WORLD TRADE
ORGANIZATIONG/ADP/N/1/LVA/2/Suppl.2
22 July 2002
(02-4030)
Committee on Anti-Dumping Practices Original:  English
NOTIFICATION OF LAWS AND REGULATIONS
UNDER ARTICLE 18.5 OF THE AGREEMENT
LATVIA
Supplement
The following communication, dated 17 July 2002, has been received from the Permanent
Mission of Latvia.
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Disclaimer:  The English language text below is provided by the Translation and Terminology Centre
for information only; it confers no rights and imposes no obligations separate from those conferred orimposed by the legislation formally adopted and published.  Only the latter is authentic.  The original
Latvian text uses masculine pronouns in the singul ar.  The Translation and Terminology Centre uses
the principle of gender-neutral language in its English translations.  In addition, gender-specific
Latvian nouns have been translated as gender-neutral terms, e.g. chairperson.
Republic of Latvia
Cabinet
Regulation No. 234
Adopted 11 July 2000
Procedures for the Application of Certain Provisions of the
Anti-Dumping Law
Issued in accordance with Section 4, paragraph three;
Section 26, Paragraph one;
Section 35, Paragraphs three and four and
Section 36, Paragraph two of the Anti-Dumping Law
I. General Provisions
1. These Regulations prescribe the procedures as to how determination of the normal value and
the export price of goods and their comparison for determination of dumping margins, determination
of injury, acquisition of information and investigation procedures in foreign states, proposition of
price adjustments and adoption of price adjustments suggested by exporters, as well as registration of
the investigated goods and annulment of guarantees shall take place.G/ADP/N/1/LVA/2/Suppl.2
Page 2
II. Determination of Normal Value
2. The State Protection of Domestic Market Bureau (hereinafter – the Bureau) shall determine
the normal value of the investigated goods on the basis of the price that independent purchasers have
paid or will be paying in the exporting state.
3. If the exporter does not produce or sell like goods in the domestic market of the exporting
state, the normal value of the investigated goods may be determined on the basis of the prices of other
sellers or producers.
4. Prices as between persons who are mutually associated or have agreed upon a compensation
mechanism shall be considered as being outside the ordinary course of trade and not usable indetermining normal value, unless it is determined th at such relations do not affect the price of the
goods.
5. If like goods, in the ordinary course of trade, are not sold in the domestic market of the
exporting state, or it is not possible to perform appropriate comparison in the domestic market of theexporting state because of a specific situation or a small volume of sales in the market, the Bureau
shall determine the normal value of the investigated goods on the basis of:
5.1. the comparable price of like goods at which they are exported to a relevant third state, on
the condition that this price is within the ordinary course of trade; and
5.2. production costs in the state of origin of the goods, to which are added the relevant total
of the costs of the undertaking's administrative, sales and other economic activity, and profit.
6. The volume of sales of like goods in the domestic market of the exporting state shall be
adequate for the determination of the normal value, if it is not less than five per cent of the volume of
sales of the investigated goods in Latvia. It is possible, however, to also utilise a smaller volume of
sales and to apply a smaller percentage, if it can be assumed, on the basis of evidence, that such sales
present an amount sufficiently characteristic for comparison to be performed.
7. Sales of like goods in the domestic market of the exporting state, or sales in a third country, at
prices which are less than the production costs of one unit (permanent or variable) to which are addedthe costs of the administrative, sales and other economic activity of the undertaking, shall be
presumed to be outside the ordinary course of trade because of the price, and shall not be taken into
account in determination of the normal value, provid ed that the Bureau determines that such sales
have been performed:
7.1. during a prolonged period of time (not less than six months);
7.2. in large amounts; and7.3. at prices that do not provide for full recovery of all production costs during the relevant
time period. If prices which at the time of sale are less than the production cost, exceed weighted
average costs of one unit during the period of investigation, such prices shall be considered to be such
as provide for the recovery of costs during the relevant time period.
8. Sales at a price lower than the production costs shall be considered as performed in large
quantities if:
8.1. the weighted average selling price of the relevant transactions for the determination of
normal value is less than the weighted average cost price of one unit;G/ADP/N/1/LVA/2/Suppl.2
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8.2. the volume of sales at a price that is lower than the production costs is at least 20 per cent
of the volume of sales that is utilised for the determination of the normal value.
9. For the purposes prescribed in the Anti-Dumping Law, the Bureau shall calculate the
production costs of like goods on the basis of the docume ntation at the disposal of the exporter or the
producer under investigation, on the condition that such documentation conforms to accounting
principles generally recognised in the exporting state and appropriately reflects the costs related to the
production and sale of the relevant goods.
10. All evidence accessible to the Bureau regarding adequate distribution of costs shall be
considered, including such as were provided in the course of the investigation by the exporter or theproducer, on condition that the exporter or the producer has, in accordance with accounting principles
generally recognised in the exporting state, utilised such distribution of costs, including a relevant
amortisation period and capital investments, as well as other expenditures of production development.
If methods that are more appropriate are not available, preference shall be given to distribution of
costs on the basis of turnover.  If it is not reflected in the distribution of costs in accordance with thisParagraph, the Bureau shall respectively correct the costs with respect to one of the following factors:
10.1. one-time cost items related to production development;10.2. utilisation of new material and technical facilities in production, which affects the costs
and requires additional investments, or low levels of capacity utilisation, if the production was
initiated during the period of investigation or a part thereof.  In the case referred to, the average costs
of the initiation of production shall be the costs at the end of the production initiation period.  If this is
longer than the period of investigation, the average costs shall be the costs at the end of the
investigation period.  The average costs referred to shall be distributed in accordance with therequirements specified in this Paragraph, and they  shall be included in the determination of the
weighted average value in accordance with Paragraphs 7 and 8 of these Regulations.
11. The total of the undertaking's administrative, sales and other economic activity costs and
profit shall be based on the actual data regarding the production and sale of like goods in the ordinary
course of trade carried on by the exporter or producer to be investigated.  If such amounts cannot be
specified in the way referred to, the Bureau shall determine them on the basis of:
11.1. actual amounts that the relevant exporter or producer has spent for the production and
sale of goods of the same category in the domestic market of the exporting state;
11.2. the weighted average actual amounts that have been determined in regard to other
exporters or producers subject to investigation, who are engaged in the production and sale of like
goods in the domestic market of the state of origin; and
11.3. any other appropriate method upon condition that the amount of profit determined
thereby does not exceed the profit of other exporters or producers that has been obtained by sellinggoods of the same category in the domestic market of the state of origin.
12. If there is no market economy in the exporting state, the Bureau shall determine the normal
value of the investigated goods on the basis of:
12.1. the price or compound value of like goods in accordance with Section 166 of the
Customs Law, if such goods are intended for consumption in a relevant state in which there is a
market economy; andG/ADP/N/1/LVA/2/Suppl.2
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12.2. the comparable price of like goods in the ordinary course of trade if they are intended
for export from a third country in which there is a market economy to other states, including Latvia.
13. If it is not possible to utilise the methods prescribed in Paragraph 12 of these Regulations, the
Bureau shall determine the normal value of the investigated goods on the basis of the actual price oflike domestic goods, and make the relevant corrections, if necessary, in order to include a reasonable
share of profit in each particular case.
14. The Bureau shall select an appropriate third country in which there is a market economy, for
the purposes prescribed in Paragraph 12 of these Regulations, on the basis of information available
during the investigation, as well as, taking into account the time restrictions regarding the conducting
of the investigation.  If possible, preference shall be given to a third country in which there is a marketeconomy and which is already subject to a concrete dumping matter investigation.  The Bureau shall
notify the interested parties of its decision, and th ey may, within 10 days from the receipt of the
notification, provide their comments.
III. Determination of Export Price
15. If there is no export price, or it is not plausible, because the exporter and importer or a third
person are mutually associated or have agreed upon a compensation mechanism, the Bureau shall
determine the export price on the basis of:
15.1. the price at which the imported goods are resold for the first time to an independent
purchaser.  An independent purchaser is a person who is not considered a mutually associated person
within the meaning of Section 164 of the Customs Law;  and
15.2. an other method chosen by the Bureau, if the goods are not sold to an independent
purchaser or are not resold in such condition as they were imported in.
16. In cases referred to in Paragraph 15 of these Regulations, all costs, including fees and taxes
that are to be paid during the time period between the import and resale, as well as the profit obtained,
shall be corrected in order to determine a plausible export price on the border of Latvia.
17. If another person who is associated with the importer or the exporter, or has agreed with the
exporter or importer regarding a compensation mech anism covers the costs of the importer, the
following cost items shall be corrected:
17.1. transport, insurance, freight handling, loading and additional costs;
17.2. customs duties, any other anti-dumping duties, as well as other taxes (fees) that are to be
paid in the importing state with respect to import or sale of goods; and
17.3. the undertaking's sales, administrative and other economic activity costs, as well as
profit.
IV. Comparison of Export Price and Normal Value
18. The Bureau shall determine the normal value and the export price of the investigated goods
and compare them for determination of the dumping margin in the following cases:
18.1. when deciding on the necessity of an investigation. In such case the Bureau shall
determine a preliminary dumping margin which shall be applied in taking a decision on the initiation
of an investigation, implementation of provisional measures and their amount;  andG/ADP/N/1/LVA/2/Suppl.2
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18.2. during the investigation. In such case, the Bureau shall determine the final dumping
margin that shall be applied in taking a decision on the application of anti-dumping duties and their
amount.
19. The comparison of the export price and the normal value shall be performed by the Bureau at
the same trade level (wholesale or retail), ordinarily at the level of producers’ prices, and a sale as
near in time as possible shall be selected.  The Bureau shall take into account the differences that
affect comparability of prices, and in each particular case, the normal value and the export price may
be adequately corrected.
20. If non-duplication of corrections is ensured, the Bureau may perform corrections, taking
20.1. physical properties of the goods.  The degree of correction shall correspond to
substantiated evaluation of the market value of differences in the physical properties of exported and
domestic goods;
20.2. customs duties.  The normal value shall be corrected to the extent as conforms to the
value-added tax, excise duty and customs duty applied to like goods and the constituent parts thereof,
if they are intended for consumption in the exporting state and are not collected, or are refunded, upon
the goods being exported to Latvia;
20.3. rebates and amount.  Corrections shall be performed, taking into account rebates,
including rebates that have been granted depending on the purchased quantity of the goods, if their
amount is appropriately determined and they are directly related to the sale of the relevant goods.
Corrections may also be performed, taking into account deferred rebates, if a practice exists in regard
to the application thereof, and there is complian ce with conditions regarding the granting of such
rebates;
20.4. level of trade. Corrections shall be made, taking into account differences in trade
levels, if it is apparent, with respect to the sale of goods in the exporting state and in Latvia, that the
export price has a different trade level in comparison with the normal value and this difference has
affected comparability of prices.  Stable and substantial differences in the functions of sellers, as well
as in the prices in various trade levels in the domestic market of the exporting state shall beindications regarding this.  The amount of corrections shall be based on the market value of this
difference;
20.5. transport, insurance, freight handling, loading and additional costs.  Corrections shall
be made, taking into account the differences in direct costs that arise when delivering the relevantgoods from the exporter to the independent purchaser if such costs are included in the price;
20.6. packaging. Corrections shall be made, taking into account the differences in costs that
are directly related to the packaging of the relevant goods;
20.7. credit.  Corrections shall be made, taking into account the differences in the costs of
credits granted for the sale of the relevant goods, upon the condition that this factor shall be taken into
account upon the determination of the price;
20.8. costs after sale.  Corrections shall be made, taking into account the differences in
direct costs related to guarantees, technical assistance and provision of services in accordance with
legal enactments or with purchase and sales contracts regarding the goods;G/ADP/N/1/LVA/2/Suppl.2
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20.9. commission fee.  Corrections shall be made, taking into account the differences in
commission fees regarding sale of the relevant goods;  and
20.10. conversion of currency. If converting of currency is necessary for the comparison of
prices, it shall be performed, taking into account the currency exchange rate on the day of sale of thegoods, except in cases where the sale of foreign currency is directly related to the sale of the relevant
export goods.  In the case referred to, the expected currency exchange rate for sale shall be utilised.
The expected currency exchange rate for sale is a specific currency exchange rate upon which the
relevant parties have agreed in regard to the day of payment, or another day on which the contract is
to be performed, and which is not dependent on the currency exchange rate in the market.  The date of
sale shall generally be the date of making out the invoice, however, the date the contract is entered
into, the date the goods are ordered or the date of confirmation of the order may be used, if such datesbetter reveal the essential conditions of the sale.  Fluctuations of the currency exchange rate shall not
be taken into account, and the exporters shall be given 60 days in order to correct their prices on the
basis of the average currency exchange rate during the period of the investigation.
V. Determination of Injury
21. Determination of injury shall be based on evidence and shall include the following
investigations:
21.1. the volume of imports at dumping prices;
21.2. the impact of imports sold at dumping prices upon the prices of like goods in Latvia;
and
21.3 the impact of imports sold at dumping prices upon domestic production.
22. In assessing the volume of imports at dumping prices, the Bureau shall determine whether
substantial increase of the volume of imports at dumping prices has taken place in absolute or relative
terms in relation to the domestic production or consumption in Latvia.
23. In evaluating the impact of imports sold at dumping prices upon the prices in the domestic
market of Latvia, the Bureau shall determine:
23.1. whether import prices are considerably lower than the prices of the domestic like
goods;  and
23.2. whether, due to imports, a substantial decrease of prices is taking place or an increase
of prices that would have taken place in othe r circumstances is being significantly hindered.
24. If imports of the relevant goods from two or more states are being investigated
simultaneously, the Bureau shall evaluate the aggregate influence of such imports only if it determinesthat:
24.1. the dumping margin that has been determined for the imports of each state exceeds
the minimum, and the import volume from each state cannot be regarded as small in accordance with
Section 9, Paragraph one, Clauses 2 and 3 of the Anti-Dumping Law;
24.2. the evaluation of the aggregate influence of the imports is appropriate, taking into
account the mutual competition of the imported goods and the competition of the like domestic goods.G/ADP/N/1/LVA/2/Suppl.2
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25. In investigating the impact of imports sold at dumping prices upon the relevant domestic
production sector, the Bureau shall evaluate the factors and indicators that characterise the state of the
domestic production, including:
25.1. the fact that the production sector is still trying to overcome the consequences of
dumping or subsidies arising in the past;
25.2. the actual and possible decrease of the utilisation of sales, profit, volume of
production, market share, productivity, profit from investments or production capacity;
25.3. factors affecting prices in the domestic market of Latvia;
25.4. the amount of the dumping margin;  and
25.5. the actual and possible negative consequences with respect to cash flow, stock of
goods, employment, salaries, economic development and attraction of capital or investments.
26. A determination by the Bureau as to imports of the relevant goods for dumping prices being
the cause of injury shall be based on all material evidence that has been obtained while performing the
investigations referred to in Paragraph 21 of these Regulations.
27. In addition to the imports at dumping prices, the Bureau shall also evaluate all other factors
known to be simultaneously causing injury to the domestic producers, including:
27.1. the import volume and prices, if the relevant goods are not sold at dumping prices;27.2. the decrease of demand or changes in consumption patterns;27.3. trade restrictions and competition between a third country and domestic producers;
and
27.4. technological development, as well as the export capacity and productivity of
domestic producers.
28. The Bureau shall evaluate the impact of imports sold at dumping prices upon the production
of like goods if the data available allow separate determination of the production of like domestic
goods on the basis of the production process, volume of sales and profit.  If such separate
determination of production is not possible, the impact of imports sold at dumping prices shall be
evaluated, investigating a group or assortment of goods divided as finely as possible, as contain likegoods and regarding which the necessary information is available.
29. Determination of threat of substantial injury shall be based on facts, not on allegations,
assumptions or possibilities.  Changes in circumstances, as might give rise to a situation in which
dumping would cause injury must be clearly foreseeable and unavoidable.  In order to determine theexistence of threat of substantial injury the Bureau shall evaluate the following factors:
29.1. a substantial rate of increase of imports sold at dumping prices in the domestic market
of Latvia as indicates the possibility of a substantial increase of imports in absolute or relative terms
in relation to the domestic production or consumption in Latvia;
29.2. a substantial increase in the capability of exporters in regard to selling their
production which indicates that the possibility of exports to Latvia, sold at dumping prices, isG/ADP/N/1/LVA/2/Suppl.2
Page 8
increasing, taking into account the availability of other export markets to receive any additional
exports;
29.3. whether the goods are imported at prices which will significantly reduce prices in the
domestic market or hinder an increase in prices that would have otherwise taken place and increasethe demand for such imports in the future; and
29.4. the stocks of the investigated goods.
VI. Receipt of Information and Investigation in Foreign States
30. Where necessary, the Bureau shall investigate information, as provided by exporters,
importers and foreign producers, in foreign states or obtain additional data.  The investigation may be
conducted, if agreement is reached with the relevant undertaking, and the government of the relevant
exporting state has been notified thereof and does not object to the conducting of such examination.
31. The Bureau shall take a decision on the performance of an investigation in foreign states after
the receipt of answers to questionnaires sent in accordance with Section 13 of the Anti-Dumping Law.
32. After taking a decision on conducting an investigation in a foreign state, the Ministry of
Foreign Affairs shall notify the government of the exporting state and the relevant undertakingsthereof, indicating the purpose of the visit.
33. If the government of the relevant exporting state has not objected, within 14 days from the
day the notification, regarding the conducting of an investigation, is sent, it shall be presumed that it
consents to the conducting of the investigation.
34. After the co-ordination of the dates for the investigation, the Ministry of Foreign Affairs shall
notify the government of the exporting state of the name and address of undertakings to be visited and
of the date of the investigation.
35. Not later than 14 days before the agreed date of the investigation the Bureau shall notify the
relevant undertakings of the exporting state of the general character of the information to beinvestigated, indicate the name and position of the representatives of the Bureau who will conduct the
investigation, as well as the additional information to be provided during the investigation.
Information that is not included in such notification, but is necessary for the clarification of
circumstances in accordance with acquired information, may be requested during the investigation.
36. Answers to questions asked by the government of the exporting state or by the relevant
undertakings, related to the conducting of the investigation in the exporting state, shall, if possible, be
provided before the visit.
VII. Proposal and Adoption of Price Adjustments
37. The Bureau shall propose price adjustments by sending a written draft of price adjustments to
the exporter.  If the exporter accepts the proposal, he or she will sign it, indicate the particulars of the
undertaking (company) and send it to the Bureau.
38. Before proposing price adjustments, the Bureau shall consult the domestic producers
regarding the effectiveness of price adjustments being proposed.G/ADP/N/1/LVA/2/Suppl.2
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39. The draft of the price adjustments may provide for:
39.1. readiness of the exporter to discontinue exports or increase prices (indicating the
amount of the increase of prices);
39.2. readiness of the exporter to refrain from avoiding compliance with the price
adjustments;
39.3. readiness of the exporter to provide to the Bureau all necessary information regarding
transactions with respect to the investigated goods;
39.4. readiness of the exporter to periodically inform the Bureau of the volume of sales of
the investigated goods and their price in the domestic market of the exporting country and of Latvia;
39.5. readiness of the exporter to co-operate and allow the Bureau to perform an
examination of the relevant data;
39.6. the right of the Bureau to cancel the price adjustments at any time, as well as the right
of the exporter to cancel them, upon giving notice to the Bureau prior thereto;
39.7. provisions in regard to mutual consultations between the Bureau and the exporter;
39.8. consent of the exporter to the continuation of the investigation in accordance with
Section 28, Paragraph two of the Anti-Dumping Law;
39.9. requirements for the contents of price adjustments invoices; and
39.10. other necessary provisions in regard to the performance of price adjustments.
40. Exporters who propose price adjustments shall prepare and submit to the Bureau a draft of the
price adjustments.  The Bureau shall evaluate the proposed price adjustments and decide on their
adoption.
41. The Bureau shall notify interested parties and customs authorities of the adoption of price
adjustments.
42. In the notification regarding adoption of price adjustments the Bureau shall indicate the
information prescribed in Section 46, Paragraph six of the Anti-Dumping Law, the time period within
which the interested parties may provide information and comments, as well as the decision oncontinuation or termination of the investigation in accordance with Section 28 of the Anti-Dumping
Law.
VIII. Registration of Investigated Goods and Annulment of Guarantees
43. Upon the recommendation of the Minister for Economics, the Cabinet shall assign to customs
authorities the registering of the investigated goods.
44. Registration of the investigated goods shall comprise the entering into the customs authority
registers of the date of import, volume, price, state of origin, name of the exporter and of the importer
and other data regarding the investigated goods, so that a subsequent retroactive application of anti-
dumping duties would be possible in accordance with Sections 36, 41 and 45 of the Anti-Dumping
Law.G/ADP/N/1/LVA/2/Suppl.2
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45. The State Revenue Service Customs Administration shall annul guarantees submitted during
the relevant period of provisional measures, if it has received a notification from the Bureau regarding
annulment of such guarantee in accordance with Section 35, Paragraphs three and four of the Anti-
Dumping Law.
Prime Minister A. B ērziņš
Minister for Economics A. Kalv ītis
These Regulations shall come into force on 20 July 2000.
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