RESTRICTEDWORLD TRADE
ORGANIZATIONG/ADP/Q1/POL/5
G/SCM/Q1/POL/5
20 October 1998
(98-4058)
Committee on Anti-Dumping Practices
Committee on Subsidies and Countervailing MeasuresOriginal:  English
NOTIFICATION OF LAWS AND REGULATIONS UNDER
ARTICLES 18.5 AND 32.6 OF THE AGREEMENTS
Questions Posed by the UNITED STATES
Regarding the Notification of POLAND1
The following communication, dated 16 October 1998, has been received from the Permanent
Mission of the United States.
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I.      DETERMINATION OF DUMPING
Selection of Normal Value (“NV”).  Article 4.1 of  the Polish anti-dumping duty ( “A-D”) Law states
that the NV is determined based on “prices actually paid or due in an ordinary course of trade from
non-related purchasers in the exporting country”.  Assuming that a foreign exporter does not produce
or sell “like goods” within the “ordinary course of trade,” Article 4.3 of the Polish A-D Law provides
for calculating the NV based upon prices “by other sellers or producers”.  Article 2.2 of the WTO
Agreement specifies that where sales in the home market are insufficient for comparison purposes, the
dumping margin “shall be determined” by comparing the prices of the like product exported to an“appropriate third country” or constructed value (“CV”).
1. In light of the WTO Agreement’s requirement to use prices to third countries or CV
whenever home market sales are insufficient for comparison purposes, how can Poland
reconcile Article 4.3 of the Polish A-D Law, which permits the use of prices by “other”sellers or producers in the exporting country’s market, with Article 2.2 of the WTO
Agreement?
Viability of Domestic Market.  Article 4.5 of the Polish A-D Law specifies that sales of similar goods
in the exporting country’s market can be used to determine the NV, where they constitute “at least
5 per cent” of the volume of sales in the Polish market.  Article 4.5 continues that “smaller quantities
may be used” if the applied prices are considered to be “representative for the given market.”
Article 2.2. of the WTO Agreement states, however, that quantities smaller than 5 per cent may be
used where the evidence demonstrates that they are “nonetheless of sufficient magnitude to provide
for proper comparison”.
2. Does the term “representative” under Article 4.5 of the Polish A-D Law mirror the
WTO Agreement’s emphasis on “sufficient magnitude” of sales below 5 per cent of
the volume of domestic sales?
                                                     
1 G/ADP/N/1/POL/2-G/SCM/N/1/POL/2G/ADP/Q1/POL/5
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Elements of Constructed Value.  Under Article 5.1(2) of the Polish A-D law, the CV consist of the
following elements: (a) costs of production; (b) costs “directly connected” with the sales;
(c) “general” costs; (d) “all other” costs; and (e) the “sum of the profit.”  Article 2.2 of the WTO
Agreement requires that the CV consist of (a) the cost of production, (b) “a reasonable amount foradministrative, selling and any other costs”, and (c) profits.
3. Because the Polish A-D Law does not define its various cost components, is it correct
to assume that the elements comprising the “normal constructed value” under
Article 5.1(2) of the Polish A-D Law mirror the elements enumerated in Article 2.2 of
the WTO Agreement?
Calculation of Costs.  Although Article 2.2.1.1 of the WTO Agreement contains a clear mandate that
costs shall be calculated on the basis of records kept by the exporter or producer, provided that such
records are “in accordance with the generally accepted accounting principles” (GAAP), Article 5.5 of
the Polish A-D Law contains no such requirement.  It merely states that costs shall be calculated “on
the basis of records of the unit kept according to rules resulting from the documentation ... anddescribing accountancy rules adopted by it, on the condition that entries in the books properly
document costs ...”.  Moreover, Article 5.5 of the Polish A-D Law explains that allocation of costs
shall be accepted under the condition that such allocations have been “effectively utilised”.
4.Does the phrase “accountancy rules adopted by [the unit]” under Article 5.5 of the Polish A-
D Law refer to the GAAP, thereby satisfying the direction of Article 2.2.1.1 of the WTO Agreement?
Please explain what is meant by allocations that have been “effectively utilised”.
Start-Up Operations.  Article 5.9 of the Polish A-D Law requires that the start-up phase “cannot
exceed an appropriate initial part of the cost recovery period”.
5. How will Poland determine what constitutes the “initial part of the recovery period”
beyond which the start-up phase may not continue?  How is this standard consistent
with Article 2.2.1.1 of the WTO Agreement, which merely states that start-up
operations “shall reflect the costs at the end of the start-up period” or “the most recent
costs which can reasonably be taken into account”?
Calculation of Profit.  When the amount of profit and/or general, sales and other expenses cannot be
determined on the basis of the producer’s actual data, one of the alternatives under Article 5.11(2) of
the Polish A-D Law specifies that these expenses may also be based upon “actual amounts” in
connection with the “same category” of “similar goods” that are sold in the ordinary course of trade.
This alternative is inconsistent with Article 2.2.2(i) of the WTO Agreement, which does not limit the
use of the producer’s actual profit and expenses to products sold only in the ordinary course of trade.
6. What is the rationale behind the requirement under Article 5.11(2) of the Polish A-D
Law to limit the use of profits and expenses to those realized and incurred only in the
ordinary course of trade?  How will Poland determine whether production and sales
of the general category of products are in the ordinary course of trade?
Non-Market Economies.  Article 6.1 of the Polish  A-D Law provides that, for non-market economy
countries, Poland will base the NV on: (a) the price applied in “a third country of a market economy”;
(b) “export price” from an investigated non-market economy to other countries (including Poland); or(c) the CV predicated upon “conditions of a market economy”.  If (a) through (c) is not possible, the
NV will be based on “another justified method,” including the price paid for similar products in the
Polish market.  With respect to the process of  “selection” of the third country, Article 6.2 of the
Polish A-D Law provides, very generally, that Poland will evaluate the “production conditions” of aG/ADP/Q1/POL/5
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similar product in Poland, taking into consideration all available information pertaining to the period
of investigation, and compare them with the conditions encountered in a non-market economy
country.  After informing all concerned parties about the “selection” of a third country, Article 6.3
provides for a 10-day period for comment.
7. What are the criteria considered in determining whether a country is a non-market
economy?
8. What criteria are examined in selecting an appropriate third country market
economy?
9. Once Poland determines that non-market economy merchandise is being dumped in
Poland, how are anti-dumping duty rates assigned?  Is only one rate assigned for all
merchandise from the non-market economy country?  Is each exporter assigned a
separate rate?  Are third country trading companies assigned separate rates?  If there
are so many respondents that Poland is forced only to examine the response of asample group of respondents, how are anti-dumping duty rates assigned?
Adjustments.  Article 9.2 specifies that EP and NV are calculated “at the same level of the trade,
normally at ex factory level and ... with due allowance to differences affecting the price
comparability”.
10. How does Poland intend to interpret and implement the “ex-factory level”
requirement?
Price Averaging.  According to Article 11.2 of the Polish A-D Law, the weighted-average NV “can be
compared with prices of all export transactions ... provided that the level of export prices considerably
differs ... and the application of the aforementioned methods does not allow to reflect fully the scope
of dumping practices”.  Article 2.4.2 of the WTO Agreement states that the above
average-to-transaction method may be used “if the authorities find a pattern of export prices which
differ significantly ... and if an explanation is provided why such differences cannot be taken into
account appropriately” by the use of the average-to-average or transaction-to-transaction comparisons.
11. Please explain if, and if so how, Articl e 11.2 of the Polish A-D Law limits the use of
the average-to-transaction comparison only to situations envisioned by Article 2.4.2
of the WTO Agreement?
II. DETERMINATION OF INJURY
Material injury.   In determining material injury, Article 13 of the Polish A-D Law states that Poland
will consider whether dumped imports are much lower priced than domestic goods and  “whether the
dumped imports are undercutting prices of goods made by domestic producers in any other way....”.
12. How is this consistent with A-D Article 3.2, which requires investigating authorities
to consider whether price undercutting has been significant?
13. What is the meaning of the term “real injury” in Article 13 of the Polish A-D Law?
How does this comport with the definition of “injury” in A-D Article 2 (2), whichrefers to material injury, threat of material injury, or material retardation?G/ADP/Q1/POL/5
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Article15 of the Polish A-D Law states that one of the factors to consider in  examining the impact of
dumped imports is “a duration of the process of overcoming difficulties caused by the dumped
imports....” .
14. What is meant by this phrase?
Article18 (3) of the Polish A-D Law states that Poland will “especially” consider “an increase of the
dumped imports to the Polish customs territory” as a factor in determining whether there is a threat of
a material injury to the domestic industry.
15. How is this consistent with A-D Article 3.7(i), which states that, in making a
determination of threat of material injury, investigating authorities must consider
whether there is “a significant  rate of increase of dumped imports into the domestic
market... ?”
III. ANTI-DUMPING PROCEDURES; DURATION AND REVIEW OF  ANTI-DUMPING
DUTIES AND PRICE UNDERTAKINGS
Initiation Without Written Request.  Under Article 20.1(2) of the Polish A-D Law, in special
circumstances, anti-dumping investigations shall be initiated without a written request from the
domestic industry, where there is mere “evidence” of dumping, injury and their causal relation.Article 5.6 of the WTO Agreement indicates more precisely, however, that this form of initiation shall
be done “only” if there is “sufficient evidence” of dumping, in addition to injury and causal relation.
16. Under Article 20.1(2) of the Polish A-D Law, what is the threshold of evidence
needed to initiate an anti-dumping investigation in an  ex officio  manner?
Application Requirements.  The Polish A-D Law is silent on the what information needs to be
contained in an application.  Article 20.4 of the Po lish A-D Law indicates only that the “Minister of
Economy shall determine the application form to initiate anti-dumping procedures in a regulation".
17. Has Poland already promulgated a regulation determining the “form” of the
application for initiation of anti-dumping procedures, and specifying itsrequirements?  How will Poland ensure that applications comply with the
requirements of Article 5.2 of the A-D Agreement?
18. If the above regulation is not yet in effect, are domestic parties in Poland precluded
from filing a written request to initiate an anti-dumping investigation until theMinister of Economy determines the form of the application and its requirements, as
envisioned by Article 20.4 of the Polish A-D Law?
De Minimis  Margins.  Article 5.8 of the WTO Agreement provides for immediate termination of
investigations if the authorities determine that the margin of dumping is de minimis , i.e., less than
2 per cent, or if the volume of imports is found to be negligible, i.e., less than 3 per cent of imports of
the like product.  Article 21.1(1) of the Polish A-D Law defines only what constitutes an insignificant
volume of goods, which is “lower than 1 per cent of the domestic production of the goods, unless the
total importation from such countries constituted three or more per cent of the said consumption.”
19. Why is volume tied to consumption in the Polish market rather than import  volume,
as required by Article 5.8 of the WTO Agreement?  On what basis has Poland
abandoned the general rule of Article 5.8 of the WTO Agreement in favour of a
market share approach?G/ADP/Q1/POL/5
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20. When market penetration is high, will not the Polish standard result in fewer
situations being found to be “negligible” than under the standard delineated in
Article 5.8 of the Agreement?
21. Why does Article 21.1(1) of the Polish A-D Law fail to provide for the immediate
termination of investigation if the margin is de minimis , i.e., less than 2 per cent, as
required by to Article 5.8 of the WTO Agreement?
22. Article 34 (1) of the Polish Law states that the Minister of Economy shall discontinue
anti-dumping procedures against a country which has “small” imports into Polandaccording to Article 21.1(1).  Article 21 uses the word “insignificant,” not small.  Do
small and insignificant have the same meaning?
Article 21.3 of the Polish Law says that there is a “presumption” regarding dumped imports.
23. What is this presumption?
Facts Available.  Articles 25.1 and 25.2 of the Poli sh A-D Law require that the parties supply “all
information and opinions” deemed “necessary” for the determinations.  Where a party refuses to
supply such information or “grossly makes anti-dumping procedures more difficult in any other way”,the decisions can be made based upon “other available information”.  Article 25.3 warns that, if the
presented information is misleading or false, “other available data shall be used in the procedures”.
Notwithstanding paragraph 3, paragraph 5 states that questionable information shall nonetheless be
taken into account if it (1) does not result in “unnecessary difficulties”, (2) is supplied on time, (3) can
be verified, and (4) the party preparing it acts to the best of its ability.
24. Article 24 of the Polish A-D Law does not specifically require that Poland notify
interested parties as soon as possible after the start of an investigation regarding the
information that will be required of them  (and the format in which the information
should be submitted), as well as the fact that if information is not supplied within a
reasonable time, the facts available will be used in making a determination, as
required by Annex II, section 1 of the WTO Agreement.  Does Poland intend tonotify parties pursuant to this requirement?
25. Article 24 of the Polish A-D Law is not clear as to whether partial cooperation by an
interested party will lead to partial or total use of facts available.  How does Poland
intend to respond if it finds that a party has only partially cooperated?
Verification of Submitted Information.  The Polish A-D Law lacks procedural and substantive detail
with respect to verification of submitted information.  Article 26.1 only generally states that Poland
“may carry out a necessary control of the documentation” when the parties agree and the government
of the foreign country has been “duly informed” about the upcoming verification.
 26. Please explain the procedures Poland intends to follow with respect to verification of
the exporter’s or producer’s submitted information.
Price Undertakings.  Under Article 31 of the Polish A-D Law, Poland can “terminate” investigations
pursuant to price undertakings.  Article 8.1 of the WTO Agreement allows investigations to be
“suspended or terminated”.G/ADP/Q1/POL/5
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27. Does Article 31 of the Polish A-D Law m ean “suspended” when it says “terminated”?
Please explain whether or not the Polish authorities will be able to suspend
investigations upon the acceptance of a price undertaking.
Review Process in General.   Article 12 of the WTO Agreement sets forth necessary details required
to properly inform the public about anti-dumping investigations, including a requirement that
determinations be sufficiently explained.  Article 23.2 of the Polish A-D Law, pertaining to initial
anti-dumping investigations, merely specifies that, upon completion, the “justification of the decision
... shall include evidence collected during the procedures according to requirements of the WTO
Agreement”.  However, the Polish A-D Law addres sing other types of proceedings (i.e., regular
reviews or sunset reviews), does not contain a similar provision.  Article 49.3 of the Polish A-D Lawonly generally requires that “final decisions shall be formulated with the consideration of all
important and appropriately confirmed evidence”.
28. Does Poland intend to apply the requirements set forth by Article 12 of the WTO
Agreement to all types of anti-dumping proceedings to ensure that the public isproperly informed about the determinations and the reasoning behind them?
Termination of Anti-dumping Procedures.  Articl e 49.4 of the Polish A-D Law specifies that imposed
anti-dumping duties shall apply until the review procedures are “terminated”.  Under Article 55,
however, Poland “may resume anti-dumping procedures” after consultations with relevant domesticparties and government officials when the domestic parties supply “sufficient evidence proving that
the applied anti-dumping procedures have not resulted in any movements in domestic prices” or these
prices were “insufficient to repair the injury”.
29. In what context may Poland “resume” anti-dumping procedures pursuant to Article
55 of the Polish A-D Law?  Does Poland intend to implement Article 55 in situations
where the anti-dumping “procedures” were te rminated in accordance with Article 11
of the WTO Agreement (e.g., regular termination or termination under the “sunset”
provision)?  Please explain the effect of “termination” under Article 49.4 of thePolish A-D Law and how it relates to the “resumption” of anti-dumping procedures
under Article 55.
30. How does Article 55 of the Polish A-D Law relate to the “sunset” procedures
addressed by Article 48 of the Polish A-D Law?
Confidential Information.  Article 60 of the Polish Law states that there could be a “necessity” to
make information and evidence obtained during A-D procedures public.  Under those circumstances,
Article 59, which provides that confidential inform ation would be treated as such, would not apply.
31. Under what circumstances, would confiden tial information be made public under this
“necessity” rule?  How would such disclosure be consistent with Article 6.5 of the A-
D Agreement?
Judicial Review. The Polish A-D Law is silent on judicial review.  The WTO Agreement, under
Article 13, specifically states that each Member shall maintain judicial tribunals to promptly review
administrative actions within the meaning of Article 11 of the WTO Agreement.
32. Does Poland maintain judicial, arbitrary or administrative tribunals for the purpose of
review of administrative actions in connection with anti-dumping procedures?G/ADP/Q1/POL/5
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General Question.  Poland notified the Law of 11 December 1997 on the against importing good into
the Polish customs territory at dumping prices to both the Committee on Anti-dumping Practices and
the Committee on Subsidies and Countervailing Measures.
33. Could Poland identify which, if any, of the provisions of Law 11 relate to
countervailing duty proceedings?
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