WORLD TRADE
ORGANIZATIONG/ADP/AHG/W/154
20 October 2003
(03-5526)
Committee on Anti-Dumping Practices
Working Group on ImplementationOriginal:  English
ARTICLE 6.7 – CONDUCT OF VERIFICATION
Paper by the Canada
The following communication, dated 17 October 2003, has been received from the Permanent
Mission of the Canada.
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Further to the decision of the Committee to examine additional topics for discussion as noted
in document G/ADP/W/433, Canada submits this paper to explain how Canadian anti-dumping
authorities conduct verification pursuant to Article 6.7 of the Anti-dumping Agreement (ADA).  This
provision states:
In order to verify information provided or to obtain further details, the authorities
may carry out investigations in the territory of other Members as required, provided
they obtain the agreement of the firms concerned and notify the representatives of the
government of the Member in question, and unless that Member objects to the
investigation.  The procedures described in Annex I shall apply to investigations
carried out in the territory of other Members.  Subject to the requirement to protect
confidential information, the authorities shall make the results of any such
investigations available, or shall provide disclosure thereof pursuant to paragraph 9,to the firms to which they pertain and may make such results available to the
applicants.
Canadian Practice
The Canada Customs and Revenue Agency (CCRA) is responsible for the determination of
dumping in an anti-dumping investigation.  The CCRA is primarily guided by ADA Article 6.7 andAnnex I (Procedures for On-the-Spot Investigations Pursuant to Paragraph 7 of Article 6) respecting
the verification of information in anti-dumping investigations.  These provisions are reflected in
CCRA administrative policies and procedures.
The CCRA normally conducts verification meetings in respect of original investigations and
in subsequent administrative reviews.  The verification can occur before or after the preliminary
determination of dumping.  Verification meetings only occur if a substantially complete submissionhas been received from the parties in response to the dumping questionnaires.  Verification meetings
are normally two to four days in duration.
At the time of the initiation of an anti-dumping investigation, exporters and producers and the
government of the country of export are advised that verification meetings may be conducted and an
explanation of the verification process is provided.  The parties are advised that the purpose of the
verification meeting is to verify information alread y provided to the CCRA in their submissions andG/ADP/AHG/W/154
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that the meetings are not intended to be a subsequent opportunity to provide new or additional
information.
In order to ensure that the verification meetings will be productive, the parties are also
advised at the initiation of an investigation that the company officials who prepare any part of the
submission should be available at the meeting to respond to questions.  As well, company officials
should be prepared to promptly retrieve and copy any source documentation requested by the
investigating officers.  The parties are advised that during a verification meeting, it may be necessary
to require information on products not covered by the investigation in order to validate costingallocations made in respect of the goods under investigation.  The parties are also advised that the
investigating officials may wish to visit any loca tion where there is information relevant to the
verification such as head office, sales offices, factory locations and warehouses.
If verification meetings are to be conducted, the exporters and producers and the government
of the country of export will be provided with a notice of the meeting.  The notice will contain the
names of the officials conducting the verification, the time and location and duration of the meetings.A verification meeting will not be scheduled unless the exporter or producer has expressly agreed to
the meeting and the government of the country of export has not objected.
The investigating officials will prepare a verification plan prior to the meeting in order to
identify the information to be verified and the quest ions to be posed to company officials.  Generally,
the parties will be provided with details concerning  the information to be verified during the meetings
and any other issues which the investigators will want to discuss with company officials.
All documentation provided to the CCRA during a verification meeting is subject to rules
relating to the disclosure of information.  As such, parties must submit a non-confidential version of
any confidential material provided to the CCRA.
Verification reports are generally prepared for each exporter or producer and these reports are
placed on the administrative record.   Upon request, a disclosure meeting will be conducted to discuss
the results of verification with the parties to which the verification directly applies.
In some cases, the CCRA will conduct “desk audits” rather than on-the-spot verification
meetings.  These types of audits are only used after a careful analysis of the submission and an
assessment of its apparent accuracy and reliability.  A number of specific criteria must be satisfied
before the decision is taken to undertake a desk audit rather than conduct an on-the-spot verification.
Additional information may be requested of the parties in order to verify certain aspects of the
submission.
A brief description of how the CCRA initiates and conducts a desk audit is attached at
Appendix I.G/ADP/AHG/W/154
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Appendix I
Brief Description of Desk Audits
A desk audit is a detailed review and analysis of an exporter's, importer's or producer's
response to a Request for Information (RFI), for any phase of an investigation or re-investigation.  As
the term implies, a desk audit is performed through communications between officials of the CCRA in
Ottawa and a company’s personnel, without the need to travel.  It may involve requesting
supplementary data, a relatively easy process given our growing communications technology, and a
comparative analysis with other industry’s or companies’ data.  The purpose of the desk audit is
similar to that of the verification visit, i.e., to asse ss the reliability and accuracy of the responses to the
RFI.
Significant benefits can be found from conducti ng desk audits, particularly where the CCRA
has had some experience with the exporter and is conducting reviews or re-investigations or is
monitoring voluntary compliance.  However, the use of desk audits must not be expanded to the point
where the CCRA would be abrogating its responsi bilities and obligations to ensure that the
information it is using is correct and risking charges of not treating parties fairly and equitably.
It must be stressed that desk audits are meant to complement regular on-site verification work
not replace it. Desk audits will be conducted only on a limited and selective basis after a careful
analysis of each exporter’s situation.
It should be noted that a desk audit does not mean acceptance of the submission or position of
an exporter, but will involve the critical and detailed review and analysis of the material submitted
which could result in acceptance or rejection of a company's submission or position.
Consideration may be given to the conduct of a desk audit rather than an on-site verification
in light of the following factors, as appropriate to the particular circumstances of a case:
• The level of the normal values derived from a preliminary analysis of the exporter’s submission,
in comparison with the verified findings for other exporters.
• The results of verification visit(s) to the exporter conducted in the recent past (e.g., previous 2
years).
• The track record of the exporter with respect to provision of data and voluntary compliance.
• The comprehensiveness and organization of the exporter’s submission.
• The responsiveness of the exporter  to requests for supplementary or corroborating data.
• The concordance between the data in the exporter’s submission and previous data supplied by the
exporter.
• The presence of major contentious issues.
• The size of the case in terms of numbers of exporters or importers.
• The volume, value and potential for growth of the imports involved.G/ADP/AHG/W/154
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• The nature of the product and the knowledge of the CCRA with respect to the manufacturing
processes and raw material input costs,  as well as the ability to verify data independently.
• The availability, reliability and usefulness of audited financial statements.
If it is decided to proceed with the desk audit, a detailed and comprehensive analysis of the
company's submission will be completed.  Supplementary RFIs may be sent to the exporter; responses
to these RFIs could lead to a decision to continue or not to continue with the desk audit.
A desk audit report will be prepared, as a substitute for the verification report done as a result
of verification visits.  The report will contain a complete set of organized working papers which will
provide details of the actions taken, discussions, contentious issues, the decisions and calculations
made, the audit trail/linkage between the submission and the final decisions.   In case of significant
discrepancies between the results of the desk audit and the results for other exporters, including those
who have been subject to a verification visit, the CCRA reserves the right to conduct a verificationvisit.
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