G/ADP/Q1/PER/32  
G/SCM/Q1/PER/32  
29 April 2021 
(21-3652) Page: 1/3 
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 QUESTIONS1 POSED BY THE UNITED STATES REGARDING  
THE NOTIFICATION OF PERU2 
The following communication, dated and received on 28 April 2021, is being circulated at the request 
of the delegation of Peru. 
 
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Peru thanks the United States for its questions with regard to Peru's notification of Law No.  31089 
"Law comb atting the circumvention of anti -dumping and countervailing measures".  
Question 1  
Article 4, Paragraph (c) states that circumvention includes "the importation of a product 
subject to duties with minor modifications or alterations that do not imply a change in the 
essential character of the product ." Please describe  how the investigating authority 
determines wh at constitutes "minor modification s or alteration s that do not impl y a 
change in the essential character of a product ". 
Reply : 
The importation of products with minor modifications or alterations constitutes one of the most 
frequent forms of circumvention and occurs when an economic agent introduces minor modifications 
in the product subject to anti -dumping or countervailing duties, or  alters it slightly, to make it appear 
that it is a product different from the product subject to measures and, in this way, avoid paying 
duties . The changes made to the product do not have to be significant and do not alter its 
fundamental characteristics . For instance, if the product that is subject to anti -dumping or 
countervailing duties is of a specific width of five (5) inches, a minor modification that does not imply 
a change in the essential character of the product, would be if the imported product  has 5.1 inches 
of width . This criterion will be further developed in the regulation of Law Nº 31089.  
Question 2 
Article 4, Paragraph (d) lists "reorganization of sales channels " as an indicative criterion 
of circumvention . Please elaborate on what is meant by a "reorganization " and the basis 
for determining whether there exists a reorganization.  
Reply : 
As a result of an antidumping or countervailing duties determination, certain exporters may be 
benefited from lower individual duty rates, as the dumping margin or the subsidy of the product 
object of investigation of such exporter is found to be lower in comparison with the rest of the 
exporters investigated . Therefore, the reorgan ization of sales channels of the product subject to 
 
1 G/ADP/Q1/PER/30 – G/SCM/Q1/PER/30.  
2 G/ADP/N/1/PER/2/Suppl.2 - G/SCM/N/1/PER/2/Suppl.2.  G/ADP/Q1/PER/32 • G/SCM/Q1/PER/32  
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  antidumping or countervailing duties would become an indicative criterion of circumvention when 
the trade flow of that product is reorganized and is exported with lower duties rates increases its 
share of  the market . Further criteria will be developed in the regulation of Law Nº 31089.  
Question 3  
Article 4, Paragraph (f) states that circumvention includes "any other conduct the purpose 
of which is to avoid payment of an anti -dumping or countervailing duty ." The next 
paragraph lists three criteria that "must be verified ". Are those criteria used to determine 
whether, under Paragraph (f), the purpose is to avoid payment of an anti -dumping or 
countervailing duty ? If not, what is the standar d to determine purpose?  
Does the "purpose [] to avoid payment " requirement also apply to the "main forms of 
circumvention " listed in Paragraphs (a) -(e)? Please explain whether the investigating 
authority must separately determine whether there is intent to  evade duties when one of 
the listed circumvention practices is found to exist , or if the other forms of circumvention 
listed in Article 4 are deemed sufficient to demonstrate intent without further evidence . 
If the investigating authority is required to m ake an affirmative finding with regard to 
intent to evade an existing anti -dumping or countervailing duty measure, please explain 
the criteria by which the investigating authority makes this determination.  
Reply : 
Article 4 establishes the "main forms of ci rcumvention" listed in Paragraphs (a) -(e), while Article 5 
disposes of all the information and evidence that must be provided in a circumvention review 
application.  
Article 4 (f) includes a general circumvention clause (different from those listed above) . The 
elements indicated in the final paragraph of Article 4 will make it possible to identify the essential 
elements that make up the practice of circumvention (among them, the purpose of circumventing) 
and, therefore, differentiate it from legitima te international trade operations . The inclusion of a 
general clause is justified by the fact that circumvention can manifest itself in elusive practices that 
are not always possible to foresee in the law . Further criteria will be developed in the regulati on of 
Law Nº 31089.  
Question 4 
Article 4, Paragraph (f)(ii) seems to state that there may be instances where there exists 
an "economic justification " for avoiding the payment of duties . Please elaborate on the 
meaning of this provision and how the Investig ating Authority will determine "economic 
justification ", and provide an example.  
Reply : 
It will be necessary to verify if the commercial change is driven by practice or process that is not 
economically justified reasonably . The foreign exporting companies or national importers can 
support and prove that the change in trade flows is due to economic or market reasons, other than 
avoiding the payment of duties . This criterion will be further developed in the regulation of 
Law Nº 31089.  
Question 5 
Article 5, Paragraphs (c) and (d) of Peru 's circumvention law states that requests to 
initiate a circumvention review must contain, among other things, "evidence that the 
practice reported has negative repercussions on the remedial effects of the duties in te rms 
of the prices and quantities of the imported product subject to measures " and "evidence, 
in the case of alleged circumvention of anti -dumping duties, that the product is exported 
to Peru at prices lower than the normal value established in the original  investigation or 
the previous review of the duties circumvented ." Please explain the relevance of the 
requirement that the investigated product be at prices lower than the established normal 
value to the outcome of the circumvention investigation . In othe r words , why is it G/ADP/Q1/PER/32 • G/SCM/Q1/PER/32  
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  necessary of established a lower level of prices in order to initiate a circumvention review ? 
In addition, please clarify whether Peru  intend s to adjust the "previously established 
normal value " (as noted in Article 5, paragraph (d)) for factors which could affect the 
market price of the investigated product ( e.g., inflation, changes in the prices of raw 
material inputs and fluctuations in world prices)?  
Reply : 
To the extent that the products at d umped prices can cause damage to the national industry, in 
those cases in which the existence of practices of circumvention of anti -dumping duties is alleged, 
it must be proven that the products object of investigation is entering the national territory at  
dumped prices (that is, at prices lower than the normal value) . Otherwise, the application of the 
existing duties could be extended to products that do not enter the national territory at dumped 
prices and that, therefore, do not cause injury to the domestic industry.  
Article 5, paragraph d) establishes that the normal value established in the original investigation or 
the previous review of the duties circumvented shall be considered . Further criteria will be developed 
in the regulation of Law Nº 310 89. 
Question 6 
Article 8, Paragraph (b) states that interested parties have 15 calendar days to submit 
their comments on the Essential Facts forming the basis for its final decision in a 
circumvention review . Are there any other opportunities for intereste d parties to express 
their views in the circumvention proceeding ? If so, please explain each opportunity in 
detail . For example, can an interested party submit written evidence and comments on 
the application for the circumvention review ? Will interested p arties be made aware of 
the existence of a circumvention application prior to initiation  of a circumvention inquiry ? 
Are there continuous and on -going opportunities throughout the circumvention review for 
interested parties to express their views and submit written evidence?  
Reply : 
The circumvention review is an administrative proceeding under Peruvian laws and regulations . 
Hence, once the circumvention review is initiated by the publication of an administrative resolution 
in Peru's official gazette "El Peruano", any interested party may present its views and commentaries 
to the proceeding during the probationary period . Furthermore, any interested party may request 
its incorporation as a party to the proceeding, and by doing so, it would be granted access to the 
public records of the proceeding and also be notified with any resolution, such as those that declare 
the confidenti ality of certain information provided by a party, the essential facts document, the views 
and comments of other parties to the proceedings, among others.  
 
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