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China - GOES

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by

Mateo Ferrero

on 28 June 2013

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Transcript of China - GOES

Product and measure at issue
China - GOES
Steel
Global steel market
Market
China appeals the Panel's findings regarding the
price effects analysis
:
Articles 3.1 and3.2 of the ADA and 15.1 and 15.2 of the SCM
Article 11 of the DSU in reaching its findings under Articles 3.2 of the ADA and 15.2 of the SCM
Articles 6.9 of the ADA and 12.8 of the SCM
Articles 12.2.2 of the ADA and 22.5 of the SCM
Issues raised on appeal
Legal instruments
AD and CVD in China
Stages of the AD and CVD investigation and claims brought before the Panel by the United States
Notice No. 21 of 2010
How is it made?
How is GOES manufactured?
Electrical Steel
An alloy
Steel is the world's most important engineering and construction material
What is it used for?
Grain oriented flat-rolled electrical steel
GOES
NGOES
Silicon is added during the steel making process and steel acquires magnetic properties
Magnetic properties are oriented in a single direction
No preferential direction for magnetization
Permits easy magnetization along the length of the steel
+
Silicon level: 3%
Silicon level varies
What is Steel?
How is steel manufactured?
Global GOES market
GOES market in China
GOES market in the US
Source: "World Steel in Figures 2012", World Steel Association
Global steel sales in 2010 amounted to USD 960 billion.
Steel industry employs directly 2 million people
Biggest producer and consumer: China
Global Steel Market
Although the production figures seem “small”, GOES is a high value, specialized niche product that is almost six times the price of other steel products
Despite the constant increase in GOES production, the demand for GOES has consistently outpaced supply
Shortage 200,000 tons/year
Global GOES market
Global GOES Producers
Electrical steel production in 2008: 13.3 m/tonnes = 1% of global steel market
GOES production in 2008: 2.16 m/tonnes
= 16% electrical steel = 0.2% of total steel
Global GOES Market
Tremendous growth in recent years
High demand has stimulated both domestic production and imports
Imported GOES has a small market share compared to domestically produced GOES
GOES Market in China
In the last decade, the price of GOES in the US has outperformed the price of other types of steel
The fall in GOES prices due to the crisis in 2008 was somewhat offset by increasing demand for GOES in China and India
GOES Market in the US
Relevant GOES producers
Wisco
AK Steel
ATI
Baosteel
83,000 employees
Produces a wide range of steel products, including electrical steel products in the form of both GOES and NGOES.
Currently, more than half of electrical steel demand in China is met by WISCO.
In 2009, WISCO produced 440,000 tonnes of GOES, making it the largest producer of GOES in the world
Wuhan Iron and Steel Company (WISCO)
State-owned
China’s largest producers of iron and steel products
118,500 employees
Focuses on producing high-tech, high added value steel products, including electrical steel
In 2009, Baosteel produced 90,000 tonnes of GOES
BAOSTEEL
Publicly traded company
8,400 employees
AK Steel produces flat rolled carbon, stainless, and electrical steel products (GOES and NGOES)
2011 revenues were USD 6.5 billion
AK Steel
Publicly traded company
11,500 employees
ATI's range of products includes stainless, specialty steel products and electrical steel.
ATI is the only electrical steel manufacturer that produces GOES but does not produce NGOES.
2011 revenues were USD 5.3 billion
Allegheny Ludlum (ATI)
Foreign Trade Law
Anti-Dumping Regulation and Countervailing Regulation
Rules
State Council
People's Congress
MOFCOM
Authorities
Investigation
Imposition of duties
MOFCOM
BOFT
BIII
Dumping and Subsidization Determination
Injury and Causation Determination
Customs Tariff Commission of the State Council
AD and CVD practices in China
China has recently become more active in the use of anti-dumping measures


Main target countries: Japan, United States, Korea and Chinese Taipei
Main target products: chemical products (58% of the total), and the category of resins, plastics and rubbers (26% of the total)
Anti-Dumping Practices in China
China has been much less active in its use of countervailing measures
China has only initiated 4 countervailing investigations
Countervailing Practices in China
WTO disputes involving Chinese AD/CDVs
27.04.09
Application for initiation of AD/CVD
MOFCOM initiates investigation (CVD covers 22 of 27 laws)
01.06.09
MOFCOM provides notice of initiation
01.06.09
MOFCOM issues subsidy questionnaires
26.06.09
Petitioners file new subsidy allegations with respect to 10 laws
20.07.09
MOFCOM initiates CVD investigation on 6 of these laws
19.08.09
MOFCOM publishes Preliminary Determination
10.12.09
MOFCOM releases Final Disclosure Document to respondents
MOFCOM issues Injury Disclosure Document
05.03.10
MOFCOM issues Final Determination
10.04.10
27.04.09
Application for initiation of AD/CVD
MOFCOM initiates investigation (CVD covers 22 of 27 laws)
01.06.09
MOFCOM provides notice of initiation
01.06.09
MOFCOM issues subsidy questionnaires
26.06.09
Petitioners file new subsidy allegations with respect to 10 laws
20.07.09
MOFCOM initiates CVD investigation on 6 of these laws
19.08.09
MOFCOM publishes Preliminary Determination
10.12.09
MOFCOM releases Final Disclosure Document to respondents
MOFCOM issues Injury Disclosure Document
05.03.10
MOFCOM issues Final Determination
10.04.10
Initiation of the AD and CVD investigation
Initiation of investigation
The United States argues that China acted inconsistently with
Articles 11.2 and 11.3 of the SCM Agreement
in initiating an investigation with respect to 11 programmes included in the applications
Application and Initiation of the investigations
The United States argues that China acted inconsistently with
Articles 6.5.1 of the Anti-Dumping Agreement and 12.4.1 of the SCM Agreement
because the applicants did not provide adequate non-confidential summaries of certain confidential information
27.04.09
Application for initiation of AD/CVD
MOFCOM initiates investigation (CVD covers 22 of 27 laws)
01.06.09
MOFCOM provides notice of initiation
01.06.09
MOFCOM issues subsidy questionnaires
26.06.09
Petitioners file new subsidy allegations with respect to 10 laws
20.07.09
MOFCOM initiates CVD investigation on 6 of these laws
19.08.09
MOFCOM publishes Preliminary Determination
10.12.09
MOFCOM releases Final Disclosure Document to respondents
MOFCOM issues Injury Disclosure Document
05.03.10
MOFCOM issues Final Determination
10.04.10
Claims with respect to known exporters
Public Notice on Preliminary and Final Determination
The United States argues that China acted inconsistently with
Article 22.3 of the SCM Agreement
because it failed to adequately explain why the exclusion of foreign producers from the competitive bidding process under the United States government procurement statutes led to the conclusion that the resulting prices were not market prices for the purposes of the benefit determination
Preliminary and Final Determination
The United States argues that MOFCOM's reliance on facts available in its benefit determination under the government procurement programmes was improper in a manner inconsistent with
Article 12.7 of the SCM Agreement
. In particular, the United States' challenge is based on: (i) MOFCOM's decision to resort to facts available; and (ii) MOFCOM's application of a 100% utilization rate after determining the extent to which the respondents' domestic sales of GOES and non-GOES products were subsidized
Public Notice on Final Determination
The United States argues that MOFCOM did not disclose, in the public notice, the data and calculations it used to arrive at the dumping margins for AK Steel and ATI and thus, acted inconsistently with
Article 12.2.2 of the Anti-Dumping Agreement
Stages of the AD and CVD investigation
27.04.09
Application for initiation of AD/CVD
MOFCOM initiates investigation (CVD covers 22 of 27 laws)
01.06.09
MOFCOM provides notice of initiation
01.06.09
MOFCOM issues subsidy questionnaires
26.06.09
Petitioners file new subsidy allegations with respect to 10 laws
20.07.09
MOFCOM initiates CVD investigation on 6 of these laws
19.08.09
MOFCOM publishes Preliminary Determination
10.12.09
MOFCOM releases Final Disclosure Document to respondents
MOFCOM issues Injury Disclosure Document
05.03.10
MOFCOM issues Final Determination
10.04.10
Claims with respect to unknown exporters
Notice of Initiation, Preliminary and Final Determination
The United States argues that China acted inconsistently with
Article 6.8 and paragraph 1 of Annex II of the Anti-Dumping Agreement
in using facts available to calculate the dumping margins for unknown exporters.
The United States argues that China acted inconsistently with
Article 12.7 of the SCM Agreement
in using facts available to calculate the subsidy rate for unknown exporters.
Final Disclosure Document
The United States contends that MOFCOM failed to inform interested parties of the essential facts under consideration in calculating the "all others" dumping margin of 64.8% in a manner inconsistent with
Article 6.9 of the Anti-Dumping Agreement
.
The United States alleges that China acted inconsistently with
Article 12.8 of the SCM Agreement
in failing to disclose certain essential facts underlying its decision to apply an "all others" subsidy rate of 44.6%.
Public Notice on Final Determination
The United States argues that, by not providing in the public notice the factual and legal basis underlying MOFCOM's resort to facts available for the purposes of calculating the "all others" dumping rate for unknown exporters, China acted inconsistently with its obligations under
Articles 12.2 and 12.2.2 of the Anti-Dumping Agreement
.
The United States argues that China acted inconsistently with
Articles 22.3 and 22.5 of the SCM Agreement
because MOFCOM did not provide in the public notice any rationale for its decision to apply adverse facts available to "all other" United States producers/exporters of GOES, and did not include information on the facts and reasons leading to the determination of the "all others" subsidy rate of 44.6%.
27.04.09
Application for initiation of AD/CVD
MOFCOM initiates investigation (CVD covers 22 of 27 laws)
01.06.09
MOFCOM provides notice of initiation
01.06.09
MOFCOM issues subsidy questionnaires
26.06.09
Petitioners file new subsidy allegations with respect to 10 laws
20.07.09
MOFCOM initiates CVD investigation on 6 of these laws
19.08.09
MOFCOM publishes Preliminary Determination
10.12.09
MOFCOM releases Final Disclosure Document to respondents
MOFCOM issues Injury Disclosure Document
05.03.10
MOFCOM issues Final Determination
10.04.10
Claims with respect to the price effects analysis
Final Determination
The United States argues that MOFCOM's finding that the dumped and subsidized imports had significant price effects, in particular price undercutting, price depression and price suppression, fails to reflect an objective examination of the evidence and is not based on positive evidence, contrary to
Articles 3.1 and 3.2 of the Anti-Dumping Agreement
, and
Articles 15.1 and 15.2 of the SCM Agreement
Final Injury Disclosure Document
The United States contends that the price effects analysis is inconsistent with
Article 12.8 of the SCM Agreement
and
Article 6.9 of the Anti-Dumping Agreement
because MOFCOM did not disclose the essential facts underlying the price effects analysis
Final Determination (Public Notice )
The United States alleges that China acted inconsistently with
Article 22.5 of the SCM Agreement
and
Article 12.2.2 of the Anti-Dumping Agreement
because the public notice on its final determination did not contain sufficient information regarding its price effects analysis
27.04.09
Application for initiation of AD/CVD
MOFCOM initiates investigation (CVD covers 22 of 27 laws)
01.06.09
MOFCOM provides notice of initiation
01.06.09
MOFCOM issues subsidy questionnaires
26.06.09
Petitioners file new subsidy allegations with respect to 10 laws
20.07.09
MOFCOM initiates CVD investigation on 6 of these laws
19.08.09
MOFCOM publishes Preliminary Determination
10.12.09
MOFCOM releases Final Disclosure Document to respondents
MOFCOM issues Injury Disclosure Document
05.03.10
MOFCOM issues Final Determination
10.04.10
Claims with respect to the causation analysis
Final Determination
The United States challenges two aspects of MOFCOM's causation analysis as inconsistent with
Articles 3.1 and 3.5 of the Anti-Dumping Agreement
and
Articles 15.1 and 15.5 of the SCM Agreement
: MOFCOM's use of price effects findings and MOFCOM's examination of the domestic industry's increase in capacity and production as a potential alternative cause of injury
Final Injury Disclosure Document
The United States argues that China acted inconsistently with
Article 12.8 of the SCM Agreement
and
Article 6.9 of the Anti-Dumping Agreement
in failing to disclose the essential facts under consideration in relation to non-subject imports in its causation analysis
Public Notice on Final Determination
The United States alleges that China acted inconsistently with
Article 22.5 of the SCM Agreement
and
Article 12.2.2 of the Anti-Dumping Agreement
because the public notice on its final determination did not contain information to support MOFCOM's causation analysis with respect to non-subject imports
NGOES
GOES
What are their uses?
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Full transcript