ARTICLE 1904
BINATIONAL PANEL REVIEW
UNDER
NORTH AMERICAN FREE TRADE AGREEMENT

SIMA requires the Tribunal to determine whether the domestic industry has suffered material injury. The domestic industry is defined in the legislation as the domestic producers of like goods. Nothing in SIMA or the WTO Anti-dumping Agreement directs the Tribunal to determine whether dumping has materially injured only the domestic production that is related to domestic consumption. I note that section 37.1 of the SIMA Regulations prescribes a number of factors that the Tribunal is to consider in an injury inquiry. Some of these factors clearly relate only to domestic sales for domestic consumption, for example, price and market share. Others, such as export performance, productivity, return on investments, utilization of capacity, employment, inventories or the ability to raise capital, can hardly be evaluated without taking into account the domestic production of like goods in its entirety.³⁵

However, in this matter, and as further elaborated upon in the following section, the Panel finds that the Tribunal majority did in fact consider export performance in making its material injury determination in this case. The Panel also finds that the Tribunal majority correctly defined the “domestic industry” to be evaluated. The Tribunal did consider the impact of imports on the total domestic production of like goods, including production for export. It should be noted however how the Tribunal considers the export performance factor and weighs it against other statutory and regulatory injury factors is a question of fact and would require this Panel to accord to the Tribunal a considerable degree of deference.


ii. The Proper Determination of Injury

WCI and Whirlpool argued that in determining the extent of injury to the domestic industry, the Tribunal examined primarily the marketing and distribution of Camco’s products, Camco’s volume of sales and market share and the price erosion and price suppression experienced by Camco. According to the complainants, the Tribunal failed to consider the entire industry including the industry’s production for export and export performance. In addition, the Tribunal failed to find that injury was predicated on the impact of imports in specific sectors of the domestic market. Furthermore, the Tribunal failed to determine that the injury was causally related to dumped imports.

In the Tribunal’s discussion of “State of the Market and Industry,” the Tribunal explained the factors that it considered in determining whether Camco suffered any injury by reason of subject imports:

Subsection 37.1(1) of the Special Import Measures Regulations prescribes certain factors that the Tribunal may consider in determining whether a domestic industry has been materially injured by dumped imports or whether the dumping is threatening to cause injury. These factors include the volume of dumped goods and their effect on prices in the domestic market for like goods and the consequent impact of these imports on a number of economic factors. In this case, these economic factors include actual or potential declines in domestic sales, market share, domestic prices and financial performance. Subsection 37.1(3) of the SIMA Regulations also requires the Tribunal to consider other factors not related to the dumping, including the volumes and prices for imports of like goods that are not dumped, the export performance of domestic producers and any other factors that are relevant in the circumstances, to ensure that any injury caused by those other factors is not attributed to the dumped imports.³⁶

There is nothing in the Tribunal’s opinion to suggest that the Tribunal majority limited its injury analysis to Camco’s production of like goods for sale to domestic customers. Clearly, the Tribunal considered Camco’s export performance, finding the company to be “profitable and reasonably healthy”³⁷ with respect to export sales of dishwashers and dryers. However, the Tribunal found that dumped imports had injured the domestic industry in specific ways and in specific market sectors.

Thus, for example, the Tribunal noted that the “channels of distribution for the subject goods consist of two main market segments, retail and builder/developer”, with the retail segment accounting for about 80 percent of the total market for refrigerators, 85 percent of the total market for dishwashers and 90 percent of the total market for dryers.³⁸ The balance of the market was found to consist of the “builder/developer” segment, which “includes authorized builder-distributors (ABDs) and direct-to-builder accounts”. The Tribunal found that subject imports had caused material injury in the latter market segment:

The Tribunal believes that much of the injury experienced by Camco occurred in the builder and ABD market segments. WCI came back into the Canadian market in late 1997 and early 1998, following a re-organization with some new, updated and improved products. It introduced these new products with a new approach to marketing that involved building a better relationship with its customers. The evidence shows that dumped product from WCI displaced Camco product at many important ABD accounts, as well as at retail accounts.³⁹

While the Tribunal found Camco’s evidence regarding account-specific injury allegations to be “generally unreliable”, it “was persuaded by the account-specific pricing evidence submitted in response to the Tribunal’s questionnaires and other evidence provided at the hearing”. The Tribunal also found that dumped Whirlpool products had “displaced Camco products at a number of the large retail accounts”, and concluded that “it is clear to the Tribunal that dumped imports displaced Camco product at both retail and builder accounts”.⁴⁰

In addition, the Tribunal’s finding of injury was based largely on its determination that the dumped imports had caused Camco to lose market share. Obviously, market share is one of the factors to be considered in a material injury determination; it is also a factor, which necessarily focuses on the domestic industry’s performance in its domestic market. The Tribunal found that Camco had suffered injury in the form of lost market share made possible by price competition from dumped imports:

Central to the case made by Camco is that the dumped imports forced it to either meet the low-priced dumped imports or to lose sales. In this regard, the Tribunal has addressed the issue of price erosion and price sensitivity of appliances in the Canadian market in order to understand the reasons for Camco’s large loss in market share for each of the separate products (refrigerators, dishwashers and dryers). While the injury suffered by Camco manifested itself primarily as lost sales volume and reduced market share during the Tribunal’s inquiry period, Camco testified that it was forced to lower prices to a certain point and, when it determined its prices could go no lower, it lost sales. In this regard, the Tribunal heard testimony from witnesses representing the retail and ABD segments of the market that verified the presence of aggressively priced imports in the market and the importance of price in terms of their overall purchasing decisions.⁴¹

The Tribunal found that the loss of market share was a severe decline, particularly “for a company like Camco that is smaller relative to its major competitors and, therefore, any loss of market share can have a significant impact on its economics of production”.⁴²

Thus, the Tribunal majority did in fact consider the domestic industry as a whole, including its export production, and evaluated its export performance, as the SIM Regulations require. Equally clear the Tribunal made specific findings that the dumped imports had damaged the domestic industry in specific market sectors, primarily the builder/ABD market, and, to a lesser extent, the retail sector. The injury suffered by the domestic industry manifested itself in the form of lost sales, lost market share, and negative price effects.

Had the Tribunal defined the domestic industry as being limited to production of like products for sale in the Canadian market, the Panel would not hesitate to set such determination aside as legally erroneous. However, careful scrutiny of the majority decision indicates that no such error was committed. The entire industry was considered by the Tribunal, including the industry’s production for export and export performance, and a finding of injury was predicated on the impact of imports in specific sectors of the domestic market. Furthermore, the Tribunal specifically held that the injury was causally related to dumped imports.

The Tribunal majority determined that the positive export performance of the domestic industry did not extirpate the injury to the domestic industry.⁴³ We find no error in this determination. Nothing in SIMA, its implementing regulations or reported precedent suggests that the “material injury” sufficient to sustain an antidumping order must reflect injury suffered by every market sector in which domestic like product is sold, including export market sectors. Furthermore, the Tribunal majority indicated that “in this case”⁴⁴ the domestic industry’s export success should not be weighed against the injury found in sectors of the domestic market. This determination is case-specific and involves a weighing of evidence, which is the prerogative of the Tribunal, and to which this Panel will defer.

The Tribunal took note of the factors prescribed by the SIM Regulations to consider in the injury determination and gave specific attention to Camco’s export performance. Nowhere, however, does SIM Regulations subsection 37.1(3) dictate how the Tribunal must consider or weigh the domestic industry’s export performance. Obviously, the SIM Regulations, which concerns itself with non-dumping causes of injury, seeks to have the Tribunal consider whether a decline in export performance, rather than imports, might be the cause of injury to a domestic industry. However, nowhere does the regulation dictate or even suggest that positive export performance is a factor, which must be weighed against other evidence of injury. The weighing of evidence in each case is an issue of fact, to be scrutinized by the Panel under a deferential standard of review.

The complainants argue that the Tribunal erred in failing to consider the export performance of Camco in evaluating the injury suffered by Camco. They allege that the robust export performance of Camco should have been considered as a positive offsetting factor in the analysis of injury. The relevant provisions of SIMA state:

42(1) The Tribunal …shall make inquiry with respect to such of the following matters as is appropriate in the circumstances:

(a) in the case of any goods to which the preliminary determination applies, as to whether the dumping or subsidizing of the goods;

(i) has caused injury or retardation or is threatening to cause injury;[Emphasis added]

The term ‘injury’ is then defined in subsection 2(1) in the following way:

‘injury’ means injury to a domestic industry;

In turn, ‘domestic industry’ is also defined in the following way in subsection 2(1):

‘domestic industry’ means …the domestic producers as a whole of the like goods or those domestic producers whose collective production of the like goods constitutes a major proportion of the total domestic production of the like goods…[Emphasis added]

The complainants argue that injury must be determined in terms of the domestic production as a whole, in order to support their argument that export performance is a factor in assessing injury from dumping. This is a misreading of the definition of ‘injury’. In fact, injury must be injury to the domestic industry, which is defined as the domestic producers as a whole. It is erroneous to argue that it is domestic production as a whole that must be considered.

In statutory interpretation, there is a difference between domestic producers and domestic production. This difference must be understood in order to determine the proper meaning of subsection 42(1) of SIMA. The term ‘domestic producers’ refers to the producers in the domestic industry. The purpose in SIMA of defining ‘domestic industry’ in terms of ‘domestic producers as a whole’ is to ensure that the producers seeking relief from injurious dumping will represent the major proportion of the domestic industry. By comparison, the term ‘domestic production’ implies all of the production that happens in the country. This term would seem to include--as the complainants argue--all the production in a country, including domestic sales and exports. However, in SIMA the words ‘domestic production’ are used in the definition of domestic industry only to modify the term ‘domestic producers’. Nowhere does the section say that domestic industry is defined as all domestic production. Clearly, domestic industry is defined in reference to domestic producers, not to domestic production.

In this case, Camco is the only domestic producer. Thus, there is injury to the domestic industry from dumping to the extent that Camco is injured by that dumping. There is no indication that domestic production ‘as a whole’ must be injured; rather ‘domestic producers as a whole’ must be injured. It is possible to injure a producer by only injuring one part of its business. The Tribunal found that Camco was injured by dumping by loss of market share in the Canadian market.

With regard to subsection 37.1 of SIM Regulations, the complainants have misconstrued the import of this provision. Subsection 37.1(1) prescribes a lengthy list of factors that must be examined to determine whether dumped goods have caused injury. These factors include, for example, any actual or potential decline in market share. Further guidance in the assessment of injury is provided in subsection 37.1(3), as follows:

37.1(3) For the purpose of determining whether the dumping or subsidizing of any goods has caused injury or retardation, or is threatening to cause injury, the following additional factors are prescribed:
…

(b) whether any factors other than the dumping or subsidizing of the goods have caused injury or retardation or are threatening to cause injury, on the basis of

…

(vi) the export performance and productivity of the domestic industry in respect of like goods, and

(vii) any other factors that are relevant in the circumstances.[Emphasis added]

The purpose of subsection 37.1(3) is to ensure that the Tribunal turns its mind to other factors besides dumping that may cause injury to the domestic industry. If it is found that one of the factors enumerated in subsection 37.1(3) has caused some injury, then the Tribunal must ensure that this injury is not attributed to dumping. This step is necessary to ensure that it was in fact the dumping that caused the injury to the domestic industry and not the non-dumping factors that are the explanation for the decline in market share, or price, etc. Thus, what the Tribunal was obliged to do was to consider export performance, among other things, to ensure that these factors were not the cause of the injury suffered by the domestic industry.

The complainants are correct to argue that subsection 37.1(3) obliges the Tribunal to consider export performance in determining if there has been injury to the domestic industry. However, it is incorrect to argue, as the complainants have done, that the Tribunal must consider export performance in assessing injury from dumping, either to add to injury from dumping if export performance is poor, or to subtract from injury from dumping if export performance is good. SIMA only requires the consideration of export performance for the purposes of determining if the injury to the domestic industry was caused by factors other than the dumping. This is the only positive duty to consider export performance that exists in the relevant sections of SIMA and its regulations. Clearly, SIM Regulations 37.1(3) cannot be interpreted in a way that would create a positive obligation to include export performance in the determination of whether or not there is injury from dumping. In fact, export performance must be considered in order to separate potential injury caused by poor export performance, from injury caused by dumping.⁴⁵

The above conclusion is consistent with earlier views expressed by the CITT. For example, in Iodinated Contrast Media that was cited by the complainants the majority stated:

In the Tribunal’s view, the effects of the domestic industry’s export performance, albeit favourable, does not negate the material injury caused directly by the dumping of the subject goods through price erosion and lost sales in the domestic market.⁴⁶

The Tribunal then goes on to cite a previous case⁴⁷ where it had already addressed the issue of export performance:

In that case, exports “in the view of the Tribunal, [were] unrelated to the issues of dumping into Canada and of injury to domestic production. Moreover, and notwithstanding repeated statements that the car industry is a North American industry which encompasses exports and imports on the basis of rationalized production, GM Canada, and Ford Canada centred their case on, and counsel argued that the complainants were concerned with injury to domestic production for domestic consumption. The Tribunal agrees with this position.” The Tribunal adopts this position in the present case, a position that reflects the Tribunal’s practice and established jurisprudence since the Cars case.⁴⁸

Two conclusions can be drawn from the above analysis. First, the Tribunal did not err in considering domestic production for domestic consumption in determining if there was injury caused by dumping. Having found that there was injury caused by dumping, the Tribunal correctly went on, as it is obliged to do in SIM Regulations subsection 37.1(3), to consider whether the injury was caused by some other factor, including export performance. The Tribunal discharged its duty under SIMA subsection 42(1) and SIM Regulations subsection 37.1(3). It committed no error.

The Panel finds that the Tribunal majority properly examined Camco’s export performance and that its conclusions associated therewith are sufficiently grounded in law and fact such that the Panel, applying a deferential standard of review, upholds the Tribunal’s decision.



4) CUMULATION PURSUANT TO SIMA SUBSECTION 42(3)

Whirlpool claims that the Tribunal committed reviewable error in making a “cumulative” determination of material injury in respect of appliances exported to Canada by Whirlpool and WCI. According to Whirlpool, “cumulation”, as prescribed under SIMA subsection 42(3) and Article 3.3 of the WTO Anti-Dumping Agreement, is only permitted where the Tribunal is conducting simultaneous investigations of goods from two or more countries. It follows that where, as here, the Tribunal is investigating exports from a single country, it cannot “cumulate” exports by two or more producers in assessing material injury. Furthermore, Whirlpool claims that because this is a “producer specific” or “targeted” investigation - involving fewer than all exports from a country - it is particularly inappropriate to consider “cumulatively” the goods exported by two or more subject producers.

In effect, Whirlpool asserts that the Tribunal was required to make separate findings respecting material injury with respect to each foreign producer subject to the investigation. At the same time, Whirlpool readily admits that it has been able to “find no case . . . where in a producer-
specific situation there has been discussion of cumulation”⁴⁹ and cannot point to any authority for its position.⁵⁰

The Panel finds no basis in law for Whirlpool’s contention. The concept of “cumulation”, as used in subsection 42(3) of SIMA and Article 3.3 of the WTO Anti-Dumping Agreement, is only relevant in cases where the Tribunal is conducting simultaneous investigations of dumped goods from more than one country. Thus, SIMA subsection 42(3) provides:

(3) In making or resuming its inquiry under subsection (1), the Tribunal shall make an assessment of the cumulative effect of the dumping or subsidizing of goods to which the preliminary determination applies that are imported into Canada from more than one country, if the Tribunal is satisfied that

(a) the margin of dumping or the amount of subsidy in relation to the goods from each of those countries is not insignificant and the volume of the goods from each of those countries is not negligible; and

(b) An assessment of the cumulative effect would be appropriate taking into account the conditions of competition between goods to which the preliminary determination applies that are imported into Canada from any of those countries and

(i) goods to which the preliminary determination applies that are imported into Canada from any other of those countries, or
(ii) like goods of domestic producers.[Emphasis added]

Unquestionably, the decision concerning whether or not the Tribunal should engage in “cumulation” is only relevant where goods from two or more countries are involved. Moreover, the comparisons called for in SIMA can only be conducted when goods from more than one country are under investigation.

Similarly, the WTO Anti-Dumping Agreement only speaks of “cumulation” in terms of assessing the impact of imports for more than one country. Article 3.3 of the Agreement provides that:

Where imports of a product from more than one country are simultaneously subject to anti-dumping investigations, the investigating authorities may cumulatively assess the effects of such imports only if they determine that (a) the margin of dumping established in relation to the imports from each country is more than de minimis as defined in paragraph 8 of Article 5 and the volume of imports from each country is not negligible, and (b) a cumulative assessment of the effects of the imports is appropriate in light of the conditions of competition between the imported products and the conditions of competition between the imported products and the like domestic product.[Emphasis added]

Like SIMA subsection 42(3), the WTO Anti-Dumping Agreement speaks of investigations involving products “from more than one country”, when those goods are “simultaneously subject to antidumping investigations”.

Further, both SIMA and the WTO Anti-Dumping Agreement specify the threshold tests, which must be applied before determining whether cumulation is appropriate. These tests require an examination of margins of dumping for goods from each country as well as the volume of imports from each country. These tests are, by their terms, inapplicable in an antidumping investigation involving goods from a single country. Indeed, prior Panels⁵¹ have recognized that “The so-called principle of cumulation refers to a common practice of many of the signatories to the Anti-dumping Code whereby dumped imports from all subject countries are considered cumulatively for the purpose of establishing their impact on domestic production.”⁵²

Nothing in the WTO Anti-Dumping Agreement or SIMA suggests that the Tribunal should not aggregate all imports from a given country, for injury analysis purposes. Indeed, Article 3 of the WTO Anti-Dumping Agreement requires an examination of the volume “of dumped imports”, the effect “of dumped imports” on prices for domestic like products and the consequent impact “of these imports” on domestic producers.⁵³ The WTO Anti-Dumping Agreement requires an evaluation, inter alia, of the increase or decrease in the volume of “dumped imports”, and the impact of “dumped imports” on the domestic industry concerned. Similarly, SIM Regulations subsection 37(1) requires the Tribunal to consider the volume and impact of “dumped or subsidized goods”. Nothing whatsoever suggests that the Tribunal is required to make separate determinations with respect to “dumped imports” on a producer-specific or exporter specific basis and, as Whirlpool readily admits, it has not been the practice of the Tribunal to make such separate determinations.

Finally, Whirlpool’s argument suffers from an internal inconsistency. Whirlpool admits that in a single-country investigation, the Tribunal may properly consider the aggregate impact of all the imports from the country concerned,⁵⁴ but suggests that a different analysis must be employed in a “producer specific” or “targeted” case.⁵⁵ Yet Whirlpool offers no logical reason for the

distinction, and admits it is not grounded in precedent. Rather, Whirlpool merely seeks a remand of this case to the Tribunal, so that the Tribunal can explain its supposed decision to “cumulate” the impact of Whirlpool and WCI exports.⁵⁶ However, it is abundantly clear that the Tribunal did not, and could not, perform a cumulation in this case as prescribed by SIMA subsection 42(3). The Tribunal did nothing more than consider the impact of the “dumped imports” from a single country on the domestic industry, as SIMA instructs the CITT to do.

In conclusion both SIMA and the WTO Anti-Dumping Agreement limit “cumulation” to cases involving two or more countries. Whatever term is used to describe the Tribunal’s practice of considering the aggregate impact on domestic industry of all dumped imports from a single country, “cumulation” is not appropriately used in this particular context.



5) EXCLUSIONS

Complainants Whirlpool and Inglis requested exclusions with respect to six product categories.⁵⁷ WCI argued for two others, one of which (large refrigerators) essentially overlaps one of Whirlpool’s requests.

The Tribunal granted exclusion to three products, which are at issue, namely large refrigerators, stainless steel tub dishwashers, and stackable dryers. Complainant Camco asserts that the Tribunal erred in granting the three exclusions.

In addition, Whirlpool contends that the Tribunal committed an error in failing to furnish reasons for the denial of its claims for exclusion for Kitchen Aid brand products, dryers sold to the builder trade, private label dryers, and certain specialty dryers.

It is necessary for the Panel to determine the standard of review with respect to these exclusions under the “pragmatic and functional” test examined in the first section of this opinion. It is evident that the determinations regarding these exclusions are largely findings of fact, and as noted in the opening section, taking all the other factors into account under the pragmatic and functional test the standard naturally devolves along the continuum to patent unreasonableness where the issue is a matter of evidence. There can be no question that the responsibility for findings under SIMA subsection 43(1) has been devolved by the Parliament to the CITT. The statute charges that the CITT:

… shall make such order or finding with respect to the goods to which the final determination applies as the nature of the matter may require, and shall declare to what goods, including, where applicable, from what supplier and from what country of export, the order or finding applies.

In no manner is the mandate circumscribed so as to fetter the discretion of the CITT in making proper factual findings to carry out this responsibility. Thus, in a matter so fact-specific as this, it must be clear that the CITT has wide discretion to analyze the facts developed in order to determine to which goods the injury finding applies.⁵⁸ Indeed, the Tribunal is far better able than the courts or a reviewing binational panel as in this case to make these determinations, due to its intimacy with the factual record and experience in making decisions in this area.

i. Exclusions granted by the Tribunal

The complainant Camco argues that the Tribunal committed a reviewable error in excluding certain products from the injury determination, namely refrigerators with a capacity of 18.5⁵⁹ cubic feet and above, dishwashers with stainless steel tubs, and dryers with controls at the front, removable tops and chassis designed to be stacked on top of washers.

Camco has asserted that the exclusion of a product is to be made only in “exceptional circumstances” or on “rare occasions”, and cites a number of cases to support the proposition⁶⁰. However, a review of these cases does not support the idea that the Tribunal has set a particularly high threshold for the consideration of product exclusions. Indeed, in Corrosion-Resistant Steel Sheet, notwithstanding the recitation of the proposition that product “…exclusions will only be granted in exceptional circumstances”,⁶¹ the Tribunal proceeded to analyze each request and to exclude a number of specific products from its injury determination on the ground that like goods were not produced in Canada, or dumped goods did not compete with goods produced in Canada.

With respect to producer and country exclusions, however, the Tribunal recognized that the exclusion principle ran into conflict with the principle of cumulation, and therefore declined to grant those exemptions from its injury determination. In sum, it is obvious that the Tribunal was of the opinion that the fact that a product was not produced in Canada, or that it did not compete with goods produced in Canada, was a sufficiently “exceptional circumstance” to warrant a product exclusion. The Panel accordingly, is of the view that it is more proper to apply the “exceptional circumstances” rule to claimed exporter or country exclusions.⁶²

Likewise, in Flat Hot-Rolled the CITT rejected a request for country exclusions. Nevertheless it considered each request for product exclusion based, essentially on whether the imports competed with domestically produced goods. In this Inquiry, the Tribunal’s analysis led it to the conclusion that the subject goods did, in fact, compete with domestic hot-rolled steel sheet, and accordingly declined to exempt the claimed merchandise from its injury determination.

In Refined Sugar the Tribunal rejected certain product exclusion claims, not citing any general principle of “ exceptional circumstances”, but solely upon the factual finding that the imports were, “...goods which the domestic industry currently produces and which are readily substitutable for, and compete directly with, domestically produced goods.”⁶³ Finally, Camco also cites Cold-Rolled Sheet Steel,⁶⁴ for the proposition that the granting of exclusion is an anomaly. However, an examination of that Panel’s decision reveals that the Panel was dealing essentially with producer exclusions, and the law concerning cumulation.

It is therefore the opinion of the Panel that the law demonstrates no bias for or against the granting of product exclusions, but rather envisions a case-by-case consideration of the factors militating in favor of, or against, exclusion.

What then are the factors, which the Tribunal should consider in the granting of product exclusions? Although the rules are variously formulated, it is apparent that the principal consideration is whether the domestic industry produces the product, or, alternatively, a product with which the imports compete. As a corollary proposition, the Tribunal considers “…whether the domestic industry is an ‘active supplier’ of the product and whether the requested exclusion was to fill a market niche or was unique.”⁶⁵

The Tribunal excluded top-mount refrigerators with a capacity greater than 18.5 cubic feet and above on the grounds that these refrigerators are not produced in Canada, are sold in a different segment of the market, and that, thus, they do not compete with refrigerators made by Camco. It was further noted that Camco, itself, imports refrigerators of this size. Camco counters by arguing that this result was incorrect because it lost market share of refrigerators, in general, and that large size refrigerators were capturing an increasing share of the market for refrigerators. The Panel is of the view that these factors are not relevant in view of the lack of domestically produced appliances of the same size.

More to the point is the contention that in some cases Whirlpool and WCI’s large size refrigerators were priced at or below smaller domestic models, and that therefore they competed with smaller models. Furthermore, in some cases the standard size cavity for refrigerators in Canadian homes will accommodate large size ones. However, there was also evidence, to the contrary. The Tribunal found that large size refrigerators were not sold in the same segment of the market as smaller models, and therefore did not compete with them. There was also testimony that consumers did not regard the two as the same product. In addition, since Camco itself imported large size refrigerators, the Tribunal discounted the idea that the two were substitutable. The Panel is therefore of the view that there was, at best, conflicting evidence that large size refrigerators could be substituted for smaller ones. Under the patent unreasonableness standard to be applied here, it will not substitute its evaluation of the evidence for the Tribunal’s.

Camco sold tub dishwashers with plastic interiors. Both Whirlpool and WCI produced stainless steel tub washers, which were excluded by the CITT from the injury determination. Camco argues that the exclusion was improper because the dumping margins were substantial, Camco lost considerable market share in dishwashers as WCI and Whirlpool’s imports increased substantially, and the imports were priced in some cases at, or below Camco’s. Further, Camco cites evidence that the two are physically interchangeable, and that they are sold in the same segment of the market.

The Tribunal recognized that there is, “…a degree of interchangeability”⁶⁶ between the two, but concluded:

…there are major differences between plastic and stainless steel tub dishwashers with respect to their price, appearance and performance characteristics. The evidence also shows that stainless steel tub dishwashers are clearly sold in a different segment of the market, fill a particular market niche, are unique, are not produced in Canada and do not compete directly with the domestically produced like goods.⁶⁷

The Panel recognizes the appeal of the argument that the dishwashers are competitive with each other in the broadest sense, as both will get dishes equally clean. But that is not enough. There is considerable evidence in the record to support the determination that stainless tubs are not perceived by the customer as the same product as plastic ones, and that the two don’t compete directly in the marketplace. Given that the stainless tub product is not produced in Canada, and is unique, the Panel is not persuaded that the economic factors cited by Camco make the products interchangeable. In sum, the Panel is of the view that there is evidence in the record to support the CITT finding on tub dishwashers.

Likewise, the Panel will not disturb the Tribunal’s finding on front control stackable dryers. These dryers are designed to be used in conjunction with matching washers, and Camco did not produce a similar product. Its argument against granting the exclusion is therefore solely based upon the economic factors that it lost market share, for its own dryers, and that there was a significant dumping margin found. It would seem evident that the Tribunal found sufficient evidence to counter Camco’s contention that the imported dryers are interchangeable or substitutable for domestically produced dryers.


ii. Exclusions denied

The complainant Whirlpool, in addition to its request for exclusion of stainless steel dishwashers and large size refrigerators, both of which were granted, made a request in regard to all Kitchen Aid brand appliances, to dryers sold to private label brand distributors and to builders, and, lastly, with respect to specialty dryers (compact, “smart card” and coin-operated machines). The gist of the Kitchen Aid brand argument is that Kitchen Aid is a premium brand, which competes only with a premium General Electric line, which is imported by Camco. As to private label and builders’ dryers, they are always sold in pairs or “bundled” with washers (which are not made by Camco), with the washer choice driving the sale. For the category of specialty dryers, it is also asserted that they are not produced in Canada by Camco, and that they therefore do not compete with goods made by Camco. Whirlpool assets that it submitted substantial evidence on these points before the Tribunal.

The Tribunal, however, dismissed these claims as follows:

As noted earlier, the Tribunal has considered, in its injury analysis, the overall effects of the dumped imports on the domestic industry. Having conducted such an assessment and considered Whirlpool’s participation in the Canadian market and, in particular, its volume of sales of dumped product in Canada, the Tribunal is of the view that there are no valid reasons to generally exclude Whirlpool from its findings.⁶⁸

It is Whirlpool’s position that the Tribunal committed an error of law by not furnishing reasons for the denial of its claim. Reliance is placed principally upon Via Rail Canada Inc. v. National Transportation Agency.⁶⁹ Whirlpool points to this decision as standing for the proposition that an administrative agency is required to give reasons for its decisions and is particularly obligated to do so where it is performing a function where the agency is to be granted a high degree of deference. The complainant notes that the Tribunal specifically recognized Whirlpool’s requests in its Statement of Reasons and that, notwithstanding, there was no indication of the details of the basis for rejecting them.

It certainly would have been appropriate for the Tribunal to deal with the specifics of Whirlpools’ claims. The Tribunal now asserts that since the denial of exclusion is tantamount to finding that there is injury with respect to that product, it is not obligated to furnish the reasons for the denial. Further, the CITT argues that it is not obligated to address every issue raised by the parties, and that it is reasonable to infer that the Tribunal did not feel that the exclusions were warranted. Interestingly, Camco, in challenging the exclusions, which were made, argues that while it is necessary to furnish the reasons for granting an exclusion, there is no obligation on the part of the CITT to explain a denial.

The Panel believes that it is a reasonable inference that the Tribunal considered all of the requests for exemption. After all, the Tribunal did exclude certain refrigerators, washer, and dryers imported by Whirlpool and WCI. The Panel could dispose of this matter easily by finding that the Statement of Reasons did, in fact, indicate the reason for the denial of the claim, i.e., the substantial volume of dumped goods sold by Whirlpool. However, it is difficult to read the Statement of Reasons as adequately addressing the specific products in issue. The statement that Whirlpool was only requesting a “general” exclusion insufficiently characterizes its claims. Therefore the question must be answered as to whether the Tribunal is obligated to state the reasons for every decision subsumed in its conclusion.

At issue in Via Rail Canada was a provision in the carrier’s fare schedule which authorized a free ticket for attendants to disabled persons who were capable of providing assistance to the disabled in boarding and deboarding the train. The issue arose as to whether it would be sufficient for attendants to merely assist the disabled in other ways. The National Transportation Agency found that as it was the Railroad’s responsibility to aid in boarding, the tariff was invalid as too narrow. The Agency was acting under a statute⁷⁰ authorizing it to approve fares, which required that fares do not constitute, “an undue obstacle to the mobility of persons, including those persons who are disabled.”⁷¹

The Court concluded that the Agency’s failure to state the reasons why the fare represented an “undue obstacle” rendered invalid the Agency’s decision to reject the tariff. Since the Agency was required to balance the interests of the disabled and the carrier in reviewing the tariff, the Court held that it should have given the reasons for its decision. The Panel finds interesting that among the virtues of providing reasons, as found by the Court, is the idea that reasons would help to guide the conduct of other carriers in the future. That, in the Panel’s view, points to the distinguishing feature of the Agency’s action from that of the CITT in this case. In Via Rail Canada the Agency in construing this standard was performing a quasi-judicial function, and not just fact-finding. Indeed, that is arguably the reason for the application of the standard of “reasonableness” in that case, rather than “patent unreasonableness”, as in this case. Accordingly, we do not find Via Rail Canada to be controlling in this matter.

At the same time the Panel is very reluctant to seemingly adopt the view expressed by the Tribunal’s Counsel that the Tribunal is never required to set forth the reasons for the rejection of an exclusion request. However, there is an inference, where there is injury, that all dumped goods contributed to the injury, and bearing in mind that the Tribunal obviously did grant some of the complainant’s requests, and that the CITT is entitled to wide discretion in its fact specific determinations, the Panel will decline to remand the Tribunal’s decision and require further explanation.