Bridges Trade BioRes • Volume 6 • Number 8 • 28th May 2006

Thailand Files New Complaint at WTO on US Shrimp Duties

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On 24 April, Thailand filed a request for consultations under the WTO Dispute Settlement Understanding regarding the antidumping measures that have been imposed by the US against shrimp from Thailand since January 2005 (see Bridges Trade BioRes, 11 November 2005). The consultations will attempt to address Thailand’s complaints against the US’ use of a ‘zeroing’ methodology to calculate anti-dumping duties and its bond requirement. Thailand has argued that zeroing is inconsistent with the WTO Anti-dumping Agreement because it distorts the determination of dumping margins by leaving out negative dumping margins and only including positive dumping margins when calculating anti-dumping duties (see Bridges Trade BioRes, 25 November 2005). A WTO Appellate Body ruling released on 18 April has indicated that the US zeroing methodology is WTO-illegal, a finding that Thailand will undoubtedly draw upon. Additionally, Thailand has charged that the US requirement that exporters give the US government more than 10 percent of the value of annual exports for holding for a year (the “bond”) is not allowed by the WTO. In particular, they challenged an amendment that would calculate the required bond amount using a formula based on the value of imports of the product over the previous twelve months. The new case is the third that has been filed at the WTO regarding the US anti-dumping measures on shrimp. Thailand filed a first request in December 2004 (WT/DS/343/1), but as it was limited to the zeroing complaint and did not include the bond complaint Thailand decided to file this new, second case. Similarly, in November 2005 Ecuador filed a complaint with the WTO on the use of zeroing in calculating the shrimp duties, on which negotiations have been proceeding on the sidelines of the US-Ecuador free trade agreement talks. Dozens of exporting companies from Brazil, China, Ecuador, India, Thailand and Vietnam have asked for the duties that were imposed on their countries in January 2005 to be reviewed by the US Department of Commerce (see Bridges Trade BioRes, 3 April 2006). As well, India is currently involved in legal proceedings before a US Federal Court where they are addressing issues similar to those raised by Thailand.

According to WTO dispute settlement procedures, the parties now have 60 days to complete the consultations after which, if unsuccessful, Thailand can file a request for the establishment of a panel.

ICTSD Reporting.