 WORLD TRADE  
ORGANIZATION  TN/RL/GEN/20 
15 September 2004 
 (04-3860) 
Negotiating Group on Rules Original:   English 
   
PROPOSAL ON FACTS AVAILABLE 
 
Communication from Brazil;  Chile;  Colomb ia;  Costa Rica;  Hong Kong, China;
   
Japan;  Korea;  Norway;  Singapore;  Switzerland;  the Separate Customs  
Territory of Taiwan, Penghu, Kinmen and Matsu;  and Thailand  
 
  The following communication, dated 13 September 2004, is being circulated at the request of 
the Delegations of Brazil;  Chile;  Colombia;  Co sta Rica;  Hong Kong, China;  Japan;  Korea;  
Norway;  Singapore;  Switzerland;  the Separate  Customs Territory of Taiwan, Penghu, Kinmen and 
Matsu;  and Thailand.  
 The submitting delegations have requested that this paper, which was submitted to the Rules 
Negotiating Group as an informal document (JOB(04)/ 126), also be circulated as a formal document. 
_______________ 
  
I. DESCRIPTION OF THE PROBLEM 
 The basic objective of AD measures is to o ffset dumping only to the extent necessary to 
address injury to a domestic industry.  Important task  for the investigating authorities is to determine 
the margin of dumping by appropriately reflecting th e extent of the dumping by responding parties.  
The best source of information for an appropriate calculation of the margin of dumping is the actual 
sales and cost data of responding parties.  In so me cases, however, the authorities may not be able to 
obtain all necessary data, but must nonetheless complete  the proceeding within the prescribed period.  
To address such situations, the AD Agreement allows  authorities in certain situations to base their 
findings on information from secondary sources kn own as facts available. The basic objective of 
permitting use of facts available is, therefore, to ba lance the requirement to complete the appropriate 
calculation of the margins of dumping and the require ment to complete an AD proceeding within the 
time period prescribed.   Notwithstanding the limited objectives in usin g facts available, there are many cases where 
excessively high dumping margins are calculated based  on facts available which are adverse to the 
respondents’ interest in spite of the fact that res pondents have acted to the best of their ability and 
been cooperative. Article 6.8 and Annex II of the AD Agreement provide some guidance on the 
application of facts available.  These rules are, however, not clear enough either as to the 
circumstances under which facts availa ble may be applied or the standard for the selection of the facts 
available which may be used.  Given that the applic ation of facts available is permitted to facilitate 
investigations, there is a considerable scope fo r improvement of the rules for the purpose of 
preventing abuse of facts available, as well as strictly  limiting the application of facts available that 
“could lead to a result which is less favourable” to th e respondents.  In view of this, we put forward 
the following proposals to address the issues asso ciated with the use of facts available. 
 
 Note:  The conditions under which the author ities may request affiliated party information 
and the scope thereof will be discussed in a separate paper.  TN/RL/GEN/20 
Page 2  
 
II. ELEMENTS OF A SOLUTION 
1. Purpose of Using Facts Available 
1.1 Proposal 
 Amend the current text of Article 6.8 to explicitly  state that facts available are to be used only 
to the extent necessary to substitute missing or rejected information.  
 
Explanation 
 
− This proposal intends to clarify the current provision of Article 6.8 that facts available should 
be used only to substitute fo r necessary information that the responding party did not submit 
(“missing information”) or information th at the responding party did submit but the 
authorities rejected (“rejected information”).  As stated in the above section, the best source 
of information for accurate calculation of margins of dumping is the party’s actual data.  The authorities must use the submitted informati on when the information germane to the 
investigation is accurate and is submitted within  a reasonable period.  There is no rationale to 
reject information submitted by the responding  party and use facts available where such 
information is available as actual accurate data.   
 
2. Situation in which Facts Available Can Be Applied 
2.1 Proposal 
 Make an addition to the current text of Annex II.1.to provide that authorities may not resort to 
facts available in an investigation or review unless the authorities have made all reasonable efforts to 
obtain necessary information from respondents. To fulfil the reasonable effort requirement, the 
authority must inter alia notify the respondent in detail of information which was insufficient in the 
initial response to the authorities’ questionnaire.  The authority must also permit the respondent to 
submit the required information within a reasonable period of time from such notification. In this 
connection, “a reasonable period of time” must be determined on a case-by-case basis in the light of 
the specific circumstances of each investigation. 
 
Explanation 
 
− The first proposal intends to clarify the require ments for authorities in applying facts available 
under current Article 6.8 and Annex II.  Some cases, such as the panel report in Argentina- 
Ceramic Tiles
1 clarified these requirements.  In Argentina – Ceramic Tiles , the authorities 
resorted to facts available without informing the respondents what information the authorities 
had needed.  The panel determined that the au thorities have the initial obligation of informing 
respondents in clear and specific terms of inform ation that they need, and may not resort to 
facts available unless the authorities inform th e respondents of the information which was 
insufficient in the initial response and give an oppor tunity to provide further explanations.  In 
other cases, the condition of applying facts availabl e to the respondent is different from that to 
the petitioner.  Some authorities enforce deadlin es of submission of data or response to the 
questionnaire for respondents in a strict manner a nd apply facts available to them, while such 
authorities seldom  apply facts available even when the petitioners fail to meet deadlines and 
only provide the necessary information very late in the investigation. 
 
                                                      
1 See the panel report in Argentina - Definitive Anti-Dumping Measures on Imports of Ceramic Floor 
Tiles from Italy, WT/DS189/R (28 September 2001).  TN/RL/GEN/20 
Page 3 
 
− We will also discuss factors to consider wh en determining whether a responding party 
prepared and submitted the information “within a reasonable period of time.” 
 2.2 Proposal 
 Examine how the concept of “significant impedime nt” in Article 6.8, which may be a cause of 
misinterpretation due to its ambiguity, has been applie d, and thus whether it is appropriate to maintain 
this concept in the Agreement, and instead to add th e concept of “refusal of verification” to clarify 
that facts available can be used also in a situation where an inte rested party refuses verification of 
necessary information.    
Explanation 
 
− We also should examine whether it is necessary and appropriate to maintain the concept of 
“significant impediment” in Article 6.8, since this  standard is not necessarily relevant to the 
question of whether the submitted information is usable for accurate calculation of margins of 
dumping.  Moreover, the term “significant impe diment” is too broad a concept and has been 
used too broadly by authorities as a catch a ll excuse to use facts available to penalize 
responding parties. 
 
− We also propose to add the concept of “refusal of verification”.  This addition clarifies the 
situation in which the authorities can use fact s available by explicitly stating that facts 
available can be used also in a situation wh ere an interested party refuses verification of 
necessary information.  Inclusion of this standa rd balances the effects of the possible deletion 
of the concept of “significant impediment”.  
 
3. Method of Applying Facts Available 
3.1 Proposal 
  Amend Annex II.3 to make it mandatory for authorities to use any and all submitted information that is verifiable, germane to the inv estigation and not proven to be inaccurate, as well as 
complying with the other requirements set out in Annex II. 3.    
 
Explanation 
 
− This proposal intends to clarify that author ities must use submitted information when certain 
conditions are met, even if all of the required information has not been submitted, as the panel 
in United States--Steel Plate
2 adjudicated.  In this case, the authorities rejected the submitted 
data in its entirety, although the submitted da ta had been verified. The authorities contended 
that it may reject submitted and verified data  where the respondent had not provided all the 
information that the authorities requested.  The current text of Annex II.3, especially terms 
like "all information" and "should be taken into  account," lacks sufficient precision in this 
respect. 
 
− In addition, we also propose to add the concep t of “germane to the investigation, not proven 
to be inaccurate” to clarify that the authoriti es must use the submitted information which is 
appropriately connected with the investiga tion and has not proven to be inaccurate.   
  
 
                                                     
 
2 See the panel report in United States - Anti-dumping and Countervailing Measures on Steel Plate 
from India,  WT/DS206/R (28 June 2002). TN/RL/GEN/20 
Page 4  
 
3.2 Proposal   Amend Annex II.7 to provide that authorities sh all choose, whenever authorities resort to 
facts available in accordance with this Agreement, information from a secondary source that properly 
represents the prevailing state of the industry or th e relevant market with respect to the missing or 
rejected information.  The information shall be  chosen, where practicable, based on an objective 
examination of all information obtained by authoritie s during the course of an investigation/review in 
light of the requirements set out in Annex II.7.   In this connection, amend Article 6.6 so that the distinction between the authority’s obligation 
with respect to an “Article 6.8 situation” and the ot her situation is eliminated. For this purpose, delete 
the exception clause at the beginning of Article 6. 6 and the phrase “supplied by interested parties”.  
 
Explanation 
 
− We propose that the above standard should replace the current standard as set forth in the first 
sentence of Annex II.7.  The current text does not specify what sources the authorities should 
choose as facts available.  The current absence of  restrictions on the selection of information 
can result in prohibitively high margins of dumping.   
 
− This proposal ensures that facts available are selected so that the information used properly 
reflects the state of the same industry as that covered by the anti-dumping proceeding (investigation or review).  
 
− In this proposal, we propose that the authorities sh all, even when resorting to facts available, 
choose the appropriate information from a secondary source by examining the validity of the information.  The proposed amendment to Annex II.7 would impose on the authorities the same obligation as provided for in Article 6.6, ev en when applying facts available. Therefore, 
we propose to delete the exception clause in the beginning of Article 6.6 as well as the phrase 
"supplied by the interested parties."  The propo sal of deleting the exception clause of Article 
6.6 does not require on-the-spot verification to  the information supplied through recourse to 
facts available, although the authority must satisfy the accuracy of such information. 
 
3.3 Proposal   Improve the last sentence of Annex II.7 by clar ifying that a party shall be regarded as being 
cooperative, inter alia , if the party provided a substantial portion of the entire information requested 
by authorities and substantially all of that inform ation could be verified, or if the party made 
reasonable efforts to submit the requested informatio n in light of its ability to submit the information 
and its ability to fulfil the instructions provided by the authorities.  
Explanation 
 
− The current text of Annex II.7 does not provide any explicit guidance on situations in which a 
responding party should be regarded as cooperati ve.  The lack of clarity in the term 
“cooperative” gives the authorities too much discr etion in determining when a respondent is 
not "cooperative" and thus whether the “situa tion could lead to a result which is less 
favourable” to the respondent.  To clarify the current rules, we propose a definition of “cooperative” party.   
 
− Furthermore, in light of the purpose of the application of facts available, i.e., substituting 
missing or rejected information, the exte nt to which coopera tive and non-cooperative 
respondents may be treated differently, should be limited.  As such, the facts available  TN/RL/GEN/20 
Page 5 
 
selection standard as proposed in the previous prop osal is applicable even to the selection of 
facts available that are less favourable. 
 3.4 Proposal   Amend Annex II.6 to provide that when the aut horities resort to facts available, they must 
either in the preliminary determination or in the di sclosure pursuant to Article 6.9, provide a sufficient 
explanation of the reasons why the submitted informa tion has been totally or partially rejected and 
specifically identify the informa tion that the authorities intend to substitute for the rejected 
information.  Due regard must be given to conf idential information relating to the disclosure in 
accordance with Articles 6.4 and 6.5. 
 
Explanation 
 
− We propose a mechanism to guarantee the opportun ity for interested parties to defend their 
interests with respect to the authorities’ application and selection of facts available.   
 
− Article 6.2 requires authorities to provide inte rested parties ample opportunity to defend their 
interests. Under the current provisions of Anne x II.6, however, the authorities in fact have 
used, in certain circumstances, facts available of  some kind, in the final decision and applied a 
set of facts that had not been applied in th e preliminary determination with little or no 
warning to interested parties.  Interested parti es are, and have been, deprived of opportunity to 
comment on the change in information applied to the final determination. 
 
− By requiring authorities to provide a sufficient explanation and identify the information to be 
used as facts available in the disclosure of essential facts under Article 6.9 at the latest, the interested party will be better able to defend its  interests in accordance with Articles 6.9 and 
6.2. 
 
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