WORLD TRADE  
ORGANIZATION   
G/ADP/Q1/AUS/12 
G/SCM/Q1/AUS/12 4 October 2012 
 
(12-5373) 
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 Posed by TURKEY1 Regarding 
the Notification of AUSTRALIA2 
   The following communication, dated 2 October 2012, is being circulated at the request of the Delegation of Australia. 
 
_______________ 
  
Question 1 
 
 According to the new Ministerial Direction, "material injury should be considered to be 
injury that is not immaterial, insubstantial or insignificant" .  Could Australia cl arify the terms of 
"insubstantial or insignificant material injury" ?  In the determination of material injury, how 
does the investigating authority determine that injury is not "insubstantial or insignificant" ?  Is 
there a test to be applied by the invest igating authority in the determination of "substantiality and 
significance of the material injury" ?  
 
Reply 
  The present definition of material injury i.e. not immaterial, insubstantial or insignificant , 
came from a report made in 1989 by the former Anti-Dumping Authority (Inquiry into Material 
Injury, Profit in Normal values, and Extended Period of Time, ADA Report No 4, March 1989).  The 
Authority had been asked, amongst other things, to de fine 'material injury'.  The Authority's report 
recommended against any quantitative guidelines.  This approach is similar to what can be seen in 
some other anti-dumping administrations.    
 Determining what is ' insubstantial or insignificant ' in relation to material injury is not 
something that can be determined through any partic ular test or threshold am ount as various industries 
can be quite different.  Any test or set definition c ould be meaningless across industries.  For instance, 
in one industry a 2% drop in profit could be viewed as being insignificant while in another more highly 
competitive industry, a 2% drop in profit could be seen  as being so significant that it could destroy the 
relevant local industry competitors.   
  This approach to a contextualised definition for these terms is in line with the WTO Anti-
Dumping Agreement which does not define what level of injury is material.  For instance, Article 3.2 of the Anti-Dumping Agreement contains the term 's ignificant price undercutting' and 'depress prices to 
                                                      
1 G/ADP/Q1/AUS/9-G/SCM/Q1/AUS/9.   
2 G/ADP/N/1/AUS/2/Suppl.6-G/S CM/N/1/AUS/2/Suppl.4.   G/ADP/Q1/AUS/12 
G/SCM/Q1/AUS/12 Page 2 
 
 
  a significant degree' but does not define what is signif icant in either of these contexts.  This leaves the 
determination of significance to the authority itself.  
Question 2 
 
 According to the new Ministerial Direction, "the injury caused by dumping or 
subsidisation must be material in degree". Could Australia elaborate on the terms of the "material 
in degree" ?  How does the Australian inve stigating authority measure the "material in degree" ?  
Is there a threshold for degree to be established in material injury? 
 
Reply 
  The phrase "material in degree"  relates to the requirement to fi nd that injury must be genuine 
and based on factual findings a nd not merely based on "merely alle gation, conjecture or remote 
possibility".
3 
  The level of degree is one that must be materi al and significant.  As material injury is not 
defined in the WTO Anti-Dumping Agreemen t or the WTO Agreement on Subsidies and 
Countervailing Measures, it is up to the authority to determine what degree materiality must be 
determined as it is a contextual matter based on the in dustry.  This approach is similar to the approach 
in Question 1 to the definition of material injury more generally. 
 
Question 3 
 
 According to the new Ministerial Direction, "the impact of dumped or subsidised imports 
on the rate of domestic industry's growth is considered".  Could Australia clarify how the growth 
rate of the industry is determined?  What are th e bases, criteria or economic models used in 
establishing the rate of growth of the domestic industry?  In establishing the growth rate of the 
industry, does the Australian investigating auth ority provide and take into consideration the 
economic indicators of non-cooperating companies?    
 
Reply 
 
 The comment quoted in your question ' the impact of dumped or s ubsidised imports on the 
rate of domestic industry's growth is considered ' is not located in the Ministerial Direction.  However, 
the Ministerial Direction does show the intent to  cover a situation where dumping or subsidisation 
may result in injury where it has caused the rate of  an industry's growth to slow, without causing it to 
contract, such as where an industry suffers a loss of market share in a gr owing market, without a 
decline in profits.   More generally, the issue examined  here is the rate of growth in the industry as a whole, not 
just cooperating parties.  Estima tes are made of the size of the  total market usually in terms of sales 
and of the Australian industry's total sales volume.  The rate of growth is based on observations of 
that data over time.   This of course is dependent on such data bei ng available.  If for some reason it is impossible 
to know these details, then this particular cr iterion within the Direction could not have any 
application. 
                                                      
3 Article 3.7 of the Anti-Dumping Agreement requires a threat of material injury to be factual and not 
based merely allegation, conjecture or remote possibility.  G/ADP/Q1/AUS/12 
 G/SCM/Q1/AUS/12 
 Page 3 
 
 
  Question 4 
 
 In the new Ministerial Direction it is stated that "I direct that the above directions be 
adapted and applied by you to consideration of claims of threatened material injury or hindrance to 
the establishment of an industry" .  
  Could Australia confirm that this direction w ill be applied in cases of "threat of material 
injury" or "material retardation of the establishment of the domestic industry"? 
 Reply 
 
 Yes,  Australia confirms that the wording "I direct that the above directions be adapted and 
applied by you to consideration of claims of threatened material injury or hindrance to the 
establishment of an industry"  will be applied in cases of "threat of material injury" or "material 
retardation of the establishm ent of the domestic industry". 
   
__________