. /.RESTRICTEDWORLD TRADE
ORGANIZATIONG/ADP/IG/W/21
24 March 2000
(00-1214)
Committee on Anti-Dumping Practices
Informal Group on Anti-CircumventionOriginal:  English
TOPIC 1 – WHAT CONSTITUTES CIRCUMVENTION?
Paper by Egypt
The following communication. dated 22 March 2000, has been received from the Permanent
Mission of Egypt.
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INTRODUCTION
The Ministerial Decision on Circumvention adopted at Marrakesh noted that circumvention of
anti-dumping duty formed a part of the negotiations which preceded the Agreement on
Implementation of Article VI of GATT 1994, but negotiators were unable to agree to a specific text.It was decided to refer this matter to the Committee on Anti-Dumping Practices.  The Informal Group
on Anti-Circumvention was then established to examine the matter.
The GATT 1994 is a free trade agreement.  It provides for derogations from free trade only
under certain circumstances and according to specific rules and procedures.
These include the rules and procedures set out for anti-dumping actions.  Suggestions were
raised to introduce a right for Members to extend and widen this to encompass administrative
discretion.  Egypt's view is that all actions on alleged circumvention (apart from those arising from
fraud) must be based on a full investigation following the procedures of the WTO Agreement.
ARE THERE RULES ON CIRCUMVENTION AT PRESENT?
The simplest forms of circumvention are false customs declarations or statements of fraud
through wrong classifications of goods, use of incorrect values or false origins of such goods.  These
types of circumvention would generally be unacceptable and the responsibility of its detection and
recovery in such cases would be a matter covered by Customs or Criminal law of Members.  TheAgreement on Implementation of Article VI of the GATT 1994, for example, does not restrict the
customs from verifying the accuracy of any statemen t, document or declaration presented for customs
valuation purposes.
There are no specific rules on this type of circumvention in the WTO Agreement and Egypt
agrees that this type of circumvention must be controlled.
There are Members who have apparently introduced unilateral procedures as regards
circumvention on anti-dumping measures although it was not apparent that any fraudulent activity
was involved and the behaviour can be interpreted as normal commercial behaviour.  These anti-circumvention measures apply duties on traded goods without observing the requirements andG/ADP/IG/W/21
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commitments set out in the WTO, which entail a full investigation and determination to be made prior
to any action being taken.  These problems do not indicate that there is any need to have unilateral
measures on anti-circumvention.
The WTO Agreement already has provisions on the definition of goods.  It is unfair to change
this definition unilaterally later.  So, if a change occurs to the nature of the goods, then a newinvestigation would be required.  Likewise, if the remedy covers semi-finished or finished goods and
imports of their components, then a new investigation is warranted.  It cannot be claimed that
dumping on one of the goods applies to another.  No new measures are needed as this is already
covered in the Agreement.  If the goods are produced in one country and the firm decided to export
from a plant in another country, then a new investigation on the new country may be initiated and
conducted.  The provisions on provisional measures (Article 7) may be considered, as well as the
provisions on retroactivity in Article 10.  Together these provisions would be an effective answer tothe perceived problem, and would preserve the rights of the parties involved.
CONCLUSION
Egypt sees the need for rules to control fraudu lent or misleading information being used to
evade anti-dumping duties.  Nevertheless, it is not advisable to adopt unilateral trade restrictive
practices without full investigation under the obligations set out in the Agreement, which would
certainly open a door to individual Members, interpretations and would further restrict the ability of
developing countries to participate in international trade and enjoy the benefits of it.
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