The Study On The Transformation Of Zeroing's Legal Status In The Multilateral Trading System

In recent years, Zeroing methodology is a controversial issue in anti-dumping proceedings and has been challenged in WTO Dispute Settlement Body (DSB) for several times. The Appellate Body(AB) of WTO creatively used a teleological interpretation as a new method of international legal interpretation instead of a mere textual interpretation to clarify the textual ambiguity of the Antidumping Agreement as to Zeroing. The AB's adjudications which have made Zeroing illegal from the former legal status rest on the WTO 's telos, i.e., free trade and global market integration, so it is called "constitutional adjudication" by the scholars who have observed the recent proliferation of antidumping measures as a new protectionist instrument. This change in AB's attitudes toward Zeroing in the multilateral trading system has had a far-reaching influence, reflecting the requirements of the development of economic globalization and the delicate changes of the WTO member states' power in the international community."Zeroing" refers to an asymmetrical calculative methodology used by one nation's anti-dumping investigation authority especially by US department of commerce in obtaining final dumping margins. USDOC omits any negative results occurring when export prices exceed normal values (such as home prices) and instead includes only positive results occurring when home prices exceed export prices.The use of Zeroing will almost always increase the level of any antidumping duty, and will sometimes create a duty where none would have been imposed, had the methodology not been used. According to one study, Zeroing tends to inflate dumping margins nearly by 90%. Therefore the AB has viewed that this unfair result from Zeroing makes pro-Zeroing interpretation of the Antidumping Agreement as "impermissible" even under Article 17.6 (ii) of the Antidumping Agreement.Zeroing is now regarded as one of the most unfair methodologies in the international trading system. It is a long history for Zeroing to be condemned in the international community. In the era of the GATT jurisprudence, Zeroing was upheld because of the lack of detailed provisions as to the ways of comparison between the normal values and export prices. So in the case of EC - Audio Cassettes (Japan), the panel attempted to legitimize the Zeroing methodology by adopting the narrow textualist reading of Articles 2 and 8 of the Tokyo Round Antidumping Code. In the Uruguay Round negotiations, party members still couldn't reach a consensus as to Zeroing. In the era of WTO jurisprudence, after the first denial on Zeroing in EC - Bed Linen (India), only the U.S. still has not recognized the negative dumping margins in calculating dumping margins stubbornly. The U.S. practice of Zeroing has recently been challenged at least six times before the World Trade Organization (WTO), and has generally been found to be inconsistent with the WTO obligations of the United States.The dissertation systematically introduces the adjudication of the cases involving "Zeroing" done by the panel especially the Appellate Body in WTO DSM, and narrates the process of Zeroing's legal status from legal to illegal. The writer analyzes its constitutional implications embeddened deeply in the AB's adjudication in order to arouse more academic reflection and promote the improvements of the legislation and practices of anti-dumping measures in China.In the first part, a general review of the zeroing disputes in the mulitiple trading system and the internal relationship between zeroing, dumping, anti-dumping will be introduced. The methods of calculating dumping margins are the focus of this chapter.Part II introduces the application of zeroing and the evolution of anti-dumping dispute settlement mechanism. There are three types of zeroing in the calculation of dumping margins to decide whether some merchandise is dumped. This part also talks about the evolution of anti-dumping law, with a more comprehensive dispute settlement mechanism.Part III and part IV discusses the transformatiom of Zeroing's legal status from legal to illegal to illustrate how the Appellate Body gradually clarifies the ambiguity of the provisions of Anti-Dumping Agreement. In Part V, the writer analyzes the constitutional values embeddeded in AB's rullings ahd shows her viewpoints.