RESTRICTED
WORLD TRADE G/ADP/W/9
G/SCM/W/17
ORGANIZATION 10July1995
(95-1911)
Original: English Committee onAntidumping Practices
Committee onSubsidies andCountervailing Measures
QUESTIONS CONCERNING THE NOTIFICATIONS PROVIDED
BYTHE GOVERNMENT OFAUSTRALIA OFLAWS AND REGULATIONS
UNDER ARTICLES 18.5AND 32.6OFTHE AGREEMENTS
Thefollowing communication, dated 3July1995, hasbeen received from thePermanent
Delegation oftheEuropean Community.
_______________
Please findenclosed thewritten questions submitted bytheEuropean Community inviewof
thelegislation review tobecarried outinthenextmeeting oftheAnti-Dumping andSubsidies and
Countervailing Measures Committees.
WithregardtoAustralia'santi-dumpingandcountervailinglegislation,notifiedon29March1995
under Articles 18.5 and32.6 oftheWTO Anti-Dumping andSubsidies Agreement (Documents
G/ADP/N/1/AUS/1-G/SCM/N/1/AUS/1), theEuropean Community hasthefollowing questions:
I. Anti-Dumping
1. Section 269TAA(2) -Arm'slength transactions
Section 269TAA(2) defines, interalia,thatatransaction between anexporter andtheAustralian
importer isnotanarm'slength transaction, iftheimporter isreselling thegoods inquestion ataloss.
Insuchacase, theexport price hastobeconstructed pursuant toSection 269TAB(1)(b), regardless
whether there isanassociation oracompensatory agreement between theimporter andtheexporter
ornot.
HowwilltheAustralian authorities ensure thattheirpractice inthisrespect isnotinconflict
withArticle 2.3oftheGATT Anti-Dumping Agreement 1994, which doesnotpermit theuseofa
reconstructed export price merely ontheground thattheimporter hasresold thegoods inquestion
ataloss.
2. Section 269TAAD -Sales made intheordinary course oftrade
Contrary totherelevant provisions oftheGATT A-D Code (c.f.FN4oftheGATT
Anti-Dumping Agreement 1994), Australian Anti-Dumping lawdoesappear tocontain adefinition
astowhatamounts toan"extended period oftime" forthepurpose ofdetermining domestic salesnot
having beenmade intheordinary course oftrade. How willcompliance withtherelevant GATT
provision beensured?G/ADP/W/9
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3. Adjustments inorder toensure afaircomparison ofnormal value andexport prices
TheAustralian Anti-Dumping lawdoesnotappear tocontain comprehensive provisions which
provide forthenecessary adjustments inorder toensure afaircomparison ofnormal value andexport
prices (c.f.Article 2.4oftheGATT Anti-Dumping Agreement 1994). Could itbeexplained ifand
onwhatbasisadjustments asregards, forexample, different levels oftrade, packing andfreight, will
bepermitted?
4. Section 269TAF -Currency conversion
Contrary tothefirstsentence ofArticle 2.4.1 oftheGATT Anti-Dumping Agreement 1994,
Section 269TAF(2) doesnotspecify under which circumstances therateofexchange intheforward
saleshallbeused. Howwillitbeensured thattheprovisions ascontained inSection 269TAC(2) will
beapplied inconformity withthestipulations aslaiddown inArticle 2.4.1 oftheGATT Anti-Dumping
Agreement 1994?
5. Section 269TN(3), (4),(4A)-Retrospective notices withregard tomassive dumped imports
Subsections(3),(4)and(4A)ofSection269TNdonotentirelyreflecttheprovisionsascontained
inArticle 10.6(ii) oftheGATT Anti-Dumping Agreement 1994 because thelikelihood of"seriously
undermin[ing] theremedial effect ofthedefinitive anti-dumping dutytobeapplied" isnotaprecondition
fortheimposition ofmeasures envisaged under Section 269TN(3), (4)and(4A). WillAustralian
authorities takeintoconsideration theaforementioned condition when applying Section 269TN (3),
(4)and(4A)?
6. Useofbestinformation available
Thenotified Australian Anti-Dumping lawdoesnotcontain anyexplicit provisions ascontained
inparagraphs 1,2,3,5,6and7ofAnnex IItotheGATT Anti-Dumping Agreement 1994. Could
itbeexplained howthenecessary precautions willbetaken inorder toensure compliance withthese
provisions?
7. Section 269TC(4)(e) -Period during which submissions should besent
Pursuant toSection 269TC(4)(e) "submissions concerning thepublication ofthenotice have
tobesentwithin aperiod ofnotmore than40daysafterthedateoftheinitiation oftheinvestigation.
Should Australia alsousequestionnaires andshould theynotbedispatched intimehowwillitbeensured
thatexporters haveaperiod of37days(c.f.Article 6.1.1 oftheGATT Anti-Dumping Agreement 1994)
inorder toreply?
8. Right tomeetparties withadverse interests
Australian Anti-Dumping lawasnotified doesnotprovide fortherighttomeetparties with
adverse interests (c.f.Article 6.2oftheGATT Anti-Dumping Agreement 1994). HowwillAustralian
authorities ensure thatthisrightisrespected?G/ADP/W/9
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II. Countervailing Duties
A. Custom Act-Section 269TJ(Pages 58-63)
General
Isthereanydifferencebetweentheterm"materialretardation"oftheestablishmentofadomestic
industry, referred toinArticle 15oftheSubsidies Agreement, andtheterm"materially hindered"
usedinthisSection?
Paragraph 1
Would itbepossible foracountervailing dutytobeimposed, eventhough thesubsidy found
during theinvestigation period wasnolonger granted?
Paragraph 2
Does thetypeofsubsidy in2(a)(i) and(ii)havetobethesame? In2(a)(ii), onthebasis of
which criteria willitbedetermined thatthesubsidy "may" bereceived inthefuture?
Paragraph 4
seems toprovide that,where countervailing duties havebeenimposed onAustralian goods
byathird country without anadequate injury investigation being carried out,Australia maytake
countervailing action against subsidized goods imported fromthecountry involved without aninjury
test.
Inthisregard theCommunity asks:
1. Cananysubsidized goods fromthecountry concerned besubject tocountervailing duties under
thisprovision?
2. Isacomplaintrequired,andisaninvestigationcarriedoutbeforemeasuresaretaken,asrequired
byArticle 10oftheSubsidies Agreement?
3. Article 10oftheSubsidies Agreement makes itclear that, asregards WTO Members,
countervailing measures canonlybetaken following apositive determination ofinjury. Inviewof
this,howdoesAustralia consider thatthisprovision complies withtheSubsidies Agreement?
4. What authority doesAustralia havetounilaterally determine thatanother WTO Member has
imposed duties "without regard to,orwithout proper regard to"injury? Should notsuchadetermination
bemade through theWTO dispute settlement mechanism?
Paragraph 5
seems toprovide thatifathird country imposes acountervailing dutyonAustralian goods
tooffset anon-countervailable benefit ("prescribed assistance") which causes injury, Australia may
takesimilar action against goods imported fromthatcountry, withthesame kindofassistance, which
havecaused injury.G/ADP/W/9
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Inthisregard, theCommunity asks:
1. Cananygoodsimportedfromthecountryconcerned,withthebenefitoftheprescribedassistance,
besubject tocountervailing duties?
2. Isacomplaintrequired,andisaninvestigationcarriedoutbeforemeasuresaretaken,asrequired
byArticle 10oftheSubsidies Agreement?
3. Paragraph 7makes itclearthatprescribed assistance isnotcountervailable. Therefore, inview
oftheprovisions ofArticle 10andArticle 1oftheSubsidies Agreement, under which CVD action
canonlybetaken against countervailable subsidies, howdoesAustralia consider thattheimposition
ofcountervailing duties withregard toprescribed assistance isincompliance withtheSubsidies
Agreement?
4. What authority doesAustralia havetounilaterally determine thatanother WTO Member has
countervailed prescribed assistance (i.e.anon-countervailable benefit)? Should notsuchadetermination
bemade through theWTO dispute settlement mechanism?
Paragraph 6
Thisseems tobeacombination of(4)and(5)giving Australia thepower tocountervail a
non-countervailable benefit without aninjury test,withregard toimports fromathirdcountry which
hasacted inasimilar way.
Inthisregard, thesame questions withregard toparagraphs (4)and(5)areapplicable.
Paragraph 8
Whohastheobligation tofurnish information?
B. LikeProduct
Section 269T.C4 (page 15). Inview ofthedefinition oflikeproduct infootnote 46ofthe
Subsidies Agreement andthefactthatArticle 15.1requires injury tobeassessed onlyinrelation to
thedomestic producers ofsuchproducts, howdoesAustralia justify theprovision including raw
agricultural goods inthedomestic industry producing processed products?
C. Benefit
InSection 269TACC.(7) (page 30)doesa"particular financial contribution orformofincome
orprice support" exclude those examples referred toinSub-sections (2)-(6)?
D. Sampling
InSection 269TACC.(8) (page 30):
1. Atwhatstage issampling carried out?
2. How andwhen areinterested parties informed?G/ADP/W/9
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3. What method istobeusedforcalculating thesubsidy amount forexporters notselected for
sampling?
E. Cumulation ofimports
InSection 269TAE.(2C) (page 34),whyisnoconsideration given totheprovisions of
Article 15.3(a) oftheSubsidies Agreement?
F. Lack ofimports
InSection 269TB.(1) (page 37),itseems thatacomplaint maybelodged evenifimports are
only"likely to"or"may be"imported toAustralia. Intheabsence ofactual imports, howcanthe
criteria for"sufficient evidence" ofinjury andcausality (Article 11.2oftheSubsidies Agreement) be
met?
G. Provisional measures
1. InSection 269TC.(4) (page 42),isitclearthatprovisional measures cannot taken untilatleast
60daysfrom initiation?
2. InSection 269TD.(3) (page 43)doestheinvestigation continue ifthereisanegative preliminary
finding?
H. Negligible subsidy
InSection 269TDA.(2)(a)(ii) (page 48),whyisaweighted-average subsidy amount forthe
investigation period notused?
I. Reasonable examination period
InSection 269TDA.(17) (page 50),whymaythereasonable examination period differ from
theinvestigation period withregard totheassessment ofimport volumes?
J. Retroactivity
InSection 269TN.(5)(b) (page 69),retroactive measures arepermitted where
"...material injury hasbeencaused toanAustralian industry bytheexport toAustralia during
ashort period oflarge quantities ofgoods ..."
Article 20.5oftheSubsidies Agreement refers to"...injury which isdifficult torepair ...
caused bymassive imports inarelatively short period ..."
CanAustralia explain thereasons forthedifferent language inthetwoprovisions, andwhy
itscriteria areapparently lessrigorous thanthose oftheAgreement?
K. Public notice
InSection 269Z1.(4)(d) (page 87),whydoessuchprovisional notice notrequire anexplanation
of"thebasisonwhich theexistence ofasubsidy hasbeendetermined". (Article 22.4(iii) oftheSubsidies
Agreement).