WORLD TRADE
ORGANIZATIONTN/RL/W/91
1 May 2003
(03-2323)
Negotiating Group on Rules Original:  English
“LIKE PRODUCT” WITHIN THE MEANING OF THE WTO
ANTI-DUMPING AGREEMENT
Submission by Australia
The following communication, dated 30 April 2003, has been received from the Permanent
Mission of Australia.
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Introduction
Australia notes that there have been a number of contributions to the Rules Negotiating Group
on the issue of “like product” and “product under investigation”, for example document TN/RL/W/10.
Australia considers that it is appropriate to consider the provisions of Article 2.6 of the WTO
Anti-Dumping Agreement (ADA) having regard to recent WTO jurisprudence to reflect more fully
the approach being taken by anti-dumping administrations and to give greater clarity to ADA
Article 2.6 than exists at present.
While the Japan Alcoholic Beverages  case1 noted that the term “like product” appears in
various GATT provisions and that it did not necessarily follow that the term had to be interpreted in a
uniform way, ADA Article 2.6 notes that the term “like product” applies “throughout this
Agreement”.  Accordingly, would there be merit in giving consideration to interpreting the term
differently according to the provision, for example, a test of the actual physical characteristics for the
purpose of Article 2.2, a market focus test fo r the purpose of Articles 3 and 4 of the ADA?
Background
Article 2.6 of the WTO Anti-Dumping Agreement states
“Throughout this Agreement the term “like product” (“produit similaire”) shall be
interpreted to mean a product which is identi cal, i.e. alike in all respects to the
product under consideration, or in the absence of such a product, another product
which, although not alike in all respects, has characteristics closely resembling those
of the product under consideration.”
For the purpose of this paper Australia is only concerned with the first half of the definition
i.e. what is meant by the term identical and will examine that term in the light of recent panel
decisions.
                                                     
1 Japan – Taxes on Alcoholic  Beverages,  Report of the Panel, WT/DS8/R, WT/DS10/R and
WTDS11/R, 11 July 1996, hereinafter Japan Alcoholic Beverages .TN/RL/W/91
Page 2
The crucial  question is what constitutes identical and how is it to be measured.  The answer is
straightforward where the goods being imported and the goods being produced are exactly the same.
As a fundamental proposition, it has been accepted that the definition of likeness is based on the
physical characteristics of goods.  It has never been based on a pure market test.  However there hasbeen an acceptance that the goods produced on the home market may be at the very least presented
differently when sold on an export market, but that these differences did not mean that the goods were
not identical.  This approach of regarding identica l to mean something less than goods being exactly
the same has been supported by the reference to ‘produit similaire’ in the definition of like products as
requiring similarity between goods, not that they be exactly the same.
The Japan Alcoholic Beverages  case, although not based on the definition of like product
contained in the WTO Anti-Dumping Agreement, made some general observations on like product
and in reviewing previous panels found that criteria  had been developed.  That analysis provides
useful guidance on interpretation of like product  for the purpose of the WTO Anti-Dumping
Agreement.  Furthermore, the criteria  used in the Japan Alcoholic Beverages  case is gaining
acceptance in anti-dumping administrations as useful and non-exclusive criteria to determine whatconstitutes a like  product.  However, there will inevitably be a need for an exercise of judgement in
coming to a decision on “like products”.
The Japan Alcoholic Beverages  panel noted that previous panel and working party reports
had unanimously agreed that the term “like product” should be interpreted on a case-by-case basis.
2  It
further noted that panels had used different criteria to establish likeness.  The Japan Alcoholic
Beverages  panel recalled that previous panels had used different criteria to establish likeness such as
the product’s properties, nature and quality, and its end-uses; consumers’ tastes and habits, which
change from country to country; and the product’s classification in tariff nomenclatures (para 6.21
refers).
The Japan Alcoholic Beverages  panel examined, in the context of GATT Article III and the
Interpretative Note ad Article III, the distinction between “like” and “directly competitive or
substitutable products”.  It noted that the latter should be interpreted more broadly than “like product”
and that like products should be viewed as a subset of directly competitive or substitutable products.
The appropriate test to define whether two products are “like” or “directly competitive or
substitutable” is the marketplace.  The decisive criterion, according to the panel, to determine whethertwo products are directly competitive or substitutable is whether they have common end-uses.  In
terms of “like products”, however, such a criterion is necessary but insufficient to define likeness.  For
two products to be “like”, they must share essentially the same characteristics, apart from
commonality of end-uses.
Issues to consider
It may be said that the WTO jurisprudence has reached a point  where there is now clear
guidance on how the term “like” should be understood.  To include in the definition of like  product
non-exclusive, non-hierarchical criteria would be helpful in giving guidance on how to interpret theterm in the context of the WTO Anti-Dumping Agreement  and in light of clarifications provided
through relevant WTO jurisprudence.
Notwithstanding that ADA Article 2.6 provides that the term “like product” be applied
consistently throughout the Anti-Dumping Agreem ent, Australia would welcome views on the merits
of whether consideration should be given to developing separate criteria for consideration of like
                                                     
2 Japan –Taxes on Alcoholic Beverages , Report of the Panel, WT/DS8/R, WT/DS10/R and
WTDS11/R, paragraph 6.21.TN/RL/W/91
Page 3
product  under ADA Article 2 for the pu rpose of determining a dumping margin, ADA Article 3 for
the purpose of determining injury and ADA Article 4 for the purpose of defining domestic industry.
One view is that a market focus test, as reflected in the Japan Alcoholic Beverages  case, is
appropriate to be used in assessing the like goods produced by a domestic industry.  The ultimatereason for considering the effect of dumped goods causing material injury is whether they compete in
the same market.  However, for the purpose of making a determination under ADA Article 2, a test
which concentrates more on the actual physical characteristics, e.g. physical characteristics and
Customs classification, may be sufficient.
Questions for consideration
(a) Should non-hierarchical non-exhaustive criteria, based on the criteria set out in the Japan
Alcoholic Beverages  case, be incorporated in the definition of what constitutes “like goods”?
(b) Should consideration be given to replacing the word “identical” with “goods, which have
essentially the same physical characteristics” as part of the process of specifying criteria forthe purpose of determination of dumping and determination of injury, as well as for the
definition of domestic industry?
(c) Should separate criteria be developed which make a distinction for the purpose of ADA
Article 2 relating to determination of dumping and ADA Article 3 relating to determination ofinjury?
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