ARTICLE 1904
BINATIONAL PANEL REVIEW
UNDER
NORTH AMERICAN FREE TRADE AGREEMENT

46. Where, during an inquiry referred to in section 42 respecting the dumping or subsidizing of goods to which a preliminary determination under this Act applies, the Tribunal is of the opinion that

(a) there is evidence that goods the uses and other characteristics of which closely resemble the uses and other characteristics of goods to which the preliminary determination applies have been or are being dumped or subsidized, and

(b) the evidence discloses a reasonable indication that the dumping or subsidizing referred to in paragraph (a) has caused injury or retardation or is threatening to cause injury,

the Tribunal, by notice in writing setting out the description of the goods first mentioned in paragraph (a), shall so advise the Commissioner.

The Tribunal denied Whirlpool’s request, saying:

In addition to its earlier comments to the effect that Maytag and other unnamed U.S. exporters' goods not being injurious to the domestic industry, the Tribunal is not persuaded, with respect to Maytag, that the evidence indicates that Maytag's refrigerators, dishwashers and dryers are being dumped in the Canadian market. The Tribunal notes and agrees with Camco that there is no evidence that Maytag's marketing and pricing practices have been injurious to the domestic industry. As for the goods from the unnamed exporters, the Tribunal is of the opinion that the evidence before it is insufficient to support a conclusion that the goods produced by these exporters have been or are presently being dumped in Canada and that their presence has been injurious to the domestic market. The Tribunal, therefore, declines to advise the Commissioner to investigate these exporters.⁷²

Whirlpool complains that this ruling of the Tribunal constituted a reviewable error. Maytag and the Tribunal defend the Tribunal’s decision. Camco and WCI take no position on the issue, but WCI points out that any injury caused by a third party must be excluded in determining whether relief against the original respondents is warranted.

The following section reviews the standard of review and then the three elements of inquiry under section 46: dumping, injury, and threat of injury. Prior to 1994, the task of the Tribunal under section 46 was to make findings on the above issues, which, if affirmative, obligated the Commissioner to initiate an investigation of the alleged third party dumping. A 1994 amendment resulted in the revised text of section 46 set forth above, pursuant to which the Tribunal only conveys to the Commissioner its “opinion” that the conditions for an investigation exist, leaving to the Commissioner the final decision as to whether to initiate. While the earlier statute automatically triggered an investigation by the Commissioner, pursuant to SIMA today, it requires the concurrence of both agencies.

Whirlpool here argues in essence that under the current Statute any evidence of dumping is sufficient to satisfy section 46(a):

The Tribunal may only determine that the requirements of subsection 46(a) of SIMA have not been met where it is of the opinion that there is no evidence that the excluded goods have been or are being dumped.⁷³

On this reading of SIMA, the task of the Tribunal under section 46(a) is ministerial, it has no discretion, and the ‘correctness’ standard of review would apply. This Panel reads section 46(a) otherwise. The text calls for an “opinion” of the Tribunal that there is evidence of dumping. Whirlpool would in effect read this language out of the statute. The Tribunal’s "opinion" under section 46(a) necessarily involves an element of judgment and discretion. This would be an issue of mixed fact and law, and an examination of all of the factors in the pragmatic and functional test would indicate that a reasonableness simpliciter standard of review would apply.

In the present case the matter is especially clear. A dumping investigation of Maytag and other third party exporters was requested when the proceeding was before the Commissioner. It was rejected. The earlier ruling should be regarded as the law of the case, and a remand on this issue would appear to the Panel to be an exercise in futility.

Under section 46(b) the language is clear, calling for a finding that “the evidence discloses a reasonable indication” of causation of injury (or retardation). Plainly a determination of what is reasonable involves an element of judgment and discretion and thus once again and in light of the functional and pragmatic test attracts a reasonableness standard of review before this Panel.

Finally, in examining the last statutory element - ‘threat of injury’, it is by its very nature an inference as to future events and thus largely a matter of judgment. Again the standard of review would be reasonableness simpliciter.


i. Alleged Maytag and Third Party Dumping

Whirlpool introduced in evidence before the Tribunal two Maytag dealer price lists showing higher list prices to dealers in the United States than to dealers in Canada for the same models. On cross-examination before the Tribunal, Whirlpool’s witnesses conceded that they did not know what prices were actually charged for these Maytag products in either country. Whirlpool argued that its evidence was “the most that could possibly be expected of a party in [this] situation”⁷⁴, citing Stainless Steel Round Bars⁷⁵, where the Tribunal accepted indirect evidence of dumping by a Korean exporter. The surrounding facts, however, were different in that case: the complaining party does not appear to have been active in the Korean market, and so could not be expected to know the prices in that market, whereas Whirlpool was active in both markets involved in this matter. Whirlpool also points to evidence that some Maytag prices in Canada were below those of Whirlpool and WCI for comparable appliances, but this is hardly evidence of dumping by Maytag. In the end, however, since a SIMA section 46 notice is sent by the Tribunal to the Commissioner only if both the dumping standard of section 46(a) and the injury standard of section 46(b) are met, Whirlpool’s failure to clear the first hurdle is dispositive.


ii. Injury

Whirlpool also asserts that “it was at the suggestion of the Commissioner (following its refusal to properly expand the scope of its investigation) that the complainants brought the section 46 issue before the Tribunal.”⁷⁶ On the contrary, what the Commissioner said was:

The CCRA analyzed the evidence provided in support of the allegations and is satisfied that the scope of the investigation was appropriate. Ultimately, evidence of injury must be presented to the Tribunal to support why the injury has been caused by the named companies and not by other companies in the named country.⁷⁷

In other words, it was open to Whirlpool to show in the present proceeding what if any injury to Camco the non-party imports were causing, so that Whirlpool would not be held responsible for such injury. WCI argued that this was the proper context for a showing by Whirlpool that Maytag had caused injury. But Whirlpool does not argue here that it was held responsible for injury caused by Maytag or other non-parties.


iii. Threat of Injury

The Tribunal made no express finding as to a threat of injury. But Whirlpool does not claim to have presented evidence as to any anticipated developments that would give rise to new dumping or injury. There being insufficient showing of past or present dumping by the non-parties, and no claim of such prospects, it is clearly implicit that the Tribunal did not deem there to be a threat that would warrant notice to the Commissioner. While it would have been better practice for the Tribunal to make an express finding on the point, in the circumstances a remand is not warranted.


CONCLUSION

In view of the foregoing, the Panel hereby orders that the decision of the Tribunal in this matter be and is hereby affirmed. The Panel directs the Canadian Secretary of the NAFTA Secretariat to issue a Notice of Final Panel Action pursuant to Rule 77 of the NAFTA Rules of Procedure for Article 1904.


Signed in the Original by: