WORLD TRADE  
ORGANIZATION  TN/RL/W/230 
17 April 2008 
 (08-1808) 
Negotiating Group on Rules Original:   English 
  
DRAFTING PROPOSALS ON ISSUES RELATING TO THE DEFINITION AND 
DETERMINATION OF "DOMESTIC INDUSTRY" (ARTICLE 4.1) AND THE  
STANDING REQUIREMENT (ARTICLE 5.4) OF THE  
ANTI-DUMPING AGREEMENT 
 
Communication from Norway
 
 
 
 The following communication, dated 16 April 2008,  is being circulated at the request of the 
Delegation of Norway.* 
 
_______________ 
 
1. Introduction 
1. The issues of standing and domestic industry have been among the issues identified by 
Members that must be addressed in the negotia tions.  This paper analyses the Chair's text 
(TN/RL/W/213) on the above mentioned issues as a contribution to the further negotiations in the 
Negotiating Group. 
2. A number of proposals have been made regarding these issues.1  Together with the comments 
and suggestions made in the Negotiating Group, they  form the basis for the textual proposals set out 
below.  We suggest that these amendments to the Chai r's text be made so as to provide Members with 
a better basis for further negotiations regarding these issues.  
3. This submission deals only with certain aspects of the requirements relating to standing and 
domestic industry.  Other aspects of these issues may be taken up at a later stage.  We, therefore, 
reserve the right to introduce other modifications  to these and other issues at a later stage.  
4. This submission is without prejudice to the view s we may have on other parts of the Chair's 
text. 
2. Domestic Industry 
5. Among the issues relating to the definition and de termination of "domestic industry" is the 
question of when, and for what purposes,  it is appropriate to exclude (i) a domestic producer that is at 
the same time itself an importer of the allegedly dumped imported product, and (ii) related producers. 
6. In respect of domestic producers that are at the same time importers  of the allegedly dumped 
imported product, the Chair has suggested a check-list for investigating authorities in footnote 17 to 
Article 4.1.  The proposal by the Chair is b ased on an obligation to check certain quantitative 
parameters, and sets out a "soft obligation" not to exclude a domestic producer whose imports are 
below the limits set forth in the new footnote 17 proposed by the Chair. 
                                                      
* This paper was submitted to the Negotiating Group as a room document in March 2008. 
 1 See e.g. TN/RL/GEN/19 of 15 September 2004. TN/RL/GEN/27 of 2 December 2004, 
TN/RL/GEN/69 of 13 October 2005. TN/RL/W/230 
Page 2  
 
  7. The consequence of the proposal by the Chair is that certain domestic producers will be 
included in the determination of what constitutes the "domestic industry" in a particular case, whereas 
others will be excluded.  This exclusion may be  operated both for the "standing requirement" in 
Article 5.4 and for the injury determination in Article 3. 
8. Where a domestic producer is related
 to one of the foreign producers in the country targeted 
by the application and subsequent investigation (w hether or not he also imports from the related 
producer), the clause relating to "relation" as set out in  footnote 16 applies.  This footnote sets out two 
main criteria – "control" and that the relati on causes the related domestic producer to behave 
differently.  
9. Also for related producers will such exclus ion normally operate both for the "standing 
requirement" and for the injury determination. 
10. The exclusion of both "related producers" and "domestic producers that are at the same time 
also importers of the allegedly imported product" may seem reasonable in respect of "standing".  As 
set out in footnote 16, exclusion of a "related producer" is allowed only where "[...] there are grounds 
for believing or suspecting that the effect of th e relationship is such as to cause the producer 
concerned to behave differently from non-related producers."   In a similar vein there may be grounds 
for suspecting that a producer that is at the same  time also an importer will generally not favour an 
investigation that seeks to limit its acc ess to merchandise from its suppliers. 
11. But these reasons to exclude certain domestic  producers from the "domestic industry" do not 
have the same rationale in respect of the determ ination of injury.  Where producers that are also 
importers are not excluded, as will sometimes be the case under the Chair's proposal, their economic 
situation will be assessed based on their own dom estic production. Importation of the allegedly 
dumped product from elsewhere will be consider ed a separate line of business according to 
Article 3.6, and the economic costs, gains and losses will not be considered when investigating 
authorities look at the economic situation of the do mestic industry.  This is no different from the 
situation where an included domestic producer also h as another line of business.  Only where it is not 
possible to separate the importation and resale of  allegedly dumped imports from own production may 
there be merit in excluding a producer that is also an importer from the injury determination. 
12. The same arguments apply to "related parties".  It is indeed difficult to see any reason why the 
domestic production of a related producer should be treated differently from the production by un-
related domestic producers.  While  the relationship may change th e producers attitude towards the 
investigation, that does not in itself change th e economic situation as regards its own domestic 
production. 
13. The practice regarding exclusions seems to vary  from Member to Member .  The interventions 
in the Negotiating Group indicates that a number of Members routinely exclude such domestic producers up front, whereas other Members have a more nuanced approach. 
14. Since these exclusions are important both to the determination that the standing requirement 
is met and to the injury determination, it is impor tant that any exclusions have a sound basis and be 
supported by a reasoned and adequate  explanation for the investigating authorities' decision to 
exclude such companies.
2  Excluding the data from such producers for the injury determination may 
seriously skew the data for the industry.   
                                                      
 2 We support the Chair's proposed footnote 18, which sets out the logical requirement that any decision 
by the authorities to exclude any company shall be fo llowed by a reasoned and adequate explanation of the  TN/RL/W/230 
 Page 3 
 
 
  15. We, therefore, propose that Articles 4.1(i) and 5.4 be redrafted so that the exclusions of 
"related producers" and "domestic producers that are at the same time also importers of the allegedly 
imported product" only apply to the "standing requi rement" and not to the injury determination. 
3. Standing Requirements for Initiation (Article 5.4)   
16. Through the combined provisions of Article 4.1(i) and 5.4 of the Anti-Dumping Agreement , a 
large percentage of domestic producers can be excluded from the domestic industry in assessing 
whether that domestic industry supports the initia tion of an investigation.  Consequently, an 
investigation may be initiated even  though supported by producers representing only a fraction of the 
domestic industry's total production of the like product.   
17. The Chair has suggested to introduce a new last  sentence in Article 5.4 that modifies the 
definition of "domestic industry" for purposes of th e standing requirement.  The effect of the Chair's 
proposal is that the thresholds in Article 5.4 (50 per cent and 25 per cent) shall be calculated from the 
"domestic producers as a whole" – and cannot be calculated from "those of them whose collective 
output of the products constitutes a major proportion  of the total domestic production of those 
products".  This clarification of what the denominat or should be is a positive step, but in our view not 
sufficient.  It will only be a very small contri bution towards limiting unwarranted investigations. 
18. In the negotiations, two other proposals have been widely discussed and have attracted 
considerable support, as was also expressed by a number of Members at the meeting in 
February 2008.  These two other issues relate to th e threshold itself, and how to determine standing 
where an application is filed by an industry associ ation.  Nevertheless, the Chair has so far not 
included them in the text. 
19. The issue of standing where an application is  filed by an industry association was also 
discussed in the Negotiating Group in relation to the Chair's proposed changes to Article 5.2(i), where 
the Chair has suggested to require the identity of  each producer member of the association supporting 
the application - except where this is not practicab le because of the fragmentation of the industry.   
20. We support the clarification that an applica tion must identify each producer supporting the 
application, and that any exception to this require ment must be narrowly construed.  Indeed, it is 
difficult to see how an industry association can legitim ately file an application without consulting its 
members on the issue.  The investigating authorities ca nnot just assume that an application filed by an 
association is ipso facto supported by all producers that are members of that association.  
Investigating authorities, in performing their task s and making their determinations under Articles 5.3 
and 5.4, must require that any industry associati on present sufficient evidence regarding support by its 
members for the application.   
21. Where the decision to file an application wa s not unanimously supported, only those members 
expressly supporting the application shall be consider ed "supporters" for purposes of Article 5.4.  The 
requirement of express support is already included in Article 5.4 in respect of the current 25 % rule, 
but should be clarified in the text as regards applications from industry association. 
22. We have listened with care to the concerns being expressed that in certain cases the industry 
is so fragmented, and has such a great number of  members, that getting statements of support or 
opposition to an application from all members is not possible.  We recognize that such exceptional 
circumstances may arise, and have  suggested a limited exception for industries that are so fragmented 
                                                                                                                                                                     
reasons meriting the exclusion, and that this shall be set forth in the relevant public notices or separate reports 
required by Article 12. TN/RL/W/230 
Page 4  
 
  that the associations cannot reasonably be expected  to provide the position of each and every one of 
its members.  The suggestion below is based on the clause found in existing footnote 22. 
23. Having benefited from the discussions in the Nego tiating Group on this issue, and to facilitate 
the further negotiations on the issue of "standing" , we, therefore,  propose the following two changes 
to the text of Article 5.4:  
(a) to require that the threshold for standing be increased so that producers accounting for 
at least 50 per cent of total domestic pr oduction must support an application for 
investigation
3; and 
(b) clarifying how to calculate standing where an application is submitted by industry 
association(s).  
4. Clarifying the exclusions of "related parties"    
24. As stated above, the key criterion in existing footnote 114 for justifying any exclusion of any 
related party is that there is both " control"  over the domestic producer, and that  "[...] there are 
grounds for believing or suspecting that the effect of the relationship is such as to cause the producer 
concerned to behave differently  from non-related producers."    
25. The definition of the term "related" in existi ng footnote 11 focuses on the degree of "control" 
one entity has over another (directly or indirectly co ntrol, be controlled by another party or be under 
common control of a third party).  However, the Agreement offers no guidance regarding the meaning 
of the term "control", and Members seem to have adopted conflicting practices. 
26. It is important that only those domestic producers that are being controlled to such an extent 
as to cause the domestic producer to behave differe ntly from non-related producers are excluded.  To 
ensure against exclusions based on ownership shares that are too small to entail such influence or 
control, we suggest to clarify in footnote 11 that related parties are only those where company A owns 
or controls more than half of the voting stock of company B. 
27. Textual proposals are included in the Annex. 
 
 
                                                      
 3 Such an increase was previously proposed inter alia in TN/RL/GEN/69 and TN/RL/GEN/103. 
 4 Renumbered as footnote 16 in the Chair's text.  TN/RL/W/230 
 Page 5 
 
 
  ANNEX  
 
A. Changes to Article 4 
 
Article 4.1 in the Chair's text in TN/RL/W/213 to be amended as follows:  
 
4.1 For the purposes of this Agreement, and except to the extent otherwise provided in 
Article 5.4, the term "domestic industry" shall be interp reted as referring to the domestic producers as 
a whole of the like products or to those of them whose collective output of the products constitutes a major proportion of the total domestic production of those products, except that: 
 
(i)
 when producers are related5 to the exporters or importers or are themselves impor ters 
of the product under consideration, the term  "domestic industry" may be interpreted 
as referring to the rest of the producers6,7 ; 
 
(i) in exceptional circumstances the territory  of a Member may, for the production in 
question, be divided into two or more competitive markets and the producers within 
each market may be regarded as a separate industry if (a) the producers within such 
market sell all or almost all of their production of the product in question in that market, and (b) the demand in that market is not to any substantial degree supplied by 
producers of the product in question located elsewhere in the territory.  In such 
circumstances, injury may be found to exis t even where a major portion of the total 
domestic industry is not injured, provided th ere is a concentration of dumped imports 
into such an isolated market and provided further that the dumped imports are causing 
injury to the producers of all or almost all of the production within such market. 
 B. Changes to Article 5 
 
Article 5.4 in the Chair's text in TN/RL/W/213 to be amended as follows:
 
 5.4 An investigation shall not be initiated pur suant to paragraph 1 unless the authorities have 
determined, on the basis of an examination of the degree of support for, or opposition to, the 
application expressed
8 by domestic producers of the like product, that the application has been made 
by or on behalf of the domestic industry.9  The application shall be cons idered to have been made "by 
or on behalf of the domestic industry" if it is expressly supported by those domestic producers whose 
collective output constitutes more than 50 per cent of the total production of the like product.10 
produced by that portion of the domestic industry expressing either support fo r or opposition to the 
application .  However, no investigation shall be initiated when domestic producers expressly 
supporting the application account for less than 25  per cent of total production of the like product 
produced by the domestic industry.    
                                                      
 
  
8 Original footnote 22:   In the case of fragmented industries involving an exceptionally large number of 
producers, authorities may determine support and oppos ition by using statistically valid sampling techniques. 
9 Original footnote 23:   Members are aware that in the terr itory of certain Members employees of 
domestic producers of the like product or representatives of those employees may make or support an 
application for an investigation under paragraph 1. 
10  Where the application is filed or  supported by an industry association, support for the application 
shall be calculated based on the volume of production of those members of the association expressly supporting 
the application, except that where the association represents an excep tionally large number of producers, 
statistically valid sampling techniques may be applied to estimate the level of support within the membership of 
the association.  TN/RL/W/230 
Page 6  
 
  (i) 
For the purpose of this paragraph, th e 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)
.   
(ii) When producers are related11 to the exporters or importers or are themselves 
importers of the product under considera tion, the term "domestic industry", 
for purposes of this paragraph, may be interpreted as referring to the rest of 
the producers.12,13    
 
__________ 
 
                                                      
11 Original footnote 11 (to Article 4.1 – renumbered 16 in the Chair's text:   For the purpose of this 
paragraph, producers shall be deemed to be related to exporters or importers only if (a) one of them directly or 
indirectly controls the other;  or  (b) both of them are directly or indirectly controlled by a third person;  or 
(c) together they directly or indirectly control a third person, provided that there are grounds for believing or 
suspecting that the effect of  the relationship is such as to cause the producer concerned to behave differently 
from non-related producers.  For the purpose of this paragraph, one shall be deemed to control another when the 
former is legally or operationally in a position to exerci se restraint or direction over the latter, for example by 
controlling more than half of the voting stock of the other producer . 
12 [Footnote 17 as proposed by the Chair]  In determining whether to exclude a producer from the 
domestic industry in cases where that producer is itself an importer of the product under consideration, the 
authorities shall consider, inter alia , the extent of that producer's imports of  that product relative to its total sales 
of the domestic like product in the market of the importing country and the range of the allegedly dumped goods 
imported by that producer relative to the range of its domestic production and sales of the like product.  
Evidence that the producer's imports of the allegedly dumpe d product are small relative to its total sales of the 
domestic like product in the market of the importing country or that the goods imported by that producer 
represent a limited number of models relative to the range of models of the domestic like product produced and 
sold domestically by the producer would normally favour a conclusion that the producer should not be excluded from the domestic industry.  
13 [Footnote 18 as proposed by the Chair]  The reasons underlying any decision by the authorities to 
exclude from the domestic industry producers that are related to the exporters or importers or are themselves importers of the allegedly dumped product shall be set fo rth in the relevant public notices or separate reports 
required by Article 12.