TN/RL/W/213
30 November 2007
The background back to top
Six years
ago, in Doha, Members agreed to negotiations aimed at clarifying and
improving disciplines under the AD and SCM Agreements, while
preserving the basic concepts, principles and effectiveness of those
Agreements. They also agreed to negotiations to clarify and improve
disciplines on fisheries subsidies. Four years later, at Hong Kong,
Ministers gave more precision to that objective, directed the
Negotiating Group on Rules to intensify its work, and mandated me, as
Chairman, to prepare consolidated texts of the AD and SCM Agreements.
At the time, Ministers expected the Round to be completed in 2006,
and I myself had hoped to circulate consolidated texts in July of
that year.
That did
not happen but we nevertheless made good use of the extra time
available to us. In fact, at all times, we were jointly able to keep
the pace and direction of the negotiations. With that purpose in
mind we concentrated on detailed and text-based proposals. All that
collective effort was positive and indeed helped me in moving the
process forward. I am particularly thankful for those Participants
who were able to clearly identify their priorities and were capable
of putting them in legal language in effective time. Likewise, I am
thankful to those who, being in a defensive position, nevertheless
helped the process by seriously engaging in the discussions.
A new
challenge
However,
we have now reached a point of diminishing returns in our Negotiating
Group and more importantly, we now face the challenge of starting a
new phase. The overall negotiating process demands us to enter this
new realm. With the prospect of concluding the Doha Round soon, we
are now required not only to identify clearly our interests and the
language we prefer to foster those national objectives, but rather to
find also the way to accommodate others' concerns and interests. It
is time to start seeking balance and to help the rest of the
multilateral negotiations move forward too. With this perspective in
mind I decided not to seek the safety of “waiting and seeing”,
but rather to assume fully my responsibilities and encourage you to
start soon this much needed new stage of negotiations. I am
therefore pleased to present the Group with draft consolidated texts
as requested by Ministers.
The
architecture, aim and objectives of these texts
I am
putting these draft legal texts before the Group with the objective
of stimulating serious reflection by Participants on the broad
parameters of possible outcomes to the negotiations with respect to
the mandate in paragraph 28 of the Doha Declaration. There are no
brackets and no blanks, not because I expect or ask Participants to
agree to the texts at this stage, but indeed because I consider that
they are bracketed in their entirety. I thus ask Participants to
treat the texts as documents for intensive technical and detailed
work in the Group. In order to ensure such a specific and focused
discussion, these draft texts are presented in the form of proposed
revisions to the existing Agreements on Anti-Dumping and Subsidies
and Countervailing Measures, as manifested in specific legal
language.
While
these draft texts address all aspects of the Doha mandate in
paragraph 28, i.e., anti-dumping, subsidies and countervailing
measures and fisheries subsidies, they do not reflect every proposal
put before the Group. This does not of course preclude that the
issues contained in those proposals could be addressed in a
subsequent revision; my purpose in circulating these draft texts is
precisely to obtain further guidance from Participants. I also note
that, since the beginning of these negotiations, there has been a
broad acceptance that changes to the anti-dumping rules should, where
relevant and appropriate, also be made to the rules regarding
countervailing measures, and that is also my intention. I have not
in these texts transposed the draft revisions in the anti-dumping
rules into the countervail context because our discussions have
focused on anti-dumping and because such a transposition will require
further technical discussion.
In
preparing these draft texts, I have maintained as a paramount
principle the need to achieve in the negotiations a balance that
takes into account the interests of all Participants. I have
therefore attempted to develop texts that I believe could facilitate
the negotiation of a balanced outcome. Thus, while all Participants
will, I believe, find that a number of their demands have been taken
into account in these texts, every Participant will also find things
that they do not like, and even that they dislike intensely. That is
the normal, and indeed inevitable, result of a negotiating process
where the objectives of Participants vary widely and are in many
cases mutually incompatible. I call upon Participants to assess these
texts as a whole, and to carefully consider those elements that
respond to their demands and interests, rather than concentrating on
those elements that they do not like.
The
process ahead
With
respect to further process, I repeat that I do not request or invite
Participants to agree to anything in these draft texts at this point.
These texts are not the end of our negotiating process but only the
first step in a new phase involving further intensive discussions
within the Group. What I do expect of Participants is realistic and
pragmatic engagement. While up to now we have focused on considering
the specific demands of Participants through the examination of
negotiating proposals, this new phase of our work must involve real
negotiations where Participants will have to take into account the
needs of their negotiating partners as they pursue their own
objectives.
We will
start these discussions in two weeks time, with a first look at the
texts in each of the three areas of our work (anti-dumping, subsidies
and countervailing measures, fisheries subsidies). At that meeting I
need to hear your views as to whether these texts contain the
elements necessary to work towards an appropriately balanced outcome,
and if not, an explanation why not and, most importantly, where and
how you believe such a balance might be found. We will meet again in
the weeks of 21 January and 11 February 2008 for a more in-depth
process in which we will identify specific problems and then seek to
start resolving them. My intention is to circulate revised draft
texts as soon thereafter as I have a sufficient basis to do so.
_______________
AGREEMENT ON IMPLEMENTATION OF ARTICLE VI
OF THE GENERAL AGREEMENT ON TARIFFS AND TRADE 1994
Members hereby agree as follows:
PART I
Article 1
Principles
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.
The following provisions govern the application of Article VI of
GATT 1994 in so far as action is taken under anti dumping
legislation or regulations.
Article 2
Determination of Dumping
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.
2.2 When
there are no sales of the like product in the ordinary course of
trade in the domestic market of the exporting country or when,
because of the particular market situation or the low volume of the
sales in the domestic market of the exporting country,
such sales do not permit a proper comparison, the margin of dumping
shall be determined by comparison with a comparable price of the like
product when exported to an appropriate third country, provided that
this price is representative, or with the cost of production in the
country of origin plus a reasonable amount for administrative,
selling and general costs and for profits.
2.2.1 Sales of the like product in the domestic market of the
exporting country or sales to a third country at prices below per
unit (fixed and variable) costs of production plus administrative,
selling and general costs may be treated as not being in the ordinary
course of trade by reason of price and may be disregarded in
determining normal value only if the authorities determine that such sales are made within an extended period of time in substantial quantities and are at prices which do not provide for the recovery of all costs
within a reasonable period of time. If prices which are below per
unit costs at the time of sale are above weighted average per unit
costs for the period of investigation, such prices shall be
considered to provide for recovery of costs within a reasonable
period of time.
2.2.1.1 For the purpose of paragraph 2, costs shall normally
be calculated on the basis of records kept by the exporter or
producer under investigation, provided that such records are in
accordance with the generally accepted accounting principles of the
exporting country and reasonably reflect the costs associated with
the production and sale of the product under consideration.
Authorities shall consider all available evidence on the proper
allocation of costs, including that which is made available by the
exporter or producer in the course of the investigation, giving
due regard to any cost provided that such allocations have been historically utilized by the exporter or
producer, in particular in relation to establishing appropriate
amortization and depreciation periods and allowances for capital
expenditures and other development costs. Unless already reflected
in the cost allocations under this sub paragraph, costs shall be
adjusted appropriately for those non recurring items of cost
which benefit future and/or current production, or for circumstances
in which costs during the period of investigation are affected by
start up operations.
2.2.2 For the purpose of paragraph 2, the amounts for administrative,
selling and general costs and for profits shall be based on actual
data pertaining to production and sales in the ordinary course of
trade of the like product by the exporter or producer under
investigation. When such amounts cannot be determined on this basis,
the amounts may be determined on the basis of:
(i) the actual amounts incurred and realized by the exporter or
producer in question in respect of production and sales in the
domestic market of the country of origin of the same general category
of products;
(ii) the weighted average of the actual amounts incurred and
realized by other exporters or producers subject to investigation in
respect of production and sales of the like product in the domestic
market of the country of origin;
(iii) any other reasonable method, provided that the amount for
profit so established shall not exceed the profit normally realized
by other exporters or producers on sales of products of the same
general category in the domestic market of the country of origin.
2.3 In
cases where there is no export price or where it appears to the
authorities concerned that the export price is unreliable because of
association or a compensatory arrangement between the exporter and
the importer or a third party, the export price may be constructed on
the basis of the price at which the imported products are first
resold to an independent buyer, or if the products are not resold to
an independent buyer, or not resold in the condition as imported, on
such reasonable basis as the authorities may determine.
2.4 A fair
comparison shall be made between the export price and the normal
value. This comparison shall be made at the same level of trade,
normally at the ex factory level, and in respect of sales made
at as nearly as possible the same time. Due allowance shall be made
in each case, on its merits, for differences which affect price
comparability, including differences in conditions and terms of sale,
taxation, levels of trade, quantities, physical characteristics, and
any other differences which are also demonstrated to affect price
comparability. In the cases referred to in paragraph 3, allowances for costs,
including duties and taxes, incurred between importation and resale,
and for profits accruing, should also be made. If in these cases
price comparability has been affected, the authorities shall
establish the normal value at a level of trade equivalent to the
level of trade of the constructed export price, or shall make due
allowance as warranted under this paragraph. The authorities shall
indicate to the parties in question what information is necessary to
ensure a fair comparison and shall not impose an unreasonable burden
of proof on those parties.
2.4.1 When the comparison under paragraph 4 requires a conversion of
currencies, such conversion should be made using the rate of
exchange on the date of sale taken from a source of recognized authority,
provided that when a sale of foreign currency on forward markets is
directly linked to the export sale involved, the rate of exchange in
the forward sale shall be used. Fluctuations in exchange rates shall
be ignored and in an investigation the authorities shall allow
exporters at least 60 days to have adjusted their export prices
to reflect sustained movements in exchange rates during the period of
investigation.
2.4.1.1 The source of recognized authority normally used, and
the specific method normally followed by the authorities in applying
subparagraph 4.1, shall be set forth in the laws, regulations or
published administrative procedures of the Member concerned, and
their application to each particular case shall be transparent and
adequately explained.
2.4.1.2 If, in a particular case, a Member does not use the
source of recognized authority or specific method set forth in its
laws, regulations or published administrative procedures, it shall
explain in the relevant public notices under Article 12 why it did
not use such source or method.
2.4.2 Subject to the provisions governing fair comparison in
paragraph 4, the existence of margins of dumping during
thein an investigation phase initiated
pursuant to Article 5 shall normally be established on the basis
of a comparison of a weighted average normal value with a weighted
average of prices of all comparable export transactions or by a
comparison of normal value and export prices on a
transaction to transaction basis. A normal value
established on a weighted average basis may be compared to prices of
individual export transactions if the authorities find a pattern of
export prices which differ significantly among different purchasers,
regions or time periods, and if an explanation is provided as to why
such differences cannot be taken into account appropriately by the
use of a weighted average to weighted average or
transaction to transaction comparison.
2.4.3 When the authorities aggregate the results of multiple
comparisons in order to establish the existence or extent of a margin
of dumping, the provisions of this paragraph shall apply:
(i) when, in an investigation initiated pursuant to Article 5,
the authorities aggregate the results of multiple comparisons of a
weighted average normal value with a weighted average of prices of
all comparable export transactions, they shall take into account the
amount by which the export price exceeds the normal value for any of
the comparisons.
(ii) when, in an investigation initiated pursuant to Article 5,
the authorities aggregate the results of multiple comparisons of
normal value and export prices on a transaction-to-transaction basis
or of multiple comparisons of individual export transactions to a
weighted average normal value, they may disregard the amount by which
the export price exceeds the normal value for any of the comparisons.
(iii) when, in a review pursuant to Articles 9 or 11, the
authorities aggregate the results of multiple comparisons, they may
disregard the amount by which the export price exceeds the normal
value for any of the comparisons.
2.4.4 When there are differences with respect to models, types,
grades or quality within the product under consideration, the
authorities shall provide exporters and foreign producers with timely
opportunities to express their views regarding possible
categorization and matching for purposes of comparison. This shall
not prevent the authorities from proceeding expeditiously with the
investigation.
2.5 In the
case where products are not imported directly from the country of
origin but are exported to the importing Member from an intermediate
country, the price at which the products are sold from the country of
export to the importing Member shall normally be compared with the
comparable price in the country of export. However, comparison may
be made with the price in the country of origin, if, for example, the
products are merely transshipped through the country of export, or
such products are not produced in the country of export, or there is
no comparable price for them in the country of export.
2.6 Throughout
this Agreement:
(a) The term “product under consideration” shall be
interpreted to mean the imported product subject to investigation or
review. The product under consideration shall be limited to imported
products that share the same basic physical characteristics. The
existence of differences with respect to factors such as models,
types, grades and quality shall not prevent imported products from
being part of the same product under consideration if they share the
same basic physical characteristics. Whether such differences are so
significant as to preclude inclusion of imported products within a
single product under consideration shall be determined on the basis
of relevant factors, which may include similarity in use,
interchangeability, competition in the same market and distribution
through the same channels.
(b) Tthe term “like product”
(“produit similaire”) shall be interpreted to mean a
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, although not alike in all respects, has
characteristics closely resembling those of the product under
consideration.
2.7 This
Article is without prejudice to the second Supplementary Provision to
paragraph 1 of Article VI in Annex I to GATT 1994.
Article 3
Determination of Injury
3.1 A
determination of injury for purposes of Article VI of GATT 1994
shall be based on positive evidence and involve an objective
examination of both (a) the volume of the dumped imports and the effect of the dumped imports on prices in the domestic market
for like products, and (b) the consequent impact of these
imports on domestic producers of such products.
3.2 With
regard to the volume of the dumped imports, the investigating
authorities shall consider whether there has been a significant
increase in dumped imports, either in absolute terms or relative to
production or consumption in the importing Member. With regard to
the effect of the dumped imports on prices, the investigating
authorities shall consider whether there has been a significant price
undercutting by the dumped imports as compared with the price of a
like product of the importing Member, or whether the effect of such
imports is otherwise to depress prices to a significant degree or
prevent price increases, which otherwise would have occurred, to a
significant degree. No one or several of these factors can
necessarily give decisive guidance.
3.3 Where
imports of a product from more than one country are simultaneously
subject to anti dumping investigations, the investigating
authorities may cumulatively assess the effects of such imports only
if they determine that (a) the margin of dumping established
in relation to the imports from each country is more than de
minimis as defined in paragraph 8 of Article 5 and the
volume of imports from each country is not negligible and (b) a cumulative assessment of the effects of the imports is appropriate
in light of the conditions of competition between the imported
products and the conditions of competition between the imported
products and the like domestic product.
3.4 The
examination of the impact of the dumped imports on the domestic
industry concerned shall include an evaluation of all relevant
economic factors and indices having a bearing on the state of the
industry, including actual and potential decline in sales, profits,
output, market share, productivity, return on investments, or
utilization of capacity; factors affecting domestic prices; the
magnitude of the margin of dumping; actual and potential negative
effects on cash flow, inventories, employment, wages, growth, ability
to raise capital or investments. This list is not exhaustive, nor
can one or several of these factors necessarily give decisive
guidance.
3.5 It
must be demonstrated that the dumped imports are, through the effects
of dumping, as set forth in paragraphs 2 and 4, causing
injury within the meaning of this Agreement. The demonstration of a
causal relationship between the dumped imports and the injury to the
domestic industry shall be based on an examination of all relevant
evidence before the authorities. The authorities shall also examine
any known factors other than the dumped imports which at the same
time are injuring the domestic industry, and the injuries ous effects of caused by these other factors must
not be attributed to the dumped imports. The examination required by this paragraph may be based on a
qualitative analysis of evidence concerning, inter
alia, the nature, extent, geographic concentration, and
timing of such injurious effects. While the authorities should seek
to separate and distinguish the injurious effects of such other
factors from the injurious effects of dumped imports, they need not
quantify the injurious effects attributable to dumped imports and to
other factors, nor weigh the injurious effects of dumped imports
against those of other factors. Factors which may be
relevant in this respect include, inter alia, the volume
and prices of imports not sold at dumping prices, contraction in
demand or changes in the patterns of consumption, trade restrictive
practices of and competition between the foreign and domestic
producers, developments in technology and the export performance and
productivity of the domestic industry.
3.6 The
effect of the dumped imports shall be assessed in relation to the
domestic production of the like product when available data permit
the separate identification of that production on the basis of such
criteria as the production process, producers' sales and profits. If
such separate identification of that production is not possible, the
effects of the dumped imports shall be assessed by the examination of
the production of the narrowest group or range of products, which
includes the like product, for which the necessary information can be
provided.
3.7 A
determination of a threat of material injury shall be based on facts
and not merely on allegation, conjecture or remote possibility. The
change in circumstances which would create a situation in which the
dumping would cause injury must be clearly foreseen and imminent. In making a determination regarding the existence of a threat of
material injury, the authorities shall consider the state of the
domestic industry during the period of investigation, including an
examination of the impact of dumped imports upon it in accordance
with paragraph 4, in order to establish a background for the
evaluation of threat of material injury. In addition, the
authorities should consider, inter alia, such factors
as:
(i) a significant rate of increase of dumped imports into the
domestic market indicating the likelihood of substantially increased
importation;
(ii) sufficient freely disposable, or an imminent, substantial
increase in, capacity of the exporter indicating the likelihood of
substantially increased dumped exports to the importing Member's
market, taking into account available evidence concerning the
availability of other export markets to absorb any additional
exports;
(iii) whether imports are entering at prices that will have a
significant depressing or suppressing effect on domestic prices, and
would likely increase demand for further imports; and
(iv) inventories of the product being investigated.
No one of
these factors by itself can necessarily give decisive guidance but
the totality of the factors considered must lead to the conclusion
that further dumped exports are imminent and that, unless protective
action is taken, material injury would occur.
3.8 With
respect to cases where injury is threatened by dumped imports, the
application of anti dumping measures shall be considered and
decided with special care.
3.9 A
determination of material retardation of the establishment of a
domestic industry shall be based on facts and not merely on
allegation, conjecture or remote possibility. An industry may be
considered to be in establishment where a genuine and substantial
commitment of resources has been made to domestic production of a
like product not previously produced in the territory of the
importing Member, but production has not yet begun or has not yet
been achieved in commercial volumes. In making a determination whether an industry is in establishment,
and in examining the impact of dumped imports on the establishment of
that industry, the authorities may take into account evidence
concerning, inter alia, installed
capacity, investments made and financing obtained, and feasibility
studies, investment plans or market studies.
Article 4
Definition of Domestic Industry
4.1 For
the purposes of this Agreement, and except to the extent otherwise
provided in Article 5.4, the term “domestic industry”
shall be interpreted as referring to the domestic producers as a
whole of the like products or to those of them whose collective
output of the products constitutes a major proportion of the total
domestic production of those products, except that:
(i) when producers are related to the exporters or importers or are themselves importers of the allegedly dumped product under consideration,
the term “domestic industry” may be interpreted as
referring to the rest of the producers, ;
(ii) in exceptional circumstances the territory of a Member may, for
the production in question, be divided into two or more competitive
markets and the producers within each market may be regarded as a
separate industry if (a) the producers within such market
sell all or almost all of their production of the product in question
in that market, and (b) the demand in that market is not
to any substantial degree supplied by producers of the product in
question located elsewhere in the territory. In such circumstances,
injury may be found to exist even where a major portion of the total
domestic industry is not injured, provided there is a concentration
of dumped imports into such an isolated market and provided further
that the dumped imports are causing injury to the producers of all or
almost all of the production within such market.
4.2 When
the domestic industry has been interpreted as referring to the
producers in a certain area, i.e. a market as defined in
paragraph 1(ii), anti dumping duties shall be levied only on the products in question consigned for final consumption to
that area. When the constitutional law of the importing Member does
not permit the levying of anti dumping duties on such a basis,
the importing Member may levy the anti dumping duties without
limitation only if (a) the exporters shall have been
given an opportunity to cease exporting at dumped prices to the area
concerned or otherwise give assurances pursuant to Article 8 and
adequate assurances in this regard have not been promptly given, and (b) such duties cannot be levied only on products of
specific producers which supply the area in question.
4.3 Where
two or more countries have reached under the provisions of
paragraph 8(a) of Article XXIV of GATT 1994 such a
level of integration that they have the characteristics of a single,
unified market, the industry in the entire area of integration shall
be taken to be the domestic industry referred to in paragraph 1.
4.4 The
provisions of paragraph 6 of Article 3 shall be applicable
to this Article.
Article 5
Initiation and Subsequent Investigation
5.1 Except
as provided for in paragraph 6, an investigation to determine
the existence, degree and effect of any alleged dumping shall be
initiated upon a written application by or on behalf of the domestic
industry.
5.2 An
application under paragraph 1 shall include evidence of (a) dumping, (b) injury within the meaning of
Article VI of GATT 1994 as interpreted by this Agreement
and (c) a causal link between the dumped imports and the
alleged injury. Simple assertion, unsubstantiated by relevant
evidence, cannot be considered sufficient to meet the requirements of
this paragraph. The application shall contain such information as is
reasonably available to the applicant on the following:
(i) (a) the identity of the applicant and the domestic
industry by or on behalf of which the application is made and, where
the applicant is itself a producer, a description of the volume
and value of the domestic production of the like product by the
applicant;. Where a written
application is made on behalf of the domestic industry, the
application shall identify the industry on behalf of which the
application is made by a list of all known domestic producers of the
like product (or associations of domestic producers of the like
product) (b) the identity of those producers (or, to the
extent this is not practicable in the case of fragmented industries,
associations of domestic producers of the like product) supporting
the application, and, to the extent possible, a description of
the volume and value of domestic production of the like product
accounted for by those such producers or
associations of producers; and (c) the identity of all known
domestic producers of the like product (or, to the extent this is not
practicable in the case of a fragmented industry, associations of
domestic producers of the like product) and, to the extent possible,
a description of the total volume and value of domestic production of
the like product;
(ii) a complete description of the allegedly dumped product, the
names of the country or countries of origin or export in question,
the identity of each known exporter or foreign producer and a list of
known persons importing the product in question;
(iii) information on prices at which the product in question is sold
when destined for consumption in the domestic markets of the country
or countries of origin or export (or, where appropriate, information
on the prices at which the product is sold from the country or
countries of origin or export to a third country or countries, or on
the constructed value of the product) and information on export
prices or, where appropriate, on the prices at which the product is
first resold to an independent buyer in the territory of the
importing Member;
(iv) information on the evolution of the volume of the allegedly
dumped imports, the effect of these imports on prices of the like
product in the domestic market and the consequent impact of the
imports on the domestic industry, as demonstrated by relevant factors
and indices having a bearing on the state of the domestic industry,
such as those listed in paragraphs 2 and 4 of Article 3.
5.3 The
authorities shall examine the accuracy and adequacy of the evidence
provided in the application to determine whether there is sufficient evidence to justify the
initiation of an investigation.
5.4 An
investigation shall not be initiated pursuant to paragraph 1
unless the authorities have determined, on the basis of an
examination of the degree of support for, or opposition to, the
application expressed by domestic producers of the like product, that the application has
been made by or on behalf of the domestic industry. The application shall be considered to have been made “by or
on behalf of the domestic industry” if it is
supported by those domestic producers whose collective output
constitutes more than 50 per cent of the total production of the
like product produced by that portion of the domestic industry
expressing either support for or opposition to the application.
However, no investigation shall be initiated when domestic producers
expressly supporting the application account for less than 25 per
cent of total production of the like product produced by the domestic
industry. For the purpose of this paragraph, the term “domestic
industry” shall be interpreted as referring to the domestic
producers as a whole of the like product, subject to the application
of Article 4.1(i) and 4.1(ii).
5.5 The
authorities shall avoid, unless a decision has been made to initiate
an investigation, any publicizing of the application for the
initiation of an investigation. However, after an receipt
of a properly documented application has been filed and no later than 15 days before initiating before
proceeding to initiate an investigation, the authorities
shall notify the government of the exporting Member concerned and
shall provide it with the full text of the written application,
paying due regard to the requirement for the protection of
confidential information as provided for in paragraph 5 of Article 6.
5.6 If, in
special circumstances, the authorities concerned decide to initiate an investigation without
having received a written application by or on behalf of a domestic
industry for the initiation of such investigation, they shall proceed
only if they have sufficient evidence of dumping, injury and a causal
link, as described in paragraph 2, to justify the initiation of
an investigation.
5.6bis An
investigation under this Article shall be initiated and conducted,
and a determination of the existence of dumping, injury and causal
link shall be made, only with respect to a single product under
consideration, the scope of which shall be determined in accordance
with Article 2.6(a). If during the course of an investigation
authorities find, in light of the evidence obtained, that the
investigation includes imported products that are not properly
included within the scope of the product under consideration, they
shall amend the product scope of the investigation and shall only
impose an anti-dumping duty on imports of any distinct product under
consideration if they make determinations of the existence of
dumping, injury and causal link with respect to that product.
5.7 The
evidence of both dumping and injury shall be considered
simultaneously (a) in the decision whether or not to
initiate an investigation, and (b) thereafter, during the
course of the investigation, starting on a date not later than the
earliest date on which in accordance with the provisions of this
Agreement provisional measures may be applied.
5.8 An
application under paragraph 1 shall be rejected and an
investigation shall be terminated promptly as soon as the authorities
concerned are satisfied that there is not sufficient evidence of
either dumping or of injury to justify proceeding with the case.
There shall be immediate termination in cases where the authorities
determine that the margin of dumping is de minimis, or
that the volume of dumped imports, actual or potential, or the
injury, is negligible. The margin of dumping shall be considered to
be de minimis if this margin is less than 2 per
cent, expressed as a percentage of the export price. The volume of
dumped imports shall normally be regarded as negligible if the volume
of dumped imports from a particular country is found to account for
less than 3 per cent of imports of the like product in the
importing Member, unless countries which individually account for
less than 3 per cent of the imports of the like product in
the importing Member collectively account for more than 7 per
cent of imports of the like product in the importing Member.
5.9 An
anti dumping proceeding shall not hinder the procedures of
customs clearance.
5.10 Investigations
shall, except in special circumstances, be concluded within one year,
and in no case more than 18 months, after their initiation.
5.10bis Except
where circumstances have changed, the authorities shall not initiate
an investigation where a previous investigation of the same product
from the same Member initiated pursuant to this Article resulted in a
negative final determination within one year prior to the filing of
the application. If an investigation is initiated in such a case,
the authorities shall explain the changed circumstances which warrant
initiation in the notice of initiation or separate report provided
for in Article 12.1.
Article 6
Evidence
6.1New The
authorities may request interested parties to supply such information
as the authorities reasonably consider may be necessary for the
conduct of the investigation, including information in the possession
of parties that are affiliated to those interested parties.
6.1 All
interested parties in an anti dumping investigation shall be
given notice of the information which the authorities require and
ample opportunity to present in writing all evidence which they
consider relevant in respect of the investigation in question.
6.1.1 Exporters or foreign producers receiving questionnaires used
in an anti dumping investigation shall be given at least 30
days for reply., Due consideration should be given to any request for an extension
of the 30 day period and, upon cause shown, such an extension
should be granted whenever practicable.
6.1.1bis Within a reasonable period
of time after the receipt of the response to a questionnaire, the
authorities shall make a preliminary analysis of that response and
shall notify the interested party concerned in writing of any
requests for clarification or additional information.
6.1.2 Subject to the requirement to protect confidential information,
evidence presented in writing by one interested party shall be made
available promptly to other interested parties participating in the
investigation.
6.1.3 As soon as an investigation has been initiated, the authorities
shall provide the full text of the written application received under
paragraph 1 of Article 5 to the known exporters and to the authorities of the exporting Member and
shall make it available, upon request, to other interested parties
involved. Due regard shall be paid to the requirement for the
protection of confidential information, as provided for in
paragraph 5.
6.2 Throughout
the anti dumping investigation all interested parties shall have
a full opportunity for the defence of their interests. To this end,
the authorities shall, on request, provide opportunities for all
interested parties to meet those parties with adverse interests, so
that opposing views may be presented and rebuttal arguments offered.
Provision of such opportunities must take account of the need to
preserve confidentiality and of the convenience to the parties.
There shall be no obligation on any party to attend a meeting, and
failure to do so shall not be prejudicial to that party's case.
Interested parties shall also have the right, on justification, to
present other information orally.
6.3 Oral
information provided under paragraph 2 shall be taken into
account by the authorities only in so far as it is subsequently
reproduced in writing and made available to other interested parties,
as provided for in subparagraph 1.2.
6.4 The
authorities shall whenever practicable provide timely opportunities for all interested parties to
see promptly all information that is relevant to the
presentation of their cases, that is non t confidential information as defined in paragraph 5,
and that is used by before the
authorities in an anti dumping investigation, and to prepare
presentations on the basis of this information.
6.4bis The
authorities shall maintain a file containing all non-confidential
documents submitted to or obtained by the authorities in an
anti-dumping proceeding, including non-confidential summaries of
confidential documents and any explanations provided pursuant to
Article 6.5.1 as to why summarization is not possible, and shall
allow any person to review and copy the documents in that file upon
request. Access to this file shall be provided promptly, and in any
case within two working days of a request. The non-confidential file
shall be kept in an organized manner, and a complete index of all
documents in the possession of the authorities, including
confidential documents, shall be included therein. Each file shall
include all public notices related to that proceeding issued pursuant
to Article 12, as well as separate reports issued pursuant to
footnote 60 to that Article. Each file shall be maintained for at
least five years beyond the date that the proceeding is completed.
The authorities shall provide for the copying of documents in the
non-confidential file at the reasonable expense of the person so
requesting, or shall allow, subject to reasonable safeguards, that
person to remove the documents for copying elsewhere.
6.5 Any
information which is by nature confidential (for example, because its
disclosure would be of significant competitive advantage to a
competitor or because its disclosure would have a significantly
adverse effect upon a person supplying the information or upon a
person from whom that person acquired the information), or which is
provided on a confidential basis by parties to an investigation
shall, upon good cause shown, be treated as such by the authorities.
Such information shall not be disclosed without specific permission
of the party submitting it.
6.5.1 The authorities shall require interested parties providing
confidential information to furnish non confidential versions
of the document containing the confidential information within two
working days of submitting the original document.summaries
thereof. The non-confidential version shall be identical
to the version containing the confidential information, except that
the confidential information shall be removed and replaced by a
summary of that information These summaries shall be in
sufficient detail to permit a reasonable understanding of the
substance of the information submitted in confidence. In exceptional
circumstances, such parties providing
confidential information may indicate that such information is
not susceptible of summary. In such exceptional circumstances, a
statement of the reasons why summarization is not possible must be
provided.
6.5.2 If the authorities find that a request for confidentiality is
not warranted and if the supplier of the information is either
unwilling to make the information public or to authorize its
disclosure in generalized or summary form, the authorities may
disregard such information unless it can be demonstrated to their
satisfaction from appropriate sources that the information is
correct.
6.6 Except
in circumstances provided for in paragraph 8, the authorities
shall during the course of an investigation satisfy themselves as to
the accuracy of the information supplied by interested parties upon
which their findings are based.
6.7 In
order to verify information provided or to obtain further details,
the authorities may carry out investigations in the territory of
other Members as required, provided they obtain the agreement of the
firms concerned and notify the representatives of the government of
the Member in question, and unless that Member objects to the
investigation. The procedures described in Annex I shall apply
to investigations carried out in the territory of other Members. Subject to the requirement to protect confidential
information, the authorities shall make the results of any such
investigations available, or shall provide disclosure thereof
pursuant to paragraph 9, to the firms to which they pertain and
may make such results available to the applicants.
6.8 In
cases in which any interested party refuses access to, or otherwise
does not provide, necessary information within a reasonable period or
significantly impedes the investigation, preliminary and final
determinations, affirmative or negative, may be made on the basis of
the facts available. The provisions of Annex II shall be
observed in the application of this paragraph.
6.8.1 Where an interested party substantiates that it does not
control an affiliated party and that, despite its best efforts, it has been
unable to obtain requested information from that affiliated party,
the authorities shall consider whether to maintain, modify or
withdraw the request, taking into account the importance of the
information to the investigation. In the event the authorities
decide to maintain the request, whether in the same form or as
modified, they shall take such reasonable steps as are available to
them to support the interested party's efforts to obtain the
information. Where despite the interested party's best efforts,
necessary information in the possession of an affiliated party is not
supplied, the authorities may base their determinations on the facts
available. They shall not, however, deem the interested party to
have been non-cooperative.
6.9 The
authorities shall, before a final determination is made, inform provide all interested parties with a written
report of the essential facts under consideration which they
intend will form the basis for the decision whether to apply
definitive measures. Interested parties shall have 20 days to
respond to this report and the authorities shall address any
responses in their final determination.Such
disclosure should take place in sufficient time for the parties to
defend their interests.
6.9bis The
authorities shall, normally within seven days after giving public
notice of a final determination under Article 12.2, disclose to each
exporter or producer for whom an individual rate of duty has been
determined the calculations used to determine the margin of dumping
for that exporter or producer. The authorities shall provide to the exporter or producer the
calculations, either in electronic format (such as a computer
programme or spreadsheet) or in another appropriate medium, a
detailed explanation of the information used, the sources of that
information and any adjustments made to the information prior to its
use in the calculations. The disclosure and explanation shall be in
sufficient detail to permit the interested party to reproduce the
calculations without undue difficulty.
6.10 The
authorities shall, as a rule, determine an individual margin of
dumping for each known exporter or producer concerned of the product
under investigation consideration. In cases
where the number of exporters, producers, importers or types of
products involved is so large as to make such a determination
impracticable, the authorities may limit their examination either to
a reasonable number of interested parties or products by using
samples which are statistically valid on the basis of information
available to the authorities at the time of the selection, or to the
largest percentage of the volume of the exports from the country in
question which can reasonably be investigated.
6.10.1 Any selection of exporters, producers, importers or types of
products made under this paragraph shall preferably be
chosen in consultation with, and preferably with the
consent of, the exporters, producers or importers concerned.
6.10.2 In cases where the authorities have limited their examination,
as provided for in this paragraph, they shall nevertheless determine
an individual margin of dumping for any exporter or producer not
initially selected who submits the necessary information in time for
that information to be considered during the course of the
investigation, except where the number of exporters or producers is
so large that individual examinations would be unduly burdensome to
the authorities and prevent the timely completion of the
investigation. Voluntary responses shall not be discouraged.
6.10.3 Where the authorities limit their examination pursuant to
this paragraph, they shall explain, in their public notices pursuant
to Article 12, the basis for their conclusion that it was
impracticable to determine an individual margin of dumping for each
known exporter or producer, the reasons for the specific selection
made and the reasons why an individual margin was not determined for
any exporter or producer not initially selected who submitted the
necessary information in time for that information to be considered
during the course of the investigation.
6.11 For
the purposes of this Agreement, “interested parties” shall
include:
(i) an exporter or foreign producer or the importer of a product subject to investigation, under consideration or a trade or business association a majority of the members of which
are producers, exporters or importers of such product;
(ii) the government of the exporting Member; and
(iii) a producer of the like product in the importing Member or a
trade and business association a majority of the members of which
produce the like product in the territory of the importing Member.
This list
shall not preclude Members from allowing domestic or foreign parties
other than those mentioned above to be included as interested
parties.
6.12 The
authorities shall provide opportunities for industrial users of the
product under investigationconsideration, and
for representative consumer organizations in cases where the product
is commonly sold at the retail level, to provide information which is
relevant to the investigation regarding dumping, injury and
causality.
6.13 The
authorities shall take due account of any difficulties experienced by
interested parties, in particular small companies, in supplying
information requested, and shall provide any assistance practicable,
including by responding in a timely manner to requests for
clarification of questionnaires.
6.14 The
procedures set out above are not intended to prevent the authorities
of a Member from proceeding expeditiously with regard to initiating
an investigation, reaching preliminary or final determinations,
whether affirmative or negative, or from applying provisional or
final measures, in accordance with relevant provisions of this
Agreement.
Article 7
Provisional Measures
7.1 Provisional
measures may be applied only if:
(i) an investigation has been initiated in accordance with the
provisions of Article 5 and, a public
notice has been given to that effect; and
(ii) interested parties have been given adequate opportunities to
submit information, including responses to questionnaires sent in
accordance with Article 6.1.1, and make comments;
(iii) a detailed preliminary affirmative determination
has been made of dumping and consequent injury to a domestic industry taking into account any responses to questionnaires and any other
relevant information submitted by interested parties; and
(iiiiv) the authorities concerned judge such
measures necessary to prevent injury being caused during the
investigation.
7.2 Provisional
measures may take the form of a provisional duty or, preferably, a
security by cash deposit or bond equal to the
amount of the anti dumping duty provisionally estimated, being
not greater than the provisionally estimated margin of dumping.
Withholding of appraisement is an appropriate provisional measure,
provided that the normal duty and the estimated amount of the
anti dumping duty be indicated and as long as the withholding of
appraisement is subject to the same conditions as other provisional
measures.
7.3 Provisional
measures shall not be applied sooner than 60 days from the date of
initiation of the investigation.
7.4 The
application of provisional measures shall be limited to as short a
period as possible, not exceeding foursix months
or, on decision of the authorities concerned, upon request by
exporters representing a significant percentage of the trade
involved, to a period not exceeding sixnine months. When authorities, in the course of an investigation,
examine whether a duty lower than the margin of dumping would be
sufficient to remove injury, these periods may be six and nine
months, respectively.
7.5 The
relevant provisions of Article 9 shall be followed in the application
of provisional measures.
Article 8
Price Undertakings
8.1 Proceedings
may be suspended or terminated without the imposition of provisional
measures or anti dumping duties upon receipt of satisfactory
voluntary undertakings from any exporter to revise its prices or to
cease exports to the area in question at dumped prices so that the
authorities are satisfied that the injurious effect of the dumping is
eliminated. Price increases under such undertakings shall not be
higher than necessary to eliminate the margin of dumping. It
is desirable that the price increases be less than the margin of
dumping if such increases would be adequate to remove the injury to
the domestic industry.
8.2 Price
undertakings shall not be sought or accepted from exporters unless
the authorities of the importing Member have made a preliminary
affirmative determination of dumping and injury caused by such
dumping or, if no affirmative preliminary determination is made,
until the authorities have made disclosure pursuant to paragraph 9 of
Article 6. The authorities shall inform exporters of their right to
offer undertakings and shall allow them an adequate opportunity to do
so.
8.3 Undertakings offered need not be accepted if the authorities
consider their acceptance impractical, for example, if the number of
actual or potential exporters is too great, or for other reasons,
including reasons of general policy. Should the case arise
and where practicable, tThe authorities shall provide
to the exporter the reasons which have led them to consider
acceptance of an undertaking as inappropriate, and shall, to
the extent possible, give the exporter an opportunity to
make comments thereon.
8.4 If an
undertaking is accepted, the investigation of dumping and injury
shall nevertheless be completed if the exporter so desires or the
authorities so decide. In such a case, if a negative determination
of dumping or injury is made, the undertaking shall automatically
lapse, except in cases where such a determination is due in large
part to the existence of a price undertaking. In such cases, the
authorities may require that an undertaking be maintained for a
reasonable period consistent with the provisions of this Agreement.
In the event that an affirmative determination of dumping and injury
is made, the undertaking shall continue consistent with its terms and
the provisions of this Agreement.
8.5 Price
undertakings may be suggested by the authorities of the importing
Member, but no exporter shall be forced to enter into such
undertakings. The fact that exporters do not offer such
undertakings, or do not accept an invitation to do so, shall in no
way prejudice the consideration of the case. However, the
authorities are free to determine that a threat of injury is more
likely to be realized if the dumped imports continue.
8.6 Authorities
of an importing Member may require any exporter from whom an
undertaking has been accepted to provide periodically information
relevant to the fulfilment of such an undertaking and to permit
verification of pertinent data. In case of material violation
of an undertaking, the authorities of the importing Member may take,
under this Agreement in conformity with its provisions, expeditious
actions which may constitute immediate application of provisional
measures using the best information available. In such cases, definitive duties may be levied in accordance with
this Agreement on products entered for consumption not more than 90
days before the application of such provisional measures, except that
any such retroactive assessment shall not apply to imports entered
before the violation of the undertaking.
Article 9
Imposition and Collection of Anti Dumping Duties
9.1 The
decision whether or not to impose an anti dumping duty in cases
where all requirements for the imposition have been fulfilled, and
the decision whether the amount of the anti dumping duty to be
imposed shall be the full margin of dumping or less, are decisions to
be made by the authorities of the importing Member. It is
desirable that the imposition be permissive in the territory of all
Members, and that the duty be less than the margin if such lesser
duty would be adequate to remove the injury to the domestic industry. Each Member whose national legislation contains provisions on
anti-dumping measures shall establish procedures in its laws or
regulations to enable its authorities, in making such decisions in an
investigation initiated pursuant to Article 5, to take due account of
representations made by domestic interested parties whose interests might be affected by the imposition of an
anti-dumping duty. The application of these procedures, and decisions made pursuant to
them, shall not be subject to dispute settlement pursuant to the DSU,
Article 17 of this Agreement or any other provision of the WTO
Agreement.
9.2 When
an anti dumping duty is imposed in respect of any product, such
anti dumping duty shall be collected in the appropriate amounts
in each case, on a non discriminatory basis on imports of such
product from all sources found to be dumped and causing injury,
except as to imports from those sources from which price undertakings
under the terms of this Agreement have been accepted. The
authorities shall name the supplier or suppliers of the product
concerned. If, however, several suppliers from the same country are
involved, and it is impracticable to name all these suppliers, the
authorities may name the supplying country concerned. If several
suppliers from more than one country are involved, the authorities
may name either all the suppliers involved, or, if this is
impracticable, all the supplying countries involved.
9.3 The
amount of the anti dumping duty shall not exceed the margin of
dumping as established under Article 2. In this regard, each
Member shall establish procedures to ensure a prompt refund, upon request, where the duty or security
collected exceeds the actual margin of dumping. In this respect, the following subparagraphs shall apply.
9.3.1New A determination of final liability for payment of
anti-dumping duties, or of whether a duty in excess of the margin of
dumping has been paid, may be made on the basis of (i) individual
import transactions, (ii) all import transactions by an importer from
an exporter or producer, or (iii) all import transactions from an
exporter or producer. In determining the existence or amount of
liability for any duty, or the entitlement to any refund, the
authorities may disregard the amount by which the export price
exceeds the normal value for any comparisons.
9.3.1 When the amount of the anti dumping duty is assessed on a
retrospective basis, the determination of the final liability for
payment of anti dumping duties shall take place as soon as
possible, normally within 12 months, and in no case more than
18 months, after the date on which a request for a final
assessment of the amount of the anti dumping duty has been
made. Any refund shall be made promptly and normally in not more than
90 days following the determination of final liability made
pursuant to this sub paragraph. In any case, where a refund is
not made within 90 days, the authorities shall provide an
explanation if so requested.
9.3.2 When the amount of the anti dumping duty is assessed on a
prospective basis, provision shall be made for a prompt refund, upon
request, of any duty paid in excess of the margin of dumping. A
refund of any such duty paid in excess of the actual margin of
dumping shall normally take place within 12 months, and in no
case more than 18 months, after the date on which a request for
a refund, duly supported by evidence, has been made by an importer of
the product subject to the anti dumping duty, or by an
exporter on behalf of, and in association with, one or more
importers. The refund authorized should normally be made within
90 days of the above noted decision.
9.3.3 In determining whether and to what extent a reimbursement
should be made when the export price is constructed in accordance
with paragraph 3 of Article 2, authorities should take
account of any change in normal value, any change in costs incurred
between importation and resale, and any movement in the resale price
which is duly reflected in subsequent selling prices, and should
calculate the export price with no deduction for the amount of
anti dumping duties paid when conclusive evidence of the above
is provided.
9.3.4 In the event that monies paid or deposited are refunded
pursuant to this paragraph, the authorities shall pay a reasonable
amount of interest on the monies refunded.
9.4 When
the authorities have limited their examination in accordance with the
second sentence of paragraph 10 of Article 6, any
anti dumping duty applied to imports from exporters or producers
not included in the examination shall not exceed:
(i) the weighted average margin of dumping established with respect
to the selected exporters or producers or,
(ii) where the liability for payment of anti dumping duties is
calculated on the basis of a prospective normal value, the difference
between the weighted average normal value of the selected exporters
or producers and the export prices of exporters or producers not
individually examined,
provided
that the authorities shall disregard for the purpose of this
paragraph any zero and de minimis margins and margins
established under the circumstances referred to in paragraph 8
of Article 6. The authorities shall apply individual duties or
normal values to imports from any exporter or producer not included
in the examination who has provided the necessary information during
the course of the investigation, as provided for in subparagraph 10.2
of Article 6.
9.5 If a
product is subject to anti dumping duties in an importing
Member, the authorities shall promptly carry out a review for the
purpose of determining individual margins of dumping for any
exporters or producers in the exporting country in question who have
not exported the product to the importing Member during the period of
investigation, provided that these exporters or producers can show
that (a) they are not related to any of the exporters or
producers in the exporting country who are subject to the
anti dumping duties on the product, and (b) they have engaged
in bona fide sales in commercial quantities into the importing
Member (as evidenced by shipments of the product or by a contract for
sale pursuant to which such shipments will occur within six months of
the date upon which the contract was concluded).
9.5.1 A decision whether or not to initiate a review under this
paragraph shall be taken within three months of receipt of a duly
substantiated request, during which period the authorities may take
such steps as they deem appropriate to verify the accuracy and
adequacy of the information contained in the request. The applicant
and the domestic industry shall be advised of the initiation of any
review and a public notice of the initiation shall also be made. The Such a review shall be initiated and carried out on an accelerated basis, compared to normal duty
assessment and review proceedings in the importing Member, and
shall in any event be concluded within nine months of receipt of a
duly substantiated request.
9.5.2 No anti dumping duties shall be levied on imports
from such exporters or producers while the review is being carried
out. The authorities may, however, withhold appraisement and/or
request guarantees to ensure that, should such a review result in a
determination of dumping in respect of such producers or exporters,
anti dumping duties can be levied retroactively to the date of
the initiation of the review. Upon collection of any such duties
due, the authority shall promptly release any guarantee or bond.
Article 9bis
Circumvention
9bis.1 The
authorities may extend the scope of application of an existing
definitive anti-dumping duty to imports of a product that is not
within the product under consideration from the country subject to
that duty if the authorities determine that such imports take place
in circumstances that constitute circumvention of the existing
anti-dumping duty.
9bis.2 Authorities
may only find circumvention within the meaning of paragraph 1 if they
demonstrate that:
(i) Subsequent to the initiation of the investigation that
resulted in the imposition of the existing definitive anti-dumping
duty, imports of the product under consideration from the country
subject to that duty have been supplanted, in whole or in part:
— by imports from the country subject to the anti-dumping duty
of parts or unfinished forms of a product for assembly or completion
into a product that is the same as the product under consideration;
— by imports of a product that is the same as the product under
consideration and that has been assembled or completed in a third
country from parts or unfinished forms of a product imported from the
country subject to the existing anti-dumping duty; or
— by imports of a slightly modified product from the country subject to the existing anti-dumping duty;
(ii) The principal cause of the change described in subparagraph
2(i) is the existence of the anti-dumping duty on the product under
consideration from the country subject to the duty rather than
economic or commercial factors unrelated to that duty; and
(iii) The imports that have supplanted the imports of the product
under consideration from the country subject to the existing
anti-dumping duty undermine the remedial effect of that duty.
9bis.3 With
respect to imports referred to in 9bis.2
of parts or unfinished forms of a product and imports referred to in
9bis.2 of a product assembled or completed in a third country,
the authorities shall only find circumvention if they establish that
(i) the process of assembly or completion is minor or insignificant and (ii) the cost of the parts or unfinished forms makes up a
significant proportion of the total cost of the assembled or
completed product. The authorities shall in no case find that
circumvention exists unless they determine that the value of the
parts or unfinished forms is 60 per cent of the total value of the
parts or unfinished forms of the assembled or completed product or
more, and that the value added to the parts or unfinished forms
during the assembly or completion process is 25 per cent of the total
cost of manufacture or less.
9bis.4 The
authorities may extend the scope of application of an existing
definitive anti-dumping duty to imports of parts or unfinished forms
of the product under consideration assembled or completed in a third
country only if they find that such imports are dumped pursuant to
Article 2.
9bis.5 A
determination of the existence of circumvention within the meaning of
this Article shall be based on a formal review initiated pursuant to
a duly substantiated request. Except in special circumstances, such
a review shall not be initiated unless the authorities have
determined, on the basis of an examination of the degree of support
for, or opposition to, the request expressed by domestic producers of
the like product that the request has been made by or on behalf of
the domestic industry within the meaning of Article 5.4.
9bis.6 The
provisions regarding evidence and procedure in Article 6 shall apply
to any review carried out under this Article. Any such review shall
be carried out expeditiously and shall normally be concluded within
12 months of the date of initiation of the review.
9bis.7 If
the authorities have determined in accordance with this Article that
circumvention exists, they may apply the anti-dumping duty to the
imported products found to be circumventing the existing definitive
anti-dumping duty,
including retroactively to imports entered after the date of the
initiation of the review.
Article 10
Retroactivity
10.1 Provisional
measures and anti dumping duties shall only be applied to
products which enter for consumption after the time when the decision
taken under paragraph 1 of Article 7 and paragraph 1
of Article 9, respectively, enters into force, subject to the
exceptions set out in this Article.
10.2 Where
a final determination of injury (but not of a threat thereof or of a
material retardation of the establishment of an industry) is made or,
in the case of a final determination of a threat of injury, where the
effect of the dumped imports would, in the absence of the provisional
measures, have led to a determination of injury, anti dumping
duties may be levied retroactively for the period for which
provisional measures, if any, have been applied.
10.3 If
the definitive anti dumping duty is higher than the provisional
duty paid or payable, or the amount estimated for the purpose of the
security, the difference shall not be collected. If the definitive
duty is lower than the provisional duty paid or payable, or the
amount estimated for the purpose of the security, the difference
shall be reimbursed or the duty recalculated, as the case may be.
10.4 Except
as provided in paragraph 2, where a determination of threat of
injury or material retardation is made (but no injury has yet
occurred) a definitive anti dumping duty may be imposed only
from the date of the determination of threat of injury or material
retardation, and any cash deposit made during the period of the
application of provisional measures shall be refunded and any bonds
released in an expeditious manner.
10.5 Where
a final determination is negative, any cash deposit made during the
period of the application of provisional measures shall be refunded
and any bonds released in an expeditious manner.
10.6 A
definitive anti dumping duty may be levied on products which
were entered for consumption not more than 90 days prior to the date
of application of provisional measures, when the authorities
determine for the dumped product in question that:
(i) there is a history of dumping which caused injury or that the
importer was, or should have been, aware that the exporter practises
dumping and that such dumping would cause injury, and
(ii) the injury is caused by massive dumped imports of a product in a
relatively short time which in light of the timing and the volume of
the dumped imports and other circumstances (such as a rapid build up
of inventories of the imported product) is likely to seriously
undermine the remedial effect of the definitive anti dumping
duty to be applied, provided that the importers concerned have been
given an opportunity to comment.
10.7 The
authorities may, after initiating an investigation, take such
measures as the withholding of appraisement or assessment as may be
necessary to collect anti dumping duties retroactively, as
provided for in paragraph 6, once they have sufficient evidence
that the conditions set forth in that paragraph are satisfied.
10.8 No
duties shall be levied retroactively pursuant to paragraph 6 on
products entered for consumption prior to the date of initiation of
the investigation.
10.8bis In
the event that monies paid or deposited are refunded pursuant to
paragraphs 3 or 5 of this Article, the authorities shall pay a
reasonable amount of interest on the monies refunded.
Article 11
Duration and Review of Anti Dumping Duties and Price
Undertakings
11.1 An
anti dumping duty shall remain in force only as long as and to
the extent necessary to counteract dumping which is causing injury.
11.2 The
authorities shall review the need for the continued imposition of the
duty, or for a modification of the level of the duty,
where warranted, on their own initiative or, provided that a
reasonable period of time has elapsed since the imposition of the
definitive anti dumping duty, upon request by any interested
party which submits positive information substantiating the need for
a review. Interested parties shall have the right to request the authorities
to examine whether the continued imposition of the duty is necessary
to offset dumping, whether the injury would be likely to continue or
recur if the duty were removed or varied, or both. Interested
parties may also request a modification in the level of a duty. If,
as a result of the review under this paragraph, the authorities
determine that there has been a change in circumstances of a
lasting nature since the original investigation or the last review under Article
11.2 or 11.3, such that the anti dumping duty is no longer
warranted or the level of the duty applicable to one or more
exporters is no longer appropriate, the duty, it shall be terminated immediately or its level modified.
11.3 Notwithstanding
the provisions of paragraphs 1 and 2, any definitive
anti dumping duty shall be terminated on a date not later than
five years from its imposition (or from the effective date of the most recent review of the duty under this paragraph, or under paragraph 2 if that review has
covered both dumping and injury, or under this paragraph), unless the authorities determine, in a review initiated
before that date on their own initiative or upon a duly substantiated
request made by or on behalf of the domestic industry within a
reasonable period of time prior to that date, that the
expiry of the duty would be likely to lead to continuation or
recurrence of dumping and injury. The duty may remain in force pending the outcome of such a review.
11.3.1 Except in special circumstances, a review under this
paragraph shall be initiated upon a written application by or on
behalf of the domestic industry. Such an application shall contain
information reasonably available to the applicant and shall explain
why, in the view of the applicant, dumping and injury are likely to
continue or recur should the duty expire. The application shall in
particular contain information on the development of the condition of
the domestic industry since the imposition of the anti-dumping duty,
the present condition of the domestic industry and the potential
impact that any continuation or recurrence of dumping could have
thereon if the duty were terminated. The authorities shall determine
whether there is sufficient evidence to warrant a review. In any case, a review shall not be initiated
unless the authorities have determined, on the basis of an
examination of the degree of support for, or opposition to, the
application expressed by domestic producers of the like product, that the application has
been made “by or on behalf” of the domestic industry within
the meaning of Article 5.4.
11.3.2 If in special circumstances, authorities initiate a review
under paragraph 3 in the absence of a written application by or on
behalf of the domestic industry, they shall proceed only if they have
sufficient evidence to warrant an examination as to whether dumping
and injury are likely to continue or recur should the duty expire.
The authorities shall set forth in the relevant public notices
pursuant to Article 12 the special circumstances underlying the
decision to initiate a review in the absence of a written application
by or on behalf of the domestic industry.
11.3.3 A review under paragraph 3 shall be initiated not later
than six months prior to the end of the five year period following
the imposition of the duty or of the five year period following the
most recent review of the anti-dumping duty. The review shall
preferably be completed before the end of that five-year period and
shall in no case be completed later than six months thereafter.
Irrespective of whether a review under paragraph 3 is completed after
the end of that five-year period, the result of the review shall be
effective as of that date. In the event that the review results in
the termination of the duty, the importing Member shall refund any
monies collected in respect of imports occurring after the effective
date of the termination and shall pay a reasonable amount of interest
on such monies.
11.3.4 A determination whether the expiry of an anti-dumping duty
would be likely to lead to continuation or recurrence of dumping and
injury shall be based on positive evidence and involve an objective
examination of all relevant factors. The weight to be accorded to
particular factors will depend upon the facts of each review, and no
one or several factors can necessarily give decisive guidance.
11.3.5 Any anti-dumping duty extended beyond the end of the
initial five year period following a review in accordance with
paragraph 3 shall be terminated on a date not later than ten years
after the date of the imposition of the anti-dumping duty.
11.3.6 If during a period not longer than two years from the date
of termination of an anti-dumping duty pursuant to sub-paragraph 3.5,
the authorities initiate an investigation pursuant to Article 5 on
the basis of an application containing sufficient evidence of
dumping, injury and causal link pursuant to Article 5.3, the
authorities of the importing Member may take, under this Agreement in
conformity with its provisions, expeditious actions which may
constitute immediate application of provisional measures using the
best information available. In such cases, definitive duties may be
levied in accordance with this Agreement on products entered for
consumption not more than 90 days before the application of such
provisional measures, except that any such retroactive assessment
shall not apply to imports entered before the date of termination of
the anti-dumping duty.
11.4 The
provisions of Article 6 regarding evidence and procedure shall
apply to any review carried out under this Article. Any such review
shall be carried out expeditiously and shall normally be concluded
within 12 months of the date of initiation of the review.
11.5 The
provisions of this Article shall apply mutatis mutandis to price undertakings accepted under Article 8.
Article 12
Public Notice and Explanation of Determinations
12.1 When
the authorities are satisfied that there is sufficient evidence to
justify the initiation of an anti dumping investigation pursuant
to Article 5, the Member or Members the products of which are
subject to such investigation and other interested parties known to
the investigating authorities to have an interest therein shall be
notified and a public notice shall be given.
12.1.1 A public notice of the initiation of an investigation shall
contain, or otherwise make available through a separate report,
adequate information on the following:
(i) a description of the product under consideration, including
its tariff classification for customs purposes, the name of the
exporting country or countries, and the names of the known
exporters and foreign producers of the productproduct
involved;
(ii) the domestic like product and the domestic industry,
including whether any domestic producers were excluded from the
domestic industry, and the names of the applicant and of the domestic
producers of the like product (or, if relevant, associations of
producers) supporting the application and of other domestic producers
of the like product insofar as they are known to the investigating
authorities;
(iii) the procedural background of the investigation, including
the date on which the application was received and the date of
initiation of the investigation;
(ivii) the basis on which dumping is
alleged in the application;
(iv) a summary of the factors on which the
allegation of injury is based;
(vi) whether the authorities may consider limiting their
examination in accordance with paragraph 10 of Article 6 and any
procedures in that respect; and
(vii) next steps in the process, related time frames,
periods of data collection and a contact to whom the
address to which representations by interested parties
should be directed;
(vi) the time limits allowed to interested parties for
making their views known.
12.2 Public
notice shall be given of any preliminary or final determination,
whether affirmative or negative, of any decision to accept an
undertaking pursuant to Article 8, of the termination of such an
undertaking, and of the termination of a definitive anti dumping
duty. Each such notice shall set forth, or otherwise make available
through a separate report, in sufficient detail the findings and
conclusions reached on all issues of fact and law considered material
by the investigating authorities. All such notices and reports shall
be forwarded to the Member or Members the products of which are
subject to such determination or undertaking and to other interested
parties known to have an interest therein.
12.2.1 A public notice of the imposition of provisional measures
shall set forth, or otherwise make available through a separate
report, sufficiently detailed explanations of the analysis
underlying for the preliminary determinations on
dumping and injury and shall refer to the matters of fact and law
which have led to arguments being accepted or rejected. Such a
notice or report shall, due regard being paid to the requirement for
the protection of confidential information, contain in particular:
(i) the names of the suppliers, or when this is
impracticable, the supplying countries involved;
(ii) a description of the product under
consideration, including its tariff classification which
is sufficient for customs purposes, the name of the
exporting country or countries, and the names of the known exporters
and foreign producers of the product under consideration;
(ii) information concerning the domestic like product and the
domestic industry, including the names of all known domestic
producers of the like product;
(iii) the periods of data collection for both the preliminary
dumping and preliminary injury analysis, and the basis for the
selection of such periods;
(ivii) the margins of dumping established
and information concerning the calculation of the margins of
dumping, including ana full explanation of the basis upon which normal values were established (sales in the home
market, sales to a third market or constructed normal value), the
basis upon which export prices were established (including, if
appropriate, the adjustments related to the construction of export
price), and reasons for the methodology used in
the establishment and comparison of normal values
and the export prices (including any
adjustments made to reflect differences affecting price
comparability)and the normal value under Article 2;
(iv) considerations information relevant to the injury determination as set out in Article 3,
including information concerning the domestic market for the subject
imports and the like product, the volume and the price effects of the
subject imports, the consequent impact of the subject imports on the
domestic industry and, if relevant, the factors leading to a
conclusion of threat of material injury or material retardation of
the establishment of a domestic industry;
(vi) information concerning any use of full or partial facts
available, including, where applicable, the reasons why information
submitted by a party was rejected;
(vii) information concerning the on-the-spot verification of
information used by the authorities, if undertaken;
(viii) information on any provisional measures being imposed,
including the form, level, and duration of such measures; and
(ix) information concerning next steps in the process, and
related time frames, and information concerning a contact to whom
representations by interested parties should be directed(v)
the main reasons leading to the determination.
12.2.2 A public notice of conclusion or suspension of an
investigation in the case of an affirmative determination providing
for the imposition of a definitive duty or the acceptance of a price
undertaking shall contain, or otherwise make available through a
separate report, all relevant information on the matters of fact and
law and reasons which have led to the imposition of final measures or
the acceptance of a price undertaking, due regard being paid to the
requirement for the protection of confidential information. In
particular, the notice or report shall contain the information
described in subparagraph 2.1, to the extent applicable, as
well as the reasons for the acceptance or rejection of relevant
arguments or claims made by the exporters, foreign producers and importers, and the basis for any decision made under
subparagraph 10.2 of Article 6.
12.2.3 A public notice of the termination or suspension of an
investigation following the acceptance of an undertaking pursuant to
Article 8 shall include, or otherwise make available through a
separate report, the non confidential part of this undertaking.
12.3 The
provisions of this Article shall apply mutatis mutandis to proceedings conducted pursuant to Articles 9.1, 9.3 and 9.5, to decisions under Article 10 to apply duties retroactively and to
the initiation and completion of reviews pursuant to Articles 9bis and 11 and to decisions under Article 10 to
apply duties retroactively.
Article 13
Judicial Review
Each
Member whose national legislation contains provisions on
anti dumping measures shall maintain judicial, arbitral or
administrative tribunals or procedures for the purpose, inter alia,
of the prompt review of administrative actions relating to final
determinations and reviews of determinations within the meaning of
Article 11. Such tribunals or procedures shall be independent
of the authorities responsible for the determination or review in
question.
Article 14
Anti Dumping Action on Behalf of a Third Country
14.1 An
application for anti dumping action on behalf of a third country
shall be made by the authorities of the third country requesting
action.
14.2 Such
an application shall be supported by price information to show that
the imports are being dumped and by detailed information to show that
the alleged dumping is causing injury to the domestic industry
concerned in the third country. The government of the third country
shall afford all assistance to the authorities of the importing
country to obtain any further information which the latter may
require.
14.3 In
considering such an application, the authorities of the importing
country shall consider the effects of the alleged dumping on the
industry concerned as a whole in the third country; that is to say,
the injury shall not be assessed in relation only to the effect of
the alleged dumping on the industry's exports to the importing
country or even on the industry's total exports.
14.4 Notwithstanding
the provisions of Article VI:6(b) of GATT 1994, Tthe
decision whether or not to proceed with a case shall rest solely with the importing country; provided, that If the importing country decides that it is prepared to take
action, the initiation of the approach to shall notify the Council for Trade in Goods of its decision to initiate
such an investigationseeking its
approval for such action shall rest with the importing country.
Article 15
Developing Country Members
It is
recognized that special regard must be given by developed country
Members to the special situation of developing country Members when
considering the application of anti dumping measures under this
Agreement. Possibilities of constructive remedies provided for by
this Agreement shall be explored before applying anti dumping
duties where they would affect the essential interests of developing
country Members.
PART II
Article 16
Committee on Anti Dumping Practices
16.1 There
is hereby established a Committee on Anti Dumping Practices
(referred to in this Agreement as the “Committee”) composed
of representatives from each of the Members. The Committee shall
elect its own Chairman and shall meet not less than twice a year and
otherwise as envisaged by relevant provisions of this Agreement at
the request of any Member. The Committee shall carry out
responsibilities as assigned to it under this Agreement or by the
Members and it shall afford Members the opportunity of consulting on
any matters relating to the operation of the Agreement or the
furtherance of its objectives. The WTO Secretariat shall act as the
secretariat to the Committee.
16.2 The
Committee may set up subsidiary bodies as appropriate.
16.3 In
carrying out their functions, the Committee and any subsidiary bodies
may consult with and seek information from any source they deem
appropriate. However, before the Committee or a subsidiary body
seeks such information from a source within the jurisdiction of a
Member, it shall inform the Member involved. It shall obtain the
consent of the Member and any firm to be consulted.
16.4 Members
shall report without delay to the Committee all preliminary or final
anti dumping actions taken. Such reports shall be available in
the Secretariat for inspection by other Members. Members shall also
submit, on a semi annual basis, reports of any anti dumping
actions taken within the preceding six months, and a list of
definitive measures in force as of the end of that period. The
semi-annual reports shall be submitted on an agreed standard form.
16.5 Each
Member shall notify the Committee (a) which of its authorities
are competent to initiate and conduct investigations referred to in
Article 5 and (b) its domestic procedures governing the
initiation and conduct of such investigations.
Article 17
Consultation and Dispute Settlement
17.1 Except as otherwise provided herein, the Dispute Settlement
Understanding is applicable to consultations and the settlement of
disputes under this Agreement.
17.2 Each
Member shall afford sympathetic consideration to, and shall afford
adequate opportunity for consultation regarding, representations made
by another Member with respect to any matter affecting the operation
of this Agreement.
17.3 If
any Member considers that any benefit accruing to it, directly or
indirectly, under this Agreement is being nullified or impaired, or
that the achievement of any objective is being impeded, by another
Member or Members, it may, with a view to reaching a mutually
satisfactory resolution of the matter, request in writing
consultations with the Member or Members in question. Each Member
shall afford sympathetic consideration to any request from another
Member for consultation.
17.4 If
the Member that requested consultations considers that the
consultations pursuant to paragraph 3 have failed to achieve a
mutually agreed solution, and if final action has been taken by the
administering authorities of the importing Member to levy definitive
anti dumping duties or to accept price undertakings, it may
refer the matter to the Dispute Settlement Body (“DSB”).
When a provisional measure has a significant impact and the Member
that requested consultations considers that the measure was taken
contrary to the provisions of paragraph 1 of Article 7,
that Member may also refer such matter to the DSB.
17.5 The
DSB shall, at the request of the complaining party, establish a panel
to examine the matter based upon:
(i) a written statement of the Member making the request indicating
how a benefit accruing to it, directly or indirectly, under this
Agreement has been nullified or impaired, or that the achieving of
the objectives of the Agreement is being impeded, and
(ii) the facts made available in conformity with appropriate domestic
procedures to the authorities of the importing Member.
17.6 In
examining the matter referred to in paragraph 5:
(i) in its assessment of the facts of the matter, the panel shall
determine whether the authorities' establishment of the facts was
proper and whether their evaluation of those facts was unbiased and
objective. If the establishment of the facts was proper and the
evaluation was unbiased and objective, even though the panel might
have reached a different conclusion, the evaluation shall not be
overturned;
(ii) the panel shall interpret the relevant provisions of the
Agreement in accordance with customary rules of interpretation of
public international law. Where the panel finds that a relevant
provision of the Agreement admits of more than one permissible
interpretation, the panel shall find the authorities' measure to be
in conformity with the Agreement if it rests upon one of those
permissible interpretations.
17.7 Confidential
information provided to the panel shall not be disclosed without
formal authorization from the person, body or authority providing
such information. Where such information is requested from the panel
but release of such information by the panel is not authorized, a
non confidential summary of the information, authorized by the
person, body or authority providing the information, shall be
provided.
PART III
Article 18
Final Provisions
18.1 No
specific action against dumping of exports from another Member can be
taken except in accordance with the provisions of GATT 1994, as
interpreted by this Agreement.
18.2 Reservations
may not be entered in respect of any of the provisions of this
Agreement without the consent of the other Members.
18.3 Subject
to subparagraphs 3.1 and 3.2, the provisions of this Agreement shall
apply to investigations, and reviews of existing measures, initiated
pursuant to applications which have been made on or after the date of
entry into force for a Member of the WTO Agreement.
18.3.1 With respect to the calculation of margins of dumping in
refund procedures under paragraph 3 of Article 9, the rules used in
the most recent determination or review of dumping shall apply.
18.3.2 For the purposes of paragraph 3 of Article 11, existing
anti dumping measures shall be deemed to be imposed on a date
not later than the date of entry into force for a Member of the WTO
Agreement, except in cases in which the domestic legislation of a
Member in force on that date already included a clause of the type
provided for in that paragraph.
18.3bis Subject
to subparagraph 3.1bis, the results of the DDA shall apply to
investigations, and reviews of existing measures, initiated pursuant
to applications which have been made on or after the date of entry
into force of those results or, where an investigation or review is
initiated by the authorities without those authorities having
received an application, the investigation or review was initiated on
or after the date of entry into force of those results.
18.3.1bis For the purpose of Article
11.3.5, anti-dumping measures in existence as of the date of entry
into force of the results of the DDA shall be deemed to be imposed on
that date.
18.4 Each
Member shall take all necessary steps, of a general or particular
character, to ensure, not later than the date of entry into force of
the WTO Agreement for it, the conformity of its laws, regulations and
administrative procedures with the provisions of this Agreement as
they may apply for the Member in question.
18.5 Each
Member shall inform the Committee of any changes in its laws and
regulations relevant to this Agreement and in the administration of
such laws and regulations.
18.6 The
Committee shall review annually the implementation and operation of
this Agreement taking into account the objectives thereof. The
Committee shall inform annually the Council for Trade in Goods of
developments during the period covered by such reviews. In
addition, the Committee shall review the anti-dumping policy and
practices of individual Members according to the schedule and
procedures set forth in Annex III.
18.7 The
Annexes to this Agreement constitute an integral part thereof.
ANNEX I
PROCEDURES FOR ON THE SPOT INVESTIGATIONS PURSUANT
TO PARAGRAPH 7 OF ARTICLE 6
1. Upon
initiation of an investigation, the authorities of the exporting
Member and the firms known to be concerned should shall be informed of the intention to carry out on the spot
investigations.
2. If in
exceptional circumstances it is intended to include non governmental
experts in the investigating team, the firms and the authorities of
the exporting Member shallshould be so
informed. Such non governmental experts shallshould be subject to effective sanctions for breach of confidentiality
requirements.
3. It shall should be standard practice to obtain
explicit agreement of the firms concerned in the exporting Member
before the visit is finally scheduled.
4. As soon
as the agreement of the firms concerned has been obtained, the
investigating authorities shallshould notify
the authorities of the exporting Member of the names and addresses of
the firms to be visited and the dates agreed.
5. Sufficient
advance notice shallshould be given to the
firms in question before the visit is made. To afford the firms
adequate opportunity to prepare for on-the-spot investigations, the
investigating authorities shall provide each firm at least 21 days
advance notice of the dates on which the authorities intend to
conduct any on-the-spot investigation of the information provided by
that firm.
6. Visits
to explain the questionnaire shallshould only
be made at the request of an exporting firm. Such a visit may only
be made if (a) the authorities of the importing Member notify
the representatives of the Member in question and (b) the
latter do not object to the visit.
7. As the
main purpose of the on the spot investigation is to verify
information provided or to obtain further details, it shall should be carried out after the response to the questionnaire has been
received unless the firm agrees to the contrary and the government of
the exporting Member is informed by the investigating authorities of
the anticipated visit and does not object to it.
7bis No
less than 10 days prior to each on-the-spot investigation, the
investigating authorities shall provide to the firm a document that
sets forth the topics the firm should be prepared to address during
the on-the-spot investigation, and describes the types of supporting
documentation that shall be made available for review. ;
further, it should be standard practice prior to the visit to advise
the firms concerned of the general nature of the information to be
verified and of any further information which needs to be provided,
though tThis shallshould not
preclude requests to be made on the spot for further details to be
provided in the light of information obtained.
8. Enquiries
or questions put by the authorities or firms of the exporting Members
and essential to a successful on the spot investigation shallshould, whenever possible, be answered
before the visit is made.
9. The
investigating authorities shall disclose in the form of a written
report their factual findings resulting from the on-the-spot
investigation. In addition to the factual findings, the report shall
describe the methods and procedures followed in carrying out the
on-the-spot investigation. The report shall be made available to all
interested parties in sufficient time for the parties to defend their
interests, subject to the requirement to protect confidential
information.
ANNEX II
BEST INFORMATION AVAILABLE IN TERMS OF PARAGRAPH 8 OF ARTICLE 6
1. As soon
as possible after the initiation of the investigation, the
investigating authorities should shall specify
in detail the information required from any interested party, and the
manner in which that information should be structured by the
interested party in its response. The authorities shall should also ensure that the party is aware that if information is not
supplied within a reasonable time, the authorities will be
free to may make determinations on the basis of the
facts available, including those contained in the application for the
initiation of the investigation by the domestic industry.
2. The
authorities may also request that an interested party provide its
response in a particular medium (e.g. computer tape) or computer
language. Where such a request is made, the authorities shallshould consider the reasonable ability of the interested party to respond in
the preferred medium or computer language, and shall should not request the party to use for its response a computer
system other than that used by the party. The authorityies should shall not maintain a request for a
computerized response if the interested party does not maintain
computerized accounts and if presenting the response as requested
would result in an unreasonable extra burden on the interested party,
e.g. it would entail unreasonable additional cost and trouble. The
authorities should shall not maintain a
request for a response in a particular medium or computer language if
the interested party does not maintain its computerized accounts in
such medium or computer language and if presenting the response as
requested would result in an unreasonable extra burden on the
interested party, e.g. it would entail unreasonable additional cost
and trouble.
3. All
information which is verifiable, which is appropriately submitted so
that it can be used in the investigation without undue difficulties,
which is supplied in a timely fashion, and, where applicable, which
is supplied in a medium or computer language requested by the
authorities, should shall be taken into
account when determinations are made. If a party does not respond in
the preferred medium or computer language but the authorities find
that the circumstances set out in paragraph 2 have been
satisfied, the failure to respond in the preferred medium or computer
language should shall not be considered to
significantly impede the investigation.
4. Where
the authorities do not have the ability to process information if
provided in a particular medium (e.g. computer tape), the information should shall be supplied in the form of
written material or any other form acceptable to the authorities.
5. Even
though the information provided may not be ideal in all respects,
this should shall not justify the authorities
from disregarding it, provided the interested party has acted to the
best of its ability.
6. If
evidence or information is not accepted, the supplying party should shall be informed forthwith of the reasons therefor, and should shall have an opportunity to submit
further evidence or information, or to provide further
explanations, within a reasonable period, due account being
taken of the time limits of the investigation.
If the further evidence or information submitted, or the explanations provided, are considered by the authorities as
not being satisfactory, the authorities shall inform the
interested party concerned of the reasons for the rejection of such the evidence or information and should shall set forth such reasons be
given in any published determinations.
7. If the
authorities have to base their findings, including those with respect
to normal value, on information from a secondary source, including
the information supplied in the application for the initiation of the
investigation, they should shall do so with
special circumspection. In such cases, the authorities should shall, where practicable, check the information from other
independent sources at their disposal or reasonably available to
them, such as published price lists, official import statistics
and customs returns, and from the information obtained from other
interested parties during the investigation.
It is clear, however, that if an interested party does not cooperate
and thus relevant information is being withheld from the authorities,
this situation could lead to a result which is less favourable to the
party than if the party did cooperate.
ANNEX III
PROCEDURES FOR THE REVIEW OF MEMBERS'
ANTI-DUMPING POLICY AND PRACTICES PURSUANT TO ARTICLE 18.5
1. The
anti-dumping policy and practices of Members shall be subject to
periodic review by the Committee.
A. Objectives
2. The
purpose of the review is to contribute to the transparency and
understanding of Members' policies and practices in respect of
anti-dumping. The review is not intended to serve as the basis for
enforcement of specific obligations under this Agreement or for
dispute settlement procedures, or to impose new policy commitments on
Members.
B. Procedures for Review
3. The
review shall be conducted on the basis of the following
documentation:
(a) a factual report, to be drawn up by the Secretariat on its
own responsibility; and
(b) if the Member under review so wishes, a report supplied by
that Member.
4. The
factual report by the Secretariat shall be based on the information
available to it and that provided by the Member under review. The
Secretariat should seek clarification from such Member regarding its
anti-dumping policies and practices making use of the indicative
checklist identified in paragraph 8 of this Annex. The Member under
review shall provide the information requested for the preparation of
the report.
5. The
first cycle of reviews shall begin one year after the date of entry
into force of the results of the Doha Development Agenda. During
the ensuing five years, the Committee shall review the anti-dumping
policies and practices of the 20 Members with the most anti-dumping
measures in force as of the date of entry into force.
6. The
list of the Members to be reviewed during each subsequent five-year
review period shall be established on the basis of the number of
original investigations initiated during the most recent five-year
period for which information is available. The list shall include
the 20 Members that initiated the most investigations pursuant to
Article 5 during that period, as well as any additional Members that
have initiated five or more original investigations during that
period; provided, that the Committee may adjust the list of Members
to be reviewed and/or the cycle for review in light of subsequent
developments and experience.
7. The
Committee shall agree on the order of, and schedule for, the conduct
of these reviews, taking into account the resource constraints of the
Secretariat and of developing country Members.
8. The
factual report of the Secretariat shall describe in detail the
anti-dumping policy and practices of the Member under review
including, where relevant and applicable, with respect to the
following matters:
-
institutional
organization of the investigating authorities
-
statistics
on proceedings carried-out
-
pre-initiation
procedures and practices
-
determination
of export price and normal value (and adjustments thereto)
-
details
of comparison methods
-
calculation
of dumping margin
-
details
and methodology of analysis and determination of injury and causal
link
-
application
of a lesser duty
-
application
of public interest considerations
-
level
of co-operation obtained
-
use
of facts available
-
procedural
requirements
-
treatment
of confidential information
-
practice
with regard to on-the-spot verifications
-
duty
collection and assessment system
-
acceptance
of undertakings
-
review
investigations (under Articles 9 and 11)
-
anti-circumvention
procedures
-
judicial/administrative
review
9. The
report by the Secretariat and any report by the Member subject to
review shall be circulated to the Members on an unrestricted basis,
and shall be considered at a special meeting of the Committee
convened for that purpose.
10. Members
recognize the need to minimize the burden for governments that might
arise from unnecessary duplication of work pursuant to this procedure
and the Trade Policy Review Mechanism.
C. Developing Country Members
11. The
Secretariat shall make technical assistance available, on request of
a developing country Member, to facilitate that Member's effective
participation in the review. The Secretariat shall also consult with
the developing country Member subject to review and shall, where
appropriate, include in its report to the Committee an assessment of
that Member's broader technical assistance and resource needs with
respect to anti-dumping.
D. Appraisal of the Mechanism
12. The
Committee shall undertake an appraisal of the operation of these
procedures upon completion of the first cycle of reviews. The
Committee should seek to identify any changes which would enhance the
operation of these procedures, and may, if appropriate, recommend
that the Council for Trade in Goods submit to the Ministerial
Conference any proposals for the amendment of these procedures
necessary to effectuate such changes.
_______________
AGREEMENT ON SUBSIDIES AND COUNTERVAILING MEASURES
Members hereby agree as follows:
PART I: GENERAL PROVISIONS
Article 1
Definition of a Subsidy
1.1 For
the purpose of this Agreement, a subsidy shall be deemed to exist if:
(a)(1) there is a financial contribution by a government or any
public body within the territory of a Member (referred to in this
Agreement as “government”), i.e. where:
(i) a government practice involves a direct transfer of funds (e.g.
grants, loans, and equity infusion), potential direct transfers of
funds or liabilities (e.g. loan guarantees);
(ii) government revenue that is otherwise due is foregone or not
collected (e.g. fiscal incentives such as tax credits) ;
(iii) a government provides goods or services other than general
infrastructure, or purchases goods;
(iv) a government makes payments to a funding mechanism, or entrusts
or directs a private body to carry out one or more of the type of
functions illustrated in (i) to (iii) above which would normally be
vested in the government and the practice, in no real sense, differs
from practices normally followed by governments;
or
(a)(2) there is any form of income or price support in the sense of
Article XVI of GATT 1994;
and
(b) a benefit is thereby conferred.
1.2 A subsidy as defined in paragraph 1 shall be subject to the
provisions of Part II or shall be subject to the provisions of
Part III or V only if such a subsidy is specific in
accordance with the provisions of Article 2.
Article 2
Specificity
2.1 In
order to determine whether a subsidy, as defined in paragraph 1
of Article 1, is specific to an enterprise or industry or group of
enterprises or industries (referred to in this Agreement as “certain
enterprises”) within the jurisdiction of the granting authority,
the following principles shall apply:
(a) Where the granting authority, or the legislation pursuant to
which the granting authority operates, explicitly limits access to a
subsidy to certain enterprises, such subsidy shall be specific.
(b) Where the granting authority, or the legislation pursuant to
which the granting authority operates, establishes objective criteria
or conditions governing the eligibility for, and the amount of, a subsidy,
specificity shall not exist, provided that the eligibility is
automatic and that such criteria and conditions are strictly adhered
to. The criteria or conditions must be clearly spelled out in law,
regulation, or other official document, so as to be capable of
verification.
(c) If, notwithstanding any appearance of non specificity
resulting from the application of the principles laid down in
subparagraphs (a) and (b), there are reasons to believe that the
subsidy may in fact be specific, other factors may be considered.
Such factors are: use of a subsidy programme by a limited number of
certain enterprises, predominant use by certain enterprises, the
granting of disproportionately large amounts of subsidy to certain
enterprises, and the manner in which discretion has been exercised by
the granting authority in the decision to grant a subsidy. In the case of subsidies conferred through the provision of goods
or services at regulated prices, factors that may be considered
include the exclusion of firms within the country in question from
access to the goods or services at the regulated prices. In
applying this subparagraph, account shall be taken of the extent of
diversification of economic activities within the jurisdiction of the
granting authority, as well as of the length of time during which the
subsidy programme has been in operation.
2.2 A
subsidy which is limited to certain enterprises located within a
designated geographical region within the jurisdiction of the
granting authority shall be specific. It is understood that the
setting or change of generally applicable tax rates by all levels of
government entitled to do so shall not be deemed to be a specific
subsidy for the purposes of this Agreement.
2.3 Any
subsidy falling under the provisions of paragraphs 1(a) or 1(b) of Article 3 shall be deemed to be specific.
2.4 Any
determination of specificity under the provisions of this Article
shall be clearly substantiated on the basis of positive evidence.
PART II: PROHIBITED SUBSIDIES
Article 3
Prohibition
3.1 Except
as provided in the Agreement on Agriculture, the following subsidies,
within the meaning of Article 1, shall be prohibited:
(a) subsidies contingent, in law or in fact,
whether solely or as one of several other conditions, upon export
performance, including those illustrated in Annex I;
(b) subsidies contingent, whether solely or as one of several other
conditions, upon the use of domestic over imported goods.;
(c) subsidies referred to in Article I of Annex VIII.
3.2 A
Member shall neither grant nor maintain subsidies referred to in
paragraph 1.
Article 4
Remedies
4.1 Whenever
a Member has reason to believe that a prohibited subsidy is being
granted or maintained by another Member, such Member may request
consultations with such other Member.
4.2 A
request for consultations under paragraph 1 shall include a statement
of available evidence with regard to the existence and nature of the
subsidy in question.
4.3 Upon
request for consultations under paragraph 1, the Member believed
to be granting or maintaining the subsidy in question shall enter
into such consultations as quickly as possible. The purpose of the
consultations shall be to clarify the facts of the situation and to
arrive at a mutually agreed solution.
4.4 If no
mutually agreed solution has been reached within 30 days of the request for consultations, any Member party to such
consultations may refer the matter to the Dispute Settlement Body
(“DSB”) for the immediate establishment of a panel, unless
the DSB decides by consensus not to establish a panel.
4.5 Upon
its establishment, the panel may request the assistance of the
Permanent Group of Experts (referred to in this Agreement as the “PGE”) with regard to
whether the measure in question is a prohibited subsidy. If so
requested, the PGE shall immediately review the evidence with regard
to the existence and nature of the measure in question and shall
provide an opportunity for the Member applying or maintaining the
measure to demonstrate that the measure in question is not a
prohibited subsidy. The PGE shall report its conclusions to the
panel within a time limit determined by the panel. The PGE's
conclusions on the issue of whether or not the measure in question is
a prohibited subsidy shall be accepted by the panel without
modification.
4.6 The
panel shall submit its final report to the parties to the dispute.
The report shall be circulated to all Members within 90 days of
the date of the composition and the establishment of the panel's
terms of reference.
4.7 If the
measure in question is found to be a prohibited subsidy, the panel
shall recommend that the subsidizing Member withdraw the subsidy
without delay. In this regard, the panel shall specify in its
recommendation the time period within which the measure must be
withdrawn.
4.8 Within
30 days of the issuance of the panel's report to all Members, the
report shall be adopted by the DSB unless one of the parties to the
dispute formally notifies the DSB of its decision to appeal or the
DSB decides by consensus not to adopt the report.
4.9 Where
a panel report is appealed, the Appellate Body shall issue its
decision within 30 days from the date when the party to the dispute
formally notifies its intention to appeal. When the Appellate Body
considers that it cannot provide its report within 30 days, it shall
inform the DSB in writing of the reasons for the delay together with
an estimate of the period within which it will submit its report. In
no case shall the proceedings exceed 60 days. The appellate report
shall be adopted by the DSB and unconditionally accepted by the
parties to the dispute unless the DSB decides by consensus not to
adopt the appellate report within 20 days following its issuance to
the Members.
4.10 In
the event the recommendation of the DSB is not followed within the
time period specified by the panel, which shall commence from
the date of adoption of the panel’s report or the Appellate
Body’s report, the DSB shall grant authorization to the
complaining Member to take appropriate countermeasures, unless the DSB decides by consensus to reject the
request.
4.11 In
the event a party to the dispute requests arbitration under paragraph
6 of Article 22 of the Dispute Settlement Understanding (“DSU”),
the arbitrator shall determine whether the countermeasures are
appropriate.
4.12 For
purposes of disputes conducted pursuant to this Article, except for
time periods specifically prescribed in this Article,
time periods applicable under the DSU for the conduct of such
disputes shall be half the time prescribed therein.
PART III: ACTIONABLE SUBSIDIES
Article 5
Adverse Effects
No Member
should cause, through the use of any subsidy referred to in
paragraphs 1 and 2 of Article 1, adverse effects to the
interests of other Members, i.e.:
(a) injury to the domestic industry of another Member;
(b) nullification or impairment of benefits accruing directly or
indirectly to other Members under GATT 1994 in particular the
benefits of concessions bound under Article II of GATT 1994;
(c) serious prejudice to the interests of another Member.
This
Article does not apply to subsidies maintained on agricultural
products as provided in Article 13 of the Agreement on Agriculture.
Article 6
Serious Prejudice
6.1 Serious
prejudice in the sense of paragraph (c) of Article 5 shall be
deemed to exist in the case of:
(a) the total ad valorem subsidization of a product exceeding 5 per cent;
(b) subsidies to cover operating losses sustained by an industry;
(c) subsidies to cover operating losses sustained by an enterprise,
other than one time measures which are non recurrent and
cannot be repeated for that enterprise and which are given merely to
provide time for the development of long term solutions and to
avoid acute social problems;
(d) direct forgiveness of debt, i.e. forgiveness of government held
debt, and grants to cover debt repayment.
6.2 Notwithstanding
the provisions of paragraph 1, serious prejudice shall not be
found if the subsidizing Member demonstrates that the subsidy in
question has not resulted in any of the effects enumerated in
paragraph 3.
6.3 Serious
prejudice in the sense of paragraph (c) of Article 5 may
arise in any case where one or several of the following apply:
(a) the effect of the subsidy is to displace or impede the imports of
a like product of another Member into the market of the subsidizing
Member;
(b) the effect of the subsidy is to displace or impede the exports of
a like product of another Member from a third country market;
(c) the effect of the subsidy is a significant price undercutting by
the subsidized product as compared with the price of a like product
of another Member in the same market or significant price
suppression, price depression or lost sales in the same market;
(d) the effect of the subsidy is an increase in the world market
share of the subsidizing Member in a particular subsidized primary
product or commodity as compared to the average share it had during the previous period of
three years and this increase follows a consistent trend over a
period when subsidies have been granted.
6.4 For
the purpose of paragraphs 3(a) and 3(b), the displacement or
impeding of imports or exports, respectively, shall
include any case in which, subject to the provisions of paragraph 7,
it has been demonstrated that there has been a change in relative
shares of the market to the disadvantage of the non subsidized
like product (over an appropriately representative period sufficient
to demonstrate clear trends in the development of the market for the
product concerned, which, in normal circumstances, shall be at least
one year). “Change in relative shares of the market” shall
include any of the following situations: (a) there is an
increase in the market share of the subsidized product; (b) the
market share of the subsidized product remains constant in
circumstances in which, in the absence of the subsidy, it would have
declined; (c) the market share of the subsidized
product declines, but at a slower rate than would have been the case
in the absence of the subsidy.
6.5 For
the purpose of paragraph 3(c), price undercutting shall include any
case in which such price undercutting has been demonstrated through a
comparison of prices of the subsidized product with prices of a
non subsidized like product supplied to the same market. The
comparison shall be made at the same level of trade and at comparable
times, due account being taken of any other factor affecting price
comparability. However, if such a direct comparison is not possible,
the existence of price undercutting may be demonstrated on the basis
of export unit values.
6.6 Each
Member in the market of which serious prejudice is alleged to have
arisen shall, subject to the provisions of paragraph 3 of
Annex V, make available to the parties to a dispute arising
under Article 7, and to the panel established pursuant to
paragraph 4 of Article 7, all relevant information that can
be obtained as to the changes in market shares of the parties to the
dispute as well as concerning prices of the products involved.
6.7 Displacement
or impediment resulting in serious prejudice shall not arise under
paragraph 3 where any of the following circumstances exist during the relevant period:
(a) prohibition or restriction on exports of the like product from
the complaining Member or on imports from the complaining Member into
the third country market concerned;
(b) decision by an importing government operating a monopoly of trade
or state trading in the product concerned to shift, for
non commercial reasons, imports from the complaining Member to
another country or countries;
(c) natural disasters, strikes, transport disruptions or other force
majeure substantially affecting production, qualities, quantities
or prices of the product available for export from the complaining
Member;
(d) existence of arrangements limiting exports from the complaining
Member;
(e) voluntary decrease in the availability for export of the product
concerned from the complaining Member (including, inter alia,
a situation where firms in the complaining Member have been
autonomously reallocating exports of this product to new markets);
(f) failure to conform to standards and other regulatory requirements
in the importing country.
6.8 In the
absence of circumstances referred to in paragraph 7, the
existence of serious prejudice should be determined on the basis of
the information submitted to or obtained by the panel, including
information submitted in accordance with the provisions of Annex V.
6.9 This
Article does not apply to subsidies maintained on agricultural
products as provided in Article 13 of the Agreement on
Agriculture.
Article 7
Remedies
7.1 Except
as provided in Article 13 of the Agreement on Agriculture, whenever a
Member has reason to believe that any subsidy referred to in
Article 1, granted or maintained by another Member, results in
injury to its domestic industry, nullification or impairment or
serious prejudice, such Member may request consultations with such
other Member.
7.2 A
request for consultations under paragraph 1 shall include a
statement of available evidence with regard to (a) the
existence and nature of the subsidy in question, and (b) the
injury caused to the domestic industry, or the nullification or
impairment, or serious prejudice caused to the interests of the Member requesting consultations.
7.3 Upon
request for consultations under paragraph 1, the Member believed
to be granting or maintaining the subsidy practice in question shall
enter into such consultations as quickly as possible. The purpose of
the consultations shall be to clarify the facts of the situation and
to arrive at a mutually agreed solution.
7.4 If
consultations do not result in a mutually agreed solution within 60
days,
any Member party to such consultations may refer the matter to the
DSB for the establishment of a panel, unless the DSB decides by
consensus not to establish a panel. The composition of the panel and
its terms of reference shall be established within 15 days from the
date when it is established.
7.5 The
panel shall review the matter and shall submit its final report to
the parties to the dispute. The report shall be circulated to all
Members within 120 days of the date of the composition and
establishment of the panel’s terms of reference.
7.6 Within
30 days of the issuance of the panel’s report to all Members,
the report shall be adopted by the DSB unless one of the parties to the dispute formally notifies the DSB of
its decision to appeal or the DSB decides by consensus not to adopt
the report.
7.7 Where
a panel report is appealed, the Appellate Body shall issue its
decision within 60 days from the date when the party to the dispute
formally notifies its intention to appeal. When the Appellate Body
considers that it cannot provide its report within 60 days, it shall
inform the DSB in writing of the reasons for the delay together with
an estimate of the period within which it will submit its report. In
no case shall the proceedings exceed 90 days. The appellate report
shall be adopted by the DSB and unconditionally accepted by the
parties to the dispute unless the DSB decides by consensus not to
adopt the appellate report within 20 days following its issuance to
the Members.
7.8 Where
a panel report or an Appellate Body report is adopted in which it is
determined that any subsidy has resulted in adverse effects to the
interests of another Member within the meaning of Article 5, the
Member granting or maintaining such subsidy shall take appropriate
steps to remove the adverse effects or shall withdraw the subsidy.
7.9 In the
event the Member has not taken appropriate steps to remove the
adverse effects of the subsidy or withdraw the subsidy within six
months from the date when the DSB adopts the panel report or the
Appellate Body report, and in the absence of agreement on
compensation, the DSB shall grant authorization to the complaining
Member to take countermeasures, commensurate with the degree and
nature of the adverse effects determined to exist, unless the DSB
decides by consensus to reject the request.
7.10 In
the event that a party to the dispute requests arbitration under
paragraph 6 of Article 22 of the DSU, the arbitrator shall determine
whether the countermeasures are commensurate with the degree and
nature of the adverse effects determined to exist.
PART IV:
NON ACTIONABLE SUBSIDIES
Article
8
Identification of Non Actionable Subsidies
8.1 The
following subsidies shall be considered as non actionable:
(a) subsidies which are not specific within the meaning of Article 2;
(b) subsidies which are specific within the meaning of Article 2
but which meet all of the conditions provided for in paragraphs 2(a),
2(b) or 2(c) below.
8.2 Notwithstanding
the provisions of Parts III and V, the following subsidies shall be
non actionable:
(a) assistance for research activities conducted by firms or by
higher education or research establishments on a contract basis with
firms if: , ,
the
assistance covers not more than 75 per cent of the costs of industrial
research or 50 per cent of the costs of pre competitive development
activity, ;
and provided that such assistance is limited exclusively to:
(i) costs of personnel (researchers, technicians and other supporting
staff employed exclusively in the research activity);
(ii) costs of instruments, equipment, land and buildings used
exclusively and permanently (except when disposed of on a commercial
basis) for the research activity;
(iii) costs of consultancy and equivalent services used exclusively
for the research activity, including bought in research,
technical knowledge, patents, etc.;
(iv) additional overhead costs incurred directly as a result of the
research activity;
(v) other running costs (such as those of materials, supplies and the
like), incurred directly as a result of the research activity.
(b) assistance to disadvantaged regions within the territory of a
Member given pursuant to a general framework of regional development and non specific (within the meaning of Article 2) within
eligible regions provided that:
(i) each disadvantaged region must be a clearly designated contiguous
geographical area with a definable economic and administrative
identity;
(ii) the region is considered as disadvantaged on the basis of
neutral and objective criteria,
indicating that the region's difficulties arise out of more than
temporary circumstances; such criteria must be clearly spelled out
in law, regulation, or other official document, so as to be capable
of verification;
(iii) the criteria shall include a measurement of economic
development which shall be based on at least one of the following
factors:
— one of either income per capita or household income per
capita, or GDP per capita, which must not be above 85 per cent
of the average for the territory concerned;
— unemployment rate, which must be at least 110 per cent of
the average for the territory concerned;
as measured over a three year period; such measurement,
however, may be a composite one and may include other factors.
(c) assistance to promote adaptation of existing facilities to new environmental requirements imposed by law and/or regulations
which result in greater constraints and financial burden on firms,
provided that the assistance:
(i) is a one time non recurring measure; and
(ii) is limited to 20 per cent of the cost of adaptation; and
(iii) does not cover the cost of replacing and operating the assisted
investment, which must be fully borne by firms; and
(iv) is directly linked to and proportionate to a firm's planned
reduction of nuisances and pollution, and does not cover any
manufacturing cost savings which may be achieved; and
(v) is available to all firms which can adopt the new equipment
and/or production processes.
8.3 A
subsidy programme for which the provisions of paragraph 2 are
invoked shall be notified in advance of its implementation to the
Committee in accordance with the provisions of Part VII. Any
such notification shall be sufficiently precise to enable other
Members to evaluate the consistency of the programme with the
conditions and criteria provided for in the relevant provisions of
paragraph 2. Members shall also provide the Committee with
yearly updates of such notifications, in particular by supplying
information on global expenditure for each programme, and on any
modification of the programme. Other Members shall have the right to
request information about individual cases of subsidization under a
notified programme.
8.4 Upon
request of a Member, the Secretariat shall review a notification made
pursuant to paragraph 3 and, where necessary, may require
additional information from the subsidizing Member concerning the
notified programme under review. The Secretariat shall report its
findings to the Committee. The Committee shall, upon request,
promptly review the findings of the Secretariat (or, if a review by
the Secretariat has not been requested, the notification itself),
with a view to determining whether the conditions and criteria laid
down in paragraph 2 have not been met. The procedure provided
for in this paragraph shall be completed at the latest at the first
regular meeting of the Committee following the notification of a
subsidy programme, provided that at least two months have elapsed
between such notification and the regular meeting of the Committee.
The review procedure described in this paragraph shall also apply,
upon request, to substantial modifications of a programme notified in
the yearly updates referred to in paragraph 3.
8.5 Upon
the request of a Member, the determination by the Committee referred
to in paragraph 4, or a failure by the Committee to make such a
determination, as well as the violation, in individual cases, of the
conditions set out in a notified programme, shall be submitted to
binding arbitration. The arbitration body shall present its
conclusions to the Members within 120 days from the date when the
matter was referred to the arbitration body. Except as otherwise
provided in this paragraph, the DSU shall apply to arbitrations
conducted under this paragraph.
Article 9
Consultations and Authorized Remedies
9.1 If, in the course of implementation of a programme referred to in
paragraph 2 of Article 8, notwithstanding the fact that the
programme is consistent with the criteria laid down in that
paragraph, a Member has reasons to believe that this programme has
resulted in serious adverse effects to the domestic industry of that
Member, such as to cause damage which would be difficult to repair,
such Member may request consultations with the Member granting or
maintaining the subsidy.
9.2 Upon
request for consultations under paragraph 1, the Member granting
or maintaining the subsidy programme in question shall enter into
such consultations as quickly as possible. The purpose of the
consultations shall be to clarify the facts of the situation and to
arrive at a mutually acceptable solution.
9.3 If no
mutually acceptable solution has been reached in consultations under
paragraph 2 within 60 days of the request for such
consultations, the requesting Member may refer the matter to the
Committee.
9.4 Where
a matter is referred to the Committee, the Committee shall
immediately review the facts involved and the evidence of the effects
referred to in paragraph 1. If the Committee determines that
such effects exist, it may recommend to the subsidizing Member to
modify this programme in such a way as to remove these effects. The
Committee shall present its conclusions within 120 days from the date
when the matter is referred to it under paragraph 3. In the
event the recommendation is not followed within six months, the
Committee shall authorize the requesting Member to take appropriate
countermeasures commensurate with the nature and degree of the
effects determined to exist.
PART V: COUNTERVAILING MEASURES
Article 10
Application of Article VI of GATT 1994
Members
shall take all necessary steps to ensure that the imposition of a
countervailing duty on any product of the territory of any Member imported into the
territory of another Member is in accordance with the provisions of
Article VI of GATT 1994 and the terms of this
Agreement. Countervailing duties may only be imposed pursuant to
investigations initiated and conducted in accordance with the provisions of this Agreement
and the Agreement on Agriculture.
Article 11
Initiation and Subsequent Investigation
11.1 Except
as provided in paragraph 6, an investigation to determine the
existence, degree and effect of any alleged subsidy shall be
initiated upon a written application by or on behalf of the domestic
industry.
11.2 An
application under paragraph 1 shall include sufficient evidence
of the existence of (a) a subsidy and, if possible, its
amount, (b) injury within the meaning of Article VI
of GATT 1994 as interpreted by this Agreement, and (c) a
causal link between the subsidized imports and the alleged injury.
Simple assertion, unsubstantiated by relevant evidence, cannot be
considered sufficient to meet the requirements of this paragraph.
The application shall contain such information as is reasonably
available to the applicant on the following:
(i) the identity of the applicant and a description of the volume and
value of the domestic production of the like product by the
applicant. Where a written application is made on behalf of the
domestic industry, the application shall identify the industry on
behalf of which the application is made by a list of all known
domestic producers of the like product (or associations of domestic
producers of the like product) and, to the extent possible, a
description of the volume and value of domestic production of the
like product accounted for by such producers;
(ii) a complete description of the allegedly subsidized product, the
names of the country or countries of origin or export in question,
the identity of each known exporter or foreign producer and a list of
known persons importing the product in question;
(iii) evidence with regard to the existence, amount and nature of the
subsidy in question;
(iv) evidence that alleged injury to a domestic industry is caused by
subsidized imports through the effects of the subsidies; this
evidence includes information on the evolution of the volume of the
allegedly subsidized imports, the effect of these imports on prices
of the like product in the domestic market and the consequent impact
of the imports on the domestic industry, as demonstrated by relevant
factors and indices having a bearing on the state of the domestic
industry, such as those listed in paragraphs 2 and 4 of Article
15.
11.3 The
authorities shall review the accuracy and adequacy of the evidence
provided in the application to determine whether the evidence is
sufficient to justify the initiation of an investigation.
11.4 An
investigation shall not be initiated pursuant to paragraph 1
unless the authorities have determined, on the basis of an
examination of the degree of support for, or opposition to, the
application expressed by domestic producers of the like product, that the application has
been made by or on behalf of the domestic industry. The application shall be considered to have been made “by or on
behalf of the domestic industry” if it is supported by those
domestic producers whose collective output constitutes more than
50 per cent of the total production of the like product produced
by that portion of the domestic industry expressing either support
for or opposition to the application. However, no investigation
shall be initiated when domestic producers expressly supporting the
application account for less than 25 per cent of total
production of the like product produced by the domestic industry.
11.5 The
authorities shall avoid, unless a decision has been made to initiate
an investigation, any publicizing of the application for the
initiation of an investigation.
11.6 If,
in special circumstances, the authorities concerned decide to
initiate an investigation without having received a written
application by or on behalf of a domestic industry for the initiation
of such investigation, they shall proceed only if they have
sufficient evidence of the existence of a subsidy, injury and causal
link, as described in paragraph 2, to justify the initiation of an
investigation.
11.7 The
evidence of both subsidy and injury shall be considered
simultaneously (a) in the decision whether or not to initiate
an investigation and (b) thereafter, during the course of the
investigation, starting on a date not later than the earliest date on
which in accordance with the provisions of this Agreement provisional
measures may be applied.
11.8 In
cases where products are not imported directly from the country of
origin but are exported to the importing Member from an intermediate
country, the provisions of this Agreement shall be fully applicable
and the transaction or transactions shall, for the purposes of this
Agreement, be regarded as having taken place between the country of
origin and the importing Member.
11.9 An
application under paragraph 1 shall be rejected and an
investigation shall be terminated promptly as soon as the authorities
concerned are satisfied that there is not sufficient evidence of
either subsidization or of injury to justify proceeding with the
case. There shall be immediate termination in cases where the
amount of a subsidy is de minimis , or where the volume of
subsidized imports, actual or potential, or the injury, is
negligible. For the purpose of this paragraph, the amount of the
subsidy shall be considered to be de minimis if the subsidy is
less than 1 per cent ad valorem.
11.10 An
investigation shall not hinder the procedures of customs clearance.
11.11 Investigations
shall, except in special circumstances, be concluded within one year,
and in no case more than 18 months, after their initiation.
Article 12
Evidence
12.1 Interested
Members and all interested parties in a countervailing duty
investigation shall be given notice of the information which the
authorities require and ample opportunity to present in writing all
evidence which they consider relevant in respect of the investigation
in question.
12.1.1 Exporters, foreign producers or interested Members receiving
questionnaires used in a countervailing duty investigation shall be
given at least 30 days for reply. Due consideration should be given to any request for an extension of
the 30 day period and, upon cause shown, such an extension
should be granted whenever practicable.
12.1.2 Subject to the requirement to protect confidential
information, evidence presented in writing by one interested Member
or interested party shall be made available promptly to other
interested Members or interested parties participating in the
investigation.
12.1.3 As soon as an investigation has been initiated, the
authorities shall provide the full text of the written application
received under paragraph 1 of Article 11 to the known
exporters and to the authorities of the exporting Member and shall make it
available, upon request, to other interested parties involved. Due
regard shall be paid to the protection of confidential information,
as provided for in paragraph 4.
12.2. Interested
Members and interested parties also shall have the right, upon
justification, to present information orally. Where such information
is provided orally, the interested Members and interested parties
subsequently shall be required to reduce such submissions to writing.
Any decision of the investigating authorities can only be based on
such information and arguments as were on the written record of this
authority and which were available to interested Members and
interested parties participating in the investigation, due account
having been given to the need to protect confidential information.
12.3 The
authorities shall whenever practicable provide timely opportunities
for all interested Members and interested parties to see all
information that is relevant to the presentation of their cases, that
is not confidential as defined in paragraph 4, and that is used
by the authorities in a countervailing duty investigation, and to
prepare presentations on the basis of this information.
12.4 Any
information which is by nature confidential (for example, because its
disclosure would be of significant competitive advantage to a
competitor or because its disclosure would have a significantly
adverse effect upon a person supplying the information or upon a
person from whom the supplier acquired the information), or which is
provided on a confidential basis by parties to an investigation
shall, upon good cause shown, be treated as such by the authorities.
Such information shall not be disclosed without specific permission
of the party submitting it.
12.4.1 The authorities shall require interested Members or
interested parties providing confidential information to furnish
non confidential summaries thereof. These summaries shall be in
sufficient detail to permit a reasonable understanding of the
substance of the information submitted in confidence. In exceptional
circumstances, such Members or parties may indicate that such
information is not susceptible of summary. In such exceptional
circumstances, a statement of the reasons why summarization is not
possible must be provided.
12.4.2 If the authorities find that a request for confidentiality is
not warranted and if the supplier of the information is either
unwilling to make the information public or to authorize its
disclosure in generalized or summary form, the authorities may
disregard such information unless it can be demonstrated to their
satisfaction from appropriate sources that the information is
correct.
12.5 Except
in circumstances provided for in paragraph 7, the authorities
shall during the course of an investigation satisfy themselves as to
the accuracy of the information supplied by interested Members or
interested parties upon which their findings are based.
12.6 The
investigating authorities may carry out investigations in the
territory of other Members as required, provided that they have
notified in good time the Member in question and unless that Member
objects to the investigation. Further, the investigating
authorities may carry out investigations on the premises of a firm
and may examine the records of a firm if (a) the firm so
agrees and (b) the Member in question is notified and
does not object. The procedures set forth in Annex VI shall
apply to investigations on the premises of a firm. Subject to the
requirement to protect confidential information, the authorities
shall make the results of any such investigations available, or shall
provide disclosure thereof pursuant to paragraph 8, to the firms
to which they pertain and may make such results available to the
applicants.
12.7 In
cases in which any interested Member or interested party refuses
access to, or otherwise does not provide, necessary information
within a reasonable period or significantly impedes the
investigation, preliminary and final determinations, affirmative or
negative, may be made on the basis of the facts available.
12.8 The
authorities shall, before a final determination is made, inform all
interested Members and interested parties of the essential facts
under consideration which form the basis for the decision whether to
apply definitive measures. Such disclosure should take place in
sufficient time for the parties to defend their interests.
12.9 For
the purposes of this Agreement, “interested parties” shall
include:
(i) an exporter or foreign producer or the importer of a product
subject to investigation, or a trade or business association a
majority of the members of which are producers, exporters or
importers of such product; and
(ii) a producer of the like product in the importing Member or a
trade and business association a majority of the members of which
produce the like product in the territory of the importing Member.
This list
shall not preclude Members from allowing domestic or foreign parties
other than those mentioned above to be included as interested
parties.
12.10 The
authorities shall provide opportunities for industrial users of the
product under investigation, and for representative consumer
organizations in cases where the product is commonly sold at the
retail level, to provide information which is relevant to the
investigation regarding subsidization, injury and causality.
12.11 The
authorities shall take due account of any difficulties experienced by
interested parties, in particular small companies, in supplying
information requested, and shall provide any assistance practicable.
12.12 The
procedures set out above are not intended to prevent the authorities
of a Member from proceeding expeditiously with regard to initiating
an investigation, reaching preliminary or final determinations,
whether affirmative or negative, or from applying provisional or
final measures, in accordance with relevant provisions of this
Agreement.
Article 13
Consultations
13.1 As
soon as possible after an application under Article 11 is
accepted, and in any event before the initiation of any
investigation, Members the products of which may be subject to such
investigation shall be invited for consultations with the aim of
clarifying the situation as to the matters referred to in paragraph 2
of Article 11 and arriving at a mutually agreed solution.
13.2 Furthermore,
throughout the period of investigation, Members the products of which
are the subject of the investigation shall be afforded a reasonable
opportunity to continue consultations, with a view to clarifying the
factual situation and to arriving at a mutually agreed solution.
13.3 Without
prejudice to the obligation to afford reasonable opportunity for
consultation, these provisions regarding consultations are not
intended to prevent the authorities of a Member from proceeding
expeditiously with regard to initiating the investigation, reaching
preliminary or final determinations, whether affirmative or negative,
or from applying provisional or final measures, in accordance with
the provisions of this Agreement.
13.4 The
Member which intends to initiate any investigation or is conducting
such an investigation shall permit, upon request, the Member or
Members the products of which are subject to such investigation
access to non confidential evidence, including the
non confidential summary of confidential data being used for
initiating or conducting the investigation.
Article 14
Subsidy Calculation of the Amount of a Subsidy in
Terms of the Benefit to the Recipient
14.1 For
the purpose of Part V, the any methods used by the investigating authority to calculate the benefit to the
recipient conferred pursuant to paragraph 1 of Article 1
shall be provided for in the national legislation or implementing
regulations of the Member concerned and itstheir application to each particular case shall be transparent and
adequately explained. Furthermore, any such
methods shall be consistent with the following guidelines:
(a) government provision of equity capital shall not be considered as
conferring a benefit, unless the investment decision can be regarded
as inconsistent with the usual investment practice (including for the
provision of risk capital) of private investors in the territory of
that Member;
(b) a loan by a government shall not be considered as conferring a
benefit, unless there is a difference between the amount that the
firm receiving the loan pays on the government loan and the amount
the firm would pay on a comparable commercial loan which the firm
could actually obtain on the market. In this case the benefit shall
be the difference between these two amounts;
(c) a loan guarantee by a government shall not be considered as
conferring a benefit, unless there is a difference between the amount
that the firm receiving the guarantee pays on a loan guaranteed by
the government and the amount that the firm would pay on a comparable
commercial loan absent the government guarantee. In this case the
benefit shall be the difference between these two amounts adjusted
for any differences in fees;46
(d) the provision of goods or services or purchase of goods by a
government shall not be considered as conferring a benefit unless the
provision is made for less than adequate remuneration, or the
purchase is made for more than adequate remuneration. The adequacy
of remuneration shall be determined in relation to prevailing market
conditions for the good or service in question in the country of
provision or purchase (including price, quality, availability,
marketability, transportation and other conditions of purchase or
sale). Where the price level of goods or services provided by a
government is regulated, the adequacy of remuneration shall be
determined in relation to prevailing market conditions for the goods
or services in the country of provision when sold at unregulated
prices, adjusting for quality, availability, marketability,
transportation and other conditions of sale; provided that, when
there is no unregulated price, or such unregulated price is distorted
because of the predominant role of the government in the market as a
provider of the same or similar goods or services, the adequacy of
remuneration may be determined by reference to the export price for
these goods or services, or to a market-determined price outside the
country of provision, adjusting for quality, availability,
marketability, transportation, and other conditions of sale.
14.2 For
the purpose of Part V, where a subsidy is granted in respect of an
input used to produce the product under consideration, and the
producer of the product under consideration is unrelated to the
producer of the input, no benefit from the subsidy in respect of the
input shall be attributed to the product under consideration unless a
determination has been made that the producer of the product under
consideration obtained the input on terms more favourable than
otherwise would have been commercially available to that producer in
the market.
14.3 For
the purpose of Part V, the methods used by the investigating
authority to attribute subsidy benefits to particular time periods
shall be consistent with the following guidelines:
(a) With the exception of benefits from loan subsidies and
similar subsidized debt instruments, subsidy benefits shall either be
expensed in full in the year of receipt (“expensed”) or
allocated over a period of years (“allocated”). Expensed
subsidies shall be deemed to benefit the recipient by the full amount
of the benefit in the year in which they are expensed, whereas
allocated subsidies shall be deemed to benefit the recipient
throughout the allocation period. Loan subsidies, and similar
subsidized debt instruments, shall be deemed to benefit the recipient
throughout the period in which the loan or debt instrument remains
outstanding.
(b) Benefits from subsidies arising from the following types of
measures normally shall be expensed: direct tax exemptions and
deductions; exemptions from and excessive rebates of indirect taxes
or import duties; provision of goods and services for less than
adequate remuneration; price support payments; discounts on
electricity, water, and other utilities; freight subsidies; export
promotion assistance; early retirement payments; worker assistance;
worker training; and wage subsidies.
(c) Benefits from subsidies arising from the following types of
measures shall be allocated: equity infusions; grants; plant
closure assistance; debt forgiveness; coverage for an operating
loss; debt-to-equity conversions; provision of non-general
infrastructure; and provision of plant and equipment.
(d) In determining whether a subsidy listed in paragraph 2(b) is
more appropriately allocated, or whether a subsidy listed in
paragraph 2(c) is more appropriately expensed, and in determining
whether a subsidy of a type not listed in either paragraph 2(b) or
2(c) should be allocated or expensed, the following non-exhaustive
list of factors shall be considered:
(i) whether the subsidy is non-recurring (e.g., one-time,
exceptional, requiring express government approval) or recurring
(ii) the purpose of the subsidy;
and
(iii) the size of the subsidy.
(e) The allocation period for allocated subsidies normally should
correspond to the average useful life of the depreciable, physical
assets of the relevant industry or firm.
(f) Any method for measuring the amount of allocated subsidy
benefits at a particular point in the allocation period may reflect a
reasonable measure of the time value of money.
(g) Any public notice issued pursuant to paragraph 3 of Article
22 shall include a full description and adequate explanation of the
allocation and expensing methodologies used.
Article 15
Determination of Injury
15.1 A determination of injury for purposes of Article VI of
GATT 1994 shall be based on positive evidence and involve an
objective examination of both (a) the volume of the subsidized
imports and the effect of the subsidized imports on prices in the
domestic market for like products and (b) the consequent impact of these imports on the domestic
producers of such products.
15.2 With
regard to the volume of the subsidized imports, the investigating
authorities shall consider whether there has been a significant
increase in subsidized imports, either in absolute terms or relative
to production or consumption in the importing Member. With regard
to the effect of the subsidized imports on prices, the investigating
authorities shall consider whether there has been a significant price
undercutting by the subsidized imports as compared with the price of
a like product of the importing Member, or whether the effect of such
imports is otherwise to depress prices to a significant degree or to
prevent price increases, which otherwise would have occurred, to a
significant degree. No one or several of these factors can
necessarily give decisive guidance.
15.3 Where
imports of a product from more than one country are simultaneously
subject to countervailing duty investigations, the investigating
authorities may cumulatively assess the effects of such imports only
if they determine that (a) the amount of subsidization
established in relation to the imports from each country is more than de minimis as defined in paragraph 9 of Article 11
and the volume of imports from each country is not negligible and (b) a cumulative assessment of the effects of the imports is appropriate
in light of the conditions of competition between the imported
products and the conditions of competition between the imported
products and the like domestic product.
15.4 The
examination of the impact of the subsidized imports on the domestic
industry shall include an evaluation of all relevant economic factors
and indices having a bearing on the state of the industry, including
actual and potential decline in output, sales, market share, profits,
productivity, return on investments, or utilization of capacity;
factors affecting domestic prices; actual and potential negative
effects on cash flow, inventories, employment, wages, growth, ability
to raise capital or investments and, in the case of agriculture,
whether there has been an increased burden on government support
programmes. This list is not exhaustive, nor can one or several of
these factors necessarily give decisive guidance.
15.5 It
must be demonstrated that the subsidized imports are, through the
effects of subsidies, causing injury within the meaning of this Agreement.
The demonstration of a causal relationship between the subsidized
imports and the injury to the domestic industry shall be based on an
examination of all relevant evidence before the authorities. The
authorities shall also examine any known factors other than the
subsidized imports which at the same time are injuring the domestic
industry, and the injuries caused by these other factors must not be
attributed to the subsidized imports. Factors which may be relevant
in this respect include, inter alia, the volumes and prices of
non subsidized imports of the product in question, contraction
in demand or changes in the patterns of consumption, trade
restrictive practices of and competition between the foreign and
domestic producers, developments in technology and the export
performance and productivity of the domestic industry.
15.6 The
effect of the subsidized imports shall be assessed in relation to the
domestic production of the like product when available data permit
the separate identification of that production on the basis of such
criteria as the production process, producers' sales and profits. If
such separate identification of that production is not possible, the
effects of the subsidized imports shall be assessed by the
examination of the production of the narrowest group or range of
products, which includes the like product, for which the necessary
information can be provided.
15.7 A
determination of a threat of material injury shall be based on facts
and not merely on allegation, conjecture or remote possibility. The
change in circumstances which would create a situation in which the
subsidy would cause injury must be clearly foreseen and imminent.
In making a determination regarding the existence of a threat of
material injury, the investigating authorities should consider, inter alia, such factors as:
(i) nature of the subsidy or subsidies in question and the trade
effects likely to arise therefrom;
(ii) a significant rate of increase of subsidized imports into the
domestic market indicating the likelihood of substantially increased
importation;
(iii) sufficient freely disposable, or an imminent, substantial
increase in, capacity of the exporter indicating the likelihood of
substantially increased subsidized exports to the importing Member's
market, taking into account the availability of other export markets
to absorb any additional exports;
(iv) whether imports are entering at prices that will have a
significant depressing or suppressing effect on domestic prices, and
would likely increase demand for further imports; and
(v) inventories of the product being investigated.
No one of
these factors by itself can necessarily give decisive guidance but
the totality of the factors considered must lead to the conclusion
that further subsidized exports are imminent and that, unless
protective action is taken, material injury would occur.
15.8 With
respect to cases where injury is threatened by subsidized imports,
the application of countervailing measures shall be considered and
decided with special care.
Article 16
Definition of Domestic Industry
16.1 For the purposes of this Agreement, the term “domestic
industry” shall, except as provided in paragraph 2, be
interpreted as referring to the domestic producers as a whole of the
like products or to those of them whose collective output of the
products constitutes a major proportion of the total domestic
production of those products, except that when producers are related to the exporters or importers or are themselves importers of the
allegedly subsidized product or a like product from other countries,
the term “domestic industry” may be interpreted as
referring to the rest of the producers.
16.2. In
exceptional circumstances, the territory of a Member may, for the
production in question, be divided into two or more competitive
markets and the producers within each market may be regarded as a
separate industry if (a) the producers within such market
sell all or almost all of their production of the product in question
in that market, and (b) the demand in that market is not
to any substantial degree supplied by producers of the product in
question located elsewhere in the territory. In such circumstances,
injury may be found to exist even where a major portion of the total
domestic industry is not injured, provided there is a concentration
of subsidized imports into such an isolated market and provided
further that the subsidized imports are causing injury to the
producers of all or almost all of the production within such market.
16.3 When
the domestic industry has been interpreted as referring to the
producers in a certain area, i.e. a market as defined in
paragraph 2, countervailing duties shall be levied only on the
products in question consigned for final consumption to that area.
When the constitutional law of the importing Member does not permit
the levying of countervailing duties on such a basis, the importing
Member may levy the countervailing duties without limitation only if (a) the exporters shall have been given an opportunity to
cease exporting at subsidized prices to the area concerned or
otherwise give assurances pursuant to Article 18, and adequate
assurances in this regard have not been promptly given, and (b) such duties cannot be levied only on products of
specific producers which supply the area in question.
16.4 Where
two or more countries have reached under the provisions of
paragraph 8(a) of Article XXIV of GATT 1994 such a
level of integration that they have the characteristics of a single,
unified market, the industry in the entire area of integration shall
be taken to be the domestic industry referred to in paragraphs 1
and 2.
16.5 The
provisions of paragraph 6 of Article 15 shall be applicable to this
Article.
Article 17
Provisional Measures
17.1 Provisional
measures may be applied only if:
(a) an investigation has been initiated in accordance with the
provisions of Article 11, a public notice has been given to
that effect and interested Members and interested parties have been
given adequate opportunities to submit information and make comments;
(b) a preliminary affirmative determination has been made that a
subsidy exists and that there is injury to a domestic industry caused
by subsidized imports; and
(c) the authorities concerned judge such measures necessary to
prevent injury being caused during the investigation.
17.2 Provisional
measures may take the form of provisional countervailing duties
guaranteed by cash deposits or bonds equal to the amount of the
provisionally calculated amount of subsidization.
17.3 Provisional
measures shall not be applied sooner than 60 days from the date
of initiation of the investigation.
17.4 The
application of provisional measures shall be limited to as short a
period as possible, not exceeding four months.
17.5 The
relevant provisions of Article 19 shall be followed in the
application of provisional measures.
Article 18
Undertakings
18.1 Proceedings
may be suspended or terminated without the imposition of provisional
measures or countervailing duties upon receipt of satisfactory
voluntary undertakings under which:
(a) the government of the exporting Member agrees to eliminate or
limit the subsidy or take other measures concerning its effects; or
(b) the exporter agrees to revise its prices so that the
investigating authorities are satisfied that the injurious effect of
the subsidy is eliminated. Price increases under such undertakings
shall not be higher than necessary to eliminate the amount of the
subsidy. It is desirable that the price increases be less than
the amount of the subsidy if such increases would be adequate to
remove the injury to the domestic industry.
18.2 Undertakings
shall not be sought or accepted unless the authorities of the
importing Member have made a preliminary affirmative determination
of subsidization and injury caused by such subsidization and, in case
of undertakings from exporters, have obtained the consent of the
exporting Member.
18.3 Undertakings
offered need not be accepted if the authorities of the importing
Member consider their acceptance impractical, for example if the
number of actual or potential exporters is too great, or for other
reasons, including reasons of general policy. Should the case arise
and where practicable, the authorities shall provide to the exporter
the reasons which have led them to consider acceptance of an
undertaking as inappropriate, and shall, to the extent possible, give
the exporter an opportunity to make comments thereon.
18.4 If an
undertaking is accepted, the investigation of subsidization and
injury shall nevertheless be completed if the exporting Member so
desires or the importing Member so decides. In such a case, if a
negative determination of subsidization or injury is made, the
undertaking shall automatically lapse, except in cases where such a
determination is due in large part to the existence of an
undertaking. In such cases, the authorities concerned may require
that an undertaking be maintained for a reasonable period consistent
with the provisions of this Agreement. In the event that an
affirmative determination of subsidization and injury is made, the
undertaking shall continue consistent with its terms and the
provisions of this Agreement.
18.5 Price
undertakings may be suggested by the authorities of the importing
Member, but no exporter shall be forced to enter into such
undertakings. The fact that governments or exporters do not offer
such undertakings, or do not accept an invitation to do so, shall in
no way prejudice the consideration of the case. However, the
authorities are free to determine that a threat of injury is more
likely to be realized if the subsidized imports continue.
18.6 Authorities
of an importing Member may require any government or exporter from
whom an undertaking has been accepted to provide periodically
information relevant to the fulfilment of such an undertaking, and to
permit verification of pertinent data. In case of violation of an
undertaking, the authorities of the importing Member may take, under
this Agreement in conformity with its provisions, expeditious actions
which may constitute immediate application of provisional measures
using the best information available. In such cases, definitive
duties may be levied in accordance with this Agreement on products
entered for consumption not more than 90 days before the application
of such provisional measures, except that any such retroactive
assessment shall not apply to imports entered before the violation of
the undertaking.
Article 19
Imposition and Collection of Countervailing Duties
19.1 If,
after reasonable efforts have been made to complete consultations, a
Member makes a final determination of the existence and amount of the
subsidy and that, through the effects of the subsidy, the subsidized
imports are causing injury, it may impose a countervailing duty in
accordance with the provisions of this Article unless the subsidy or
subsidies are withdrawn.
19.2 The
decision whether or not to impose a countervailing duty in cases
where all requirements for the imposition have been fulfilled, and
the decision whether the amount of the countervailing duty to be
imposed shall be the full amount of the subsidy or less, are
decisions to be made by the authorities of the importing Member. It
is desirable that the imposition should be permissive in the
territory of all Members, that the duty should be less than the total
amount of the subsidy if such lesser duty would be adequate to remove
the injury to the domestic industry, and that procedures should be
established which would allow the authorities concerned to take due
account of representations made by domestic interested parties whose interests might be adversely affected by the imposition of a
countervailing duty.
19.3 When
a countervailing duty is imposed in respect of any product, such
countervailing duty shall be levied, in the appropriate amounts in
each case, on a non discriminatory basis on imports of such
product from all sources found to be subsidized and causing injury,
except as to imports from those sources which have renounced any
subsidies in question or from which undertakings under the terms of
this Agreement have been accepted. Any exporter whose exports are
subject to a definitive countervailing duty but who was not actually
investigated for reasons other than a refusal to cooperate, shall be
entitled to an expedited review in order that the investigating
authorities promptly establish an individual countervailing duty rate
for that exporter.
19.4 No
countervailing duty shall be levied on any imported product in excess of the amount of the subsidy found
to exist, calculated in terms of subsidization per unit of the
subsidized and exported product.
Article 20
Retroactivity
20.1 Provisional
measures and countervailing duties shall only be applied to products
which enter for consumption after the time when the decision under
paragraph 1 of Article 17 and paragraph 1 of
Article 19, respectively, enters into force, subject to the
exceptions set out in this Article.
20.2 Where
a final determination of injury (but not of a threat thereof or of a
material retardation of the establishment of an industry) is made or,
in the case of a final determination of a threat of injury, where the
effect of the subsidized imports would, in the absence of the
provisional measures, have led to a determination of injury,
countervailing duties may be levied retroactively for the period for
which provisional measures, if any, have been applied.
20.3 If
the definitive countervailing duty is higher than the amount
guaranteed by the cash deposit or bond, the difference shall not be
collected. If the definitive duty is less than the amount
guaranteed by the cash deposit or bond, the excess amount shall be
reimbursed or the bond released in an expeditious manner.
20.4 Except
as provided in paragraph 2, where a determination of threat of
injury or material retardation is made (but no injury has yet
occurred) a definitive countervailing duty may be imposed only from
the date of the determination of threat of injury or material
retardation, and any cash deposit made during the period of the
application of provisional measures shall be refunded and any bonds
released in an expeditious manner.
20.5 Where
a final determination is negative, any cash deposit made during the
period of the application of provisional measures shall be refunded
and any bonds released in an expeditious manner.
20.6 In
critical circumstances where for the subsidized product in question
the authorities find that injury which is difficult to repair is
caused by massive imports in a relatively short period of a product
benefiting from subsidies paid or bestowed inconsistently with the
provisions of GATT 1994 and of this Agreement and where it is
deemed necessary, in order to preclude the recurrence of such injury,
to assess countervailing duties retroactively on those imports, the
definitive countervailing duties may be assessed on imports which
were entered for consumption not more than 90 days prior to the date
of application of provisional measures.
Article 21
Duration and Review of Countervailing Duties and Undertakings
21.1 A
countervailing duty shall remain in force only as long as and to the
extent necessary to counteract subsidization which is causing injury.
21.2 The
authorities shall review the need for the continued imposition of the
duty, where warranted, on their own initiative or, provided that a
reasonable period of time has elapsed since the imposition of the
definitive countervailing duty, upon request by any interested party
which submits positive information substantiating the need for a
review. Interested parties shall have the right to request the
authorities to examine whether the continued imposition of the duty
is necessary to offset subsidization, whether the injury would be
likely to continue or recur if the duty were removed or varied, or
both. If, as a result of the review under this paragraph, the
authorities determine that the countervailing duty is no longer
warranted, it shall be terminated immediately.
21.3 Notwithstanding
the provisions of paragraphs 1 and 2, any definitive countervailing
duty shall be terminated on a date not later than five years from its
imposition (or from the date of the most recent review under
paragraph 2 if that review has covered both subsidization and injury,
or under this paragraph), unless the authorities determine, in a
review initiated before that date on their own initiative or upon a
duly substantiated request made by or on behalf of the domestic
industry within a reasonable period of time prior to that date, that
the expiry of the duty would be likely to lead to continuation or
recurrence of subsidization and injury. The duty may remain in force pending the outcome of such a review.
21.4 The
provisions of Article 12 regarding evidence and procedure shall apply
to any review carried out under this Article. Any such review shall
be carried out expeditiously and shall normally be concluded within
12 months of the date of initiation of the review.
21.5 The
provisions of this Article shall apply mutatis mutandis to
undertakings accepted under Article 18.
Article 22
Public Notice and Explanation of Determinations
22.1 When
the authorities are satisfied that there is sufficient evidence to
justify the initiation of an investigation pursuant to Article 11,
the Member or Members the products of which are subject to such
investigation and other interested parties known to the investigating
authorities to have an interest therein shall be notified and a
public notice shall be given.
22.2 A
public notice of the initiation of an investigation shall contain, or
otherwise make available through a separate report,
adequate information on the following:
(i) the name of the exporting country or countries and the product
involved;
(ii) the date of initiation of the investigation;
(iii) a description of the subsidy practice or practices to be
investigated;
(iv) a summary of the factors on which the allegation of injury is
based;
(v) the address to which representations by interested Members and
interested parties should be directed; and
(vi) the time limits allowed to interested Members and
interested parties for making their views known.
22.3 Public
notice shall be given of any preliminary or final determination,
whether affirmative or negative, of any decision to accept an
undertaking pursuant to Article 18, of the termination of such an
undertaking, and of the termination of a definitive countervailing
duty. Each such notice shall set forth, or otherwise make available
through a separate report, in sufficient detail the findings and
conclusions reached on all issues of fact and law considered material
by the investigating authorities. All such notices and reports shall
be forwarded to the Member or Members the products of which are
subject to such determination or undertaking and to other interested
parties known to have an interest therein.
22.4 A
public notice of the imposition of provisional measures shall set
forth, or otherwise make available through a separate report,
sufficiently detailed explanations for the preliminary determinations
on the existence of a subsidy and injury and shall refer to the
matters of fact and law which have led to arguments being accepted or
rejected. Such a notice or report shall, due regard being paid to
the requirement for the protection of confidential information,
contain in particular:
(i) the names of the suppliers or, when this is impracticable, the
supplying countries involved;
(ii) a description of the product which is sufficient for customs
purposes;
(iii) the amount of subsidy established and the basis on which the
existence of a subsidy has been determined;
(iv) considerations relevant to the injury determination as set out
in Article 15;
(v) the main reasons leading to the determination.
22.5 A
public notice of conclusion or suspension of an investigation in the
case of an affirmative determination providing for the imposition of
a definitive duty or the acceptance of an undertaking shall contain,
or otherwise make available through a separate report, all relevant
information on the matters of fact and law and reasons which have led
to the imposition of final measures or the acceptance of an
undertaking, due regard being paid to the requirement for the
protection of confidential information. In particular, the notice or
report shall contain the information described in paragraph 4,
as well as the reasons for the acceptance or rejection of relevant
arguments or claims made by interested Members and by the exporters
and importers.
22.6 A
public notice of the termination or suspension of an investigation
following the acceptance of an undertaking pursuant to Article 18
shall include, or otherwise make available through a separate report,
the non confidential part of this undertaking.
22.7 The
provisions of this Article shall apply mutatis mutandis to the initiation and completion of reviews pursuant to Article 21
and to decisions under Article 20 to apply duties retroactively.
Article 23
Judicial Review
Each Member whose national legislation contains provisions on
countervailing duty measures shall maintain judicial, arbitral or
administrative tribunals or procedures for the purpose, inter alia,
of the prompt review of administrative actions relating to final
determinations and reviews of determinations within the meaning of
Article 21. Such tribunals or procedures shall be independent of the
authorities responsible for the determination or review in question,
and shall provide all interested parties who participated in the
administrative proceeding and are directly and individually affected
by the administrative actions with access to review.
PART VI: INSTITUTIONS
Article 24
Committee on Subsidies and Countervailing Measures and Subsidiary Bodies
24.1 There is hereby established a Committee on Subsidies and
Countervailing Measures composed of representatives from each of the
Members. The Committee shall elect its own Chairman and shall meet
not less than twice a year and otherwise as envisaged by relevant
provisions of this Agreement at the request of any Member. The
Committee shall carry out responsibilities as assigned to it under
this Agreement or by the Members and it shall afford Members the
opportunity of consulting on any matter relating to the operation of
the Agreement or the furtherance of its objectives. The WTO
Secretariat shall act as the secretariat to the Committee.
24.2 The
Committee may set up subsidiary bodies as appropriate.
24.3 The
Committee shall establish a Permanent Group of Experts composed of
five independent persons, highly qualified in the fields of subsidies
and trade relations. The experts will be elected by the Committee
and one of them will be replaced every year. The PGE may be
requested to assist a panel, as provided for in paragraph 5 of
Article 4. The Committee may also seek an advisory opinion on
the existence and nature of any subsidy.
24.4 The
PGE may be consulted by any Member and may give advisory opinions on
the nature of any subsidy proposed to be introduced or currently
maintained by that Member. Such advisory opinions will be
confidential and may not be invoked in proceedings under Article 7.
24.5 In
carrying out their functions, the Committee and any subsidiary bodies
may consult with and seek information from any source they deem
appropriate. However, before the Committee or a subsidiary body
seeks such information from a source within the jurisdiction of a
Member, it shall inform the Member involved.
PART VII: NOTIFICATION AND SURVEILLANCE
Article 25
Notifications
25.1 Members agree that, without prejudice to the provisions of
paragraph 1 of Article XVI of GATT 1994, their
notifications of subsidies shall be submitted not later than 30 June
of each second year and shall conform to the provisions of
paragraphs 2 through 6.
25.2 Members
shall notify any subsidy as defined in paragraph 1 of Article 1,
which is specific within the meaning of Article 2, granted or
maintained within their territories.
25.3 The
content of notifications should be sufficiently specific to enable
other Members to evaluate the trade effects and to understand the
operation of notified subsidy programmes. In this connection, and
without prejudice to the contents and form of the questionnaire on
subsidies,
Members shall ensure that their notifications contain the following
information:
(i) form of a subsidy (i.e. grant, loan, tax concession, etc.);
(ii) subsidy per unit or, in cases where this is not possible, the
total amount or the annual amount budgeted for that subsidy
(indicating, if possible, the average subsidy per unit in the
previous year);
(iii) policy objective and/or purpose of a subsidy;
(iv) duration of a subsidy and/or any other time limits attached
to it;
(v) statistical data permitting an assessment of the trade effects of
a subsidy.
25.4 Where
specific points in paragraph 3 have not been addressed in a
notification, an explanation shall be provided in the notification
itself.
25.5 If
subsidies are granted to specific products or sectors, the
notifications should be organized by product or sector.
25.6 Members
which consider that there are no measures in their territories
requiring notification under paragraph 1 of Article XVI of
GATT 1994 and this Agreement shall so inform the Secretariat in
writing.
25.7 Members
recognize that notification of a measure does not prejudge either its
legal status under GATT 1994 and this Agreement, the effects
under this Agreement, or the nature of the measure itself.
25.8 Any
Member may, at any time, make a written request for information on
the nature and extent of any subsidy granted or maintained by another
Member (including any subsidy referred to in Part IV), or for an
explanation of the reasons for which a specific measure has been
considered as not subject to the requirement of notification.
25.9 Members
so requested shall provide such information as quickly as possible
and in a comprehensive manner, and shall be ready, upon request, to
provide additional information to the requesting Member. In
particular, they shall provide sufficient details to enable the other
Member to assess their compliance with the terms of this Agreement.
Any Member which considers that such information has not been
provided may bring the matter to the attention of the Committee.
25.10 Any
Member which considers that any measure of another Member having the
effects of a subsidy has not been notified in accordance with the
provisions of paragraph 1 of Article XVI of GATT 1994
and this Article may bring the matter to the attention of such other
Member. If the alleged subsidy is not thereafter notified promptly,
such Member may itself bring the alleged subsidy in question to the
notice of the Committee.
25.11 Members
shall report without delay to the Committee all preliminary or final
actions taken with respect to countervailing duties. Such reports
shall be available in the Secretariat for inspection by other
Members. Members shall also submit, on a semi annual basis,
reports on any countervailing duty actions taken within the preceding
six months. The semi annual reports shall be submitted on an
agreed standard form.
25.12 Each
Member shall notify the Committee (a) which of its
authorities are competent to initiate and conduct investigations
referred to in Article 11 and (b) its domestic
procedures governing the initiation and conduct of such
investigations.
Article 26
Surveillance
26.1 The
Committee shall examine the new and full notifications
submitted under paragraph 1 of Article XVI of GATT 1994
and paragraph 1 of Article 25 of this Agreement at special
sessions held every thirdsecond year. Notifications submitted in the intervening years (updating
notifications) shall be examined at each regular meeting of the
Committee.
26.2 The
Committee shall examine reports submitted under paragraph 11 of
Article 25 at each regular meeting of the Committee.
PART VIII: DEVELOPING COUNTRY MEMBERS
Article 27
Special and Differential Treatment of Developing Country Members
27.1 Members
recognize that subsidies may play an important role in economic
development programmes of developing country Members.
27.2 The
prohibition of paragraph 1(a) of Article 3 shall not apply to:
(a) developing country Members referred to in Annex VII.
(b) other developing country Members for a period of eight years
from the date of entry into force of the WTO Agreement, subject to
compliance with the provisions in paragraph 4.
27.3 The
prohibition of paragraph 1(b) of Article 3 shall not apply
to developing country Members for a period of five years, and shall
not apply to least developed country Members for a period of eight
years, from the date of entry into force of the WTO Agreement.
27.4 Any
developing country Member referred to in paragraph 2(b) shall
phase out its export subsidies within the eight year period,
preferably in a progressive manner. However, a developing country
Member shall not increase the level of its export subsidies,
and shall eliminate them within a period shorter than that provided
for in this paragraph when the use of such export subsidies is
inconsistent with its development needs. If a developing country
Member deems it necessary to apply such subsidies beyond the 8 year
period, it shall not later than one year before the expiry of this
period enter into consultation with the Committee, which will
determine whether an extension of this period is justified, after
examining all the relevant economic, financial and development needs
of the developing country Member in question. If the Committee
determines that the extension is justified, the developing country
Member concerned shall hold annual consultations with the Committee
to determine the necessity of maintaining the subsidies. If no such
determination is made by the Committee, the developing country Member
shall phase out the remaining export subsidies within two years from
the end of the last authorized period.
27.5 A
developing country Member which has reached export competitiveness in
any given product shall phase out its export subsidies for such
product(s) over a period of two years. However, for a developing
country Member which is referred to in Annex VII and which has
reached export competitiveness in one or more products, export
subsidies on such products shall be gradually phased out over a
period of eight years.
27.6 Export
competitiveness in a product exists if a developing country Member's
exports of that product have reached a share of at least
3.25 per cent in world trade of that product for two
consecutive calendar years. Export competitiveness shall exist
either (a) on the basis of notification by the developing
country Member having reached export competitiveness, or (b) on the basis of a computation undertaken by the Secretariat at the
request of any Member. For the purpose of this paragraph, a product
is defined as a section heading of the Harmonized System
Nomenclature. The Committee shall review the operation of this
provision five years from the date of the entry into force of
the WTO Agreement.
27.7 The
provisions of Article 4 shall not apply to a developing country
Member in the case of export subsidies which are in conformity with
the provisions of paragraphs 2 through 5. The relevant
provisions in such a case shall be those of Article 7.
27.8 There
shall be no presumption in terms of paragraph 1 of Article 6
that a subsidy granted by a developing country Member results in
serious prejudice, as defined in this Agreement. Such serious
prejudice, where applicable under the terms of paragraph 9,
shall be demonstrated by positive evidence, in accordance with the
provisions of paragraphs 3 through 8 of Article 6.
27.9 Regarding
actionable subsidies granted or maintained by a developing country
Member other than those referred to in paragraph 1 of Article 6,
action may not be authorized or taken under Article 7 unless
nullification or impairment of tariff concessions or other
obligations under GATT 1994 is found to exist as a result of
such a subsidy, in such a way as to displace or impede imports of a
like product of another Member into the market of the subsidizing
developing country Member or unless injury to a domestic industry in
the market of an importing Member occurs.
27.10 Any
countervailing duty investigation of a product originating in a
developing country Member shall be terminated as soon as the
authorities concerned determine that:
(a) the overall level of subsidies granted upon the product in
question does not exceed 2 per cent of its value calculated
on a per unit basis; or
(b) the volume of the subsidized imports represents less than
4 per cent of the total imports of the like product in the
importing Member, unless imports from developing country Members
whose individual shares of total imports represent less than
4 per cent collectively account for more than 9 per cent
of the total imports of the like product in the importing Member.
27.11 For
those developing country Members within the scope of paragraph 2(b)
which have eliminated export subsidies prior to the expiry of the
period of eight years from the date of entry into force of the
WTO Agreement, and for those developing country Members referred
to in Annex VII, the number in paragraph 10(a) shall be
3 per cent rather than 2 per cent. This
provision shall apply from the date that the elimination of export
subsidies is notified to the Committee, and for so long as export
subsidies are not granted by the notifying developing country Member.
This provision shall expire eight years from the date of entry
into force of the WTO Agreement.
27.12 The
provisions of paragraphs 10 and 11 shall govern any
determination of de minimis under paragraph 3 of
Article 15.
27.13 The
provisions of Part III shall not apply to direct forgiveness of
debts, subsidies to cover social costs, in whatever form, including
relinquishment of government revenue and other transfer of
liabilities when such subsidies are granted within and directly
linked to a privatization programme of a developing country Member,
provided that both such programme and the subsidies involved are
granted for a limited period and notified to the Committee and that
the programme results in eventual privatization of the enterprise
concerned.
27.14 The
Committee shall, upon request by an interested Member, undertake a
review of a specific export subsidy practice of a developing country
Member to examine whether the practice is in conformity with its
development needs.
27.15 The
Committee shall, upon request by an interested developing country
Member, undertake a review of a specific countervailing measure to
examine whether it is consistent with the provisions of paragraphs 10
and 11 as applicable to the developing country Member in question.
PART IX:
TRANSITIONAL ARRANGEMENTS
Article
28
Existing Programmes
28.1 Subsidy
programmes which have been established within the territory of any
Member before the date on which such a Member signed the WTO
Agreement and which are inconsistent with the provisions of this
Agreement shall be:
(a) notified to the Committee not later than 90 days after the
date of entry into force of the WTO Agreement for such Member; and
(b) brought into conformity with the provisions of this Agreement
within three years of the date of entry into force of the WTO
Agreement for such Member and until then shall not be subject to
Part II.
28.2 No
Member shall extend the scope of any such programme, nor shall such a
programme be renewed upon its expiry.
Article 29
Transformation into a Market Economy
29.1 Members
in the process of transformation from a centrally planned into a
market, free enterprise economy may apply programmes and
measures necessary for such a transformation.
29.2 For
such Members, subsidy programmes falling within the scope of Article
3, and notified according to paragraph 3, shall be phased out or
brought into conformity with Article 3 within a period of
seven years from the date of entry into force of the WTO
Agreement. In such a case, Article 4 shall not apply. In
addition during the same period:
(a) Subsidy programmes falling within the scope of paragraph 1(d)
of Article 6 shall not be actionable under Article 7;
(b) With respect to other actionable subsidies, the provisions of
paragraph 9 of Article 27 shall apply.
29.3 Subsidy
programmes falling within the scope of Article 3 shall be
notified to the Committee by the earliest practicable date after the
date of entry into force of the WTO Agreement. Further notifications
of such subsidies may be made up to two years after the date of entry
into force of the WTO Agreement.
29.4 In
exceptional circumstances Members referred to in paragraph 1 may
be given departures from their notified programmes and measures and
their time frame by the Committee if such departures are deemed
necessary for the process of transformation.
PART X: DISPUTE SETTLEMENT
Article 30
The
provisions of Articles XXII and XXIII of GATT 1994 as
elaborated and applied by the Dispute Settlement Understanding shall
apply to consultations and the settlement of disputes under this
Agreement, except as otherwise specifically provided herein.
PART XI: FINAL PROVISIONS
Article 31
Provisional Application
The provisions of paragraph 1 of Article 6 and the
provisions of Article 8 and Article 9 shall apply for a
period of five years, beginning with the date of entry into
force of the WTO Agreement. Not later than 180 days before the
end of this period, the Committee shall review the operation of those
provisions, with a view to determining whether to extend their
application, either as presently drafted or in a modified form, for a
further period.
Article 32
Other Final Provisions
32.1 No
specific action against a subsidy of another Member can be taken
except in accordance with the provisions of GATT 1994, as
interpreted by this Agreement.
32.2 Reservations
may not be entered in respect of any of the provisions of this
Agreement without the consent of the other Members.
32.3 Subject
to paragraph 4, the provisions of this Agreement shall apply to
investigations, and reviews of existing measures, initiated pursuant
to applications which have been made on or after the date of entry
into force for a Member of the WTO Agreement.
32.4 For
the purposes of paragraph 3 of Article 21, existing countervailing
measures shall be deemed to be imposed on a date not later than the
date of entry into force for a Member of the WTO Agreement, except in
cases in which the domestic legislation of a Member in force at that
date already included a clause of the type provided for in that
paragraph.
32.5 Each
Member shall take all necessary steps, of a general or particular
character, to ensure, not later than the date of entry into force of
the WTO Agreement for it, the conformity of its laws, regulations and
administrative procedures with the provisions of this Agreement as
they may apply to the Member in question.
32.6 Each
Member shall inform the Committee of any changes in its laws and
regulations relevant to this Agreement and in the administration of
such laws and regulations.
32.7 The
Committee shall review annually the implementation and operation of
this Agreement, taking into account the objectives thereof. The
Committee shall inform annually the Council for Trade in Goods of
developments during the period covered by such reviews.
32.8 The
Annexes to this Agreement constitute an integral part thereof.
ANNEX I
ILLUSTRATIVE LIST OF CERTAIN EXPORT SUBSIDIES
(a) The provision by governments of direct subsidies to a firm or an
industry contingent upon export performance.
(b) Currency retention schemes or any similar practices which involve
a bonus on exports.
(c) Internal transport and freight charges on export shipments,
provided or mandated by governments, on terms more favourable than
for domestic shipments.
(d) The provision by governments or their agencies either directly or
indirectly through government mandated schemes, of imported or
domestic products or services for use in the production of exported
goods, on terms or conditions more favourable than for provision of
like or directly competitive products or services for use in the
production of goods for domestic consumption, if (in the case of
products) such terms or conditions are more favourable than those
commercially available64 on world
markets to their exporters.
(e) The full or partial exemption remission, or deferral specifically
related to exports, of direct taxes or social welfare charges paid or payable by industrial or commercial
enterprises.
(f) The allowance of special deductions directly related to exports
or export performance, over and above those granted in respect to
production for domestic consumption, in the calculation of the base
on which direct taxes are charged.
(g) The exemption or remission, in respect of the production and
distribution of exported products, of indirect taxes5865 in excess of those levied in respect of the production and
distribution of like products when sold for domestic consumption.
(h) The exemption, remission or deferral of prior stage
cumulative indirect taxes5865 on
goods or services used in the production of exported products in
excess of the exemption, remission or deferral of like prior stage
cumulative indirect taxes on goods or services used in the
production of like products when sold for domestic consumption;
provided, however, that prior stage cumulative indirect taxes
may be exempted, remitted or deferred on exported products even when
not exempted, remitted or deferred on like products when sold for
domestic consumption, if the prior stage cumulative indirect
taxes are levied on inputs that are consumed in the production of the
exported product (making normal allowance for waste). This item shall be interpreted in accordance with the guidelines on
consumption of inputs in the production process contained in
Annex II.
(i) The remission or drawback of import charges5865 in excess of those levied on imported inputs that are consumed in the
production of the exported product (making normal allowance for
waste); provided, however, that in particular cases a firm may use a
quantity of home market inputs equal to, and having the same quality
and characteristics as, the imported inputs as a substitute for them
in order to benefit from this provision if the import and the
corresponding export operations both occur within a reasonable time
period, not to exceed two years. This item shall be interpreted in
accordance with the guidelines on consumption of inputs in the
production process contained in Annex II and the guidelines in
the determination of substitution drawback systems as export
subsidies contained in Annex III.
(j) The provision by governments (or special institutions controlled
by and/or acting under the authority of governments) of export
credit guarantee or insurance programmes, of insurance or guarantee
programmes against increases in the cost of exported products or of
exchange risk programmes, at premium rates which are inadequate to
cover the long term operating costs and losses of the
programmes.
(k) The grant by governments (or special institutions controlled by
and/or acting under the authority of governments) of export credits at rates below those available to the recipient on international
capital markets (absent any government guarantee or support), for
funds of the same maturity and other credit terms and denominated in
the same currency as the export credit. at rates below
those which they actually have to pay for the funds so employed (or
would have to pay if they borrowed on international capital markets
in order to obtain funds of the same maturity and other credit terms
and denominated in the same currency as the export credit), or the
payment by them of all or part of the costs incurred by exporters or
financial institutions in obtaining credits, in so far as they are
used to secure a material advantage in the field of export credit
terms.
Provided, however, that if a Member is a party to an international
undertaking on official export credits to which at least twelve
original Members to this Agreement are parties as of 1 January 1979
(or a successor undertaking which has been adopted by those original
Members),
or if in practice a Member applies the interest rates provisions of
the relevant undertaking, an export credit practice which is in
conformity with those provisions shall not be considered an export
subsidy prohibited by this Agreement.
(l) Any other charge on the public account constituting an export
subsidy in the sense of Article XVI of GATT 1994.
ANNEX II
GUIDELINES ON CONSUMPTION OF INPUTS IN THE PRODUCTION PROCESS
I
1. Indirect
tax rebate schemes can allow for exemption, remission or deferral of
prior stage cumulative indirect taxes levied on inputs that are
consumed in the production of the exported product (making normal
allowance for waste). Similarly, drawback schemes can allow for the
remission or drawback of import charges levied on inputs that are
consumed in the production of the exported product (making normal
allowance for waste).
2. The
Illustrative List of Export Subsidies in Annex I of this Agreement
makes reference to the term “inputs that are consumed in the
production of the exported product” in paragraphs (h) and
(i). Pursuant to paragraph (h), indirect tax rebate schemes can
constitute an export subsidy to the extent that they result in
exemption, remission or deferral of prior stage cumulative
indirect taxes in excess of the amount of such taxes actually levied
on inputs that are consumed in the production of the exported
product. Pursuant to paragraph (i), drawback schemes can constitute
an export subsidy to the extent that they result in a remission or
drawback of import charges in excess of those actually levied on
inputs that are consumed in the production of the exported product.
Both paragraphs stipulate that normal allowance for waste must be
made in findings regarding consumption of inputs in the production of
the exported product. Paragraph (i) also provides for substitution,
where appropriate.
II
In
examining whether inputs are consumed in the production of the
exported product, as part of a countervailing duty investigation
pursuant to this Agreement, investigating authorities should proceed
on the following basis:
1. Where
it is alleged that an indirect tax rebate scheme, or a drawback
scheme, conveys a subsidy by reason of over rebate or excess
drawback of indirect taxes or import charges on inputs consumed in
the production of the exported product, the investigating authorities
should first determine whether the government of the exporting Member
has in place and applies a system or procedure to confirm which
inputs are consumed in the production of the exported product and in
what amounts. Where such a system or procedure is determined to be
applied, the investigating authorities should then examine the system
or procedure to see whether it is reasonable, effective for the
purpose intended, and based on generally accepted commercial
practices in the country of export. The investigating authorities
may deem it necessary to carry out, in accordance with paragraph 6
of Article 12, certain practical tests in order to verify
information or to satisfy themselves that the system or procedure is
being effectively applied.
2. Where
there is no such system or procedure, where it is not reasonable, or
where it is instituted and considered reasonable but is found not to
be applied or not to be applied effectively, a further examination by
the exporting Member based on the actual inputs involved would need
to be carried out in the context of determining whether an excess
payment occurred. If the investigating authorities deemed it
necessary, a further examination would be carried out in accordance
with paragraph 1.
3. Investigating
authorities should treat inputs as physically incorporated if such
inputs are used in the production process and are physically present
in the product exported. The Members note that an input need not be
present in the final product in the same form in which it entered the
production process.
4. In
determining the amount of a particular input that is consumed in the
production of the exported product, a “normal allowance for
waste” should be taken into account, and such waste should be
treated as consumed in the production of the exported product. The
term “waste” refers to that portion of a given input which
does not serve an independent function in the production process, is
not consumed in the production of the exported product (for reasons
such as inefficiencies) and is not recovered, used or sold by the
same manufacturer.
5. The
investigating authority's determination of whether the claimed
allowance for waste is “normal” should take into account
the production process, the average experience of the industry in the
country of export, and other technical factors, as appropriate. The
investigating authority should bear in mind that an important
question is whether the authorities in the exporting Member have
reasonably calculated the amount of waste, when such an amount is
intended to be included in the tax or duty rebate or remission.
ANNEX III
GUIDELINES IN THE DETERMINATION OF SUBSTITUTION
DRAWBACK SYSTEMS AS EXPORT SUBSIDIES
I
Drawback
systems can allow for the refund or drawback of import charges on
inputs which are consumed in the production process of another
product and where the export of this latter product contains domestic
inputs having the same quality and characteristics as those
substituted for the imported inputs. Pursuant to paragraph (i) of
the Illustrative List of Export Subsidies in Annex I,
substitution drawback systems can constitute an export subsidy to the
extent that they result in an excess drawback of the import charges
levied initially on the imported inputs for which drawback is being
claimed.
II
In
examining any substitution drawback system as part of a
countervailing duty investigation pursuant to this Agreement,
investigating authorities should proceed on the following basis:
1. Paragraph
(i) of the Illustrative List stipulates that home market inputs may
be substituted for imported inputs in the production of a product for
export provided such inputs are equal in quantity to, and have the
same quality and characteristics as, the imported inputs being
substituted. The existence of a verification system or procedure is
important because it enables the government of the exporting Member
to ensure and demonstrate that the quantity of inputs for which
drawback is claimed does not exceed the quantity of similar products
exported, in whatever form, and that there is not drawback of import
charges in excess of those originally levied on the imported inputs
in question.
2. Where
it is alleged that a substitution drawback system conveys a subsidy,
the investigating authorities should first proceed to determine
whether the government of the exporting Member has in place and
applies a verification system or procedure. Where such a system or
procedure is determined to be applied, the investigating authorities
should then examine the verification procedures to see whether they
are reasonable, effective for the purpose intended, and based on
generally accepted commercial practices in the country of export.
To the extent that the procedures are determined to meet this test
and are effectively applied, no subsidy should be presumed to exist.
It may be deemed necessary by the investigating authorities to carry
out, in accordance with paragraph 6 of Article 12, certain
practical tests in order to verify information or to satisfy
themselves that the verification procedures are being effectively
applied.
3. Where
there are no verification procedures, where they are not reasonable,
or where such procedures are instituted and considered reasonable but
are found not to be actually applied or not applied effectively,
there may be a subsidy. In such cases a further examination by the
exporting Member based on the actual transactions involved would need
to be carried out to determine whether an excess payment occurred.
If the investigating authorities deemed it necessary, a further
examination would be carried out in accordance with paragraph 2.
4. The
existence of a substitution drawback provision under which exporters
are allowed to select particular import shipments on which drawback
is claimed should not of itself be considered to convey a subsidy.
5. An
excess drawback of import charges in the sense of paragraph (i)
would be deemed to exist where governments paid interest on any
monies refunded under their drawback schemes, to the extent of the
interest actually paid or payable.
ANNEX IV
CALCULATION OF THE TOTAL AD VALOREM SUBSIDIZATION
(PARAGRAPH 1(A) OF ARTICLE 6)
1. Any
calculation of the amount of a subsidy for the purpose of
paragraph 1(a) of Article 6 shall be done in terms of the
cost to the granting government.
2. Except
as provided in paragraphs 3 through 5, in determining whether the
overall rate of subsidization exceeds 5 per cent of the value of the
product, the value of the product shall be calculated as the total
value of the recipient firm's sales in the most recent 12-month period, for which sales data is
available, preceding the period in which the subsidy is granted.
3. Where
the subsidy is tied to the production or sale of a given product, the
value of the product shall be calculated as the total value of the
recipient firm's sales of that product in the most recent 12-month
period, for which sales data is available, preceding the period in
which the subsidy is granted.
4. Where
the recipient firm is in a start up situation, serious prejudice
shall be deemed to exist if the overall rate of subsidization exceeds
15 per cent of the total funds invested. For purposes of this
paragraph, a start up period will not extend beyond the first
year of production.
5. Where
the recipient firm is located in an inflationary economy country, the
value of the product shall be calculated as the recipient firm's
total sales (or sales of the relevant product, if the subsidy is
tied) in the preceding calendar year indexed by the rate of inflation
experienced in the 12 months preceding the month in which the subsidy
is to be given.
6. In
determining the overall rate of subsidization in a given year,
subsidies given under different programmes and by different
authorities in the territory of a Member shall be aggregated.
7. Subsidies
granted prior to the date of entry into force of the WTO Agreement,
the benefits of which are allocated to future production, shall be
included in the overall rate of subsidization.
8. Subsidies which are non actionable under relevant provisions
of this Agreement shall not be included in the calculation of the
amount of a subsidy for the purpose of paragraph 1(a) of
Article 6.
ANNEX V
PROCEDURES FOR DEVELOPING INFORMATION CONCERNING SERIOUS PREJUDICE
1. Every
Member shall cooperate in the development of evidence to be examined
by a panel in procedures under paragraphs 4 through 6 of
Article 7. The parties to the dispute and any third country
Member concerned shall notify to the DSB, as soon as the provisions
of paragraph 4 of Article 7 have been invoked, the
organization responsible for administration of this provision within
its territory and the procedures to be used to comply with requests
for information.
2. In
cases where matters are referred to the DSB under paragraph 4 of
Article 7, the DSB shall, upon request, initiate the procedure
to obtain such information from the government of the subsidizing
Member as necessary to establish the existence and amount of
subsidization, the value of total sales of the subsidized firms, as
well as information necessary to analyze the adverse effects caused
by the subsidized product. This process may include, where appropriate, presentation of
questions to the government of the subsidizing Member and of the
complaining Member to collect information, as well as to clarify and
obtain elaboration of information available to the parties to a
dispute through the notification procedures set forth in Part VII.
3. In the
case of effects in third-country markets, a party to a dispute may
collect information, including through the use of questions to the
government of the third-country Member, necessary to analyse adverse
effects, which is not otherwise reasonably available from the
complaining Member or the subsidizing Member. This requirement
should be administered in such a way as not to impose an unreasonable
burden on the third country Member. In particular, such a
Member is not expected to make a market or price analysis specially
for that purpose. The information to be supplied is that which is
already available or can be readily obtained by this Member (e.g.
most recent statistics which have already been gathered by relevant
statistical services but which have not yet been published, customs
data concerning imports and declared values of the products
concerned, etc.). However, if a party to a dispute undertakes a
detailed market analysis at its own expense, the task of the person
or firm conducting such an analysis shall be facilitated by the
authorities of the third country Member and such a person or
firm shall be given access to all information which is not normally
maintained confidential by the government.
4. The DSB
shall designate a representative to serve the function of
facilitating the information gathering process. The sole
purpose of the representative shall be to ensure the timely
development of the information necessary to facilitate expeditious
subsequent multilateral review of the dispute. In particular, the
representative may suggest ways to most efficiently solicit necessary
information as well as encourage the cooperation of the parties.
5. The
information gathering process outlined in paragraphs 2
through 4 shall be completed within 60 days of the date on which
the matter has been referred to the DSB under paragraph 4 of
Article 7. The information obtained during this process shall
be submitted to the panel established by the DSB in accordance with
the provisions of Part X. This information should include, inter alia, data concerning the amount of the subsidy in
question (and, where appropriate, the value of total sales of the
subsidized firms), prices of the subsidized product, prices of the
non subsidized product, prices of other suppliers to the market,
changes in the supply of the subsidized product to the market in
question and changes in market shares. It should also include
rebuttal evidence, as well as such supplemental information as the
panel deems relevant in the course of reaching its conclusions.
6. If the
subsidizing and/or third country Member fail to cooperate in the
information gathering process, the complaining Member will
present its case of serious prejudice, based on evidence available to
it, together with facts and circumstances of the non-cooperation of
the subsidizing and/or third country Member. Where information
is unavailable due to non-cooperation by the subsidizing and/or
third country Member, the panel may complete the record as
necessary relying on best information otherwise available.
7. In
making its determination, the panel should draw adverse inferences
from instances of non-cooperation by any party involved in the
information gathering process.
8. In
making a determination to use either best information available or
adverse inferences, the panel shall consider the advice of the DSB
representative nominated under paragraph 4 as to the
reasonableness of any requests for information and the efforts made
by parties to comply with these requests in a cooperative and timely
manner.
9. Nothing
in the information gathering process shall limit the ability of
the panel to seek such additional information it deems essential to
a proper resolution to the dispute, and which was not adequately
sought or developed during that process. However, ordinarily the
panel should not request additional information to complete the
record where the information would support a particular party's
position and the absence of that information in the record is the
result of unreasonable non-cooperation by that party in the
information gathering process.
ANNEX VI
PROCEDURES FOR ON THE SPOT INVESTIGATIONS PURSUANT TO PARAGRAPH 6 OF ARTICLE 12
1. Upon
initiation of an investigation, the authorities of the exporting
Member and the firms known to be concerned should be informed of the
intention to carry out on the spot investigations.
2. If in
exceptional circumstances it is intended to include non governmental
experts in the investigating team, the firms and the authorities of
the exporting Member should be so informed. Such non governmental
experts should be subject to effective sanctions for breach of
confidentiality requirements.
3. It
should be standard practice to obtain explicit agreement of the firms
concerned in the exporting Member before the visit is finally
scheduled.
4. As soon
as the agreement of the firms concerned has been obtained, the
investigating authorities should notify the authorities of the
exporting Member of the names and addresses of the firms to be
visited and the dates agreed.
5. Sufficient
advance notice should be given to the firms in question before the
visit is made.
6. Visits
to explain the questionnaire should only be made at the request of an
exporting firm. In case of such a request the investigating
authorities may place themselves at the disposal of the firm; such a
visit may only be made if (a) the authorities of the importing
Member notify the representatives of the government of the Member in
question and (b) the latter do not object to the visit.
7. As the
main purpose of the on the spot investigation is to verify
information provided or to obtain further details, it should be
carried out after the response to the questionnaire has been received
unless the firm agrees to the contrary and the government of the
exporting Member is informed by the investigating authorities of the
anticipated visit and does not object to it; further, it should be
standard practice prior to the visit to advise the firms concerned of
the general nature of the information to be verified and of any
further information which needs to be provided, though this should
not preclude requests to be made on the spot for further details to
be provided in the light of information obtained.
8. Enquiries
or questions put by the authorities or firms of the exporting Members
and essential to a successful on the spot investigation
should, whenever possible, be answered before the visit is made.
ANNEX VII
DEVELOPING COUNTRY MEMBERS REFERRED TO
IN PARAGRAPH 2(A) OF ARTICLE 27
The
developing country Members not subject to the provisions of
paragraph 1(a) of Article 3 under the terms of
paragraph 2(a) of Article 27 are:
(a) Least developed countries designated as such by the United
Nations which are Members of the WTO.
(b) Each of the following developing countries which are Members of
the WTO shall be subject to the provisions which are applicable to
other developing country Members according to paragraph 2(b) of
Article 27 when GNP per capita has reached $1,000 per annum:
Bolivia, Cameroon, Congo, Côte d'Ivoire, Dominican Republic,
Egypt, Ghana, Guatemala, Guyana, Honduras, India, Indonesia,
Kenya, Morocco, Nicaragua, Nigeria, Pakistan, Philippines, Senegal,
Sri Lanka and Zimbabwe.
ANNEX VIII
FISHERIES SUBSIDIES
Article I
Prohibition of Certain Fisheries Subsidies
I.1 Except
as provided for in Articles II and III, or in the exceptional case of
natural disaster relief,
the following subsidies within the meaning of paragraph 1 of Article
1, to the extent they are specific within the meaning of paragraph 2
of Article 1, shall be prohibited:
(a) Subsidies the benefits of which are conferred on the
acquisition, construction, repair, renewal, renovation,
modernization, or any other modification of fishing vessels or service vessels,
including subsidies to boat building or shipbuilding facilities for
these purposes.
(b) Subsidies the benefits of which are conferred on transfer of
fishing or service vessels to third countries, including through the
creation of joint enterprises with third country partners.
(c) Subsidies the benefits of which are conferred on operating
costs of fishing or service vessels (including licence fees or
similar charges, fuel, ice, bait, personnel, social charges,
insurance, gear, and at-sea support); or of landing, handling or in-
or near-port processing activities for products of marine wild
capture fishing; or subsidies to cover operating losses of such
vessels or activities.
(d) Subsidies in respect of, or in the form of, port
infrastructure or other physical port facilities exclusively or
predominantly for activities related to marine wild capture fishing
(for example, fish landing facilities, fish storage facilities, and
in- or near-port fish processing facilities).
(e) Income support for natural or legal persons engaged in marine
wild capture fishing.
(f) Price support for products of marine wild capture fishing.
(g) Subsidies arising from the further transfer, by a payer
Member government, of access rights that it has acquired from another
Member government to fisheries within the jurisdiction of such other
Member.
(h) Subsidies the benefits of which are conferred on any vessel
engaged in illegal, unreported or unregulated fishing.
I.2 In addition to the prohibitions listed in paragraph 1, any
subsidy referred to in paragraphs 1 and 2 of Article 1 the benefits
of which are conferred on any fishing vessel or fishing activity
affecting fish stocks that are in an unequivocally overfished
condition shall be prohibited.
Article II
General Exceptions
Notwithstanding the provisions of Article I, and subject to the
provision of Article V:
(a) For the purposes of Article I.1(a), subsidies exclusively for
improving fishing or service vessel and crew safety shall not be
prohibited, provided that:
(1) such subsidies do not involve new vessel construction or
vessel acquisition;
(2) such subsidies do not give rise to any increase in marine
wild capture fishing capacity of any fishing or service vessel, on
the basis of gross tonnage, volume of fish hold, engine power, or on
any other basis, and do not have the effect of maintaining in
operation any such vessel that otherwise would be withdrawn; and
(3) the improvements are undertaken to comply with safety
standards.
(b) For the purposes of Articles I.1(a) and I.1(c) the following
subsidies shall not be prohibited:
subsidies exclusively for: (1) the adoption of gear for
selective fishing techniques; (2) the adoption of other techniques
aimed at reducing the environmental impact of marine wild capture
fishing; (3) compliance with fisheries management regimes aimed at
sustainable use and conservation (e.g., devices for Vessel Monitoring
Systems); provided that the subsidies do not give rise to any
increase in the marine wild capture fishing capacity of any fishing
or service vessel, on the basis of gross tonnage, volume of fish
hold, engine power, or on any other basis, and do not have the effect
of maintaining in operation any such vessel that otherwise would be
withdrawn.
(c) For the purposes of Article I.1(c), subsidies to cover
personnel costs shall not be interpreted as including:
(1) subsidies exclusively for re-education, retraining or
redeployment of fishworkers into occupations unrelated to marine wild capture fishing or directly
associated activities; and
(2) subsidies exclusively for early retirement or permanent
cessation of employment of fishworkers as a result of government
policies to reduce marine wild capture fishing capacity or effort.
(d) Nothing in Article I shall prevent subsidies for vessel
decommissioning or capacity reduction programmes, provided that:
(1) the vessels subject to such programmes are scrapped or
otherwise permanently and effectively prevented from being used for
fishing anywhere in the world;
(2) the fish harvesting rights associated with such vessels,
whether they are permits, licences, fish quotas or any other form of
harvesting rights, are permanently revoked and may not be reassigned;
(3) the owners of such vessels, and the holders of such fish
harvesting rights, are required to relinquish any claim associated
with such vessels and harvesting rights that could qualify such
owners and holders for any present or future harvesting rights in
such fisheries; and
(4) the fisheries management system in place includes management
control measures and enforcement mechanisms designed to prevent
overfishing in the targeted fishery. Such fishery-specific measures
may include limited entry systems, catch quotas, limits on fishing
effort or allocation of exclusive quotas to vessels, individuals
and/or groups, such as individual transferable quotas.
(e) Nothing in Article I shall prevent governments from making
user-specific allocations to individuals and groups under limited
access privileges and other exclusive quota programmes.
Article III
Special and Differential Treatment of Developing Country
Members
III.1 The
prohibition of Article 3.1(c) and Article I shall not apply to
least-developed country (“LDC”) Members.
III.2 For
developing country Members other than LDC Members:
(a) Subsidies referred to in Article I.1 shall not be prohibited
where they relate exclusively to marine wild capture fishing
performed on an inshore basis (i.e., within the territorial waters of
the Member) with non-mechanized net-retrieval, provided that (1) the
activities are carried out on their own behalf by fishworkers, on an
individual basis which may include family members, or organized in
associations; (2) the catch is consumed principally by the
fishworkers and their families and the activities do not go beyond a
small profit trade; and (3) there is no major employer-employee
relationship in the activities carried out. Fisheries management
measures aimed at ensuring sustainability, such as the measures
referred to in Article V, should be implemented in respect of the
fisheries in question, adapted as necessary to the particular
situation, including by making use of indigenous fisheries management
institutions and measures.
(b) In addition, subject to the provisions of Article V:
(1) Subsidies referred to in Articles I.1(d), I.1(e) and I.1(f)
shall not be prohibited.
(2) Subsidies referred to in Article I.1(a) and I.1(c) shall not
be prohibited provided that they are used exclusively for marine wild
capture fishing employing decked vessels not greater than 10 meters
or 34 feet in length overall, or undecked vessels of any length.
(3) For fishing and service vessels of such Members other than
the vessels referred to in paragraph (b)(2), subsidies referred to in
Article I.1(a) shall not be prohibited provided that (i) the vessels
are used exclusively for marine wild capture fishing activities of
such Members in respect of particular, identified target stocks
within their Exclusive Economic Zones (“EEZ”); (ii) those
stocks have been subject to prior scientific status assessment
conducted in accordance with relevant international standards, aimed
at ensuring that the resulting capacity does not exceed a sustainable
level; and (iii) that assessment has been subject to peer review in
the relevant body of the United Nations Food and Agriculture
Organization (“FAO”).
III.3 Subsidies
referred to in Article I.1(g) shall not be prohibited where the
fishery in question is within the EEZ of a developing country Member,
provided that the agreement pursuant to which the rights have been
acquired is made public, and contains provisions designed to prevent
overfishing in the area covered by the agreement based on
internationally-recognized best practices for fisheries management
and conservation as reflected in the relevant provisions of
international instruments aimed at ensuring the sustainable use and
conservation of marine species, such as, inter alia, the Agreement for the Implementation of the Provisions of the United
Nations Convention on the Law of the Sea of 10 December 1982 Relating
to the Conservation and Management of Straddling Fish Stocks and
Highly Migratory Fish Stocks (“Fish Stocks Agreement”),
the Code of Conduct on Responsible Fisheries of the Food and
Agriculture Organization (“Code of Conduct”),
the Agreement to Promote Compliance with International
Conservation and Management Measures by Fishing Vessels on the High
Seas (“Compliance Agreement”), and technical
guidelines and plans of action (including criteria and precautionary
reference points) for the implementation of these instruments, or
other related or successor instruments. These provisions shall
include requirements and support for science-based stock assessment
before fishing is undertaken pursuant to the agreement and for
regular assessments thereafter, for management and control measures,
for vessel registries, for reporting of effort, catches and discards
to the national authorities of the host Member and to relevant
international organizations, and for such other measures as may be
appropriate.
III.4 Members
shall give due regard to the needs of developing country Members in
complying with the requirements of this Annex, including the
conditions and criteria set forth in this Article and in Article V,
and shall establish mechanisms for, and facilitate, the provision of
technical assistance in this regard, bilaterally and/or through the
appropriate international organizations.
Article IV
General Discipline on the Use of Subsidies
IV.1 No Member shall cause, through the use of any subsidy
referred to in paragraphs 1 and 2 of Article 1, depletion of or harm
to, or creation of overcapacity in respect of, (a) straddling or
highly migratory fish stocks whose range extends into the EEZ of
another Member; or (b) stocks in which another Member has
identifiable fishing interests, including through user-specific quota
allocations to individuals and groups under limited access privileges
and other exclusive quota programmes. The existence of such
situations shall be determined taking into account available
pertinent information, including from other relevant international
organizations. Such information shall include the status of the
subsidizing Member's implementation of internationally-recognized
best practices for fisheries management and conservation as reflected
in the relevant provisions of international instruments aimed at the
sustainable use and conservation of marine species, such as, inter
alia, the Fish Stocks Agreement, the Code of
Conduct, the Compliance Agreement, and technical
guidelines and plans of action (including criteria and precautionary
reference points) for the implementation of these instruments, or
other related or successor instruments.
IV.2 Any
subsidy referred to in this Annex shall be attributable to the Member
conferring it, regardless of the flag(s) of the vessel(s) involved or
the application of rules of origin to the fish involved.
Article V
Fisheries Management
V.1 Any
Member granting or maintaining any subsidy as referred to in Article
II or Article III.2(b) shall operate a fisheries management
system regulating marine wild capture fishing within its
jurisdiction, designed to prevent overfishing. Such management
system shall be based on internationally-recognized best practices
for fisheries management and conservation as reflected in the
relevant provisions of international instruments aimed at ensuring
the sustainable use and conservation of marine species, such as, inter alia, the Fish Stocks Agreement,
the Code of Conduct, the Compliance Agreement,
technical guidelines and plans of action (including criteria and
precautionary reference points) for the implementation of these
instruments, or other related or successor instruments. The system
shall include regular science-based stock assessment, as well as
capacity and effort management measures, including harvesting
licences or fees; vessel registries; establishment and allocation
of fishing rights, or allocation of exclusive quotas to vessels,
individuals and/or groups, and related enforcement mechanisms;
species-specific quotas, seasons and other stock management measures;
vessel monitoring which could include electronic tracking and
on-board observers; systems for reporting in a timely and reliable
manner to the competent national authorities and relevant
international organizations data on effort, catch and discards in
sufficient detail to allow sound analysis; and research and other
measures related to conservation and stock maintenance and
replenishment. To this end, the Member shall adopt and implement
pertinent domestic legislation and administrative or judicial
enforcement mechanisms. It is desirable that such fisheries
management systems be based on limited access privileges.
Information as to the nature and operation of these systems,
including the results of the stock assessments performed, shall be
notified to the relevant body of the FAO, where it shall be subject
to peer review prior to the granting of the subsidy.
References for such legislation and mechanism, including for any
modifications thereto, shall be notified to the Committee on
Subsidies and Countervailing Measures (“the Committee”)
pursuant to the provisions of Article VI.4.
V.2 Each
Member shall maintain an enquiry point to answer all reasonable
enquiries from other Members and from interested parties in other
Members concerning its fisheries management system, including
measures in place to address fishing capacity and fishing effort, and
the biological status of the fisheries in question. Each Member
shall notify to the Committee contact information for this enquiry
point.
Article VI
Notifications and Surveillance
VI.1 Each Member shall notify to the Committee in advance of its
implementation any measure for which that Member invokes the
provisions of Article II or Article III.2; except that any subsidy
for natural disaster relief shall be notified to the Committee without delay.
In addition to the information notified pursuant to Article 25, any
such notification shall contain sufficiently precise information to
enable other Members to evaluate whether or not the conditions and
criteria in the applicable provisions of Article II or Article III.2
are met.
VI.2 Each
Member that is party to an agreement pursuant to which fishing rights
are acquired by a Member government (“payer Member”) from
another Member government to fisheries within the jurisdiction of
such other Member shall publish that agreement, and shall notify to
the Committee the publication references for it.
VI.3 The
terms on which a payer Member transfers fishing rights it has
obtained pursuant to an agreement as referred to in paragraph 2 shall
be notified to the Committee by the payer Member in respect of each
such agreement.
VI.4 Each
Member shall include in its notifications to the Committee the
references for its applicable domestic legislation and for its
notifications made to other organizations, as well as for the
documents related to the reviews conducted by those organizations, as
referred to in Article V.1.
VI.5 Other
Members shall have the right to request information about the
notified subsidies, including about individual cases of
subsidization, about notified agreements pursuant to which fishing
rights are acquired, and about the stock assessments and management
systems notified to other organizations pursuant to Article V.1.
Each Member so requested shall provide such information in accordance
with the provisions of Article 25.9.
VI.6 Any
Member shall be free to bring to the attention of the Committee
information from pertinent outside sources (including
intergovernmental organizations with fisheries management-related
activities, regional fisheries management organizations and similar
sources) as to any apparent illegal, unreported and unregulated
fishing activities.
VI.7 Measures
notified pursuant to this Article shall be subject to review by the
Committee as provided for in Article 26.
Article VII
Transitional Provisions
VII.1 Any
subsidy programme which has been established within the territory of
any Member before the date of entry into force of the results of the
DDA and which is inconsistent with Article 3.1(c) and
Article I shall be notified to the Committee not later than 90 days,
or in the case of a developing country Member 180 days, after the
date of entry into force of the results of the DDA.
VII.2 Provided
that a programme has been notified pursuant to paragraph 1, a Member
shall have two years, or in the case of a developing country Member
four years, from the date of entry into force of the results of the
DDA to bring that programme into conformity with Article 3.1(c) and
Article I, during which period the programme shall not be subject to
those provisions.
VII.3 No
Member shall extend the scope of any programme, nor shall a programme
be renewed upon its expiry.
Article VIII
Dispute Settlement
VIII.1 Where
a measure is the subject of dispute settlement claims pursuant to
Article 3.1(c) and Article I, the relevant provisions of Article 4
and of this Article shall apply. Article 30 and the relevant
provisions of this Article shall apply to disputes arising under
other provisions of this Annex.
VIII.2 Where
a subsidy that has not been notified as required by Article VI.1 is
the subject of dispute settlement pursuant to the DSU and Article 4,
such subsidy shall be presumed to be prohibited pursuant to Article
3.1(c) and Article I. It shall be for the subsidizing Member to
demonstrate that the subsidy in question is not prohibited.
VIII.3 Where
a further transfer of access rights as referred to in Article I.1(g)
is the subject of a dispute arising under this Annex, and the terms
of that transfer have not been notified as required by Article VI.3,
the transfer shall be presumed to give rise to a subsidy. It shall
be for the payer Member to demonstrate that no such subsidy has
arisen.
VIII.4 Where
a dispute arising under this Annex raises scientific or technical
questions related to fisheries, the panel should seek advice from
fisheries experts chosen by the panel in consultation with the
parties. To this end, the panel may, when it deems it appropriate,
establish an advisory technical fisheries expert group, or consult
recognized and competent international organizations, at the request
of either party to the dispute or on its own initiative.
VIII.5 Nothing
in this Annex shall impair the rights of Members to resort to the
good offices or dispute settlement mechanisms of other international
organizations or under other international agreements.
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