RESTRICTED
WORLD TRADE G/ADP/W/169
G/SCM/W/176
ORGANIZATION 24November 1995
(95-3718)
Original: English Committee onAnti-Dumping Practices
Committee onSubsidies andCountervailing Measures
QUESTIONS CONCERNING THE NOTIFICATIONS PROVIDED
BYJAPAN1OFLAWS AND REGULATIONS UNDER
ARTICLES 18.5AND 32.6OFTHE AGREEMENTS
Thefollowing communication, dated 14November 1995, hasbeenreceived fromthePermanent
Mission ofKorea.
_______________
1. General Questions
(a) Incases where there arenorelevant provisions inthedomestic legislation, doestheWTO
Agreement apply?
(b) Iftheprovisions oftheexisting domestic legislation donotconform totheWTO Agreement,
dotheprovisions oftheWTO Agreement apply?
2. Market Viability
Cabinet Order 2.2prescribes thattheprices insub-paragraphs (2)or(3)ofOrder 2.1may
beusedonlywhere thereisnopriceforthelikeproduct inthesupplying country orwhere itisdeemed
inadequate tousetheprice because oftheparticular market situation orlowsalesvolume.
Could Japan explain itsstandard fordetermining lowsalesvolume? TheWTO Agreement
stipulates 5percentormore ofthesales oftheproduct inthedomestic market tobeconsidered a
sufficient quantity forthenormal value.
3. Constructed Export Price
Cabinet Order 3prescribes thatincases where theexport price isnotdeemed adequate touse
because oftheassociation between theexporter andimporter, theexport price would becalculated
onthebasis oftheprice atwhich theproducts arefirstresold toanyperson whoisnotassociated.
Further, theOrder prescribes thatthepricefordomestic saleoftheproduct soldafterhaving processed
theimported products asrawmaterial istheprice atwhich theyaresoldminus thevalue added by
suchproduction.
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Could Japan clarify whatitmeans by"value added bysuchproduction"? Could Japan explain
whatcostsandprofits itwilladjust asallowances between importation andresale? More specifically,
could Japan explain thecalculation method ofvalue added andprofits deductible?
4. DueAllowance
Does the"necessary adjustment" incabinet Order 2.3includes thedifferences inconditions
andterms ofsale,taxation, levels oftradeandphysical characteristics? Could weconsider "transaction
stages" intheorder thesame as"levels oftrade" intheWTO Agreement? Ifso,could Japan clarify
howitcalculates theadjustment forthedifference intransaction stages?
Itseems thattheOrder 2.3onlyrefers tothenormal value. Does Japan adjust thedifferences
frombothsides(export priceandnormal value) forcomparison attheex-factory, ordoesitonlyadjust
thedifferences affecting price comparability from oneside? Ifthelatter, howdoesitreconcile this
withWTO Agreement 2.4,which normally requires comparison attheex-factory level?
5. Ordinary Course ofTrade
How doesJapan define "ordinary course oftrade" incabinet Order 2.1? Does Japan adopt
thedefinition of"extended period oftime" and"substantial quantity" inArticle 2.2andfootnotes of
theWTO Agreement todecide whether thesalesareintheordinary course oftrade?
6. CostCalculation/Start-up Cost
Could Japan confirm thatitcalculates costs onthebasis ofrecords keptbytheexporter or
producer forthepurpose ofcostscalculation inCabinet Order 2.1?Could Japan clarify whether there
willbeadjustment fornon-recurring items andstart-up operation forthecostscalculation inOrder 2.1
asspecified intheWTO Agreement 2.2.1.1?
7. SG&A, Profit forC/V
OnwhatbasisdoesJapandeterminetheamountsforSG&AandprofitforthepurposeofCabinet
Order 2.1(3)? Could Japan clarify what"normal profit" means inOrder 2.1.(3)? Could Japan confirm
thatitwillbasethecalculation ofSG&A andprofit onactual datapertaining toproduction andsales
bytheexporter orproducer under investigation?
8. Comparison
Itseems thattheCustoms Tariff LaworCabinet Order relating toanti-dumping dutydoesnot
specify thecomparison method between normal value andexport transactions. Could Japan clarify
thatitestablishes theexistence ofdumping margin onthebasisofacomparison ofaweighted-average
normal value withaweighted-average export price orbyacomparison ofnormal value andexport
prices onatransaction-to-transaction basis inaccordance withArticle 2.4.2 oftheWTO Agreement?
9. Cumulative Assessment ofInjury
Could Japan clarify whether itcumulatively assesses theeffects ofsimultaneous imports from
more thanonecountry? Ifso,could Japan clarify theconditions forthecumulative assessment? Is
itconsistent withArticle 3.3oftheWTO Agreement?G/ADP/W/169
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10. Standing
Itseems thatArticle 5ofthecabinet Order onlystipulates 25percentoftotalproduction
condition asastanding requirement. Doesthismean thattheapplication shallbeconsidered asfulfilling
therequirements asfarasthe25percentproduction requirement ismetwithout testing whether it
issupported bythose domestic producers whose collective output constitutes more than50percent
ofthetotalproduction ofthelikeproduct produced bythatportion ofthedomestic industry expressing
either support fororopposition totheapplication?
11. Undertaking
Could Japan explain howArticle 8.8oftheCustoms Tariff Lawisreconciled withArticle 8.2
oftheWTO Agreement, which stipulates thatpriceundertakings shallnotbesought oraccepted from
exporters unless theauthorities oftheimporting Member have made apreliminary affirmative
determination ofdumping andinjury?
Could Japan clarify how "canbepresumed" inArticle 8.8oftheCustoms Tariff Lawcan
bereconciled with"affirmative determination" inArticle 8.2oftheWTO Agreement?
12. Sampling
Itseems thattheCustoms Tariff LaworCabinet Order doesnotstipulate thecases where the
number ofparties istoolarge tomake individual margin determination. Inthisrespect, doesJapan
always determine theindividual margin ofallexporters concerned regardless ofthenumber ofexporters?
IfJapan limits thenumber offirms tobeexamined, please clarify theconditions.
13. DeMinimis /Negligible Volume
Could Japan confirm thatthere shallbeimmediate termination incases where theauthorities
determine thatthemargin ofdumping isdeminimis orthatthevolume ofdumped imports orinjury
isnegligible? Ifso,whatisthedefinition ofthedeminimis dumping margin andnegligible imports
volume inthecustoms tariff laworcabinet order?
14. Time limitforQuestionnaire Response
DoesJapangiveexportersatleast30daystoreplytoquestionnaires,asstipulatedinArticle6.1.1
oftheWTO Agreement?
15. Conversion ofCurrency
CouldJapanexplainwhatexchangerateitwouldusewhenthecomparisonrequiresaconversion
ofcurrencies?
DoesJapan allow adjustment forexchange ratetoreflect sustained movements during theperiod
ofinvestigation?
16. Industrial Users orConsumer Organizations
Does Japan provide opportunities forindustrial users orconsumer organizations toprovide
information asspecified inArticle 6.12oftheWTO Agreement?G/ADP/W/169
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17. Judicial Review
Could Japan clarify whether independent judicial, arbitral oradministrative tribunals or
procedures areavailable? Please explain therelevant laworregulation andprocedures forfiling judicial
review.