WORLD TRADE
ORGANIZATIONTN/RL/W/93
2 May 2003
(03-2360)
Negotiating Group on Rules Original:  English
PROPOSAL ON FACTS AVAILABLE
Paper from Brazil;  Chile;  Colombia;  Costa Rica;  Hong Kong, China;  Israel;
Japan;  Korea;  Norway;  Singapore;  Switzerland;  the Separate Customs
Territory of Taiwan, Penghu, Kinmen and Matsu; and Thailand
The following communication, dated 1 May 2003, has been received from the delegations of
Brazil;  Chile;  Colombia;  Costa Rica;  Hong Kong, China;  Israel;  Japan;  Korea;  Norway;
Singapore;  Switzerland;  the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu; and
Thailand.
_______________
This proposal concerns Facts Available.  As it will be recalled, this issue has been identified
in document TN/RL/W/6.  Another Member has re ferred to this issue in document TN/RL/W/26.
This proposal indicates one way to overcome or resolve the problem of arbitrary investigation
using information from secondary sources known as “Facts Available.”  The discussions in the
Negotiating Group may assist in improving this proposal. Consequently, we reserve our right to
modify or complement the proposal as appropriate.
In preparing and/or analyzing specific provisions, it is clear that amendment of the existing
text may have an impact on other Articles of the AD Agreement, which have so far not been explicitly
addressed.  These links cannot be fully addressed until we have seen a comprehensive overview of
proposed amendments.  Consequently, we also reserve the right to make proposals on provisions
which may not have been explicitly addressed so far for clarification or improvement.
Issue:  Facts Available
Relevant Provision: Article 6.6, 6.8 and Annex II (Article 6.1, 6.2 are also relevant)
Relevant Issues to Be Discussed Separately:
• Affiliated party transactions (definition will be identified in a separate proposal.)
Description of Problem:
The basic objective of AD measures is to offset 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 the 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 some 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 theirTN/RL/W/93
Page 2
findings on information from secondary sources known as “facts available.” The basic objective of
permitting use of facts available is, therefore, to balance the requirement to complete the appropriate
calculation of the margins of dumping and the requ irement to complete an AD proceeding within the
time period prescribed.
Notwithstanding the limited objectives in using “facts available”, there are many cases where
affirmative determinations are made on the basis of “facts available” in spite of the fact that
respondents have acted to the best of their ability and been cooperative.  Furthermore, in many cases
excessively high dumping margins are calculated based on “facts available” which are adverse to the
respondents’ interest, so-called “adverse facts available”. 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 available may be applied or thestandard for the selection of the facts available which may be used.  Given that the application of
“facts available” is permitted to facilitate investigations, there is a considerable scope for
improvement of the rules for the purpose of preventing abuse of “facts available”, as well as strictly
limiting the application of adverse facts available.  In view of this, we put forward the following six
proposals to address the issues associated with the use of “facts available”.
Note:  The conditions under which the authorities may request affiliated party information
and the scope thereof will be discussed in a separate paper.
Elements of a Solution:
1. Purpose of Using “Facts Available”
• Clarify that “facts available” can only be used to  substitute  for missing or rejected
information.
Proposal:
Amend the current text of Article 6.8 to explicitly state that “facts available” are to be  used
only for the purpose of substituting missing or rejected information. Examine how the concept of
“significant impediment”, which may be a cause of  misinterpretation due to its ambiguity, has been
applied, and thus whether it is appropriate to mainta in this concept in the Agreement, and instead to
add the concept of “refusal of verification” to clarify that facts available can be used also in a situation
where an interested party refuses verification of necessary information.
Explanation:
- This proposal intends to clarify the current provision of Article 6.8 that facts available should
be used only to substitute for information that the responding party did not submit orinformation that the responding party did submit but the authorities rejected.  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 information when the
information germane to the investigation is accurate and is submitted within a reasonable
period.  There is no rationale to use facts available where actual accurate data are available.
- We should examine whether it is necessary and appropriate to maintain the concept of
“significant impediment”, 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 impediment” is too broad a concept and has been used by
authorities as a catch all excuse to use facts available to penalize responding parties, evenwhere there are no real difficulties for the authorities to use the submitted information.TN/RL/W/93
Page 3
- We also propose to add the concept of “refusal of verification”.  This addition clarifies the
situation in which the authorities can use “facts available” by explicitly stating that facts
available can be used also in a situation where an  interested party refuses verification of
necessary information.  Inclusion of this standard balances the effects of the possible deletion
of the concept of “significant impediment”.
2. Situation in which “Facts Available” Can Be Applied
• Clarify the situations in which “facts available” can be applied by requiring the
authorities to make all reasonable efforts  to obtain the necessary information from
respondents.
Proposal:
(i) Amend 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 fu lfill the reasonable effort requirement, the
authority must notify the respondent in detail of information which was insufficient in theresponse to the authorities’ questionnaire.  The authority must also  permit the respondent to
submit the required information within a reasonable period of time. 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 :
- This proposal intends to codify implicit rules in the current AD Agreement, which the panel
in Argentina- Ceramic Tiles
1 clarified. 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 authorities have the initial  obligation of informing
respondents in clear and specific terms of information that they need, and may not resort to
facts available unless reasonable efforts have been made to further clarify the requested
information.
- We will also discuss factors to consider when determining whether a responding party
prepared and submitted the information within “a reasonable time.”
- This proposal is intended to make an addition to the current text of Annex II.1.
3. Method of Applying “Facts Available”
• Require the authorities to use any and all necessary information submitted by
respondents, provided that the information is  verifiable and appropriately submitted, as
recommended in the United States – Steel Plate .
Proposal:
Amend Annex II.3 to make it mandatory for authorities to use any and all submitted
information that is verifiable, germane to the invest igation and not proven to be inaccurate, as well as
complying with the other requirements set out in Annex II. 3.
                                                     
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/W/93
Page 4
Explanation:
- This proposal intends to clarify that authorities 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 Plate2 adjudicated.  In this case, the authorities rejected the submitted
data in  its entirety, although the submitted data 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 "shall be taken into account," lacks sufficient precision in this
respect.
- In addition, we also propose to add the concept of “germane to the investigation, not proven
to be inaccurate” to clarify that the authorit ies must use the submitted information which is
appropriately connected with the investigation and has not proven to be inaccurate.
• Require the authorities to choose  as “facts available” information from a secondary source that
appropriately represent the situation of the prevaili ng state of the industry or the relevant market.
Proposal:
Amend Annex II.7 to provide that authorities shall 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 the relevant market with respect to the missing or
rejected information.  The information shall be chosen, where practicable, based on an objectiveexamination of all information obtained by authorities during the course of an investigation/review in
light of the requirements set out in Annex II.7.
In this connection, amend the Article 6.6 so that the distinction between the authority’s
obligation with respect to an “Article 6.8 situation” and the other situation is eliminated. For this
purpose, delete the exception clause at the beginning of Article 6.6 and the phrase “supplied byinterested parties”.
Explanation:
- We propose that the above standard should replace the current standard as set forth in the first
sentence of Article 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 informationcan result in prohibitively high margins of dumping, so-called “adverse facts available”.
- 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 shall, 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 theauthorities the same obligation as provided for in Article 6.6, even 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."  
                                                     
2 See the panel report in United States - Anti-dumping and C ountervailing Measures on Steel Plate
from India,  WT/DS206/R (28 June 2002).TN/RL/W/93
Page 5
• Clarify the situation in which a party can be deemed to have been non-cooperative to the extent
that use of “facts available” less favorable to that party  is permitted .
Proposal:
Improve the last sentence of Annex II.7 by  clarifying 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 information could be verified, or if the party madereasonable efforts to submit the requested information in light of its ability to submit the information
and its ability to fulfill 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 cooperative.  The lack of clarity in the term
“cooperative” gives the authorities too much discretion in determining whether a respondent
is "cooperative" and thus whether or not to apply “adverse facts available”.  To clarify thecurrent 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 extent to which cooperative and non-cooperative
respondents may be treated differently, should be limited.
- As such, the “facts available” selection standard as proposed in the previous proposal is
applicable even to the selection of “facts available” that are less favorable.
• Ensure proper application of “facts available” by providing adequate and timely disclosure of the
basis of the decision to use “facts available.”
Proposal:
Amend Annex II.6 to provide that when the authorities 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 information has been totally or partially rejected and
specifically identify the information that the au thorities intend to substitute for the rejected
information.  Due regard must be given to confidential information relating to the disclosure in
accordance with Articles 6.4 and 6.5.
Explanation:
- We propose a  mechanism to guarantee the opportunity 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 interested parties ample opportunity to defend their
interests. Under the current provisions of A nnex II.6, however, the authorities may use, and in
fact have used in certain circumstances, one set of facts in the preliminary decision and
another set of facts, or “facts available” of some kind, in the final decision with little or no
warning or disclosure to interested parties. In terested parties are, and have been, deprived of
opportunity to comment on the change in information.
- 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.
- This proposal is intended to amend Annex II.6.
__________