Learning by Doing: The Impact of a Trade Remedy Case
in Korea
Junsok Yang*
I. The problem in context
This study deals with a particular case submitted to the WTO Dispute Settlement Mechanism
(DSM) dealing with restrictions on the export of Korean(1) colour televisions sets to the
United States. It is a story of how Korea used the WTO DSM as part of an overall strategy to
eliminate a trade barrier that had been in place for fifteen years. It is also a story of how
Korea’s attitude towards the WTO changed. Thus, before we start dealing with this particular
case, we need to look at some background, at what Koreans think about trade and their
initial perception of the WTO.
Korean development and its attitude to trade
Like many other countries, Koreans tend to have a mercantilist view of trade, where exports
are good and imports are bad. Such views are quite surprising, since the value of exports and
imports in Korea usually exceed 70% of GDP, and Koreans themselves will readily admit that
the country has no choice but to import raw materials, intermediate goods, capital goods and
technology from abroad in order to compete in the global marketplace, as well as to fulfil
domestic consumer demand. However, the average Korean often believes that Koreans must
do everything they can to increase exports, while limiting imports only to ‘necessary’ goods.
This mercantilist mindset was born in the 1960s, when Korea’s average annual GDP per capita
was around $150.
During the first sixty years of the twentieth century, Korea suffered thirty-six years of
Japanese colonial rule. Then, at the end of the Second World War, the country was split into
North and South Korea, shortly followed by the three years of the Korean War. By the end of
this war, much of Korea’s industrial capacity was in ruins, and the country faced political
chaos.
Then, in the late 1960s, Korea began an outward-oriented growth path, using exports as an
engine for development. Korea joined GATT in 1967, around the time when it had embarked
on the outward-oriented development strategy. While practically every Korean realizes how
important exports have been, and still are, to the Korean economy, the fact that imports also
played a crucial part is sometimes neglected. Korea extensively liberalized the import of raw
materials and intermediate goods so that Korean manufactured goods could compete
effectively in the global market.
However, Korea maintained strict controls on imports of consumer goods, in part due to the
limited amount of hard currency at the time. Priority for the use of the hard currency was
given to exporting firms for the import of raw materials, intermediate goods and capital
goods. The government also encouraged private savings in order to provide investment funds
to the up-and-coming Korean industrial sector. The attitudes built up during these years,
namely a negative view toward conspicuous consumption and imports, has cast a long
shadow, apparent even now, when Korea has eliminated almost all of those import barriers
and achieved a GDP per capita of $10,000.
Given the mercantilist mindset and the fact that Korea is so dependent on trade for its
economic well-being, Koreans often think of their country as a helpless player in the harsh
global marketplace, where other countries limit imports of Korean goods for nationalist
reasons and have forced Korea to open its markets before the economy is ready, resulting in
massive domestic shocks. Considering that it was the gains from trade that allowed Korea to
develop, this mindset may be paradoxical, but Korea is hardly alone in having such views
about trade; it was, after all, only forty years ago that Korea’s GDP per capita was less than
$200.
Korean perception of trade disputes
In the early 1980s Korea’s GDP per capita was around US$1, 600-$2,000, and Korea was on its
way to becoming an economic dynamo, but it was still on a weak footing. At that time,
Korean companies were beginning to break into the global consumer electronics market.
Electronics manufacturers, such as Samsung and Goldstar (now LG), successfully penetrated
the US and European markets. However, during the same period the United States, which was
Korea’s largest export market, was experiencing record trade deficits, and the US press,
when reporting them, often emphasized the growing economic strength of Japan and its
neighbour Korea. Thus there had been strong popular feeling in the United States that the US
government should limit the market access of goods from Japan and Korea, and that
Japanese and Korean markets should be opened to US goods.
Such sentiments tended to strengthen the various US market restriction measures vis-à-vis
Korea’s exports. Especially bothersome to many Koreans were the anti-dumping measures
which the United States used to limit some of Korea’s most popular export items, such as
consumer electronics and steel. The US anti-dumping measure on colour televisions, which is
the subject of this article, was also imposed around this time.
Koreans felt that their success in the international marketplace was due to low costs and
price competitiveness rather than to ‘unfair’ trading practices as the United States claimed.
Some Koreans felt that the international trading environment was unfair, since Korea was
rapidly opening up its markets, due in some cases to US pressure, while the United States was
seemingly closing its own.
Partly due to the weakness of GATT and the dispute settlement mechanism at the time, these
trade disputes resulted in confrontations with heavy political pressure, resulting in ill-will on
all sides. People in Korea and the United States often thought of trade as an economic war,
rather than a ‘win-win’ situation for all.
The Korean perception of the WTO
In some ways the Uruguay Round (UR) and the WTO were designed to reduce such
confrontations on trade disputes. When the UR negotiations were complete and the WTO was
formed, there was an expectation by Koreans that trade disputes would be solved not by
political confrontation, where Korea was bound to lose to other large countries, but through a
third party that would maintain neutrality and keep the global trading environment fair.
In its attempt to ensure that the WTO was such a third party, Korea paid a heavy political
price domestically. Agriculture has always had a special place in Korea, and the political
institutions and even consumers would support protection for agricultural goods in order to
protect the farmers, even though they knew that it would result in higher prices for food.
Many of these protective devices for agriculture were dismantled as the result of the Uruguay
Round. Other sensitive sectors, such as services, were liberalized as well. Political
repercussions from the liberalization are still being felt today.
However, Koreans were soon disappointed in the WTO. During the first few years of its
operation, the United States and the European Union brought several cases against Korea.
Between 1995 and 1997, eight cases against Korea were brought to the Dispute Settlement
Body (DSB), and Korea usually had to accept major changes in its import regime. While these
cases were lost on their merits, and even though many Koreans acknowledged that many of
Korea’s trade barriers were unfair, they still felt that Korea was under siege from foreign
countries, and that the WTO existed for the benefit of advanced economies seeking to open
the markets of developing countries. Table 1 shows the cases brought against Korea in the
WTO DSM.
Table 1
Cases broutht against Korea
Date
Case
no.
Complainant
Subject
1995.4.6
DS3
United States
Measures Concerning the Testing and Inspection of
Agricultural Products
1995.5.3
DS5
United States
Measures Concerning the Shelf-Life of Products
1995.11.8
DS20
Canada
Measures Concerning Bottled Water
1996.5.9
DS40
EC
Laws, Regulations and Practices in the
Telecommunications Sector
1996.5.24
DS41
United States
Measures Concerning Inspection of Agricultural
Products
1997.4.4
DS75
DS84
EC, United
States
Taxes on Alcoholic Beverages
1997.8.12
DS98
EC
Definitive Safeguard Measures on Imports of Certain
Dairy Products
1999.2.1
DS161
Australia,
Measures Affecting Imports of Fresh,
DS169
United States
Chilled or Frozen Beef
DS163
United States
Measures Affecting Government Procurement
EC
Measures Affecting Trade in Commercial Vessels
1999.2.16
2002.10.21 D273
Source: WTO, ‘Update of WTO Dispute Settlement Cases’, 26 March 2004.
In early 1997 the European Communities (EC) and the United States filed a case against Korea
which proved to be especially sensitive. In that case, known as ‘Taxes on Alcoholic
Beverages’, the EC and the United States argued that imported spirits, such as whisky, should
be charged the same domestic alcoholic beverage tax rates as soju, a popular Korean
traditional alcoholic beverage. Koreans see whisky as an expensive luxury item. In contrast,
while the alcohol content of soju may be closer to spirits, Koreans see soju as a simple, cheap
and popular beverage, closer in character culturally to beer than to whisky. While the EC and
the United States may have been correct in scientific terms, soju was certainly not thought of
as being ‘similar’ to whisky by most Koreans, and the case caused heated arguments among
Koreans. It did much to reinforce the popular conception that the WTO was a tool of the
advanced countries in opening the markets of poorer, smaller countries.
II. The local and external players and their roles
In 1997, against this background, Korea brought its first case to the WTO DSB. The case
concerned anti-dumping duties on Korean-manufactured colour television receivers. Korea
had previously participated in the DSM as a third party, but this case was the first where
Korea was the complainant.
There were three major players in this case: Samsung Electronics, producer of various
electronic goods including colour televisions and one of the firms facing the anti-dumping
measure; the Korean government, which brought the case to the WTO on behalf of Samsung;
and the US government, specifically the Department of Commerce, which had the
responsibility of reviewing the anti-dumping measure. Other players included US labour
unions, which had filed an anti-circumvention suit against Samsung, and the governments of
Mexico and Thailand, which became involved in the case due to the anti-circumvention suit.
The Korean public was also an important, though passive, observer in the case. The
background of the specific case is as follows.
In the late 1970s, Korea became a major exporter of colour television receivers due to price
competitiveness. Korean exports of colour televisions to the United States had been
restrained through a voluntary export restraint (VER) agreement between February 1979 and
June 1982, but following the repeal of the VER in 1982, the export volume and value rose
greatly. In 1983, the export volume to the United States was 1.93 million sets, 200% greater
than that of the previous year, while the value of exports to the United States rose over 170%
from the previous year, to $302.6 million.
In 1983 the United States initiated an anti-dumping action against six Korean colour television
producers, and on 30 April 1984 it imposed anti-dumping duties on colour televisions from
four of those producers, including Samsung. Investigation covered the period from April 1982
to March 1983, and while the preliminary decision showed that the dumping margins ranged
between 0 and 5.31%, the final decision showed the dumping margins to be between 0 and
15.95%.(2)
From April 1985 to March 1991, exports of Korean colour televisions to the United States fell
substantially and their price in the United States rose. In subsequent reviews, the United
States found that dumping margins for colour television receivers produced by Samsung were
below the de minimis margin of 0.5%. Further, Korean electronic manufacturers, including
Samsung, moved much of their production abroad to Mexico and Thailand to lower production
costs. Thus, from April 1991, Samsung did not export any colour television receivers from
Korea. It made periodic requests for the revocation of the anti-dumping order, but the United
States still maintained its anti-dumping measures on Samsung colour television receivers,
arguing that there was a potential for resumed dumping. In 1996 the United States expanded,
of its own accord, the anti-dumping measure to include combination television-video cassette
recorder (VCR) units and high definition (HD) televisions, which were typically considered
distinct from colour television receivers in terms of goods and tariff classifications.
By 1995 Samsung had made five applications for the revocation of the anti-dumping measure.
Four applications were rejected on procedural grounds concerning the timing of applications.
The fifth application, filed on 20 July 1995, was not acted on for eleven months. In August
1995 the United States had received a petition from several US labour unions, including the
International Brotherhood of Electrical Workers, the International Union of Electronic,
Electrical, Salaried, Machine and Furniture Workers, and the Industrial Union Department,
which accused Korean firms of using the production facilities in Mexico and Thailand to
disguise Korean exports and circumvent the anti-dumping measure.
In response, the United States had initiated an anti-circumvention investigation in January
1996. While the United States decided to initiate a review of the anti-dumping measure on 24
June 1996, a year elapsed without any definite results. The US government explained that the
review for revocation had to await the outcome of an anti-circumvention proceeding which
had begun in January 1996.
According to Han-Soo Kim, currently a senior official in the Korean Ministry of Foreign Affairs
and Trade (MOFAT), who had been involved in the colour television case, in the mid 1980s
Korea, along with Japan and Taiwan, had been the most frequent target of US anti-dumping
measures. Small and medium-sized firms often could not afford to fight the anti-dumping
decisions because of the costs involved, and were forced to stop exporting. Thus the Korean
government considered the anti-dumping measures to be serious trade barriers. When the
1984 anti-dumping measure was announced it generated much shock in Korea since colour
televisions were one of its strongest export items.
While Samsung managed an exclusion from paying anti-dumping duties, the anti-dumping
order remained, and Samsung had to undergo a review process every year. While Samsung,
and subsequently the Korean government, believed that Samsung was eligible for revocation
of the anti-dumping order, the US Department of Commerce maintained it. Frustrated with a
lack of result, a consensus emerged that this case was suitable for Korea’s first WTO DSM
case.
According to Kim, the modifications in the dispute settlement procedures made during the UR
negotiations played an important part in Korea’s bringing the colour television case to the
WTO DSB. Under the pre-WTO GATT, winning a case in the DSB required positive consensus
where all members had explicitly to accept the panel decision, and it would have been
difficult at that time for Korea to get a decision accepted by all GATT members. However,
the DSM under the WTO operated under a negative consensus, which requires that all GATT
members explicitly refuse the panel decision in order not to accept it. Thus the Korean
government felt that the United States could not block a favourable panel decision, and felt
confident enough to proceed with the DSM.
On Samsung’s side, while it had moved much of its production to Mexico, it felt that the
continuing use of the US anti-dumping measure was unfair, and it was also concerned with
potential future exports of HD televisions. It therefore encouraged the government to bring
the case, and worked closely with the government to prepare it.
III. Challenges faced and the outcome
Koreans faced several challenges in using the WTO DSM: Kim pointed to the lack of
experience, language problems and budgetary concerns due to the fact that Korea had to use
many foreign consultants. Because the Samsung case was the first brought to the WTO DSB by
Korea, there was no real knowledge as to how to proceed. Further, there was a general
dearth of Koreans with good English skills, the requisite legal skills and a good working
knowledge of the dispute. The Korean officials could only learn by experience and trial and
error. Recognizing these problems, Koreans hired foreign lawyers as consultants, but the high
cost was an issue for the ministry.
On the bright side, Samsung and the Korean government were able to work fairly smoothly
together, and co-operated to build a strong case for the WTO DSM. Samsung formed a trade
dispute team to gather the necessary information and to work with the Korean government.
This team is still in place today. The government and Samsung made meticulous preparations;
according to one newspaper account, the amount of paperwork prepared for the case could
have filled five 8-ton trucks.
The Korean case: the anti-dumping measure
Thus on 16 July 1997, the Korean government filed a request for consultations with the WTO
DSB, arguing that the US actions violated Articles VI.1 and VI.6(a) of GATT 1994, and Articles
1 and 11.1 of the Anti-Dumping Agreement, which stipulate that anti-dumping measures shall
be applied only if there is dumping and if it causes or threatens material injuries; and that
anti-dumping duties shall remain in force only as long as and to the extent necessary. Since
Samsung had not exported to the United States from Korea since 1991, and since it had been
assessed only on the de minimis margins for the previous six years, Korea argued that the
United States was in violation of these Articles.
Further, Korea argued that the United States violated Articles 2, 3.1, 3.2, 3.6, 4.1, 5.4, 5.8,
5.10 and 11.2 of the Anti-Dumping Agreement. Article 3.1 states that a determination of
injury shall involve an objective examination of the volume of the dumped imports and the
effect of the dumped imports on prices, and the consequent impact on domestic producers of
the like product. Article 3.2 states that with regard to the volume of the dumped imports,
the investigating authorities shall consider whether there has been a significant increase in
dumped imports. Korea argued that the absence of dumping for six years and the cessation of
exports for the subsequent six years fully demonstrate that, under the standards set out in
Articles 3.1 and 3.2, there can be no injury.
Article 5.8 of the Anti-Dumping Agreement requires immediate termination of an
investigation in the case of de minimis dumping margins, and Article 11.2 provides for
revocation of an anti-dumping order if it is no longer necessary to counteract dumping. Korea
argued that having found de minimis margins for Samsung for six consecutive years through
its annual reviews, the United States should immediately have initiated a revocation review
on its own initiative and terminated the anti-dumping order. Further, Korea argued that the
provision of the US Tariff Act, which defines a de minimis margin of less than 0.5% as eligible
for revocation, is in contravention of Article 5.8 of the Anti-Dumping Agreement which
stipulates a de minimis margin of less than 2%.
Article 11.2 of the Anti-Dumping Agreement specifies that the authorities shall review the
need for the continued imposition of anti-dumping duties on their own initiative, or upon
request by any interested party. Korea argued that by failing to self-initiate a revocation
review and by restricting Samsung’s right to request a review, the United States had evaded
its Article 11.2 obligations.
Korea also argued that the failure to reach a determination in the Commerce Department’s
revocation review also violates Article 11.4, which provides for the expeditious conclusion of
such reviews, normally within twelve months of their initiation.
The Korean case: the anti-circumvention investigation
Korea also took issue with the anti-circumvention investigation, stating that the anticircumvention investigation initiated on 19 January 1996 was in contravention of Article VI of
GATT 1994 and Article 1 of the Anti-Dumping Agreement.
Korea pointed out that Article VI.1 of GATT 1994 defines dumping as the introduction of
products of one country into the commerce of another country at less than normal value, and
Article 2.1 of the Anti-Dumping Agreement defines it as a situation in which the export price
of the product exported from one country to another is less than the comparable price for the
like product in the exporting country. Thus if another country becomes the exporting country,
dumping should be separately determined. Korea argued that by effectively considering
exports from Korea and exports from Mexico and Thailand as identical through its
circumvention concept, the United States misinterpreted the basic concept of dumping
established throughout the GATT and the Anti-Dumping Agreement. Further, Korea stated
that it was a violation of Article VI of GATT 1994 and Article 1 of the Anti-Dumping
Agreement to initiate an anti-circumvention investigation as an extension of existing antidumping measures without initiating a new dumping (and injury) investigation.
Korea also pointed out that the petitioners for the anti-circumvention investigation, namely
US labour unions such as the International Brotherhood of Electrical Workers and others, were
composed of employees working in various companies dealing in a diverse variety of electric
or electronic products. Therefore they could not be said to represent employees of the
domestic industry of the like product, namely, colour televisions. Further, Korea argued that
the US authorities had neglected to examine whether the petitioners indeed represented the
domestic industry, and refused Korean companies’ request for such an examination, thus
violating Articles 3.1, 3.6, 4.1 and 5.4 of the Anti-Dumping Agreement. Korea also stated that
the failure to make a determination in the ongoing investigation after eighteen months also
violated Article 5.10 of the Anti-Dumping Agreement.
Finally, Korea took issue with the fact that the United States linked the revocation review
with the anti-circumvention investigation. Korea stated that it was arbitrary and illogical for
the United States to respond quickly to the request for an anti-circumvention investigation
while delaying for a year its response to Samsung’s request for a revocation review. Korea
further stated that it was unreasonable for the United States to investigate the alleged
circumvention without first verifying the justification of the anti-dumping order. Further,
Korea argued that the attempt to link the results of the anti-circumvention investigation with
the revocation determination constituted a further breach of the proper procedural
sequence. That is, a decision by the US authorities to revoke the anti-dumping order against
Korean colour televisions would remove the legal basis for the anti-circumvention
investigation. Thus extending the review period by making the above-mentioned linkage
constituted a violation of Article 11.1 of the Anti-Dumping Agreement which requires the
immediate termination of the anti-dumping order in the absence of dumping which is causing
injury.
The Korean case: panel request
In July 1997 Mexico, Thailand, Hong Kong China, and the EC asked to join consultations.
During the consultation phase of the DSM, Korea and the United States held a series of
bilateral meetings which were not fruitful. On 6 November 1997 Korea requested the
establishment of a panel. In its request, in addition to the points made above, Korea also
argued that the United States was in violation of Article X.3 of GATT, and other assorted
Articles of the Anti-Dumping Agreement.
Korea argued that the initiation of the anti-circumvention proceeding violated Article VI of
GATT 1994 and Articles 1, 2.1 and 3.1 of the Agreement, because it might lead to the
imposition of anti-dumping duties on imports of colour televisions from Mexico and Thailand
without findings of dumping and resulting injury ever having been made.
Korea also argued that the refusal by the United States to conduct a standing inquiry before
initiating its anti-circumvention investigation violated Articles 3.1, 3.6, 4.1 and 5.4 of the
Anti-Dumping Agreement, and the failure to make a determination in the anti-circumvention
investigation for more than twenty-two months violated Article 5.10 of the Anti-Dumping
Agreement.
Finally, Korea argued that the United States violated Article X.3 of GATT and Article 17.6(i)
of the Anti-Dumping Agreement, because the United States had not established the facts
properly and had not evaluated the facts in an unbiased and objective manner. Korea stated
that Samsung had sufficient special reasons to justify its delays in requesting revocation
review, including, but not limited to, the United States’ consistent and excessive delays in
issuing results of the administrative reviews. The United States, however, unilaterally
determined that its untimeliness for the reviews was excusable, while Samsung’s untimeliness
was not. Korea also complained that while the initial investigation and review were
proceedings for the assessment of basically the same circumstances, the United States
applied different standards for determining de minimis dumping margins and negligible
imports in the two proceedings.(3)
IV. The outcome
Meanwhile, on the US side, on 31 December 1997, at the request of the petitioners, the US
anti-circumvention inquiry was terminated. Before termination, the US Department of
Commerce found that Samsung had substantial production facilities in Mexico, and several
feeder plants established and operated by Korean suppliers unrelated to Samsung. From these
facilities, Samsung produced colour televisions sold throughout North, Central and South
America, and these televisions entered the United States duty-free under NAFTA tariff
preference provisions, implying that they met NAFTA’s rules-of-origin requirements.
On the same date the Department of Commerce published the preliminary results of the
changed circumstances review of the anti-dumping duty order on colour televisions from
Korea, in which the Department on a preliminary basis determined partially to revoke the
anti-dumping duty order with respect to Samsung.(4) On 5 January 1998, as a result of this
preliminary order, Korea informed the DSB that it was withdrawing its request for a panel but
reserving its right to reintroduce the request. On 2 September 1998, a final determination
was made by the US Department of Commerce that changed circumstances warranted
revocation of the anti-dumping duty order on colour televisions from Korea as it applied to
Samsung.(5) According to one Korean newspaper report, when the fourteen members of
Samsung’s trade dispute team heard the news that the United States had finally revoked the
anti-dumping measure, they shouted for joy that their struggle, which had lasted for more
than fourteen years, was finally over. At the DSB meeting on 22 September 1998 Korea
announced that it was definitively withdrawing the request for a panel because the antidumping duties had now been revoked.
V. Lessons for others: the players’ views and implications for developing
countries
The Korean players’ views
After the withdrawal of the request for a panel, each side touted the ‘successful outcome’ of
the case. The United States emphasized the facts that Samsung no longer exported colour
televisions from Korea and that imports of colour televisions from Korea were unlikely to
increase greatly. Korea emphasized the fact that an anti-dumping measure, widely thought to
be unfair and unjustifiably maintained for fifteen years, had finally been removed. While the
United States claimed that the filing of the request for a panel did not unduly affect the
outcome of the case, most of the Korean general public believed that the WTO petition had
played a crucial role in the US decision to withdraw the anti-dumping measure. In this case,
the anti-dumping measure had been in place for fifteen years, despite continual efforts by
Samsung and the Korean government to have it revoked, but soon after the case had been
filed with the WTO the measure was withdrawn. Some Korean newspapers reported that it
was only after Korea had filed the WTO case that the US Department of Commerce became
more responsive to the request by Samsung and Korea for the revocation of the anti-dumping
order. In November 1998, Samsung started to export higher-priced televisions to the United
States.
The success of the Samsung case, as well as the success of a subsequent WTO Case
Concerning Anti-Dumping Duty on Dynamic Random Access Memory Semiconductors (DRAMs)
of One Megabyte or Above, which had been filed against the United States at almost the same
time, did much to alleviate the general concern of the Korean public about and its resistance
to accepting that the WTO dispute system was fair and objective.
As a consequence, the Korean public also began to realize that the WTO was not just a tool
for other countries, but was one that Korea could use as well. These two cases also did much
to alleviate public concerns brought about by the non-favourable ruling on the Taxes on
Alcoholic Beverages case later in 1998.(6) Most Koreans, while perhaps still not enthusiastic
about the WTO, began to acknowledge that it was useful for Korea, and that it could be used
to eliminate unfair trade barriers in other countries, including the advanced and powerful
ones. The Korean public now acknowledges that the WTO is necessary for maintaining
international trade, and while the WTO may act ‘against’ Korea at times, it will also act ‘for’
Korea as circumstances warrant. As a trading nation, Korea needs the WTO.
Han-Soo Kim of MOFAT states that the results of this case encouraged Korea to use the DSM
more extensively. Other sources also state that the confidence and experience gained from
these two cases encouraged Korea to take the direction of ‘aggressive legalism’ in handling
trade disputes,(7) and it has now become one of the more active users of the DSM. While
cases are still brought against Korea, Korea is now as likely to be the complainant in the
WTO, as can be seen in Table 2.
Table 2
Cases brought by Korea, cases where Korea reserved third party rights
Date
Case
No.
Defendant
Subject
1996.6.19
DS46
Brazil
Export Financing Programme for Aircraft (by
Canada) (third party rights)
1996.10.3
DS54
Indonesia
Certain Measures Affecting the
1996.10.4
DS55
Automobile Industry (by
EC, Japan and United
States) (third party
rights)
Automobile Industry (by EC, Japan and United
States) (third party rights)
1996.11.29 DS59
Anti-dumping Duty on Imports of Colour
Television Receivers
1996.10.8
DS64
1997.7.10
DS89
United States
Anti-dumping Duty on Imports of Colour
Television Receivers
1997.8.14
DS99
United States
Anti-dumping Duty on Dynamic Random Access
Memory Semiconductors (DRAMs) of One
Megabyte or Above
1998.10.6
DS139 EC, Japan
DS142 EC
Certain Measures Affecting the Automotive
Industry (of Canada) (third party rights)
1998.8.3
DS141 EC
Anti-dumping Duties on Imports of CottonType Bed Linen from India (third party rights)
1998.10.6
DS146 EC
1999.5.1
DS175 United States
Measures Affecting the Automotive Sector (of
India) (third party rights)
1999.7.30
DS179 United States
Anti-dumping Measures on Stainless Steel
Plate in Coils and Stainless Steel Sheet and
Strip
1999.11.18 DS184 United States
Anti-dumping Measures on Certain Hot-Rolled
Steel Products from Japan (third party rights)
2000.6.13
DS202 United States
Definitive Safeguard Measures on Imports of
Circular Welded Carbon Quality Line Pipe
2000.11.30 DS214 United States
Definitive Safeguard Measures on Imports of
Steel Wire Rod and Circular Welded Carbon
Quality Line Pipe (third party rights)
2000.12.15 DS215 Philippines
Anti-dumping Measures Against Polypropylene
Resin
2000.12.21 DS217 United States
Continued Dumping and Subsidy Offset Act of
2000 (joint complainant)
2001.5.21
DS234
2002.1.30
DS244 United States
Sunset Review of Anti-Dumping Duties on
Corrosion-Resistant Carbon Steel Flat Products
from Japan (third party rights)
2002.3.20
DS251 United States
Definitive Safeguard Measures on Imports of
Certain Steel Products (Joint Complainant —
along with DS248, DS249, DS252, DS253,
DS254, DS258, DS259).
2002.10.7
DS268 United States
Sunset Reviews of Anti-Dumping Measures on
Oil Country Tubular Goods from Argentina
(third party rights)
2002.12.20 DS277 United States
Investigation of the International Trade
Commission in Softwood Lumber from Canada
(third party rights)
2003.6.30
DS296 United States
Countervailing Duty Investigation on Dynamic
Random Access Memory Semiconductors
(DRAM)
2003.7.25
DS299 EC
Countervailing Duty Investigation on Dynamic
Random Access Memory Semiconductors
(DRAM)
2003.9.3
DS301 EC
Measures Affecting Commercial Vessels
2004.2.13
DS307 EC
Aid for Commercial Vessels
Source: WTO, ‘Update of WTO Dispute Settlement Cases’, 26 March 2004.
VI. Lessons for developing countries
There are aspects of Korea’s experience which are useful for developing countries. One
should remember that when the United States applied its anti-dumping measure in 1983,
Korea was still very definitely a developing country, with GDP per capita of $2,000. The DSM
under WTO is much easier to use than the dispute settlement system of the pre-WTO GATT,
and developing countries should use the mechanism more actively. However, there are
problems which they must consider when using the DSM for the first time.
First, close co-operation must exist between the private sector and the government. While it
is the private sector which is the victim of trade barriers, it is the government which must
prepare and present the case. Thus, the private sector and the government must be able to
work closely together, to gather facts relevant to the case and form a viable legal and
diplomatic strategy.
Second, the WTO is useful only if it is used. Some members may be reluctant to bring a case
to the WTO because of lack of experience, the costs involved and fears of reprisal. However,
the Korean experience shows that gains can outweigh the possible costs. Careful preparation
can reduce much of the direct and indirect costs of the case. Further, as the government
deals with more cases, it will build experience, which will reduce costs in future cases. The
first DSM case should be seen as an investment in the future.
Third, the successful use of the WTO can improve the image of globalization, the government
and the WTO itself. Globalization is often seen as harmful because it supposedly imposes the
will of stronger countries on weaker ones. Korea’s experience with the WTO DSB shows that
this perception is not accurate. Measures which are inconsistent with WTO Agreements can be
addressed successfully by smaller countries if they are willing to try. Thus these countries
need not be passive, helpless ‘victims’ of globalization. Such empowerment should reduce
resistance against globalization. Further, when a government uses the DSM successfully,
people will gain confidence in the diplomatic, legal and economic capability of the
government. Finally, the successful use of the DSM can also show that the WTO is not a onesided tool of pro-globalization advanced countries, but rather a neutral tool for solving
disputes, which can build support for trade and globalization.
However, it is vitally important that a country chooses the ‘right’ case, especially for its first
case. Because the costs involved will be higher than for subsequent cases, and because the
public perception of the WTO will depend greatly on whether the first case is won or lost, the
government must choose the first case carefully, to make sure that it has willing partners in
the private sector and that it has a strong legal case. The government should also use any
resource that is open to it, including foreign legal help, even though it may incur high costs.
The indirect benefits of winning the case, through a more favourable view of the government,
and of trade and globalization, are likely to outweigh the costs of bringing the case.
NOTES:
1.- In this paper ‘Korea’ refers to the Republic of Korea (South Korea). back to text
2.- The original US decision can be found in US Federal Register 49 FR 18336. The details of the original decision
were taken from Taeho Bark, ‘Antidumping Restrictions against Korean Exports: Major Focus on Consumer Electronics
Products’, KIEP Working Paper, May 1991. Downloadable from the KIEP website, http://www.kiep.go.kr. back to text
3.- The details of the case are taken from WTO documents WT/DS89/1 and WT/DS89/7, which were presented to the
WTO by the government of Korea; see also Nae-hi Han et al. (1999), Case Studies of Korean Trade Conflicts by
Industry (in Korean), Seoul: POSCO Research Institute. back to text
4.- These findings are taken from US Federal Register 63 FR 46759. back to text
5.- Ibid. back to text
6.- Dukgeun Ahn (2002), ‘Korean Experience of the Dispute Settlement in the World Trading System’, KDI School
Working Paper 02-03, p. 17, though Ahn emphasizes the DRAM case more than the colour television case. back to text
7.- Wook Chae and Chang-Bae Seo (2001), Assessment of WTO and Korea-Related Trade Disputes and Policy
Implications (in Korean), Seoul: Korea Institute for International Economic Policy, p. 24, and Ahn, ‘Korean
Experience’, p. 18. back to text