TN/RL/GEN/185  
 
24 April 2017  
(17-2231) Page: 1/5 
Negotiating Group on Rules  Original: English  
 
PROPOSAL ON TRADE RE MEDIES  
SUBMISSION BY CHINA 
The following communication, dated 21 April 2017 , is being circulated a t the request of the 
Delegation  of China . 
 
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1  BACKGROUND AND CHINA 'S POSITION  
Rules are the foundation for upholding and sa feguarding the open and non -discriminatory 
multilateral trading system in the world. Recognizing the lingering  and serious challenges the 
multilateral trading system is faced with, such as the global economic slowdown, the rising  
protectionism and the rapi dly changing international marketplace , China sees the merit of 
continu ing to seek balance d results of the Rules Negotiations to the furtherance  of the rules-based 
multilateral  trading system.  
 
The Rules N egotiations  on Anti-dumping and Subsides  and C ountervailing  Measures  are key 
subjects in Rules N egotiations  and one of the essential components  of the Doha Development 
Agenda (DDA) . As mandated by the Ministerial Declaration of the Doha Ministerial Conference,  the 
Rules N egotiations  on Anti-dumping and Subsides  and C ountervailing  Measures  are aimed at 
clarifying and improving disciplines under the Anti -Dumping Agreement  (ADA) and the Agreement 
on Subsidies and Countervailing Measures (ASCM)  while preserving the basic  concepts, principles 
and effectiveness of these Agreements and their instruments and objectives, and taking into 
account the needs of developing and least -developed participants .  
 
China values the strenuous  efforts made by all Members in promoting the rules negotiations on AD 
and CVD under DDA , and acknowledges the achievement of substantial results on AD and CVD 
Rules Negotiation by the Negotiating Group on Rules as embodied  in the communications from the 
Chair on 21 April 2011 (TN/RL/W/254), on 19 Decemb er 2008 (TN/RL/W/236) and on 
30 Novembe r 2007 (TN/RL/W/213) respectively . Recalling particularly those  efforts made by some 
Members and the Friends of Anti -dumping Negotiations (FANs) Group in recalibrating the 
negotiations  in recent years, we are encouraged  by the fact  that commitments  have ne ver been 
given up.  
 
Reviewing  the increas ed application of AD and CVD instruments by Members, we are concerned 
that it is even more important now than ever to further clarify and strengthen the AD and CVD 
rules.  Over the last two decades,  the application of AD and CVD measures has no longer been 
limited to the traditional users.  While a number of rules remain unclear  or ambiguous , AD and CVD 
are often misused in many cases. Disparate application of the same rules has given rise to  
increase d trade disputes under the WTO Dispute Settlement Mechanism  in recent years. Moreover, 
overused AD and CVD measures for policy considerations and their distortion ary effects  on 
international trade  as well as the internal markets of the investigating Members  to the harm of all 
Members involved and their downstream industries/consumers has no longer been an exceptional 
phenomenon.  
 
China stands ready to work with all Members together hand in hand to reaffirm and fulfil the 
commitment  of the international community  to preserv e the process of reform and liberalization of TN/RL/GEN/185  
 
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  trade policies in promoting recovery, growth and free trade to  the benefit of all Members and a 
liberal, rules -based multilateral trading system.  
 
2  A SUMMARY OF CHINA 'S PROPOSAL  
2.1  The basis for potential further progress in Rules Negotiations  
We recall that in the negotiations on anti -dumping, the Negotiating Group on Rules has been 
discussing in detail proposals on such issues as determinations of injury/causation, the lesser duty 
rule, public interest, transparen cy and due process, interim reviews, sunset, duty assessment, 
circumvention, the use of facts available, limited examination and all others rates, dispute 
settlement, the definition of dumped imports, affiliated parties, product under consideration, and 
the initiation and completion of investigations.  
 
In respect of subsidies and countervailing measures, proposals for amendments to the ASCM ha ve 
been submitted on a number of issues, including the definition  of a subsidy, specificity, prohibited 
subsidies, s erious prejudice, export credits and guarantees, and the allocation of benefit.  
 
We also note that based on the consolidated text of 2011 (TN/RL/W/254), there is a growing 
convergence among Members regarding the un -bracketed issues. Meanwhile, there are a lso a 
number of bracketed issues on which members have divergent views.  
 
Moreover, we notice that the Appellate Body and panel s have clarified important issues in quite a 
few cases , which would give clear guidance and reference to the Rules Negotiation s. 
 
2.2  A summary of China 's proposal  
Given the present state of play in the negotiations, it would be feasible to promote the  Rules  
Negotiations  by seeking to identify and prioritize important and "do-able" issues as the starting 
points for further discussions , and putting forward them in a balanced  and efficient way. Aiming at 
achieving further progress  in the Rules Negotiations on AD and CVD in terms of the transparency, 
predictability and clarification of the disciplines, we would tentatively  propose the follo wing aspects 
for further discussion and negotiation.  
 
(1) Enhancing transparency and strengthening  due process  
(2) Preventing AD  measures from becoming "permanent " 
(3) Preventing AD  measures from "overreaching " 
(4) Special consideration  and treatment of SMEs  
(5) Transplantin g similar provisions from ADA to ASCM  
 
3  BY-ITEM  EXPLANATIONS  
3.1  Enhancing transparency and strengthening  due process  
Transparency and due process in AD and CVD  investigation proceedings are vital for interested 
parties on both sides to effectively defend their  rights and interests, and for investigation 
authorities to make fair and impartial determinations. Enhancing transparency and  due process  is 
the common goal of all Members. Based on the consolidated text of 2011 (TN/RL/W/254), this is 
also the area where opinions are highly convergent . Therefore, we propose to move forward based 
on the existing achievements in the following  aspects , i.e. the petitioner 's standing , notice before 
initiation, a ccess  to information , disclosure  and eviden tiary standards  for sub sidy allegations . 
 
3.1.1   Petitioner 's standing  (ADA Article 5.4)  
(1) The footnote 14 under ADA Article 5.4 indicates that Members are aware  that in the territory of 
certain Members  employees of domestic producers of the like product or their representatives may 
make or support an application for an investigation, while the Article 5.4 standard is based  on the 
collective output  by domestic producers in support . Therefore, the footnote 14 need be further 
clarified that even if employees of domestic  producers or rep resentatives of those employees may 
make or support an application for an investigation , the collective output of domestic producers of 
the like product shall still satisfy the requirements  as set forth  in Article 5.4.  
 TN/RL/GEN/185  
 
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  (2) Article 5.4 in the consolidated text of 2011 (TN/RL/W/254) provides that "[f]or the purpose of 
this paragraph, the term 'domestic industry ' shall be interpreted as referring to the domestic 
producers as a whole of the like product, subject to the application of Article 4.1(i) and 4.1(ii) ." 
This addition is proposed be accepted as it ensures consistent application of different articles.  
 
3.1.2   Notice before initiation (ADA Article 5.5)  
Considering that Article 5.5 in the consolidated text of 2011 (TN/RL/W/254) has provided detailed 
clarification s on timing and manner of notification, it is proposed that such amendments  be 
accepted.  
 
3.1.3   Access to information (ADA Article 6.4, Article 6.5.1)  
Considering that Article 6.4 and Article 6.5.1 in the consolidated text of 2011 (TN/RL/W/254) ha ve 
reflected ma ny Members ' practice and new development s, and also reflected  recent DSB 
determinations, we propose to accept them in the interest of consolidat ing the achievements and 
explor ing further improvements.  
 
3.1.4   Disclosure (ADA Article 6.9)  
In terms of disclosure pr actice is different among Members. In order to improve transparency  in 
this area with the aid of more detailed guidance, we propose to adopt Article 6.9 and Article 6.9 bis 
in the consolidated text of 2011 (TN/RL/W/254) as the basis for further  discussion.  
 
3.1.5   Eviden tiary standards  for subsidy allegation s (ASCM Article 11.2(iii), Article 11.3)  
The evidence laid out by petitioners for subsidy allegations  shall be sufficient  to reflect  such basic 
elements as financial contribution, specificity  and benefits of the  subsidy in question. The 
authorities shall conduct timely and full consultations with Members the products of which are the 
subject of the investigation on the accuracy and adequacy of the evidence provided in the 
application.  
 
3.2  Preventing AD measures from  becoming "permanent " (ADA Article 11.2, 
Article11.3)  
Examining the practice of applying AD measures in past years, we are concerned that some AD 
measures have been  maintained for over a decade or even longer1, thus becoming almost 
"permanent ". Given the r apid speed of structural changes witnessed on the market, both 
international and domestic, and fast pace of technological advances, overly prolonged or even 
"perpetualized " application of AD would serve no commendable purpose other than to prove a de 
facto trade barrier to the outside world and a choking dampener for the domestic industry 's 
incentives to compete by innovation. Therefore, in order to improve  the predictability of AD  
measures , protect the legitimate interests of interested parties and prevent  unintended and 
excessive distortions to international trade as well as investigating Member 's internal market , it is 
important to strengthen  disciplines and clarify rules on sunset review.   
 
(1) Once a sunset review is initiated upon a duly substantiated requ est made by or on behalf of 
the domestic industry, the requirements  on petitioner 's standing  as defined under 
Article  5.42 shall be satisfied.  
 
(2) A sunset review of a measure shall be initiated on a date not later than the date of expiry of 
the measure which  is normally five years , and be completed preferably  before the date of 
expiry . In case the review is finished past the date of expiry of the reviewed measure , the 
reviewed  measure shall be suspended or duty be imposed provisionally  pursuant to Article 7 
and Article 10, where appropriate, from the date of expiry pending the outcome of such 
                                                
1 In an extreme case, the duration of an AD measure has lasted for  39 years. According to China 's 
statistics , in some Member 's practice, there are 25 AD measures being applied for mo re than 30 years, and 
another around 45 AD measures in force for more than 20 years.  
2 For discussion purposes, the draft legal language proposed in this document mirrors the current 
disciplines of Article 5.4 of the ADA and Article 11.4 of the ASCM. Any i mprovements to or clarification on these 
provisions that may result from the negotiations would in principle apply.  TN/RL/GEN/185  
 
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  review, and  in such case  the final determination  of such a review shall take effect 
retrospectively as of the date of expiry.  
 
(3) In no event shall a definitive AD measure be applied upon review for a period of  more than 
10 years from the date of its imposition.  
 
3.3  Preventing AD  measures from "overreaching " 
Members are  aware  that domestic  legislations on anti -circumvention have been adopted and such 
measures taken by some Members, which in fact has expanded  the application of original AD 
measures. It would be valuable and necessary to finalize  a set of  clear, unified and balanced rules 
in this area. However, before the consensus  is reached, the Members  shall refrain from initia ting 
anti-circumvention  investigations where  the initiation of a new  AD investigation would be a more 
appropriate approach or in cases such anti -circumvention investigations are used as a more 
convenient instrument than AD proceedings to achieve excessive protection for the domestic 
industry of the investigating Members . 
 
3.4  Special consideration  and treatment of SMEs  
It is well -accepted  that S mall and Medium -sized Enterprise s (SMEs)  with their vigor and 
competitiveness are among the powerhouses  for creating j ob opportunities and promoting 
technology innovation  as well as economic  development.  Particularly in light of  the global and local 
economic difficulties, it  is our responsibility  to help create a free trading environment  for the SMEs 
and facilitate their participation  in international trade and cooperation.  
 
Considering  the multifarious  difficulties and many heavy burden s confronted  by SMEs  n responding  
to trade remedy proceedings  due to their limited capacities  and lack of experience with such 
endeavors , special consideration  should  be given  to them. We note that ADA Article 6.13 and 
ASCM Article 12.11  have already provided "[t]he authorities shall take due account of any 
difficulties experienced by interested parties, in particular small companies, in sup plying 
information requested, and shall provide any assistance practicable ". However, this is obviously 
insufficient to reduce the SMEs ' burden in participating in the proce edings  and defend their 
legitimate  rights and  interests. Therefore, we propose to a dd in an independent  article "Small and 
Medium -sized Enterprise s" with the following elements.  
 
(1) In principle, t he authorities sh ould make active effort s to identify small and medium -sized 
exporters when needed, take due account of any difficulties experien ced by  them in the 
process of investigations and provide them any practicable assistance.  
 
(2) In details, a ssistance s to SMEs may include but not limited to : 
 
a. The authorit ies shall take due account of difficulties of SMEs in getting access to 
information  and take appropriate measures to ensure easier access to relevant 
information including initiation, questionnaire , submission, disclosure and notices  etc. 
b. The authorities shall give full consideration to SMEs ' comments and opinions when 
making selection under Article 6.10. If SMEs have genuine  difficulties in providing full 
cooperation and present justifiable explanation , the authorities  may decide not to select 
them for limited examination.  
c. If SMEs are unable to submit questionnaires on time with  good cause , the authorities 
shall grant them reasonable extension upon request unless such extension will 
significantly impedes the investigation.  
d. The authorities shall provide any assistance practicable to SMEs by supplying information 
requested by the latter , includi ng responding in a timely manner to requests for 
clarification of questionnaires and permitting SMEs to submit questionnaires in less 
burdensome ways . 
e. The authorit ies shall take due account of price undertaking s offered by SMEs where 
appropriate.  TN/RL/GEN/185  
 
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  f. Article 2  and Article 5 of Appendix II shall be strictly observed even when information 
provided by SMEs may not be ideal in  all respects, and this situation shall not lead to a 
result which is less favorable  to SMEs if they provided  cooperat ion to the best of their 
abilities.  
3.5  Transplanting similar provisions from ADA to ASCM  
Since there are similar procedural  requirements  between AD and CVD proceedings, it is proposed 
that certain  provisions be transplanted  from ADA to ASCM, such as those relating to due process, 
transparency, and the annex II on best information available.  
 
 
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