Trade Liberalization versus other Societal Values

and Interests: The WTO Exceptions

 Trade liberalization versus other societal values
and interests
Functions of government as potential NTBs:
– Public health

– Consumer safety

– Environment
– Economic development
– National security
 The WTO exceptions
WTO provides a wide-ranging exceptions to the basic WTO rules, allowing
Members to adopt trade-restrictive legislation and measures that pursue the
promotion and protection of other societal values and interest:
» The ‘general exceptions’ of GATT Art. XX and GATS Art. XIV
» The ‘security exceptions’ of GATT Art. XXI and GATS Art. XIV bis
» The ‘economic emergency exceptions’ of GATT Art. XIX and the
Agreement on Safeguards
» The ‘regional integration exceptions’ of GATT Art. XXIV and GATS
Art. V
» The ‘balance of payments exceptions’ of GATT Art. XII, XVIII:B and
GATS Art. XII
» The ‘economic development exceptions’ of GATT Art. XVIII:A
 Article XX -- General Exceptions (GATT 1994)

Subject to the requirement that such measures are not applied in a manner which would constitute a means
of arbitrary or unjustifiable discrimination between countries where the same conditions prevail, or a
disguised restriction on international trade, nothing in this Agreement shall be construed to prevent the
adoption or enforcement by any contracting party of measures:

. (a) necessary to protect public morals;

. (b) necessary to protect human, animal or plant life or health;

. (c) relating to the importations or exportations of gold or silver;

. (d) necessary to secure compliance with laws or regulations which are not inconsistent with the
provisions of this Agreement, including those relating to customs enforcement, the enforcement of
monopolies operated under paragraph 4 of Article II and Article XVII, the protection of patents, trade
marks and copyrights, and the prevention of deceptive practices;
 Article XX -- General Exceptions (GATT 1994)

(e) relating to the products of prison labour;

(f) imposed for the protection of national treasures of artistic, historic or archaeological value;
(g) relating to the conservation of exhaustible natural resources if such measures are made effective in
conjunction with restrictions on domestic production or consumption;
(h) undertaken in pursuance of obligations under any intergovernmental commodity agreement which
conforms to criteria submitted to the COPAS and not disapproved by them…
(i) involving restrictions on exports of domestic materials necessary to ensure essential quantities of
such materials to a domestic processing industry during periods when the domestic price of such
materials is held below the world price as part of a governmental stabilization plan; Provided that
such restrictions shall not operate to increase the exports of or the protection afforded to such
domestic industry, and shall not depart from the provisions of this Agreement relating to non-
discrimination;....
 Article XX - General Exceptions: Nature and functions

GATT Art. XX:

• provides for a “limited and conditional exception” from

obligations under other provisions

• aims at balancing between trade and other societal values

• may not be used to undermine the WTO multilateral

trading system
Article XX -- General Exceptions: The inconsistency test

US – Gasoline, Panel report

The party invoking an exception has to establish the following elements:
“(1) that the policy in respect of the measures for which the provision was
invoked fell within the range of policies designed to protect human, animal or
plant life or health;
(2) that the inconsistent measures for which the exception was being invoked
were necessary to fulfill the policy objective; and
(3) that the measures were applied in conformity with the requirements of the
introductory clause of Article XX.
Article XX -- General Exceptions: The two-tier test

US—Gasoline, AB report

“In order that the justifying protection of Article XX may be extended to it, the
measure at issue must

» not only come under one or another of the particular exceptions - paragraphs
(a) to (j) - listed under Article XX; it must also

»satisfy the requirements imposed by the opening clauses of Article XX.

The analysis is, in other words, two-tiered: first, provisional justification by

reason of characterization of the measure under XX(g); second, further appraisal
of the same measure under the introductory clauses of Article XX.”
Article XX -- General Exceptions: The first test

Art. XX(b): ‘measures necessary to protect human, animal or plant life or health’

A GATT-inconsistent measure is provisionally justified under GATT XX(b) if:

» the measure is designed to protect life or health of humans, animals or plants

(meaning that the policy objective pursued by the measure is the protection of life
or health); and

» the measure is necessary to fulfill that policy objective.

(US—Gasoline, Panel report)

Article XX -- General Exceptions: The first test -Necessary

Thailand – Cigarettes:

» no alternative measure consistent or less inconsistent could be

reasonably expected to be taken

US Gambling: 

– Comparison between challenged measure and alternatives

– & considered in the light of the interests at issue

Article XX -- General Exceptions: Chapeau test

Subject to the requirement that such measures are not applied in a manner which would constitute
a means of arbitrary or unjustifiable discrimination between countries where the same
conditions prevail, or a disguised restriction on international trade, nothing in this Agreement
shall be construed to prevent the adoption or enforcement by any contracting party of measures:

. (a) necessary to protect public morals;

. (b) necessary to protect human, animal or plant life or health;

. (c) relating to the importations or exportations of gold or silver;

. (d) necessary to secure compliance with laws or regulations which are not inconsistent with the
provisions of this Agreement, including those relating to customs enforcement, the enforcement
of monopolies operated under paragraph 4 of Article II and Article XVII, the protection of
patents, trade marks and copyrights, and the prevention of deceptive practices;
Article XX -- General Exceptions: Chapeau test

Such measures are:


1. not applied in a manner which would constitute a means of arbitrary
discrimination between countries where the same conditions prevail, or

2. not applied in a manner which would constitute a means of
unjustifiable discrimination [between countries where .....] or

3. or a disguised restriction on international trade,
 Regional integration exceptions
» WTO law recognizes the advantages of economic integration
and trade liberalization even when these efforts involve only
some of its Members:
– Article XXIV of the GATT
– Article V of the GATS
– Understanding the Interpretation of Article XXIV of the GATT
1994: “the purpose of [regional trade] agreements should be
to facilitate trade between constituent territories and not to
raise barriers to the trade of other Members with such
territories… in their formation or enlargement the parties to
them should to the greatest possible extent avoid creating
adverse effects on the trade of other Members”.
 Regional Trade Agreements
» Delays in concluding the Doha Round provided an impetus for the
proliferation of RTAs

» A WTO empirical study in 1995 concluded that there was no

tension between the two and they have complemented each other.
E.g: Baldwin - review of the operation of the EEC had had a
positive impact on the global economy
 Regional Trade Agreements
» Trade diversion versus trade creation?

– WTO rules should ensure that regional trade agreements create

trade more than they divert

» RTAs encourage the shifting of resources which could have been

invested in the multilateral trading system

» The world’s poorest countries are likely to be left out

» Developing countries’ perspective: while critical of mega-trading

blocs, they believe that RTAs could prepare them to compete
effectively in the multilateral trading system
Regional Trade Agreements - Motivation

– Efficiency considerations

– Trade Expansion

– Means of attracting FDI

– Political considerations - confidence building

– Easy accession to RTAs and easy administration

– Increased Negotiating Leverage in the WTO and other fora

 Regional Trade Agreements - Types
» Free Trade Areas (most popular)

– Elimination of barriers to trade between parties; each party

maintains its own external tariffs

» Customs Unions

– Elimination of barriers to trade between parties; constituent

members maintain common external tariffs

» Common Market: Free movement of factors production

» Economic Unions
 GATT Article XXIV
Article XXIV:5 of the GATT 1994

Turkey - Textiles, Appellate Body report:

–“[W]e are of the view that Article XXIV may justify a measure which
is inconsistent with certain other GATT provisions. However, in a
case involving the formation of a customs union, this "defence" is
available only when two conditions are fulfilled. First, the party
claiming the benefit of this defence must demonstrate that the
measure at issue is introduced upon the formation of the customs
union that fully meets the requirements of sub-paragraph 8(a) and
5(a) of Article XXIV. And, second, that party must demonstrate
that the formation of the customs union would be prevented if it
were not allowed to introduce the measure at issue”.
GATT Article XXIV - Customs Union

A measure could be justified under GATT Article XXIV:

• If that measure is introduced upon the formation of a
customs union that meets the requirements of Article
XXIV:8(a) and Article XXIV:5(a); and
• if the formation of that customs union would be made
impossible if the introduction of the measure concerned
were not allowed
 GATT Article XXIV:8(a)
(a) A customs union shall be understood to mean the substitution of a
single customs territory for two or more customs territories, so that:

(i) duties and other restrictive regulations of commerce (except, where

necessary, those permitted under Articles XI, XII, XIII, XIV, XV and
XX) are eliminated with respect to substantially all the trade between
the constituent territories of the union or at least with respect to
substantially all the trade in products originating in such territories, and,
(ii) … substantially the same duties and other regulations of commerce
are applied by each of the members of the union to the trade of territories
not included in the union;
 GATT Article XXIV:8(a)
(a) A customs union shall be understood to mean the substitution
of a single customs territory for two or more customs territories, so
that:

(i) duties and other restrictive regulations of commerce (except,

where necessary, those permitted under Articles XI, XII, XIII, XIV,
XV and XX) are eliminated with respect to substantially all the
trade… —> more than some of the trade

(ii) … substantially the same duties and other regulations of

commerce are applied by each of the members of the union to the
trade of territories not included in the union; —> constituent
members apply common external trade regime
 GATT Article XXIV:5(a)
5. Accordingly, the provisions of this Agreement shall not
prevent, as between the territories of contracting parties, the
formation of a customs union or of a free-trade area or the
adoption of an interim agreement necessary for the formation of
a customs union or of a free-trade area; Provided that:

(a) with respect to a customs union … the duties and other

regulations of commerce imposed at the institution of any such
union … shall not on the whole be higher or more restrictive
than the general incidence of the duties and regulations of
commerce applicable in the constituent territories prior to the
formation of such union … as the case may be;
 GATT Article XXIV:5(a)
5.
(a) with respect to a customs union … the duties and other
regulations of commerce imposed at the institution of any such
union … shall not on the whole be higher or more restrictive than
the general incidence of the duties and regulations of commerce
applicable in the constituent territories prior to the formation of such
union … as the case may be;

—> general incidence of the duties applied before and after the
formation of a customs union shall be based upon an overall
assessment of weighted average (applied) tariff rates and of customs
duties collected.
 GATT Article XXIV - FTAs
A measure could be justified under GATT Article XXIV:
• If that measure is introduced upon the formation of a free
trade area that meets the requirements of Article XXIV:8(a)
and Article XXIV:5(a); and
• if the formation of that free trade area would be made
impossible if the introduction of the measure concerned were
not allowed
 GATT Article XXIV:8(b)

(b) A free-trade area shall be understood to mean a group

of two or more customs territories in which the duties and
other restrictive regulations of commerce (except, where
necessary, those permitted under Articles XI, XII, XIII,
XIV, XV and XX) are eliminated on substantially all the
trade between the constituent territories in products
originating in such territories.
 GATT Article XXIV:5(b)
5.
(b) with respect to a free-trade area … the duties and other
regulations of commerce maintained in each of the constituent
territories and applicable at the formation of such free–trade area …
to the trade of contracting parties not included in such area or not
parties to such agreement shall not be higher or more restrictive
than the corresponding duties and other regulations of commerce
existing in the same constituent territories prior to the formation of
the free-trade area…
—> compare conditions before and after the formation of a free
trade area with respect to duties applied by member of a FTA to
trade with third countries
WTO DISPUTE SETTLEMENT SYSTEM
 Object and purpose of WTO DSS
WTO DSS is essential to the effective functioning of the WTO and the
maintenance of a proper balance between the rights and obligations of
Members
• A central element in providing security and predictability to the WTO
multilateral trading system
• A system favoring mutually agreed solutions:
✦ DSU Art 3.7: ‘The aim of the dispute settlement mechanism is to
secure a positive solution to a dispute. A solution mutually acceptable
to the parties to a dispute and consistent with the covered agreement
is clearly to be preferred’
• A rule-oriented system
• A system intended to secure withdrawal of inconsistent measures
• A system intended to settle disputes in good faith
 Jurisdiction of the WTO DSS
• Multilateralism v. unilateralism: to redress a violation of WTO law
through the multilateral DSU procedures, and not through unilateral action
• One integrated system for all WTO disputes:
★
Exclusive application of WTO rules on dispute settlement to disputes
between Members related to the WTO
★
Exclusive and obligatory nature
★
Uniform application to all WTO Agreements
• Jurisdiction of the WTO DSS
✦
Compulsory
✦
Exclusive
✦
Contentious
 Functions of the WTO DSS
• Preserving the rights and obligations of WTO Members
• Clarifying those rights and obligations through interpretation
(Vienna Convention)
• Judicial activism?
 Access to WTO DSS
• Causes of action:
• violation complaints: demonstrate existence of violation and
presumption of nullification or impairment
• non-violation complaints
• situation complaints
• Measures subjects to WTO DSS
• Private action?
• Measures that are no longer in force?
• Legislation as such, independently from its application?
• Who can participate? Only WTO members
 Methods of WTO dispute settlement

A 2-tier and 3-stage mechanism

• Resolution by the parties themselves or resolution by a third party
• Resolution through mutually agreed solution

• Consultations
• Objectives of consultations
• Functions of consultations
• Good offices, conciliation and mediation
• Adjudication

• Implementation
 The Dispute Settlement Body
• The entity overseeing the functioning of the dispute settlement
mechanism
• Decision-making process in the DSB: quasi-automaticity
• Participation in decision-making by the DSB
• Special role of the Chairman of the DSB
 Panels
• Review the facts and arguments submitted by the parties
• Composition of panels: who can be called to serve on a panel?
• Panelist selection process and appointment of panelists
• Legal & Administrative Support by Secretariat
 Appellate Review
• WTO Dispute Settlement System
• Innovations
• Appellate Review
• Applicable Rules to Appellate Review
• Dispute Settlement Understanding 

(Article 17; Article 16.4; Articles 1, 3, 18 and 19)

• Working Procedures for Appellate Review

• Rules of Conduct
 Appellate Body (AB)
• Review on appeal the issues of law addressed by panels

• Composition of the Appellate Body

• Appointment by DSB, Requirements; Term

• Operation of the Appellate Body

• The Appellate Body Secretariat

 Remedies for breach of WTO law
• If Member fails to bring measure into conformity within reasonable period
of time, possibility of temporary measures:
compensation or “suspension of concessions” (retaliation)
• Compensation:
– voluntary
– negotiated
– compatible with WTO obligations
– agreed within 20 days after expiry of reasonable period of time
• Suspension of concessions
– same sector/other sector/other agreement
– level of suspension: “equivalent to the level of nullification or
impairment” (Art. 22.4 DSU)
– authorization: within 30 days of expiry of the reasonable period of
time
S&D for Developing countries and LDCs
• Recognition of the special condition of developing and least-developed
country Members
• Least -developed countries (Art. 24 DSU): particular consideration to special
situation, restraint in asking for compensation and seeking to suspend
concessions
• Legal assistance from Secretariat (Art. 27.2 DSU): Advisory Centre on WTO
Law (ACWL)
• Specific provisions: e.g. composition of panels (Art. 8.10 DSU), consultations
(Art. 4. 10 DSU), panels procedures (Art. 12. 10 and 12.11 DSU) 

- allocation of sufficient time
• Accelerated procedure at the request of a developing country Member
• Good offices, conciliation or mediation by the Chairman of the DSB or the
WTO Director-General
RULES ON MARKET ACCESS
Tariff And Non-Tariff Barriers
 Categories of trade policies

• Internal restrictions, dealt with by Article III of the GATT

• Border measures, dealt with by Articles II and XI of the GATT
❑ Tariffs barriers

❑ Non-tariff barriers
 Purpose and effect of border measures
General and common policy purposes for all types of border
measures:
❑ Curtail imports

❑ Enhance domestic production

❑ Fiscal revenues through the imposition of tariffs

❑ Protection of health, morals, resources, food security

Common effect of border measures:

❑ Reduce the impact of foreign competition in the domestic
market
❑ Raise internal prices for consumers

❑ Reduce the share of domestic production on the world market

 Purpose and effect of border measures
Tariffs are price-based restrictions that take either of the
following forms:
❑ Ad valorem duty (a percentage on the value of the

imported merchandise)
❑ Specific duty (flat charge per unit or by weight, volume or

number, irrespective of the price of the imported good)

❑ Mixed (ad valorem and specific)
 Purpose and effect of border measures
Non-tariff border measures take either of the following forms:
❑ Prohibition of imports and exports
❑Quantitative restrictions on imports (quotas) or exports
(VERs)
❑ Authorization and monitoring
TARIFF BARRIERS TO TRADE IN GOODS

• customs duties or tariffs;

• negotiations on tariff reductions;
• tariff concessions or bindings and Schedules of Concessions;
• protection of tariff concessions;
• modification or withdrawal of tariff concessions;
• the imposition of customs duties; and
• duties and other charges other than customs duties;
 CUSTOMS DUTIES OR TARIFFS

• What is a customs duty?

• Customs duties or tariffs: Do they refer to exactly the same things?
• Differentiate specific, ad valorem, or mixed customs duties
• Why ad valorem customs duties are by far the most common type?
• Purpose of customs duties or tariffs?
❑ Fiscal revenues
❑ Industrial policy instrument
❑ Protection of domestic production from foreign competition
Tariff Classification and the Harmonized System

❑ Tariffs are administered by every country through different national tariff

schedules
❑Standardization of tariff schedules would facilitate the international
exchange of goods
❑The Convention on the Harmonized Commodity Description and
Coding System (HS) of 1983
❑ The Harmonized System is used by over 177 countries
❑ The Harmonized System is the basis of GATT/WTO tariff schedules
❑ Obligations under the HS Convention
❑ Over 98% of international trade concerns products classified under the
terms of the Harmonized System
WTO/GATT framework on tariff barriers
❑ No outright prohibition on tariffs
❑ No set limit to the size of tariffs
❑ Framework for multilateral negotiations: GATT Art. XXVIII
❑ Article XXVIII bis: tariff reduction is to be achieved through
concessions made on a reciprocal and mutually advantageous
basis
❑ GATT tariff “rounds”
 The “Rounds” of GATT
» Year Place/name Subjects covered Countries
» 1947 Geneva Tariffs 23
» 1949 Annecy Tariffs 13
» 1951 Torquay Tariffs 38
» 1956 Geneva Tariffs 26
» 1960-1961 Dillon Round Tariffs 26
» 1964-1967 Kennedy Round Tariffs AD measures 62
» 1973-1979 Tokyo Round Tariffs, non-tariff 102

» 1986-1994 Geneva Uruguay Round Tariffs, non-tariff measures, rules,

services, intellectual property, dispute settlement, textiles, agriculture, creation of
WTO, etc 123
» 2001 - Doha Round
WTO/GATT framework on tariff barriers

Basic principles and rules governing tariff negotiations:

❑ the principle of reciprocity and mutually advantageous
❑ the MFN treatment obligation

Organization of tariff negotiations:

❑ a selective product-by-product basis: request-and-offer
❑ other approaches: linear reduction approach, non-linear
harmonization formula approach, the Swiss formula…
WTO/GATT framework on tariff barriers

Schedules of Concessions

❑ A standard GATT/WTO schedule of concessions consists of

the following columns:
❑ Heading: tariff item number

❑ Product description

❑ Base rate of duty

❑ Bound rate after the concession

❑ Initial negotiating rights

❑ Other rights and duties

WTO/GATT framework on tariff barriers

❑ GATT Article II:1 (a): “Each contracting party shall accord

to the commerce of the other contracting parties treatment
no less favorable than that provided for in the appropriate
Part of the appropriate Schedule annexed to this
Agreement.”
❑ Article II:1 (b): “… Such products shall also be exempt
from all other duties or charges of any kind ”
❑ Exemptions for Free Trade Agreements and Economic
Integration Agreements (GATT Article XXIV)
 MODIFICATION OF SCHEDULES
• Temporary suspension of concessions
• Renegotiating the permanent schedule of concessions

• GATT Article XXVIII procedures:

• Re-opening every three years

• Reserved negotiations

• Special circumstances renegotiations

• Failure of negotiations

• Modification or withdrawal of concessions

• Other contracting parties may in response withdraw substantially equivalent concessions

❑ Rights of modification and compensation of Members affected by the withdrawal or

modification:
❑ Initial negotiating right

❑ Principal supplying interest

❑ Substantial interest
The Agreement on Customs Valuation
❑ Customs valuation rules to preserve the benefits of tariffs
and tariff negotiations
❑ GATT Article VII:2:
“The value for customs purposes of imported merchandise should
be based on the actual value of the imported merchandise on
which the duty is assessed, or of like merchandise, and should not
be based on the value of merchandise of national origin or on
arbitrary or fictitious values”.
❑ WTO Valuation Agreement of 1994
The Agreement on Customs Valuation
• “Actual value” of the good (transaction value): Basis of the
valuation must be the price of the transaction in question
• Subsidiary methods of valuation:

• Method 2: transaction value of identical goods

• Method 3: transaction value of similar goods
• Method 4: deductive value
• Method 5: computed value
• Method 6: fall-back: “any reasonable means”
RULES ON UNFAIR TRADE
WTO Anti-Dumping Agreement
 ANTI-DUMPING AGREEMENT (ADA)

■ ADA negotiated in Uruguay Round

■ Article VI carried over to GATT 1994
■ Article VI Part of ADA
• An anti-dumping measure shall be applied only under the
circumstances provided for in Article VI of GATT 1994 and
pursuant to investigations initiated and conducted in accordance
with the provisions of this Agreement (Art. 1 ADA).
■ Anti-dumping measures may only be imposed
• If dumping
• If injury caused by dumped imports
• Following a domestic investigation in accordance with ADA
procedural rules
4
 ANTI-DUMPING AGREEMENT (ADA)

Overview ADA
Part I
Arts. 1-15
Covers dumping, injury and domestic procedures
Part II
Arts. 16-17
Establishes the WTO Committee on Anti-Dumping Practices [ADP] and special rules for
WTO dispute settlement relating to anti-dumping matters
Part III
Art. 18
Final provisions
Annex I
Provides procedures for on-the-spot investigations
Annex II
Contains constraints on the use of best information available
6
 ANTI-DUMPING AGREEMENT (ADA)

Art. VI:1 GATT 1947/1994

The contracting parties recognize that dumping, by which products of one
country are introduced into the commerce of another country at less than the
normal value of the products, is to be condemned if it causes or threatens
material injury to an established industry in the territory of a contracting party
or materially retards the establishment of a domestic industry.

• ADA condemns, but does not prohibit dumping

• Permits protective action if product (1) dumped and (2) causing injury to
the domestic industry

• Subject to negotiations from inception; 1979 Tokyo Round Code

5
 Anti-dumping Agreement - Dumping

• Applies to goods, not services

• Does not apply to exchange dumping, social dumping, environmental

dumping or freight dumping

• Reasons why companies may dump also irrelevant so long as technical rules
are met

7
 DUMPING

Art. 2.1: For the purpose of this Agreement, a product is to be considered as

being dumped, i.e. introduced into the commerce of another country at less than its
normal value, if the export price of the product exported from one country to another
is less than the comparable price, in the ordinary course of trade, for the like product
when destined for consumption in the exporting country.

■ Dumping = Export Price < Normal Value

■ Four main steps:

1. Determination of the like product;
2. Determination of export price;
3. Determination of normal value; and
4. Comparison of export price and normal value.

12
 

DUMPING - LIKE PRODUCT

• Like product: Product, which is identical, i.e. alike in all respects, to the product under
consideration, or in the absence of such a product, another product, which has
characteristics closely resembling those of the product under consideration (Art. 2.6,
applies throughout ADA)
• Note that:
For dumping
Like Product = Product sold in exporting country like product under consideration, i.e. the
allegedly dumped product
For injury
Like Product = Product sold by domestic industry like the product under consideration, i.e.,
the allegedly dumped product

9
 

DUMPING - EXPORT PRICE

Export price: the price at which the product is exported from one country to
another (Art. 2.1)

IF:

(a) no export price exists OR 2) the export price is unreliable because there is a
relationship between the exporter and importer (ex. producing/exporting parent
company and related importer)

THEN

(b) the export price may be constructed using the price at which imported
goods are first resold to an independent buyer.

16
 

DUMPING - NORMAL VALUE

Main goal: to find comparable price in “ordinary course of

trade” for the like product in exporting country

3 ways to determine normal value

Domestic Price (preferred)

Third Country Export Prices

Constructed Normal Value

17
 

DUMPING - NORMAL VALUE
Non-Market Economies
“It is recognized that, in the case of imports from a country which has a
complete or substantially complete monopoly of its trade and where all
domestic prices are fixed by the State, special difficulties may exist in
determining price comparability for the purposes of paragraph 1, and in
such cases importing contracting parties may find it necessary to take
into account the possibility that a strict comparison with domestic
prices in such a country may not always be appropriate.”

(Second Supplementary Provision to paragraph 1.2 of Article VI GATT 1947)

• Export prices compared with prices or costs in third country
(surrogate/analogue country)
• Protocols of Accession of China and Vietnam: special provisions
allowing WTO Members to treat these countries as NMEs until 2016
and 2019 respectively
23
 

DUMPING - COMPARISON

• Fair Comparison between normal value and export price, but adjustments
must be made if the entity can demonstrate that there are differences affect
price comparability:
• Differences in commissions paid,
• After-sales costs,
• Costs of credit granted,
• Directly related transport and handling costs,
• Discounts, Rebates,
• Level of trade,
• Physical characteristics,
• Import charges and indirect taxes.

24
 ADA: Injury

Must find injury as well as dumping to impose anti-dumping

measures. Injury under ADA includes all of the following:

• Present material injury, future injury (threat of material

injury) and material retardation of the establishment of a
domestic industry (Footnote 9)

8
 

DUMPING AND INJURY INVESTIGATION PERIODS

Authorities need to gather data in order to investigate whether dumping

and injury exists.
Dumping Investigation Period
Shorter than injury investigation period
No ADA rules
ADP Committee suggested 12 months, and in any case no less than six
months, ending as close to the date of initiation of the investigation as is
practicable
Injury Investigation Period
No ADA rules
ADP Committee recommended injury be analysed over a period of at
least three years and should include the entire period of data collection
for the dumping investigation
Longer period needed to examine “trend factors”
10