01-29140. WTO Dispute Settlement Proceeding Brought by Brazil Regarding Antidumping Duties Imposed by the United States on Silicon Metal From Brazil

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 1, 2001, the United States received from Brazil a revised request for consultations under the Marrakesh Agreement Establishing the World Trade Organization (WTO Agreement) pertaining to certain measures regarding antidumping methodology as applied by the U.S. Department of Commerce (DOC) in its administrative review of an antidumping duty order on silicon metal from Brazil. This revised request replaces a request received from Brazil on September 21, 2001 (see notice published in the Federal Register on October 9, 2001, titled “WTO Dispute Settlement Proceeding Brought by Brazil Pertaining to Certain Measures Regarding Antidumping Methodology”). Brazil alleges that:

• The DOC's administrative review is inconsistent with Articles 5, 9, and 11 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Antidumping Agreement, or ADA). According to Brazil, current U.S. methodology pursuant to which the DOC applies a de minimis standard of 0.5 percent in reviews is inconsistent insofar as these provisions allegedly require a 2 percent de minimis standard to be applied to both investigations and reviews; and
• The DOC's administrative review is also inconsistent with Article 2 of the ADA. Brazil alleges that the DOC's practice of “zeroing”, when calculating the dumping margin, is disallowed in reviews as well as in investigations.

USTR invites written comments from the public concerning the issues raised in this dispute. Persons who submitted comments in response to the earlier notice in the Federal Register published on October 9, 2001, regarding this dispute are requested to resubmit their comments in accordance with the instructions given below.

DATES:

Although USTR will accept any comments received during the course of the dispute settlement process, comments should be submitted on or before December 6, 2001, to be assured of timely consideration by USTR.

ADDRESSES:

We strongly encourage the public to submit comments by email to [e-mail], or by fax to [phone]. Alternatively, comments may be submitted by U.S. mail, first class, postage prepaid, to Sandy McKinzy, Attn: Brazil Silicon Metal Dispute, Office of the United States Trade Representative, 600 17th Street, NW., Washington, DC 20508. Comments delivered by messenger or commercial overnight delivery service will not be accepted.

FOR FURTHER INFORMATION CONTACT:

Katharine J. Mueller, Assistant General Counsel, Office of the United States Trade Representative, 600 17th Street, NW., Washington, DC, [phone].

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 submits or 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 (DSU). 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 Brazil

Section 213 of the URAA (amending Section 733(b)(3) of the Tariff Act of 1930) provides, in accordance with Article 5.8 of the ADA, that, for purposes of antidumping investigations, a dumping margin less than or equal to 2 percent is de minimis. However, section 351.106(c) of the DOC's regulation, 19 CFR 351.106(c), applies a 0.5 percent de minimis standard in the case of “sunset” reviews, which are conducted for purposes of determining whether an antidumping duty order should be revoked. In the eighth administrative review of a 1991 antidumping duty order on silicon metal from Brazil, notice of which was published in the Federal Register on February 23, 2001, the DOC calculated a dumping margin of 0.63 percent for one of the Brazilian importers. Using the 0.5 percent de minimis standard, DOC determined that the requirement for revocation was not met because the dumping margin exceeded the de minimis standard. Brazil claims that this determination violates the ADA because, according to Brazil, the ADA requires that the 2 percent standard must be used in both investigations and reviews.

Brazil also argues that the method by which the 0.63 percent dumping margin was calculated is inconsistent with the ADA because it is a result of the DOC's use of “zeroing”. Chapter 6 of the DOC's Antidumping Manual and Sections 771(35)(A) and (B) of the Tariff Act of 1930 prescribe the use of “zeroing”, according to which negative dumping margins are counted as “zero” in both investigations and reviews. Brazil claims that “zeroing” is inconsistent with the principle of fair comparison set out in Article 2 of the ADA. Brazil points out that the panel in European Communities—Anti-Dumping Duties on Imports of Cotton-Type Bed Linen from India, WT/DS141/R, concluded that “zeroing” is inconsistent with the ADA, and that this finding was affirmed by the Appellate Body, Wt/DS141/AB/R.

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, if sent by U.S. mail, provided in fifteen copies. Commenters are requested not to submit any confidential information at this time. All comments submitted will be made available to the public.

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, which is located at 1724 F Street, NW., Washington, DC 20508. The public file will include comments received by USTR from the public with respect to the dispute; if a dispute settlement panel is convened, the U.S. submissions to that panel, 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 panel; and, if applicable, the report of the Appellate Body. An appointment to review the public file (Docket WTO/DS-239, Brazil Silicon Metal Dispute) may be made by calling Brenda Webb, [phone]. 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.

A. Jane Bradley,

Assistant United States Trade Representative for Monitoring and Enforcement.