./.WORLD TRADE
ORGANIZATIONTN/RL/W/109
19 May 2003
(03-2656)
Negotiating Group on Rules Original:  English
QUESTIONS FROM HONG KONG, CHINA
ON PAPERS SUBMITTED TO THE NEGOTIATING GROUP ON RULES
The following communication, dated 14 May 2003, has been received from the Permanent
Mission of Hong Kong, China.
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Australia's Paper on "General Contribution to  the Discussion of the Negotiating Group on
Rules on the Anti-Dumping Agreement" [TN/RL/W/86]
1. We note Australia has made the point that "duty absorption arises where there appears to have
been no or insufficient increase in export price in response to the imposition of measures".  We should
be grateful for Australia's comments and clarifications on the following questions -
• In Australia's experiences, how common does the problem of "duty absorption" take place?
• What does Australia consider as "insufficient" increase in export price?
• In our view, the imposition of AD duties already serves to remove the injurious effect of
dumping.  Given this, why does Australia see the need to address the issue of "duty absorption"?
Australia's Paper on "'Like Product' wi thin the Meaning of the WTO Anti-Dumping
Agreement" [TN/RL/W/91]
2. In this submission, Australia has raised the question as to whether there would be merits for
developing separate criteria for consideration of like product under Articles 2, 3 and 4 of the Anti-
Dumping Agreement.  In this connection, we would like to seek Australia's comments and
clarifications on the following questions -
• As we see it, the definition of like product should be applied uniformly throughout the
proceedings in order to ensure consistency and predictability of the whole process.  What does
Australia see as the practical problems associated with the uniform application of the definition?
Could Australia elaborate on the justifications for adopting separate criteria for consideration of
like product for different stages of the proceedings?
• By adopting separate criteria for consideration of "like product" for dumping and injury
determinations, is it possible that substantially different products would be covered under such
determinations?  Would it be fair and appropriate to consider substantially different products forthe same proceeding?
• Australia has suggested replacing the word "identical" with "goods, which have essentially the
same physical characteristics" in the definition of "like product" under Article 2.6.  Why does
Australia consider it appropriate to abandon totally the "identical" criterion in the definition of
"like product"?  How would the proposed change relate to the second part of the definition, which
provides that in the absence of an identical product, like product shall be interpreted to meanTN/RL/W/109
Page 2
another product which has "characteristics closely resembling those of the product under
consideration"?
The United States' Paper on "Identification of Additional Issues under the Anti-dumping and
Subsidies Agreements" [TN/RL/W/98]
Cumulation
3. The United States has raised the issue as to whether cumulation of dumped import with
subsidised imports should be allowed in order to assess the effects of the unfair imports on the
domestic industry.  We would be interested to hear  the US' more detailed views on this issue, in
particular -
• Could the United States elaborate further on why it considers it appropriate to cumulate the
dumped and subsidised imports together for the purpose of considering two separate trade remedy
measures?
• Would it be fair to take into account the effects of subsidised imports in considering AD measures
(and vice versa)?
Exclusion of Companies
4. The United States has raised the idea of adding an explicit requirement to the Agreements to
the effect that examined exporter or producer found not to be dumping or found not to have received a
countervailable subsidy may not be covered by any measure resulted from the investigation.  In ourview, pursuant to Article 9.3 of the Anti-dumping Agreement and Article 19.4 of the Agreement on
Subsidies and Countervailing Measures, no anti-dumping/countervailing measures should be levied
on examined exporter or producer found not be to dumping or have received subsidy.  We should be
grateful to know whether the United States agrees with this interpretation.  Has the United States
come across actual cases which are contrary to such interpretation?
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