Introductionback to top
Dumping in the GATT/WTO
What is dumping?
Dumping is, in general, a situation of
international price discrimination, where the price of a product when sold
in the importing country is less than the price of that product in the
market of the exporting country. Thus, in the simplest of cases, one
identifies dumping simply by comparing prices in two markets. However, the
situation is rarely, if ever, that simple, and in most cases it is
necessary to undertake a series of complex analytical steps in order to
determine the appropriate price in the market of the exporting country
(known as the “normal value”) and the appropriate price in the market of
the importing country (known as the “export price”) so as to be able to
undertake an appropriate comparison.
Article VI of GATT and the Anti-Dumping Agreement
The GATT 1994 sets forth a number of basic
principles applicable in trade between Members of the WTO, including the
most favoured nation principle. It also requires that imported products
not be subject to internal taxes or other changes in excess of those
imposed on domestic goods, and that imported goods in other respects be
accorded treatment no less favourable than domestic goods under domestic
laws and regulations, and establishes rules regarding quantitative
restrictions, fees and formalities related to importation, and customs
valuation. Members of the WTO also agreed to the establishment of
schedules of bound tariff rates. Article VI of GATT 1994, on the other
hand, explicitly authorizes the imposition of a specific anti-dumping duty
on imports from a particular source, in excess of bound rates, in cases
where dumping causes or threatens injury to a domestic industry, or
materially retards the establishment of a domestic industry.
The Agreement on Implementation of Article VI of GATT 1994, commonly known as the Anti-Dumping Agreement, provides further elaboration on the basic principles set forth in Article VI itself, to govern the investigation, determination, and application, of anti-dumping duties.
As tariff rates were lowered over time following
the original GATT agreement, anti-dumping duties were increasingly
imposed, and the inadequacy of Article VI to govern their imposition
became ever more apparent. For instance, Article VI requires a
determination of material injury, but does not contain any guidance as to
criteria for determining whether such injury exists, and addresses the
methodology for establishing the existence of dumping in only the most
general fashion. Consequently, contracting parties to GATT negotiated more
detailed Codes relating to anti-dumping. The first such Code, the
Agreement on Anti-Dumping Practices, entered into force in 1967 as a
result of the Kennedy Round. However, the United States never signed the
Kennedy Round Code, and as a result the Code had little practical
The Tokyo Round Code, which entered into force in 1980, represented a quantum leap forward. Substantively, it provided enormously more guidance about the determination of dumping and of injury than did Article VI. Equally important, it set out in substantial detail certain procedural and due process requirements that must be fulfilled in the conduct of investigations. Nevertheless, the Code still represented no more than a general framework for countries to follow in conducting investigations and imposing duties. It was also marked by ambiguities on numerous controversial points, and was limited by the fact that only the 27 Parties to the Code were bound by its requirements.
The UR Agreement
Dumping is defined in the Agreement on
Implementation of Article VI of the GATT 1994 (The Anti-Dumping Agreement)
as the introduction of a product into the commerce of another country at
less than its normal value. Under Article VI of GATT 1994, and the
Anti-Dumping Agreement, WTO Members can impose anti-dumping measures, if,
after investigation in accordance with the Agreement, a determination is
made (a) that dumping is occurring, (b) that the domestic industry
producing the like product in the importing country is suffering material
injury, and (c) that there is a causal link between the two. In addition
to substantive rules governing the determination of dumping, injury, and
causal link, the Agreement sets forth detailed procedural rules for the
initiation and conduct of investigations, the imposition of measures, and
the duration and review of measures.
Committee on Anti-Dumping Practices
The Committee, which meets at least twice a
year, provides Members of the WTO the opportunity to discuss any matters
relating to the Anti-Dumping Agreement (Article 16). The Committee has
undertaken the review of national legislations notified to the WTO. This
offers the opportunity to raise questions concerning the operation of
national anti-dumping laws and regulations, and also questions concerning
the consistency of national practice with the Anti-Dumping Agreement. The
Committee also reviews notifications of anti-dumping actions taken by
Members, providing the opportunity to discuss issues raised regarding
The Committee has created a separate body, the Ad Hoc Group on Implementation, which is open to all Members of the WTO, and which is expected to focus on technical issues of implementation: that is, the how to questions that frequently arise in the administration of anti-dumping laws.
Disputes in the anti-dumping area are subject to
binding dispute settlement before the Dispute Settlement Body of the WTO,
in accordance with the provisions of the Dispute Settlement Understanding
(DSU) (Article 17). Members may challenge the imposition of anti-dumping
measures, in some cases may challenge the imposition of preliminary
anti-dumping measures, and can raise all issues of compliance with the
requirements of the Agreement, before a panel established under the DSU.
In disputes under the Anti-Dumping Agreement, a special standard of review
is applicable to a panel's review of the determination of the national
authorities imposing the measure. The standard provides for a certain
amount of deference to national authorities in their establishment of
facts and interpretation of law, and is intended to prevent dispute
settlement panels from making decisions based purely on their own views.
The standard of review is only for anti-dumping disputes, and a
Ministerial Decision provides that it shall be reviewed after three years
to determine whether it is capable of general application.
All WTO Members are required to bring their
anti-dumping legislation into conformity with the Anti-Dumping Agreement,
and to notify that legislation to the Committee on Anti-Dumping Practices.
While the Committee does not approve or disapprove any Members'
legislation, the legislations are reviewed in the Committee, with
questions posed by Members, and discussions about the consistency of a
particular Member's implementation in national legislation of the
requirements of the Agreement.
In addition, Members are required to notify the Committee twice a year about all anti-dumping investigations, measures, and actions taken. The Committee has adopted a standard format for these notifications, which are subject to review in the Committee.
Finally, Members are required to promptly notify the Committee of preliminary and final anti-dumping actions taken, including in their notification certain minimum information required by Guidelines agreed to by the Committee. These notifications are also subject to review in the Committee.
Determination of dumpingback to top
Determination of normal value
The normal value is generally the
price of the product at issue, in the ordinary course of trade, when
destined for consumption in the exporting country market. In certain
circumstances, for example when there are no sales in the domestic market,
it may not be possible to determine normal value on this basis. The
Agreement provides alternative methods for the determination of normal
value in such cases.
Sales in the ordinary course of trade
One of the most complicated
questions in anti-dumping investigations is the determination whether
sales in the exporting country market are made in the ordinary course of
trade or not. One of the bases on which countries may determine that
sales are not made in the ordinary course of trade is if sales in the
domestic market of the exporter are made below cost. The Agreement defines
the specific circumstances in which home market sales at prices below the
cost of production may be considered as not made in theordinary course
of trade", and thus may be disregarded in the determination of normal
value (Article 2). Those sales must be made at prices that are below per
unit fixed and variable costs plus administrative, selling and general
costs, they must be made within an extended period of time (normally one
year, but in no case less than six months), and they must be made in
substantial quantities. Sales are made in substantial quantities when (a)
the weighted average selling price is below the weighted average cost; of
(b) 20% of the sales by volume were below cost. Finally, sales made below
costs may only be disregarded in the determination of normal value where
they do not allow for recovery of costs within a reasonable period of
time. If sales are below cost when made but are above the weighted average
cost over the period of the investigation, the Agreement provides that
they allow for recovery of costs within a reasonable period of time.
Insufficient volume of sales
If there are sales below cost that meet the criteria set out in the Agreement,
they can simply be ignored in the calculation of normal value, and normal value
will be determined based on the remaining sales. However, exclusion of these
below-cost sales may result in a level of sales insufficient to determine normal
value based on home market prices. It is obvious that, in the case where there
are no sales in the exporting country of the product under investigation, it is
not possible to base normal value on such sales, and the Agreement recognizes
this. However, it is also possible that, while there are some sales in the
exporting country's market, the level of such sales is so low that its
significance is questionable. Thus, the Agreement recognizes that in some cases
sales in the home market may be so low in volume that they do not permit a
proper comparison of home market and export prices. It provides that the level
of home market sales is sufficient if home market sales constitute 5 per cent or
more of the export sales in the country conducting the investigation, provided
that a lower ratio should be accepted if the volume of domestic sales
nevertheless is of sufficient magnitude to provide for a fair comparison.
Alternative bases for calculating normal value
Two alternatives are provided for the
determination of normal value if sales in the exporting country market are
not an appropriate basis. These are (a) the price at which the product is
sold to a third country; and
(b) the constructed value of the product, which is calculated on the basis of the cost of production, plus selling, general, and administrative expenses, and profits. The Agreement contains detailed and specific rules for the determination of a constructed value, governing the information to be used in determining the amounts for costs, expenses, and profits, the allocation of these elements of constructed value to the specific product in question, and adjustments for particular situations such as start-up costs and non-recurring cost items.
Constructed normal value
The determination of normal value
based on cost of production, selling, general and administrative expenses,
and profits is referred to as the constructed normal value The rules
for determining whether sales are made below cost also apply to performing
a constructed normal value calculation. The principal difference is the
inclusion of a reasonable amount for profits in the constructed value.
Third country price as normal value
The other alternative method for
determining normal value is to look at the comparable price of the like
product when exported to an appropriate third country, provided that price
is representative. The Agreement does not specify any criteria for
determining what third country is appropriate.
In the situation where products are
not imported directly from the country of manufacture, but are exported
from an intermediate country, the Agreement provides that the normal value
shall be determined on the basis of sales in the market of the exporting
country. However, the Agreement recognizes that this may result in an
inappropriate or impossible comparison, for instance if the product is not
produced in the exporting country, there is no comparable price for the
product in the exporting country, or the product is merely transshipped
through the exporting country. In such cases, the normal value may be
determined on the basis of the price of the product in the country of
origin, and not the price in the exporting country.
In the particular situation of economies where the government has a complete or substantially complete monopoly of its trade and where all domestic prices are fixed by the State, GATT 1994 and the Agreement recognize that a strict comparison with home market prices may not be appropriate. Importing countries have thus exercised significant discretion in the calculation of normal value of products exported from non-market economies.
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Determination of export price
The export price will normally
be based on the transaction price at which the foreign producer sells the
product to an importer in the importing country. However, as is the case
with normal value, the Agreement recognizes that this transaction price
may not be appropriate for purposes of comparison.
There may be no export price
for a given product, for instance, if the export transaction is an
internal transfer, or if the product is exchanged in a barter transaction.
In addition, the transaction price at which the exporter sells the product
to the importing country may be unreliable because of an association or a
compensatory arrangement between the exporter and the importer or a third
party. In such a case, the transaction price may not be an arms-length
market price, but may be manipulated, for instance for tax purposes. The
Agreement recognizes that, in such cases, an alternative method of
determining an appropriate export price for comparison is needed.
Alternative method of calculation
The Agreement provides that in circumstances where there is no export price, or where the export price is unreliable due to an association or compensatory arrangement between the exporter and the importer or a third party, an alternative method may be used to determine the export price. this results in a constructed export price, and is calculated on the basis of the price at which the imported products are first resold in an independent buyer. If the imported product is not resold to an independent buyer, or is not resold as imported, the authorities may determine a reasonable basis on which to calculate the export price.
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Fair comparison of normal value and export price
The Agreement requires that a fair comparison of the export price and the
normal value be made. The basic requirements for a fair comparison are
that the prices being compared are those of sales made at the same level
of trade, normally the ex-factory level, and of sales made at as nearly as
possible the same time.
As part of the Agreement's requirements regarding transparency and participation, the investigating authorities are required to inform parties of the information needed to ensure a fair comparison, for instance, information regarding adjustments, allowances, and currency conversion, and may not impose an unreasonable burden of proof on parties.
To ensure that prices are comparable, the Agreement requires that
adjustments be made to either the normal value, or the export price, or
both, to account for differences in the product, or in the circumstances
of sale, in the importing and exporting markets. These allowances must be
made for differences in conditions and terms of sale, taxation,
quantities, physical characteristics, and other differences demonstrated
to affect price comparability.
Adjustments in case of constructed export price
The Agreement also provides specific rules on the adjustment to be made if
the comparison of normal value is to a constructed export price. In those
circumstances, allowance must be made for costs, including duties and
taxes, incurred between the importation of the product and the resale to
the first independent purchaser, as well as for profits accruing. If price
comparability has been affected, the Agreement requires either that the
normal value be established at a level of trade equivalent to that of the
constructed export price, which is likely to require an adjustment, or
allowance must be made for differences in conditions and terms of sale,
taxation, quantities, physical characteristics, and other matters
demonstrated to affect price comparability.
Conversion of currency
Where the comparison of normal value and export price requires conversion of currency, the Agreement provides specific rules governing that conversion (Article 2.4.1). Thus, the exchange rate used should be that in effect on the date of sale (date of contract, invoice, purchase order or order confirmation, whichever establishes material terms of sale). If a forward currency sale is directly linked to export sale, the exchange rate of forward currency sale must be used. Moreover, the Agreement requires that exchange rate fluctuations be ignored, and that exporters be allowed at least 60 days to adjust export prices for sustained exchange rate movements.
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Calculation of dumping margins and duty assessment
Calculation of dumping margins
The Agreement contains rules governing the calculation of dumping margins.
In the usual case, the Agreement requires either the comparison of the
weighted average normal value to the weighted average of all comparable
export prices, or a transaction-to-transaction comparison of normal value
and export price (Article 2.4.2). A different basis of comparison can be
used if there is targeted dumping: that is, if a pattern exists of
export prices differing significantly among different purchasers, regions
or time periods. In this situation, if the investigating authorities
provide an explanation as to why such differences cannot be taken into
account in weighted average-to-weighted average or
transaction-to-transaction comparisons, the weighted average normal value
can be compared to the export prices on individual transactions.
Refund or reimbursement
The Agreement requires Members to collect duties on a non-discriminatory
basis on imports from all sources found to be dumped and causing injury,
except with respect to sources from which a price undertaking has been
accepted. Moreover, the amount of the duty collected may not exceed the
dumping margin, although it may be a lesser amount. The Agreement
specifies two mechanisms to ensure that excessive duties are not
collected. The choice of mechanism depends on the nature of the duty
collection process. If a Member allows importation and collects an
estimated anti-dumping duty, and only later calculates the specific amount
of anti-dumping duty to be paid, the Agreement requires that the final
determination of the amount must take place as soon as possible, upon
request for a final assessment. In both cases, the Agreement provides that
the final decision of the authorities must normally be made within 12
months of a request for refund or final assessment, and that any refund
should be made within 90 days.
Individual exporter dumping margins
The Agreement requires that, when anti-dumping duties are imposed, a
dumping margin be calculated for each exporter. However, it is recognized
that this may not be possible in all cases, and thus the Agreement allows
investigating authorities to limit the number of exporters, importers, or
products individually considered, and impose an anti-dumping duty on
uninvestigated sources on the basis of the weighted average dumping margin
actually established for the exporters or producers actually examined. The
investigating authorities are precluded from including in the calculation
of that weighted average dumping margin any dumping margins that are de
minimis, zero, or based on the facts available rather than a full
investigation, and must calculate an individual margin for any exporter or
producer who provides the necessary information during the course of the
The Agreement makes provision for the assessment of anti-dumping duties on exports from producers or exporters who were not sources of imports considered during the period of investigation. In this circumstance, the investigating authorities are required to conduct an expedited review to determine a specific margin of dumping attributable to the exports of such a new shipper. While that review is in progress, the authorities may request guarantees or withhold appraisement on imports, but may not actually collect anti-dumping duties on those imports.
Determination of injury and casual linkback to top
Definition (Article 2.6)
An important decision must be made early in each investigation to determine the domestic like product. Like product is defined in the Agreement as a product which is identical, i.e. alike in all respects to the product under consideration or, in the absence of such a product, another product which, although not alike in all respects, has characteristics closely resembling those of the product under consideration. The determination involves first examining the imported product or products that are alleged to be dumped, and then establishing what domestically produced product or products are the appropriate like product. The decision regarding the like product is important because it is the basis of determining which companies constitute the domestic industry, and that determination in turn governs the scope of the investigation and determination of injury and causal link.
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Definition (Article 4)
The Agreement defines the term domestic
industry to mean the domestic producers as a whole of the like products
or those of them whose collective output of the products constitutes a
major proportion of the total domestic production of those products.
Related domestic producers
The Agreement recognizes that in certain circumstances, it may not be
appropriate to include all producers of the like product in the domestic
industry. Thus, Members are permitted to exclude from the domestic
industry producers related to the exporters or importers under
investigation, and producers who are themselves importers of the allegedly
dumped product. The Agreement provides that a producer can be deemed
related to an exporter or importer of the allegedly dumped product if
there is a relationship of control between them, and if there is reason to
believe that the relationship causes the domestic producer to behave
differently from non-related producers.
Regional domestic industry
The Agreement contains special rules that allow in exceptional
circumstances, consideration of injury to producers comprising a regional
industry. A regional industry may be found to exist in a separate
competitive market if producers within that market sell all or almost all
of their production of the like product in that market, and demand for the
like product in that market is not to any substantial degree supplied by
producers of the like product located outside that market. If this is the
case, investigating authorities may find that injury exists, even if a
major proportion of the entire domestic industry, including producers
outside the region, is not materially injured. However, a finding of
injury to the regional industry is only allowed if (1) there is a
concentration of dumped imports into the market served by the regional
industry, and (2) dumped imports are causing injury to the producers of
all or almost all of the production within that market.
Imposition of duties in regional industry cases
If an affirmative determination is based on injury to a regional industry, the Agreement requires investigating authorities to limit the duties to products consigned for final consumption in the region in question, if constitutionally possible. If the Constitutional law of a Member precludes the collection of duties on imports to the region, the investigating authorities may levy duties on all imports of the product, without limitation, if anti-dumping duties cannot be limited to the imports from specific producers supplying the region. However, before imposing those duties, the investigating authorities must offer exporters an opportunity to cease dumping in the region or enter a price undertaking.
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Types of injury
The Agreement provides that, in order to impose anti-dumping measures, the
investigating authorities of the importing Member must make a
determination of injury. The Agreement defines the term injury to mean
either (i) material injury to a domestic industry, (ii) threat of material
injury to a domestic industry, or (iii) material retardation of the
establishment of a domestic industry, but is silent on the evaluation of
material retardation of the establishment of a domestic industry.
Basic requirements for determination of material injury
The Agreement does not define the notion of material. However, it does
require that a determination of injury must be based on positive evidence
and involve an objective examination of (i) the volume of dumped imports
and the effect of the dumped imports on prices in the domestic market for
like products, and (ii) the consequent impact of the dumped imports on
domestic producers of the like product. Article 3 contains some specific
additional factors to be considered in the evaluation of these two basic
elements, but does not provide detailed guidance on how these factors are
to be evaluated or weighed, or on how the determination of causal link is
to be made.
Basic requirements for determination of threat of material injury
The Agreement sets forth factors to be considered in the evaluation of threat of material injury. These include the rate of increase of dumped imports, the capacity of the exporter(s), the likely effects of prices of dumped imports, and inventories. There is no further elaboration on these factors, or on how they are to be evaluated. The Agreement does, however, specify that a determination of threat of material injury shall be based on facts, and not merely on allegation, conjecture, or remote possibility, and moreover, that the change in circumstances which would create a situation where dumped imports caused material injury must be clearly foreseen and imminent.
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Elements of analysis
Consideration of volume effects of dumped imports
The Agreement requires investigating authorities to consider whether there
has been a significant increase in the dumped imports, either in absolute
terms or relative to production or consumption in the domestic industry.
Consideration of price effects of dumped imports
Consideration of price effects of dumped imports
In addition, the Agreement requires investigating authorities to consider
whether there has been significant price undercutting by the dumped
imports as compared with the price of a like product of the importing
Member. Investigating authorities are also required to consider whether
the effect of dumped imports is otherwise to depress prices to a
significant degree, or to prevent price increases, which otherwise would
have occurred, to a significant degree.
Evaluation of volume and price effects of dumped imports
The Agreement provides that no one or several of these factors can
necessarily give decisive guidance. It does not specify how the
investigating authorities are to evaluate the volume and price effects of
dumped imports: merely that consideration of these effects is required.
Thus, investigating authorities have to develop analytical methods for
undertaking the consideration of these factors. Moreover, since no single
factor or combination of factors will necessarily result in either an
affirmative or negative determination, in each case investigating
authorities have to evaluate which factors are relevant, and which are
important, in light of the circumstances of the particular case at issue.
Examination of impact of dumped imports on the domestic industry
The Agreement provides that, in examining the impact of dumped imports on
the domestic industry, the authorities are to evaluate all relevant
economic factors bearing upon the state of the domestic industry. The
Agreement lists a number of factors which must be considered, including
actual or potential declines in sales, profits, output, market share,
productivity, return on investments, utilization of capacity, actual or
potential effects on cash flow, inventories, employment, wages, growth,
ability to raise capital or investments, and the magnitude of the margin
of dumping. However, the list is not exhaustive, and other factors may be
deemed relevant. In addition, the Agreement again specifies that no single
factor or combination of factors will necessarily lead to either an
affirmative or negative determination.
Demonstration of causal link
The Agreement requires a demonstration that there is a causal relationship
between the dumped imports and the injury to the domestic industry. This
demonstration must be based on an examination of all relevant evidence.
The Agreement does not specify particular factors or give guidance in how
relevant evidence is to be evaluated. Article 3.5 does require, however,
that known factors other than dumped imports which may be causing injury
must be examined, gives examples of factors (such as changes in the
pattern of demand, and developments in technology) which may be relevant,
and specifies that injury caused by such other factors must not be
attributed to dumped imports. Thus, the investigating authorities must
develop analytical methods for determining what evidence is or may be
relevant in a particular case, and for evaluating that evidence, taking
account of other factors which may be causing injury.
Cumulative analysis refers to the consideration of dumped imports from more than one country on a combined basis in assessing whether dumped imports cause injury to the domestic industry. Obviously, since such analysis will increase the volume of imports whose impact is being considered, there is a greater possibility of an affirmative determination in a case involving cumulative analysis. The practice of cumulative analysis was the subject of much controversy under the Tokyo Round Code, and in the negotiations for the Agreement. Article 3.3 of the Agreement establishes the conditions in which a cumulative evaluation of the effects of dumped imports from more than one country may be undertaken. The authorities must determine that the margin of dumping from each country is not de minimis, that the volume of imports from each country is not negligible, and that a cumulative assessment is appropriate in light of the conditions of competition among the imports and between the imports and the domestic like product. De minimis dumping margins and negligible import volumes are defined in the Agreement.
Procedural requirementsback to top
Agreement Article 5 of the Agreement establishes
the requirements for the initiation of investigations. The Agreement
specifies that investigations should generally be initiated on the basis
of written request submitted “by or on behalf of” a domestic industry.
This “standing” requirement includes numerical limits for determining
whether there is sufficient support by domestic producers to conclude that
the request is made by or on behalf of the domestic industry, and thereby
warrants initiation. The Agreement establishes requirements for evidence
of dumping, injury, and causality, as well as other information regarding
the product, industry, importers, exporters, and other matters, in written
applications for anti-dumping relief, and specifies that, in special
circumstances when authorities initiate without a written application from
a domestic industry, they shall proceed only if they have sufficient
evidence of dumping, injury, and causality. In order to ensure that
investigations without merit are not continued, potentially disrupting
legitimate trade, Article 5.8 provides for immediate termination of
investigations in the event the volume of imports is negligible or the
margin of dumping is de minimis, and establishes numeric thresholds
for these determinations. In order to minimize the trade-disruptive effect
of investigations, Article 5.10 specifies that investigations should be
completed within one year, and in no case more than 18 months, after
Article 6 of the Agreement sets forth detailed rules on the process of investigation, including the collection of evidence and the use of sampling techniques. It requires authorities to guarantee the confidentiality of sensitive information and verify the information on which determinations are based. In addition, to ensure the transparency of proceedings, authorities are required to disclose the information on which determinations are to be based to interested parties and provide them with adequate opportunity to comment. The Agreement establishes the rights of parties to participate in the investigation, including the right to meet with parties with adverse interests, for instance in a public hearing. Further guidance on the conduct of investigations is contained in two Annexes to the Agreement, which set forth rules for the on-the-spot investigations to verify information obtained from foreign parties, as well as rules for the use of best information available in the event a party refuses access to, or does not provide, requested information, or significantly impedes the investigation.
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Provisional measures and price undertakings
Imposition of provisional measures
Article 7 of the Agreement provides rules
relating to the imposition of provisional measures. These include the
requirement that authorities make a preliminary affirmative determination
of dumping, injury, and causality before applying provisional measures,
and the requirement that no provisional measures may be applied sooner
than 60 days after initiation of an investigation. Provisional measures
may take the form of a provisional duty or, preferably, a security by cash
deposit or bond equal to the amount of the preliminarily determined margin
of dumping. The Agreement also contains time limits for the imposition of
provisional measures generally four months, with a possible extension to
six months at the request of exporters. If a Member, in its administration
of anti-dumping duties, imposes duties lower than the margin of dumping
when these are sufficient to remove injury, the period of provisional
measures is generally six months, with a possible extension to nine months
at the request of exporters.
Article 8 of the Agreement contains rules on the offering and acceptance
of price undertakings, in lieu of the imposition of anti-dumping duties.
It establishes the principle that undertakings between any exporter and
the importing Member, to revise prices, or cease exports at dumped prices,
may be entered into to settle an investigation, but only after a
preliminary affirmative determination of dumping, injury and causality has
been made. It also establishes that undertakings are voluntary on the part
of both exporters and investigating authorities. In addition, an exporter
may request that the investigation be continued after an undertaking has
been accepted, and if a final determination of no dumping, no injury, or
no causality results, the undertaking shall automatically lapse.
Collection of duties
Imposition and collection of duties
Article 9 of the Agreement establishes the general principle that
imposition of anti-dumping duties is optional, even if all the
requirements for imposition have been met. It also states the desirability
of application of a lesser duty rule. Under a lesser duty rule,
authorities impose duties at a level lower than the margin of dumping if
this level is adequate to remove injury. In addition, the Agreement
contains rules intended to ensure that duties in excess of the dumping
margin are not collected, and rules for applying duties to new shippers.
Retroactive application of duties
The Agreement sets forth the general principle that both provisional and final anti-dumping duties may be applied only as of the date on which the determinations of dumping, injury and causality have been made. However, recognizing that injury may have occurred during the period of investigation, or that exporters may have taken actions to avoid the imposition of an anti-dumping duty, Article 10 contains rules for the retroactive imposition of dumping duties in specified circumstances. If the imposition of anti-dumping duties is based on a finding of material injury, as opposed to threat of material injury or material retardation of the establishment of a domestic industry, anti-dumping duties may be collected as of the date provisional measures were imposed. If provisional duties were collected in an amount greater than the amount of the final duty, or if the imposition of duties is based on a finding of threat of material injury or material retardation, a refund of provisional duties is required. Article 10.6 provides for retroactive application of final duties to a date not more than 90 days prior to the application of provisional measures in certain exceptional circumstances involving a history of dumping, massive dumped imports, and potential undermining of the remedial effects of the final duty.
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Review and public notice
Duration, termination, and review of anti-dumping measures
Article 11 of the Agreement establishes rules for the duration of
anti-dumping duties, and requirements for periodic review of the
continuing need, if any, for the imposition of anti-dumping duties or
price undertakings. These requirements respond to the concern raised by
the practice of some countries of leaving anti-dumping duties in place
indefinitely. The sunset requirement establishes that dumping duties
shall normally terminate no later than five years after first being
applied, unless a review investigation prior to that date establishes that
expiry of the duty would be likely to lead to continuation or recurrence
of dumping and injury. This five year sunset provision also applies to
price undertakings. The Agreement requires authorities to review the need
for the continued imposition of a duty upon request of an interested
Article 12 sets forth detailed requirements for public notice by investigating authorities of the initiation of investigations, preliminary and final determinations, and undertakings. The public notice must disclose non-confidential information concerning the parties, the product, the margins of dumping, the facts revealed during the investigation, and the reasons for the determinations made by the authorities, including the reasons for accepting and rejecting relevant arguments or claims made by exporters or importers. These public notice requirements are intended to increase the transparency of determinations, with the hope that this will increase the extent to which determinations are based on fact and solid reasoning.