RESTRICTEDWORLD TRADE
ORGANIZATIONG/ADP/Q1/PHL/2
G/SCM/Q1/PHL/2
8 April 2002
(02-1853)
Committee on Anti-Dumping Practices
Committee on Subsidies and Countervailing MeasuresOriginal:  English
NOTIFICATION OF LAWS AND REGULATIONS UNDER
ARTICLES 18.5 AND 32.6 OF THE AGREEMENTS
Questions Posed by the UNITED STATES Regarding
the Notification of PHILIPPINES1
The following communication, dated 4 April 2002, has been received from the Permanent
Mission of the United States.
_______________
1. Section 4 (“Penalty Clause”) of  “The An ti-dumping Act of 1999 ” (Republic Act No. 8752)
(the “Act”) and Article 25 of the Act’s Implementing Rules and Regulations (“Regulations”) appearto impose a fine and other penalties upon “those found guilty of dumping”.  The relevant provision
states as follows:
The importer’s licence or charter to do business shall be revoked for those found
guilty of dumping.  Further, its officers shall be disqualified from holding official
positions in corporations of other business entities in the Philippines.  A fine equal to
twice the definitive anti-dumping duty shall be imposed.
Please describe all circumstances under which this provision may be invoked.
2. Section 8 of the Regulations allows the Secretary to “suspend” imposition of the provisional
AD duty after taking into account several factors (among others), including:  (1) whether the
imposition of a provisional duty “will result in political or economic crisis”, or (2) will cause “asevere shortage of the like product in the domestic market”.  What standards will be applied in
determining whether this provision should be invoked?  Will such suspension of provisional duties be
temporary or permanent?  What effect will suspension of provisional duties have on the authority to
collect definitive duties?
3. Section 1l(k) of  the Regulations indicates that in situations where “export price” is unreliable
because of a relationship or compensatory arrangement between the foreign exporter and the importer
or a third party, the export price may be “constructed “ on the basis of the price at which the dumped
product is “first resold to an independent buyer, or if such product is not resold to an independent
buyer, on such reasonable basis as the Secretary or Commission may determine”. Similarly, Section301(s)(2) of the Act states that if the export price cannot be used, then “the export price may be
constructed based on such reasonable bases as the Secretary or the Commission may determine.”
What is meant by the term “independent buyer”?  What types of “relationships” or “compensatory
                                                     
1 G/ADP/N/1/PHL/2 and G/SCM/N/1/PHL/2G/ADP/Q1/PHL/2
G/SCM/Q1/PHL/2
Page 2
arrangements” will make an export price unre liable?  How will the Secretary or Commission
determine the constructed export price if such unreliable sales are not sold to an “independent” buyer?
4. Section 2(c) of the Regulations defines the term “Arm’s Length Transaction” as a “transaction
where the price is not affected by any relationship between the buyer and the seller, or if there is no
compensation, reimbursement, benefit or other consideration given in respect of price”.  What ismeant by the term “any relationship”?  Is this limited strictly to ownership interests, or can it involve
contractual and other relationships?
5. Section 11(b)(1) of the Regulations states that where the comparison is not “comparable”
because of a difference in physical characteristics, an adjustment may be made based on “a reasonableestimate of the market value of the difference”.  How will the Philippines calculate this reasonable
estimate?
6. Section 11(c) of the Regulations indicates it may be appropriate to resort to third country
sales, constructed value, or COP, inter alia , if “the particular market situation makes domestic sales
unsuitable for proper comparison (price does not reflect a fair price in normal market conditions e.g.
consignment or monopsony)”.  Please clarify what types of situations might be deemed “unsuitable
for proper comparison.  In particular, are there any situations other than “consignment sales” or
“monopsony” sales that might indicate that the home market price is not fair and thus should not be
used?
7. Section 301(e), as amended by the Act, states that, once an anti-dumping investigation is
initiated, “the respondent is given the opportunity to present evidences to prove that he is not involved
in dumping”.  Are the respondents also provided th e opportunity to submit evidence and argument on
the questions of material injury and causal link?
8. Section 301(f), as amended by the Act, states that when the Secretary makes an affirmative
preliminary finding in an anti-dumping investigation, “the burden of proof is shifted to the respondent
to rebut the preliminary finding”.
(a) Does this mean that the respondent has the burden of proof of establishing that there
is no material injury to the domestic industry and no causal link between the materialinjury and the dumped imports?  If so, how is such an assignment of a burden of
proof consistent with Article 3.1 of the AD Agreement, which requires that an injury
determination be “based on positive evidence” and “involve an objective
examination” by the investigating authority?
(b) Do the Philippine authorities conduct any further investigative activities after
issuance of the preliminary finding?
9. The second paragraph of section 3(d)(1) of the Regulations states that “[i]n assessing the
sufficiency of evidence provided in the application, the Secretary will only satisfy himself that there isevidence that indicates dumping or the likelihood of dumping, and material injury based on the
evidences submitted by the applicant”.  What is the significance of the word “only” in this provision?
Does it merely modify the phrase “evidence that indicates” to suggest that the evidentiary standard
pertaining to dumping and injury is lower at initiation than in making a determination?  Or does the
word “only” also modify the phrase “based on the evidences submitted by the applicant”?
10. Section 3(d)(4) of the Regulations states that the Philippine authorities may engage in a
regional industry analysis if two conditions are sa tisfied.  The first of these conditions is that
producers within the regional market “have the domina nt market share.”  How is this consistent withG/ADP/Q1/PHL/2
G/SCM/Q1/PHL/2
Page 3
Article 4.1(ii) of the AD Agreement, which states that the producers within a regional market “must
sell all or almost all of their production of the product in question in that market”?
11. Article 4.1(ii) of the AD Agreement requires, in the circumstance of regional industry
analysis, that there be a concentration of dumped imports into the regional market and that “the
dumped imports are causing injury to the producers of all or almost all of the production within such
market”.  How does Philippine law implement these requirements?
12. Do the Philippine authorities permit confidential information to be disclosed pursuant to
protective order, as authorized by footnote 17 to Article 6.5 of the AD Agreement?
13. Are the public notice requirements in Section 22(b) of the Implementing Rules applicable to
all the types of actions by the Philippine authorities described in Section 22(a) of the Implementing
Rules?  If not, how do the Philippine authorities implement the requirements of Article 12.2.1 of the
AD Agreement concerning imposition of provisional measures?
__________