A World Trade Organization (WTO) Arbitrator, on May 3, 2012, issued his decision regarding the "reasonable period of time" for the implementation of Dispute Settlement Body recommendations and rulings in the dispute over outlawed Chinese countervailing and anti-dumping duties on Grain Oriented Flat-Rolled Electrical Steel (GOES) from the United States.

GOES is a high-tech, high-value magnetic specialty steel that is used primarily by the power generating industry in transformers, rectifiers, reactors, and large electrical machines.

China had imposed anti-dumping and countervailing duties, alleging that American GOES manufacturers were being given subsidies by the US Government; in particular through the "Buy America" provisions of the American Recovery and Reinvestment Act of 2009 and also state government procurement laws.

In September 2010, the US requested consultations with China with respect to the imposition of the duties on GOES, following a final determination released by the Chinese Ministry of Commerce (MOFCOM) in April that year. In its determination, MOFCOM calculated ad valorem subsidy rates of 11.7 percent and 12 percent for the respondent companies, and dumping margins of 7.8 percent and 19.9 percent.

A WTO panel was established in March 2011 when negotiations failed, and its findings were published in June 2012. It agreed with the majority of the United States' arguments that China had failed to properly assess the impact of the US measures, and did not adequately communicate what data had been used when calculating margins in its final determination. The panel also agreed China had failed to adequately demonstrate that US dumped and subsidized imports had had a significant price effect, and had caused injury to Chinese exporters.

China brought an appeal to the WTO Appellate Body in July 2012, arguing that the WTO panel's findings had been erroneous. However, the Appellate Body rejected all of MOFCOM's legal arguments in October 2012, finding no basis to reverse the panel's decision in the case.

At the Dispute Settlement Body's meeting on November 30, 2012, China stated that it intended to implement the DSB recommendations and rulings in a manner that respects its WTO obligations. China added that it would need a reasonable period of time to do so.

On February 8, 2013, the United States requested that the reasonable period of time be determined through binding arbitration pursuant to Article 21.3(c) of the DSU. On 22 February 2013, the United States requested the Director-General to appoint the arbitrator.

Now, the arbitrator appointed to determine the "reasonable period of time" that should be granted to China to comply with the ruling, Claus-Dieter Ehlermann, determined that China must adhere to the ruling, and in particular that China must revoke the duties, within 8 months and 15 days from the adoption of the Panel and Appellate Body Reports, that is, by July 31, 2013.


 

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