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WTO Corner: Brussels appeals into void in Russia case, EU steel safeguard goes to court

MPIA state of play

EU appeals ‘into void’ in Russia anti-dumping dispute

To many, the move will seem highly ironic.

The EU is not pleased with a July WTO panel ruling regarding anti-dumping duties on ammonium nitrate and steel pipes in a case filed by Russia – so it is appealing the case ‘into the void’.

The panel ruling has systemic implications for the way Brussels calculates injury and hence the level of punitive import duties in anti-dumping cases.

Going further than other WTO rulings that had slapped the EU on the wrist regarding the way it handled trade defence cases, this summer’s Russia ruling says there is something systematic in the way the EU determines duties. Indeed, the ruling found the EU’s “Cost Adjustment Methodology” is “a measure of general and prospective application.”

In normal circumstances, the EU would have gone to the Appellate Body. But readers will know that the appeals mechanism of the WTO is not functioning as its members were not renewed due to United States opposition.

The EU has championed a stop-gap alternative appeal mechanism, the MPIA – see membership as of today in the graph above.

The MPIA was established precisely to avoid any proceedings to be caught in limbo due to a party appealing to an institution that is not functioning and so de facto blocking legal proceedings and stopping a counterpart from having its rights enforced.

The EU is also preparing legislation that would allow Brussels to retaliate unilaterally should a WTO member that is not party to the MPIA or has not agreed to any other bilateral appeals mechanism to appeal ‘into the void’ at the WTO.

Russia had considered joining the MPIA, but appears to have lost interest.

And now the EU has decided not to play it nice: it is behaving the very way it doesn’t want other WTO members to behave by resorting to an appeal that will block proceedings with Russia.

Panel on EU steel safeguard requested by Turkey to proceed

Turkey is suing the EU over its revised steel safeguard (background here). Ankara’s second request for a panel was accepted at today’s dispute settlement body meeting in Geneva.

The case is raising a lot of interest, as the United States, Switzerland, Norway, the United Kingdom, Ukraine, Russia, Argentina, Canada, China, Korea, Japan, Brazil, and India all reserved their third party rights to participate in the proceedings.

Note that Turkey has not signed on the MPIA either…

In case you missed it: Canada wins US softwood lumber case

The WTO’s panel report indicted once more time some well-known US antidumping methodologies such as zeroing and the way it took into account price information provided by Canada.

This ruling will not further endear the WTO to the US nor is it helping improve US-Canada relations. But we are now used to it.

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