RESTRICTEDWORLD TRADE
ORGANIZATIONG/ADP/IG/W/25
22 September 2000
(00-3810)
Committee on Anti-Dumping Practices
Informal Group on Anti-CircumventionOriginal:  English
TOPIC 2 – WHAT IS BEING DONE BY MEMBERS CONFRONTED
BY WHAT THEY CONSIDER TO BE CIRCUMVENTION?
Paper by New Zealand
The following communication, dated 20 September 2000, has been received from the
Permanent Mission of New Zealand.
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In our paper G/ADP/IG/ W/11, New Zealand listed three cases where circumvention had been
an issue, described the circumstances of each case and how it had been dealt with.  Two of the cases
have not necessitated any further actions.  Duties on sugar from Belgium, Denmark and the
Netherlands have now been revoked and duties on hog bristle paint brushes from China have beenreassessed as a result of a review.  From time to time the New Zealand Customs Service has had to
deal with cases of incorrect origin of paint brushes from China.  Any action taken has been under its
own legislation (the Customs and Excise Act 1996).
One case identified in our earlier paper remains problematical - Plasterboard from Thailand.
This paper repeats and updates the circumstances of this case.  It should be noted that the changes to
the product over time have been at the request of the New Zealand importers and not initiated by theplasterboard manufacturers in Thailand.
Plasterboard from Thailand
The New Zealand industry in this case manufactures standard plasterboard of 9.5 mm
nominal thickness and in multiple widths and lengths.  This board is mainly used in the domestic
housing market.  Other boards of varying thickness ar e also manufactured, with the next size up being
board which is 12.5 mm thick in multiple widths and lengths.  This board is used in the commercial
building market and is not considered to be co mpeting with board in the housing market.  Thai
manufacturers generally produce board with a thickness of 9 mm for the domestic housing market andother board of varying thickness for the commercial building market.  The distinguishing feature of
the board is the thickness, and standard plasterboard of any thickness within a designated range can
easily be substituted for 9.5 mm board in the New Zealand market.  It is not particularly difficult to
produce board of varying thickness as changes to the production process are minimal.
In June 1989 the New Zealand manufacturer of plasterboard lodged an application for the
initiation of an investigation against various sizes of standard and foil-backed plasterboard from
Thailand.  The investigation was initiated and the like goods defined as:G/ADP/IG/W/25
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Standard or foil—backed plasterboard having nominal dimensions of
9 mm. or 9.5 mm. thickness, by 1,200 mm width by 2,400 mm to
3,600 mm length.
After a period of time, importers began to avoid the anti-dumping duties on some plasterboard
by varying the lengths of board so that they were  outside the description of the final notice, i.e.
lengths shorter than 2,400 mm and longer than 3,600 mm.  In particular, lengths of board measuring
4,800 mm in length were being imported and cut in half to supply the market with the most popular
length board of 2,400 mm.
The New Zealand industry lodged a new applicati on for an investigation and this was initiated
and conducted into the following goods:
Plasterboard of nominal dimensions of 9 mm or 9.5 mm thickness and lengths of less
than 2,400 mm and greater than 3,600 mm.
An anti-dumping duty was imposed on these goods at the same level as that applying to the
first investigation.
Imports then started appearing in the market place for goods with a thickness of 10 mm.  This
particular board competed directly against the board of 9 mm or 9.5 mm thickness and the
New Zealand industry lodged a further application, which was initiated in October 1996.  The
definition of the goods in this case was:
Standard plasterboard with dimensions falling between a thickness of 8.75 mm to
10.25 mm of any length or width (not including plasterboard subject to anti-dumping
duty under other notices).
It was considered that this description would finally capture all plasterboard that competed
directly with the goods made by the New Zealand industry, but in October 1999 board with a
thickness of 10.50 mm appeared in the market.  The New Zealand manufacturer has again been
obliged to lodge a new case, showing that the board it manufactures is "like" the new thickness of
board being imported and the imported board is dumped and is causing it material injury or threat ofmaterial injury.  This case was initiated in April 2000.  The description of the goods under
investigation is:
Standard plasterboard with dimensions of a nominal thickness from, but not including
6 mm, and up to, but not including 12 mm, of any width or length (other than those
dimensions already subject to anti-dumping duty).
The case is currently in its final stages.  All interested parties have been informed of the
essential facts under consideration which will form the basis for the decision whether to apply
definitive measures and have been asked for their comments.  It should be noted that no party has
argued that 10.5 mm board is not "like" 9.5 mm board
This is an example of circumvention of the original and subsequent anti-dumping duty by
way of importing goods slightly different from those stipulated in the final notices. It illustrates some
of the difficulties that can arise in trying to define like goods.  Reference to other countries papers
show that some would deal with such circumstances under circumvention provisions, but in the
absence of such laws and rules others deal with the such changes by initiating a new case.
The situation above is not unlike that described in Part 1 of the United States paper
G/ADP/IG/W/20, particularly Example 2 (Silicon Metal) where it was determined that circumventionG/ADP/IG/W/25
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existed.  The US in this case determined that the product was within the scope of the original order
even though the description appeared to cover a certain product.  New Zealand practice, on the other
hand, is to conduct another investigation, based on a new application by the New Zealand industry.
Questions Posed by Japan ( G/ADP/IG/W/23)
I The practical importance of anti-circumvention measures against Members of the WTO
New Zealand has three cases where it has had to take action to ensure that imports of various
products were being correctly imported.  These cases were identified in G/ADP/IG/W/11 as being:
• Sugar from Belgium, Denmark and the Netherlands which involved "country hopping";
• Hog Bristle Paint Brushes from China which in volved incorrect origin certificates; and
• Plasterboard from Thailand which involved the scope of the final determinations.
As New Zealand does not have circumvention provisions in its legislation, no special procedures were
adopted in any of these cases.
II Dealing with circumvention within the framework of normal anti-dumping procedures
or customs regulations
No special procedures were adopted in any of these cases.  New cases were initiated in the
plasterboard and sugar cases and the NZ Customs Service dealt with the incorrect origin certificates in
the case of paint brushes under the Customs and Excise Act 1996.
The plasterboard case is described fully in this paper.  It involves the description of like goods
and variations of that description to capture ne w products being imported.  In hindsight, if an all
encompassing description of the plasterboard competing in the New Zealand market had been
established at the beginning of the first case, other cases would not have been needed to capture the
different boards coming into the market, but still considered to be like.
The sugar case involved switching to suppliers in new countries and did not involve the
circumstances outlined in Article 2.5.  The only option under New Zealand legislation was to initiate a
new case following an application from the New Zealand industry.
As noted above, the incorrect origin on imports of paint brushes was dealt with by NZ
Customs under the provisions of the Customs and Excise Act.
New Zealand has used the provisions of Article 2.5 in one case but has no experience of the
circumstances outlined in Question 10 of Japan's paper.
III Criteria used for distinguishing between legitimate commercial activities and
circumvention
In the three cases that New Zealand has discussed in its papers, it was considered that only the
paint brush case was not a legitimate commercial activity, as declaring the incorrect origin on
Custom's documents can be considered to be fraudulent.
Shifting supplier to a new country for a product is considered a legitimate business activity
and can happen despite the imposition of anti-dumping duties.  In the sugar case the importers did
shift suppliers because of the duties.  The New Zealand industry was required to comply with the
provisions of Article 5 of the Agreement to enable a new case could be initiated.  Although injuryG/ADP/IG/W/25
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evidence was based on threat and had some commonality to the previous case, it was important to
establish that the sugar being imported from the new countries was in fact like goods and was being
dumped.
Plasterboard involves the description of like goods, which some countries would consider a
"scoping issue".   New Zealand practice is to treat each case as a new product unless the description ofthe goods in the original notice clearly capture s the "new" product being imported.  This allows
interested parties, particularly exporters and importers to argue their cases on any relevant issue.
IV Criteria used for verifying the probability of continuous dumping and injury
This circumstance is not applicable to New Zealand practice as a complete investigation is
carried out in such cases.
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