Trade: WTO Rules Group discusses new proposal on anti-dumping

Original Publication Date: 
24 June, 2005

Geneva, 2 June (Kanaga Raja) -- The WTO Negotiating Group on Rules, holding aweeklong meeting (30 May - 3 June), has received a new proposal with respect to thedetermination of dumping margins under the Anti-Dumping Agreement.

The proposal (TN/RL/W/181) was tabled by Norway on behalf of the 'Friends ofAnti-Dumping Negotiations (FANs)' group comprising Brazil, Chile, Israel, Japan,Korea, Norway, Switzerland, Chinese Taipei, Thailand and Hong Kong China.

The proposal, 'Issues Related to Article 6.10, including 'Limited Examination', andArticle 9.4 'All Other's Rate',' according to Norway, aims to clarify the relationshipbetween the dumping margins determined for different categories of exporters andproducers (examined and unexamined) under Article 6.10 and the duties imposedunder Article 9.4 of the Anti-Dumping Agreement.

Norway also proposed the insertion of a new sub-paragraph in Article 6.10 to ensurethe application of a single dumping margin for unexamined exporters or producers.

The proposal of the FANs with respect to Article 6.10 require that investigatingauthorities provide a reasoned and adequate explanation for a conclusion that thenumber of respondents is so 'large' as to make it 'impracticable' to comply with thegeneral obligation to provide an individual determination for each respondent; requirethat investigating authorities choose the sample in consultation with respondents;ensure that any sample is sufficiently representative of all respondents; ensure thatrespondents that are not part of a sample can obtain an individual margin bysubmitting necessary information, given that certain requirements are fulfilled; andensure that authorities determine one single dumping margin for all exporters orproducers not examined.

With respect to the use of sampling by investigating authorities in cases where thenumber of companies involved are so large as to make the determination of dumpingmargin impossible, the paper proposes that the sample must include respondentsrepresenting no less than two thirds of the total imports from the exporting countryunder investigation.

On Article 9.4 of the Anti-Dumping Agreement, concerning the determination ofanti-dumping duty on companies not examined by the investigating authorities, theFANs proposed the confirmation of the Appellate Body's rulings that the authoritiesmust determine one single 'all others rate' and that this rate is to be the weightedaverage of the dumping margins for all examined respondents that participated in theinvestigation.

The FANs' paper cites two Appellate Body (AB) rulings, one in the US Hot RolledSteel case and the second in the EC Bed Linen case. The paper says that it is clearfrom the AB's reasoning in these two rulings that Article 9.4 envisages one single 'allothers rate', with the investigating authorities retaining a discretion to levy a lesser,but not higher duty in individual cases. As a result, the paper said, there is no basisfor the authorities to apply anything other than a single rate to all these respondents.The paper has proposed codifying the AB's interpretation by making explicit in thetext of Article 9.4 that there is a single all others rate to be applied to all non-sampledrespondents.

In the discussions that followed, the US said that it could support a number ofconcepts contained in the FANs' paper, especially those promoting more transparencyand equity, such as ensuring that procedures for selecting respondents in investigationshould be fair and transparent.

The US however criticized the two-thirds threshold as too high, which it said woulddefeat the purpose of sampling and would make the investigation more costly.

The EU said this is one anti-dumping area that is very complex. It questioned why theFANs' paper did not distinguish between cooperating and non-cooperating companies.

Egypt asked the FANs for more clarification on proposed sampling procedures.

During the informal sessions of the meeting on 30 May, the Rules Group examinedin greater detail several proposals including a paper from Japan on 'Illustrative Listof Benchmarks for Determination of Material Injury and Causation'(TN/RL/GEN/42), two further submissions from the FANs on 'Proposals onProceedings Under Article 9' (TN/RL/GEN/44) and 'Proposals on the MandatoryApplication of the Lesser Duty Rule' (TN/RL/GEN/43), and from Egypt 'Proposalon Material Retardation' (TN/RL/GEN/40).

On 31 May, the Rules Group's Technical Group on Questionnaires and VerificationOutlines held its meeting.

The Group is expected to hold another informal session Friday to discuss fisheriessubsidies-related proposals including one from the EC titled 'Paper on Fisheries'(TN/RL//GEN/39), and one from the US on 'Fisheries Subsidies: Programmes forDecommissioning of Vessels and Licence Retirement' (TN/RL/GEN/41).