WORLD TRADE  
ORGANIZATION  G/ADP/IG/W/52 
8 March 2007 
 (07-0955) 
Committee on Anti-Dumping Practices 
Informal Group on Anti-Circumvention Original:   English 
 
 
 
"BUNDLING" OF INVOICES TO CIRCUMVENT ANTI-DUMPING DUTIES  
AND PRICE UNDERTAKINGS 
 
Paper from New Zealand  
 
  The following communication, dated 6 March 2007, is being circulated at the request of the Delegation of New Zealand
. 
 
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Background 
 
Trade remedy measures in the form of an ti-dumping duties or the acceptance of an 
undertaking can be applied when an administering au thority has established, after an investigation, 
that dumped imports have caused material injury or th reatened material injury to a domestic industry.  
Such duties can take several forms and are applied in  order to offset the effects of those injurious 
imports.  If, however, exporters and importers circum vent such determinations and avoid paying any 
duties that have been levied then  the measure is rendered ineffective and the impact of the dumping 
will continue. 
Types of Measures  
 
Anti-dumping duties can be applied in a number of ways and can be imposed as a rate or 
amount, including any rate or amount established by a formula.  The basic approaches are:   
• A specific amount per unit of product;   
• An ad valorem  rate;   
• A reference price approach;  or 
• A price undertaking. 
 
In deciding the form of measure, considerations  relating to the ease of administration, ability 
to ensure the dumping margin is not exceeded, fairn ess between parties and predictability need to be 
taken into account and in the case of a price undertak ing, the number of actual or potential exporters 
and matters of general policy.   
New Zealand has a prospective system for whic h the duty payable is the difference between 
the transaction price and the reference price.  Th e reference price would normally be based on the 
normal value established in an investigation and generally represents the un-dumped value of the 
goods at the FOB level.  Such a system allows the exporter to "price up" to the reference price, hence 
the importer does not have to pay any anti-dumping duty. 
 G/ADP/IG/W/52 
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  Undermining Reference Duties or Undertakings by "Bundling" an Invoice 
 
It could be argued that reference price duties and price undertakings can easily be avoided by 
"bundling" an invoice i.e. overstating the transactio n price (value for duty) on the goods that are 
subject to the anti-dumping measure and unders tating by the corresponding amount the transaction 
price for another line of goods on the invoice that an exporter is supplying to the same importer.  In 
such circumstances the importer pays exactly the same amount for the two lines of goods but avoids 
anti-dumping duties that may be payable or in the ca se of a reference price or an undertaking "on the 
face of it" meets an agreed commitment.  A simple example of this is as follows:   
INVOICE VALUES BEFORE A MEASURE 
IS IMPOSED INVOICE VALUES AFTER A MEASURE  
IS IMPOSED 
 Transaction Price  Transaction Price 
Product subject to 
investigation $200.00 Product dumped and 
reference or undertaking price set $225.00 
Product not subject to 
investigation $150.00 Product not subject to 
investigation $125.00 
Total of Invoice $350.00 Total of Invoice $350.00 
 
Simply by altering the pricing of goods supplied to the same importer the exporter has 
allowed the importer to avoid any anti-dumping duty th at would be payable if it continued to invoice 
at the "dumped" price.  It also appears that any reference price or undertaking has been met.  The 
exporter will still receive the same amount of m oney on the total invoice which it can then allocate 
across the two product lines in its accounts as it sees f it.  Similarly "on face" it has met any reference 
price or price undertaking that it has entered into unless an investigating authority has the resources to 
verify pricing information and allocation in its acc ounts at a later stage.  A comprehensive monitoring 
scheme would be required to enable an authority to be aware of, and take action against, these 
practices. 
The key questions are, therefore:   
• How do you identify if such practices are occurring? 
• Is there anything that can be done  to prevent such a practice? 
• What action can be taken if such a practice is discovered? 
 
Framework for Discussion on Circumvention  
Members will recall that the agreed framework for discussions on circumvention was laid out 
in WTO Document G/ADP/W/404 of 20 March 1997.  That paper outlined three broad areas and 
several questions to assist discussions on this topi c.  New Zealand invites Members of the group to 
consider the circumstances it has ou tlined and, in considering what action may be taken, answer the 
questions posed in that paper, specifically:   
• Does the "bundling" of an invoice constitute circumvention? 
• Has any other Member been confronted by such a situation and if so do they 
consider it to be circumvention? 
• To what extent can the bundling of in voices be dealt with under relevant WTO 
rules? 
• To what extent can it not?  and 
• What other options may be deemed n ecessary to deal with this problem. 
  G/ADP/IG/W/52 
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  New Zealand believes that such a discussion and the sharing of other member’s experiences 
and practice in this regard would be useful to further understanding the different forms of 
circumvention that need to be identified and dealt with. 
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