./.RESTRICTEDWORLD TRADE
ORGANIZATIONG/ADP/AHG/W/103
25 October 2000
(00-4448)
Committee on Anti-Dumping Practices
Ad Hoc Group on ImplementationOriginal:  English
QUESTIONS RAISED BY MEMBERS CONCERNING PRACTICAL ISSUES
AND EXPERIENCE IN APPLYING ARTICLE 2.4.2
Comments by Brazil
The following communication, dated 25 October 2000, has been received from the Permanent
Mission of Brazil.
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Pursuant to the questions listed by the Secretariat in document G/ADP/AHG/W/94, Brazil
hereby submits additional comments to those made in document G/ADP/AHG/W/90, about the
implementation of Article 2.4.2 of the Agreement on Anti-Dumping.
Questions 1 to 3 - Brazil considers that the provisions of Article 2.4.2 apply to the
determination of dumping margins – preliminary or final – in the original investigation, to reviews of
the anti-dumping duties, and to refunding procedures under Article 9.3.  As mentioned in Brazil’s
previous document on this issue, the two first methods of Article 2.4.2 are the options available to the
Member, while the third method may be used only if  the conditions mentioned in that Article are
present.
Question 4 - Apparently most Members have chosen to use the weighed average-to-weighed
average method.  Therefore, it would be useful if Members that employ the transaction-to-transaction
method provide information concerning the criteria used to select the transactions (including those
Members that do not apply this method but that have developed such criteria).  This proposal aims atpromoting a discussion on this issue within the Ad Hoc Group, with a view to develop a
recommendation by the Committee establishing transaction selection criteria that may ensure a neutral
and predictable use of this method.
Brazil further proposes an agreement by Members that, while there is no multilateral
understanding on criteria for the selection of th e methods described in Article 2.4.2, whenever a
Member changes its practice to use one particular methodology in favor of another in a specific
investigation, a detailed justification of the decision to change the methodology must be provided in
the public notice or separate report.
Question 6 - It is not clear to Brazil why mention is made to the behavior of the domestic
industry.  Brazil believes that the determination of the margin of dumping should reflect the behavior
of the exporter only.G/ADP/AHG/W/103
Page 2
Question 7 - Brazil understands, from the outset, that sampling is not allowed for the selection
of transactions of an exporter/foreign producer, product type, etc1.  Once the sample of producers for
an investigation has been defined, all export transactions and sales in the domestic market by the
companies of the sample are subject to examination.  When the transaction-to-transaction
methodology is applied, each export transaction must be compared to a specific  sale that took place in
the domestic market at the closest possible period.  It is precisely to avoid the situation described in
question 17 that Brazil proposes the adoption of neutral criteria to establish which domestic market
transactions are comparable.
Question 10 -  Brazil maintains that it is enough to have the weighed average, calculated for
the investigated company and for the investigated  product, below 2%.  Not all margins have to be
under that threshold.
Question 14 – The use of cost of production for determining normal value does not restrict the
use of the comparison methodologies of Article 2.4.2, as long as the investigating authority calculates
the cost of production in a way that is compatible with the methodology it chose to apply.  When
using weighed average-to-weighed average, the in vestigating authority must calculate the weighed
average cost of production relative to the dumping investigation period.  When the transaction-to-
transaction method is used, one should use the cost of production corresponding to each export
transaction.
Question 15 – Under any circumstances, the critical point here is that the starting point of the
analysis must be the product under investigation, that is, the  exported product
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1 For this reason, Brazil does not fully understand the situations described in questions 11 and 13.