RESTRICTEDWORLD TRADE
ORGANIZATIONG/ADP/AHG/W/43
16 April 1998
(98-1526)
Committee on Anti-Dumping Practices
Ad Hoc Group on Implementation
COMPILATION OF INFORMATION PROVIDED BY
MEMBERS REGARDING LESSER DUTY RULE
Note by the Secretariat
As requested by the Ad Hoc Group on Implementation at its October 1997 meeting, this
document compiles information submitted by Members in response to WTO/AIR/643 regarding lesser
duty rule.
_______________
Exerpted from: Page
Document G/ADP/AHG/ W/8 (Hungary).............................................................................. 2
Document G/ADP/AHG/W/ 10 (New Zealand) .................................................................... 2
Document G/ADP/AHG/W/ 12 (Venezuela)......................................................................... 3
Document G/ADP/AHG/ W/14 (Turkey).............................................................................. 4
Document G/ADP/AHG/ W/15 (Mexico) ............................................................................. 5
Document G/ADP/AHG/ W/17 (Korea)................................................................................ 7
Document G/ADP/AHG/ W/19 (Brazil)................................................................................ 7
Document G/ADP/AHG/W/21 (E uropean Community) ...................................................... 7
Document G/ADP/AHG/ W/23 (Japan) ................................................................................ 8
Document G/ADP/AHG/ W/24 (Israel)................................................................................. 8
Document G/ADP/AHG/ W/25 (Thailand) ........................................................................... 8
Document G/ADP/AHG/W/ 29 (Australia)........................................................................... 9
Document G/ADP/AHG/ W/31 (Canada).............................................................................. 12
Document G/ADP/AHG/ W/34 (Colombia).......................................................................... 12
Document G/ADP/AHG/ W/35 (Turkey).............................................................................. 13
Document G/ADP/AHG/W/41 (United States) .................................................................... 14G/ADP/AHG/W/43
Page 2
Document G/ADP/AHG/W/8 (Hungary)
(C) A description of how the lesser duty rule is applied.
Having had no investigation, the rule was not applied in practice.
Document G/ADP/AHG/W/10 (New Zealand)
(C) A description of how the lesser duty rule is applied by New Zealand
New Zealand submits the following description of how the lesser duty rule is applied in
practice by its investigating authorities.
Basis for Lesser Duty
The New Zealand approach to the application of the lesser duty rule is defined by section
14(5) of the Dumping and Countervailing Duties Act 1988, which provides:
In exercising the discretion under subsection(4) of this section, the Minister
shall have regard to the desirability of ensuring that the amount of anti-dumping or
countervailing duty in respect of those goods is not greater than is necessary to
prevent the material injury or a recurrence of the material injury or to remove the
threat of material injury to an industry or  the material retardation to the establishment
of an industry, as the case may require.
The purpose of a lesser duty, and hence a non-injurious price, is to determine whether a duty
less than the margin of dumping is sufficient to remove the material injury or prevent the recurrenceof material injury caused by the dumping.  This requires an assessment of the extent of injury
attributable to the dumping.  In this context, it should be noted that the New Zealand authorities
consider that injury is material if it is more than immaterial and if the industry is worse off, i.e. if, as a
result of the dumping and the volume and price effe cts attributable to the dumping, there are adverse
economic consequences for the industry, in terms of an actual or potential decline, or other adverseeffects, in the injury factors and indices identified in Article 3 of the Agreement.
Removal of Injury
In determining whether or not the lesser duty rule should be applied, the first step is to
ascertain the situation which would apply in the absence of the dumping of the goods and the injuryattributable to the dumping.
The main impact of dumping is indicated through price effects and the consequent impact on
sales and profits.  Accordingly, initial indications of the extent of injury attributable to dumping can
be established through (a) the margin of price undercutting, or (b) the level at which the industry’s
prices are non-injurious.
If the margin of price undercutting exceeds the level of undercutting that would be present if
the goods were not dumped, then this provides prima facie  evidence that a lesser duty would not be
appropriate.  However, if the margin of price undercutting is less than the margin of dumping, then
further consideration must be given to the application of the lesser duty rule.G/ADP/AHG/W/43
Page 3
The second approach is to establish a non-injurious price, being the price that would apply in the
absence of the injurious dumping. Ideally, such a price should be based on market considerations,
such as the prices which prevailed before dumping affected the market. Where such an approach may
not be appropriate then alternative approaches could be used, such as constructing a price on the basis
of current costs and pre-dumping profit rates, or the current profit rates obtained by industries
producing goods in the same general category.
The level of profitability is generally used as a normative indicator of injury, since that is
considered the most useful indicator of the health of an industry, and is the factor which combines theeconomic impact of price and volume effects of the dumped or subsidised imports, and the industry’s
reaction to them.
Establishing the Level of Duty
Having established the non-injurious market price, the equivalent dutiable value for the goods
is established.  This will normally involve deducting from the non-injurious market price those cost
elements between the dutiable value (usually FOB) and the market level.  The relevant market level is
taken as the first point of competition in the New Zealand market, i.e. ex-factory for domestic
producers, and ex-importer’s store for imported goods, which is similar to that normally used for the
price undercutting comparison.  The cost elements in the formula to calculate the dutiable value will
normally include freight costs, importation costs and fees, including transport from wharf toimporter’s store, normal duty, any other costs associated with importation but not with distribution,
and a margin for the importer.
The approach used does not seek to make judgements about what different businesses regard
as an appropriate level of profit or any price or profit “entitlement” beyond the factually determined
price or profit level achieved before the impact of dumping, or on another reasonable and appropriate
basis.
Where prices or profit levels applying before the dumping occurred are used, they will
normally be appropriate only when the pre-dumping situation is fairly recent.  In the case of a review,
or where there has been a significant period of time between the pre-dumping situation and the time of
the investigation or review, an alternative approach may be required to determine the appropriate level
of a non-injurious price.
Application of Lesser Duty Rule
New Zealand has applied the lesser duty rule in only four cases, three of which involved
closely related products from the same country.  This reflects the fact that in most cases the economic
position of the industry will be only partly ameliorated by the removal of the dumping.
Document G/ADP/AHG/W/12 (Venezuela)
3. Description of how the lesser duty rule is applied by the Member
The provision enabling the competent authorities to impose an anti-dumping or countervailing
duty that is less than the margin of dumping dete rmined or the amount of the subsidy, when such
lesser duty would be adequate to remove the injury to the domestic industry producing like goods
("lesser duty rule"), is established in Article 16 of  the Venezuelan anti-dumping legislation as follows:G/ADP/AHG/W/43
Page 4
"The anti-dumping or countervailing duties to be imposed shall under no
circumstances exceed the margin of dumping or the amount of the subsidies
respectively.  Anti-dumping or countervailing duties may be less than the
aforementioned limits when the Commission considers that they are sufficient to
remove the injury or threat of injury."
In the various investigations in which anti-dumping duties less than the margin of dumping
determined have been imposed, the Commission has considered that the fundamental purpose of this
lesser duty rule is to encourage competition between the imported goods subject to definitive duties
and the injured domestic product.
The ability to impose a lesser duty is directly linked to the injury suffered by the domestic
producer, since a lesser duty may be imposed provided it is sufficient to remove the injury.  The
question therefore arises as to what would be the applicable lesser duty which would remove the
injury incurred.  The reply lies in the margin or amount of injury suffered by the domestic producer.
Despite the guidelines laid down in the Agreements and developed by Member countries,
injury is a difficult element to quantify.  In any event some countries have developed methodologies
to determine the amount of injury through a price comparison between the investigated import and the
injured domestic product.  These methodologies were used by the CASS in one of its investigations,
in which it determined that the application of a le sser duty was sufficient to remove the injury caused
to the domestic industry producing like goods.
The case in question where a lesser duty was established was the anti-dumping investigation
into imports of crystal and high-impact polystyrene originating in the United States.  Here, although a
dumping margin of 15.61 per cent was determined for crystal polystyrene and 25 per cent for high
impact polystyrene, a definitive ad valorem  duty of 9 per cent was established on the basis that this
was sufficient to remove the injury suffered by the domestic industry producing like goods.
In order to establish the applicable lesser duty in this case, the Commission had to determine
the price at which the imported good should enter to enable the like domestic good to compete fairly
and at the same time cover costs, expenses and profits.  Consequently, the lesser duty applied was the
result of the difference between the above-mentione d prices, so that the full margin of protection
would not be granted, thus ensuring that the duty was not more import-restrictive and encouraging
competition between the imported goods subject to definitive duties and the injured domestic product.
Another case where a duty was imposed that was less than the margin of dumping determined
was in the investigation on imports of blue jeans orig inating in China.  In this case the application of
the lesser duty was basically justified by practical reasons:  as the investigation concerned products ofidentical nature and similar use (women's blue jeans and men's blue jeans), and although the amount
of the applicable definitive duties differed between the two products, it was considered more practical
to impose a single anti-dumping duty for both products, in the form of the applicable lesser duty.
Document G/ADP/AHG/W/14 (Turkey)
(C) Application of lesser duty rule
In Article 1 of the A-D Agreement, it is stated that an anti-dumping measure shall be applied
only under the circumstances set forth in Article VI of the GATT 1994 and pursuant to investigationsinitiated and conducted in accordance with the provisions of the Agreement.G/ADP/AHG/W/43
Page 5
In addition to this, in Article 9 of the Anti-Dumping Agreement the decision whether or not to
impose an anti-dumping duty in cases where all requirements for the imposition have been fulfilled, is
left to the investigating authorities.  Besides, the amount of the anti-dumping duty to be imposed,
provided that it is not higher than the margin of  dumping, is at the discretion of the investigating
authorities.
In Article 9.1 of the A-D Agreement it is stated that the anti-dumping duty is desirable to be
less than the margin of dumping if such lesser  duty would be adequate to remove the injury.
Application of lesser duty should be the rule because:
- the spirit of the A-D Agreement requires this.  The aim of imposing anti-dumping
duty is to remove the injury, not the dumping since, in cases where goods are sold at
dumped prices but have not caused injury then no measures can be imposed.
- a higher duty than the amount necessary to remove the injury may lead to
inefficiencies in the allocation of resources.
Turkey's current legislation governing procedures for anti-dumping investigations has
provisions concerning this subject.  In Article 7 of the Law on the Prevention of Unfair Competition
in Importation it is stated that "... in case it is determined that the injury occurring on account of
dumped and/or subsidized importation may be compensated by the imposition of a duty at a lesser
quantity or rate than the established dumping margin or subsidy amount, a duty on such rate orquantity shall be applied".
In Turkish experience lesser duty rule is applied.
Document G/ADP/AHG/W/15 (Mexico )
II. COMMENTS ON THE APPLICATION OF THE LESSER DUTY RULE
While the explanation that follows does not in any way represent Mexico's practice with
respect to this matter, it does provide general guidelines which Mexico considers to be of interest in
trying to arrive at a common stance.
There are various ways of applying a duty which is less than the margin of dumping (lesser
duty rule), including:
- The unitary international price approach or the exogenous price method;- the endogenous production cost or price approach.
A. Unitary international price approach or exogenous price method
This approach entails establishing a relation between the dumped export price and the price of
the domestic product, and between these prices and an undistorted international price, i.e. the price
that would be taken as a reference for situating prices on the domestic market if it were not distortedby dumping.  There are a few parameters and basic rules that can be applied in this respect.
The key to this approach is to establish an undistorted international price, which is the price
that should theoretically apply to all domestic products and imports competing on the same market in
the absence of distortions caused by dumping.  In fact, this price may be considered as the "targetG/ADP/AHG/W/43
Page 6
price" for domestic producers, and the exogenous price method is one of the two ways of establishing
it, the other being the domestic-industry-based method.
Provided sufficient information is available, the target price for the domestic industry should
preferably be the price obtained by the exogenous method, i.e. on the basis of an undistorted
international price.  Theoretically, as long as there is no dumping, the domestic industry prices in an
open economy would be the undistorted prices of the closest real or potential international competitor,which are not necessarily the same as the normal value in the exporting country under investigation.
Under this approach, when it is determined th at the undistorted international price is the same
as the normal value, the duty should be equal to the margin of dumping.  If, on the contrary, the
undistorted international price is identical to the e xport price, then the dumping does not cause injury
and an anti-dumping duty is unnecessary.
Thus, a duty lower than the margin of dumping determined may only be applied when the
undistorted international price is between the normal value and the export price, in which case a dutymust be imposed that is enough to set the dumped export price at the international price.  This was the
case for sodium tripolyphosphate imports from Spain, where the Mexican investigating authority
applied the lesser duty rule on the basis of an international reference price.
As regards manufactured goods for which there are no reliable international references, the
international price can be estimated on the basis of the average export price of like goods fromcompanies or countries that do not engage in dumping  or are not involved in the investigation.  Thus,
for example, in the investigation on hydrogen peroxide imports from the United States, the Mexican
investigating authority applied the lesser duty rule on the basis of the price of imports from a United
States company that did not engage in dumping.
B. Endogenous production cost or price approach
When there is no information, or the informati on available is insufficient to consider an
undistorted international price as the target price for the domestic industry, the endogenous approach
may be adopted.  This approach consists in setting a target price on the basis of the actual information
obtained from the domestic industry, in particular with respect to costs and profits of domestic
producers, or on the basis of domestic prices prior to the unfair competition. The said informationwould be used to try to determine a price level that would ensure that domestic producers earned
reasonable profits.
As with the first approach, the different prices obtained through the investigation are
compared with a target price.  If the target price is the same as the normal value, the duty will be equal
to the dumping margin determined.  On the other hand, if the target price is the same as the exportprice of the exporter under investigation, the said export price is not the cause of the injury, and no
duty is applied.  Finally, if the target price is found to be between the normal value and the export
price, a duty must be imposed that is enough to set the dumped export price at the target price.
This approach was applied by the investigating authority in Mexico in the cases of imports of
connectors for telephone-wire joints from the United States and imports of sulphuric acid from Japan.
In the first case, the lesser duty rule was applied on the basis of the existing domestic production
prices prior to the market distortion caused by the dumping.  In the second case, the lesser duty rulewas applied on the basis of the average weighted production cost of two non-complainant domestic
manufacturers.G/ADP/AHG/W/43
Page 7
Document G/ADP/AHG/W/17 (Korea )
(C) Lesser duty practices in Korea
In light of paragraph 1, Article 10 of the Korean Customs Act, Korea makes it a practice to
impose the duty less than the margin, if such lesser duty would be adequate to remove the injury to
the domestic industry.  Korea has applied the lesser duty rule in many cases, such as polyacetal resin
from the United States, presensitized printing plate from Japan, E-glass fibre from Chinese Taipei,disodium carbonate from Russia and Bulgaria, and H-beam from Russia.
Document G/ADP/AHG/W/19 (Brazil)
3. Lesser duty rule
In the case of imposition of anti-dumping duties less than the margin of dumping, the
Brazilian authorities are of the view that the prices of the like product in the domestic market of the
importing country and the prices of the imported product, adjusted to the same level of trade, must be
taken into account.
Prices in the domestic market to be taken into consideration are, in principle, those in effect
during the period of investigation of the existence of dumping.  Nevertheless, if it is observed that
there has been a depression or suppression of these prices, as a result of the unfair competition, the
investigative authorities may consider the prices that should have been practised by the domestic
industry under normal conditions of trade.
Import prices are those effectively practised in the transaction, plus the costs of import in the
import country.
Document G/ADP/AHG/W/21 (European Community)
The Lesser Duty Rule in Anti-Dumping Proceedings
1. Legislative provisions and principles
The Community’s Basic Regulation provides (in Articles 7, 8 and 9) that when imposing
provisional or definitive measures, or accepting voluntary undertakings, the amount of duty (or level
of price increase in an undertaking) shall not exceed the margin of dumping, but should be less than
the margin if such lesser duty would be adequate to  remove the injury to the Community industry.
2. In practice the injury margin has proved to be lower than the dumping margin in
approximately half of all cases, and on balance has resulted in the halving of the duty level - the
importance of the rule in moderating the level of duties applied is therefore substantial.
3. A key aspect of the Community’s application of the lesser duty rule is that it must be used
systematically, in order to remove any possibility of selective application of the rule, which would
open the way for discriminatory treatment.G/ADP/AHG/W/43
Page 8
4. Outline of process followed
In order to establish whether a duty less than the dumping margin is appropriate, the
Commission calculates an injury margin, a duty equal to which is applied if it is below the dumping
margin.  The main features of the method most commonly used in the past are as follows:
-  a "non-injurious price" is assigned to the Community industry, established by adding
a reasonable amount of profit for the sector concerned to the normal weightedaverage cost of production for the industry;
-  the difference between this non-injurious price and the average price of the dumped
imports is known as the underselling margin - it is this which is normally used as the
injury margin;
-  this injury/underselling margin represents the level of price increase which should
remove injury from the Community industry - it is therefore deemed excessive to set
the duty at a rate higher than this amount.
Document G/ADP/AHG/W/23 (Japan)
3. Lesser Duty Rule
Under Japanese law, the provision related to this issue is Article 8.1 of the Customs Tariff
Law.  It prescribes an anti-dumping duty in an  amount equivalent to or less than the difference
between the normal price and the price of the dumped product.
In the past cases, Japan imposed anti-dumping duties in an amount equivalent to the
difference between the normal price and the price of the dumped product.
Document G/ADP/AHG/W/24 (Israel)
C. The Following is a Description of How the Lesser Duty Rule is Applied by the Authorities
The lesser duty rule when applied by the authorities means that the anti-dumping duty shall
not exceed the margin of dumping and should be less if such lesser amount would be sufficient to
remove the injury caused to the domestic industry.
It must be stated that the particular applications of the lesser duty rule very much depends on
the particular circumstances of each case.  There exist several precedents applying varying
methodologies in determining what the non-injurious price level of the domestic industry may be.  Inone case the recommended duty was applied at the rate of the price undercutting between the export
price and the price of the domestic industry.  In another case, the recommended duty was determined
by the rate of the difference between the export price and the "target price" for the domestic industry
which was set at a level which would cover their costs of production and profit.
Document G/ADP/AHG/W/25 (Thailand)
2. Lesser Duty RulesG/ADP/AHG/W/43
Page 9
Though, the concept of "Lesser Duty Rules" is not explicit in the Ministerial Notification, in
practice, Rules 5.1 and 14.1 of the Ministerial Notification provide for the authority to apply duty
lesser than the dumping margin sufficient to eliminate the injury by considering the interest of
domestic industries, consumers and public benefit in determining the anti-dumping rate.
Document G/ADP/AHG/W/29 (Australia)
NON INJURIOUS PRICE CALCULATION - THE LESSER DUTY RULE
Introduction
The difference between the normal value and export price (or the amount of countervailable
subsidy) sets the maximum amount of duty payable.
Article 9.1 of the WTO Anti-Dumping Agreement not es that it is desirable that anti-dumping
duty be  less than the dumping margin if such lesser dut y would be adequate to remove the injury to
the domestic industry.  Article 19.2 of the Agreement on Subsidies and Countervailing Measures
mirrors this provision in relation to countervailing duty.
Australian Legislation
In accordance with ss. 8(5A), 8(5B), 9(5A) 10(3C), 10(3D), and 11(5) of the Customs Tariff
(Anti-Dumping Act) 1975  (see pages 93-101 of G/ADP/N/1/AUS/1), the Minister must have regard to
the desirability of fixing a lesser amount of duty such that the sum of the export price and the lesser
amount of duty does not exceed the non-injurious price.  In other words, a price sufficient to remove
the injury caused by the dumping and/or countervailing.
Section  269TACA of the Customs Act 1901  defines the non-injurious price as the " minimum
price necessary ... to prevent the injury ... ", but does not give a method for calculating this price.
Practice
The usual method for determining a non-injuriou s price (NIP) is, first, to determine an
"unsuppressed selling price" (USP) for the goods in Australia.  In assessing the USP, customs
preference is to examine the market for prices of the locally produced goods at a time when the
market was not affected by dumping or subsidization.
The market may not always, however, allow a reliable measure of the USP.  The prevailing
market price may not be a reliable measure because it is affected by dumping.  Further, if dumping
has been occurring for some time then it may not be possible to use a price before the dumping
occurred as the price is dated and no longer relevant.  The industry may have undergone significant
structural changes since the time it was unaffected by dumping or subsidization.
In such circumstances it may be necessary to calculate the USP from the local producer's
current cost to make and sell, plus an estimate of the profit (if any).  Profit on sales by closely relatedindustries may be examined using published profit surveys (e.g. from stock exchange information,
business publications or the Australian Bureau of St atistics);  or the industry may provide details of
the margin on sales they normally would have achie ved in the absence of dumping or subsidization.
Where it is apparent that the industry would be selling at a loss (even in the absence of dumped or
subsidized goods in the marketplace) a "nil" profit will be allocated.G/ADP/AHG/W/43
Page 10
Once the USP has been determined, all relevant costs which would be incurred by an importer
are deducted to arrive at a Free-On-Board (f.o.b.) price.  The NIP is normally calculated in f.o.b.
terms for the country of export as the majority of anti-dumping and countervailing duties are based on
f.o.b. prices.  (It is however possible for the NIP to be set at an ex-factory level.)
Deductions are made using information relating to the most efficient representative importer
(i.e. usually the importer with the lowest on-costs, at the chosen level of customer).  Deductions willinclude all costs incurred in getting the goods from the export f.o.b. point (or another point if
appropriate) to the chosen level of customer in Australia, including all into-store costs and duties.
These costs are usually identified during verification visits to importers in the ordinary course of an
investigation.  An example of the calculati on of a NIP derived from a USP is shown below:G/ADP/AHG/W/43
Page 11
EXAMPLE OF NON-INJURIOUS PRICE CALCULATION
$A/unit
USP (market or costs based) 1.200
Less Profit (if any) 0.150
Less AS&G expenses 0.175
Less packaging costs 0.0891
Less into store costs 0.005
Less o/s freight & insurance 0.064
Duty inclusive price 0.717
Less duty at 10% 0.0652
NIP (N)
0.652
NIP per dozen 7.824
$US per dozen ($1A=$US0.7858) 6.148
1An example of where an importer engages in a value-added activity;  in this case packaging.
2Duty may be calculated as follows:
if X = the duty inclusive price (0.717)
Y = the duty rate expressed as a decimal (0.10)N = NIP
N+(YxN) = X , then X    = 0.717
=0.652
1+Y   1.10
So, duty $ = (X-N)
= 0.717-0.652= 0.065
OR,
N = X     therefore duty amount = Yx X   
 =0.10 x0.717  =0.065
1+Y 1+Y 1.10
Alternatively, if the duty rate were to be expressed as a percentage then the duty amount
= Y    xX,(i.e. 10  x0.717=0.065)
100+ Y 110G/ADP/AHG/W/43
Page 12
The deductions shown are examples only;  there may be other deductions required e.g. for
sales tax.  Costs of importation are usually obtained from actual costs incurred by the importer,
although in some cases costs may be calculated e.g. profit or AS&G expenses could be based on a
percentage of the USP.
All NIPs are expressed in Australian dollars.  Any costs incurred in another currency are
converted to Australian dollars at the rate of exchange applying on the date that the charge was levied.In calculating the USP and the NIP, a cash price basis will be used.  If export sales to Australia are for
more than 30 day terms, then an amount for credit terms will be added on to the cash NIP.
The actual duty rate applicable to the goods when entered for home consumption in Australia
is the rate used in calculating the NIP.  It is possible that there may be two separate NIPs for the one
country, one for goods which are eligible for, and attract the preferential duty rate (for developing
countries), the other for goods at the general rate.
The Duty Payable
The calculated NIP is compared to the ascertained normal value to determine which is lower.
Where the NIP is lower, the interim dumping duty payable is the difference between the ascertained
export price and the ascertained NIP.
Document G/ADP/AHG/W/31 (Canada)
C. LESSER DUTY
Canada does not have a lesser duty rule.  It does, however, have a public interest provision
which may allow for the application of anti-dumping duties below the full margin of dumping if such
a duty is determined to be in the public interest.
Document G/ADP/AHG/W/34 (Colombia)
(c) How the lesser duty rule is applied in anti-dumping investigations in Colombia
Until now, Colombia has not applied the dumping margin as duty.  For the purposes of
determining the anti-dumping duty, a comparison is  made between the price of the imported product
and that of the domestic product.
The following procedure is usually followed:
1. If a comparison of the weighted average price of domestic producers compared with
that of imports, under the same physical conditions and at the same levels of trade,
shows that the price of the imported product is lower than that of the domestic
producer:
1.1 The average weighted price of domestic producers is calculated, dividing the
total value of net sales by the corresponding volume of such sales for themost recent period of time for which information is available;
1.2 A calculation is made of the costs borne by an importer for placing his
product in the same conditions of sale as domestic producers;G/ADP/AHG/W/43
Page 13
1.3 The figure arrived at under 1.2 is subtracted from the figure under 1.1, giving
a price at which a hypothetical import would be declared in order to be sold
on the domestic market at a price very similar to that at which domestic
producers sell identical or like products;
1.4 This price is then fixed as the minimum price at which importers may declare
their goods.  If imports are declared at a price lower than this minimum price,the Directorate of Taxes and National Customs (DIAN) collects the
difference between the two prices, but this duty must not exceed the absolute
margin of dumping identified during the investigation.
2. If it is shown that the low price of imports has caused the domestic producers' price
to fall below these minimum import prices, the nominal price that would have
prevailed if the price trend noted in preceding periods had continued is applied.
This estimated price is calculated in the way explained in subparagraphs 1.3 and 1.4
above.
Document G/ADP/AHG/W/35 (Turkey)
Topic 10 - Duty Assessments
As already stated in our previous paper (G/ADP/AHG/W/14),
"In addition to this, in Article 9 of the Anti-Dumping Agreement the decision
whether or not to impose an anti-dumping duty in cases where all requirements for
the imposition have been fulfilled, is left to the investigating authorities.  Besides, the
amount of the anti-dumping duty to be imposed, provided that it is not higher than the
margin of dumping, is at the discretion of the investigating authorities.
In Article 9.1 of the A-D Agreement it is stated that the anti-dumping duty is desirable to be
less than the margin of dumping if such lesser  duty would be adequate to remove the injury.
Application of lesser duty should be the rule because:
- the spirit of the A-D Agreement requires this.  The aim of imposing anti-dumping
duty is to remove the injury, not the dumping since, in cases where goods are sold at
dumped prices but have not caused injury then no measures can be imposed.
- a higher duty than the amount necessary to remove the injury may lead to
inefficiencies in the allocation of resources.
Turkey's current legislation governing procedures for anti-dumping investigations has
provisions concerning this subject.  In Article 7 of the Law on the Prevention of Unfair Competition
in Importation it is stated that '... in case it is  determined that the injury occurring on account of
dumped and/or subsidized importation may be compensated by the imposition of a duty at a lesser
quantity or rate than the established dumping margin or subsidy amount, a duty on such rate or
quantity shall be applied'."
(i) Turkey applies the lesser duty rule.  After a dumping margin is calculated, a non-
injurious price, at which perfect competition can be met in the market of the relevantG/ADP/AHG/W/43
Page 14
product, is established.  Then, the difference between non-injurious price and cost of
importation is used as duty.
(ii) Turkey assesses the amount of anti-dumping duty on a prospective basis.  Definitive
anti-dumping duty is collected at the time of importation.
Document G/ADP/AHG/W/41 (United States)
Lesser Duty Rule
The United States does not apply the lesser duty rule.  However, we are interested to learn
more about how the lesser duty rule is utilized by other Members.  For example, do Members which
have a lesser duty rule apply it in all anti-dumping proceedings?  If not, why not?  When Members
apply the rule, is it always applied at both the preliminary and final phases of the proceeding?  How
do interested parties know that a Member is examining whether a lesser duty should be applied?  If a
provisional determination is taken which contains no indication that an examination was conducted as
to whether to apply a lesser duty at the preliminary phase (whether or not the examination actuallywas undertaken), how would interested parties know  (1) that the Member was intending to examine
whether to apply a lesser duty at the final phase and (2) whether the Member is also intending to leave
the provisional measures in place for more than four months pursuant to Article 7.4 of the Anti-
Dumping Agreement and, if so, for how long, i.e. five months? the maximum allowed time of six
months?  Do the final determinations of Members which apply the lesser duty rule contain a decisionwhether the amount of the anti-dumping duty to be imposed shall be the full margin of dumping or
less?
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