RESTRICTED
WORLD TRADE G/ADP/W/292
G/SCM/W/300
ORGANIZATION 26February 1996
(96-0701)
Original: English Committee onAnti-Dumping Practices
Committee onSubsidies andCountervailing Measures
REPLIES TOTHE QUESTIONS POSED BYHONG KONG1CONCERNING THE
NOTIFICATIONS PROVIDED BYTHE GOVERNMENT OFINDIA2OF
LAWS AND REGULATIONS UNDER ARTICLES 18.5AND 32.6
OFTHE AGREEMENTS
Thefollowing communication, dated 12February 1996, hasbeenreceived fromthePermanent
Mission ofIndia.
_______________
Questions ontheIndian Anti-dumping Legislation
Customs Tariff (Amendment) Act1995
1. Section 9A(1)(c) -Normal value
Onthedetermination ofdumping, Article 2.2oftheWTO A-DAgreement provides thatwhen
domestic sales inthehome country donotprovide aproper basis forcomparison, thenormal value
shallbeeither acomparable price ofthelikeproduct when exported toanappropriate thirdcountry
orthecostofproduction inthecountry oforigin plusareasonable amount ofSGAcosts andprofits.
Section 9A(1)(c)(ii) oftheCustoms Tariff (Amendment) Act1995provides thatwhen domestic
sales donotpermit aproper comparison, thenormal value shall beeither -
(a) thecomparable representative priceofthelikearticle whenexported fromtheexporting
country orterritory oranappropriate third country; or
(b) thecostofproduction ofthesaidarticle inthecountry oforigin along withreasonable
addition forSGAcosts andforprofits.
Question: Would India clarify thedrafting ofSection 9A(1)(c)(ii)(a) oftheActwithreference to
Article 2.2oftheWTO A-DAgreement?
Answer: Theintention istoconsider thenormal value which isthecomparable representative
price ofthelikearticle when exported from theexporting country orterritory toan
appropriate third country. Theuseoftheword "of" inplace of"to" in
Section 9A(1)(c)(ii)(a) isatypographical error.
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2. Section 9A(6) -Margin ofdumping
Article 9.3oftheWTO ADAgreement provides thattheanti-dumping dutyshall notexceed
themargin ofdumping. Articles 9.3.1-9.3.3 setouttheprocedures andrequirements forrefunds,
withseparate considerations given toassessment ofanti-dumping duties onretrospective andprospective
bases.
Section 9A(6) provides thatthemargin ofdumping shall, from timetotime, beascertained and
determined bytheCentral Government, aftersuchenquiry asitmayconsider necessary. Section 9A(1)
provides forimposition ofanti-dumping duties notexceeding themargin ofdumping. Itisnotapparent
thatthenotified legislation hasprovided forprocedures andrequirements forfinaldetermination of
liability andrefund when themargin ofdumping haschanged.
Question: IstheIndian assessment ofanti-dumping duties carried outonaretrospective or
prospective basis? What aretheprocedures andrequirements forfinaldetermination
ofliability andrefund when themargin ofdumping haschanged? Howwould India
ensure compliance ofitsobligations under Article 9.3oftheWTO A-DAgreement?
Answer: Theassessment ofanti-dumping duties iscarried outonaprospective basis. The
provisions ofrefund aregoverned byRule21oftheAnti-Dumping Rules which implies
immediate refund.
Customs Tariff (Identification, Assessment andCollection ofAnti-Dumping Duty onDumped
Articles andforDetermination ofInjury) Rules, 1995
3. Rule (2)(b) -Domestic industry
According toArticle 4.1oftheWTO A-DAgreement, ‘domestic industry 'refers tothedomestic
producers asawhole ofthelikeproducts ortothose ofthemwhose collective output oftheproducts
constitutes amajor proportion ofthetotaldomestic production ofthose products.
Under sub-rule 2(b)oftheCustoms Tariff Rules, ‘domestic industry 'means thedomestic
producers asawhole engaged inthemanufacture ofthelikearticle andanyactivity connected therewith
orthose whose collective output ofthesaidarticle constitutes amajor proportion ofthetotaldomestic
production ofthatarticle.
Question: WhyhasIndia introduced thecondition ‘andanyactivity connected therewith 'which
isnotprovided forintheWTO A-DAgreement? CanIndia givesome examples on
thepossible activities involved?
Answer: Theintentionistocoverdomesticproducersasawholeoflikeproductswhetherengaged
inmanufacture oranyactivity connected therewith.
4. Rule 5-Initiation ofinvestigation
Article5.2oftheWTOA-DAgreementstatesthatanapplicationforananti-dumpinginvestigation
shallinclude evidence ofdumping, injury andacausal linkbetween thedumped imports andthealleged
injury. Simple assertion, unsubstantiated byrelevant evidence, cannot beconsidered sufficient tomeet
therequirements. Paragraphs (i)to(iv)setsoutthespecific information which mustbeincluded in
anapplication forananti-dumping investigation.G/ADP/W/292
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Sub-rule 5(2)oftheCustoms Tariff Rules states thatanapplication shall beintheformas
maybespecified bythedesignated authority.
Question: Would therequirements under Article 5.2(i)to(iv)oftheWTO A-DAgreement be
observed? What administrative orstatutory means havebeenputinplace toensure
compliance?
Answer: Yes,India hasdevised aquestionnaire forfiling anti-dumping petitions which takes
careoftherequirements under Article 5.2oftheWTO Agreement.
5. Rule 6(8)-Principles governing investigations
Sub-rule 6(8)states thatwhere aninterested party refuses access to,orotherwise doesnot
provide necessary information within areasonable period, orsignificantly impedes theinvestigation,
thedesignated authority mayrecord itsfindings onthebasis ofthefactsavailable toitandmake such
recommendations totheCentral Government asitdeems fit.
Question: Ontheimplementationofthisrule,wouldtheIndianauthoritiesobservetherequirements
governing theuseofBIAasprovided forinAnnex IIoftheWTO A-DAgreement?
What legislative oradministrative measures have been putinplace toensure
compliance?
Answer: Thedesignated authority mayconsider relevancy ofrequirements governing theuse
ofBestAvailable Information asprovided forinAnnexure IIoftheAgreement in
recommending itsfindings onthebasis ofthefactsavailable toit.
6. Rule 9-Investigation intheterritory ofother specified countries
Rule9provides thatthedesignated authority maycarry outinvestigation intheterritories of
other countries ifthecircumstances ofacasesowarrant.
Question: Ontheimplementationoftherule,wouldtheIndianauthoritiesobservetherequirements
governing on-site verification asprovided forinAnnex IoftheWTO A-DAgreement?
What legislative oradministrative measures have been putinplace toensure
compliance?
Answer: Thedesignated authority mayconsider relevancy oftheprovisions ofAnnexure Iof
theAgreement incarrying outinvestigations intheterritories ofother countries.
7. Rule 10-Determination ofnormal value, export price anddumping margin
Rule10requires theIndian authorities todetermine thenormal value, export priceanddumping
margin "taking intoaccount", interalia,the"principles" laiddown inAnnexure I.
Annexure Isubstantially reproduces therelevant provisions oftheWTO A-DAgreement.
Question: What istheIndian authorities 'interpretation oftheterms "taking intoaccount" and
"principles"? Does thelegislation oblige Indian authorities toabide byandactin
accordance withtheprovisions inAnnexure Iorleave ittothediscretion ofthe
authorities aslongastheyhavetaken theprovisions intoaccount inthedetermination?G/ADP/W/292
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Answer: Thedesignated authority shall, interalia,takeintoconsideration alltheprinciples (1-6)
ofAnnexure ItotheAnti-Dumping Rules while determining normal value, export price
andthemargin ofdumping.
8. Rule 11-Determination ofinjury
Rule11requires theIndian authorities todetermine injury "inaccordance with" the"principles"
laiddown inAnnexure II,among other things. Annexure IIrequires theIndian authorities to"take
the[...]principles under consideration".
Annexure IIsubstantially reproduces therelevant provisions oftheWTO A-DAgreement.
Question: What istheIndian authorities 'interpretation oftheterm"take the[...]principles under
consideration" and"principles"? Doesthelegislation oblige Indian authorities toabide
byandactinaccordance withtheprovisions inAnnexure IIorleave ittothediscretion
oftheauthorities aslongastheyhave taken theprovisions intoaccount inthe
determination?
Answer: Thedesignated authority shall, interalia,takeintoconsideration alltheprinciples
[(i)-(vii)] ofAnnexure IItotheAnti-Dumping Rules while determining injury.
9. Annexure I,paragraph 6(iv)-Averaging
Article 2.4.2 oftheWTO A-DAgreement provides thatdumping margins shall normally be
determined byeither: (a)comparison ofaweighted average normal value withaweighted average
ofprices ofallcomparable export transactions; or(b)comparison ofnormal value andexport prices
onatransaction totransaction basis.
Inaccordance withparagraph 6(iv)ofAnnexure I,themargin ofdumping shallnormally be
established "onthebasis ofacomparison ofaweighted average normal value andexport prices on
atransaction-to-transaction basis".
Question: Would India clarify howistheprovision consistent withArticle 2.4.2 oftheWTO A-D
Agreement?
Answer: Thereappearstobesometypographicalerrorwhichisbeingconsideredforrectification.
10. Determination ofnormal value -domestic sales
Ondeterminationofnormalvalue,Article2.2oftheWTOA-DAgreementlaysdownthethreshold
forsufficient domestic salestopermit aproper comparison (i.e.domestic salesnotlessthan5percent
ofsales totheimporting country concerned; alower ratioshould alsobeacceptable ifthevolume is
ofsufficient magnitude toprovide foraproper comparison).
IntheIndian legislation, Section 9A(1)(c) oftheCustoms Tariff (Amendment) Act1995 and
rule10&Annexure IoftheCustoms Tariff Rules 1995setoutthedetails forthedetermination ofthe
normal value. Itseems thatthelegislation doesnotprovide forthethreshold forsufficient domestic
sales forthepurpose ofdetermining thenormal value.G/ADP/W/292
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Question: Would theIndian authorities observe therequirement onsufficient domestic sales as
provided forinArticle 2.2andfootnote 2oftheWTO A-DAgreement? What measures,
legislative orotherwise, havebeenputinplace toensure compliance?
Answer: Section 9A(1)(c)(ii) mentions "lowvolume ofthesales". Theintention istoobserve
thethreshold requirements ofArticle 2.2andfootnote 2oftheAnti-Dumping
Agreement.