The decision by a three-member panel was the latest of a series in which zeroing -- a framework for calculating duties on goods sold at less than their price on the exporter's home market -- has been found illegal under WTO agreements.
The panel said the United States "has acted inconsistently with provisions of the Anti-Dumping Agreement and the GATT" -- key WTO accords -- and said it should bring its calculation method into line with the two agreements.
Zeroing, which is used by the U.S. Department of Commerce and can be applied to a variety of goods, has been widely condemned by other countries in the 154-member WTO.
Several, including the European Union, China, India, Japan and Mexico, declared an interest in Vietnam's case -- taken to the WTO in February 2010 -- and China launched its own case over shrimp in February this year.
WTO rules allow countries to impose duties on imports that they determine to be dumped to to be damaging sales by their domestic producers, but the calculation of how much the duties should be involves comparing batches of goods.
In zeroing, U.S. officials do not take into account cases where the imported goods are cheaper on their home market but apply across the board a duty rate based only on those that are more expensive at home.
Other shrimp producers argue that this is unfair.
Argentina, Brazil, Canada, Ecuador, the EU, Japan, Mexico, South Korea and Thailand have all won zeroing cases at the WTO, and in January this year the United States promised its trading partners that it would change the method.
In the interim, it has reduced its use of zeroing.
But in March, the U.S. International Trade Commission voted to continue import duties for five more years on shrimp from Thailand, the U.S. main supplier, from China, Vietnam, Brazil and India.
That followed strong lobbying from U.S. shrimpers in the Gulf of Mexico, reeling from last year's huge oil spill and from devastating hurricanes, who want zeroing to be continued to shield them while their industry recovers.
A spokesman for the U.S. Trade Representative's office in Washington welcomed the WTO's panel's rejection of Vietnam'scomplaints over some U.S. procedures under which it said old anti-dumping calculation practices were still being applied.
On the zeroing issue, the spokesman said it was important to remember a Commerce Department proposal in December on changing its calculation methods. That proposal had been put up for public comment and these were still under review. (Reuters)
