G/ADP/Q1/USA/32  
G/SCM/Q1/USA/32  
 
21 October 2016  
(16-5763) Page: 1/2 
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 FROM MEXICO REGARDIN G THE  
NOTIFICATION OF THE UNITED STATES2 
The following communication, dated 21 October  2016, is being circulated at the request of  the 
delegation of the United States . 
 
_______________  
 
 
The United States thanks the delegation from Mexico for its questions and replies as follows:  
 
Question 1  
 
With respect to the comparison between export price and normal value, could the 
United  State s please explain in detail in what way the modifications mad e to 
regulations  19 CFR 351.102  (b)(38) and 19  CFR 351.401  (c) are consiste nt with 
Article  2.4 of the Anti -Dumping Agreement?  
Reply  
 
The modifications to 19 CFR 351.102(b)(38) and 19 CFR 351.401(c ) are consistent with U.S. law, 
which is consistent with the obligations of the United States under the Agreement on 
Implementation of Article VI of the General Agreement on Tariffs and Trade (AD Agreement). In 
particular, 19 U.S.C. sec. 1677a and 19 U.S.C . sec. 1677b(a)(1)(B)(i) provide that, in determining 
export price or normal value, the U.S. Department of Commerce (Commerce) begins with the price 
at which the subject merchandise or foreign like product is first sold. This price may or may not 
reflect c ertain discounts, rebates, or similar price adjustments. Commerce has developed a 
practice of denying certain post -sale price adjustments where facts and circumstances warrant. 
The modifications to the regulations at issue merely codify this practice. Article 2.4 of the 
AD Agreement does not prohibit Commerce from relying on the conditions agreed upon by the 
parties to the transaction at the time of sale for purposes of its antidumping calculations.  
 
Question 2  
Could the United States please clarify: (1) wh ether the basic "starting price" (referred to 
on page 6 of the notification) corresponds to the price that appears on the invoice, 
providing discounts and rebates known to the customer, and (2) whether this is the 
price to which post -sale discounts and reb ates could apply?  
Reply  
 
Identifying the basic "starting price" in light of any relevant discounts and rebates will depend on 
the facts and circumstances of a particular respondent company being examined in an 
investigation or review, and can depend on the  company 's books and records, and other 
                                                
1 G/ADP/Q1/USA/29 -G/SCM/Q1/USA/29 (dated 3 October 2016) . 
2 G/ADP/N/1/USA/1/Suppl.24.  G/ADP/Q1/USA/32 • G/SCM/Q1/USA/32  
 
- 2 - 
 
  considerations. Generally, the "starting price" is the "gross price" as stated on an invoice before 
the application of discounts, rebates and other billing adjustments, any of which may or may not 
appear on the comme rcial invoice. For example, in some instances a discount or rebate may not 
appear on the invoice, but would be credited to the customer well after the time of sale. As 
discussed in the notification, in determining whether to grant the price adjustment, Com merce 
may consider whether the terms and conditions of the adjustment were established and/or known 
to the customer at the time of sale, and whether this can be demonstrated through 
documentation; how common such post -sale price adjustments are for the com pany and/or 
industry; the timing of the adjustment; the number of such adjustments in the proceeding; and 
any other factors tending to reflect on the legitimacy of the claimed adjustment.  
 
Question 3  
Could the United States please clarify whether a discoun t or rebate subsequent to the 
period of investigation, corresponding to a transaction conducted during the period of 
investigation, would be accepted or regarded as a post -sale adjustment, subject to 
review by the authority for the purpose of determining w hether it is appropriate?  
Reply  
 
As noted above in response to Question 2, whether Commerce would accept a certain price 
adjustment depends on the facts and circumstances of a particular respondent company in a given 
investigation or review. As discussed i n the notification, in determining whether to grant the price 
adjustment, Commerce may consider whether the terms and conditions of the adjustment were 
established and/or known to the customer at the time of sale, and whether this can be 
demonstrated throu gh documentation; how common such post -sale price adjustments are for the 
company and/or industry; the timing of the adjustment; the number of such adjustments in the 
proceeding; and any other factors tending to reflect on the legitimacy of the claimed adj ustment.  
 
 
__________