WORLD TRADE  
ORGANIZATION  WT/DS312/2 
20 August 2004  
 
(04-3485) 
 Original:   English 
   
KOREA – ANTI-DUMPING DUTIES ON IMPORTS 
OF CERTAIN PAPER FROM INDONESIA 
 
Request for the Establishment of a Panel by Indonesia
 
  
 The following communication, dated 16 Augus t 2004, from the delegation of Indonesia to the 
Chairperson of the Dispute Settlement Body, is ci rculated pursuant to Article 6.2 of the DSU. 
 
_______________ 
  
 On 4 June 2004, the Republic of Indonesia ("I ndonesia") requested consultations pursuant to 
Article 4 of the Understanding on Rules and Pro cedures Governing the Settlement of Disputes 
("DSU"), Article XXII:1 of the General Agr eement on Tariffs and Trade 1994 ("GATT"), and 
Article 17 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs 
and Trade 1994 ("AD Agreement") regarding the im position by the Republic of Korea ("Korea") of 
definitive anti-dumping duties on imports of bus iness information paper and uncoated wood-free 
printing paper from Indonesia
1 and certain aspects of the investigation leading thereto.  The request 
was circulated on 10 June 2004 as document WT/DS312/1, G/L/681, G/ADP/D54/1.  Korea and Indonesia held consultations in Geneva on 7 July 20 04.  However, consultatio ns have failed to settle 
the dispute. 
 
 Article 1 of the AD Agreement requires that "[a]n anti-dumping measure shall be applied only 
under the circumstances provided for in Article VI of GATT 1994 and pursuant to investigations 
initiated* and conducted in accordance with the pr ovisions of [the AD] Agreement" [*footnote 
omitted].  Indonesia considers that Korea's defi nitive anti-dumping duties on imports of business 
information paper and uncoated wood-free prin ting paper from Indonesia do not meet these 
requirements.  In this regard, Indonesia notes the following:  
Relating primarily to the initiation of the investigation
 
  1. Korea initiated the investigation notwithst anding its failure to make a determination 
that the application had been made by or on be half of the domestic industry.  This is 
inconsistent with Article 5.4 of the AD Agreement. 
  2. Korea's determination that business information paper and uncoated wood-free 
printing paper are like products is inconsiste nt with the definition of "like products" 
as set out in Article 2.6 of the AD Agre ement. Consequently, the definition of 
"domestic industry" utilised by Korea in its determination that the application has 
been made by or on behalf of the "domestic  industry" is flawed.  For this reason, 
Korea's initiation of the investigation is  inconsistent with Article 5.4 of the 
AD Agreement.   
 
                                                     
 
1 Imposed under Resolution No. 2003-22, issued by Korea Trade Commission dated 
24 September 2003. WT/DS312/2 
Page 2  
 
 3. Korea initiated the investigation notwith standing its failure to make an objective 
examination of the participation of the app licant Hansol Paper Co. ("Hansol") in the 
definition of "domestic industry", despite Hansol's significant volume of imports from 
Indonesia during the period of investigation fo r injury.  This is inconsistent with 
Article 3.1 and Article 4.1(i) of the AD Agreement. 
 
 4. Korea initiated the investigation notwithst anding the failure of the applicants  to 
include in the application sufficient and adequate evidence of dumping, injury, and 
causal link between the alleged dumped imports and the injury, particularly in respect 
of: 
 
(i) the occurrence of certain injury factors, inter alia, market share, domestic 
prices, output, profits, ability to ra ise capital or investment, employment, 
productivity, actual and potential negativ e effects on cash flow, growth, and 
the magnitude of the margin of dumping, 
(ii) the existence of causal link between th e alleged dumped imports and injury, 
as the information and evidence on injury  submitted by the applicants relate 
to a period of investigation (1999-2001) during which – except for the quarter October to December 2001 – there was no occurrence of dumping for the purpose of the investigation (according to the Notice of Initiation, the period of investigation for dumping was 1 October 2001 to 30 September 2002), 
  In these circumstances, Korea's initiation of  the investigation is  inconsistent with 
Article 5.2 and Article 5.3 of the AD Agreement. 
  5. Korea initiated the investigation notwithst anding that the period for injury and the 
period for dumping overlapped only for a peri od of three months.  Korea's failure to 
simultaneously  consider  the evidence of both dumping and injury in the decision to 
initiate the investigation is contrary to Article 5.7 of the AD Agreement. 
  6. Korea failed to provide in the Notice of Initiation any information regarding the 
factors on which the allegation of injury was based.  This is inconsistent with 
Article 12.1.1(iv) of the AD Agreement. 
 
 7. Korea granted confidential treatment to information contained in the domestic 
industry's application and to supplementa ry information provided by the domestic 
industry without (i) requiring the applican ts or the domestic industry to provide 
showing of good cause for such a treatment, (ii) requiring the applicants or the 
domestic industry to furnish non-confiden tial summaries "in sufficient detail to 
permit a reasonable understanding of the subs tance of the information submitted in 
confidence", or (iii) any indication that th e information could not be summarized and 
the reasons why summarization was not possibl e.  The granting of such confidential 
treatment without requiring the showing of good cause is inconsistent with Article 6.5 
of the AD Agreement.  Furthermore, Korea' s failure to require the furnishing of non-
confidential summaries or any indication that that information could not be 
summarized and the reasons why summarization was not possible are contrary to Article 6.5, Article 6.5.1 and Article 6.5.2 of the AD Agreement. 
 Relating primarily to the conduct of the investigation
 
 
 8. Korea requested information on a firm wh ich was not subject to the investigation – 
i.e. PT Cakrawala Mega Indah ("CMI") - wit hout having obtained the agreement of 
that firm, and without having notified the Gove rnment of Indonesia of such request in  WT/DS312/2 
 Page 3 
 
 
the context of an on-the-spot investigation.  This is inconsistent  with Article 6.7 and 
Annex I of the AD Agreement. 
  9. Korea did not consider and accept inform ation related to the sales of CMI and the 
financial statements of CMI, notwithsta nding that they were (i) verifiable, 
(ii) appropriately submitted and could be  used without undue difficulties, and  
(iii) submitted in a timely fashion.  This  is inconsistent with Article 6.8 and 
paragraphs 3 and 5 of Anne x II of the AD Agreement. 
  10. Korea failed to explain the reasons fo r its non-acceptance of the information related 
to the sales of CMI and the financial statements of CMI .  This is inconsistent with 
Article 6.8 and paragraph 6 of Annex II of the AD Agreement. 
 Relating primarily to the preliminary determination
 
 
 11. Korea's determination that business information paper and uncoated wood-free 
printing paper are like products is inconsiste nt with the definition of "like products" 
as set out in Article 2.6 of the AD Agreement.  Furthermore, Korea's failure to explain this conclusion in sufficient detail is  contrary to the requirements set out in 
Article 12.2 of the AD Agreement. 
 
 12. Korea's resort to constructed value as the basis for determining normal value for 
PT Pindo Deli and PT Indah Kiat is inconsistent  with Article VI:1 and Article VI:2 of 
GATT and Article 2.1 and Article   2.2 of the AD Agreement. 
  13. Korea's construction of the normal value in respect of PT Pindo Deli and PT Indah 
Kiat without taking into consideration actual data from CMI pertaining to sales in the 
ordinary course of trade of the like products  subject to investigation, notwithstanding 
the fact that all information requested by Korea was supplied by the exporters in time, 
is inconsistent with Article 2.2, Artic le 2.2.1.1, and Article 2.2.2 of the 
AD Agreement. 
 
 14. Korea's resort to best information ava ilable in order to construct administrative, 
selling and general costs of PT Pindo Deli a nd PT Indah Kiat is inconsistent with 
Article 6.8 and paragraphs 3, 5 and 6 of Annex II of the AD Agreement. 
  15. Korea failed to provide in sufficient detail findings and conclusions reached on the 
determination of normal value.  In particul ar, Korea failed to provide details of the 
amounts for, and methods and evidence used in determining, cost of production, 
administrative, selling and general costs, financial expenses and profits.  This is 
inconsistent with Article 12.2 of the AD Agreement. 
  16. Korea's failure to make a fair co mparison between the export price and the 
constructed normal value of PT Pindo Deli and PT Indah Kiat inter alia , by failing to 
take into account that domestic sales were made through an  intermediary – CMI – 
while export sales were made directly to cons umers, is inconsistent with Article VI:1 
and Article VI:2 of GATT and Article 2. 1 and Article 2.4 of the AD Agreement. 
 
17. For exporters who did not submit information to Korea ( i.e., PT Tjiwi Kimia and 
unidentified exporters of Indonesia), Korea arbitrarily applied the "best information 
available" to determine the dumping margin for Tjiwi Kimia.  This  is inconsistent 
with the provisions of Article 6.8 and pa ragraph 7 of Annex II of the AD Agreement. WT/DS312/2 
Page 4  
 
 18. Korea failed to immediately terminate the investigation in respect of PT Indah Kiat 
notwithstanding its determination that the margin of dumping for PT Indah Kiat was 
de minimis.  This is inconsistent with Artic le 5.8 of the AD Agreement.  
 Relating primarily to the final determination
 
 
 19. Korea's determination that business information paper and uncoated wood-free 
printing paper are like products is inconsiste nt with the definition of "like products" 
as set out in Article 2.6 of the AD Agreement. Furthermore, Korea's failure to explain this determination in sufficient detail , notwithstanding the views expressed by 
Indonesian exporters that business info rmation paper and uncoated wood-free 
printing paper are not like products, is contrary to Article 12.2 of the AD Agreement.  
  20. Korea's failure to determine indivi dual margins of dumping for PT Indah Kiat, 
PT Pindo Deli and PT Tjiwi Kimia is contrary to Article 6.10 of the AD Agreement.  
In the light of this claim, the consequent  levy of an anti-dumping duty in excess of 
individual margins of dumping, if any, is  inconsistent with the requirements of 
Article VI:2 of GATT and Article 9.3 of the AD Agreement.  
  21. Korea's determination of a single norma l value, export price and dumping margin for 
PT Indah Kiat, PT Pindo Deli and PT Tjiwi Kimi a is inconsistent with Articles 2.1, 
2.2 and 2.4 of the AD Agreement.  
  22. Korea's resort to constructed value as the basis for determining normal value for 
PT Pindo Deli and PT Indah Kiat is inconsistent  with Article VI:1 and Article VI:2 of 
GATT and Article 2.1 and Article 2.2 of the AD Agreement. 
 
 23. Korea's construction of the normal value in respect of PT Pindo Deli and PT Indah 
Kiat without taking into consideration actua l data, including data pertaining to sales 
of CMI in the ordinary course of trade of the like products subject to investigation and data regarding the costs attributable to CMI and without following any of the 
methods mandated under Article 2.2.2 of th e AD Agreement is inconsistent with 
Article 2.2, Article 2.2.1.1, and Article 2.2.2 of the AD Agreement. 
  24. Korea's resort to best information ava ilable in order to construct administrative, 
selling and general costs of PT Pindo Deli a nd PT Indah Kiat is inconsistent with 
Article 6.8 and paragraphs 3, 5, 6 a nd 7 of Annex II of the AD Agreement. 
 
 25. Korea failed to provide in sufficient detail findings and conclusions reached on the 
determination of normal value.  In particul ar, Korea failed to provide details of the 
amounts for, and methods and evidence used in determining, cost of production, 
administrative, selling and general costs, financial expenses and profits.  This is 
inconsistent with Article 12.2 of the AD Agreement.  
 
 26. Korea's determination of normal value for PT Tjiwi Kimia is inconsistent with  
Article 2.1, and Article 6.8,  paragra phs 3, 5, 6 and 7 of Annex II of the 
AD Agreement.  
 
 27. Korea's failure to make a fair co mparison between the export price and the 
constructed normal value in respect of PT Pindo Deli, PT Indah Kiat and Tjiwi 
Kimia, inter alia , by failing to take into account that domestic sales were made 
through an intermediary – CMI - while expor t sales were made directly to consumers 
and by failing to make a fair comparison at the same level of trade is contrary to  WT/DS312/2 
 Page 5 
 
 
Article VI:1 and Article VI:2 of GATT and Article 2.1 and Article 2.4 of the 
AD Agreement.  
  28. Korea's incorrect classification of im ports from PT Indah Kiat as dumped imports as a 
result of treating PT Indah Kiat, PT Pindo Deli and PT Tjiwi Kimia as a single 
economic unit, as well as Korea's incorrect classification of all imports from 
Indonesia and China, including imports that occurred outside the period of investigation for dumping, as dumped imports and the consequent incorrect determination of injury and causal link between the alleged dumped imports and 
injury is inconsistent with Article 3.1, Article 3.2, Article 3.4, Article 3.5 and 
Article 3.7 of the AD Agreement, and Ar ticle VI:1 and Article VI:6 of GATT. 
  29. As a result of the incorrect characte rization of business information paper and 
uncoated wood-free paper as like products, Korea's incorrect assessment of the 
impact of the dumped imports on the domestic  industry is inconsistent with  Article 
3.1, Article 3.4, Article 3.5 and Article 3. 7 of the AD Agreement, and Article VI:1 
and Article VI:6 of GATT. 
  30. Korea's failure to adequately evaluate the effect of the dumped imports on prices in 
the domestic market for like products is inc onsistent with Article 3.1, Article 3.2, 
Article 3.5 and Article 3.7 of the AD Agreemen t, and Article VI:1 and Article VI:6 of 
GATT. 
  31. Korea's failure to evaluate all releva nt economic factors and indices having a bearing 
on the state of the domestic industry is contrary  to Article 3.1, Article 3.4, Article 3.5 
and Article 3.7 of the AD Agreement, and Article VI:1 and Article VI:6 of GATT. 
 
 32. Korea's failure to objectively examine the participation of the domestic industry in the 
importation of the allegedly dumped imports and Korea's erroneous attribution of the 
injury that occurred in the first half of 2003 to dumped imports that entered the Korean market 3-15 months earlier is incons istent with the requirements set out in 
Article 3.1, Article 3.2, Article 3.4, Article  3.5, and Article 3.7 of the AD Agreement, 
and Article VI:1 and Article VI:6 of GATT.  
  33. In relation to further information pr ovided by the domestic industry concerning the 
domestic industry's performance up to first half of 2003, Korea's denial of access to such information by not making it available to  the other interested parties in a timely 
manner or by not allowing other interested parties to see it is inconsistent with 
Article 6.1.2 and Article 6.4 and Article 6. 9 of the AD Agreement.  Furthermore, 
Korea's failure to inform the Indonesian exporters of the essential facts relating to 
injury before the final determination was made  is inconsistent with Article 6.9 of the 
AD Agreement. 
 
 In Indonesia's view, the foregoing cannot be reconciled with Article VI of the GATT, 
Article 1 of the AD Agreement, and the specific provisions cited above.  Therefore, pursuant to 
Articles 4.7 and 6 of the DSU, Article XXIII:2 of  the GATT, and Articles 17.4 and 17.5 of the 
AD Agreement, Indonesia hereby requests the Dis pute Settlement Body to establish a panel to 
examine the matter described above. 
 
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