G/SG/N/8/CRI/1  
G/SG/N/10/CRI/1  
G/SG/N/11/CRI/1  
20 January 2015  
(15-0359)  Page: 1/5  
Committee on Safeguards  Original: Spanish  
 
  NOTIFICATION UNDER ARTICLE 12.1(B) OF THE AGREEMENT ON SAFEGUARDS 
ON FINDING SERIOUS INJURY OR THREAT THEREOF 
CAUSED BY INCREASED IMPORTS 
 
NOTIFICATION PURSUANT TO ARTICLE 12.1(C) 
OF THE AGREEMENT ON SAFEGUARDS 
 
NOTIFICATION PURSUANT TO ARTICLE 9, FOOTNOTE 2, 
OF THE AGREEMENT ON SAFEGUARDS 
COSTA RICA 
(Pounded Rice) 
The following communication, dated 19 January 2015, is being circulated at the request of the 
delegation of Costa Rica. 
 
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Pursuant to Article 12.1(b) and 12.1(c), and Articl e 9, footnote 2 of the Agreement on Safeguards, 
and in the light of the agreed format for notifica tions (G/SG/1/Rev.1), Costa Rica hereby provides 
the following notification to the Committee on Safeguards. 
 
1. Evidence, relevant data and the applicable  period of investigation of serious injury 
or threat thereof caused  by increased imports. 
1.1. Determination of th reat of serious injury. 
Having analysed all relevant factors of an objective and quantifiable nature relating to the 
domestic industry, the investigating authority concluded that no serious injury had been caused to 
the domestic industry during the period under investigation, i.e. from 1 January 2011 
to 31 December 2013 (three years).  However, the investigating authority did determin e the existence of a threat of serious injury. 
In reaching that determination, the authority evaluated all relevant factors of an objective and 
quantifiable nature having a bearing on the situation of the producers of the product under investigation in conformity with Article 4.2(a) of  the Agreement on Safeguards. In addition, based 
on the guidance provided by the panel in US - Lamb , the authority also evaluated the factors set 
forth in Article 3.7 of the Anti-Dumping Agreement on the threat of material injury, as they were 
considered relevant to this safeguard investigation. 
 
It was shown that in 2013, pounded rice from th e origins under consideration was imported into 
the Costa Rican market in greater quantities and higher volumes (202%). Over the entire investigation period, the increase amounted to 86%, i.e. 7,349.43 MT. 
 
It was found that there had been a deterioration in the overall condition of the domestic industry during the investigation period. Utilization of installed capacity (machinery and equipment) 
decreased throughout the investigation period (by 10 percentage points). Production of pounded 
rice decreased by 7.45% in 2012, and by 0.67% in 2013. Meanwhile, sales fell by 12.76% in 2012, recovering in 2013 (5.51%) without reaching the 2011 level. Productivity fell steadily G/SG/N/8/CRI/1 • G/SG/N/10/CRI/1 • G/SG/N/11/CRI/1 
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  throughout the investigation period, from 13.89 MT/employee in 2011 to 10.8 MT/employee 
in 2012 (reflecting the increase in the size of  the direct labour force and the decrease 
in production).  
As regards market share, while imports in the mo st recent period accounted for 6.7%, the share 
of domestic production fell by 6.65 percentage points in 2013 compared to 2012.  
With respect to the Profit and Loss Statement, do mestic industry's net sales from 2011 to 2013 
were found to have decreased by 14.77%, and to tal costs to have fallen as well, by 13.45%. 
Thus, in view of the decline in net sales, there was a decrease in the domestic industry's gross profits of 37.52% for the whole period, pointing to a decline in profits for the period under 
analysis. 
 Once the evaluation of all relevant factors of an objective in quantifiable nature having a bearing 
on the domestic industry (Article 4.2(a) of th e Agreement on Safeguards) had been completed, 
an analysis was conducted of the factors set forth in Article 3.7 of the Anti-Dumping Agreement for the reasons provided above. 
 
It was shown that the rate of increase of the imports under consideration was significant; that exporters of the product under investigation (namely Argentina and Uruguay) had excess capacity and high inventories, while at the same time th ere was a significant gap between the price of the 
product under investigation and domestic pounded rice. Based on the above considerations and 
on the fact that there was an increase in production and exportation at low prices by Thailand and Viet Nam and that Brazil and Peru were self-sufficient, Uruguay and Argentina could be expected 
to substantially increase their exports of pounded rice to Costa Rica in the near future. 
 These circumstances, together with the vulnerab le overall situation of the domestic industry, 
pointed to the conclusion that material injury to the domestic industry was clearly imminent. 
 2. Information on whether there is an absolut e increase in imports or an increase in 
imports relative to domestic production (see also Article 12.1 for the context). 
2.1. Absolute increase in imports. 
It was shown that the imports of pounded rice under consideration increased in absolute terms 
from 8,497.55 tonnes in 2011 to 15,846.98 tonnes in 2013, i.e. a total increase of 86.4% 
(end point to end point). The increase was in fact sharper during the most recent period 
(2012-2013), reaching 201.97%.  
2.2. Increased imports releva nt to domestic production. 
While the volume of imports under consideration of the investigated product in relation to domestic 
production decreased in 2012 by 2.52%, in 2013 there was a sharp increase: 7.73% against domestic production. 
 
Hence the conclusion that the increase in the imports of pounded rice under consideration was sharp , since in absolute terms, it reached 201.97% (more than 10,500 metric tonnes) during the 
most recent period (2012-2013), and in relation to domestic production, it reached 7.73%. 
The increase was sudden  in that it took place from one year to the next in an unforeseen manner. 
It was significant  in that the imports increased by a total of 7,349.43 metric tonnes during the 
period under consideration. It is fairly recent , in that the significant increase in imports has taken 
place since the last quarter of 2012, and their ra te of growth increased until the last quarter 
of 2013. The information relating to 2014 confirms that imports of rice from the sources under consideration persist. 
 
3. Precise description of the product involved. 
Pounded rice, Central American Harmonized System (SAC) tariff subheadings 1006.30.90.91 and 
1006.30.90.99. 
 G/SG/N/8/CRI/1 • G/SG/N/10/CRI/1 • G/SG/N/11/CRI/1 
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  4. Precise description of the proposed measure (Harmonized System (HS) codes 
at a 6-digit level, and at a sub-nation al level – 8-digit – if practicable).  
Definitive safeguard measure consisting of an addi tional 27.06% on the existing tariff level of 35% 
of the Import Customs Duty (DAI), bringing the total to 62.06% on the CIF value of all imports 
of pounded rice, of whatever origin, imported into Costa Rica under tariff subheadings 
1006.30.90.91 and 1006.30.91.99.  
5. Proposed date of introduction of the measure. 
The measure will come into effect on the day following the expiry  of the 30 calendar days accorded 
to WTO Member countries having a substantial interest as exporters of the product concerned to hold prior consultations. These consultations will begin on the next working day following the 
notification to the WTO Committee on Safeguards. 
 6. Expected duration of the measure. 
The measure will be applied for a period of four years in accordance with Article 7 of 
the Agreement on Safeguards and Article 32 of the Central American Regulations on Safeguard 
Measures, following the liberalization timetable set forth in point 8 below. 
 
7. Proposed date for the review (under Article 7.4) to be held not later than the 
mid-term of the measure, since the durati on of the measure exceeds three years. 
The date of the review under Article 7.4 of the Agreement on Safeguards has not yet been set. 
 
8. Expected timetable for progressive liber alization of the measure, since it is 
a measure within a duration of over one year.  
In order to facilitate the adjustment of the domestic industry in accordance with Article 7.4 
of the Agreement on Safeguards, the safeguard measure will be liberalized progressively and at regular intervals during the period of application, in accordance with the following timetable: 
 
Date*  Reduction  Tariff 
Entry into force: 19 February 2015   62.06% 
19 February 2016 6,765% 55,295% 
19 February 2017 6,765% 48.53% 
19 February 2018 6,765% 41,765% 
As of 19 February 2019 6,765% 35.00% 
 * Estimated date of entry into force. 
9. Developing countries to which the measure is not applied under Article 9.1 
of the Agreement on Safeguards, and the import shares of these countries 
individually and collectively.  
Under Article 9.1 of the Agreement on Safeguards, the definitive safeguard measure shall not be 
applied against products of the following origins as long as the conditions set forth in that article 
persist: Colombia, Brazil, Ecuador, Republic of South Africa, Paraguay, Viet Nam, Thailand and Mexico, whose exports of pounded rice to Costa Rica during the period 2011-2013 did not 
exceed 3% of Costa Rica's total imports and which collectively accounted for not more than 9% 
of total imports.  G/SG/N/8/CRI/1 • G/SG/N/10/CRI/1 • G/SG/N/11/CRI/1 
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  De Minimis Volume 
Imports of Pounded Rice 
(Tariff Subheadings 1006.30.90.91 and 1006.30.90.99) 
 
Country/Year 2011 2012 2013 Period 2011-2013 
Quantity  
(MT) Quantity  
(MT) Quantity  
(MT) Total Share 
(%) 
Colombia 0 0 0  0 
Brazil 250 0 0 250 0.39 
Ecuador 46 0 0 46 0.07 
Republic of South Africa 0 0 0 0 0 
Paraguay 0 0 0 0 0 
Viet Nam 0 0 2 2 0 
Thailand 0 0 3 3 0.01 
Mexico 0 0 351 351 0.54 
Total 296 0 356 989 1.01 
 The conditions of Article 9.1 are no longer consid ered to apply when the volume of imports of the 
product under investigation from the exempted origins or other importers (non-traditional 
importers) exceeds 950 MT, which corresponds to 3% of the total volume of imports of pounded 
rice during the most recent part of the period under investigation (2013). 
 10. Since this notification relates to the application of a safeguard measure, the 
following information is provided:  
(i) The major exporting Members of imports of the product involved: 
The table below shows the main countries of pr ovenance of the imports of the product under 
investigation during the investigation period: 
 
Members with the Greatest Share of the Total Imports of Pounded Rice 
(Period 2011-2013) 
Country Share % 
United States (within the CAFTA quota) 27.58 
Argentina 23.38 
Nicaragua 16.34 
Uruguay 14.67 
El Salvador 8.27 
United States (outside the CAFTA quota) 6.83 
 
(ii) Exporting Members to which the measure does not apply for any reason 
other than the application of Article 1.9 and the reasons for non-application 
of the measure:  
Imports from Central America and the United States within the quota of the Free Trade Agreement 
between the United States, Central America and the Dominican Republic (CAFTA) are exempted 
from the safeguard measure pursuant to the Gene ral Treaty on Central American Integration, 
the Central American Regulations on Safeguard Measures, and CAFTA.  G/SG/N/8/CRI/1 • G/SG/N/10/CRI/1 • G/SG/N/11/CRI/1 
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  11. Reference, in electronic form, to pub licly available document(s) containing the 
relevant decision(s) made by the competent authority 
Resolution No. DM-001-2015 of the Ministry of  the Economy, Industry and Trade (MEIC) on 
the request for application of a definitive safeguard measure on imports of "pounded rice" 
entering Costa Rica under SAC tariff subheadings 1006.30.90.91 and 1006.30.90.99 as well as 
the Technical Report of the Final Determination DDC-INF-007-14, both from MEIC Trade Defence 
Directorate File 002-2013, can be accessed th rough the following link: http://goo.gl/oeDM1e. 
 
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