purchase and sell Western Canadian wheat for human\n consumption) related to export of wheat appear to be inconsistent with\n paragraphs 1(a) and 1(b) of Article XVII of GATT 1994.\nAs regards the treatment of grain imported into Canada,\n the United States maintains that the following Canadian measures are\n inconsistent with Article III of the GATT 1994 and Article 2 of TRIMs\n since they discriminate against imported grain:\nOn 20 December 2002, the European Communities, Japan\n and Mexico requested to join the consultations. On 24 December 2002,\n Australia requested to join the consultations. On 6 March 2003, the US\n requested the establishment of a panel. At its meeting on 18 March 2003,\n the DSB deferred the establishment of a panel.\n\nPanel and Appellate Body proceedings\nFurther to a second request\n by the US, the DSB established a Panel at its meeting on 31 March 2003.\n Chile, Chinese Taipei, the EC, Japan and Mexico reserved their third-party\n rights. On 9 and 10 April 2003 respectively, China and Australia reserved\n their third-party rights. On 2 May 2003, Canada requested the\n Director-General to compose the panel. On 12 May 2003, the\n Director-General composed the panel. On 30 June 2003, the United States\n submitted a new request for the establishment of a panel. On 1 July 2003,\n the Chair of the Panel informed the DSB that it had agreed to the United\n States’ request to suspend the Panel for three weeks from 1-21 July 2003.\n The DSB established a second panel at its meeting on 11 July 2003.\n Australia, Chile, China, the EC, Japan and Chinese Taipei reserved their\n third-party rights. On 25 July 2003, Mexico reserved its third-party\n rights. On 11 July 2003, the second Panel was composed. Further to a\n request by the United States, acceded to by the Panel, the preliminary\n ruling by the Panel was circulated to Members for their information on 21\n July 2003. On 30 October 2003, the Chairman of the Panel informed the DSB\n that the first Panel would not be able to complete its work within six\n months due to the three week suspension requested by the US following the\n issuance of a preliminary ruling by the Panel and the harmonization of\n this Panel’s timetable with that of the second Panel and that the Panel\n expected to issue its final report to the parties in February 2004.\nOn 6 April 2004, the Panel report was circulated to\n Members. The Panel found that:\nOn 1 June 2004, the United States notified its decision\n to appeal to the Appellate Body certain issues of law covered in the Panel\n Report and certain legal interpretations developed by the Panel.\nOn 30 August 2004, the Appellate Body Report was\n circulated to Members. The Appellate Body upheld the Panel’s conclusion\n that the United States had not demonstrated that the Canadian Wheat Board\n (CWB) Export Regime is inconsistent with Article XVII:1 of the GATT 1994.\n At its meeting on 27 September 2004, the DSB adopted the Appellate Body\n report and the Panel report, as modified by the Appellate Body report.\n\nImplementation of adopted reports\nAt the DSB meeting on\n 18 October 2004, Canada stated that it was the intention of Canada\n to implement the recommendations and rulings of the DSB in a manner that\n respected its WTO obligations, and that it would require a reasonable\n period of time to implement the recommendations and rulings of the DSB and\n was ready to consult with the United States in accordance with Article\n 21.3(b) of the DSU.\nOn 15 November 2004, Canada and the United States informed the DSB that\n they had agreed that the reasonable period of time shall be is\n 10 months and 5 days, that is, 27 September 2004 to 1 August 2005.\nAt the DSB meeting on 31 August 2005, Canada announced that amendments to the Canada Transportation Act and the Canada Grain Act and associated regulatory changes had come into force on 1 August 2005 thus bringing Canada into compliance with the DSB’s recommendations and rulings."},"page_count":{"kind":"number","value":2,"string":"2"},"clean_text":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT\nAND TREATMENT OF IMPORTED GRAIN\nRequest for Consultations by the United States\nThe following communication, dated 17 December 2002, from the Permanent Mission of the\nUnited States to the Permanent Mission of Canada and to the Chairman of the Dispute Settlement\nBody, is circulated in accordance with Article 4.4 of the DSU.\nMy authorities have instructed me to request consultations with Canada pursuant to Article 4\nof the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU),\nArticle XXII:1 of the General Agreement on Tariffs and Trade 1994 (GATT 1994), and Article 8 of\nthe Agreement on Trade-Related Investment Measures (to the extent it incorporates by reference\nArticle XXII of the GATT 1994) with regard to matters concerning the export of wheat by the\nCanadian Wheat Board and the treatment accorded by Canada to grain imported into Canada.\nThe Government of Canada has established the Canadian Wheat Board, and has granted to\nthis enterprise exclusive and special privileges, including the exclusive rights to purchase and sell\nWestern Canadian wheat for human consumption. The actions of the Government of Canada and the\nCanadian Wheat Board appear to be inconsistent with the obligations of the Government of Canada\nunder Article XVII of the GATT 1994. In particular, the activities of the Government of Canada and\nthe Canadian Wheat Board related to exports of wheat appear to be:\n• inconsistent with paragraph 1(a) of Article XVII of the GATT 1994, which requires State\nenterprises in their purchases or sales involving exports to act in a manner consistent with the\ngeneral principles of non-discriminatory treatment prescribed in the GATT 1994; and\n• inconsistent with paragraph 1(b) of Arti cle XVII of the GATT 1994, which requires State\nenterprises to make such purchases or sa les solely in accordance with commercial\nconsiderations and to afford the enterprises of other WTO Members adequate opportunity, in\naccordance with customary business practice, to compete for such purchases or sales.\nWith regard to the treatment of grain that is imported into Canada, Canadian measures\ndiscriminate against imported grain, including grain that is the product of the United States:\n• Under the Canadian Grain Act and Canadian grain regulations, imported wheat may not be\nmixed with Canadian domestic grain being received into, or being discharged out of, grain\nelevators. This treatment appears to be inconsistent with the obligations of Canada under\nArticle III of the GATT 1994 and Article 2 of the Agreement on Trade-Related Investment\nMeasures.\n\n• Canadian law caps the maximum revenues that railroads may receive on the shipment of\nCanadian domestic grain, but not revenues that may be received on the shipment of imported\ngrain. In addition, in allocating government-owned railcars used for the transport of grain,\nCanada provides a preference for domestic grain over imported grain. These measures related\nto rail transportation appear to be inconsistent with the obligations of Canada under Article III\nof the GATT 1994 and Article 2 of the Agreement on Trade-Related Investment Measures.\nWe look forward to receiving your reply to this request and to fixing a mutually acceptable\ndate for consultations."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:58.890902"}}},{"rowIdx":4094,"cells":{"folder_number":{"kind":"string","value":"276"},"case_number":{"kind":"string","value":"276"},"original_filename":{"kind":"string","value":"DS276_SEQ02_Request_To_Join_Consultations_00.pdf"},"new_filename":{"kind":"string","value":"DS276_SEQ02_Request_To_Join_Consultations_00.pdf"},"doc_sequence":{"kind":"number","value":2,"string":"2"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from Japan"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":0,"string":"0"},"case_title":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN"},"date":{"kind":"string","value":"7 January 2003"},"header_codes":{"kind":"string","value":"WT/DS276/2"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Canada']"},"third_parties":{"kind":"string","value":"['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico']"},"dispute_stage":{"kind":"string","value":"Appellate Body"},"agreements_cited":{"kind":"string","value":"Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\n\n See also: One-page summary of key findings of this dispute\nConsultations\nComplaint by the United States.\nOn 17 December 2002, the United States requested\n consultations with Canada as regards matters concerning the export of\n wheat by the Canadian Wheat Board and the treatment accorded by Canada to\n grain imported into Canada.\nAccording to the United States, the actions of the\n Government of Canada and the Canadian Wheat Board (entity enjoying\n exclusive rights to purchase and sell Western Canadian wheat for human\n consumption) related to export of wheat appear to be inconsistent with\n paragraphs 1(a) and 1(b) of Article XVII of GATT 1994.\nAs regards the treatment of grain imported into Canada,\n the United States maintains that the following Canadian measures are\n inconsistent with Article III of the GATT 1994 and Article 2 of TRIMs\n since they discriminate against imported grain:\nOn 20 December 2002, the European Communities, Japan\n and Mexico requested to join the consultations. On 24 December 2002,\n Australia requested to join the consultations. On 6 March 2003, the US\n requested the establishment of a panel. At its meeting on 18 March 2003,\n the DSB deferred the establishment of a panel.\n\nPanel and Appellate Body proceedings\nFurther to a second request\n by the US, the DSB established a Panel at its meeting on 31 March 2003.\n Chile, Chinese Taipei, the EC, Japan and Mexico reserved their third-party\n rights. On 9 and 10 April 2003 respectively, China and Australia reserved\n their third-party rights. On 2 May 2003, Canada requested the\n Director-General to compose the panel. On 12 May 2003, the\n Director-General composed the panel. On 30 June 2003, the United States\n submitted a new request for the establishment of a panel. On 1 July 2003,\n the Chair of the Panel informed the DSB that it had agreed to the United\n States’ request to suspend the Panel for three weeks from 1-21 July 2003.\n The DSB established a second panel at its meeting on 11 July 2003.\n Australia, Chile, China, the EC, Japan and Chinese Taipei reserved their\n third-party rights. On 25 July 2003, Mexico reserved its third-party\n rights. On 11 July 2003, the second Panel was composed. Further to a\n request by the United States, acceded to by the Panel, the preliminary\n ruling by the Panel was circulated to Members for their information on 21\n July 2003. On 30 October 2003, the Chairman of the Panel informed the DSB\n that the first Panel would not be able to complete its work within six\n months due to the three week suspension requested by the US following the\n issuance of a preliminary ruling by the Panel and the harmonization of\n this Panel’s timetable with that of the second Panel and that the Panel\n expected to issue its final report to the parties in February 2004.\nOn 6 April 2004, the Panel report was circulated to\n Members. The Panel found that:\nOn 1 June 2004, the United States notified its decision\n to appeal to the Appellate Body certain issues of law covered in the Panel\n Report and certain legal interpretations developed by the Panel.\nOn 30 August 2004, the Appellate Body Report was\n circulated to Members. The Appellate Body upheld the Panel’s conclusion\n that the United States had not demonstrated that the Canadian Wheat Board\n (CWB) Export Regime is inconsistent with Article XVII:1 of the GATT 1994.\n At its meeting on 27 September 2004, the DSB adopted the Appellate Body\n report and the Panel report, as modified by the Appellate Body report.\n\nImplementation of adopted reports\nAt the DSB meeting on\n 18 October 2004, Canada stated that it was the intention of Canada\n to implement the recommendations and rulings of the DSB in a manner that\n respected its WTO obligations, and that it would require a reasonable\n period of time to implement the recommendations and rulings of the DSB and\n was ready to consult with the United States in accordance with Article\n 21.3(b) of the DSU.\nOn 15 November 2004, Canada and the United States informed the DSB that\n they had agreed that the reasonable period of time shall be is\n 10 months and 5 days, that is, 27 September 2004 to 1 August 2005.\nAt the DSB meeting on 31 August 2005, Canada announced that amendments to the Canada Transportation Act and the Canada Grain Act and associated regulatory changes had come into force on 1 August 2005 thus bringing Canada into compliance with the DSB’s recommendations and rulings."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT\nAND TREATMENT OF IMPORTED GRAIN\nRequest to Join Consultations\nCommunication from Japan\nThe following communication, dated 20 December 2002, from the Permanent Mission of\nJapan to the Permanent Mission of Canada, the Permanent Mission of the United States and to the\nChairman of the Dispute Settlement Body, is circulated in accordance with Article 4.11 of the DSU.\nPursuant to paragraph 11 of Article 4 of the Understanding on Rules and Procedures\nGoverning the Settlement of Disputes (DSU), the Government of Japan hereby notifies the\nGovernment of Canada that, in light of the substantial trade interest of Japan, it desires to be joined in\nthe consultations requested by the United States in a communication circulated to WTO Members on\n19 December 2002 (, , ) titled \" \".\nAs a major importer of wheat from Canada and the United States, Japan has a substantial\ntrade interest in this case."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:58.891302"}}},{"rowIdx":4095,"cells":{"folder_number":{"kind":"string","value":"276"},"case_number":{"kind":"string","value":"276"},"original_filename":{"kind":"string","value":"DS276_SEQ03_Request_To_Join_Consultations_01.pdf"},"new_filename":{"kind":"string","value":"DS276_SEQ03_Request_To_Join_Consultations_01.pdf"},"doc_sequence":{"kind":"number","value":3,"string":"3"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from Mexico"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":1,"string":"1"},"case_title":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN"},"date":{"kind":"string","value":"6 January 2003"},"header_codes":{"kind":"string","value":"WT/DS276/3; WT/DS276/1."},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Canada']"},"third_parties":{"kind":"string","value":"['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico']"},"dispute_stage":{"kind":"string","value":"Appellate Body"},"agreements_cited":{"kind":"string","value":"Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\n\n See also: One-page summary of key findings of this dispute\nConsultations\nComplaint by the United States.\nOn 17 December 2002, the United States requested\n consultations with Canada as regards matters concerning the export of\n wheat by the Canadian Wheat Board and the treatment accorded by Canada to\n grain imported into Canada.\nAccording to the United States, the actions of the\n Government of Canada and the Canadian Wheat Board (entity enjoying\n exclusive rights to purchase and sell Western Canadian wheat for human\n consumption) related to export of wheat appear to be inconsistent with\n paragraphs 1(a) and 1(b) of Article XVII of GATT 1994.\nAs regards the treatment of grain imported into Canada,\n the United States maintains that the following Canadian measures are\n inconsistent with Article III of the GATT 1994 and Article 2 of TRIMs\n since they discriminate against imported grain:\nOn 20 December 2002, the European Communities, Japan\n and Mexico requested to join the consultations. On 24 December 2002,\n Australia requested to join the consultations. On 6 March 2003, the US\n requested the establishment of a panel. At its meeting on 18 March 2003,\n the DSB deferred the establishment of a panel.\n\nPanel and Appellate Body proceedings\nFurther to a second request\n by the US, the DSB established a Panel at its meeting on 31 March 2003.\n Chile, Chinese Taipei, the EC, Japan and Mexico reserved their third-party\n rights. On 9 and 10 April 2003 respectively, China and Australia reserved\n their third-party rights. On 2 May 2003, Canada requested the\n Director-General to compose the panel. On 12 May 2003, the\n Director-General composed the panel. On 30 June 2003, the United States\n submitted a new request for the establishment of a panel. On 1 July 2003,\n the Chair of the Panel informed the DSB that it had agreed to the United\n States’ request to suspend the Panel for three weeks from 1-21 July 2003.\n The DSB established a second panel at its meeting on 11 July 2003.\n Australia, Chile, China, the EC, Japan and Chinese Taipei reserved their\n third-party rights. On 25 July 2003, Mexico reserved its third-party\n rights. On 11 July 2003, the second Panel was composed. Further to a\n request by the United States, acceded to by the Panel, the preliminary\n ruling by the Panel was circulated to Members for their information on 21\n July 2003. On 30 October 2003, the Chairman of the Panel informed the DSB\n that the first Panel would not be able to complete its work within six\n months due to the three week suspension requested by the US following the\n issuance of a preliminary ruling by the Panel and the harmonization of\n this Panel’s timetable with that of the second Panel and that the Panel\n expected to issue its final report to the parties in February 2004.\nOn 6 April 2004, the Panel report was circulated to\n Members. The Panel found that:\nOn 1 June 2004, the United States notified its decision\n to appeal to the Appellate Body certain issues of law covered in the Panel\n Report and certain legal interpretations developed by the Panel.\nOn 30 August 2004, the Appellate Body Report was\n circulated to Members. The Appellate Body upheld the Panel’s conclusion\n that the United States had not demonstrated that the Canadian Wheat Board\n (CWB) Export Regime is inconsistent with Article XVII:1 of the GATT 1994.\n At its meeting on 27 September 2004, the DSB adopted the Appellate Body\n report and the Panel report, as modified by the Appellate Body report.\n\nImplementation of adopted reports\nAt the DSB meeting on\n 18 October 2004, Canada stated that it was the intention of Canada\n to implement the recommendations and rulings of the DSB in a manner that\n respected its WTO obligations, and that it would require a reasonable\n period of time to implement the recommendations and rulings of the DSB and\n was ready to consult with the United States in accordance with Article\n 21.3(b) of the DSU.\nOn 15 November 2004, Canada and the United States informed the DSB that\n they had agreed that the reasonable period of time shall be is\n 10 months and 5 days, that is, 27 September 2004 to 1 August 2005.\nAt the DSB meeting on 31 August 2005, Canada announced that amendments to the Canada Transportation Act and the Canada Grain Act and associated regulatory changes had come into force on 1 August 2005 thus bringing Canada into compliance with the DSB’s recommendations and rulings."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT\nAND TREATMENT OF IMPORTED GRAIN\nRequest to Join Consultations\nCommunication from Mexico\nThe following communication, dated 20 December 2002, from the Permanent Mission of\nMexico to the Permanent Mission of Canada, the Pe rmanent Mission of the United States and to the\nChairman of the Dispute Settlement Body, is circulated in accordance with Article 4.11 of the DSU.\nPursuant to Article 4.11 of the DSU, I would here by like to notify Mexico's substantial trade\ninterest in this matter as an importer of Canadian wh eat, and its wish to be joined in the consultations\nrequested by the United States in document"},"processing_date":{"kind":"string","value":"2026-03-15T15:46:58.891568"}}},{"rowIdx":4096,"cells":{"folder_number":{"kind":"string","value":"276"},"case_number":{"kind":"string","value":"276"},"original_filename":{"kind":"string","value":"DS276_SEQ04_Request_To_Join_Consultations_02.pdf"},"new_filename":{"kind":"string","value":"DS276_SEQ04_Request_To_Join_Consultations_02.pdf"},"doc_sequence":{"kind":"number","value":4,"string":"4"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from the European Communities"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":2,"string":"2"},"case_title":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN"},"date":{"kind":"string","value":"7 January 2003"},"header_codes":{"kind":"string","value":"WT/DS276/4"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Canada']"},"third_parties":{"kind":"string","value":"['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico']"},"dispute_stage":{"kind":"string","value":"Appellate Body"},"agreements_cited":{"kind":"string","value":"Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\n\n See also: One-page summary of key findings of this dispute\nConsultations\nComplaint by the United States.\nOn 17 December 2002, the United States requested\n consultations with Canada as regards matters concerning the export of\n wheat by the Canadian Wheat Board and the treatment accorded by Canada to\n grain imported into Canada.\nAccording to the United States, the actions of the\n Government of Canada and the Canadian Wheat Board (entity enjoying\n exclusive rights to purchase and sell Western Canadian wheat for human\n consumption) related to export of wheat appear to be inconsistent with\n paragraphs 1(a) and 1(b) of Article XVII of GATT 1994.\nAs regards the treatment of grain imported into Canada,\n the United States maintains that the following Canadian measures are\n inconsistent with Article III of the GATT 1994 and Article 2 of TRIMs\n since they discriminate against imported grain:\nOn 20 December 2002, the European Communities, Japan\n and Mexico requested to join the consultations. On 24 December 2002,\n Australia requested to join the consultations. On 6 March 2003, the US\n requested the establishment of a panel. At its meeting on 18 March 2003,\n the DSB deferred the establishment of a panel.\n\nPanel and Appellate Body proceedings\nFurther to a second request\n by the US, the DSB established a Panel at its meeting on 31 March 2003.\n Chile, Chinese Taipei, the EC, Japan and Mexico reserved their third-party\n rights. On 9 and 10 April 2003 respectively, China and Australia reserved\n their third-party rights. On 2 May 2003, Canada requested the\n Director-General to compose the panel. On 12 May 2003, the\n Director-General composed the panel. On 30 June 2003, the United States\n submitted a new request for the establishment of a panel. On 1 July 2003,\n the Chair of the Panel informed the DSB that it had agreed to the United\n States’ request to suspend the Panel for three weeks from 1-21 July 2003.\n The DSB established a second panel at its meeting on 11 July 2003.\n Australia, Chile, China, the EC, Japan and Chinese Taipei reserved their\n third-party rights. On 25 July 2003, Mexico reserved its third-party\n rights. On 11 July 2003, the second Panel was composed. Further to a\n request by the United States, acceded to by the Panel, the preliminary\n ruling by the Panel was circulated to Members for their information on 21\n July 2003. On 30 October 2003, the Chairman of the Panel informed the DSB\n that the first Panel would not be able to complete its work within six\n months due to the three week suspension requested by the US following the\n issuance of a preliminary ruling by the Panel and the harmonization of\n this Panel’s timetable with that of the second Panel and that the Panel\n expected to issue its final report to the parties in February 2004.\nOn 6 April 2004, the Panel report was circulated to\n Members. The Panel found that:\nOn 1 June 2004, the United States notified its decision\n to appeal to the Appellate Body certain issues of law covered in the Panel\n Report and certain legal interpretations developed by the Panel.\nOn 30 August 2004, the Appellate Body Report was\n circulated to Members. The Appellate Body upheld the Panel’s conclusion\n that the United States had not demonstrated that the Canadian Wheat Board\n (CWB) Export Regime is inconsistent with Article XVII:1 of the GATT 1994.\n At its meeting on 27 September 2004, the DSB adopted the Appellate Body\n report and the Panel report, as modified by the Appellate Body report.\n\nImplementation of adopted reports\nAt the DSB meeting on\n 18 October 2004, Canada stated that it was the intention of Canada\n to implement the recommendations and rulings of the DSB in a manner that\n respected its WTO obligations, and that it would require a reasonable\n period of time to implement the recommendations and rulings of the DSB and\n was ready to consult with the United States in accordance with Article\n 21.3(b) of the DSU.\nOn 15 November 2004, Canada and the United States informed the DSB that\n they had agreed that the reasonable period of time shall be is\n 10 months and 5 days, that is, 27 September 2004 to 1 August 2005.\nAt the DSB meeting on 31 August 2005, Canada announced that amendments to the Canada Transportation Act and the Canada Grain Act and associated regulatory changes had come into force on 1 August 2005 thus bringing Canada into compliance with the DSB’s recommendations and rulings."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT\nAND TREATMENT OF IMPORTED GRAIN\nRequest to Join Consultations\nCommunication from the European Communities\nThe following communication, dated 20 December 2002, from the Permanent Delegation of\nthe European Commission to the Permanent Mission of Canada, the Permanent Mission of the\nUnited States and to the Chairman of the Dispute Settlement Body, is circulated in accordance with\nArticle 4.11 of the DSU.\nWe refer to the communication from the Permanent Mission of the United States addressed to\nthe Permanent Mission of Canada and to the Chairman of the Dispute Settlement Body entitled\n\" \" (WT/DS276)\nand which was circulated on 19 December 2002 in accordance with Article 4.4 of the DSU as\ndocument , and\nThe communication refers to consultations being sought with Canada pursuant to Article 4 of\nthe Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU),\nArticle XXII:1 of the General Agreement on Ta riffs and Trade 1994 (GATT 1994), and Article 8 of\nthe Agreement on Trade-Related Investment Measures (TRIMs Agreement) (to the extent it\nincorporates by reference Article XXII of the GATT 1994) with regard to matters concerning the\nexport of wheat by the Canadian Wheat Board and the treatment accorded by Canada to grain\nimported into Canada.\nIn view of the substantial trade interest of the European Communities in this matter, my\nauthorities have instructed me to notify you of the desire of the European Communities to be joined in\nthe consultations between Canada and the United States pursuant to Article 4.11 of the DSU.\nThe European Communities looks forward to receiving your reply to this request."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:58.892096"}}},{"rowIdx":4097,"cells":{"folder_number":{"kind":"string","value":"276"},"case_number":{"kind":"string","value":"276"},"original_filename":{"kind":"string","value":"DS276_SEQ05_Request_To_Join_Consultations_03.pdf"},"new_filename":{"kind":"string","value":"DS276_SEQ05_Request_To_Join_Consultations_03.pdf"},"doc_sequence":{"kind":"number","value":5,"string":"5"},"doc_type":{"kind":"string","value":"Request_To_Join_Consultations"},"doc_type_raw":{"kind":"string","value":"Request to Join Consultations Communication from Australia"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":3,"string":"3"},"case_title":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN"},"date":{"kind":"string","value":"8 January 2003"},"header_codes":{"kind":"string","value":"WT/DS276/5"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Canada']"},"third_parties":{"kind":"string","value":"['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico']"},"dispute_stage":{"kind":"string","value":"Appellate Body"},"agreements_cited":{"kind":"string","value":"Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\n\n See also: One-page summary of key findings of this dispute\nConsultations\nComplaint by the United States.\nOn 17 December 2002, the United States requested\n consultations with Canada as regards matters concerning the export of\n wheat by the Canadian Wheat Board and the treatment accorded by Canada to\n grain imported into Canada.\nAccording to the United States, the actions of the\n Government of Canada and the Canadian Wheat Board (entity enjoying\n exclusive rights to purchase and sell Western Canadian wheat for human\n consumption) related to export of wheat appear to be inconsistent with\n paragraphs 1(a) and 1(b) of Article XVII of GATT 1994.\nAs regards the treatment of grain imported into Canada,\n the United States maintains that the following Canadian measures are\n inconsistent with Article III of the GATT 1994 and Article 2 of TRIMs\n since they discriminate against imported grain:\nOn 20 December 2002, the European Communities, Japan\n and Mexico requested to join the consultations. On 24 December 2002,\n Australia requested to join the consultations. On 6 March 2003, the US\n requested the establishment of a panel. At its meeting on 18 March 2003,\n the DSB deferred the establishment of a panel.\n\nPanel and Appellate Body proceedings\nFurther to a second request\n by the US, the DSB established a Panel at its meeting on 31 March 2003.\n Chile, Chinese Taipei, the EC, Japan and Mexico reserved their third-party\n rights. On 9 and 10 April 2003 respectively, China and Australia reserved\n their third-party rights. On 2 May 2003, Canada requested the\n Director-General to compose the panel. On 12 May 2003, the\n Director-General composed the panel. On 30 June 2003, the United States\n submitted a new request for the establishment of a panel. On 1 July 2003,\n the Chair of the Panel informed the DSB that it had agreed to the United\n States’ request to suspend the Panel for three weeks from 1-21 July 2003.\n The DSB established a second panel at its meeting on 11 July 2003.\n Australia, Chile, China, the EC, Japan and Chinese Taipei reserved their\n third-party rights. On 25 July 2003, Mexico reserved its third-party\n rights. On 11 July 2003, the second Panel was composed. Further to a\n request by the United States, acceded to by the Panel, the preliminary\n ruling by the Panel was circulated to Members for their information on 21\n July 2003. On 30 October 2003, the Chairman of the Panel informed the DSB\n that the first Panel would not be able to complete its work within six\n months due to the three week suspension requested by the US following the\n issuance of a preliminary ruling by the Panel and the harmonization of\n this Panel’s timetable with that of the second Panel and that the Panel\n expected to issue its final report to the parties in February 2004.\nOn 6 April 2004, the Panel report was circulated to\n Members. The Panel found that:\nOn 1 June 2004, the United States notified its decision\n to appeal to the Appellate Body certain issues of law covered in the Panel\n Report and certain legal interpretations developed by the Panel.\nOn 30 August 2004, the Appellate Body Report was\n circulated to Members. The Appellate Body upheld the Panel’s conclusion\n that the United States had not demonstrated that the Canadian Wheat Board\n (CWB) Export Regime is inconsistent with Article XVII:1 of the GATT 1994.\n At its meeting on 27 September 2004, the DSB adopted the Appellate Body\n report and the Panel report, as modified by the Appellate Body report.\n\nImplementation of adopted reports\nAt the DSB meeting on\n 18 October 2004, Canada stated that it was the intention of Canada\n to implement the recommendations and rulings of the DSB in a manner that\n respected its WTO obligations, and that it would require a reasonable\n period of time to implement the recommendations and rulings of the DSB and\n was ready to consult with the United States in accordance with Article\n 21.3(b) of the DSU.\nOn 15 November 2004, Canada and the United States informed the DSB that\n they had agreed that the reasonable period of time shall be is\n 10 months and 5 days, that is, 27 September 2004 to 1 August 2005.\nAt the DSB meeting on 31 August 2005, Canada announced that amendments to the Canada Transportation Act and the Canada Grain Act and associated regulatory changes had come into force on 1 August 2005 thus bringing Canada into compliance with the DSB’s recommendations and rulings."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT\nAND TREATMENT OF IMPORTED GRAIN\nRequest to Join Consultations\nCommunication from Australia\nThe following communication, dated 24 December 2002, from the Permanent Mission of\nAustralia to the Permanent Mission of Canada, the Permanent Mission of the United States and to the\nChairman of the Dispute Settlement Body, is circulated in accordance with Article 4.11 of the DSU.\nI refer to the \"Request for Consultations by the United States\" with regard to matters\nconcerning the export of wheat by the Canadian Wheat Board and the treatment accorded by Canada\nto grain imported into Canada, made on 17 December 2002 pursuant to Article 4 of the\nUnderstanding on Rules and Procedures Governing the Settlement of Disputes (DSU), Article XXII:1\nof the General Agreement on Tariffs and Trade 1994 , and Article 8 of the Agreement on\nTrade-Related Investment Measures , which was circulated to Members on 19 December 2002\n(, and refer).\nAustralia is a significant exporter of wheat and, as such, has a substantial trade interest in the\nconsultations requested by the United States.\nDue to our substantial trade interest in the above-mentioned consultations, the Government of\nAustralia hereby notifies, pursuant to paragraph 11 of Article 4 of the DSU, its desire to be joined in\nthe consultations.\nI would be grateful for your early positive response."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:58.892524"}}},{"rowIdx":4098,"cells":{"folder_number":{"kind":"string","value":"276"},"case_number":{"kind":"string","value":"276"},"original_filename":{"kind":"string","value":"DS276_SEQ06_Request_For_Establishment_Of_Panel_00.pdf"},"new_filename":{"kind":"string","value":"DS276_SEQ06_Request_For_Establishment_Of_Panel_00.pdf"},"doc_sequence":{"kind":"number","value":6,"string":"6"},"doc_type":{"kind":"string","value":"Request_For_Establishment_Of_Panel"},"doc_type_raw":{"kind":"string","value":"Request for the Establishment of a Panel by the United States"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":0,"string":"0"},"case_title":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN"},"date":{"kind":"string","value":"7 March 2003"},"header_codes":{"kind":"string","value":"WT/DS276/6"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Canada']"},"third_parties":{"kind":"string","value":"['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico']"},"dispute_stage":{"kind":"string","value":"Appellate Body"},"agreements_cited":{"kind":"string","value":"Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\n\n See also: One-page summary of key findings of this dispute\nConsultations\nComplaint by the United States.\nOn 17 December 2002, the United States requested\n consultations with Canada as regards matters concerning the export of\n wheat by the Canadian Wheat Board and the treatment accorded by Canada to\n grain imported into Canada.\nAccording to the United States, the actions of the\n Government of Canada and the Canadian Wheat Board (entity enjoying\n exclusive rights to purchase and sell Western Canadian wheat for human\n consumption) related to export of wheat appear to be inconsistent with\n paragraphs 1(a) and 1(b) of Article XVII of GATT 1994.\nAs regards the treatment of grain imported into Canada,\n the United States maintains that the following Canadian measures are\n inconsistent with Article III of the GATT 1994 and Article 2 of TRIMs\n since they discriminate against imported grain:\nOn 20 December 2002, the European Communities, Japan\n and Mexico requested to join the consultations. On 24 December 2002,\n Australia requested to join the consultations. On 6 March 2003, the US\n requested the establishment of a panel. At its meeting on 18 March 2003,\n the DSB deferred the establishment of a panel.\n\nPanel and Appellate Body proceedings\nFurther to a second request\n by the US, the DSB established a Panel at its meeting on 31 March 2003.\n Chile, Chinese Taipei, the EC, Japan and Mexico reserved their third-party\n rights. On 9 and 10 April 2003 respectively, China and Australia reserved\n their third-party rights. On 2 May 2003, Canada requested the\n Director-General to compose the panel. On 12 May 2003, the\n Director-General composed the panel. On 30 June 2003, the United States\n submitted a new request for the establishment of a panel. On 1 July 2003,\n the Chair of the Panel informed the DSB that it had agreed to the United\n States’ request to suspend the Panel for three weeks from 1-21 July 2003.\n The DSB established a second panel at its meeting on 11 July 2003.\n Australia, Chile, China, the EC, Japan and Chinese Taipei reserved their\n third-party rights. On 25 July 2003, Mexico reserved its third-party\n rights. On 11 July 2003, the second Panel was composed. Further to a\n request by the United States, acceded to by the Panel, the preliminary\n ruling by the Panel was circulated to Members for their information on 21\n July 2003. On 30 October 2003, the Chairman of the Panel informed the DSB\n that the first Panel would not be able to complete its work within six\n months due to the three week suspension requested by the US following the\n issuance of a preliminary ruling by the Panel and the harmonization of\n this Panel’s timetable with that of the second Panel and that the Panel\n expected to issue its final report to the parties in February 2004.\nOn 6 April 2004, the Panel report was circulated to\n Members. The Panel found that:\nOn 1 June 2004, the United States notified its decision\n to appeal to the Appellate Body certain issues of law covered in the Panel\n Report and certain legal interpretations developed by the Panel.\nOn 30 August 2004, the Appellate Body Report was\n circulated to Members. The Appellate Body upheld the Panel’s conclusion\n that the United States had not demonstrated that the Canadian Wheat Board\n (CWB) Export Regime is inconsistent with Article XVII:1 of the GATT 1994.\n At its meeting on 27 September 2004, the DSB adopted the Appellate Body\n report and the Panel report, as modified by the Appellate Body report.\n\nImplementation of adopted reports\nAt the DSB meeting on\n 18 October 2004, Canada stated that it was the intention of Canada\n to implement the recommendations and rulings of the DSB in a manner that\n respected its WTO obligations, and that it would require a reasonable\n period of time to implement the recommendations and rulings of the DSB and\n was ready to consult with the United States in accordance with Article\n 21.3(b) of the DSU.\nOn 15 November 2004, Canada and the United States informed the DSB that\n they had agreed that the reasonable period of time shall be is\n 10 months and 5 days, that is, 27 September 2004 to 1 August 2005.\nAt the DSB meeting on 31 August 2005, Canada announced that amendments to the Canada Transportation Act and the Canada Grain Act and associated regulatory changes had come into force on 1 August 2005 thus bringing Canada into compliance with the DSB’s recommendations and rulings."},"page_count":{"kind":"number","value":2,"string":"2"},"clean_text":{"kind":"string","value":"CANADA – MEASURES RELATING TO EXPORTS OF WHEAT\nAND TREATMENT OF IMPORTED GRAIN\nRequest for the Establishment of a Panel by the United States\nThe following communication, dated 6 March 2003, from the Permanent Mission of the\nUnited States to the Chairman of the Dispute Settlement Body, is circulated pursuant to Article 6.2 of\nthe DSU.\nThe United States considers that certain measures of the Government of Canada are\ninconsistent with Canada's obligations under the General Agreement on Tariffs and Trade 1994\n(\"GATT 1994\") and the Agreement on Trade-Related Investment Measures (\"TRIMs Agreement\").\n(1) The Government of Canada has establishe d the Canadian Wheat Board (\"CWB\"), and has\ngranted to this enterprise exclusive and special privileges. These exclusive and special privileges\ninclude the exclusive right to purchase western Canadian wheat for export and domestic human\nconsumption at a price determined by the Government of Canada and the CWB; the exclusive right to\nsell western Canadian wheat for export and domestic human consumption; and government\nguarantees of the CWB's financial operations, including the CWB's borrowing, the CWB's credit sales\nto foreign buyers, and the CWB's initial payments to farmers.\nThe laws, regulations and actions of the Government of Canada and the CWB appear to be\ninconsistent with the obligations of the Government of Canada under Article XVII of the GATT 1994.\nIn particular, the laws, regulations and actions of the Government of Canada and the CWB related to\nexports of wheat appear to be:\n• inconsistent with paragraph 1(a) of Article XVII of the GATT 1994, pursuant to which the\nGovernment of Canada has undertaken that the CWB, in its purchases or sales involving\nwheat exports, shall act in a manner consistent with the general principles of non-\ndiscriminatory treatment prescribed in the GATT 1994; and\n• inconsistent with paragraph 1(b) of Article XVII of the GATT 1994, pursuant to which the\nGovernment of Canada has undertaken that the CWB shall make such purchases or sales\nsolely in accordance with commercial considera tions and shall afford the enterprises of other\nWTO Members adequate opportunity, in accordance with customary business practice, to\ncompete for such purchases or sales.\nThe apparent inconsistency with Canada's obligations under Article XVII of the GATT 1994 includes\nthe failure of the Government of Canada to ensure that the CWB makes such purchases or sales in\naccordance with the requirements set forth in paragraphs 1(a) and 1(b) of Article XVII.\n\n(2) With regard to the treatment of grain that is imported into Canada, Canadian measures\ndiscriminate against imported grain, including grain that is the product of the United States:\n• Under the Canada Grain Act and Canadian grain regulations, imported grain must be\nsegregated from Canadian domestic grain throughout the Canadian grain handling system;\nimported grain may not be received into grain elevators; and imported grain may not be\nmixed with Canadian domestic grain being received into, or being discharged out of, grain\nelevators. These measures accord to imported grain less favorable treatment than that\naccorded to like Canadian grain, and thus appear to be inconsistent with the obligations of\nCanada under Article III:4 of the GATT 1994 and Article 2 of the TRIMs Agreement.\n• Canadian law caps the maximum revenues that railroads may receive on the shipment of\nCanadian domestic grain, but not revenues that railroads may receive on the shipment of\nimported grain. In addition, in allocating railcars used for the transport of grain, Canada\nprovides a preference for domestic grain over imported grain. These measures concerning\nrail transportation accord to imported grain less favorable treatment than that accorded to like\ndomestic grain, and thus appear to be inconsistent with the obligations of Canada under\nArticle III:4 of the GATT 1994 and Article 2 of the TRIMs Agreement.\nOn 17 December 2002, the United States Government requested consultations with the\nGovernment of Canada pursuant to Article 4 of the Understanding on Rules and Procedures\nGoverning the Settlement of Disputes (\"DSU\"), Article XXII:1 of the GATT 1994, and Article 8 of\nthe TRIMs Agreement (to the extent it incorporates by reference Article XXII of the GATT 1994).\nThe United States and Canada held such consultations on 31 January 2003. The consultations did not\nresolve the dispute.\nAccordingly, the United States respectfully requests the Dispute Settlement Body to establish\na panel pursuant to Article 6 of the DSU to examine this matter with the standard terms of reference\nas set out in Article 7.1 of the DSU. The United States further asks that this request for a panel be\nplaced on the agenda for the next meeting of the Dispute Settlement Body to be held on\n18 March 2003."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:58.893482"}}},{"rowIdx":4099,"cells":{"folder_number":{"kind":"string","value":"276"},"case_number":{"kind":"string","value":"276"},"original_filename":{"kind":"string","value":"DS276_SEQ07_Note_By_Secretariat_00.pdf"},"new_filename":{"kind":"string","value":"DS276_SEQ07_Note_By_Secretariat_00.pdf"},"doc_sequence":{"kind":"number","value":7,"string":"7"},"doc_type":{"kind":"string","value":"Note_By_Secretariat"},"doc_type_raw":{"kind":"string","value":"Constitution of the Panel Established at the Request of the United States Note by the Secretariat"},"doc_class":{"kind":"string","value":"NUMBERED"},"variant":{"kind":"null"},"part_number":{"kind":"number","value":0,"string":"0"},"case_title":{"kind":"string","value":"CANADA - MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN"},"date":{"kind":"string","value":"13 May 2003"},"header_codes":{"kind":"string","value":"WT/DS276/7; WT/DS276/6; WT/DS276/6"},"agreement_indicators":{"kind":"string","value":""},"complainant":{"kind":"string","value":"['U.S.']"},"respondent":{"kind":"string","value":"['Canada']"},"third_parties":{"kind":"string","value":"['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico']"},"dispute_stage":{"kind":"string","value":"Appellate Body"},"agreements_cited":{"kind":"string","value":"Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs)"},"case_summary":{"kind":"string","value":"The summary below was up-to-date at\n 24 February 2010\n\n See also: One-page summary of key findings of this dispute\nConsultations\nComplaint by the United States.\nOn 17 December 2002, the United States requested\n consultations with Canada as regards matters concerning the export of\n wheat by the Canadian Wheat Board and the treatment accorded by Canada to\n grain imported into Canada.\nAccording to the United States, the actions of the\n Government of Canada and the Canadian Wheat Board (entity enjoying\n exclusive rights to purchase and sell Western Canadian wheat for human\n consumption) related to export of wheat appear to be inconsistent with\n paragraphs 1(a) and 1(b) of Article XVII of GATT 1994.\nAs regards the treatment of grain imported into Canada,\n the United States maintains that the following Canadian measures are\n inconsistent with Article III of the GATT 1994 and Article 2 of TRIMs\n since they discriminate against imported grain:\nOn 20 December 2002, the European Communities, Japan\n and Mexico requested to join the consultations. On 24 December 2002,\n Australia requested to join the consultations. On 6 March 2003, the US\n requested the establishment of a panel. At its meeting on 18 March 2003,\n the DSB deferred the establishment of a panel.\n\nPanel and Appellate Body proceedings\nFurther to a second request\n by the US, the DSB established a Panel at its meeting on 31 March 2003.\n Chile, Chinese Taipei, the EC, Japan and Mexico reserved their third-party\n rights. On 9 and 10 April 2003 respectively, China and Australia reserved\n their third-party rights. On 2 May 2003, Canada requested the\n Director-General to compose the panel. On 12 May 2003, the\n Director-General composed the panel. On 30 June 2003, the United States\n submitted a new request for the establishment of a panel. On 1 July 2003,\n the Chair of the Panel informed the DSB that it had agreed to the United\n States’ request to suspend the Panel for three weeks from 1-21 July 2003.\n The DSB established a second panel at its meeting on 11 July 2003.\n Australia, Chile, China, the EC, Japan and Chinese Taipei reserved their\n third-party rights. On 25 July 2003, Mexico reserved its third-party\n rights. On 11 July 2003, the second Panel was composed. Further to a\n request by the United States, acceded to by the Panel, the preliminary\n ruling by the Panel was circulated to Members for their information on 21\n July 2003. On 30 October 2003, the Chairman of the Panel informed the DSB\n that the first Panel would not be able to complete its work within six\n months due to the three week suspension requested by the US following the\n issuance of a preliminary ruling by the Panel and the harmonization of\n this Panel’s timetable with that of the second Panel and that the Panel\n expected to issue its final report to the parties in February 2004.\nOn 6 April 2004, the Panel report was circulated to\n Members. The Panel found that:\nOn 1 June 2004, the United States notified its decision\n to appeal to the Appellate Body certain issues of law covered in the Panel\n Report and certain legal interpretations developed by the Panel.\nOn 30 August 2004, the Appellate Body Report was\n circulated to Members. The Appellate Body upheld the Panel’s conclusion\n that the United States had not demonstrated that the Canadian Wheat Board\n (CWB) Export Regime is inconsistent with Article XVII:1 of the GATT 1994.\n At its meeting on 27 September 2004, the DSB adopted the Appellate Body\n report and the Panel report, as modified by the Appellate Body report.\n\nImplementation of adopted reports\nAt the DSB meeting on\n 18 October 2004, Canada stated that it was the intention of Canada\n to implement the recommendations and rulings of the DSB in a manner that\n respected its WTO obligations, and that it would require a reasonable\n period of time to implement the recommendations and rulings of the DSB and\n was ready to consult with the United States in accordance with Article\n 21.3(b) of the DSU.\nOn 15 November 2004, Canada and the United States informed the DSB that\n they had agreed that the reasonable period of time shall be is\n 10 months and 5 days, that is, 27 September 2004 to 1 August 2005.\nAt the DSB meeting on 31 August 2005, Canada announced that amendments to the Canada Transportation Act and the Canada Grain Act and associated regulatory changes had come into force on 1 August 2005 thus bringing Canada into compliance with the DSB’s recommendations and rulings."},"page_count":{"kind":"number","value":1,"string":"1"},"clean_text":{"kind":"string","value":"CANADA - MEASURES RELATING TO EXPORTS OF WHEAT\nAND TREATMENT OF IMPORTED GRAIN\nConstitution of the Panel Established at the Request of the United States\nNote by the Secretariat\n1. At its meeting on 31 March 2003 (WT/DSB/M/ 146), the Dispute Settlement Body (DSB)\nestablished a panel pursuant to the request made by the United States in document , in\naccordance with Article 6 of the Dispute Settlement Understanding (DSU).\n2. At that meeting, the parties to the dispute also agreed that the panel should have standard\nterms of reference. The terms of reference Panel are the following:\n\"To examine, in the light of the relevant provisions of the covered agreements cited\nby the United States in document , the matter referred to the DSB by the\nUnited States in that document and to make such findings as will assist the DSB in\nmaking the recommendations or in giving the rulings provided for in those\nagreements.\"\n3. On 2 May 2003, Canada requested the Director-General to determine the composition of the\nPanel, pursuant to paragraph 7 of Article 8 of the DSU. This paragraph provides:\n\"If there is no agreement on the panelists within 20 days after the date of the\nestablishment of a panel, at the request of either party, the Director-General, in\nconsultation with the Chairman of the DSB and the Chairman of the relevant Council\nor Committee, shall determine the composition of the panel by appointing the\npanelists whom the Director-General considers most appropriate in accordance with\nany relevant special or additional rules or procedures of the covered agreement or\ncovered agreements which are at issue in the dispute, after consulting with the parties\nto the dispute. The Chairman of the DSB shall inform the Members of the\ncomposition of the panel thus formed no later than 10 days after the date the\nChairman receives such a request.\"\n4. On 12 May 2003, the Director-General composed the Panel as follows:\nChairperson: Ms. Claudia Orozco\nMembers: Mr. Alan Matthews\nMr. Hanspeter Tschäni\n5. Australia, Chile, China, the European Communities, Japan, Mexico and Chinese Taipei have\nreserved their third party rights to participate in the Panel's proceedings."},"processing_date":{"kind":"string","value":"2026-03-15T15:46:58.894118"}}}],"truncated":false,"partial":false},"paginationData":{"pageIndex":40,"numItemsPerPage":100,"numTotalItems":9414,"offset":4000,"length":100}},"jwt":"eyJhbGciOiJFZERTQSJ9.eyJyZWFkIjp0cnVlLCJwZXJtaXNzaW9ucyI6eyJyZXBvLmNvbnRlbnQucmVhZCI6dHJ1ZX0sImlhdCI6MTc3OTcxMTQ4NCwic3ViIjoiL2RhdGFzZXRzL2RlYW4yMjAyOS9XVE9fRG9jcyIsImV4cCI6MTc3OTcxNTA4NCwiaXNzIjoiaHR0cHM6Ly9odWdnaW5nZmFjZS5jbyJ9.XLa8qKbDbk5o8Whou9jEvOnAVH_8t_r2UBMXR7aRLMEiANdj2Gqx_WW0QVR8ox0dP0x-19GpEKr2LhG2VwkODg","displayUrls":true,"splitSizeSummaries":[{"config":"default","split":"train","numRows":9414,"numBytesParquet":235278256}]},"discussionsStats":{"closed":0,"open":1,"total":1},"fullWidth":true,"hasGatedAccess":true,"hasFullAccess":true,"isEmbedded":false,"savedQueries":{"community":[],"user":[]}}">
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|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
268 | 268 | DS268_SEQ19_Note_By_Secretariat_03.pdf | DS268_SEQ19_Note_By_Secretariat_03.pdf | 19 | Note_By_Secretariat | Recourse by the United States to Article 22.6 of the DSU Constitution of the Arbitrator Note by the Secretariat | NUMBERED | null | 3 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 26 June 2007 | WT/DS268/26 | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 1 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Recourse by the United States to Article 22.6 of the DSU
Constitution of the Arbitrator
Note by the Secretariat
1. At its meeting on 4 June 2007, the Dispute Settlement Body (DSB) agreed that the matter
raised by the... | 2026-03-15T15:46:47.017072 | |
268 | 268 | DS268_SEQ20_Communication_06.pdf | DS268_SEQ20_Communication_06.pdf | 20 | Communication | Recourse by the United States to Article 22.6 of the DSU Communication from the Arbitrator | NUMBERED | null | 6 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 26 June 2007 | WT/DS268/27 | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 1 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Recourse by the United States to Article 22.6 of the DSU
Communication from the Arbitrator
The following communication, dated 21 June 2007, has been received from the Delegation of
Argentina and the Delegation of the... | 2026-03-15T15:46:47.017706 | |
268 | 268 | DS268_SEQ21_Submission_01.pdf | DS268_SEQ21_Submission_01.pdf | 21 | Submission | WT/DS268/R Page A-1 ANNEX A FIRST WRITTEN SUBMISSIONS BY THE PARTIES Contents Page Annex A-1 First Written Submission of Argentina 1 A-2 Annex A-2 First Written Submission of the United States A-87 | NUMBERED | null | 1 | 12 December 2003 | WT/DS268/R | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 199 | ANNEX A
FIRST WRITTEN SUBMISSIONS BY THE PARTIES
Contents Page
Annex A-1 First Written Submission of Argentina 1 A-2
Annex A-2 First Written Submission of the United States A-87
Annex A-3 Submission from Argentina on the Request by the United States for
Preliminary Rulings under Article 6.2 of the DSU
A-175
B. BURD... | 2026-03-15T15:46:47.164890 | ||
268 | 268 | DS268_SEQ22_Submission_02.pdf | DS268_SEQ22_Submission_02.pdf | 22 | Submission | WT/DS268/R Page B-1 ANNEX B THIRD PARTIES' SUBMISSIONS Contents Page Annex B-1 Third Party Submission of the European Communities B-2 Annex B-2 Third Party Submission of Japan B-31 | NUMBERED | null | 2 | null | WT/DS268/R | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 60 | ANNEX B
THIRD PARTIES' SUBMISSIONS
Contents Page
Annex B-1 Third Party Submission of the European Communities B-2
Annex B-2 Third Party Submission of Japan B-31
Annex B-3 Third Party Submission of Korea B-47
Annex B-4 Third Party Submission of the Separate Customs Territory of
Taiwan, Penghu, Kinmen and Matsu
B-56
... | 2026-03-15T15:46:47.203890 | ||
268 | 268 | DS268_SEQ23_Submission_03.pdf | DS268_SEQ23_Submission_03.pdf | 23 | Submission | WT/DS268/R Page C-1 ANNEX C SECOND WRITTEN SUBMISSIONS BY THE PARTIES Contents Page Annex C-1 Second Written Submission of Argentina C-2 Annex C-2 Second Written Submission of the United States C-64 | NUMBERED | null | 3 | null | WT/DS268/R | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 80 | ANNEX C
SECOND WRITTEN SUBMISSIONS BY THE PARTIES
Contents Page
Annex C-1 Second Written Submission of Argentina C-2
Annex C-2 Second Written Submission of the United States C-64
I. INTRODUCTION
1. On 15 December 2003, the Appellate Body confirmed in Sunset Review of Steel from Japan
that Article 11.3 of the Anti-Du... | 2026-03-15T15:46:47.268582 | ||
268 | 268 | DS268_SEQ24_Submission_04.pdf | DS268_SEQ24_Submission_04.pdf | 24 | Submission | WT/DS268/R Page D-1 ANNEX D ORAL STATEMENTS, FIRST AND SECOND MEETINGS Contents Page Annex D-1 Opening and Closing Oral Statements of Argentina – First Meeting D-2 Annex D-2 Oral Statement of the United States – First Meeting D-38 | NUMBERED | null | 4 | null | WT/DS268/R | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 96 | ANNEX D
ORAL STATEMENTS, FIRST AND SECOND MEETINGS
Contents Page
Annex D-1 Opening and Closing Oral Statements of Argentina – First Meeting D-2
Annex D-2 Oral Statement of the United States – First Meeting D-38
Annex D-3 Third Party Oral Statement of the European Communities D-46
Annex D-4 Third Party Oral Statement ... | 2026-03-15T15:46:47.329051 | ||
268 | 268 | DS268_SEQ25_Questions_And_Replies_05.pdf | DS268_SEQ25_Questions_And_Replies_05.pdf | 25 | Questions_And_Replies | WT/DS268/R Page E-1 ANNEX E QUESTIONS AND ANSWERS Contents Page Annex E-1 Answers of Argentina to Questions of the Panel – First Meeting E-2 Annex E-2 Answers of the United States to Questions of the Panel – First Meeting E-18 Annex E-3 Answers of the United States to Questions of the Panel – First | NUMBERED | null | 5 | 8 January 2004 | WT/DS268/R | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 136 | ANNEX E
QUESTIONS AND ANSWERS
Contents Page
Annex E-1 Answers of Argentina to Questions of the Panel – First Meeting E-2
Annex E-2 Answers of the United States to Questions of the Panel – First
Meeting
E-18
Annex E-3 Answers of the United States to Questions of the Panel – First
Meeting (revised version)1
E-43
Annex ... | 2026-03-15T15:46:47.419070 | ||
268 | 268 | DS268_SEQ26_Request_For_Establishment_Of_Panel_06.pdf | DS268_SEQ26_Request_For_Establishment_Of_Panel_06.pdf | 26 | Request_For_Establishment_Of_Panel | Request for the Establishment of a Panel by Argentina | NUMBERED | null | 6 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 4 April 2003 | WT/DS268/R; WT/DS268/2 | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 5 | ANNEX F
REQUEST FOR THE ESTABLISHMENT
OF A PANEL
UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Request for the Establishment of a Panel by Argentina
The following communication, dated 3 April 2003, from the Permanent Mission of Argentina
to the Chairman of the ... | 2026-03-15T15:46:47.422064 | |
268 | 268 | DS268_SEQ27_Submission_01.pdf | DS268_SEQ27_Submission_01.pdf | 27 | Submission | WT/DS268/RW Page A-1 ANNEX A FIRST WRITTEN SUBMISSIONS OF PARTIES Contents Page Annex A-1 First Written Submission of Argentina A-2 Annex A-2 First Written Submission of the United States A-58 | NUMBERED | null | 1 | null | WT/DS268/RW | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 77 | ANNEX A
FIRST WRITTEN SUBMISSIONS OF PARTIES
Contents Page
Annex A-1 First Written Submission of Argentina A-2
Annex A-2 First Written Submission of the United States A-58
I. INTRODUCTION
1. This dispute raises fundamental questions a bout the enforceability of a key discipline of the
Anti-Dumping Agreement: the "s... | 2026-03-15T15:46:47.485014 | ||
268 | 268 | DS268_SEQ28_Submission_03.pdf | DS268_SEQ28_Submission_03.pdf | 28 | Submission | WT/DS268/RW Page C-1 ANNEX C SECOND WRITTEN SUBMISSIONS OF PARTIES Contents Page Annex C-1 Second Written Submission of Argentina C-2 | NUMBERED | null | 3 | null | WT/DS268/RW | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 71 | ANNEX C
SECOND WRITTEN SUBMISSIONS OF PARTIES
Contents Page
Annex C-1 Second Written Submission of Argentina C-2
Annex C-2 Second Written Submission of the United States C-47
I. INTRODUCTION
1. In its First Submission, the United States repeats some familiar themes from the original
Panel proceeding to defend its p... | 2026-03-15T15:46:47.535071 | ||
268 | 268 | DS268_SEQ29_Submission_04.pdf | DS268_SEQ29_Submission_04.pdf | 29 | Submission | WT/DS268/RW Page D-1 ANNEX D ORAL STATEMENTS, SUBSTANTIVE MEETING OF THE PANEL WITH PARTIES AND THIRD PARTIES Contents Page | NUMBERED | null | 4 | null | WT/DS268/RW | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 44 | ANNEX D
ORAL STATEMENTS, SUBSTANTIVE MEETING OF THE PANEL
WITH PARTIES AND THIRD PARTIES
Contents Page
Annex D-1 Opening Oral Statement of Argentina
Closing Oral Statement of Argentina
D-2
D-20
Annex D-2 Opening Oral Statement of the United States
Closing Oral Statement of the United States
D-23
D-27
Annex D-3 Thir... | 2026-03-15T15:46:47.562082 | ||
268 | 268 | DS268_SEQ30_Questions_And_Replies_05.pdf | DS268_SEQ30_Questions_And_Replies_05.pdf | 30 | Questions_And_Replies | WT/DS268/RW Page E-1 ANNEX E QUESTIONS AND ANSWERS Contents Page Annex E-1 Answers of Argentina to Questions of the Panel E-2 Annex E-2 Answers of the United States to Questions of the Panel E-55 Annex E-3 Comments of Argentina on the United States' Written Answers to Questions from the Panel to the Parties E-83 | NUMBERED | null | 5 | null | WT/DS268/RW | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 143 | ANNEX E
QUESTIONS AND ANSWERS
Contents Page
Annex E-1 Answers of Argentina to Questions of the Panel E-2
Annex E-2 Answers of the United States to Questions of the Panel E-55
Annex E-3 Comments of Argentina on the United States' Written Answers to
Questions from the Panel to the Parties E-83
Annex E-4 Comments of th... | 2026-03-15T15:46:47.657435 | ||
268 | 268 | DS268_SEQ31_Request_For_Establishment_Of_Panel_06.pdf | DS268_SEQ31_Request_For_Establishment_Of_Panel_06.pdf | 31 | Request_For_Establishment_Of_Panel | WT/DS268/RW Page F-1 ANNEX F REQUEST FOR THE ESTABLISHMENT OF A PANEL Contents Page Annex F Request for the Establishment of a Panel – Document WT/DS268/16 F-2 | NUMBERED | null | 6 | null | WT/DS268/RW; WT/DS268/16 | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 8 | ANNEX F
REQUEST FOR THE ESTABLISHMENT
OF A PANEL
Contents Page
Annex F Request for the Establishment of a Panel – Document F-2
ANNEX F
REQUEST FOR THE ESTABLISHMENT
OF A PANEL
UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Recourse to Article 21.5 of the DSU by... | 2026-03-15T15:46:47.661520 | ||
268 | 268 | DS268_SEQ32_Report_Of_Panel_00.pdf | DS268_SEQ32_Report_Of_Panel_00.pdf | 32 | Report_Of_Panel | Report of the Panel | PANEL_REPORT | null | 0 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA (DS268) | 16 July 2004 | WT/DS268/R | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 92 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING
MEASURES ON OIL COUNTRY TUBULAR GOODS FROM
ARGENTINA (DS268)
Report of the Panel
I. INTRODUCTION
1.1 On 7 October 2002, the Government of the Re public of Argentina requested consultations
with the Government of the United States of Am erica pursuant to Article 4 of the... | 2026-03-15T15:46:47.716913 | |
268 | 268 | DS268_SEQ33_Report_Of_Panel_Corr.pdf | DS268_SEQ33_Report_Of_Panel_Corr.pdf | 33 | Report_Of_Panel | Report of the Panel Corrigendum Annex A Page A31 The last two sentences of paragraph 92, from "As will be ..." shoul d be renumbered as paragraph 93. | PANEL_REPORT | Corr | null | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 16 July 2004 | WT/DS268/R/Corr.1 | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 1 | UNITED STATES – SUNSET REVIEWS OF
ANTI-DUMPING MEASURES ON OIL COUNTRY
TUBULAR GOODS FROM ARGENTINA
Report of the Panel
Corrigendum
Annex A
The last two sentences of paragraph 92, from "As will be ..." shoul d be renumbered as
paragraph 93.
The last two sentences of paragraph 144, from "With regard to the ..." s... | 2026-03-15T15:46:47.717439 | |
268 | 268 | DS268_SEQ34_Report_Of_Panel_00.pdf | DS268_SEQ34_Report_Of_Panel_00.pdf | 34 | Report_Of_Panel | Recourse to Article 21.5 of the DSU by ARGENTINA Report of the Panel | PANEL_REPORT | null | 0 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 30 November 2006 | WT/DS268/RW | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 57 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING
MEASURES ON OIL COUNTRY TUBULAR GOODS
FROM ARGENTINA
Recourse to Article 21.5 of the DSU by ARGENTINA
Report of the Panel
I. INTRODUCTION
1.1 On 26 January 2006, Argentina requested the establishment of a panel pursuant to
Article 21.5 of the Understanding on Rules and ... | 2026-03-15T15:46:47.752386 | |
268 | 268 | DS268_SEQ35_Report_Of_Panel_02.pdf | DS268_SEQ35_Report_Of_Panel_02.pdf | 35 | Report_Of_Panel | WT/DS268/RW Page B-1 ANNEX B WRITTEN SUBMISSIONS OF THIRD PARTIES Contents Page Annex B-1 Third Party Written Submission of China, People's Republic of B-2 Annex B-2 Third Party Written Submissi on of the European Communities B-10 Annex B-3 Third Party Written Submission of Japan B-16 Annex B-4 Third Party Written Subm... | PANEL_REPORT | null | 2 | null | WT/DS268/RW | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 32 | ANNEX B
WRITTEN SUBMISSIONS OF THIRD PARTIES
Contents Page
Annex B-1 Third Party Written Submission of China, People's Republic of B-2
Annex B-2 Third Party Written Submissi on of the European Communities B-10
Annex B-3 Third Party Written Submission of Japan B-16
Annex B-4 Third Party Written Submi ssion of Korea, R... | 2026-03-15T15:46:47.769433 | ||
268 | 268 | DS268_SEQ36_Appellate_Body_Report_And_Panel_Report_00.pdf | DS268_SEQ36_Appellate_Body_Report_And_Panel_Report_00.pdf | 36 | Appellate_Body_Report_And_Panel_Report | Appellate Body Report and Panel Report Action by the Dispute Settlement Body | AB_REPORT | null | 0 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 21 December 2004 | WT/DS268/8; WT/DS268/AB/R; WT/DS268/R | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 1 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Appellate Body Report and Panel Report
Action by the Dispute Settlement Body
At its meeting on 17 December 2004, the Dis pute Settlement Body adopted the Appellate
Body report on () and the Panel report ( and Corr.1)... | 2026-03-15T15:46:47.770063 | |
268 | 268 | DS268_SEQ37_Appellate_Body_Report_And_Panel_Report_01.pdf | DS268_SEQ37_Appellate_Body_Report_And_Panel_Report_01.pdf | 37 | Appellate_Body_Report_And_Panel_Report | Appellate Body Report and Panel Report pursuant to Article 21.5 of the DSU Action by the Dispute Settlement Body | AB_REPORT | null | 1 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 18 May 2007 | WT/DS268/23; WT/DS268/AB/RW; WT/DS268/RW | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 1 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Appellate Body Report and Panel Report pursuant to Article 21.5 of the DSU
Action by the Dispute Settlement Body
At its meeting on 11 May 2007, the Dispute Se ttlement Body adopted the Appellate Body
report on : Recour... | 2026-03-15T15:46:47.770638 | |
268 | 268 | DS268_SEQ38_Report_Of_Appellate_Body.pdf | DS268_SEQ38_Report_Of_Appellate_Body.pdf | 38 | Report_Of_Appellate_Body | Report of the Appellate Body | AB_REPORT | null | null | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 29 November 2004 | WT/DS268/AB/R | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 151 | UNITED STATES – SUNSET REVIEWS OF
ANTI-DUMPING MEASURES ON OIL COUNTRY
TUBULAR GOODS FROM ARGENTINA
AB-2004-4
Report of the Appellate Body
APPELLATE BODY
United States, Appellant/Appellee
Argentina, Appellant/Appellee
European Communities, Third Participant
Japan, Third Participant
Korea, Third Participant
Mexico,... | 2026-03-15T15:46:47.863156 | |
268 | 268 | DS268_SEQ39_Recourse_00.pdf | DS268_SEQ39_Recourse_00.pdf | 39 | Recourse | Recourse to Article 21.5 of the DSU by Argentina Notification of an Other Appeal by Argentina under Article 16.4 and Article 17 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), and under Rule 23(1) of the Working Procedures for Appellate Review | RECOURSE | null | 0 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 26 January 2007 | WT/DS268/20 | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 2 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Recourse to Article 21.5 of the DSU by Argentina
Notification of an Other Appeal by Argentina
under Article 16.4 and Article 17 of the Understanding on Rules
and Procedures Governing the Settlement of Disputes (DSU),
a... | 2026-03-15T15:46:47.865631 | |
268 | 268 | DS268_SEQ40_Recourse_01.pdf | DS268_SEQ40_Recourse_01.pdf | 40 | Recourse | Recourse by Argentina to Article 22.2 of the DSU | RECOURSE | null | 1 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 25 May 2007 | WT/DS268/24 | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 4 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Recourse by Argentina to Article 22.2 of the DSU
The following communication, dated 21 May 2007, from the delegation of Argentina to the
Chairman of the Dispute Settlement Body, is circulated pursuant to Article 22.2 ... | 2026-03-15T15:46:47.912332 | |
268 | 268 | DS268_SEQ41_Recourse_02.pdf | DS268_SEQ41_Recourse_02.pdf | 41 | Recourse | RECOURSE TO ARTICLE 21.5 OF THE DSU BY ARGENTINA AB-2007-1 | RECOURSE | null | 2 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 12 April 2007 | WT/DS268/AB/RW | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 91 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON
OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
RECOURSE TO ARTICLE 21.5 OF THE DSU BY ARGENTINA
AB-2007-1
Report of the Appellate Body
APPELLATE BODY
Recourse to Article 21.5 of the DSU by Argentina
United States, Appellant/Appellee
Argentina, Other Appellant/A... | 2026-03-15T15:46:47.968246 | |
268 | 268 | DS268_SEQ42_Request_For_Arbitration_00.pdf | DS268_SEQ42_Request_For_Arbitration_00.pdf | 42 | Request_For_Arbitration | Request from Argentina for Arbitration under Article 21.3(c) of the DSU | ARBITRATION | null | 0 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 15 March 2005 | WT/DS268/9; WT/DS268/R; WT/DS268/AB/R | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 1 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Request from Argentina for Arbitration under Article 21.3(c) of the DSU
The following communication, dated 11 March 2005, from the delegation of Argentina to the
Chairman of the Dispute Settlement Body, is circulated ... | 2026-03-15T15:46:47.968854 | |
268 | 268 | DS268_SEQ43_Arbitration_Award.pdf | DS268_SEQ43_Arbitration_Award.pdf | 43 | Arbitration_Award | Award of the Arbitrator | ARBITRATION | null | null | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 7 June 2005 | WT/DS268/12 | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 24 | UNITED STATES – SUNSET REVIEWS OF ANTI-DUMPING
MEASURES ON OIL COUNTRY TUBULAR GOODS
FROM ARGENTINA
ARB-2005-1/18
Arbitration
under Article 21.3(c) of the
Understanding on Rules and Procedures
Governing the Settlement of Disputes
Award of the Arbitrator
A.V. Ganesan
AWARD OF THE ARBITRATOR
Parties:
Argentina
Unit... | 2026-03-15T15:46:47.979135 | |
268 | 268 | DS268_SEQ44_Request_For_Arbitration_01.pdf | DS268_SEQ44_Request_For_Arbitration_01.pdf | 44 | Request_For_Arbitration | Request by the United States for Arbitration under Article 22.6 of the DSU | ARBITRATION | null | 1 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA | 4 June 2007 | WT/DS268/25 | ['Argentina'] | ['U.S.'] | ['China', 'EU', 'Japan', 'South Korea', 'Mexico', 'Taiwan'] | Implementation & Compliance | Art. 1, 2, 3, 6, 11, 12, 18, Annex II Anti-dumpingArt. VI, X GATT 1994Art. XVI:4 Agreement Establishing the World Trade Organization | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Argentina.
On 7 October 2002, Argentina requested consultations
with the US regarding the final determinations of the US Department of
Commerce (“D... | 1 | UNITED STATES - SUNSET REVIEWS OF ANTI-DUMPING MEASURES
ON OIL COUNTRY TUBULAR GOODS FROM ARGENTINA
Request by the United States for Arbitration under Article 22.6 of the DSU
The following communication, dated 1 June 2007, from the delegation of the United States to
the Chairman of the Dispute Settlement Body, is ci... | 2026-03-15T15:46:47.979758 | |
269 | 269 | DS269_SEQ01_Request_For_Consultations.pdf | DS269_SEQ01_Request_For_Consultations.pdf | 1 | Request_For_Consultations | Request for Consultations by Brazil | NUMBERED | null | null | EUROPEAN COMMUNITIES - CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 16 October 2002 | WT/DS269/1 | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 2 | EUROPEAN COMMUNITIES - CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Request for Consultations by Brazil
The following communication, dated 11October 2002, from the Permanent Mission of Brazil
to the Permanent Delegation of the European Commission and to the Chairman of the Dispute
Settlement Body, is circulat... | 2026-03-15T15:46:50.186413 | |
269 | 269 | DS269_SEQ02_Request_To_Join_Consultations.pdf | DS269_SEQ02_Request_To_Join_Consultations.pdf | 2 | Request_To_Join_Consultations | Request to Join Consultations Communication from the United States | NUMBERED | null | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 29 October 2002 | WT/DS269/2; WT/DS269/1 | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Request to Join Consultations
Communication from the United States
The following communication, dated 25 October 2002, from the Permanent Mission of the
United States to the Permanent Delegation of the European Commission, the Permanent Missi... | 2026-03-15T15:46:50.187086 | |
269 | 269 | DS269_SEQ03_Request_For_Establishment_Of_Panel.pdf | DS269_SEQ03_Request_For_Establishment_Of_Panel.pdf | 3 | Request_For_Establishment_Of_Panel | Request for the Establishment of a Panel by Brazil | NUMBERED | null | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 22 September 2003 | WT/DS269/3; WT/DS269/1 | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 2 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Request for the Establishment of a Panel by Brazil
The following communication, dated 19 September 2003, from the Permanent Mission of
Brazil to the Chairman of the Dispute Settlement Body, is circulated pursuant to Article 6.2 of the
DSU.
On... | 2026-03-15T15:46:50.188039 | |
269 | 269 | DS269_SEQ04_Working_Procedures.pdf | DS269_SEQ04_Working_Procedures.pdf | 4 | Working_Procedures | Notification of an Other Appeal by Brazil under Article 16.4 and Article 17 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), and under Rule 23(1) of the Working Procedures for Appellate Review | NUMBERED | null | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 27 June 2005 | WT/DS269/7 | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 2 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Notification of an Other Appeal by Brazil
under Article 16.4 and Article 17 of the Understanding on Rules
and Procedures Governing the Settlement of Disputes (DSU),
and under Rule 23(1) of the Working Procedures for Appellate Review
The f... | 2026-03-15T15:46:50.189358 | |
269 | 269 | DS269_SEQ05_Understanding.pdf | DS269_SEQ05_Understanding.pdf | 5 | Understanding | Understanding between Brazil and the European Communities Regarding Procedures under Articles 21 and 22 of the DSU | NUMBERED | null | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 31 July 2006 | WT/DS269/16 | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 3 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION
OF FROZEN BONELESS CHICKEN CUTS
Understanding between Brazil and the European Communities
Regarding Procedures under Articles 21 and 22 of the DSU
The following communication, dated 26 July 2006, from the delegation of Brazil and the
delegation of the European Communiti... | 2026-03-15T15:46:50.190902 | |
269 | 269 | DS269_SEQ06_Executive_Summary_01.pdf | DS269_SEQ06_Executive_Summary_01.pdf | 6 | Executive_Summary | WT/DS269/R Page A-1 ANNEX A EXECUTIVE SUMMARY BY THAILAND AFTER THE FIRST SUBSTANTIVE MEETING (21 October 2004) I. INTRODUCTION ................................................................................................................... .2 | NUMBERED | null | 1 | 21 October 2004 | WT/DS269/R | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 19 | I. INTRODUCTION
1. The basic legal issue in this case is that, as a result of the EC's classification of frozen salted
chicken cuts with a salt content of 1.2% by weight or more in a manner inconsistent with the correct
interpretation of headings 0210 and 0207 in the EC 's Schedule of Concessions, the EC provides to
Th... | 2026-03-15T15:46:50.204079 | ||
269 | 269 | DS269_SEQ07_Executive_Summary_02.pdf | DS269_SEQ07_Executive_Summary_02.pdf | 7 | Executive_Summary | WT/DS269/R Page B-1 ANNEX B SUBMISSIONS BY THIRD PARTIES Contents Page Annex B-1 Third Party Executive Summary by China B-2 Annex B-2 Third Party Oral Statement of the United States at the First Meeting of | NUMBERED | null | 2 | null | WT/DS269/R | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 7 | ANNEX B
SUBMISSIONS BY THIRD PARTIES
Contents Page
Annex B-1 Third Party Executive Summary by China
B-2
Annex B-2 Third Party Oral Statement of the United States at the First Meeting of
the Panel
B-5
ANNEX B-1
THIRD PARTY SUBMISSION OF CHINA
EXECUTIVE SUMMARY
(30 September 2004)
I. INTRODUCTION
1. China's third... | 2026-03-15T15:46:50.207107 | ||
269 | 269 | DS269_SEQ08_Request_For_Establishment_Of_Panel_05.pdf | DS269_SEQ08_Request_For_Establishment_Of_Panel_05.pdf | 8 | Request_For_Establishment_Of_Panel | WT/DS269/R Page E-1 ANNEX E REQUESTS FOR THE ESTABLISHMENT OF A PANEL Contents Page Annex E-1 Request for the Establishmen t of a Panel by Brazil (WT/DS269/3) E-2 Annex E-2 Request for the Establishment of a Panel by Thailand (WT/DS286/5) | NUMBERED | null | 5 | null | WT/DS269/R; WT/DS269/3; WT/DS286/5 | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 5 | ANNEX E
REQUESTS FOR THE ESTABLISHMENT OF A PANEL
Contents Page
Annex E-1 Request for the Establishmen t of a Panel by Brazil ()
E-2
Annex E-2 Request for the Establishment of a Panel by Thailand ()
E-4
ANNEX E-1
REQUEST FOR THE ESTABLISHMENT OF PANEL BY BRAZIL
EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FR... | 2026-03-15T15:46:50.208926 | ||
269 | 269 | DS269_SEQ09_Report_Of_Panel_00.pdf | DS269_SEQ09_Report_Of_Panel_00.pdf | 9 | Report_Of_Panel | Complaint by Brazil Report of the Panel | PANEL_REPORT | null | 0 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 30 May 2005 | WT/DS269/R | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 145 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION
OF FROZEN BONELESS CHICKEN CUTS
Complaint by Brazil
Report of the Panel
I. INTRODUCTION
1.1 On 11 October 2002, Brazil requested consultations with the European Communities pursuant
to Article 4 of the Understanding on the Rules a nd Procedures Governing the Settlement o... | 2026-03-15T15:46:50.308145 | |
269 | 269 | DS269_SEQ10_Report_Of_Panel_03.pdf | DS269_SEQ10_Report_Of_Panel_03.pdf | 10 | Report_Of_Panel | WT/DS269/R Page C-1 ANNEX C RESPONSES TO QUESTIONS BY THE PANEL AND OTHER PARTIES Contents Page Annex C-1 Responses by Brazil to Questions posed by the Panel after the First Substantive Meeting (14 October 2004) C-2 Annex C-2 Responses by Brazil to Questions posed by the Panel and the European | PANEL_REPORT | null | 3 | 14 October 2004 | WT/DS269/R | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 149 | ANNEX C
RESPONSES TO QUESTIONS BY THE PANEL AND OTHER PARTIES
Contents Page
Annex C-1 Responses by Brazil to Questions posed by the Panel after the First
Substantive Meeting (14 October 2004)
C-2
Annex C-2 Responses by Brazil to Questions posed by the Panel and the European
Communities after the Second Substantive Me... | 2026-03-15T15:46:50.403177 | ||
269 | 269 | DS269_SEQ11_Report_Of_Panel_04.pdf | DS269_SEQ11_Report_Of_Panel_04.pdf | 11 | Report_Of_Panel | WT/DS269/R Page D-1 ANNEX D CHAPTER 2 OF THE HARMONIZED SYSTEM (1992 VERSION) | PANEL_REPORT | null | 4 | null | WT/DS269/R | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 2 | ANNEX D
CHAPTER 2 OF THE HARMONIZED SYSTEM (1992 VERSION)
2 MEAT AND EDIBLE MEAT OFFAL
0201 Meat of bovine animals, fresh or chilled
0201.10 -Carcasses and half-carcasses
0201.20 -Other cuts with bone in
0201.30 -Boneless
0202 Meat of bovine animals, frozen.
0202.10 -Carcasses and half-carcasses
0202.20 -Other cuts w... | 2026-03-15T15:46:50.404033 | ||
269 | 269 | DS269_SEQ12_Report_Of_Panel_06.pdf | DS269_SEQ12_Report_Of_Panel_06.pdf | 12 | Report_Of_Panel | WT/DS269/R Page F-1 ANNEX F LISTS OF EXHIBITS SUBMITTED BY THE PARTIES AND THIRD PARTIES Contents Page Annex F-1 List of Exhibits submitted by Brazil F-2 Annex F-2 List of Exhibits submitted by Thailand | PANEL_REPORT | null | 6 | null | WT/DS269/R | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 10 | ANNEX F
LISTS OF EXHIBITS SUBMITTED BY THE PARTIES AND THIRD PARTIES
Contents Page
Annex F-1 List of Exhibits submitted by Brazil
F-2
Annex F-2 List of Exhibits submitted by Thailand
F-6
Annex F-3 List of Exhibits submitted by the European Communities
F-8
Annex F-4 Exhibit submitted by the United States
F-10
ANN... | 2026-03-15T15:46:50.407762 | ||
269 | 269 | DS269_SEQ13_Request_For_Arbitration.pdf | DS269_SEQ13_Request_For_Arbitration.pdf | 13 | Request_For_Arbitration | Request from Brazil for Arbitration under Article 21.3(c) of the DSU | ARBITRATION | null | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 24 November 2005 | WT/DS269/11; WT/DS269/AB/R; WT/DS269/R | ['Brazil'] | ['EU'] | ['China', 'Thailand', 'U.S.'] | Appellate Body | Art. II:1, XXIII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Brazil.
On 11 October 2002, Brazil requested consultations with the
European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulation... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Request from Brazil for Arbitration under Article 21.3(c) of the DSU
The following communication, dated 22 Novemb er 2005, from the delegation of Brazil to the
Chairman of the Dispute Settlement Body, is circulated at the request of that d... | 2026-03-15T15:46:50.408300 | |
269 | 286 | DS286_SEQ01_Note_By_Secretariat_00.pdf | DS286_SEQ01_Note_By_Secretariat_00.pdf | 1 | Note_By_Secretariat | Constitution of the Panel Established at the Requests of Brazil and Thailand Note by the Secretariat | NUMBERED | null | 0 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 29 June 2004 | WT/DS269/4; WT/DS286/6; WT/DS286/5 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 2 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Constitution of the Panel Established at the Requests
of Brazil and Thailand
Note by the Secretariat
1. At its meeting on 7 November 2003, the Di spute Settlement Body (DSB) established a panel
pursuant to the request of Brazil in documen... | 2026-03-15T15:46:51.467523 | |
269 | 286 | DS286_SEQ02_Note_By_Secretariat_Rev.pdf | DS286_SEQ02_Note_By_Secretariat_Rev.pdf | 2 | Note_By_Secretariat | Constitution of the Panel Established at the Requests of Brazil and Thailand Note by the Secretariat Revision | NUMBERED | Rev | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 13 September 2004 | WT/DS269/4/Rev.1; WT/DS286/6/Rev.1; WT/DS286/5 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 2 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Constitution of the Panel Established at the Requests
of Brazil and Thailand
Note by the Secretariat
Revision
1. At its meeting on 7 November 2003, the Di spute Settlement Body (DSB) established a panel
pursuant to the request of Brazil ... | 2026-03-15T15:46:51.468482 | |
269 | 286 | DS286_SEQ03_Note_By_Secretariat_Rev2.pdf | DS286_SEQ03_Note_By_Secretariat_Rev2.pdf | 3 | Note_By_Secretariat | Constitution of the Panel Established at the Requests of Brazil and Thailand Note by the Secretariat Revision | NUMBERED | Rev | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 20 September 2004 | WT/DS269/4/Rev.2; WT/DS286/6/Rev.2; WT/DS286/5 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 2 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Constitution of the Panel Established at the Requests
of Brazil and Thailand
Note by the Secretariat
Revision
1. At its meeting on 7 November 2003, the Di spute Settlement Body (DSB) established a panel
pursuant to the request of Brazil ... | 2026-03-15T15:46:51.469424 | |
269 | 286 | DS286_SEQ04_Communication_00.pdf | DS286_SEQ04_Communication_00.pdf | 4 | Communication | Communication from the Chairman of the Panel | NUMBERED | null | 0 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 23 November 2004 | WT/DS269/5; WT/DS286/7 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Communication from the Chairman of the Panel
The following communication, dated 19 Nove mber 2004, addressed to the Dispute Settlement
Body (DSB), is circulated in accordance with Article 12.9 of the Dispute Settlement Understanding
(DSU).... | 2026-03-15T15:46:51.469898 | |
269 | 286 | DS286_SEQ05_Notification_Of_Appeal.pdf | DS286_SEQ05_Notification_Of_Appeal.pdf | 5 | Notification_Of_Appeal | Notification of an Appeal by the European Communities under Article 16.4 and Article 17 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), and under Rule 20(1) of the Working Procedures for Appellate Review | NUMBERED | null | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 13 June 2005 | WT/DS269/6; WT/DS286/8 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 3 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Notification of an Appeal by the European Communities
under Article 16.4 and Article 17 of the Understanding on Rules
and Procedures Governing the Settlement of Disputes (DSU),
and under Rule 20(1) of the Working Procedures for Appellate Rev... | 2026-03-15T15:46:51.471315 | |
269 | 286 | DS286_SEQ06_Communication_01.pdf | DS286_SEQ06_Communication_01.pdf | 6 | Communication | Communication from the Appellate Body | NUMBERED | null | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 12 August 2005 | WT/DS269/8; WT/DS286/10 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION
OF FROZEN BONELESS CHICKEN CUTS
Communication from the Appellate Body
The following communication, dated 11 Augus t 2005, from the Chairman of the Appellate
Body addressed to the Chairman of the Dispute Settlement Body, is circulated in accordance with
Article 17.5 of th... | 2026-03-15T15:46:51.471802 | |
269 | 286 | DS286_SEQ07_Communication_02.pdf | DS286_SEQ07_Communication_02.pdf | 7 | Communication | Communication from the Appellate Body | NUMBERED | null | 2 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 13 September 2005 | WT/DS269/9; WT/DS286/11; WT/DS269/AB/R; WT/DS286/AB/R. | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION
OF FROZEN BONELESS CHICKEN CUTS
Communication from the Appellate Body
The following communication, dated 12 Septem ber 2005, from the Chairman of the Appellate
Body addressed to the Chairman of the Dispute Settlement Body, is circulated in accordance with
Article 17.5 of... | 2026-03-15T15:46:51.472132 | |
269 | 286 | DS286_SEQ08_Note_By_Secretariat_01.pdf | DS286_SEQ08_Note_By_Secretariat_01.pdf | 8 | Note_By_Secretariat | Appointment of Arbitrator under Article 21.3(c) of the Understanding on Rules and Procedures Governing the Settlement of Disputes Note by the Secretariat By joint letter dated 9 December 2005 from Braz il and the European Communities, and joint letter dated 13 December 2005 from the European Communities and Thaila nd, ... | NUMBERED | null | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 16 December 2005 | WT/DS269/12; WT/DS286/14 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Appointment of Arbitrator under Article 21.3(c) of the
Understanding on Rules and Procedures Governing the Settlement of Disputes
Note by the Secretariat
By joint letter dated 9 December 2005 from Braz il and the European Communities, an... | 2026-03-15T15:46:51.472431 | |
269 | 286 | DS286_SEQ09_Understanding_00.pdf | DS286_SEQ09_Understanding_00.pdf | 9 | Understanding | ARB-2005-4/21 Arbitration under Article 21.3(c) of the Understanding on Rules and Procedures Governing the Settlement of Disputes | NUMBERED | null | 0 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 20 February 2006 | WT/DS269/13; WT/DS286/15 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 39 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION
OF FROZEN BONELESS CHICKEN CUTS
ARB-2005-4/21
Arbitration
under Article 21.3(c) of the
Understanding on Rules and Procedures
Governing the Settlement of Disputes
Award of the Arbitrator
James Bacchus
AWARD OF THE ARBITRATOR
Parties:
Brazil
European Communities
Thailan... | 2026-03-15T15:46:51.490469 | |
269 | 286 | DS286_SEQ10_Understanding_01.pdf | DS286_SEQ10_Understanding_01.pdf | 10 | Understanding | Arbitration under Article 21.3(c) of the Understanding on Rules and Procedures Governing the Settlement of Disputes | NUMBERED | null | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 22 February 2006 | WT/DS269/14; WT/DS286/16; WT/DS269/13; WT/DS286/15 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Arbitration under Article 21.3(c) of the
Understanding on Rules and Procedures Governing the Settlement of Disputes
The following communication, dated 20 February 2006, from the arbitrator, Mr. James Bacchus,
to the Chairman of the Disput... | 2026-03-15T15:46:51.490859 | |
269 | 286 | DS286_SEQ11_Status_Report.pdf | DS286_SEQ11_Status_Report.pdf | 11 | Status_Report | Status Report by the European Communities | NUMBERED | null | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 9 June 2006 | WT/DS269/15; WT/DS286/17 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 2 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Status Report by the European Communities
The following communication, dated 8 June 2006, from the delegation of the European
Communities to the Chairman of the Dispute Settleme nt Body, is circulated pursuant to Article 21.6
of the DSU.
... | 2026-03-15T15:46:51.491646 | |
269 | 286 | DS286_SEQ12_Status_Report_Add.pdf | DS286_SEQ12_Status_Report_Add.pdf | 12 | Status_Report | Status Report by the European Communities Addendum | NUMBERED | Add | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 4 July 2006 | WT/DS269/15/Add.1; WT/DS286/17/Add.1 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF
FROZEN BONELESS CHICKEN CUTS
Status Report by the European Communities
Addendum
The following communication, dated 30 June 2006, from the delegation of the European
Communities to the Chairman of the Dispute Settleme nt Body, is circulated pursuant to Article 21.6
of... | 2026-03-15T15:46:51.492225 | |
269 | 286 | DS286_SEQ13_Appellate_Body_Report_And_Panel_Report.pdf | DS286_SEQ13_Appellate_Body_Report_And_Panel_Report.pdf | 13 | Appellate_Body_Report_And_Panel_Report | Appellate Body Report and Panel Reports Action by the Dispute Settlement Body | AB_REPORT | null | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 30 September 2005 | WT/DS269/10; WT/DS286/12; WT/DS269/AB/R; WT/DS286/AB/R; WT/DS269/R; WT/DS286/R | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION
OF FROZEN BONELESS CHICKEN CUTS
Appellate Body Report and Panel Reports
Action by the Dispute Settlement Body
At its meeting on 27 September 2005, the Di spute Settlement Body adopted the Appellate
Body report on European Communities – Customs Classific ation of Frozen ... | 2026-03-15T15:46:51.492753 | |
269 | 286 | DS286_SEQ14_Report_Of_Appellate_Body.pdf | DS286_SEQ14_Report_Of_Appellate_Body.pdf | 14 | Report_Of_Appellate_Body | Report of the Appellate Body | AB_REPORT | null | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 12 September 2005 | WT/DS269/AB/R; WT/DS286/AB/R | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 157 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION
OF FROZEN BONELESS CHICKEN CUTS
AB-2005-5
Report of the Appellate Body
APPELLATE BODY
European Communities, Appellant/Appellee
Brazil, Appellant/Appellee
Thailand, Appellant/Appellee
China, Third Participant
United States, Third Participant
AB-2005-5
Present:
Sace... | 2026-03-15T15:46:51.566507 | |
269 | 286 | DS286_SEQ15_Report_Of_Appellate_Body_Corr.pdf | DS286_SEQ15_Report_Of_Appellate_Body_Corr.pdf | 15 | Report_Of_Appellate_Body | Report of the Appellate Body Corrigendum On page 58, paragraph 146, in the second line, "heading 02.07" should read "heading 02.10", and in the third line, "heading 02.10" should read "heading 02.07". COMMUNAUTÉS EUROPÉENNES – CLASSIFICATION DOUANIÈRE DES MORCEAUX DE POULET DÉSOSSÉS ET CONGELÉS | AB_REPORT | Corr | null | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION OF FROZEN BONELESS CHICKEN CUTS | 3 February 2006 | WT/DS269/AB/R/Corr.1; WT/DS286/AB/R/Corr.1 | ['Thailand'] | ['EU'] | ['Brazil', 'China', 'U.S.'] | Appellate Body | Art. II, XXII GATT 1994 | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by Thailand.
On 11 October 2002, Brazil requested consultations with
the European Communities concerning EC Commission Regulation No. 1223/2002
(“Regulat... | 1 | EUROPEAN COMMUNITIES – CUSTOMS CLASSIFICATION
OF FROZEN BONELESS CHICKEN CUTS
Report of the Appellate Body
Corrigendum
On page 58, paragraph 146, in the second line, "heading 02.07" should read "heading 02.10",
and in the third line, "heading 02.10" should read "heading 02.07".
COMMUNAUTÉS EUROPÉENNES – CLASSIFICA... | 2026-03-15T15:46:51.566948 | |
270 | 270 | DS270_SEQ01_Request_For_Consultations.pdf | DS270_SEQ01_Request_For_Consultations.pdf | 1 | Request_For_Consultations | Request for Consultations by the Philippines | NUMBERED | null | null | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH FRUIT AND VEGETABLES | 23 October 2002 | WT/DS270/1; G/L/575; G/SPS/GEN/345; G/LIC/D/34 | General Council; Import Licensing (LIC); Sanitary and Phytosanitary Measures (SPS) | ['Philippines'] | ['Australia'] | ['Chile', 'China', 'EU', 'Ecuador', 'India', 'Thailand', 'U.S.'] | Panel | Art. 2.3 Sanitary and Phytosanitary Measures (SPS)Art. XI:1 GATT 1994Art. 3.2, 3.5 Import LicensingArt. 2.2, 5.1, 5.2, 5.3, 5.6, 6.1, 6.2, 3.1, 5.5 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October 2002, the
Philippines requested consultations with Australia on certain measures
affecting the importation into Australia of fresh fruit and vegetables,
including bananas, which inc... | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH FRUIT AND VEGETABLES
Request for Consultations by the Philippines
The following communication, dated 18 October 2002, from the Permanent Mission of the
Philippines to the Permanent Mission of Australi a and to the Chairman of the Dispute Settlement
Body, i... | 2026-03-15T15:46:51.648386 |
270 | 270 | DS270_SEQ02_Request_To_Join_Consultations_00.pdf | DS270_SEQ02_Request_To_Join_Consultations_00.pdf | 2 | Request_To_Join_Consultations | Request to Join Consultations Communication from the European Communities | NUMBERED | null | 0 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH FRUIT AND VEGETABLES | 6 November 2002 | WT/DS270/2 | ['Philippines'] | ['Australia'] | ['Chile', 'China', 'EU', 'Ecuador', 'India', 'Thailand', 'U.S.'] | Panel | Art. 2.3 Sanitary and Phytosanitary Measures (SPS)Art. XI:1 GATT 1994Art. 3.2, 3.5 Import LicensingArt. 2.2, 5.1, 5.2, 5.3, 5.6, 6.1, 6.2, 3.1, 5.5 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October 2002, the
Philippines requested consultations with Australia on certain measures
affecting the importation into Australia of fresh fruit and vegetables,
including bananas, which inc... | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH FRUIT AND VEGETABLES
Request to Join Consultations
Communication from the European Communities
The following communication, dated 1 November 2002, from the Permanent Delegation of
the European Commission to the Permanent Missi on of Australia, the Permanen... | 2026-03-15T15:46:51.649064 | |
270 | 270 | DS270_SEQ03_Request_To_Join_Consultations_01.pdf | DS270_SEQ03_Request_To_Join_Consultations_01.pdf | 3 | Request_To_Join_Consultations | Request to Join Consultations Communication from Thailand | NUMBERED | null | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH FRUIT AND VEGETABLES | 5 November 2002 | WT/DS270/3 | ['Philippines'] | ['Australia'] | ['Chile', 'China', 'EU', 'Ecuador', 'India', 'Thailand', 'U.S.'] | Panel | Art. 2.3 Sanitary and Phytosanitary Measures (SPS)Art. XI:1 GATT 1994Art. 3.2, 3.5 Import LicensingArt. 2.2, 5.1, 5.2, 5.3, 5.6, 6.1, 6.2, 3.1, 5.5 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October 2002, the
Philippines requested consultations with Australia on certain measures
affecting the importation into Australia of fresh fruit and vegetables,
including bananas, which inc... | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH FRUIT AND VEGETABLES
Request to Join Consultations
Communication from Thailand
The following communication, dated 1 November 2002, from the Permanent Mission of
Thailand to the Chairman of the Dispute Settlement Body, the Permanent Mission of the Philippin... | 2026-03-15T15:46:51.649620 | |
270 | 270 | DS270_SEQ04_Request_To_Join_Consultations_02.pdf | DS270_SEQ04_Request_To_Join_Consultations_02.pdf | 4 | Request_To_Join_Consultations | Acceptance by Australia of the Requests to Join Consultations The European Communities and Thailand notified the Dispute Settlement Body of their desire to be joined in the consultations requested by the Philippines, pursuant to Article 4.11 of the DSU. The Permanent Mission of Australia informed the Dispute Settlement... | NUMBERED | null | 2 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH FRUIT AND VEGETABLES | 12 November 2002 | WT/DS270/4 | ['Philippines'] | ['Australia'] | ['Chile', 'China', 'EU', 'Ecuador', 'India', 'Thailand', 'U.S.'] | Panel | Art. 2.3 Sanitary and Phytosanitary Measures (SPS)Art. XI:1 GATT 1994Art. 3.2, 3.5 Import LicensingArt. 2.2, 5.1, 5.2, 5.3, 5.6, 6.1, 6.2, 3.1, 5.5 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October 2002, the
Philippines requested consultations with Australia on certain measures
affecting the importation into Australia of fresh fruit and vegetables,
including bananas, which inc... | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH FRUIT AND VEGETABLES
Acceptance by Australia of the Requests to Join Consultations
The European Communities and Thailand notified the Dispute Settlement Body of their desire
to be joined in the consultations requested by the Philippines, pursuant to Articl... | 2026-03-15T15:46:51.651207 | |
270 | 270 | DS270_SEQ05_Request_For_Establishment_Of_Panel.pdf | DS270_SEQ05_Request_For_Establishment_Of_Panel.pdf | 5 | Request_For_Establishment_Of_Panel | Request for the Establishment of a Panel by the Philippines | NUMBERED | null | null | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH FRUIT AND VEGETABLES | 10 July 2003 | WT/DS270/5 | ['Philippines'] | ['Australia'] | ['Chile', 'China', 'EU', 'Ecuador', 'India', 'Thailand', 'U.S.'] | Panel | Art. 2.3 Sanitary and Phytosanitary Measures (SPS)Art. XI:1 GATT 1994Art. 3.2, 3.5 Import LicensingArt. 2.2, 5.1, 5.2, 5.3, 5.6, 6.1, 6.2, 3.1, 5.5 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October 2002, the
Philippines requested consultations with Australia on certain measures
affecting the importation into Australia of fresh fruit and vegetables,
including bananas, which inc... | 3 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH FRUIT AND VEGETABLES
Request for the Establishment of a Panel by the Philippines
The following communication, dated 7 July 2003, from the Permanent Mission of the
Philippines to the Chairman of the Dispute Settlement Body, is circulated pursuant to Article... | 2026-03-15T15:46:51.652857 | |
270 | 270 | DS270_SEQ06_Request_For_Establishment_Of_Panel_Rev.pdf | DS270_SEQ06_Request_For_Establishment_Of_Panel_Rev.pdf | 6 | Request_For_Establishment_Of_Panel | Request for the Establishment of a Panel by the Philippines Revision1 | NUMBERED | Rev | null | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH FRUIT AND VEGETABLES | 11 July 2003 | WT/DS270/5/Rev.1 | ['Philippines'] | ['Australia'] | ['Chile', 'China', 'EU', 'Ecuador', 'India', 'Thailand', 'U.S.'] | Panel | Art. 2.3 Sanitary and Phytosanitary Measures (SPS)Art. XI:1 GATT 1994Art. 3.2, 3.5 Import LicensingArt. 2.2, 5.1, 5.2, 5.3, 5.6, 6.1, 6.2, 3.1, 5.5 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October 2002, the
Philippines requested consultations with Australia on certain measures
affecting the importation into Australia of fresh fruit and vegetables,
including bananas, which inc... | 3 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH FRUIT AND VEGETABLES
Request for the Establishment of a Panel by the Philippines
Revision1
The following communication, dated 7 July 2003, from the Permanent Mission of the
Philippines to the Chairman of the Dispute Settlement Body, is circulated pursuant ... | 2026-03-15T15:46:51.654522 | |
271 | 271 | DS271_SEQ01_Request_To_Join_Consultations_00.pdf | DS271_SEQ01_Request_To_Join_Consultations_00.pdf | 1 | Request_To_Join_Consultations | Request to Join Consultations Communication from the European Communities | NUMBERED | null | 0 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH PINEAPPLE | 5 November 2002 | WT/DS271/2 | ['Philippines'] | ['Australia'] | [] | Consultation | Art. XI, XIII GATT 1994Art. 2, 3, 4, 5, 6, 10 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October, the Philippines requested consultations
with Australia on certain measures affecting the importation into
Australia of fresh pineapple, which include, but are not limited to:
The Philipp... | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH PINEAPPLE
Request to Join Consultations
Communication from the European Communities
The following communication, dated 1 November 2002, from the Permanent Delegation of
the European Commission to the Permanent Missi on of Australia, the Permanent Mission o... | 2026-03-15T15:46:51.684210 | |
271 | 271 | DS271_SEQ02_Request_To_Join_Consultations_01.pdf | DS271_SEQ02_Request_To_Join_Consultations_01.pdf | 2 | Request_To_Join_Consultations | Request to Join Consultations Communication from Thailand | NUMBERED | null | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH PINEAPPLE | 5 November 2002 | WT/DS271/3 | ['Philippines'] | ['Australia'] | [] | Consultation | Art. XI, XIII GATT 1994Art. 2, 3, 4, 5, 6, 10 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October, the Philippines requested consultations
with Australia on certain measures affecting the importation into
Australia of fresh pineapple, which include, but are not limited to:
The Philipp... | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH PINEAPPLE
Request to Join Consultations
Communication from Thailand
The following communication, dated 1 November 2002, from the Permanent Mission of
Thailand to the Chairman of the Dispute Settlement Body, the Permanent Mission of the Philippines
and the ... | 2026-03-15T15:46:51.684694 | |
271 | 271 | DS271_SEQ03_Request_To_Join_Consultations_02.pdf | DS271_SEQ03_Request_To_Join_Consultations_02.pdf | 3 | Request_To_Join_Consultations | Acceptance by Australia to Join Consultations The European Communities and Thailand notified the Dispute Settlement Body of their desire to be joined in the consultations requested by the Philippines, pursuant to Article 4.11 of the DSU. The Permanent Mission of Australia informed the Dispute Settlement Body that it ha... | NUMBERED | null | 2 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH PINEAPPLE | 12 November 2002 | WT/DS271/4 | ['Philippines'] | ['Australia'] | [] | Consultation | Art. XI, XIII GATT 1994Art. 2, 3, 4, 5, 6, 10 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October, the Philippines requested consultations
with Australia on certain measures affecting the importation into
Australia of fresh pineapple, which include, but are not limited to:
The Philipp... | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH PINEAPPLE
Acceptance by Australia to Join Consultations
The European Communities and Thailand notified the Dispute Settlement Body of their desire
to be joined in the consultations requested by the Philippines, pursuant to Article 4.11 of the DSU.
The Perm... | 2026-03-15T15:46:51.685232 | |
271 | 271 | DS271_SEQ04_Request_For_Consultations.pdf | DS271_SEQ04_Request_For_Consultations.pdf | 4 | Request_For_Consultations | Request for Consultations by the Philippines | NUMBERED | null | null | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION OF FRESH PINEAPPLE | 23 October 2002 | WT/DS271/1; G/L/576; G/SPS/GEN/346 | General Council; Sanitary and Phytosanitary Measures (SPS) | ['Philippines'] | ['Australia'] | [] | Consultation | Art. XI, XIII GATT 1994Art. 2, 3, 4, 5, 6, 10 Sanitary and Phytosanitary Measures (SPS) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the Philippines.
On 18 October, the Philippines requested consultations
with Australia on certain measures affecting the importation into
Australia of fresh pineapple, which include, but are not limited to:
The Philipp... | 1 | AUSTRALIA – CERTAIN MEASURES AFFECTING THE IMPORTATION
OF FRESH PINEAPPLE
Request for Consultations by the Philippines
The following communication, dated 18 October 2002, from the Permanent Mission of the
Philippines to the Permanent Mission of Australi a and to the Chairman of the Dispute Settlement
Body, is circulate... | 2026-03-15T15:46:51.685796 |
272 | 272 | DS272_SEQ01_Request_For_Consultations_01.pdf | DS272_SEQ01_Request_For_Consultations_01.pdf | 1 | Request_For_Consultations | Request for Consultations by Argentina | NUMBERED | null | 1 | PERU - PROVISIONAL ANTI-DUMPING DUTIES ON VEGETABLE OILS FROM ARGENTINA | 28 October 2002 | WT/DS272/1; G/L/578; G/ADP/D44/1 | Anti-Dumping Practices (ADP); General Council | ['Argentina'] | ['Peru'] | [] | Consultation | Art. 2, 3, 4, 5, 6, 7, 12 Anti-dumpingArt. VI GATT 1994 | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by Argentina.
On 21 October 2002, Argentina requested consultations
with Peru on its anti-dumping investigation on imports of sunflower and
soya vegetable oils and their mixtures originating in Argentina
(Resolution... | 4 | PERU - PROVISIONAL ANTI-DUMPING DUTIES
ON VEGETABLE OILS FROM ARGENTINA
Request for Consultations by Argentina
The following communication, dated 21 October 2002, from the Permanent Mission of
Argentina to the Permanent Mission of Peru and to the Chairman of the Dispute Settlement Body, is
circulated in accordance with... | 2026-03-15T15:46:51.720679 |
273 | 273 | DS273_SEQ01_Request_For_Consultations_01.pdf | DS273_SEQ01_Request_For_Consultations_01.pdf | 1 | Request_For_Consultations | Request for Consultations by the European Communities | NUMBERED | null | 1 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS | 24 October 2002 | WT/DS273/1; G/L/579; G/SCM/D50/1 | General Council; Subsidies and Countervailing Measures (SCM) | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 4 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS
Request for Consultations by the European Communities
The following communication, dated 21 October 2002, from the Permanent Delegation of the
European Commission to the Permanent Mission of Korea and to the Chairman of the Dispute
Settlement Body, is circulated in... | 2026-03-15T15:46:55.547454 |
273 | 273 | DS273_SEQ02_Request_For_Establishment_Of_Panel.pdf | DS273_SEQ02_Request_For_Establishment_Of_Panel.pdf | 2 | Request_For_Establishment_Of_Panel | Request for the Establishment of a Panel by the European Communities | NUMBERED | null | null | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS | 13 June 2003 | WT/DS273/2 | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 3 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS
Request for the Establishment of a Panel by the European Communities
The following communication, dated 11 June 2003, from the Permanent Delegation of the
European Commission to the Chairman of the Disp ute Settlement Body, is circulated pursuant to
Article 6.2 of ... | 2026-03-15T15:46:55.548632 | |
273 | 273 | DS273_SEQ03_Communication_00.pdf | DS273_SEQ03_Communication_00.pdf | 3 | Communication | Communication from the European Communities | NUMBERED | null | 0 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS | 11 July 2003 | WT/DS273/3; WT/DS273/2 | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 1 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS
Communication from the European Communities
The following communication, dated 10 July 2003, from the Permanent Delegation of the
European Commission to the Dispute Settlement Body, is circulated at the request of that delegation.
The European Communities asks that... | 2026-03-15T15:46:55.549259 | |
273 | 273 | DS273_SEQ04_Communication_01.pdf | DS273_SEQ04_Communication_01.pdf | 4 | Communication | Communication from Japan | NUMBERED | null | 1 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS | 29 July 2003 | WT/DS273/4; WT/DS273/3 | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 1 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS
Communication from Japan
The following communication, dated 25 July 2003, from the Permanent Mission of Japan to
the Chairman of the Dispute Settlement Body, is circulated at the request of that delegation.
With regard to the above-mentioned proceeding, I wish to r... | 2026-03-15T15:46:55.549614 | |
273 | 273 | DS273_SEQ05_Communication_02.pdf | DS273_SEQ05_Communication_02.pdf | 5 | Communication | Communication from China | NUMBERED | null | 2 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS | 26 August 2003 | WT/DS273/5; WT/DS273/3 | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 1 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS
Communication from China
The following communication, dated 22 August 2003, from the Permanent Mission of China
to the Chairman of the Dispute Settlement Body, is circulated at the request of that delegation.
With regard to the above-mentioned proceeding, I wish to... | 2026-03-15T15:46:55.549938 | |
273 | 273 | DS273_SEQ06_Note_By_Secretariat_00.pdf | DS273_SEQ06_Note_By_Secretariat_00.pdf | 6 | Note_By_Secretariat | Constitution of the Panel Established at the Request of the European Communities Note by the Secretariat | NUMBERED | null | 0 | KOREA - MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS | 27 August 2003 | WT/DS273/6; WT/DS273/2; WT/DS273/2 | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 1 | KOREA - MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS
Constitution of the Panel Established at the Request of the European Communities
Note by the Secretariat
1. At its meeting on 21 July 2003, the Dispute Settlement Body established a Panel pursuant to
the request by the European Communities in document , in accordan... | 2026-03-15T15:46:55.550574 | |
273 | 273 | DS273_SEQ07_Note_By_Secretariat_01.pdf | DS273_SEQ07_Note_By_Secretariat_01.pdf | 7 | Note_By_Secretariat | Replacement of the Chairman of the Panel Note by the Secretariat Following the passing away on 11 April 2004 of Dr . Said El-Naggar, Chairman of the Panel, and pursuant to a joint request of the parties on 6 May 2004, the Director-General on 11 May 2004 has appointed a new Chairman to the Panel. Accordingly, the compo... | NUMBERED | null | 1 | KOREA - MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS | 19 May 2004 | WT/DS273/7 | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 1 | KOREA - MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS
Replacement of the Chairman of the Panel
Note by the Secretariat
Following the passing away on 11 April 2004 of Dr . Said El-Naggar, Chairman of the Panel,
and pursuant to a joint request of the parties on 6 May 2004, the Director-General on 11 May 2004
has app... | 2026-03-15T15:46:55.550788 | |
273 | 273 | DS273_SEQ08_Submission_01.pdf | DS273_SEQ08_Submission_01.pdf | 8 | Submission | WT/DS273/R Page A-1 ANNEX A EXECUTIVE SUMMARIES OF THE FIRST WRITTEN SUBMISSIONS OF THE PARTIES Contents Page Annex A-1 First Written Submission of the European Communities A-2 | NUMBERED | null | 1 | null | WT/DS273/R | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 18 | ANNEX A
EXECUTIVE SUMMARIES OF THE FIRST WRITTEN
SUBMISSIONS OF THE PARTIES
Contents Page
Annex A-1 First Written Submission of the European Communities A-2
Annex A-2 First Written Submission of Korea A-11
I. INTRODUCTION
1. The European Communities seeks a ruli ng from this Panel recommending that Korea
withdraw t... | 2026-03-15T15:46:55.561708 | ||
273 | 273 | DS273_SEQ09_Submission_02.pdf | DS273_SEQ09_Submission_02.pdf | 9 | Submission | Contents Page Annex B-1 Oral Statement of the European Communities B-2 Annex B-2 Oral Statement of Korea B-11 | NUMBERED | null | 2 | OF THE PARTIES – FIRST MEETING | null | WT/DS273/R | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 20 | ANNEX B
EXECUTIVE SUMMARIES OF THE ORAL STATEMENTS
OF THE PARTIES – FIRST MEETING
Contents Page
Annex B-1 Oral Statement of the European Communities B-2
Annex B-2 Oral Statement of Korea B-11
ANNEX B-1
ORAL STATEMENT OF THE EUROPEAN COMMUNITIES
(18 March 2004)
I. INTRODUCTION
1. In its oral statement, the EC fir... | 2026-03-15T15:46:55.573898 | |
273 | 273 | DS273_SEQ10_Executive_Summary_03.pdf | DS273_SEQ10_Executive_Summary_03.pdf | 10 | Executive_Summary | WT/DS273/R Page C-1 ANNEX C WRITTEN SUBMISSIONS AND ORAL STATEMENTS OF THE THIRD PARTIES Contents Page Annex C-1 Executive Summary of the Written Submission of China C-2 Annex C-2 Oral Statement of China C-5 | NUMBERED | null | 3 | null | WT/DS273/R | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 45 | ANNEX C
WRITTEN SUBMISSIONS AND ORAL STATEMENTS
OF THE THIRD PARTIES
Contents Page
Annex C-1 Executive Summary of the Written Submission of China C-2
Annex C-2 Oral Statement of China C-5
Annex C-3 Executive Summary of the Written Submission of Japan C-8
Annex C-4 Oral Statement of Japan C-10
Annex C-5 Responses of J... | 2026-03-15T15:46:55.593622 | ||
273 | 273 | DS273_SEQ11_Submission_05.pdf | DS273_SEQ11_Submission_05.pdf | 11 | Submission | WT/DS273/R Page E-1 ANNEX E EXECUTIVE SUMMARIES OF THE SECOND WRITTEN SUBMISSIONS OF THE PARTIES Contents Page Annex E-1 Second Written Submission of the European Communities E-2 | NUMBERED | null | 5 | null | WT/DS273/R | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 17 | ANNEX E
EXECUTIVE SUMMARIES OF THE SECOND WRITTEN
SUBMISSIONS OF THE PARTIES
Contents Page
Annex E-1 Second Written Submission of the European Communities E-2
Annex E-2 Second Written Submission of Korea E-9
I. INTRODUCTION
1. The Second Written Submission by the European Communities rebuts legal and factual
assert... | 2026-03-15T15:46:55.602687 | ||
273 | 273 | DS273_SEQ12_Submission_06.pdf | DS273_SEQ12_Submission_06.pdf | 12 | Submission | Contents Page Annex F-1 Oral Statement of the European Communities F-2 Annex F-2 Oral Statement of Korea F-12 | NUMBERED | null | 6 | OF THE PARTIES - SECOND MEETING | null | WT/DS273/R | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 21 | ANNEX F
EXECUTIVE SUMMARIES OF THE ORAL STATEMENTS
OF THE PARTIES - SECOND MEETING
Contents Page
Annex F-1 Oral Statement of the European Communities F-2
Annex F-2 Oral Statement of Korea F-12
1. Korea makes increasingly reference to the “f inancial and economic turmoil” the “assistance
of the IMF in resolving the f... | 2026-03-15T15:46:55.616094 | |
273 | 273 | DS273_SEQ13_Request_For_Establishment_Of_Panel_08.pdf | DS273_SEQ13_Request_For_Establishment_Of_Panel_08.pdf | 13 | Request_For_Establishment_Of_Panel | WT/DS273/R Page H-1 ANNEX H REQUEST FOR THE ESTABLISHMENT OF A PANEL Contents Page Annex H Request for the Establishment of a Panel – Document WT/DS273/2 H-2 | NUMBERED | null | 8 | null | WT/DS273/R; WT/DS273/2 | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 4 | ANNEX H
REQUEST FOR THE ESTABLISHMENT
OF A PANEL
Contents Page
Annex H Request for the Establishment of a Panel – Document H-2
ANNEX H
REQUEST FOR THE ESTABLISHMENT
OF A PANEL
KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS
Request for the Establishment of a Panel by the European Communities
The followin... | 2026-03-15T15:46:55.617466 | ||
273 | 273 | DS273_SEQ14_Report_Of_Panel.pdf | DS273_SEQ14_Report_Of_Panel.pdf | 14 | Report_Of_Panel | Panel Report Action by the Dispute Settlement Body | PANEL_REPORT | null | null | KOREA - MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS | 12 April 2005 | WT/DS273/8; WT/DS273/R; WT/DS273/R | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 1 | KOREA - MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS
Panel Report
Action by the Dispute Settlement Body
At its meeting on 11 April 2005, the Disput e Settlement Body adopted the Panel report on
NAVIRES DE COMMERCE
Rapport du Groupe spécial
Groupe spécial Corée – Mesures affectant le commerce des navires de com... | 2026-03-15T15:46:55.617823 | |
273 | 273 | DS273_SEQ15_Report_Of_Panel_00.pdf | DS273_SEQ15_Report_Of_Panel_00.pdf | 15 | Report_Of_Panel | Report of the Panel | PANEL_REPORT | null | 0 | KOREA – MEASURES AFFECTING TRADE IN COMMERCIAL VESSELS (WT/DS273) | 7 March 2005 | WT/DS273/R | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 185 | KOREA – MEASURES AFFECTING TRADE
IN COMMERCIAL VESSELS
(WT/DS273)
Report of the Panel
I. INTRODUCTION
A. COMPLAINT OF THE EUROPEAN COMMUNITIES
1.1 On 21 October 2002, the European Communities requested consultations with Korea pursuant
to Article 4 of the Dispute Settlement Understanding ("the DSU"), Article XXIII:1 ... | 2026-03-15T15:46:55.747727 | |
273 | 273 | DS273_SEQ16_Report_Of_Panel_04.pdf | DS273_SEQ16_Report_Of_Panel_04.pdf | 16 | Report_Of_Panel | WT/DS273/R Page D-1 ANNEX D RESPONSES OF THE PARTIES TO QUESTIONS FOLLOWING THE FIRST MEETING OF THE PANEL Contents Page Annex D-1 Responses of the European Communities to Questions from the Panel | PANEL_REPORT | null | 4 | null | WT/DS273/R | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 112 | ANNEX D
RESPONSES OF THE PARTIES TO QUESTIONS FOLLOWING
THE FIRST MEETING OF THE PANEL
Contents Page
Annex D-1 Responses of the European Communities to Questions from the
Panel
D-2
Annex D-2 Responses of the European Communities to Questions from
Korea
D-44
Annex D-3 Responses of Korea to Questions from the Panel D-5... | 2026-03-15T15:46:55.816923 | ||
273 | 273 | DS273_SEQ17_Report_Of_Panel_07.pdf | DS273_SEQ17_Report_Of_Panel_07.pdf | 17 | Report_Of_Panel | WT/DS273/R Page G-1 ANNEX G RESPONSES OF THE PARTIES TO QUESTIONS FOLLOWING THE SECOND MEETING AND COMMENTS THEREON Contents Page Annex G-1 Responses of the European Communities to Questions from the Panel (2 July 2004) G-2 | PANEL_REPORT | null | 7 | 2 July 2004 | WT/DS273/R | ['EU'] | ['South Korea'] | ['China', 'Taiwan', 'Japan', 'Mexico', 'Norway', 'U.S.'] | Panel | Art. 3.1, 3.2, 1, 2, 5, 6.3, 6.5 Subsidies and Countervailing Measures (SCM) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the European Communities.
On 21 October 2002, the European Communities requested
consultations with Korea on certain measures establishing subsidies to its
... | 197 | ANNEX G
RESPONSES OF THE PARTIES TO QUESTIONS FOLLOWING THE
SECOND MEETING AND COMMENTS THEREON
Contents Page
Annex G-1 Responses of the European Communities to Questions from the
Panel (2 July 2004)
G-2
Annex G-2 Comments of the European Communities on New Factual
Information Provided by Korea (9 July 2004)
G-44
Ann... | 2026-03-15T15:46:55.939016 | ||
274 | 274 | DS274_SEQ01_Request_For_Consultations_01.pdf | DS274_SEQ01_Request_For_Consultations_01.pdf | 1 | Request_For_Consultations | Request for Consultations by Chinese Taipei | NUMBERED | null | 1 | UNITED STATES – DEFINITIVE SAFEGUARD MEASURES ON IMPORTS OF CERTAIN STEEL PRODUCTS | 11 November 2002 | WT/DS274/1; G/L/584; G/SG/D29/1 | General Council; Safeguards (SG) | ['Taiwan'] | ['U.S.'] | [] | Consultation | Art. I:1, XIX:1 GATT 1994Art. 2, 2.1, 2.2, 3.1, 4.1, 4.2, 5.1 Safeguards | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by Chinese Taipei.
On 1 November 2002, Chinese Taipei requested
consultations with the United States with regard to safeguard measures on
steel imposed by the United States on imports of certain steel products.
Thes... | 2 | UNITED STATES – DEFINITIVE SAFEGUARD MEASURES
ON IMPORTS OF CERTAIN STEEL PRODUCTS
Request for Consultations by Chinese Taipei
The following communication, dated 1 November 2002, from the Permanent Representative
of the Separate Customs Territory of Taiwan, Pe nghu, Kinmen and Matsu to the Permanent Mission
of the Unit... | 2026-03-15T15:46:55.966055 |
274 | 274 | DS274_SEQ02_Request_To_Join_Consultations_00.pdf | DS274_SEQ02_Request_To_Join_Consultations_00.pdf | 2 | Request_To_Join_Consultations | Request to Join Consultations Communication from Japan | NUMBERED | null | 0 | UNITED STATES – DEFINITIVE SAFEGUARD MEASURES ON IMPORTS OF CERTAIN STEEL PRODUCTS | 25 November 2002 | WT/DS274/2 | ['Taiwan'] | ['U.S.'] | [] | Consultation | Art. I:1, XIX:1 GATT 1994Art. 2, 2.1, 2.2, 3.1, 4.1, 4.2, 5.1 Safeguards | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by Chinese Taipei.
On 1 November 2002, Chinese Taipei requested
consultations with the United States with regard to safeguard measures on
steel imposed by the United States on imports of certain steel products.
Thes... | 1 | UNITED STATES – DEFINITIVE SAFEGUARD MEASURES
ON IMPORTS OF CERTAIN STEEL PRODUCTS
Request to Join Consultations
Communication from Japan
The following communication, dated 21 November 2002, from the Permanent Mission of
Japan to the Permanent Mission of the United States, the Permanent Representative of the Separate
C... | 2026-03-15T15:46:55.966457 | |
274 | 274 | DS274_SEQ03_Request_To_Join_Consultations_01.pdf | DS274_SEQ03_Request_To_Join_Consultations_01.pdf | 3 | Request_To_Join_Consultations | Acceptance by the United States of the Request to Join Consultations Japan notified the Dispute Settlement Body (D SB) of its desire to be joined in the consultations requested by Chinese Taipei, pursuant to Article 4.11 of the DSU. The Permanent Mission of the United States informed the DSB that it had accepted the re... | NUMBERED | null | 1 | UNITED STATES – DEFINITIVE SAFEGUARD MEASURES ON IMPORTS OF CERTAIN STEEL PRODUCTS | 16 December 2002 | WT/DS274/3 | ['Taiwan'] | ['U.S.'] | [] | Consultation | Art. I:1, XIX:1 GATT 1994Art. 2, 2.1, 2.2, 3.1, 4.1, 4.2, 5.1 Safeguards | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by Chinese Taipei.
On 1 November 2002, Chinese Taipei requested
consultations with the United States with regard to safeguard measures on
steel imposed by the United States on imports of certain steel products.
Thes... | 1 | UNITED STATES – DEFINITIVE SAFEGUARD MEASURES
ON IMPORTS OF CERTAIN STEEL PRODUCTS
Acceptance by the United States of the Request to Join Consultations
Japan notified the Dispute Settlement Body (D SB) of its desire to be joined in the
consultations requested by Chinese Taipei, pursuant to Article 4.11 of the DSU.
The ... | 2026-03-15T15:46:55.966941 | |
275 | 275 | DS275_SEQ01_Request_For_Consultations.pdf | DS275_SEQ01_Request_For_Consultations.pdf | 1 | Request_For_Consultations | Request for Consultations by the United States | NUMBERED | null | null | VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS | 12 November 2002 | WT/DS275/1; G/L/587; G/LIC/D/35; G/AG/GEN/55; G/TRIMS/D/19 | Agriculture (AG); General Council; Import Licensing (LIC); Trade-Related Investment Measures (TRIMS) | ['U.S.'] | ['Venezuela'] | [] | Consultation | Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the United States.
On 7 November 2002 the United States requested
consultations with Venezuela concerning Venezuelan import licensing
systems and practices that restrict agricultural imports from the United
State... | 3 | VENEZUELA – IMPORT LICENSING MEASURES ON
CERTAIN AGRICULTURAL PRODUCTS
Request for Consultations by the United States
The following communication, dated 7 November 2002, from the Permanent Mission of the
United States to the Permanent Mission of Venezuela and to the Chairman of the Dispute Settlement
Body, is circulate... | 2026-03-15T15:46:56.034960 |
275 | 275 | DS275_SEQ02_Request_To_Join_Consultations_00.pdf | DS275_SEQ02_Request_To_Join_Consultations_00.pdf | 2 | Request_To_Join_Consultations | Request to Join Consultations Communication from the European Communities | NUMBERED | null | 0 | VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS | 22 November 2002 | WT/DS275/2 | ['U.S.'] | ['Venezuela'] | [] | Consultation | Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the United States.
On 7 November 2002 the United States requested
consultations with Venezuela concerning Venezuelan import licensing
systems and practices that restrict agricultural imports from the United
State... | 1 | VENEZUELA – IMPORT LICENSING MEASURES ON
CERTAIN AGRICULTURAL PRODUCTS
Request to Join Consultations
Communication from the European Communities
The following communication, dated 20 November 2002, from the Permanent Delegation of
the European Commission to the Permanent Mission of Venezuela, the Permanent Mission of t... | 2026-03-15T15:46:56.035510 | |
275 | 275 | DS275_SEQ03_Request_To_Join_Consultations_01.pdf | DS275_SEQ03_Request_To_Join_Consultations_01.pdf | 3 | Request_To_Join_Consultations | Request to Join Consultations Communication from Canada | NUMBERED | null | 1 | VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS | 25 November 2002 | WT/DS275/3 | ['U.S.'] | ['Venezuela'] | [] | Consultation | Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the United States.
On 7 November 2002 the United States requested
consultations with Venezuela concerning Venezuelan import licensing
systems and practices that restrict agricultural imports from the United
State... | 1 | VENEZUELA – IMPORT LICENSING MEASURES ON
CERTAIN AGRICULTURAL PRODUCTS
Request to Join Consultations
Communication from Canada
The following communication, dated 20 November 2002, from the Permanent Mission of
Canada to the Permanent Mission of Venezuela, the Permanent Mission of the United States and to
the Chairman o... | 2026-03-15T15:46:56.036010 | |
275 | 275 | DS275_SEQ04_Request_To_Join_Consultations_02.pdf | DS275_SEQ04_Request_To_Join_Consultations_02.pdf | 4 | Request_To_Join_Consultations | Request to Join Consultations Communication from New Zealand | NUMBERED | null | 2 | VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS | 26 November 2002 | WT/DS275/4; WT/DS275/1; G/L/587; G/LIC/D/35; G/AG/GEN/55 | Agriculture (AG); General Council; Import Licensing (LIC) | ['U.S.'] | ['Venezuela'] | [] | Consultation | Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the United States.
On 7 November 2002 the United States requested
consultations with Venezuela concerning Venezuelan import licensing
systems and practices that restrict agricultural imports from the United
State... | 1 | VENEZUELA – IMPORT LICENSING MEASURES ON
CERTAIN AGRICULTURAL PRODUCTS
Request to Join Consultations
Communication from New Zealand
The following communication, dated 21 November 2002, from the Permanent Mission of
New Zealand to the Permanent Mission of Venezuela, the Permanent Mission of the United States and
to the ... | 2026-03-15T15:46:56.036429 |
275 | 275 | DS275_SEQ05_Request_To_Join_Consultations_03.pdf | DS275_SEQ05_Request_To_Join_Consultations_03.pdf | 5 | Request_To_Join_Consultations | Request to Join Consultations Communication from Argentina | NUMBERED | null | 3 | VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS | 27 November 2002 | WT/DS275/5; WT/DS275/1; G/L/587; G/LIC/D/35; G/AG/GEN/55; G/TRIMS/D/19 | Agriculture (AG); General Council; Import Licensing (LIC); Trade-Related Investment Measures (TRIMS) | ['U.S.'] | ['Venezuela'] | [] | Consultation | Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the United States.
On 7 November 2002 the United States requested
consultations with Venezuela concerning Venezuelan import licensing
systems and practices that restrict agricultural imports from the United
State... | 1 | VENEZUELA – IMPORT LICENSING MEASURES ON
CERTAIN AGRICULTURAL PRODUCTS
Request to Join Consultations
Communication from Argentina
The following communication, dated 22 November 2002, from the Permanent Mission of
Argentina to the Permanent Mission of Venezuela, the Permanent Mission of the United States and
the Chairma... | 2026-03-15T15:46:56.036937 |
275 | 275 | DS275_SEQ06_Request_To_Join_Consultations_04.pdf | DS275_SEQ06_Request_To_Join_Consultations_04.pdf | 6 | Request_To_Join_Consultations | Request to Join Consultations Communication from Colombia | NUMBERED | null | 4 | VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS | 27 November 2002 | WT/DS275/6; WT/DS275/1; G/L/587 | General Council | ['U.S.'] | ['Venezuela'] | [] | Consultation | Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the United States.
On 7 November 2002 the United States requested
consultations with Venezuela concerning Venezuelan import licensing
systems and practices that restrict agricultural imports from the United
State... | 1 | VENEZUELA – IMPORT LICENSING MEASURES ON
CERTAIN AGRICULTURAL PRODUCTS
Request to Join Consultations
Communication from Colombia
The following communication, dated 22 November 2002, from the Permanent Mission of
Colombia to the Permanent Mission of Venezuela, the Permanent Mission of the United States and
the Chairman ... | 2026-03-15T15:46:56.037299 |
275 | 275 | DS275_SEQ07_Request_To_Join_Consultations_05.pdf | DS275_SEQ07_Request_To_Join_Consultations_05.pdf | 7 | Request_To_Join_Consultations | Request to Join Consultations Communication from Chile | NUMBERED | null | 5 | VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS | 27 November 2002 | WT/DS275/7; G/L/587; G/GEN/55; G/TRIMS/D/19. | General Council; Trade-Related Investment Measures (TRIMS) | ['U.S.'] | ['Venezuela'] | [] | Consultation | Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the United States.
On 7 November 2002 the United States requested
consultations with Venezuela concerning Venezuelan import licensing
systems and practices that restrict agricultural imports from the United
State... | 1 | VENEZUELA – IMPORT LICENSING MEASURES ON
CERTAIN AGRICULTURAL PRODUCTS
Request to Join Consultations
Communication from Chile
The following communication, dated 21 November 2002, from the Permanent Mission of
Chile to the Permanent Mission of Venezuela, the Permanent Mission of the United States and the
Chairman of the... | 2026-03-15T15:46:56.037884 |
275 | 275 | DS275_SEQ08_Request_To_Join_Consultations_06.pdf | DS275_SEQ08_Request_To_Join_Consultations_06.pdf | 8 | Request_To_Join_Consultations | Acceptance by Venezuela of the Requests to Join Consultations Argentina, Canada, Chile, Colombia, the European Communities and New Zealand notified the Dispute Settlement Body of their desire to be joined in the consultations requested by the United States, pursuant to Article 4.11 of the DSU. The Permanent Mission of ... | NUMBERED | null | 6 | VENEZUELA – IMPORT LICENSING MEASURES ON CERTAIN AGRICULTURAL PRODUCTS | 28 November 2002 | WT/DS275/8 | ['U.S.'] | ['Venezuela'] | [] | Consultation | Art. 4.2 AgricultureArt. III, X, XI, XIII GATT 1994Art. 1.4, 3.2, 3.5, 5.1, 5.2, 5.3 Import LicensingArt. 2.1 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
Consultations
Complaint by the United States.
On 7 November 2002 the United States requested
consultations with Venezuela concerning Venezuelan import licensing
systems and practices that restrict agricultural imports from the United
State... | 1 | VENEZUELA – IMPORT LICENSING MEASURES ON
CERTAIN AGRICULTURAL PRODUCTS
Acceptance by Venezuela of the Requests to Join Consultations
Argentina, Canada, Chile, Colombia, the European Communities and New Zealand notified
the Dispute Settlement Body of their desire to be joined in the consultations requested by the United... | 2026-03-15T15:46:56.038429 | |
276 | 276 | DS276_SEQ01_Request_For_Consultations.pdf | DS276_SEQ01_Request_For_Consultations.pdf | 1 | Request_For_Consultations | Request for Consultations by the United States | NUMBERED | null | null | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN | 19 December 2002 | WT/DS276/1; G/L/597; G/TRIMS/D/20 | General Council; Trade-Related Investment Measures (TRIMS) | ['U.S.'] | ['Canada'] | ['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico'] | Appellate Body | Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the United States.
On 17 December 2002, the United States requested
consultations with Canada as regards matters concerning the export of
wheat by the ... | 2 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT
AND TREATMENT OF IMPORTED GRAIN
Request for Consultations by the United States
The following communication, dated 17 December 2002, from the Permanent Mission of the
United States to the Permanent Mission of Canada and to the Chairman of the Dispute Settlement
Body, is cir... | 2026-03-15T15:46:58.890902 |
276 | 276 | DS276_SEQ02_Request_To_Join_Consultations_00.pdf | DS276_SEQ02_Request_To_Join_Consultations_00.pdf | 2 | Request_To_Join_Consultations | Request to Join Consultations Communication from Japan | NUMBERED | null | 0 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN | 7 January 2003 | WT/DS276/2 | ['U.S.'] | ['Canada'] | ['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico'] | Appellate Body | Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the United States.
On 17 December 2002, the United States requested
consultations with Canada as regards matters concerning the export of
wheat by the ... | 1 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT
AND TREATMENT OF IMPORTED GRAIN
Request to Join Consultations
Communication from Japan
The following communication, dated 20 December 2002, from the Permanent Mission of
Japan to the Permanent Mission of Canada, the Permanent Mission of the United States and to the
Chairma... | 2026-03-15T15:46:58.891302 | |
276 | 276 | DS276_SEQ03_Request_To_Join_Consultations_01.pdf | DS276_SEQ03_Request_To_Join_Consultations_01.pdf | 3 | Request_To_Join_Consultations | Request to Join Consultations Communication from Mexico | NUMBERED | null | 1 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN | 6 January 2003 | WT/DS276/3; WT/DS276/1. | ['U.S.'] | ['Canada'] | ['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico'] | Appellate Body | Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the United States.
On 17 December 2002, the United States requested
consultations with Canada as regards matters concerning the export of
wheat by the ... | 1 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT
AND TREATMENT OF IMPORTED GRAIN
Request to Join Consultations
Communication from Mexico
The following communication, dated 20 December 2002, from the Permanent Mission of
Mexico to the Permanent Mission of Canada, the Pe rmanent Mission of the United States and to the
Chai... | 2026-03-15T15:46:58.891568 | |
276 | 276 | DS276_SEQ04_Request_To_Join_Consultations_02.pdf | DS276_SEQ04_Request_To_Join_Consultations_02.pdf | 4 | Request_To_Join_Consultations | Request to Join Consultations Communication from the European Communities | NUMBERED | null | 2 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN | 7 January 2003 | WT/DS276/4 | ['U.S.'] | ['Canada'] | ['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico'] | Appellate Body | Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the United States.
On 17 December 2002, the United States requested
consultations with Canada as regards matters concerning the export of
wheat by the ... | 1 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT
AND TREATMENT OF IMPORTED GRAIN
Request to Join Consultations
Communication from the European Communities
The following communication, dated 20 December 2002, from the Permanent Delegation of
the European Commission to the Permanent Mission of Canada, the Permanent Mission... | 2026-03-15T15:46:58.892096 | |
276 | 276 | DS276_SEQ05_Request_To_Join_Consultations_03.pdf | DS276_SEQ05_Request_To_Join_Consultations_03.pdf | 5 | Request_To_Join_Consultations | Request to Join Consultations Communication from Australia | NUMBERED | null | 3 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN | 8 January 2003 | WT/DS276/5 | ['U.S.'] | ['Canada'] | ['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico'] | Appellate Body | Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the United States.
On 17 December 2002, the United States requested
consultations with Canada as regards matters concerning the export of
wheat by the ... | 1 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT
AND TREATMENT OF IMPORTED GRAIN
Request to Join Consultations
Communication from Australia
The following communication, dated 24 December 2002, from the Permanent Mission of
Australia to the Permanent Mission of Canada, the Permanent Mission of the United States and to the... | 2026-03-15T15:46:58.892524 | |
276 | 276 | DS276_SEQ06_Request_For_Establishment_Of_Panel_00.pdf | DS276_SEQ06_Request_For_Establishment_Of_Panel_00.pdf | 6 | Request_For_Establishment_Of_Panel | Request for the Establishment of a Panel by the United States | NUMBERED | null | 0 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN | 7 March 2003 | WT/DS276/6 | ['U.S.'] | ['Canada'] | ['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico'] | Appellate Body | Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the United States.
On 17 December 2002, the United States requested
consultations with Canada as regards matters concerning the export of
wheat by the ... | 2 | CANADA – MEASURES RELATING TO EXPORTS OF WHEAT
AND TREATMENT OF IMPORTED GRAIN
Request for the Establishment of a Panel by the United States
The following communication, dated 6 March 2003, from the Permanent Mission of the
United States to the Chairman of the Dispute Settlement Body, is circulated pursuant to Article ... | 2026-03-15T15:46:58.893482 | |
276 | 276 | DS276_SEQ07_Note_By_Secretariat_00.pdf | DS276_SEQ07_Note_By_Secretariat_00.pdf | 7 | Note_By_Secretariat | Constitution of the Panel Established at the Request of the United States Note by the Secretariat | NUMBERED | null | 0 | CANADA - MEASURES RELATING TO EXPORTS OF WHEAT AND TREATMENT OF IMPORTED GRAIN | 13 May 2003 | WT/DS276/7; WT/DS276/6; WT/DS276/6 | ['U.S.'] | ['Canada'] | ['Australia', 'Chile', 'China', 'Taiwan', 'EU', 'Japan', 'Mexico'] | Appellate Body | Art. XVII:1, III:4 GATT 1994Art. 2 Trade-Related Investment Measures (TRIMs) | The summary below was up-to-date at
24 February 2010
See also: One-page summary of key findings of this dispute
Consultations
Complaint by the United States.
On 17 December 2002, the United States requested
consultations with Canada as regards matters concerning the export of
wheat by the ... | 1 | CANADA - MEASURES RELATING TO EXPORTS OF WHEAT
AND TREATMENT OF IMPORTED GRAIN
Constitution of the Panel Established at the Request of the United States
Note by the Secretariat
1. At its meeting on 31 March 2003 (WT/DSB/M/ 146), the Dispute Settlement Body (DSB)
established a panel pursuant to the request made by the U... | 2026-03-15T15:46:58.894118 |
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