United States — Definitive Safeguard Measures on Imports of Steel Wire Rod and Circular Welded Quality Line Pipe

Summary up-to-date at 30 May 2008  

Panels established by DSB/reports not yet circulated

Complaint by the European Communities.

On 30 November 2000, the EC requested consultations with the US on US safeguard legislation and its application in two cases concerning the definitive safeguard measures imposed by the US on imports of certain steel wire rod (“wire rod”) and certain circular welded carbon quality line pipe (“line pipe”). In particular, the EC considered as follows:

•    Sections 201 and 202 of the Trade Act of 1974 contain provisions relating to the determination of a causal link between increased imports and injury or threat thereof which prevented the US from respecting Articles 4 and 5 of the Safeguards Agreement.

•    Section 311 of the NAFTA Implementation Act contains provisions concerning imports originating in NAFTA countries which do not respect the requirement of parallelism between the imported products subject to the investigation and the imported products subject to the safeguard measure, contrary to Articles 2, 4 and 5 of the Safeguards Agreement.

•    These provisions are in breach of the Most-Favoured-Nation principle under Article I of the GATT 1994.

According to the EC, these violations are confirmed by the application of the aforesaid US provisions in two specific cases where the US imposed definitive safeguard measures, (1) in the form of a tariff rate quota on imports of wire rod effective as of 1 March 2000; and (2) in the form of an increase in duty on imports of line pipe effective as of 1 March 2000.In the EC’s view, in both the above mentioned cases the US measures are in breach of the US obligations under the provisions of GATT 1994 and of the Safeguards Agreement, in particular, but not necessarily exclusively, of: Article 2 Safeguards Agreement; Articles 3.1 and 3.2 Safeguards Agreement; Articles 4.1 and 4.2 Safeguards Agreement; Article 5.1 Safeguards Agreement; Article 8.1 Safeguards Agreement; Articles 12.2, 12.3 and 12.11 Safeguards Agreement; Article I:1 of GATT 1994; Article XIX:1 of GATT 1994.

Further to the request of the EC, the DSB established a panel at its meeting of 10 September 2001. Argentina, Canada, Japan, Korea and Mexico reserved their third-party rights. The Panel has not yet been composed.