The dispute settlement body (DSB) of the World Trade Organisation (WTO), at its meeting on August 1, said that the continuous bond requirement (CBR) imposed by the US customs on the exports of shrimp to the country, was illegal and a violation of global trade practices.
The decision, which holds great significance to India, was taken based on the reports of the panel of judges and the appellate body. Cases had been filed by India and Thailand against the bond requirement of the US customs on exports of warm-water shrimp, prevalent since february 1, 2005.
According to CBR, exporters of shrimp to the US were required to post [i] a cash deposit equal to the margin of dumping found to exist in the investigation or the most recent assessment review or [ii] a basic bond amount or [iii] an enhanced continuous bond (equivalent to 100 per cent of the anti-dumping or countervailing duty rate established in the original anti-dumping or, countervailing duty or the most recent administrative review of anti-dumping duty multiplied by the value of imports made by the importer in the previous 12 months).
The US had appealed against the findings of the panel of judges and the appellate body report was issued on July 16. Now, the DSB has adopted the final report, which binds all parties involved. It is learnt that no further appeals will be allowed in this matter. The strict imposition of CBR had made exports to the US almost impossible.
The number of Indian exporters to the US has dropped to 81 this year from 258 in 2004. With India’s exports to the US badly hit, EU, China and Japan had emerged the largest importers of the country’s seafood items. The US share in the Indian seafood export basket had dropped to 6.72 per cent in 2007-08.
