Significance of WTO in the Case of Indonesia-South Korea’s : Dumping on Paper Product

WTO is the world trade organization that serves to regulate and facilitate international trade. The main objective of the WTO is to create healthy competition in the field of international trade for its members. While philosophically the WTO objectives is to improve living conditions and income, ensuring the creation of employment opportunities, increasing production and trade as well as optimize the utilization of world resources. WTO's main function is as a forum for its members to conduct trade negotiations as well as documenting all the results of negotiations and rules of international trade. WTO came into effect on January 1, 1995 agreed that the Agreement in the World Trade Organization agreement on the establishment of the World Trade Organization, signed the trade ministers of WTO member countries on 15 April 1994 in Marrakesh, Morocco. At that moment, the member of WTO reached 143 countries plus the 31 countries that are currently in the process of negotiations (accession) for entry into the WTO members.

By signing and ratifying the WTO, each member state has the legal right not to be treated with discrimination by other WTO members of both treatments in the field of tariff, non tariff and national treatment (national treatment). Beside that WTO member countries, particularly developing countries have the right to fight for their rights, for example through the WTO dispute settlement and blaming other countries policies that are considered detrimental to the interests of developing countries in various relevant forums in the WTO.Various WTO agreements can be used by developing countries to protect the interests of negrinya (in general domestic industry) of which proved to import an element of "unfair". Another important advantage is that the developing countries in shaping the international trade negotiations of the future that had so dominated countries. It is not possible if the developing countries are not in the WTO system.

There are 5 (five) basic principles of GATT / WTO, namely:

i. Equal treatment for all members (Most Favored Nations Treatment-MFN).
Article I of GATT 1994 requires all commitment made or signed within the framework of GATT, the WHO should be treated equally to all WTO member countries (non-discrimination principle) without conditions. For example a country is not allowed to impose different tariff rates to a country compared with other countries.

ii. Binding Tariff (Tariff bindings)
Article II of GATT 1994, each member country of GATT or the WTO should have a list of products that the level of import duty or tariff must be bound (legally bound). Binding of the tariff is intended to create the "predictability" in the business of international trade / exports. This means that a member state not allowed to arbitrarily alter or raise the level of tariffs

iii. National treatment (National treatment)
Article III of GATT 1994, a country is not allowed to treat the discrimination between imported products with domestic products (same product) for the purpose of protection. The types of actions prohibited under this provision, among others, charges in the country, the laws, regulations and requirements affecting the sale, offer for sale, purchase, transportation, distribution or use of products, regulation of the amount that requires a mixture, processing or use of the product domestic products.

iv. Only through tariff protection.
Article XI the protection of domestic industries through tariffs only permitted.

v. Special and differential treatment for developing countries

In this journal, I’d like to give a deeper information about WTO in a case study about the practice of dumping charges from Indonesia to South Korea. Indonesia as a country also a member of the WTO, have experienced the practice of dumping charges on paper products exported to South Korea. This case began when the South Korean paper industry filed anti-dumping petition against Indonesian paper products to the Korean Trade Commission (KTC) on September 30, 2002. The Indonesian paper products that was charged with dumping include 16 types of products, classified in groups uncoated paper and paper board used for writing, printing or other graphic purpose, and carbon paper, self-copy paper and other copying or transfer paper.
In the case of the alleged dumping of paper by South Korea to Indonesia in the company of paper products such exporter PT. Indah Kiat Pulp and Paper Tbk, PT. Pindo Deli Pulp and Mills, and PT. Paper Factory Tjiwi Kimia Tbk, and April Pine Paper Trading Pte. Ltd., Indonesia managed to win the anti-dumping disputes this. Indonesia has used its rights and usefulness of the mechanisms and principles of the WTO trading system of multilateralism, especially the principle of transparency.
Indonesia for the first time benefit from the dispute settlement mechanism or the Dispute Settlement Mechanism (DSM) as the main plaintiff (main complainant) who was injured on the application of trading rules applied by other WTO member countries. Indonesia objected to the enactment of anti-dumping policy to Korea in case of DSM Anti-Dumping Duties on Imports of Certain Paper from Indonesia.

On June 4, 2004, Indonesia took South Korea to make dispute settlement consultations on the imposition of anti-dumping measures South Korea against imports of paper products from Indonesia. The results of these consultations did not produce a satisfactory result for both parties. Indonesia then filed a request to the WTO DSB to South Korea revoke the anti-dumping actions in violation of its obligations in the WTO, and violates several articles of the Anti-Dumping provisions. On October 28, 2005, the WTO DSB Panel Report delivered to all members and stated that anti-dumping measures South Korea has been inconsistent and violates the provisions of the Anti-Dumping Agreement. Both parties eventually reached an agreement that Korea should implement the DSB recommendations and determine the timetable for the implementation of the DSB recommendations (reasonable period of time / Rpt).
Unfortunately until now South Korea has not also comply with DSB's decision, although it has expressed any import duties apply anti-dumping (BMAD) of paper products from Indonesia, because it has not revoked the imposition of import duties are the anti-dumping. WTO DSB has declared South Korea made a mistake in the procedure of paper anti-dumping investigations in Indonesia in 2003. For the DSB request that South Korea's decision to run this soon.

Sources :
P. Karns, Margareth. 2004. International Organizations : the Politics of Global Governance. USA : Lynne Rienner Publisher, Inc