G/ADP/Q1/BRA/28  
G/SCM/Q1/BRA/28  
 
16 December 2014  
(14-7272)  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 QUESTIONS POSED BY THE UNITED STATES1 
REGARDING THE REPLIES OF BRAZIL2 
The following communication, dated 12 December 2014,  is being circulated at the request of the 
Delegation of Brazil.  
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 Question 1  
 
In response to Question 3 regarding Brazil's home market viability test, Brazil states it 
requests information regarding the cost of production in all of its investigations; 
therefore, it is always possible to use cons tructed value whenever necessary. Does this 
mean in all instances where Br azil determines the home market  is not viable, it will use 
constructed value as the basis for normal value instead of attempting to make price-to-price comparisons using sales in an  alternative third country market? 
 
Reply 
 
Brazil will not use constructed value as a basis for normal value in all cases. In the questionnaire 
sent to foreign producers/exporters, the Brazilian government asks for information regarding the cost of production of all products as well as for information concerning the sales to other countries. 
Therefore, the respondents are given the opportunity to submit sales and cost data for a 
third country right from the start.  In fact, Brazil has used export price to a third country as basis for normal value in several 
investigations, such as (i) reduced indigo blue (ID 0702023); (ii) light weight coated 
paper (ID1010149); heavy places (ID 1204831); new bicycle tires (ID 1211361).  
Question 2  
 In its response to Question 5, Brazil stat es it is the understanding of the Brazilian 
authority that sales to other companies under tolling arrangements should be 
considered outside the ordinary course of  trade. Please explain further why Brazil 
considers these sales to be outside the ordinary course of trade and whether other factors surrounding the circumstances of th ese sales (e.g., price, whether the title 
passes to the company performing the tolling services, etc.) are considered.  
 Reply 
 Sales under tolling arrangements are considered to be outside the ordinary course of trade because the Brazilian authority understands that prices in such arrangements tend to be lower 
than those practiced in other sales, since the cost of raw materials in tolling arrangements is not 
usually included in the sales price that would be reported and used in the calculation of the normal 
                                               
1 G/ADP/Q1/BRA/26-G/SCM/Q1/BRA/26. 
2 G/ADP/Q1/BRA/24-G/SCM/Q1/BRA/24. G/ADP/Q1/BRA/28 • G/SCM/Q1/BRA/28 
 
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  value. According to the Brazilian AD legislation, once a sale is considered as being made under a 
tolling arrangement, it must be disregarded in the calculation of normal value, regardless of other factors surrounding the circumstances of these sales.  
 
Question 3  
 In response to Question 12, Brazil states that  interested parties have an opportunity to 
request a hearing within the five month period following the initiation of the 
investigation. Is there a deadline by which the hearing must take place? For example, 
d o e s  t h e  h e a r i n g  a l s o  h a v e  t o  t a k e  p l a c e  w i t h i n  f i v e  m o n t h s  o f  i n i t i a t i o n  o r  d o e s  t h e  hearing just need to be requested within this timeframe? If a hearing is requested 
within the initial five month period, should it not be held later in the investigation 
(e.g., after verification or after the St atement of Essential Facts for the final 
determination has been released), when there is a more fulsome administrative record?  
 
Reply 
 
The hearings only need to be requested within the five month period following the initiation. Since 
new information may be presented in these hearings, such events must take place within the fact-finding phase, even though there is no deadline by which these hearings must be held. Furthermore, as previously mentioned in the response to Question 12, near the end of the 
investigation, after the report with the essential facts has been released, interested parties have 
the opportunity to submit written information.   
Question 4  
 In response to Question 13, Brazil states th at as general guidance, the cut-off date for 
respondents to submit information for consid eration in the preliminary determination is 
the due date of the respondent's original qu estionnaire response (including any granted 
extensions). Please clarify whether, in those instances where a supplemental 
questionnaire is issued and the respondent pr ovides a timely response, the respondent's 
replies to the supplemental questionnaire w ill be considered in the administrating 
authority's preliminary determ ination or will the administrating authority use facts 
available for the preliminary determinat ion. Please explain what steps the 
administrating authority is taking to ensure  its preliminary determ inations are made on 
the basis of the actual data submitted by the respondents and not facts available due 
merely to the expedited case timelines und er DECOM's new antidumping regulations.  
 
Reply 
 While the respondent's reply to the supplemental qu estionnaire will probably not be considered in 
time for the preliminary determination, DECOM will  still consider actual data submitted by the 
respondent in the original questionnaire response, and it only occasionally uses secondary information available. Also, DECOM usually grants extensions also for the supplemental 
questionnaire response.  
 Question 5  
 
In response to Question 15, Brazil states th at, in determining whether or not to impose 
provisional duties, CAMEX considers the info rmation provided in DECOM's preliminary 
report as well as information provided by interested parties to GTIP. We further 
understand that, under Brazil's new anti-dumpi ng regulations, Brazil can decide not to 
impose provisional duties even in instance s where DECOM finds dumping, injury to the 
domestic industry, and a causal link between the dumping and the injury. Please explain 
in further detail the roles of DECOM, GTIP, and CAMEX in determining whether 
provisional duties are imposed in  antidumping investigations.  
 
Reply 
 
While DECOM conducts the investigation and reports its findings in a preliminary report, CAMEX is entitled with the decision on the imposition of such duties. Brazilian AD legislation provides that 
CAMEX may impose provisional AD duties as long as DECOM's preliminary report is positive for the G/ADP/Q1/BRA/28 • G/SCM/Q1/BRA/28 
 
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  existence of dumping, injury and causal link betw een these two previous elements and as long as 
CAMEX finds that such duties are necessary to pr event further injury from occurring during the 
conduct of the investigation. Additionally, CAMEX may decide for the non-imposition of provisional anti-dumping duties due to public interest conc erns, among other reasons. In cases where CAMEX 
decides not to apply such duties due to public interest, it will do so based on GTIP's findings, as 
GTIP is responsible for analyzing public interest complaints.  
Question 6   
 It is our understanding from Brazil's response s to questions 20 and 21 that requests for 
redeterminations may be limited to instan ces where the anti-dumping duty was based 
on lesser duty or the domestic industry prov ides evidence that the effectiveness of an 
anti-dumping measure has been compromised as  a result of the manner in which it was 
applied (e.g., per-unit duty versus ad valorem  duty). Is this understanding correct? How 
would a redetermination work in instances where the anti-dumping duty is based on 
lesser duty for some, but not all, of the re spondents? Would the redetermination result 
in a new anti-dumping duty rate for all respondents? Further, after a definitive duty has 
been put in place, what factors does th e administrating authority consider in 
determining whether it is appropriate to chan ge the type of duty (e.g., change from a 
per-unit duty rate to an ad valorem  duty rate)?  
 
Reply 
 
The understanding is correct. The redeterminations can be used in instances where the anti-
dumping duty was based on lesser duty; however, it shall be limited to those producers/exporters 
that benefit from the lesser duty. In principle, th e redetermination is made on an individual basis. 
Nevertheless, it may result in a new anti-dumping  duty rate for all producers/exporters depending 
on the case. As for the factors considered by the Brazilian authority in determining whether it is 
appropriate to change the type of duty, the price trend in the Brazilian market vis-à-vis the price 
trend in the international market may determine the need for an alteration in the manner in which the duty was applied. Also, the exchange rate trend in comparison with the inflation rate trend 
may be another factor to be deemed  relevant in such an analysis. 
  
 
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