RESTRICTED
WORLD TRADE G/ADP/W/31
G/SCM/W/38
ORGANIZATION 12July1995
(95-1961)
Original: English Committee onAnti-Dumping Practices
Committee onSubsidies andCountervailing Measures
QUESTIONS CONCERNINGTHE NOTIFICATIONS PROVIDED
BYTHE GOVERNMENT OFAUSTRALIA OFLAWS AND
REGULATIONS UNDER ARTICLES 18.5AND 32.6THE AGREEMENTS
Thefollowing communication, dated 7July,hasbeenreceived fromtheHong Kong Economic
andTrade Office.
_______________
Myauthorities haveasked metoforward toyouthequestions andcomments onAustralian
A-Dlawsandregulations forthepurpose oftheSpecial Joint A-DandSCM Committees meeting
scheduled fortheweek of17Julyforcirculation toallMembers.
Customs Act1901
PartXVB --Special Provisions Relating toAnti-Dumping Duties
1. Section 269TAAD -Ordinary Course oftrade
Forthepurpose ofdetermining whether salesbelow costsaremade within anextended period
oftimeinsubstantial quantities, footnote 4toArticle 2.2.1 oftheWTO A-DAgreement provides that
theextended period oftimeshould normally beoneyearbutshallinnocasebelessthansixmonths.
Sec.269TAAD (p.19) doesnotdefine "extended period oftime."
Comment :Itisnotclearifthe"extended period oftime" isdefined elsewhere. Alackofdefinition
mayleadtounnecessary discretion byAustralian authorities. Thiskindofuncertainty
should beavoided, given theexplicit guidelines intheWTO A-DAgreement.
Question : OnwhatbasiswouldtheAustralianAuthoritiesdeterminethe"extendedperiodoftime"?
What istherelevant statutory provision?
2. Sec.269TAAD.(1) -Sales below cost
Within anextended period oftime, footnote 5toArticle 2.2.1 oftheWTO A-DAgreement
provides thatsales below perunitcosts aremade insubstantial quantities when thevolume ofsuch
sales represents notlessthan20percentofthevolume soldintransactions under consideration
forthedetermination ofthenormal value.G/ADP/W/31
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Sec.269TAAD.(1)(p.19)providesthatsalesbelowcostsaretakentohaveoccurredinsubstantial
quantities during anextended period ifthevolume ofsuchsalesoverthatperiod isnotlessthan20per
centofthetotalvolume ofsalesoverthatperiod .
Comment :TheAustralian legislation should notprovide fordifferent reference period fromthat
provided forintheWTO A-DAgreement. Theapparently undefined "extended period
oftime" mayallow Australian authorities tomanipulate inawaytofindsufficient sales
below costs.
Question : WhydoestheAustralian legislation notprovide forareference period asthatprovided
forintheWTO A-DAgreement?
3. Sec.269TAAD.(4) -Establishment ofNormal Value
Inproviding forthenormal value, Article 2oftheWTO A-DAgreement generally makes
reference tothecostoftheproduct perseomitting reference todetermination byauthorities.
Sec.269TAAD.(4) (p.19) refers tothecosts ofgoods "determined bytheMinister".
Comment :TheAustralian legislation introduces anelement ofsubjectivity anddiscretion in
calculating thenormal value.
Questions :IftheMinister determines thecosts ofgoods inafactually wrong manner, though in
good faith, would there beremedies provided bythelegislation toparties affected?
Ifnot,howwould theAustralian legislation implement theobligation under theWTO
A-DAgreement?
4. Sec.269TAAD -Arms length transactions
TheWTO A-DAgreement makes noreference to"arms length transactions" insetting out
thecircumstances forordinary course oftrade inArticle 2.2. Sec.269TAAD (p.19) introduces the
requirement of"arms length transactions" asdefined inSec.269TAA.
Comment :Thereason forsuchanadditional requirement isnotapparent.
Question : WhydoestheAustralian legislation include sucharequirement notprovided forin
theWTO A-Drequirement?
5. BestInformation Available
Sec.269TAB (3) - Export Price
Sec.269TAC (6) - Normal Value
Customs Regulations
Reg. 180(6) - Determination ofCosts
Reg. 181(4) - Determination ofCosts andProfits
Article6.8oftheWTOA-DAgreementprovidesthatwhenanyinterestedpartydoesnotprovide
necessary information, determination maybemade onthebasis ofthefactsavailable. Inthiscase,
theauthorities must observe thedetailed procedures setoutinAnnex II.Inascertaining theexport
price, Sec.269TAB.(3) (p.22) provides thatwhere theMinister issatisfied thatsufficient information
hadnotbeenfurnished, orisnotavailable, toenable theexport priceofgoods tobeascertained under
thepreceding subsections, theexport price ofthose goods shallbesuchamount asdetermined bytheG/ADP/W/31
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Minister having regard toallrelevant information. Similar provisions canbefound forthedetermination
ofnormal value, costsandprofits. TheAustralian notified legislation apparently doesnotcontain the
detailed procedures setoutinAnnex IIoftheWTO A-DAgreement.
Comment : Theprovisions, setoutinAnnex IIareimportant procedural safeguards formaking
determinations based onbestinformation available, toensure fairandequitable
determinations intheinterest ofallparties concerned. Tofaithfully implement the
WTO ADAgreement, theAustralian authorities must follow these procedures. If
theAustralian legislation doesnotcontain theseprovisions, theAustralian authorities
would haveawidediscretion notsubject toprocedural scrutiny.
Questions : DoestheAustralian legislation contains necessary provisions toimplement Annex II?
Ifnot,howwould Australia implement itsobligations under Article 6.8andAnnex II
oftheWTO A-DAgreement?
6. Sec.269TAB.(2)(c) -Export price
Toensure afaircomparison, Article 2.4provides forallowance forprofit accruing incase
theexport price isconstructed under Article 2.3.
InSec.269TAB.(2) (p.22), oneoftheprescribed deductions intheconstruction ofexport price
istheprofit onthesalebytheimporter. Itprovides alternatively thattheMinister may,ifhesodirects,
specify theratebywhich theprofit istobecalculated.
Comment: Itisnotclearastohowtheprofit would bearrived atandunder whatsituation would
theMinister choose tospecify arate.
Question: Isthere anyprescribed level ofprofit? TheWTO A-DAgreement contains new
guidelines onhowtodetermine therateofprofit forconstructed normal value (e.g.
actual databeused). Does thedetermination oftheprofit intheexport price follow
similar guidelines forconstructed normal value? Under whatcircumstances andby
whatcriteria willtheMinister specify therate? Howwould theAustralian legislation
ensuresuchaspecificationwouldmeettherequirementofafaircomparisonasrequired
bytheWTO A-DAgreement?
7. Sec.269TAC.(2)(a)(i) -Insufficient domestic sales
Footnote 2toArticle 2.1provides thatsalesofthelikeproduct intheexporting country shall
normally beconsidered asufficient quantity forthedetermination ofthenormal value ifsuchsales
constitutes 5percentormore ofthesalesoftheproduct under consideration totheimporting Member,
provided thatalower ratiocould beacceptable given adequate evidence. Sec.269TAC (p.22) provides
fornoelaboration onwhatwould constitute alowvolume ofsalesreferred toinsubsection (2)(a)(i).
Comment : Itisnotclear whether theguidelines hasbeen implemented inother partofthe
Australian legislation. Where theWTO A-DAgreement haslaiddown specific
guidelines, theAustralian authorities should berequired bylegislation tofollow the
guidelines.ThisshouldnotbelefttothediscretionoftheAustralianauthoritieswithout
anystatutory provisions.G/ADP/W/31
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Questions : Onwhat basis would theAustralian authorities determine what isa"low volume"
ofsales?HowwouldAustraliaimplementitsobligationunderfootnote2inArticle2.1
toprovide foraguideline on"low volume"?
8. Section 269TAC.(4)(c)-(f) -Normal value ofgoods incaseofgovernment influence
Article18.1oftheWTOA-DAgreementprohibitscountriesfromtakingactionagainstdumping
ofexports byaMember except inaccordance withtheprovisions oftheAgreement. TheWTO A-D
Agreementdoesnotdrawadistinctionbetweenmarketandnonmarketeconomiesandcontainsnoseparate
provisions applicable tononmarket economies only.
Sec.269TAC however provides forspecial procedures fortheestablishment ofthenormal
value ofaproduct exported fromanonmarket economy. Suchprovisions arenotfound intheWTO
A-DAgreement. Notably, subsection (4)(f) provides thatthenormal value established foranonmarket
economy canbebased ontheprice payable forlikegoods produced ormanufactured inAustralia.
TheWTO A-DAgreement provides fornosuchmethod inestablishing thenormal value.
Comment : Sec.269TAC allows Australia totakeanti-dumping action inrespect ofanonmarket
economy Member notinaccordance withtheprovisions oftheWTO A-DAgreement.
Itistherefore aviolation ofArticle 18.1.
Question : What explanations canbeprovided forallowing Australia totakeanti-dumping action
inrespect ofanonmarket economy Member notinaccordance withtheprovisions
oftheWTO A-DAgreement ,incontravention ofArticle 18.1?
9. Sec.269TAC.(9) -Faircomparison
Article 2.4provides thatafaircomparison shallbemade between theexport price andthe
normal value andthatthecomparison shallbemade atthesameleveloftrade, normally attheex-factory
level, andinrespect ofsalesmade atasnearly aspossible thesametime. Italsosetsoutalistoffactors
which affect price comparability forwhich dueallowance shallbemade.
Sec.269TAC.(9)(p.25)requirestheMinistertomake,indeterminingthecosts,suchadjustments
asarenecessary toensure thatthenormal value soascertained isproperly comparable withtheexport
price ofthose goods.
Comment : Thenecessary adjustments asrequired bytheAustralian legislation aretoensure that
thenormal value ascertained inproperly comparable withtheexport price. The
objective given intheWTO A-DAgreement isoverriding -forafaircomparison
andmore concrete -atthesame leveloftrade, normally attheex-factory level, and
inrespect ofsales made atthesame time. TheAustralian legislation alsofailsto
provide specific factors forwhich dueallowance shallbemade, despite theprovision
ofsuchfactors intheWTO A-DAgreement. Thisresults intheAustralian authorities
notgiven sufficient directions inmaking adjustments.
Questions : WhydoestheAustralian legislation notprovide forspecific directions fortheMinister
tomake necessary adjustments tothecosts, assetoutintheWTO A-DAgreement?
Intheabsence ofdetailed statutory provisions, howwould theAustralian authorities
honour theirobligations under Article 2.4toensure afaircomparison andmake due
allowance?G/ADP/W/31
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10. Sec.269TAC.(13) -Profit intheestablishment ofnormal value
When thesales ofproducts intheexporting market donotpermit aproper comparison,
Article 2.2provides forcomparison with thecostofproduction plusareasonable amount for
administrative, selling andgeneral costs andforprofits.
Sec.269TAC.(13) (p.25) provides thattheMinister shallnotinclude thecalculation ofthe
normal value anyprofit component incasethecalculation ismade necessary bydisregarding substantial
salesbelow costs treated asnotbeing intheordinary course oftrade byreason ofprice.
Comment : Innocircumstances doestheWTO A-DAgreement allow exclusion oftheprofit
component. Suchanexclusion would suppress thenormal value andmake afinding
ofdumping more easy.
Questions : WhydoestheAustralian legislation provide forsuchanexclusion ofprofit component
incalculatingthenormalvalue?Whatexplanationscanbeprovidedforsuchaviolation
oftheWTO A-DAgreement?
11. Sec.269TACB.(1) -Existence ofdumping
Article 2.4setsouttheoverriding requirement thatafaircomparison shallbemade between
theexport priceandthenormal value. Itappears thattheAustralian legislation hasinnowhere provide
fororstress thisrequirement ofafaircomparison.
Comment : Theabsence ofanyexpress statutory provisions implementing thisfaircomparison
requirement maywaterdown obligation oftheAustralian authorities when making
acomparison.
Question : HowwouldAustraliaensureitsauthoritieswouldmakeafaircomparisonofthenormal
value andexport price without providing forsuchastatutory requirement inits
legislation?
12. Sec.269TACB.(2) -Comparison method
Article 2.4.2 provides thatthemargin ofdumping shallnormally beestablished onthebasis
ofacomparison ofaweighted average ofprices ofallcomparable export transactions orbyacomparison
ofnormalvalueandexportpriceonatransaction-to-transactionbasis,subjecttotheprovisionsgoverning
faircomparison inparagraph 4.
Sec.269TACB.(2) (p.26) provides forthree comparison methods apparently onaparwith
oneanother. Thefirsttwoarethose provided forinArticle 2.4.2 while thethirdistoapply thefirst
twotoseparate parts oftheinvestigation period.
Comment : Thethird comparison method apparently hasnotbeenenvisaged intheWTO A-D
Agreement andisnotpermitted. Anycomparison method other thanthatprovided
forinArticle 2.4.2 should notbeaccepted innormal circumstances, treated with
scepticism, andshould notbegiven thesamepreference asnowgiven intheAustralian
legislation. Thecircumstances under which theAustralian authorities would employ
thethirdmethod isnotclear. Thekindofdiscretion given totheAustralian authorities
isnotconducive tothefaithful implementation oftheWTO A-DAgreement byG/ADP/W/31
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Australia. Itappears thattheapplication ofthethird method could produce two
different dumping margins.
Questions : Isthethirdcomparison method given thesamepreference asthefirsttwo?Howwould
Australia reconcile thisthirdmethod withitsobligations under Article 2.4.2? How
wouldAustraliaensurethatitsauthoritieswouldemploythepropercomparisonmethod
asrequired byArticle 2.4.2? Under what circumstances would theAustralian
authorities usethethirdmethods ofcomparison? Howwould twodifferent dumping
margins resulting from suchamethod betreated?
13. Sec.269TACB.(8) -Sampling
Art.6.10.1 oftheWTO Agreement stipulates thatwhen sampling isusedintheselection of
exporters, producers, importers ortypes ofproduct, theyshould preferably beconsulted withandtheir
consent isrequired. Itappears thatthere isnosuchaprovision intheAustralian legislation (p.28).
Question: AretheAustralians going tofollow Article 6.10.1 when sampling istobeusedfor
theinvestigation? Ifyes,would legislative provisions beputinplace togiveguidance
totheAustralian authorities?
14. Section 269TAD -Re-establishing certain normal values
IntheSection (p.31), itisstated thattheMinister may, atanytime, andfrom timetotime,
iftheMinister isoftheopinion thatanyfactor relevant totheascertainment ofthenormal value
ofgoods ...hasaltered ,reascertain thatnormal value. TheMinister mayalsochoose nottopublish
suchchangesifthepublicationwouldadverselyaffectthebusinessorcommercialinterestsofanyperson.
Itappears thatthelegislation doesnotprovide foropportunities foraffected parties tobenotified, to
haveaccess torelevant information, andtomake representations forthedefence oftheirinterests.
TheWTO A-DAgreement contains noprovisions forreestablishing thenormal value under
suchcircumstances.Regardingananti-dumpingproceeding,itcontainsdetailedpreceduralrequirements
onopportunities forinterested parties tobenotified (Articles 6.9,12.1), tohaveaccess toinformation
(Articles 6.1.3, 6.4)andtomake representations (Articles 6.1,6.2). Italsorequire theauthorities
tohavedueregard totheaccuracy andadequacy ofevidence (Articles 5.3,6.6).
Comment : Thesection hasnoplace intheWTO A-DAgreement andissubject toarbitrary
application bytheAustralian authorities. Itsuggests thepossibility thatnosubstantial
evidence would berequired tosupport thechange ofanyrelevant factor, despite the
importance oftheaccuracy andadequacy ofevidence stressed intheWTO A-D
Agreement. Theadsence ofanyprocedural safeguards asrequired bytheWTO A-D
Agreement alsomakes theporvisions vulnerable toabuse bytheAustralian authorities,
through thereascertaining ofnormal value, toinflate normal value andsubsequently,
thedumping margin.
Questions: WhydoesAustralia putinplace suchaprovision forthereestablishment ofthenormal
value which isnotprovided forintheWTO A-DAgreement? HowdoesAustralia
reconcile thisprovision withitsobligations under Article 18.1oftheWTO A-D
Agreement nottotakeaction against dumping ofexports byaMember except in
accordance withtheprovisions oftheAgreement? How canAustralia know and
confirm thatthefactor relevant totheascertainment ofthenormal value ofgoods
hasbeenaltered, given thatchanges ofthefactors affecting normal value, suchasG/ADP/W/31
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costofproduction andprofits etc.,aremainly arising fromtheexporter side,instead
ofoccurring intheimporting country? Howwould theAustralian authorities satisfy
themselves astotheevidential basis intheabsence ofconcrete statutory guidelines?
Howwould interested parties begiven theopportunities tobenotified oftheintended
changes, tohaveaccess torelevant information, andtomake representations forthe
defence oftheir interests? How would Australia reconcile thelackofprocedual
safeguards withitsobligations under therelevant provisions oftheWTO A-D
Agreement providing for opportunities forinterested parties tobenotified
(Articles 6.9,12.1), tohaveaccess toinformation (Articles 6.1.3, 6.4)andtomake
representations (Articles 6.1,6.2)?
15. Sec.269TAE.(1) -Factors fordetermining injury
Article3.1providesthatadeterminationofinjuryshallbebasedonpositiveevidenceandinvolve
anobjective examination ofboth(a)thevolumes ofdumped imports andtheireffect onprices inthe
domestic market and(b)theconsequent impact ondomestic producers. Article 3.2provides thatthe
authorities "shall"consider whether there "hasbeen"asignificant increase indumped imports and
"shall"consider whether there "hasbeen"asignificant price undercutting ordepression effect. In
thedetermination ofathreat ofmaterial injury, Article 3.7provides thatthechange incircumstances
must beclearly foreseen andimminent.
Sec.269TAE.(1) (p.31) listsoutthefactors which theMinister "may" have regard toin
determining whether material injury hasbeencaused oristhreatened orwould havebeencaused because
ofcircumstances inrelation tothe"exportation ofgoods" toAustralia. Reference tofactors includes
reference tocircumstances "likely to"happen.
Comment : TheWTO A-DAgreement obliges theauthorities toconsider certain factors inthe
determination ofinjury. TheAustralian legislation onlyprovides thattheauthorities
"may" haveregard tosuchfactors. Itisnotclearwhether theauthorities aretherefore
given thediscretion toignore thefactors. TheWTO A-DAgreement alsodoesnot
provide forconsideration ofeffects thatarelikely tohappen, except perhaps whether
theyconstitute foreseeable andimminent change incircumstances forthedetermination
ofathreat ofinjury. Itisnotclear whether theAustralian legislation allows a
determination ofinjury, instead ofathreat, purely based oneffects thatare"likely
to"happen. Lastly, thereference totheeffects aremade to"theexportation ofgoods
ofthatkindtoAustralia from thecountry ofexport", instead oftheexportation of
the"dumped" goods.
Questions : DoestheAustralianlegislationobligetheAustralianauthoritiestoconsiderthosefactors
aslisted inSec.269TAE.(1)(aa) to(h)?Ifnot,howwould Australia reconcile this
withitsobligations under Article 3.1and3.2?Does theAustralian legislation allow
adetermination ofinjury purely based oneffects thatarelikely tohappen? Ifso,
howwould Australia reconcile thiswithitsobligations under Article 3.2? Does the
omissionofreferenceto"dumped"goodsinthephrase"exportationofgoods"extricate
theAustralian authorities fromtheobligation todetermine injury caused bydumped
imports onlythrough theeffects ofdumping? Doesn 'ttheAustralian lawfailtostress
margin analysis astheWTO A-DAgreement requires?G/ADP/W/31
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16. Sec.269TAE.(2B) -Threat ofmaterial injury
Article 3.7oftheWTO A-DAgreement provides foranillustrative listoffactors tobe
considered indetermining whether athreat ofmaterial injury exists. Suchfactors, interalia,
arethechangeofimportsvolume,productioncapacity,priceundercuttingeffectsandtheamount
ofinventories inhand.
Section 269TAE.(2B) (p.34) states that,forthepurpose ofsusscetion (1),theMinister must
takeaccount onlyofsuchchanges incircumstances, including changes ofakinddetermined bythe
Minister, aswould make thatinjury foreseeable andimminent. Nospecific factors havebeenmentioned.
Comment : InthiscasethattheWTO A-DAgreement hasprovided forelaborate requirements
onthedetermination ofathreat ofmaterial injury, itisconducive tofaithful
implementation oftheAgreement inthedomestic lawfortheAustralian legislation
toprovide forsuchrequirements inorder thattheAustralian authorities canhave
concrete rules tofollow inmaking thedetermination. Intheabsence ofsuch
requirements intheAustralian legislation, theAustralian authotities aredeprived of
thebenefits ofguidance readily available. Moreover, thephrase "changes ofakind
determined bytheMinister" introduce anunnecessary subjective element notprovided
forintheWTO A-DAgreement andnotsubject todetailed procedural safeguards
provided forintheWTO A-DAgreement. Itisnotclear which factors would be
considered bytheMinister aswould make thatinjury foreseeable andimminent.
Question : Would Australia explain thelegislative intentions inincluding "changes ofakind
determined bytheMinister" aschanges thattheMinister isrequired toconsider, in
theabsence ofsuchaninclusion intheWTO A-DAgreement? Would nottheacid
testlaiddown inArticle 3.7,thatthechange incircumstances which would create
asituation inwhich thedumping would cause injury must beclearly forseen and
imminent (andelaborated byanillustrative listfollowing), already provided for
adequate criteria inthedetermination ofathreat ofmaterial injury? Why the
Auistralian legislation notprovide fortheillustrative listinorder thattheauthorities
could havemore concrete rulestofollow asintended bytheWTO A-DAgreement?
17. Sec.269TAE.(2C) -Cumulative assessment oftheimpacts ofimports
Article 3.3oftheWTO A-DAgreement states thatthecumulative assessment oftheeffects
ofdumped imports mayonlybemade ifitisdetermined that
1. dumping margin fromeachcountry ismore thandeminimus andvolume ofimports
from eachcountry isnotnegligible and
2. theconditions ofcompetition between imported products andbetween theimported
products andthelikedomestic products render thecumulative assessment appropriate.
Sec.269TAE.(2C) (p.34) require theMinister tohaveregard toconditions ofcompetition only
foracumulative assessment.
Comment : Inaproceeding involving several exporting countries, some maybeextricated given
demiminis dumping margins ornegligible volume oftheirimports intoAustralia.
Article 3.3oftheWTO A-DAgreement prohibits cumulating theinjurious effect
ofimports from suchcountries withthatofother countries 'imports against whichG/ADP/W/31
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theantidumping proceeding continues. Theabsence ofarequirement ofmore-than-de-
minimis dumping margin andmore-than-negligible volume ofimports indeciding
whether cumulative assessment could bemade violates Article 3.3.
Question : IstheAustralian authorities prohibited bylegislation fromcumulating theinjurious
effect ofacountry 'sexports withthatofother countries 'imports withdemiminis
dumping margins ornegligible import volume, given therequirement ofArticle 3.3?
Ifprohibited ,what istheoperative statutory provision? Ifnotprohibited, what
explanations canbeprovided forsuchaviolation?
18. Sec.269TAE.(3) -Economic factors tobeconsidered when determining injury
Article 3.4oftheWTO A-DAgreement listsanumber ofrelevant economic factors andindices
tobeconsidered forthedetermination ofinjury, including themagnitude ofthemargin ofdumping,
actual andpotential decline insales, profits etc.andactual andpotential negative effects oncashflow,
inventories etc. Thislistasidentified intheArticle isdeclared tobenotexhaustive.
Sec.269TAE(3)(p.34)providesthat"Areference...totherelevanteconomicfactorsinrelation
toanAustralian industry, ...isareference to:...". Thereference doesnotspecify thedecline and
negative effect oncertain economic factors suchassales, profits, market share, cashflow, employment,
inventories etc.
Comments: ThewaySec.269TAE(3) isdrafted setsouttheeconomic factors inanexhaustive
manner. Theexclusion ofanyother factors thatmight haveabearing onthestate
oftheindustry when assessing theinjury iscontrarty toArticle 3.4oftheWTO A-D
Agreement. Theabsence ofanyemphasis onthedecline andnegative effect ofcertain
economic factors asthatprovided fortheWTO A-DAgreement isnotsatisfactory.
Questions: Why isthelistoftherelevant economic factors anexhaustive one,given the
requirement ofArticle 3.4oftheWTO A-DAgreement thatallrelevant factors should
betaken intoaccount? Whydoestheprovision notemphasise thedecline andnegative
effect ofcertain economic factors asthatprovided fortheWTO A-DAgreement ?
19. Sec.269TB (4)-Information tobeprovided inthecomplaint
Art.5.2oftheWTO A-DAgreement setsouttheinformation tobeincluded intheapplication
forinitiation ofA-Dinvestigation.
Sec269TB(4)(b) requires thattheinformation tobeincluded inanapplication foraction under
theA-DActbesubmitted inanapproved form. However, thedetails oftheform isnotavailable in
thenotified legislation. Sec4Aprovides thattheComptroller approves aformbyinstrument inwriting.
Comment: Thesetting outoftheinformation tobeincluded intheapplication inArticle 5.2is
anintegral partoftheWTO A-DAgreement andprovides forimportant procedural
safeguards against frivolous allegations.
Question: What arethedetails tobeincluded intheapproved form? Does theform include
alltheinformation asrequired inArticle 5.2oftheWTO A-DAgreement? Inthe
absenceofanyappropriatestatutoryprovision,theapprovalofformbytheComptroller
isanexercise ofdiscretion. Howwould Australia ensure thattheComptroller would
follow therequirements ofArticle 5.2when heorsheapproves theform?G/ADP/W/31
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20. Sec.269TB (6)-Definition ofdomestic industry
Article 4.1oftheWTO A-DAgreement defines theterm"domestic industry" asreferring to
thedomestic producers asawhole ofthelikeproducts ortothose ofthem whose collective output
oftheproducts constitutes amajor proportion ofthetotaldomestic production ofthose products.
Exceptions arealsoprovided in(i)and(ii)oftheArticle. Thefirstexception provides forwhen
producers arerelated totheexporters orimporters orarethemselves importers oftheallegedly dumped
product, "domestic industry" maybereferring astotherestoftheproducers. Footnote 11totheArticle
defines whatconditions shallbesatisfied incasetwopersons aredeemed toberelated. Oneofthe
conditions isthatproducers andexporters/importers shallbedeemed toberelated incasetheytogether
directly orindirectly control athird person, provided thatthere aregrounds forbelieving or
suspecting thattheeffect oftherelationship issuchastocause theproducer concerned tobehave
differently from non-related producers .
Sec.269TB.(6)(p.39)issilentabouttheexceptions.Thedefinitionoftherelationship,however,
appears tobelocated inSec.269TAA.(4). Nevertheless, thecondition fortheproof ofadifferent
behaviour caused bytherelationship isomitted in(4)(b)(ii).
Comment : Even producers andexporters/importers together control athird person, thisdoes
notnecessarilymeanthatsuchrelationshipwouldmaketheproducerbehavesdifferently
from other non-related producers. Thisloosening ofthecondition makes iteasier
toexclude theirtransactions frombeing anarmslength transaction andthusnotbeing
treated asintheordinary course oftrade.
Question : Doesthedefinition provided for2persons tobeassociates inSec.269TB.(4) resemble
thatreferred infootnote 11toArticle 4.1(i)? Ifyes,whydoesAustralia omitthe
need fortheproof thattheeffect oftherelationship between producers and
exporters/importerswouldcauseproducerstobehavedifferentlyfromothernon-related
producers when producers andexporters/importers together control thethirdperson?
21. Sec.269TC -Initiation ofaninvestigation
Article 5.2oftheWTO A-DAgreement requires greater substantiation intheinitiation ofan
investigation as"simple assertion, unsubstantiated byrelevant evidence, cannot beconsidered sufficient
tomeettherequirements" ofinitiation. Article 5.3provides foranrequirement thattheauthorities
shallexamine theaccuracy andadequacy oftheevidence.
Sec.269TC(1) and(2)(p.40) requires theMinister toexamine theapplication andallows the
Minister toinitiate aninvestigation where there"appear tobereasonable grounds" forthepublication
ofadumping dutynotice.
Comment: Sec269TCfailstostress therequirement ofaccuracy andadequacy oftheevidence
asrequired intheWTO A-DAgreement. Italsoappears thatitprovides aless
stringent testthanthatintheWTO A-DAgreement fortheauthorities toinitiate an
investigation.
Question: How would Australia ensure thatitsauthorities would examine theaccuracy and
adequacy oftheevidence without anexplicit provision tosuchaneffect asprovided
forintheWTO A-DAgreement? What considerations areregarded asreasonable
grounds forinitiation ofinvestigation? How would Australia ensure that"simple
assertion, unsubstantiated byrelevant evidence" would bedismissed?G/ADP/W/31
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22. Sec.269TJA-Concurrent dumping andsubsidy
Article 18.1oftheWTO A-DAgreement provides thatnospecific action against dumping
canbetaken except inaccordance withtheprovisions ofGATT 1994asinterpreted bytheWTO A-D
Agreement. TheGATT 1994 andWTO A-DAgreement allow animposition ofanti-dumping only
when thedumped imports, through theeffects ofdumping, cause injury tothedomestic industry
(Article 3.5). They donotallow injury caused byacombination ofeffects ofdumping andsubsidy
eveninrespect ofthesame goods.
Sec.269TJA(p.63) allows apublication ofdumping notice when thematerial injury iscaused
bythecombined effect ofdumping andsubsidy inrespect ofthesame goods.
Comment : Thecumulation allowed inSec.269TJAisnotprovided forinGATT 1994 andthe
WTO A-DAgreement. Imposition ofanti-dumping dutybyvirtue ofthisSec.is
therefore aviolation.
Questions : Why doesAustralia allow thecumulation oftheeffect ofdumping andsubsidy in
respect ofthesame goods? Howwould Australia reconcile thiswithitsobligations
under Article 18.1oftheWTO A-DAgreement?
23. Sec.269ZI.(4)(c)(ii) --Information tobeincluded inpublic notice
Article 12.2.1 (iii)oftheWTO A-DAgreement requires thatthepublic notice oftheimposition
ofprovisional measures shallcontain afullexplanation ofthereasons ofthemethodology usedinthe
establishment andcomparison oftheexport price andthenormal value. Regarding theconclusion
ofaninvestigation, Article 12.2.2 requires thepublic notice toinclude theinformation described in
subparagraph inparticular.
Regarding apublic notice ofadecision torequire securities, Sec.269ZI.(4)(c)(ii) (p.83) only
requires theparticulars toinclude anexplanation ofthemethods usedtocompare export prices and
normal values, butnotanexplanation ofthemethods usedtoestablish theexport prices andnormal
value. Regarding apublic notice ofadecision topublish adumping dutynotice, sec269ZI(5) also
doesnotrequire thenotice toinclude anexplanation ofthemethods usedtoestablish theexport prices
andnormal value.
Comment : Itisveryimportant toinclude inthepublic notice anexplanation ofhowthenormal
valueandtheexportpriceareestablishedsothatinterestedpartiesmayfurthercomment
onthemethodology employed andforward theirsubmission fortheconsideration of
theAustralian Authority inthefinaldetermination. Inthecaseofthepublication
ofadumping dutynotice, interested parties mayreqiure theinformation forpreparing
itscaseforjudicial review. Theomission ofsuchanexplanation exploits theinterested
parties 'rights inanA-Dinvestigation.
Question : What statutory provision isinplace torequire apublic notice ofadecision torequire
securities inrespect ofinterim dutypayable, ortopublish adumping dutynotice,
toinclude anexplanation ofthemethodology usedintheestablishment oftheexport
price andthenormal value, asrequired byArticle 12.2.1 (iii)oftheWTO A-D
Agreement?G/ADP/W/31
G/SCM/W/38
Page12
Customs Regulations
24. Regulation 181-Determination ofcosts andprofits (SubSec.s 269TAAD(4) and
269TAC(5B) oftheAct)
Inproviding thebasis onwhich administrative, selling andgeneral costs aredetermined,
Article 2.2.2 generally refers tothe"exporter orproducer" andsalesinthe"domestic market ofthe
country oforigin ".Regulation 181(2) doesnotinclude theproducer. Regulation 181(3) and(5)refers
tosalesinthe"domestic market ofthecountry ofexport ".
Comment : BoththeAustralian legislation andtheWTO A-DAgreement distinguishes between
thecountry oforigin andtheexporting country. Theprovisions oftheAustralian
legislation failtofollow those oftheWTO A-DAgreement. Sec.269TAC(10) might
nothelpbecause itapplies tothefinding ofinjury only.
Question : Why doestheAustralian legislation notfollow theprovisions oftheWTO A-D
Agreement?
WTO A-DAgreement provisions notprovided forintheAustralian ADlegislation
25. Industrial users, representative consumer organizations
Article 6.12provides thattheauthorities shallprovide opportunities forindustrial users ofthe
productunderinvestigation,andforrepresentativeconsumerorganizationstoprovideinformationrelevant
totheinvestigation. Australian legislation notified seemingly doesnotcontain provisions providing
forsuchopportunities.
Comment :Failure toprovide suchopportunities isaviolation ofArticle 6.12.
Question : Would Australia explain whatlegislative provision hasbeenorwould beputinplace
toimplement itsobligations under Article 6.12?
26. Investigations intheterritory oftheother Members
Article 6.7allow theauthorities tocarry outinvestigations inother Members territory for
verification ofinformation purposes. Insuchinvestigations, theprocedures inAnnex Ishallapply.
TheAustralian notified legislation contains noprovisions forinvestigations intheexporting
country orcountry oforigin oftheallegedly dumped goods, orprocedures forinvestigations atall.
Comment :Itisnotclearwhether theAustralian authorities would carry outinvestigations and,
ifyes,whatprocedures would theyfollow.
Questions :Would theAustralian authorities carry outinvestigations inother countries for
information verification purposes? Ifyes,whataretherelevant statutory provisions
governing suchinvestigations andtheprocedures tofollow? How would Australia
ensure thattheprocedures inAnnex Iwould becompiled with?