WTO Consultations Regarding Countervailing Duty Measures Concerning Certain Products From the European Communities

AGENCY:

Office of the United States Trade Representative.

ACTION:

Notice; request for comments.

SUMMARY:

The Office of the United States Trade Representative (USTR) is providing notice that on November 13, 2000, the United States received from the European Communities (EC) a request for consultations under the Marrakesh Agreement Establishing the World Trade Organization (WTO Agreement). The request relates to the continued application by the United States of countervailing duties based upon the “change in ownership” methodology used by the U.S. Department of Commerce (Commerce). The measures identified by the EC (including the relevant Commerce case number) are as follows:

• Original Imposition of Countervailing Duties
• Stainless Steel Sheet and Strip in Coils from France (C-427-815)
• Certain Cut-to-Length Carbon Quality Steel from France (C-427-817)
• Certain Pasta from Italy (C-475-819)
• Stainless Steel Sheet and Strip in Coils from Italy (C-475-825)*
• Certain Stainless Steel Wire Rod form Italy (C-475-821)*
• Stainless Steel Plate in Coils from Italy (C-475-823)*
• Certain Cut-to-Length Carbon-Quality Steel Plate from Italy (C-475-827)

(With respect to those cases marked with an asterisk, the correct case numbers are provided, as opposed to the incorrect case numbers included in the EC's request for consultations.)

• Administrative Reviews
• Cold-Rolled Carbon Steel Flat Products from Sweden (C-401-401)
• Cut-to-Length Carbon Steel Plate from Sweden (C-401-804)
• Grain-Oriented Electrical Steel from Italy (C-475-812)

(With respect to case C-475-812, the EC consultation request identifies the “Preliminary determination, plus final sunset results”.)

• Sunset Reviews
• Cut-to-Length Carbon Steel Plate from the United Kingdom (C-412-815)
• Certain Corrosion-Resistant Carbon Steel Flat Products from France (C-427-810)
• Cut-to-Length Carbon Steel Plate from Germany (C-428-817)
• Cut-to-Length Carbon Steel Plate from Spain (C-469-804)

The EC alleges that the continued application of Commerce's change in ownership methodology in these countervailing duty proceedings violate Articles 10, 19 and 21 of the WTO Agreement on Subsidies and Countervailing Measures (SCM Agreement), because, according to the EC, there is no proper determination of a benefit to the producer of the goods under investigation, as required by Article 1.1(b) of the SCM Agreement. Under Article 4.3 of the WTO Dispute Settlement Understanding (DSU), consultations are to take place within a period of 30 days from the date of receipt of the request, or within a period otherwise mutually agreed between the United States and the EC. USTR invites written comments from the public concerning the issues raised in this dispute.

DATES:

Although USTR will accept any comments received during the course of the dispute settlement proceedings, comments should be submitted on or before January 15, 2001, to be assured of timely consideration by USTR.

ADDRESSES:

Submit comments to Sandy McKinzy, Monitoring and Enforcement Unit, Office of the General Counsel, Room 122, Office of the United States Trade Representative, 600 17th Street, NW., Washington, DC, 20508, Attn: Change in Ownership Methodology Dispute. Telephone: (202) 395-3582.

FOR FURTHER INFORMATION CONTACT:

William D. Hunter, Associate General Counsel, Office of the United States Trade Representative, 600 17th Street, NW., Washington, DC, 20508. Telephone: (202) 395-3582.

SUPPLEMENTARY INFORMATION:

Section 127(b) of the Uruguay Round Agreements Act (URAA) (19 U.S.C. 3537(b)(1)) requires that notice and opportunity for comment be provided after the United States receives a request for the establishment of a WTO dispute settlement panel. Consistent with this obligation, but in an effort to provide additional opportunity for comment, USTR is providing notice that consultations have been requested pursuant to the WTO Dispute Settlement Understanding. If such consultations should fail to resolve the matter and a dispute settlement panel is established pursuant to the DSU, such panel, which would hold its meetings in Geneva, Switzerland, would be expected to issue a report on its findings and recommendations within six to nine months after it is established.

Major Issues Raised by the EC

In its consultation request, the EC alleges that in United States—Imposition of Countervailing Duties on Certain Hot-Rolled Lead and Bismuth Carbon Steel Products, WT/DS138/AB/R, the WTO Appellate Body found Commerce's change in ownership methodology to be inconsistent with the SCM Agreement. The EC also alleges that the Appellate Body found that a change of ownership at fair market value eliminated the benefit of any prior subsidies to the privatized company. Therefore, the EC alleges that the continued application of Commerce's change in ownership methodology, and the continued imposition of countervailing duties based upon that methodology, violate Articles 10, 19 and 21 of the SCM Agreement. According to the EC, if the United States had properly examined the nature of the change in ownership in each of the countervailing duty proceedings identified in the EC's request for consultations, the amount of countervailing duty would have been greatly reduced or, in some cases, found to be zero.

Public Comment: Requirements for Submissions

Interested persons are invited to submit written comments concerning the issues raised in the dispute. Comments must be in English and provided in fifteen copies. A person requesting that information contained in a comment submitted by that person be treated as confidential business information must certify that such information is business confidential and would not customarily be released to the public by the commenter. Confidential business information must be clearly marked “BUSINESS CONFIDENTIAL” in a contrasting color ink at the top of each page of each copy.

Information or advice contained in a comment submitted, other than business confidential information, may be determined by USTR to be confidential in accordance with section 135(g)(2) of the Trade Act of 1974 (19 U.S.C. 2155(g)(2)). If the submitter believes that information or advice may qualify as such, the submitter—

(1) Must so designate the information or advice;

(2) Must clearly mark the material as “SUBMITTED IN CONFIDENCE” in a contrasting color ink at the top of each page of each copy; and

(3) Is encouraged to provide a non-confidential summary of the information or advice.

Pursuant to section 127(e) of the URAA (19 U.S.C. 3537(e)), USTR will maintain a file on this dispute settlement proceeding, accessible to the public, in the USTR Reading Room: Room 101, Office of the United States Trade Representative, 600 17th Street, N.W., Washington, D.C. 20508. The public file will include a listing of any comments received by USTR from the public with respect to the proceeding; the U.S. submissions to the panel in the proceeding, the submissions, or non-confidential summaries of submissions, to the panel received from other participants in the dispute, as well as the report of the dispute settlement panel, and, if applicable, the report of the Appellate Body. An appointment to review the public file (Docket WTO/D-212, Change in Ownership Methodology Dispute) may be made by calling Brenda Webb, (202) 395-6186. The USTR Reading Room is open to the public from 9:30 a.m. to 12 noon and 1 p.m. to 4 p.m., Monday through Friday.