WORLD TRADE  
ORGANIZATION  G/ADP/Q1/CHN/43 
G/SCM/Q1/CHN/43 23 April 2004 
 
(04-1840) 
Committee on Anti-Dumping Practices 
Committee on Subsidies and Countervailing Measures Original:   English 
 
 
  
NOTIFICATION OF LAWS AND REGULATIONS UNDER  
ARTICLES 18.5 AND 32.6 OF THE AGREEMENTS 
 
Replies to Questions from MEXICO
1 
Regarding the Notification of CHINA2 
   The following communication, received on 22 April 2004, is being circulated at the request of 
the Delegation of China. 
 
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I.  
 
Provisional rules of the Ministry of Foreign Trade and Economic Cooperation on initiation of 
anti-dumping investigations 
  
Article 3 
 
 Please explain under what circumstances the Mini stry may initiate an investigation on 
its own initiative? 
 
Reply
 
 
 In accordance with Article 18 of Regulati on on Anti-dumping of China, in exceptional 
circumstances that MOFCOM dose not receive  any written application for an anti-dumping 
investigation, but has sufficient evidence of dump ing, injury and causality between the two, it may 
decide to initiate the investigation.  At present th ere is no such a precedent in China’s practice of anti-
dumping investigation. 
 
Article 7 
  Please indicate the applicable criteria fo r considering that a domestic industry is 
fragmented for the purpose of using sampling methods.  Is this provision compatible with 
Article 5.4 of the Anti-Dumping Agreement?  
                                                     
 
1 G/ADP/Q1/CHN/28-G/SCM/Q1/CHN/28 
2 G/ADP/N/1/CHN/2/Suppl.1 G/ADP/Q1/CHN/43 
G/SCM/Q1/CHN/43 Page 2 
 
 
 Reply
 
  In accordance with Article 7 of Provisional Rules on Initiation of Anti-Dumping Investigation, in case the domestic industry is fra gmented and involving a large number of producers, 
MOFCOM may examine the standing of the applican t by using statistically valid sampling method.  
This is fully compatible with Article 5.4 of WTO Anti-Dumping Agreement.    
Article 16 
 
 When there is no comparable price in the ordinary course of trade, are the alternatives 
of the price for export to a third country and constructed value applied successively and 
exclusively in order to calculate normal value ?  Is there any criterion for their application? 
 
Reply
 
 
 Please explain what is meant in the first paragraph of Article 16 by the words "… where there is no comparable price or such price cannot be ob tained, the applicant shall provide the constructed 
value of the allegedly dumped import or the price for export to a third country".  In particular, on what 
assumptions is the phrase "or … cannot be obtained" based?  State also whether the People's Republic of China prefers constructed value information to  information on the price for export to a third 
country.  Finally, explain whether the choice of a third country would be applicable only if it is 
representative.  
 Please clarify the meaning of the sentence in the second paragraph of Article 16, which 
reads:  "… When the actual constructed value cannot be obtained, the applicant may calculate 
it on the basis of its own factors of producti on, the prevailing prices of these factors in the 
exporting countries (regions) or in the internatio nal market".  In particular, what assumptions 
underlie the use of the phrase "when the actual constructed value cannot be obtained". 
 
Reply
 
 
 In accordance with of Article 16 of Pr ovisional Rules on Initiation of Anti-Dumping 
Investigation, with regard to the determination of normal value,  the applicant shall provide the 
constructed value of the allegedly dumped import or the price for export to a third country where there 
is no comparable price or such price is not able to  be obtained.  Actually, when the applicant is not 
able to obtain the comparable price in the ordinary  course of trade of the like product for consumption 
in the exporting countries (regions) or countries (reg ions) of origin, the constructed value of the 
allegedly dumped imports will be taken as normal value in the petition.  The applicant may determine 
the normal value on the basis of its own factors of production, the prevailing prices of these factors in the exporting countries (regions) or in the international market when they could not obtain the constructed value.  
  
Article 26 
  How does the Chinese investigating authority pr oceed if the applicant does not provide a 
summary of information classified as confiden tial and does not explain the reasons for not 
providing such a summary?  Is there any classification of what is considered to be confidential information?  Is there any mechanism for access to information classified as confidential? 
  G/ADP/Q1/CHN/43 
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 Reply  
  In accordance with Article 26 of Provisional Rules on Initiation of Anti-Dumping Investigation, the applicant shall request for conf identiality treatment if the application for an anti-
dumping investigation contains confidential material s.  The applicant shall provide a meaningful non-
confidential summary for those confidential materials to permit other interest ed parties to have a 
reasonable understanding about the confidential material s.  The applicant shall give reasons if such 
non-confidential summary is not available.  The conf idential materials are regarded by the applicant 
as confidentiality when they may affect the interest  or advantage of production and sales of applicant. 
   
Article 38 
  How far in advance of issuing the public notice of initiation does MOFTEC normally 
notify the governments of exporting countries?  
Reply
 
  Usually MOFCOM will provide the embassies of the exporting countries with information 
about anti-dumping one week before issuing the Public Notice for initiation of investigation. 
  
Article 40 
  What criterion is used for determining that the number of exporters is "large"? 
 
Reply
 
  “Large” is concretely ascertained by MOFCOM on the basis of practical situation.   
Provisional rules of the Ministry of Foreign Trade and Economic Cooperation on the 
questionnaire on anti-dumping investigations   
Article 6 
  Is there an obligation to notify or provi de the public notice of initiation of the 
investigation to foreign exporters or produ cers whose domicile is known to the Chinese 
Government?  Does the twenty-day time-limit run from the date of such notification? 
 
Reply
 
  MOFCOM will notify and provide the public noti ce of initiation to all interested parties, 
including foreign exporters or producers whose do micile is known to MOFCOM, at the date of 
initiation of an anti-dumping case.  According to provisional rules on the questionnaire, the twenty-day time limit for registration begins from the date  of initiation, just the same day MOFCOM issues 
the public notice of initiation and notifies interested parties.   Article 23   Please explain the significance of the "letter of certificate … stating that the information submitted … is accurate and complete". 
 G/ADP/Q1/CHN/43 
G/SCM/Q1/CHN/43 Page 4 
 
 
 Reply
 
  Article 6.6 of Anti-Dumping Agreement requires that the authorities shall satisfy themselves 
as to the accuracy of the information supplied by  interested parties upon which their findings are 
based during the course of an investigation. An d the "letter of certificate … stating that the 
information submitted … is accurate and complete" is a necessary way to meet that requirement.  
  
Article 25 
 
 How is the responding company to guarantee a lack of intentional virus content in the 
electronic data carrier?  On what grounds is this  requirement considered to be consistent with 
Annex II of the Anti-Dumping Agreement? 
 
Reply
 
 
 The responding company can scan its electroni c data carrier with various anti-virus 
programmes in order to guarantee a lack of intentional virus when submitting the carrier.     Annex II of the Anti-Dumping Agreement stipulat es that the authorities ma y also request that 
an interested party provide its response in a par ticular medium (e.g. computer tape) or computer 
language.  So the requirement in Article 25 that the electronic data contains no virus is what Annex II 
of the Anti-Dumping Agreement allows the authoriti es to do.  And particularly, Article 25 is not 
inconsistent with Annex II because the following Artic le 26 shall be also observed in application of 
Article 25.  
 According to Article 26, if the responding company is unable to submit electronic data 
carriers or unable to submit electronic data carri ers according to the requirement, or it would be 
unduly burdensome for the responding company to s ubmit electronic data carri ers according to the 
requirement, the responding company may submit a written application of inability to submit 
electronic data carriers as required.   Provisional rules of the Ministry of Foreign Trade and Economic Cooperation on public hearings in anti-dumping investigations 
  
 Is a public hearing held in the context of every investigation?  Provided that an 
application has been submitted by an in terested party, in what cases other than force majeure  
and termination of the investigation is no public hearing held?   
  Are interpreters or translators allowed access to the hearings to advise participating exporters?  
Reply
 
 
 In most of cases, the authority always hold a pub lic hearing in order to give interested parties 
a full opportunity for the defence of their interests, whether in dumping investigation or injury investigation. Interpreters or translat ors are allowed access to the hearings. 
 
 According to the Article 19.3, though the h earing application has been submitted, some 
particular situations other than force majeure  and termination of the investigation may also result in 
the cancellation of hearing, for example, the hear ing applicant may be bankr upt and no one continues 
with the hearing application.   G/ADP/Q1/CHN/43 
 G/SCM/Q1/CHN/43 
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 Article 4 
  What does the Chinese Government consider to constitute national secrets, commercial 
secrets or personal privacy?  Does any legal instrument contain those criteria for the 
classification of information?  
Reply
 
  MOFCOM will consider what constitute nationa l secrets, commercial secrets, and personal 
privacy according to relevant provisions in Anti-Dump ing Agreement and its domestic laws. In China, 
the Law on Keeping Confidentiality of State Secrets defines national secrets, and the Law against Unfair Competition defines commercial secrets, and the question of personal privacy is addressed in the General Principles of Civil Law.   Article 19   Please clarify or provide examples of the kind of events referred to in paragraph 3 which would justify postponement or cancellation of the hearing. 
 
Reply
 
 
 In light of paragraph 3, besides the request from the hearing applicant and the termination of 
investigation, the hearing may be also postponed or  cancelled, if other matters justify that.  For 
example, some important interested parties or hear ing attendants other than the hearing applicant may 
also request the postponement a nd the authority may accept that. 
   
Provisional rules of the Ministry of Foreign Trade and Economic Cooperation on sampling in 
anti-dumping investigations  
  
Article 7 
 
 Does MOFTEC have any obligation to consid er the comments of interested parties on 
the selection of exporters and producers include d in the sample, and to respond to those 
comments? 
 
reply  
 
 It is provided in Article 7 of Provisional Ru les of Anti-Dumping Investigation by Sampling 
that the interested parties may make comments on the selection of exporters and producers within 
seven days after receiving the notice.  MOFCOM w ould give due consideration to such comments in 
the following investigation and respond to those co mments by a separate document, in the preliminary 
determination or in the disclosure to the inter est parties after the preliminary determination. 
  
Article 9 
   What is the "reserve list" and what purpose does it serve?  What is its significance? 
 Reply
 
  MOFCOM shall decide on selection of exporters and producers for samples on the basis of 
information submitted for registration for responding to the proceeding , and also establish a reserve G/ADP/Q1/CHN/43 
G/SCM/Q1/CHN/43 Page 6 
 
 
 list of samples, which is the “reserve list”.  In the event that some of those selected for inclusion in the 
sampling fail to co-operate or if  their dumping margin is zero or de minimis , MOFCOM might replace 
such companies by those on the reserve list in order to preserve representativeness. 
  Article 21 to 24   What provision of the Anti-Dumping Agreement can be used as a basis for considering the number of transactions as justification for sampling?  What criterion is used for determining that the number of transactions is too large? 
 
Reply
 
  The Anti-Dumping Agreement does not prohibit the use of sampling in cases where there are 
a large number of transactions.  In fact, a sampling concerning exporters or product types provided for 
in Article 6.10 of the AD agreement is inevitabl y tantamount to a sampling of transactions.  The 
method of sampling for transactions provided for in the Provisional Rules of Anti-Dumping Investigation by Sampling is reasonable since it is stipulated that sampling of transactions should be 
statistically valid and MOFCOM shall obtain th e agreement of the co-operating exporters and 
producers in question when deciding on the selected transactions.  
 Each investigation is treated as a separate case, since it is difficult to set uniform standard to 
different cases and different products.  Therefore, th e authority has to evaluate each case to determine 
whether the number of transactions involved is so large that investigation covering all transactions 
would be unduly burdensome and prevent the timely comp letion of the investigation.  If that proves to 
be the situation, the method of sampling for transactions would be used. 
  
Provisional rules of the Ministry of Foreign Trade and Economic Cooperation on disclosure of 
information in anti-dumping investigations  
  
Article 9 
 
 What interval is considered by the People's Republic of China as a "reasonable period 
of time" for disclosure to the relevant exporters and producers of information on the result of 
the on-the-spot verification? 
 
Reply
 
 
 The Anti-Dumping Agreement never set the time  limit for disclosure of the result of on-the-
spot verification. MOFCOM will make such disclos ure to the relevant exporters and producers as 
soon as the verification is completed a nd the verification report is finished. 
   Provisio
nal rules of the Ministry of Foreign Trade and Economic Cooperation on on-the-spot 
verification in anti-dumping investigations    Does MOFTEC carry out on-the-spot verificati on in respect of domestic producers?  If 
not, why not?  
Reply
 
  MOFCOM also conducts on-the-spot verifica tion in respect of domestic producers in the 
injury investigation, which is provided in the Rules of Injury Investigation for Anti-Dumping. 
Provisional Rules of Ministry of Foreign Tr ade and Economic Cooperation on On-the-spot  G/ADP/Q1/CHN/43 
 G/SCM/Q1/CHN/43 
 Page 7 
 
 
 Verification in Anti-Dumping Investigations mainly regulate the procedure of on-the-spot verification 
in dumping investigation.   
Article 11 
 
 How far in advance does MOFTEC notify exporters and producers of an on-the-spot 
verification? 
 
Reply
 
 
 MOFCOM always notify in advance the exporte rs and producers in question of the concrete 
timetable for the verification within a reasonable peri od before the verification is carried out.  How far 
in advance this period would be depends upon various situa tions of each case.  Generally, this period 
should give the investigating authority enough time to fulfil relevant procedures and also ensure that 
the companies concerned have enough time to prepare for the verification. 
 
Article 12 
  Are there penalties for non-governmental exp erts who do not abide by the obligation of 
confidentiality?  What are those penalties and in what set of rules are they contained? 
 
Reply
 
  Should there be any case that the non-government al experts do not abide by the obligation of 
confidentiality, the investigating authority of Ch ina shall take corresponding measures to deal with 
such behaviour of the experts stri ctly in accordance with relevant civil, administrative and criminal 
laws and regulations of China.  
Article 19 
  Are interested parties allowed to express an op inion on the classification of information 
contained in the summary of the result of the verification prepared by MOFTEC?  
Reply
 
  The interested parties may make comments on the disclosure of the result of the verification 
after receiving the disclosure. 
  
Provisional rules of the Ministry of Foreign Trade and Economic Cooperation on price 
undertakings in anti-dumping investigations  
  
Article 11 
 
 What is the reason for not accepting pri ce undertakings offered by exporters and/or 
producers who have not been fully cooperative during the investigation?  On what grounds is this consistent with the Anti-Dumping Agreement? 
 Reply
 
  Article 8.3 of ADA provides that price undert akings offered need not be accepted if the 
authorities consider their acceptance impractical.  MOFCOM considers the acceptance of the price 
undertakings offered by non-cooperating companies impractical since it would be difficult to G/ADP/Q1/CHN/43 
G/SCM/Q1/CHN/43 Page 8 
 
 
 determine whether its observance c ould be effectively monitored.  This article of Provisional Rules 
for Anti-dumping Price Undertakings is consis tent with the related provisions of ADA. 
  
Article 13 
 
 Does MOFTEC respond to the comments of  producers and exporters who have offered 
price undertakings? 
 
Reply
 
 
 Article 15 of Provisional Rules for Anti-dumping Price Undertakings states that Where MOFCOM considers acceptance of price undertakings  is not appropriate, it will notify the reason of 
rejection to the exporters or producers, and gi ve them adequate opportunities to make comments 
thereon. MOFCOM would give due consideration to such comments according to the law and respond 
to those comments by a separate document or in the subsequent final determin ation and disclosure.  
   
Article 23 
  Before cancelling the price undertaking, do es MOFTEC respond to the comments of 
producers and exporters? 
 
Reply
 
  Article 23 of Provisional Rules for Anti-dumpi ng Price Undertakings states that MOFCOM 
shall notify its intention of cancellation to th e exporters and producers who provided price 
undertakings within a reasonable period of tine befo re cancellation, and provide them with adequate 
opportunities to present their views. MOFCOM would give due consideration to the comments made 
by the exporters and importers providing the price undertakings according to the law and respond to those comments by a separate document to the inter est parties or in the determination of the 
cancellation.   Article 27   
 
 If the definitive anti-dumping duty is lower than the cash deposit, is the difference 
referred to in the last paragraph of this article refunded with interest? 
 Reply
 
  Until now, there has no such precedent in China.   
Provisional Rules of Ministry of Foreign Trade & Economic Cooperation on New Shipper 
Review In Anti-Dumping Investigations  
 
Article 5 
  Is a party which has only exported before the period of investigation entitled to request 
a new shipper review even if it has not exported aft er the original period of investigation.  If not, 
explain how that is compatible with the provisions of Article 9.5 of the Anti-Dumping 
Agreement.  Similarly, are "sufficient quantities" determined on a discretionary basis?  If not, 
how are they determined?  
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 Page 9 
 
 
 Reply  
  A new shipper review applicant should have  exported subject merchandise following the 
period of investigation.  Exports before the peri od of investigation may ha ppen very long ago and 
shall not be treated as the basis to determine marg ins of dumping.  Also the period of review should 
be a period following the period of original investigati on.  This requirement is in conformity with the 
WTO rules and international practices.   The “sufficient quantities” is determined on a case by case basis, and should be determined 
according to the product under consider ation and specific market conditions. 
 
Article 21 and 22 
  If no preliminary determination is made, at  what point in time may a price undertaking 
be offered?  
Reply
 
  The applicant may offer a price undertaking within 15 days after the MOFCOM issues a disclosure.  
  
Article 23 
  Explain how the fact of the investigated product being subject to an anti-dumping duty during the new shipper review is consistent with Article 9.5 of the Anti-Dumping Agreement. 
 
Reply
 
  According to Art 9.5 of ADA, the authority may withhold appraisement and/or request guarantees.  After MOFCOM makes the disclosure that there is dumping, the applicant may make price undertaking.  Therefore, the exports during the review shall be levied anti-dumping duties. 
 
Article 26 
  When the anti-dumping duty is lower than the cash deposit, is the difference refunded with interest? 
 
Reply
 
  Until now, there has no such precedent in China.   
Provisional Rules of Ministry of Foreign Trade & Economic Cooperation on Refund of Anti-
Dumping Duty  
Article 18 
  Is the difference between the dumping margin determined in the original anti-dumping 
investigation and the dumping margin ne wly determined refunded with interest? 
 
Reply
 
  Until now, there has no such precedent in China. G/ADP/Q1/CHN/43 
G/SCM/Q1/CHN/43 Page 10 
 
 
   
Provisional Rules of Ministry of Foreign Trade & Economic Cooperation on Interim Review of 
Dumping and Dumping Margins   
 On the basis of the provisional rules on int erim review, can consideration be given to the 
likelihood of the continuation or recurrence of injury in the event of termination or modification of the duty?  If not, what rules govern that aspect? 
 
Reply
 
 
 In Interim Review of Dumping and Dumpi ng Margins, the injury aspect will not be 
considered.  Please refer to the Anti-Dumping Regulation of China.   
Article 7 
 
 Please clarify the concept of "suffici ent quantities" and "normal commercial 
conditions", as referred to in the second paragraph of Article 7. 
 
Reply
 
 
 The “sufficient quantities” and “normal comme rcial conditions” are determined on a case by 
case basis, and should be determined according to the product under consideration and specific market 
conditions.   Article 16 : 
  
 Does MOFTEC respond to the comments of pr oducers and exporters on whether or not 
an interim review should be initiated?  If so, in what way and within what period of time? 
 
Reply
 
 
 MOFCOM will not respond to the comments of producers and exporters but will give due 
consideration to all comments of pro ducers and exporters during the review. 
  
Article 26 
 
 Explain the reasons why exporters a nd producers whose dumping margins were 
determined as zero or de minimis  in the original anti-dumping investigation are included in the 
interim review? 
 
Reply  
 
 Exporters and producers whose dumping margin was determined as zero or de minimis  will 
be determined as no dumping.  However, they shall s till be subject to the review if domestic industry 
applies for a review on all exporters and producers of the exporting country. 
  
Article 33 
 
 Under what circumstances is no preliminary determination made? 
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 Page 11 
 
 
 Reply  
  MOFCOM will not make preliminary de termination in review procedures. 
  Article 35   If no preliminary determination is made, at  what point in time may a price undertaking 
be offered? 
 reply
 
  MOFCOM will give a disclosure to interested parties based on the facts and reasons on which 
the preliminary conclusion is made.  The exporter may offer a price undertaking within 15 days after 
the disclosure.  
  
II. 
 Rules on investigations and determinations of industry injury for anti-dumping 
 
 How does the Chinese Government reconcile it s provisions on the use of the best 
information available with the provisions of Annex II of the Anti-Dumping Agreement?  
Reply
 
  The investigating authority uses the best inform ation available according to Article 42 of the 
Rules, which was made in accordance with the pr inciples of the WTO Anti-Dumping Agreement and 
the provisions of Annex II.  
Article 34 
  On the basis of what criteria may the request for a hearing be refused? 
 
Reply
 
  We do not have fixed criteria to decide whethe r a public hearing is to be held.  Usually the 
investigating authority wouldn’t refuse the request if the interested parties make an application. 
 
Rules on public hearings with regard to investigations of injury to industry 
 
Article 21 
  Please clarify or provide examples of the type  of circumstances referred to in paragraph 
3 which would justify suspension of the hearing or its termination.  
Reply
 
  In the Rules, suspension and termination of hearing are provided for under Article 21 and 23 
respectively.  
 
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