The WTO adjudicating bodies faced some very tough questions in 2016: the status of non-market economies, the consistency of policies aiming to address tax evasion with the WTO, and the clash between environment and trade policies were all on the menu. Old issues, like the consistency of zeroing, resurfaced as well, albeit with a twist this time, since the Appellate Body (AB) had to address the question whether zeroing is consistent with the WTO when practiced in the realm of a methodology that was so far untested.

This paper presents a legal–economic analysis of the Appellate Body's decision in EU–Biodiesel (Argentina) that the WTO's Anti-Dumping Agreement (ADA) does not permit countries to take into account government-created price distortions of major inputs when calculating anti-dumping duties. In this case, the EU made adjustments to the price of biodiesel's principal input – soybeans – in determining the cost of production of biodiesel in Argentina. The adjustment was made based on the uncontested finding that the price of soybeans in Argentina was distorted by the existence of an export tax scheme that resulted in artificially low soybean prices. The Appellate Body found that the EU was not permitted to take tax policy-induced price distortions into account in calculating dumping margins. We analyze the economic rationale for Argentina's export tax system, distortions in biodiesel markets in Argentina and the EU, and the remaining trade policy options for addressing distorted international prices. We also assess whether existing subsidies disciplines would be more effective in addressing this problem and conclude that they would not.

India–Solar Cells is one of a growing number of WTO disputes that highlight the continuing tensions between climate change polices (and renewable energy manufacturing initiatives in particular) and established multilateral trading rules. The United States alleged that Indian policies discriminated against foreign solar cell suppliers operating in the Indian market. The Appellate Body broadly rejected India's arguments to justify the measure either under Article III.8 public procurement derogations or as a general exception under ‘short supply’ and ‘compliance with laws and regulations’ provision of Article XX of the GATT. We argue that the Appellate Body was correct both on legal and economic grounds. The case does highlight the continuing need for clarity about the allowed parameters for climate change policies within the multilateral trade system.

In US–Washing Machines, the WTO Appellate Body (AB) extended the prohibition of zeroing to the so-called exceptional (or W-T) methodology, where the dumping margin is established by comparing the weighted average normal value to export price of specific transactions. Given that the exceptional method was the only method under which the AB had not definitively rejected zeroing, this dispute may have hammered the last nail in the coffin of zeroing. Or, maybe not. The AB did not address a key issue, namely: What is the evidentiary standard that an investigating authority must meet in order to have legitimate recourse to W-T? In addition, the AB's suggested approach to aggregating dumping amounts across targeted and non-targeted groups may produce zeroing-like outcomes even if the authority does not resort to zeroing. It seems inevitable that future disputes will be required to address these issues, since history shows that at least some investigating authorities are gearing towards using this methodology ad nauseam. The AB has left zeroing to die another day.

Can a WTO Member discriminate against foreign suppliers of services located in jurisdictions that refuse to share information with a government to permit it to determine if its nationals engage in tax evasion? Does it matter if the Member uses standards developed by an international body as the criterion for deciding whether to impose measures? In Argentina–Financial Services, the WTO Appellate Body held that services from jurisdictions that share financial tax information may be different from services provided by jurisdictions that do not cooperate in supplying such information. It overruled a Panel finding that measures to increase taxes on financial transactions with non-cooperative jurisdictions were discriminatory. We argue that the AB reached the right conclusion on the basis of the wrong arguments; that it missed an important opportunity to clarify what WTO Members are permitted to do to enforce their domestic regulatory regimes; and increased the scope for confusion and future litigation by considering that the likeness of services and service suppliers may be a function of prevailing domestic regulatory regimes.

In October 2014, the European Union requested consultations with Russia under the WTO's dispute settlement system regarding Russia's tariff treatment of various agricultural and manufacturing products. Although most of the measures challenged by the EU were individual tariff lines, the final measure in its complaint was a ‘more general measure’ referred to as the systematic duty variation. A WTO Dispute Panel eventually ruled that the EU failed to establish the systematic nature of the duty treatment afforded by Russia to certain products. In this paper, we explore the Dispute Panel's ruling, as well as how claims of systematic non-compliance are treated in other legal settings. We conclude by exploring whether future WTO Panels should instead consider statistical evidence of systematic treatment to promote compliance.

The compliance Appellate Body decision marks the latest twist in the long-running EC–Fasteners dispute. The question before the AB is whether the European Union complied with earlier rulings on its anti-dumping procedures. Broadly, the AB found that the EU had not, generally ruling in favor of the People's Republic of China. In the process, the AB raised interesting questions about what it means to be a Non-Market Economy (NME) in the WTO. While NME status has traditionally led to large dumping margins, the AB approach in this case may lessen the consequences for China. Among other things, the case raises the interesting and important question of how pervasive the taint of NME status may be when calculating margins. By allowing for adjustments of certain costs, the AB seems to constrain the more draconian analogue country methodology of calculation.

In this paper, we examine the recent WTO dispute Colombia – Measures Relating to the Importation of Textiles, Apparel and Footwear. The dispute centers on the appropriate use of trade measures to target trade-related money laundering, the WTO consistency of such measures, and an ancillary question of appropriate time for remedies to be applied. The economics of the measures employed do not directly target the ostensible justification for the measures, while Colombia failed to convince the Panel and Appellate Body of key points related to the necessity of the measures taken. There has been success targeting trade-related money laundering following from cooperation of customs authorities and financial regulators to more directly target the agents involved. There may be a role for the WTO, in the form of steps taken to encourage such cooperation (as in Argentina – Measures Relating to Trade in Goods and Services). The basic lesson is that second best, blunt, and likely misdirected policies are not easily justified at the WTO, though more direct measures may be.

The dispute relates to anti-dumping measures imposed by the United States (US) on oil country tubular goods (OCTG) imported from the Republic of Korea (Korea). Korea challenged the ‘laws, regulations, administrative procedures and other measures’ through which the US maintains a ‘viability test’ in anti-dumping investigations, administrative reviews, and other aspects of anti-dumping proceedings ‘as such’ and ‘as applied’ in the underlying investigation in this dispute. Korea also challenged certain aspects of the final anti-dumping measure that was applied by the US on imports of Korean OCTG subsequent to a final determination of dumping by the US Department of Commerce (USDOC) in the underlying investigation. Moreover, Korea challenged certain conduct of the USDOC during the course of the investigation at issue. Finally, Korea challenged the USDOC's remand determination of 22 February 2016 that was issued while the current dispute was pending before the panel. This determination was taken by the USDOC subsequent to a review conducted by the US Court of International Trade (USCIT) on the final determination challenged by Korea in this dispute. The USCIT found aspects of the final determination to be inconsistent with US law and remanded that final determination to the USDOC to cure the relevant inconsistencies.

Indonesia challenged two measures of the United States' (US): first, the imposition of anti-dumping and countervailing duties (CVDs) on certain coated paper from Indonesia. In particular, Indonesia challenged certain aspects of the US States Department of Commerce (USDOC) final determination ‘as applied’ in its CVD investigation on certain coated paper from Indonesia, and the US International Trade Commission's (USCIT) final threat of injury determination regarding subsidized and dumped imports from Indonesia and China. Second, Indonesia challenged ‘as such’ Section 711(11)(B) of the US Tariff Act. In particular, Indonesia challenged the use of this provision in affirmative threat of injury determinations.