WORLD TRADE
ORGANIZATIONG/SCM/N/1/KGZ/1
18 August 1999
(99-3479)
Committee on Subsidies
and Countervailing MeasuresOriginal:  English
NOTIFICATION OF LAWS AND REGULATIONS
UNDER ARTICLE 32.6 OF THE AGREEMENT
KYRGYZ REPUBLIC
The following communication, dated  12 August 1999, has been received from the Permanent
Mission of the Kyrgyz Republic.
_______________
TABLE OF CONTENTS
Page
Chapter 1 G eneral............................................................................................................... ..1
Chapter 2 State Superv ision [Control]..................................................................................4
Chapter 3 Initiation of  Investig ation.....................................................................................4
Chapter 4 Order/Procedure for De termination of Subsidies.................................................6
Chapter 5 Definiti on of Injury ............................................................................................12
Chapter 6 Conduct of Investiga tion....................................................................................14
Chapter 7 Completion of  Investig ation...............................................................................17
Chapter 8 Final Provisions..................................................................................................19
This Law shall establish the main notions and principles of the legislation on subsidies and
countervailing measures, as well as the order of investigation for establishing countervailable
subsidies, and conditions for the introduction and annulment of countervailing measures.
CHAPTER 1.  GENERAL
Article 1.  Terms and Definitions
This Law shall employ the following notions:
“Injury” shall mean material [financial] losses, caused as a result of importation of subsidized
goods  to domestic producers of similar goods, or a significant retardation in the organization and
expansion of production of similar goods in the Kyrgyz Republic;
“Threat of injury” shall mean a real possibility to cause  losses to domestic producers of
goods in future due to the supplies of similar subsidized goods subject to countervailing measures.G/SCM/N/1/KGZ/1
Page 2
“Provisional measures” shall mean preliminary countervailing measures applied in the form
of countervailing provisional duties, pledge liability or deposit of a sum of money;
“Interested parties” shall mean suppliers of a product subject to investigation, either a trade or
industrial association whose majority of members shall be suppliers of such a product, as well as thegovernment of exporting country, the government of the Kyrgyz Republic, a producer of the like or
directly competitive product in the Kyrgyz Republic , either a trade or industrial association whose
majority of members produce this product in the Kyrgyz Republic.
“Similar product” shall mean products which are identical or alike:- identical products  are the products similar in all respects;
- like products are the products which are not like in all respects, but have similar
characteristics and comprise of similar components;
“Supplier” - a producer, exporter or importer of a subsidized product being subject to
investigation;
“Countervailing measures” - a method of financial influence on the suppliers of a subsidized
product applied by in the form of provisional measures and countervailing duties for the elimination
of a threat of injury or injury resulted from importation of such product to the customs territory of the
Kyrgyz Republic for free circulation.
“Countervailing  duties shall mean duties applied by Customs Authorities of the Kyrgyz
Republic in case of importation of subsidized products to the customs territory of the Kyrgyz
Republic for free circulation, if such importation causes injury or threatens to cause injury to domestic
producers of similar or directly competing goods, or prevents the organization and expansion ofproduction of the similar goods in the Kyrgyz Republic;
“Objective criteria or conditions” shall mean criteria or conditions which are neutral and do
not favor certain enterprises in comparison with others and which are economic in their essence and
equal in application (the number of employees or size  of an enterprise). Criteria or conditions must be
clearly specified by legislation and other official documents.
“Domestic producers” shall mean Kyrgyz producers of goods similar or directly competing
with subsidized goods whose aggregate production c onstitutes the main part of their total domestic
production, except for interdependent producers.
“Official Bodies of the country” shall mean embassy, consulate, trade representation or
Authorized Body of the country involved into investigation.
“Investigation” shall mean a procedure for the consideration of documents and other
evidences in respect of importation to the customs territory of the Kyrgyz Republic of the subsidized
product, importation of which causes or threatens to cause injury to domestic producers of a similar ordirectly competing product;
“Subsidy” shall mean financial assistance by the State (or by a public organization) to a
certain enterprise or branch of industry and to a certain group of enterprises or branches of industry
that can be provided in the form of State grants, loans, liabilities guarantees, shares purchase orprovision of tax incentives, as well as provision of preferential prices for products cutting the costs of
production or trade;G/SCM/N/1/KGZ/1
Page 3
“Subsidized product” shall mean  the product, for production or exportation of which direct or
indirect subsidy was used, as a result, this product brings profit to the producer;
“Industrial research” shall mean a planned research work or an extremely necessary research
in order to obtain positive results in the area of new knowledge with the purpose that such knowledge
may be useful for the development of new products, processes or services or may provide significant
improvement of existing products, processes or services;
“Pre-competitive development activity” shall mean transfer of the results of industrial
research into the plan or the project for the creation of new, modified or improved products, processes
or services intended for sale or exploitation, including the creation of the first pilot sample which can
not be used for commercial purposes. Conceptual development and designing of alternative models ofproducts, processes or services, initial demonstration or pilot projects may also be included, provided
that these projects may not be used for industrial application or commercial purposes. The current or
periodical changes of existing products, production lines, technological processes, services or other
operations carried out in the normal order shall not be included, even if such changes may provide
improvements.
“Authorized Body” shall mean the State body  of the Government of the Kyrgyz Republic
conducting investigation in respect of import of a subsidized product upon application of interested
persons or on its own initiative.
Article 2.  Area of Application of This Law
1. This Law shall govern relations arising:
- as a result of causation of injury or threat of injury to domestic producers through
importation to customs territory of the Kyrgyz Republic, for free circulation, of goods
produced or being supplied with the attraction of subsidies;
- between the supplier of a subsidized product and official bodies of the country of export
or production, on the one hand, and the domestic producer or producers of a similar or
directly competing product and the authorized body, on the other hand.
Article 3.  Goals and Implementation Principles of This Law
1. The goal of this Law shall be protection of economic interests of the Kyrgyz Republic, as well
as the interests of domestic producers of goods against unfair competition on part of suppliers of
similar or directly competing goods produced or  exported with the attraction of subsidies.
2. The decision on the application of countervailing measures shall be made by the Government
of the Kyrgyz Republic as petitioned by the Authorized Body only under condition of presence of
consequences of injury or existence of a threat of injury to economic interests of the Kyrgyz Republic,as well as domestic producers, resulting from delivery of subsidized products.
3. Countervailing measures may be applied only in case when the investigation procedure was
undertaken in the accurate compliance with this Law.
Article 4.  Legislation of  the Kyrgyz Republic on Subsidies and Countervailing Measures
1. Legislation of the Kyrgyz Republic on subsidies and countervailing measures shall include
this Law, other legislative acts, and normative legal acts of the President and Government of the
Kyrgyz Republic adopted in compliance with them, as well as normative legal acts of the Authorized
Body.G/SCM/N/1/KGZ/1
Page 4
2. In the event that international treaty or agr eement ratified by the Kyrgyz Republic establishes
rules other than those contained in this Law, rule s of the international treaty or agreement shall be
applied.
CHAPTER 2.  STATE SUPERVISION [CONTROL]
Article 5.  State Supervision Bodies
1. General management of the State supervision over the trade practice of suppliers of  a
subsidized product shall be carried out by the Government of the Kyrgyz Republic pursuant to
legislation of the Kyrgyz Republic.
2. Direct activity on supervision and conduction of investigation of the facts of importation  of a
subsidized product shall be carried out by  the Auth orized Body to be determined by the Government
or established by the President of the Kyrgyz Republic in accordance with established procedure.
Article 6.  Authorized Body
1. The Authorized Body shall operate within the framework of authorities provided by this Law
and on the basis of Regulation to be approved by the Government of the Kyrgyz Republic.
2. In cases, stipulated by this Law, other legislative acts of the Kyrgyz Republic, acts of the
President and the Government of the Kyrgyz Republic, the Authorized Body shall, within its
competence, issue normative legal acts, as well as acts on investigation procedures.
3. In case of necessity to introduce countervailing duties, the Authorized Body shall submit
drafts of Resolutions to the Government of the Kyrgyz Republic.
4. While implementing its functions, the Authorized Body shall cooperate with official bodies of
other countries and international organizations.
CHAPTER 3.  INITIATION OF INVESTIGATION
Article 7.  Submission of Application
1. An application for conducting investigation of the facts of injury caused due to importation of
a subsidized product shall be submitted, in writing, to the Authorized Body by domestic producers or
on their behalf.
2. The application must contain the following information:
- name of the applicant and data on value and volume of production of the like product by
the applicant;
- a complete description of the subsidized product, name of the country or countries of its
origin or exportation, the list of all known suppliers of this product;
- evidence of existence, volume and character of subsidies;
- dynamics of supply of the subsidized product, its influence on the  prices of the like
product in the domestic market of the Kyrgyz Republic, and consequences of injury todomestic producers;
- the list of all known domestic producers of the like product, and known information on
value and volume of production of the like product, produced by the named producers.G/SCM/N/1/KGZ/1
Page 5
3. An application may be withdrawn by an applican t prior to the initiation of investigation and in
the course of it.  In case where the application has been withdrawn prior to the initiation of
investigation, it shall be considered not submitted. If the application is withdrawn in the process of
investigation, the Authorized Body shall be entitl ed to proceed  the investigation or terminate it
without measures undertaken.
4. In case where there is sufficient information to prove that the delivered product is subsidized
and causes injury, the Authorized Body may take a decision to initiate an investigation on its own
initiative without a written application.
Article 8.  Application Requirements
1. An application must be submitted on behalf of the domestic producers whose aggregated
output constitutes more than 50% of the total like product produced by that portion of the domestic
producers who have expressed their opinion with respect to the application. Producers supporting the
application shall account for not less than 25% of total production of the like products in the Kyrgyz
Republic.
2. An application that does not meet the above requirements shall not be subject to
consideration.
Article 9.  The Order for Consideration of Application
1. The Authorized Body must examine the accuracy and completeness of the information
indicated in the application and make a decision to hold investigation or refuse to hold investigation
within 45 days after submission of the application.
 
2. If the Authorized Body considers submitted information to be non-complete or insufficient itmust notify the applicant about this within 45 days as of receipt of an application. In the event the
applicant revises or supplement his application, the term of consideration of the application starts
from the date of receiving amendments and supplements.
Article 10.  Grounds for Refusal to Initiate Investigation Procedure
1. The Authorized Body shall take a decision on refusal to hold the investigation  in the
following cases:
- if there are no significant evidence of deliveries of subsidized product or there are no
consequences of injury from its deliveries;
- if individual share of deliveries from some country constitutes less than 1%, or if the
total for such countries is not more than 3% of internal consumption in the Kyrgyz
Republic;
- if the amount of subsidy is less than 1% of the product value.
2. After the decision on refusal to conduct investigation is made, the Authorized Body must
notify the applicant about that, stating the reasons for refusal.
Article 11.  Decision on Initiation of Investigation
The Authorized Body shall make a decision on initiation of investigation after study of all
obtained evidences on deliveries of the supposedly subsidized product, determining availability of
subsidies, their specificity, necessity and justification for the application of countervailing measures.G/SCM/N/1/KGZ/1
Page 6
Article 12.  Notification on Initiation of Investigation
1. After  the decision on initiation of investigation has been made, the Authorized Body shall:
- notify all known interested parties about the initiation of an investigation;
- publish notification in the official mass media edition.
2. Notification must contain information as follows:
- information on the initiation of investigation;
- the name of exporting country or countries and the product which is the subject to
investigation;
- the date of initiation of investigation;
- a brief review of the information received and request for additional information;
- terms for providing evidences and other data;
- terms for submission of applications\petitions.
- the time frame of hearing.
Article 13.  Review of Application
1. The Authorized Body shall, as soon as the investigation is initiated, provide the known
exporters and the Government of Exporting Country and other interested parties with the full text ofapplication at their request; confidential information is not subject to disclosure.
2. Where the number of the parties involved into investigation is too big, the Authorized Body
may provide the Official Bodies of the exporting coun try(s) or relevant trade association with the text
of the application.
CHAPTER 4.  THE ORDER FOR DETERMINATION OF SUBSIDIES
Article 14.  Subsidized Product
A product supplied from any country to the Kyrgyz Republic must be considered subsidized,
if it brings profit to the supplier from countervailable subsidies calculated on the basis of theprovisions of Articles16 and 17 of this Law.
Article 15.  Granting of Subsidies
1. A subsidy may be granted either by the government of the country of origin of the delivered
product, or by the government of an intermediate country from which the product is supplied
(hereinafter referred to as “an exporting country” or “the country of export”).
2. If the products are delivered not from the coun try of origin, but from the country of export,
the provisions of this Law shall be completely applicable, and the country of export shall beconsidered the country of origin.
Article 16.  Determination of Existence of Subsidies
1. Pursuant to this Law, the following types of financial assistance shall be deemed as subsidies:
(a) direct transfer of financial means (grants, loans and purchase of shares) by the
Government to a supplier  or indirect transfer of financial means or liabilities (loans
guarantees).G/SCM/N/1/KGZ/1
Page 7
(b) exemption from payment or decrease in the amount of duties and taxes as well as
delay of their payment during production or deliveries of the product that should be
considered subsidies in cases where the indicated privileges do not extend to the like
product intended for internal consumption.
Exemption  from payment of such duties or taxes in the amount not exceeding the calculated sums
shall not be deemed as a subsidy, under the conditi on that such exemption is granted in accordance
with the norms of international law;
(c) the Government shall provide goods or services (except for the provision of financial
and other means for the development of general infrastructure) or procurement of thegoods for suppliers;
(d) the Government shall make payments to the mechanism of financing; or authorize the
private structure or directs its activity in respect of one or several types of functions
stated in items (a) - (c) which usually would be laid on the Government, and on termsand conditions which  actually do not differ from the normal  practice used by the
Governments.
2. The subsidy exists if a benefit is thereby conferred.
Article 17.  Determination of Negligible Small/ De Minimis  Subsidy
1. In the process of investigation, the amount of countervailable subsidies may be considered by
the Authorized Body to be de minimis  if such amount is less than 1% of the value of the product to be
delivered, if the following conditions are observed:
(a) while supplying from the developing countries, de  minimis threshold shall not be
more than 2% of the value of the product to be delivered;
(b) for the WTO Developing Members, as well as for the WTO Developing Members
which have completely eliminated export subsidies defined in Article 18 paragraph 4
(a) of this Law,  de minimis  subsidy threshold shall be 3% of the value of the product
to be supplied.  In case of elimination of the export subsidies, this provision shall
apply from the date of notifying the WTO Committee on Subsidies and
Countervailing Measures of elimination of the export subsidies for the whole period
until the export subsidies are granted by the developing country concerned;
2. Investigation must be terminated if the amount of the countervailable subsidies established by
the Authorized Body is de minimis  for individual suppliers involved into investigation pursuant to this
Article.  A second investigation may be conducted with respect to these suppliers in the course of any
subsequent review carried out for the country or countries of these suppliers, pursuant to the
provisions of this Law.
Article 18.  Countervailability and Specificity of Subsidies
1. Countervailing measures may be applied to subsidized products only in the case where
subsidies are specific.
2. The subsidy shall be deemed to be specific for an enterprise or industry in the presence of the
following features:G/SCM/N/1/KGZ/1
Page 8
(a) where the body granting the subsidy or the legislation, pursuant to which this body
acts, limits the access of enterprises  to the subsidy;
(b) where the body granting the subsidy or the legislation, pursuant to which this body
acts,  establishes objective criteria or conditions governing the eligibility for, and theamount of, a subsidy. A subsidy can not be considered specific, provided that the
eligibility for a subsidy is automatic and that such criteria and conditions are strictly
adhered to.
(c) if, notwithstanding any appearance of non- specificity of a subsidy resulting from the
principles set forth in this paragraph, subparagraphs (a) and (b), there are reasons to
believe that the  subsidy may in fact be specific, other factors may be considered,such as:
- use  of the subsidy programme by a limited number of enterprises, predominant use by
certain enterprises, the granting of disproportionately large amounts of subsidy to  certain
enterprises, as well as the order of making a decision to grant a subsidy (information onthe frequency with which the applications for a subsidy are rejected or accepted and the
reasons for such decisions shall be considered.)
3. A subsidy granted to a limited number of enterprises located in a concrete geographical
region within the jurisdiction of a subsidizing body shall be specific. The setting or change ofgenerally applicable tax rates by all levels of government bodies entitled to do so shall not be deemed
to be a specific subsidy for the purposes of this Law.
4. The subsidies shall be deemed to be specific  if they meet the following requirements :
(a) subsidies contingent, whether solely or as one of several other conditions, upon
export performance,
(b) subsidies contingent, whether solely or as one of several other conditions, upon the
use of domestic over imported goods.
Subsidies shall be considered to be contingent in fact upon export performance when the facts
demonstrate that the granting of a subsidy  is in fact tied to actual or anticipated exportation or export
earnings.  The mere fact that a subsidy is provided to enterprises which export shall not for that reason
alone be considered  as export subsidy within the meaning of this provision.
Article 19.  Non-countervailable Subsidies
1. The following subsidies shall not be liable to countervailing measures:
(a) Subsidies which are not specific pursuant to Article18 paragraphs 2 and 3 of this
Law;
(b) Subsidies which are specific, pursuant to Article 18  paragraphs 2 and 3 of this Law,
but which meet the conditions provided for  in paragraphs 2, 3 and 4 of this Article.
2. Subsidies for scientific research works carried out by enterprises or higher education or
scientific research institutions on a contract basis with enterprises shall not be subject to
countervailing measures, if the subsidies are not more than 75 per cent of the costs of industrial
research or 50 per cent of the costs of pre-competitive development activity, and provided that such
subsidies are limited exclusively to:G/SCM/N/1/KGZ/1
Page 9
(a) Personnel costs (scientific-research employees, technicians and other supporting staff
employed exclusively for scientific research work);
(b) Costs of instruments, equipment, land and buildings used exclusively and
permanently (except for the cases when disposed of on a commercial basis) for
scientific research activity;
(c) Costs of consultations and equivalent services used exclusively for scientific research
activity, including the purchase of  scientific technical information, patents and etc;
(d) Additional overhead costs incurred directly as a result of scientific research work;(e) Other running costs (such as costs of  raw materials and materials, etc );
3. Subsidies to disadvantaged  regions within the territory of the country of origin or exporting
country, given pursuant to a general framework of economic development, and which would be non-specific if  the criteria laid down in paragraph 2 and 3 of Article 18 of this Law were applied to each
eligible region concerned, shall not be subject to countervailing measures provided that:
(a) Each disadvantaged region is a clearly designated  or contiguous geographical area to
the other regions with a definable economic and administrative identity;
(b) The region is considered as disadvantaged on the basis of neutral and objective
criteria, indicating that the region’s difficulties arise out of more than temporary
circumstances and such criteria must be clearly spelled out in legislation, norms and
other official documents, as well as provide the opportunity for verification;
(c) Neutral and objective criteria include a measurement of economic development which
shall be based on at least one of the following factors determined within a three-year
period:
- one of income indicators (income per capita, income per one member of the family or
GDP per capita) which must not exceed 85 per cent of the average  indicator for theterritory of country of origin or exporting country;
- employment rate, which must be at least 110 per cent of the average for the territory of
the country of origin or the country of export, but if such determination is difficult, it
may include other factors.
4. Subsidies for reconstruction and adaptation of the existing production facilities (production
facilities which have been in operation for at least two years at the time when new environmental
requirements are imposed) to new environmental protection standards required by law or norms that
make the enterprise obligated and impose financial penalties for violation of standards shall not be
subject to countervailing measures, provided that the subsidy:
(a) is a one-time non-recurring measure;(b) is limited to 20 per cent of the total reconstruction costs amount;
(c) does not cover the cost of replacing and operating equipment, purchased by means of
the subsidized investment, which must be fully incurred by firms;G/SCM/N/1/KGZ/1
Page 10
(d) is directly linked to the plans of an enterprise to reduce nuisances and pollution and
does not cover any manufacturing cost savings which may be achieved; and
(e) is available to all firms which can adopt the new equipment or technological
processes.
5. The allowable amounts of non-countervailable subsidy shall be established by reference to the
total eligible costs incurred over the duration of a concrete project.
In the programmes including both industrial research and pre-competitive development
activity, the allowable level of non-countervailable subsidy shall not exceed the  average of the
allowable levels of non-countervailable subsidy  applicable to these programmes, calculated on thebasis of all eligible costs set forth  in Article 18  paragraph 3 of this Law.
6. A general picture of regional development shall mean that regional subsidy programmes  are
part of an internally consistent and generally applicable regional development policy and that regional
development subsidies are not granted in isolated geographical points having no, or virtually noinfluence on the development of a region.
7. Neutral and objective criteria shall mean criteria which do not provide more than necessary
support to the certain regions in order to eliminate or reduce regional differences within the
framework  of the regional development policy. In  this regard, regional subsidy programmes shallinclude maximum amounts of subsidies which can be granted to each subsidized project. Such
maximum amounts must be differentiated according to the levels of development of eligible regions
and must be calculated on the basis of investment costs or the cost of job creation. Within these
maximum amounts, the distribution of subsidies must be sufficiently broad and even to avoid the
predominant use of a subsidy by, or  the granting of disproportionately large amount of  subsidy to,certain  enterprises. This paragraph shall be applied in the light of the criteria set out in Article 18
paragraphs 2 and 3 of this Law.
Article 20.  The Amount of Countervailable Subsidy and Period of Investigation
The amount of countervailable subsidies shall be calculated on the basis of the amount of
benefit received by a supplier.
In the process of investigation, the Authorized  Body shall review th e reporting documentation
of the suppliers involved into investigation, covering not less the six months preceding the date of
investigation  for which reliable financial and other data with respect to the investigation are
available.
Article 21.  Calculation the Amount of Benefit for the Recipient of a Subsidy.
When calculating the amount of benefit obtained by the supplier, the Authorized Body  shall
apply the following rules:
(a) The State share in the authorized capital of enterprises shall not be considered as a
benefit, if presence of the State share complies with the common practice of State
participation (including the provision of “risk” capital) at the investments of
enterprises  in the territory of the country of origin or export.
(b) A loan by a government shall not be considered a benefit, unless there is a difference
between the amount that the enterprise receiving the loan pays on the government
loan and the amount the enterprise would pay on a comparable commercial loanG/SCM/N/1/KGZ/1
Page 11
which the enterprise could obtain at the same period of time on the market. In this
case the benefit shall be the difference between these two amounts.
(c) A loan guarantee by a government shall not be considered a benefit, unless there is a
difference between the amount that the firm receiving the guarantee pays on a loanguaranteed by  the  government and the amount that the  firm would  pay for a
comparable commercial  loan in the absen ce of the government guarantee.  In this
case the benefit shall be the difference be tween these two amounts adjusted  for any
differences in fees.
(d) The provision of goods or services or purchases of goods by a government shall not
be considered a benefit unless the provision is made for less than adequate payment,or the purchase is made for more than adequate payment. The  adequacy of payment
shall be determined in relation to prevailing market conditions for the product or
service in question in the country of provision or purchase (including price, quality,
availability, marketability, transportation and other conditions of  purchase or sale).
Article 22.  General Provisions on Calculation of Countervailable Subsidies
The amount of countervailable subsidies  sha ll be determined accord ing to the following
provisions:
(a) The amount of countervailable subsidies  shall be determined  per unit of the
subsidized product imported to the Kyrgyz Republic.
(b) In establishing this amount from the to tal sum of subsidy, the following elements
must be deducted:
- application fee, or other necessary costs incurred in order to obtain right to a subsidy or
to obtain a subsidy;
- export taxes, duties or other collections levied on the supplied product specifically
intended to offset the subsidy.
(c) If the granting of the subsidy does not depend on the quantity of goods manufactured,
produced, exported or transported, the amount of countervailable subsidy shall be
determined by locating accordingly the total amount of subsidy over the level of
production, sales or export of the products concerned during the investigation period
for subsidization.
(d) Where the subsidy can be linked to the acquisition or future acquisition of fixed
assets,  the amount of the countervailable subsidy shall be calculated  by spreading
the subsidy  across a period of depreciation of such assets in the branch industry
concerned. The amount so calculated which is attributable to the investigation period,
including the amount linked to fixed assets acquired before this period, shall beallocated as described in subparagraph (c) hereof.
(e) Where a subsidy cannot be linked to the acquisition of fixed assets, the amount of
benefit received during the investigation period shall be attributed to this period and
allocated as described in subparagraph (c) hereof, unless special circumstances arisejustifying attribution over a different period.
Where an interested party claims a deduction, it must prove that the claim is justified.G/SCM/N/1/KGZ/1
Page 12
SECTION 5.  DEFINITION OF INJURY
Article 23.  Principles for Determination of Injury
A determination of injury shall be based on evidences and shall include an objective
examination of the volume of supplies and the effect of supplies on prices of like products in the
internal market, as well as consequences of these supplies for domestic producers of such products.
Article 24.  Study of the Volume of Supplies  and Prices of Products
1. When studying the volume of supplies, the Au thorized Body shall determine whether there
has been a significant increase in supplies, either in absolute  terms or with respect to production orconsumption in the Kyrgyz Republic.
2. When studying the effect of supplies on prices, the Authorized Body shall determine whether
there has been  a significant price undercutting on the product being supplied as compared with the
price of a like product in the market or whether the effect of such supplies is to depress, by other way,prices to a significant  degree or prevent price increase, which otherwise  would have occurred.
Article 25.  Determination of the Scale of Negligible Injury
1. The scale of injury shall be regarded as neglig ible where the share of supplies is less than the
share set force in Article  26 of this Law.
2. The volume of supplies from developing countries to the Kyrgyz Republic shall be considered
negligible if it represents less than  4 per cent of the total volume of supplies  of the like product to the
Kyrgyz Republic, and on condition that supplies from developing countries with the individual shareless than 4 per cent collectively account for not more than 9 per cent of the total volume of supplies of
the like products to the Kyrgyz Republic.
Article 26.  Cumulative Evaluation
Where supply of a product from more than one country is simultaneously subject to
countervailing duty investigations, the cumulative effect of such supplies shall be assessed only if it isdetermined that:
- the amount of countervailable subsidies established in relation to the supplies from each
country is more than  de minimis as established in Article 17 of this Law and that the
volume of supplies  from each country  is not negligible;
- cumulative assessment of the effect of the supplies is carried out both in the light of
competition between products being supplied and between the products being supplied
and the like domestic products.
Article 27.  Evaluation of the Impact of Supplies of the Subsidized Products on Domestic
Producers
1. Examination of the impact of supplies on domestic producers shall include evaluation of all
economic factors and indexes relevant to the case and affecting the condition of domestic producers,
including :
- the fact that  an industry or some producers are still in the process of recovering from
injury caused by supplies of  subsidized or dumped products in the past;
- the amount of countervailable  subsidies;G/SCM/N/1/KGZ/1
Page 13
- actual or potential decrease in sales, profits, output, market share;- productivity, return on
investments, utilization of production facilities;
- factors affecting  prices in the  Kyrgyz Republic;
- actual or potential negative impact on cash flow, inventories, employment, wages,
growth rates , ability to attract capital or investments and, in respect of agriculture,increase in the necessary expenditures to support programmes by the Government.
This list is not exhaustive. Neither one nor several of these factors can be decisive.
2. The Authorized Body shall assess the impact of supplies on the internal production of like
goods if available data permit to separate this production on the basis of the following criteria:
production process, sales by producers and profit. If such separation is not possible, the effect of thesubsidized supplies shall be assessed by the examination of the production of the narrowest group or
nomenclature of products including the like product, for which the necessary information can be
provided.
Article 28.  Evidence of Existing Injury
1. On the basis of actual data the Authorized Body must prove that the subsidized supplies cause
injury to domestic producers. Any actual data presented by the interested persons may serve as an
evidence of causal linkage between the supply of th e subsidized product and the injury to domestic
producers.
2. Known factors other than the supplies of subsidized products which at the same time are
injuring the domestic producers shall be examined  by  the Authorized Body, but this injury shall not
be attributed to the supplies of the subsidized pro duct. These factors, in particular, shall include the
volume and prices of non-subsidized goods, decrease of demand or changes in the consumptionpattern, restricted trade practice and competition between foreign and domestic producers, technologic
achievements as well as results of supplies and productivity of domestic industry.
Article 29.  Injury to Regional Producers
If in exceptional circumstances the Authorized Body divides the territory of the
Kyrgyz Republic  into two or more competitive markets, injury may be found to exist with respect toregional producers so determined even where a major portion of the total republican industry is not
injured, provided that there is a concentration of the subsidized goods in this market and supplies of
subsidized products are causing injury to the producers of all or almost all like products within  such
market.
Article 30.  The Threat of Injury
1. The Authorized Body shall make its determination\statement of a threat of injury to domestic
producers from supplies of subsidized goods on the basis of proved facts. The change of
circumstances creating the situation in which the supplies of subsidized products may cause  injurymust be clearly foreseen and inevitable.
2. In making a determination regarding the existence of a threat of injury, the Authorized Body
shall in particular consider the following factors:
(a) the nature of the subsidy  and the  trade effects likely to arise  therefrom;
(b) a significant growth of supplies of subsidized products, indicating the likelihood of
substantially increased volume of supplies;G/SCM/N/1/KGZ/1
Page 14
(c) availability of sufficient export potential of a supplier or inevitable substantial
increase in export potential indicating the likelihood of substantial increase in
supplies, taking into account the ability of other markets to absorb  any volume of
additional supplies;
(d) supplies at prices that will provide decreasing or depressing effect on the growth of
prices in the internal market, are likely to increase demand for additional supplies;
(e) inventories of the product being investigated.
None of these factors can have a decisive meaning by itself but the totality of the factors considered
must lead to the conclusion that further supplies of subsidized goods are inevitable and in the event of
non-application of countervailing measures injury  will be caused to domestic producers or delay in
the creation of appropriate  branch in domestic industry.
SECTION 6.  CONDUCT OF INVESTIGATION
Article 31.  Terms of Investigation
The period for investigation in respect of the subsidized product shall be up to six months. In
exceptional cases the investigation term may be extended for six months.
Article 32.  Request of Information
1. After the initiation of investigation the Authorized Body shall forward requests to the
interested parties.  The interested parties shall have 30 days for preparation of responses to thequestions. This term may be extended, but not more than for 30 days. The request shall be considered
as being received a week after it has been sent by mail or delivered to the  representative of the
interested party.
In the process of investigation, the Authorized Body may require additional information from
the interested parties, setting up a term by which the response must be given.
2. Each interested party shall have a right to submit any other evidences in written form, which
it considers to be necessary.
Article 33.  Confidentiality
1. Information being submitted as confidential to the Authorized Body in the process of
investigation, and having sufficient justification, shall be considered as such and shall not be disclosed
in any way without written authorization of the submitting party.
2. The party that provides confidential information must furnish a non-confidential explanatory
summary thereof.
The summary shall be enough detailed to make the substance of the information
understandable or shall explain the reasons why the provision of detailed non-confidential information
is impossible .
3. If the Authorized Body finds that a request for confidential information is not justified, or if
the supplier of the information is either unwilling to disclose information or does not authorize itsG/SCM/N/1/KGZ/1
Page 15
disclosure in generalized or summary form, the authorized body may disregard such information
except for the cases when it is proved that this information is authentic.
4. The person responsible for disclosure of confidential information shall bear the responsibility
pursuant to legislation of the Kyrgyz Republic
Article 34.  Verification at Place
In order to verify reliability of information or to obtain additional data with the agreement of
parties involved into investigation and the official  bodies of the country or countries involved into
investigation having no objections, and under observance of the norms of international law, the
Authorized Body may hold an investigation in the territory of these countries. In case of necessity,the investigation may be conducted in the territory of third countries upon the decision of the
Authorized Body and under observance of the provisions of this Article.
Article 35.  Sufficiency of the Information Available
In the event when any interested party does not submit the necessary data within the time
period offered by the Authorized Body or makes the investigation more difficult in any other way, the
Authorized Body shall be entitled to make any decision on the basis of data available.
Article 36.  The Order to Hold the Case
1. Each investigation shall be conducted by the Au thorized Body as a case in accordance with its
established form and in writing. All the documents re lated to  investigation shall be attached to the
case.
2. The materials of the case shall be presented to the interested parties for getting familiar upon
their request during investigation and in the process of case revision.
Article 37.  Hearings
1. The interested individuals shall have the right to submit  a petition to the Authorized Body to
conduct preliminary hearings of a case in order to get acquainted with the materials of a case as wellas arguments of the other party.
2. Hearings shall be conducted under the chairmanship of an official of the Authorized Body,
who shall ensure confidentiality. The representatives of the Authorized Body shall be present at
hearings as well as  the witnesses of the parties, who shall be informed in advance.
3. Additional hearings shall be possible only if the petition on additional hearings is justified.4. While conducting a hearing, a protocol shall be recorded. The interested sides shall be entitled
to provide additional information verbally. The verbal information, presented pursuant to the
requirements of this Article shall be considered after the written confirmation.
Article 38.  A Preliminary Positive Ruling
If the existence of injury from supplies of the subsidized product is confirmed by  evidences,
obtained in the process of investigation, the Authorized Body shall make a preliminary positive
ruling, which shall be a ground for undertaking of the provisional measures or acceptance of
undertakings on prices from the supplier.G/SCM/N/1/KGZ/1
Page 16
Article. 39  Notification on Imposition of Provisional Measures
A notification  about the intention to impose provisional measures shall be sent to all the
interested persons within 30 days before their application. Within 10 days after notification, the
persons involved into investigation shall be entitl ed to submit written comments  in respect of the
grounds for the imposition of provisional measures.
Article 40.  Publication of the Decision on Imposition of Provisional Measures
The provisional measures shall  be effective from the moment of publication of the decision
on introduction of provisional measures in the official mass media edition. The publication must
include the following data:
- names of suppliers or countries from which a product has been delivered;
- detailed description of a product (sufficient for customs purposes);
- established amount of a subsidy and full explanation of application of reasons for the
application of calculation methodology;
- injury evaluation criteria;
- main grounds for the imposition of the provisional measures;
- other information, necessary for understanding of actual circumstances and legal aspects.
Confidential information must not be included into publication.
Article 41.  Provisional Countervailing Measures and Order of Their Application
1. Upon reaching a preliminary positive ruling on the presence of countervailable subsidies and
injury, within a week, the Authorized Body shall send a notification to all interested parties andofficial bodies of their countries on the application of provisional countervailing measures. The
parties involved into investigation shall have the right to present their written comments in respect of
the grounds of imposition of provisional countervailing measures within the term established by the
Authorized Body.
2. Provisional countervailing measures shall be applied by the customs bodies of the
Kyrgyz Republic on the basis of a decision made by the Government of the Kyrgyz Republic aspetitioned by the Authorized Body.
3. The amount of provisional countervailing measures shall not exceed the preliminary
established total amount of subsidies, but may be less than this amount, if such amount is sufficient to
eliminate injury caused to domestic producers.
4. The provisional countervailing measures shall be established in the form of provisional
countervailing duties,  pledge liability or monetary deposit.
5. Release of goods for free circulation, in respect of which the provisional countervailing
measures are applied, shall be implemented only after the application of provisional measures.
6. In the event the amount of provisional measures exceeds the amount of subsidies, confirmed
in the process of investigation, the supplier shall be entitled to refund of the exceeding amount.  The
Authorized Body must make a decision about a refund of the amount paid over the amount ofsubsidies on the basis of petition. The refund shall be made within 30 days from the day of submission
of a petition.G/SCM/N/1/KGZ/1
Page 17
Article 42.  Terms for Application of Provisional Countervailing Measures
1. Provisional  countervailing measures shall be applied after the preliminary positive ruling is
made, but not earlier than in 2 months  and not later than 9 months from the beginning of
investigation.
2. The period of validity of provisional  measures must not exceed 4 months.
 
 Article 43. Investigation in Respect of the Third Parties
 
 1. An investigation in respect of a supplier not related to the supplier or suppliers of products
imposed by countervailing duties, and who started his deliveries after completion of an investigation,must be initiated within 30 days  and completed not later than 12 months from the day of receipt of an
application from him.
 
 2. In the process of investigation, the countervailing duties shall not be applied, however, the
Authorized Body shall be entitled to introduce the provisional measures pursuant to the orderstipulated by this Law.
 
 CHAPTER 7.  COMPLETION OF AN INVESTIGATION
 
 Chapter 44.  Completion of an Investigation
 
 1. The Authorized Body shall inform all the intere sted parties of the main facts, on the basis of
which a decision is made, no later than one month before the final decision is made.
 
 The interested parties may within 15 days submit their comments on the indicated facts.
 
 2. The investigation  conducted by the Authorized Body on evaluation of injury from import of
the subsidized product shall be finalized by making the following decisions:
 
 - termination of an investigation without undertaking  measures;
 - price undertakings;
 - introduction of countervailing duties;
 
 Article 45.  Grounds for Termination of an Investigation without Undertaking of Measures
 
 1. The investigation shall be terminated without undertaking of measures in case where it is
clear that there is no sufficient evidence of supplies of the subsidized product or injury resulting fromit.
 
 2. The investigation shall be terminated without undertaking of measures if it is determined  that
the amount of subsidies is de minimis  or the volume of supplies of the subsidized product (actual or
potential) or of injury is negligible pursuant to Article 10 of this Law.
 
 Article 46.  Price Undertakings
 
 1. The investigation shall be suspended or terminated without imposition of the provisional
countervailing measures or final countervailing duties after obtaining  the voluntary undertaking fromthe Government of the country granting a subsidy on the elimination of consequences or obligation of
the supplier to revise the price or terminate the supplies of the subsidized product which would
eliminate harmful consequences.
 G/SCM/N/1/KGZ/1
Page 18
 2. Increase of prices on such undertakings may not be more than it is necessary to compensate
for the amount of subsidies and in any case sufficient for the elimination of harmful consequences to
domestic producers.
 
 Article 47.  Conditions for Acceptance of Price Undertakings
 
 1. A price undertaking may be accepted by the Authorized Body only after a preliminary
positive ruling is made in respect of availability of subsidizing of production or supply of the product
as well as injury caused to domestic producers due to sales of these products.
 
 2. A price undertaking may not be accepted if the Authorized Body considers the acceptance  to
be practically impossible due to a great number of suppliers or due to other reasons. The AuthorizedBody must  inform suppliers or official bodies of the country about these reasons.
 
 Article 48.  Control over Observance of Price Undertakings
 
 1. The Authorized Body shall be entitled to demand from a supplier and official bodies of a
supplying country, whose undertaking was accepted, to submit data on execution of the accepted
undertaking, as well as  check of reliability of these data.
 
 2. In case of violation of the accepted undertakin gs by the Government of the supplying country
or by a supplier, the Government of the Kyrgyz Republic shall have the right to apply, as petitionedby the Authorized Body, provisional measures or, if an investigation has been completed and a
decision on availability of a subsidy or injury has been made, to introduce countervailing duties.
 
 Article 49.  The Effect of Price Undertakings
 
 1. The Authorized Body shall be entitled to termin ate an investigation in case of fair fulfilment
by a supplier of  price undertakings accepted.
 
 2. The Authorized Body shall proceed with the investigation after acceptance of price
undertakings in order to determine availability of subsidies and injury in the cases when a supplier,
who accepted price undertaking, insists on that or on its own initiative.
 
 3. Price undertaking shall be cancelled by the Authorized Body if the absence of subsidies or
injury is established.
 
 4. In any case, the price undertaking shall be in force till the full elimination of the consequences
of the injury.
 
 Article 50.  Notification on Ac ceptance of Price Undertaking
 
 1. After accepting price undertaking, the Authoriz ed Body shall forward a notification about it
to all the interested parties under observation of confidentiality pursuant to Article33 of this Law.
 
 2. Price undertaking shall be considered accepted in 7 days after the notification is sent by mail
or handed to the official bodies of the country.
 
 Article 51.  Levying of the Countervailing Duties
 
 1. On the basis of positive ruling of the Authorized Body and the decision of the Government of
the Kyrgyz Republic on introduction of countervailing duties, the Customs Bodies shall levy them on
all the supplied product in respect of which an investigation has been conducted, if a subsidy orG/SCM/N/1/KGZ/1
Page 19
subsidies are not revoked or it is not proved that subsidies are not profitable any more for the
suppliers involved into the investigation.
 
 A countervailing duty shall be levied by the Customs Body in the supply of the products that
come from all sources and bring profit from subsidies and are a cause of injury, excluding import bythose suppliers from whom the price undertakings have been accepted.
 
 2. In the decision on introduction of the countervailing duties, the supplier or suppliers of the
subsidized product shall be named.
 
 In the event if several suppliers from one country are involved into the case and it is
impossible to name all the suppliers, only the country shall be named.
 
 If several suppliers from more than one country are involved into the case, the Authorized
Body may name either all the suppliers involved or if it is practically impossible, each of the
countries-suppliers involved.
 
3. The countervailing duties shall be levied in addition to the customs duties, taxes and otherpayments.
 
4. None of the supplied products shall be subject to levying of countervailing and anti-damping
duties simultaneously.
Article 52.  Notification on Completion  of Inve stigation and on Introduction of Countervailing
Duties
The decision to introduce  countervailing duties shall be effective from the day of publication
of the decision of the Government of the Kyrgyz Republic in  the official mass media edition. The
publication shall contain information pursuant to Article 40 of this Law, as well as the reasons of
acceptance or rejection of arguments or demands of the suppliers.
Article 53.  Determination of an Amount of the Countervailing Duties.
The countervailing duties shall be established in the amount sufficient for elimination of
consequences of injury due to the import of the subsidized product. The amount of the countervailing
duties shall not exceed the amount of subsidies.
Article 54.  Term of Validity of Countervailing Duties
The term of validity of countervailing duties shall not exceed 5 years from the date of their
introduction or the last revision. The revision of validity term of the countervailing duty shall be
carried out by the Authorized Body on its own initiative or on the basis of an application submitted by
any interested party no later than three months before expiration of its validity. In case if it is
established by the Authorized Body, that termination of collection of duties will lead to continuationor resumption of import of the subsidized product, than duties shall be imposed on the product till the
elimination of the consequences of injury.
CHAPTER 8.  FINAL PROVISIONS
Article 55.  The Terms for Application of Countervailing Duties
1. The countervailing duties can not be imposed on the  subsidized product, released for
circulation before the date of initiation of an investigation.G/SCM/N/1/KGZ/1
Page 20
2. The countervailing duties shall be applied only to those subsidized products, which are in free
circulation after the decisions on introduction of these measures and duties have become effective,
except for the cases set up in the paragraphs 3 and 4 of this Article.
3. The countervailing duties may be applied  as of the date of introduction of provisional
countervailing  measures only in the cases if the Authorized Body has made a preliminary positive
ruling on the existence of injury or threat of injury and these measures have been applied to this
product.
4. The countervailing duties may be imposed on the product issued in free circulation not earlier
than 90 days before the date of introduction of provisional measures, if in the course of investigationit has been established, that an injury had been caused due to the massive import of a subsidized
product in the short period of time, and for recovery of consequences  caused by injury it is necessary
to impose the countervailing duties before the date of introduction of provisional countervailing
measures.
Article 56.  Calculation Procedure
1. If the amount of countervailing duty is more than the amount of effective provisional
countervailing measures, the difference shall not be collected. If the countervailing duty is less than
the amount of effective provisional countervailing measures, the difference shall be reimbursed or theamount of the duty shall be re-calculated.
2. Under determination of threat of injury by the Authorized Body, the countervailing duty may
be applied only from the date of passing a positive ruling on the existence of a threat of injury, and the
effective provisional countervailing measures must be cancelled, and any cash deposit made in theperiod of application of provisional countervailing measures shall be refunded, and any price
undertaking must be cancelled.
3. If in the process of an investigation, absence of subsidies and injury has been determined, all
provisional measures must be cancelled within 10 days, and the collected amounts shall be reimbursed
within 30 days pursuant to established order.
Article 57 .  Cancellation or Change of Measures
1. The Authorized Body may, no later than within three months, on its own initiative or on the
initiative of the interested parties, consider the necessity of continuation of  application of the
countervailing measures or a possibility for their change.
In case, if it is established, that the applicable measures are not justified, they must be
cancelled or their amount shall be changed.
Article 58.  The Order of Appealing the Decisions
Decisions made by the Authorized Body pursuant to this Law may be appealed by the
interested persons pursuant to the order stipulated by the legislation of the Kyrgyz Republic.G/SCM/N/1/KGZ/1
Page 21
Article 59.  The Order for the Implementation of the Law
The current Law shall be effective from the moment of its signing.
A. Akaev President of the Kyrgyz Republic
Adopted by the Legislative Assembly
of Jogorku Kenesh of the Kyrgyz Republic on 7 October 1998
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