## Facts

- Commerce issued final results of a fourth administrative review of a U.S. countervailing duty order on live swine from Canada (1988–1989 period).
- Canadian parties sought review before a binational panel under the Canada–U.S. Free Trade Agreement (FTA) Article 1904.
- The panel remanded Commerce’s determination, identifying legal and evidentiary deficiencies; Commerce issued a remand determination, which the panel again rejected and remanded with instructions.
- The United States (through USTR) invoked the FTA’s extraordinary challenge procedure, asserting the panel exceeded its authority by effectively applying an improper, overly demanding standard of review and substituting its judgment for Commerce’s.
- Canada argued the extraordinary challenge mechanism is narrowly limited and that disputes over record evaluation and deference do not meet the treaty threshold.

## Issues

1. Whether the panel “exceeded its powers, authority or jurisdiction” by materially failing to apply the prescribed standard of review governing review of Commerce determinations.
2. Whether any asserted panel errors materially affected the decision and threatened the integrity of the binational panel review process, as required for extraordinary challenge relief.

## Decision

- The Extraordinary Challenge Committee denied the United States’ request and left the panel’s decisions undisturbed.
- The Committee held the United States failed to show the panel materially failed to apply the appropriate standard of review or otherwise acted outside its authority under the treaty mechanism.
- The Committee treated the U.S. arguments as disagreements with the panel’s evaluation of the record and treatment of deference, not proof of a jurisdictional excess or qualifying procedural departure.
- The Committee found no showing that the alleged errors threatened the integrity of the binational panel review process.

## Legal Principles

- Extraordinary challenge review is a limited “safety valve,” not an additional merits appeal from a binational panel decision.
- Relief requires a material failure to apply the appropriate standard of review or a serious departure from a fundamental rule of procedure, plus a showing that the defect materially affected the decision and threatens the integrity of the binational panel system.
- Alleged misapplication of the substantial-evidence standard or insufficient deference to the investigating authority typically constitutes ordinary legal error, not a basis for extraordinary challenge absent clear abandonment of the governing standard or comparable jurisdictional overreach.
- Binational panels may remand agency determinations as unsupported by substantial evidence or not in accordance with law; exercising that review function does not itself amount to usurping the investigating authority’s role.

## Conclusion

The Extraordinary Challenge Committee refused to set aside the binational panel’s remand rulings in the live swine countervailing duty review, holding that the United States had not met the treaty’s stringent requirements for extraordinary challenge intervention and that the dispute amounted to a nonreviewable disagreement over record evaluation and deference rather than a threat to the binational review system.


In re Live Swine from Canada, ECC-93-1904-01USA, 1993 WL 566371 (Extraordinary Challenge Comm. 1993)