Training Module on The WTO Agreement on Anti-Dumping - Unctad

163 Pages·2006·0.78 MB·English

UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT

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UNITED NATIONS
New York and Geneva, 2006
TRAINING MODULE ON THE WTO AGREEMENT ON ANTI-DUMPING
NOTE

• The symbols of United Nations documents are composed of capital letters
combined with figures. Mention of such a symbol indicates a reference to a
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• Material in this publication may be freely quoted or reprinted, but
acknowledgement is requested, together with a reference to the document
number. A copy of the publication containing the quotation or reprint should
be sent to the UNCTAD Secretariat at: Palais des Nations, 1211 Geneva 10,
Switzerland.

For further information on the Trade Negotiations
and Commercial Diplomacy Branch and its activities,
please contact:

Ms. Mina MASHAYEKHI
Head, Trade Negotiations and
Commercial Diplomacy Branch
Division of International Trade in Goods and
Services, and Commodities
Tel: [phone]
Fax: [phone]
E-mail: [email protected]
www.unctad.org/tradenegotiations
www.unctad.org/dispute

UNCTAD/DITC/TNCD/2004/6
UNITED NATIONS PUBLICATION
ISSN 1816-5605

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TABLE OF CONTENTS
TABLE OF CONTENTS

ABBREVIATIONS v

ACKNOWLEDGEMENTS vii

INTRODUCTION 1

CHAPTER I: THE ANTI-DUMPING AGREEMENT IN THE WTO:
AN OVERVIEW 3

I.1 INTRODUCTION 3
I.1.1. History 3
I.1.2. Current situation 4
I.1.3. Outline of the ADA 4
I.1.4. Actionable forms of dumping 4
I.1.5. Like product 5
I.1.6. Forms of injury 5
I.1.7. Investigation periods 5

I.2. THE DETERMINATION OF DUMPING 6
I.2.1. Overview of Article 2 6
I.2.2. The export price 7
I.2.3. Normal value 7
I.2.3.a) Standard situation: domestic price 7
I.2.3.b) Alternatives: third country exports or constructed normal value 8
I.2.3.c) Special situations 10
I.2.4. Non-market economy dumping/surrogate country 12
I.2.5. Fair comparison and allowances 12
I.2.6. Comparison methods 13
I.2.7. Simplified calculation examples 15

I.3. THE DETERMINATION OF INJURY 18
I.3.1. Overview of Article 3 18
I.3.2. The notion of ‘dumped imports’ 19
I.3.3. The like product/product line exception 19
I.3.4. The domestic industry 20
I.3.5. Material injury 20
I.3.6. Causation/other known factors 23
I.3.7. Injury margins 24

I.4. THE NATIONAL PROCEDURES 26
I.4.1. Introduction 26
I.4.2. Application 27
I.4.3. Due process rights 29
I.4.4. Provisional measures 32
I.4.5. Price undertakings 32
I.4.6. Anti-dumping duties 33
I.4.7. Retroactivity 34
I.4.8. Reviews 34
I.4.9. Judicial review 35
I.4.10. Flowchart 35
I.4.11. Initiation of anti-dumping investigations at the national level 37
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TRAINING MODULE ON THE WTO AGREEMENT ON ANTI-DUMPING
I.5. THE WTO PROCEDURES 37
I.5.1. Introduction 37
I.5.2. WTO ADA jurisdiction and standard of review 40
I.5.3. Procedural issues 42

I.6. DEVELOPING COUNTRY MEMBERS 44
I.6.1. Article 15 ADA 44
I.6.2. Panel interpretation 45
I.6.3. Constructive remedies 45
I.6.4. Timing 45

I.7. CURRENT NEGOTIATIONS UNDER THE DOHA WORK PROGRAMME 46
I.7.1. The mandate in the Doha Declaration 46
1.7.2. The format and progress of negotiations 48
1.7.3. Main issues and negotiating interests – an overview 49
1.7.4. Specific issues – implementation issues 51
1.7.5. Specific issues – negotiating issues 53

CHAPTER II: DUMPING AND INJURY MARGIN CALCULATIONS METHODS 63

A. PRACTICAL ASPECTS 63

II.1. SUGGESTIONS FOR DEVELOPING COUNTRIES CONSIDERING THE ADOPTION OF
ANTI- DUMPING LEGISLATION 63
II.1.1. Procedural issues 63
II.1.2. Dumping 67
II.1.3. Injury 68
II.1.4. Circumvention 68
II.1.5. Rules of origin 70

II.2. DUMPING MARGIN CALCULATIONS 70
II.2.1. Export price 71
II.2.2. Normal value 71
II.2.3. Adjustments 72
II.2.4. Fair comparison 72
II.2.5. Sales below cost and constructed normal value 73

II.3. INJURY MARGIN CALCULATIONS 74
II.3.1. Price undercutting: price comparison 74
II.3.2. Underselling: target prices 76

B. SAMPLE DUMPING CALCULATIONS 79

TABLE 1: EXPORT SALES 79
TABLE 2: DOMESTIC SALES 87
TABLE 3: COST OF PRODUCTION 95
TABLE 4: ORDINARY COURSE OF TRADE TESTS 103
TABLE 5: DUMPING CALCULATION 107

ANNEXES 111

SUGGESTED READINGS 153
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ABBREVIATIONS
ABBREVIATIONS

AB: Appellate Body
ADA: Anti-Dumping Agreement
ADP: Anti-dumping practices
ASCM: Agreement on Subsidies and Countervailing Measures
ASG: Agreement on Safeguards
CIF: Cost insurance freight
CTV: Color televisions
CVD: Countervailing duties
DITC: Division on International Trade in Goods, and Services and Commodities
DOC: U.S. Department of Commerce
DRAM: Dynamic random access memories
DSU: Dispute Settlement Understanding
FANs: Friends of the Anti-dumping Negotiations
GATT: General Agreement on Tariffs and Trade
GSP: General System of Preferences
HFCS: High fructose corn syrup
HS: Harmonized system
IIP: Injury investigation period
JWT: Journal of World Trade
LDCs: Least developed countries
MEG: Mono ethylene glycol
PSF: Polyester staple fibres
S&D: Special and differential treatment
SG&A: Administrative, selling and general costs
TNCDB: Trade Negotiations and Commercial Diplomacy Branch
TNC: Trade Negotiations Committee
TPKM: the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu
UNCTAD: United Nations Conference on Trade and Development
USDOC: United States Department of Commerce
WTO: World Trade Organization

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vi
ACKNOWLEDGEMENTS
ACKNOWLEDGEMENTS

This training module was prepared by UNCTAD’s Trade Negotiations and Commercial
Diplomacy Branch (TNCDB) under the supervision of Mina Mashayekhi, Head of Branch,
based on work done by Edwin Vermulst and Marius Bordalba, with updates by Elisabeth
Tuerk, Seung Yoon Leem and Antoine Barbry. Sophie Munda was responsible for formatting
and Diego Oyarzun-Reyes designed the cover page.
This training module is for information and training purposes only and does not intend to state
the official position of Member States of the WTO or UNCTAD. It aims to provide training
materials and inputs for developing countries’ trainers, lecturers and government officials
involved in training and research tasks on anti-dumping.

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viii
INTRODUCTION
INTRODUCTION

This module is divided into several parts. The first chapter contains substantive material
related to the Anti-Dumping Agreement (ADA) and current WTO negotiations. The second
chapter gives detailed explanations of the dumping margin calculation, including sample
calculations. Two annexes are attached to the module: one contains a table with the proposals
Members have put forth in current negotiations, the other contains relevant legal texts (e.g.
the WTO Anti-Dumping Agreement).

Chapter I of the module gives an overview of the Anti-Dumping Agreement, including as it
has been interpreted by panels and the Appellate Body over recent years. It reviews both
substantive and procedural rules. Since the entry into force of the ADA in 1995, several WTO
panel reports have been issued interpreting ADA provisions, of which some have been
appealed. While not serving as legal precedents, the panel and the Appellate Body reports can
offer crucial interpretations of key provisions of the Agreement.1 The last section of Chapter I
gives an overview of the anti-dumping negotiations in the context of the Doha Work
Programme.

Chapter II of the module explains the methods of calculating dumping and injury margins on
the basis of practical calculation examples. The objective is to give developing country
Governments and private enterprises a better understanding of the operation of anti-dumping
legislation in practice. It is relatively easy to adopt anti-dumping legislation and, in fact, the
Rules Division of the WTO has developed a model anti-dumping law that could be used for
this purpose. However, it is much more difficult to conduct an anti-dumping investigation and
to make dumping and injury margin calculations in conformity with the WTO rules. The
simplified examples in this module are intended to assist in this process.

While every care has been taken to ensure that the information contained in this handbook is
correct, no claim may be made against the publisher. This document has no legal value.

1 For a detailed review of the ADA's provisions, as they have been interpreted by WTO panels and the Appellate
Body, see Van den Bossche, P, The Law and Policy of the World Trade Organization; Text, Cases and Materials;
Chapter 6; Cambridge University Press 2005.
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