4 - US – Lamb United States – Safeguard Measures on Imports of Fresh, Chilled or Frozen Lamb Meat from New Zealand and Australia: What Should Be Required of a Safeguard Investigation?

Summary

Background

The United States (US) imposed, in July 1999, a safeguard on lamb meat, in the form of tariff rate import quotas, which were to be applied for a period of three years. The measure was based on findings by the US International Trade Commission that increased imports of lamb meat were a substantial cause of threat of serious injury to the US industry producing the like product. Following complaints by New Zealand and Australia that the measure was inconsistent with Articles I, II and XIX of GATT 1994, and several provisions of the Agreement on Safeguards, the World Trade Organization (WTO) Dispute Settlement Body established, in November 1999, a panel to review the consistency of the US measure with the mentioned WTO rules.

The Panel found that:

1. (i)the US had failed to demonstrate that the import surge was the result of unforeseen developments as required by Article 1 SGA, which incorporates by reference Article XIX GATT;

2. (ii)the US had made too broad a definition of domestic industry inconsistent with Article 2.1 and Article 4.1c of the Agreement on Safeguards;

3. (iii)the Complainants failed to establish the deficiency of the methodology employed by the US International Trade Commission to establish threat of serious injury (and hence rejected their claims in this respect);

4. (iv)the US International Trade Commission investigation based its finding on non-representative data, inconsistent with the requirements of the Agreement on Safeguards; and

5. (v)the US International Trade Commission investigation did not establish, as required by Article 4.2 SGA, a causal link between increased imports and the threat of serious injury, nor that this threat could not be attributed to other factors.