Argentina conducted a safeguard investigation into imports of footwear during the period from 1991 to 1996 and found the following data related to absolute levels of imports:
TOTAL IMPORTS OF FOOTWEAR INTO ARGENTINA,
1991-1996

Argentina then imposed safeguard measures that increased import duties on footwear from the bound rate of 35 percent to 200 percent. The European Community (now EU) and the United States brought an action at the WTO claiming that the data do not show an increase in absolute levels of imports as required by GATT Article XIX and the WTO Agreement on Safeguards. Argentina compared the 1991 figures to 1996 to show an increase. The EU and United States argued that using end points only was improper because it ignored intervening, declining trends over the period. A WTO panel held that Argentina's safeguard investigation was inadequate, and Argentina appealed to the WTO Appellate Body.
1. What is the role of a WTO panel in reviewing the safeguard investigations conducted by a national administrative agency?
2. What kind of "increased quantities" of imports must be found by the investigating authority in order to impose safeguard measures?
3. Locate the Agreement on Safeguards and read Article 2. Why did Argentina's exemption for footwear imported from MERCOSUR countries violate the WTO Agreements?

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QUANTITY (MILLION PAIRS) VALUE (US$ MILLIONS) 1991 8.86 44.41 110.87 1992 16.63 1993 21.78 128.76 1994 19.84 141.48 1995 15.07 114.22 1996 13.47 116.61