WORLD TRADE  
ORGANIZATION  TN/RL/W/236 
19 December 2008 
 (08-6255) 
Negotiating Group on Rules  
  
 
NEW DRAFT CONSOLIDATED CHAIR TEXTS OF THE  
AD AND SCM AGREEMENTS 
  
 As foreshadowed in past Reports to the Trad e Negotiations Committee, I am today circulating 
to all participants new draft texts on anti-dumpi ng and on horizontal subsidies, as well as a specific 
roadmap on fisheries subsidies.   As reflected in my Report of July 2008, and ag ain confirmed in my bilateral consultations last 
month, the clear message I received from delegations  is that my new texts should reflect a new, 
bottom-up approach.  This coincides with my ow n assessment that at the present time I lack an 
adequate basis to propose a new balance, and that we must look to Members, rath er than to the Chair, 
to move our work forward.  As I stated very clear ly in July, and the situation has not changed since 
that time, it should not be expected that my new te xts will offer any magic solutions in the many areas 
where Members' positions differ dramatically and where the alternatives remain as delegations 
originally tabled them, i.e., very far apart.    
 
 Thus, it will come as no surprise to delegations that these new texts reflect such a bottom-up approach and provide draft legal language only in those areas where some  degree of convergence 
appears to exist.  In respect of a number of impor tant issues I do not, consistent with such an 
approach, have a basis to propose compromise soluti ons, much less specific drafting language.  In 
these instances, I have identified the issue in brac kets and have attempted to summarize in general 
terms the range of views expressed regarding it.  Obviously, these summaries are not comprehensive: 
for a more detailed statement of Members’ positi ons, I would refer delegations to the Working 
Document dated 28 May 2008 (TN/RL/W/232) and to  underlying submissions by delegations.  As 
will be clear from the summaries, we will of course need to discuss these brack eted issues intensively 
if we are to find solutions. 
 
 It should be obvious from these texts that a great deal of work remains to be done in order to 
ensure that we have Rules texts reflecting the gr eatest convergence possible.  Not only are there large 
gaps where on issues of great importance to delegatio ns no solutions are proposed;  but few, if any, of 
the textual proposals that can be found in these ne w texts can be considered to attract consensus 
support. 
  On fisheries subsidies, as envisaged in my Repor t of July 2008, instead of a new draft text I 
am tabling a roadmap for our further discussions, as in this area the situation is of a different nature.  
The Group is mandated to strengthen disciplines on subs idies in the fisheries se ctor, including through 
the prohibition of certain forms of fisheries subsid ies that contribute to overcapacity and over-fishing, 
while formulating appropriate and effective spec ial and differential treatment that addresses the 
interests and concerns of developing Members.  Ye t, we have no pre-existi ng agreement to which to 
revert, and the differences among delegations go to th e very concepts and structure of the rules.  I 
believe that further discussion is necessary to provid e the essential input for a new draft text that could 
meet these two important objectives.  To this end,  the roadmap identifies the key questions that we 
need to address in order to reconcile the appr oaches and advance our work in this area.   
 TN/RL/W/236 
Page 2  
 
   I am circulating these documents in order to provide a platform for further discussions, and it 
is my intention to provide ample opportunity for such discussions through an intensive programme of 
meetings beginning early next year.  Whether we can now move forward and make progress on the 
basis of these documents depends primarily on the collective commitment and flexibility of delegations. 
 
_______________  TN/RL/W/236 
 Page 3 
 
 
  AGREEMENT ON IMPLEMENTATION OF ARTICLE VI  
OF THE GENERAL AGREEMENT ON TARIFFS AND TRADE 1994  
 
 Members hereby agree  as follows: 
 
 
PART I 
 
Article 1  
 
Principles  
 
 An anti-dumping measure shall be applied on ly under the circumstances provided for in 
Article VI of  GATT 1994 and pursu ant to investigations initiated
1 and conducted in accordance with 
the provisions of this Agreement.  The following provisions govern the application of Article VI of 
GATT 1994 in so far as action is taken under anti-dumping legislation or regulations. 
  
Article 2  
 
Determination of Dumping  
 
2.1 For the purpose of this Agreement, a product is to be considered as being dumped, i.e.  
introduced into the commerce of another country at less than its normal value, if the export price of 
the product exported from one country to another is l ess than the comparable price, in the ordinary 
course of trade, for the like product when destin ed for consumption in the exporting country. 
 2.2 When there are no sales of the like product in the ordinary course of trade in the domestic 
market of the exporting country or when, because of the particular market situation or the low volume of the sales in the domestic market of the exporting country
2, such sales do not permit a proper 
comparison, the margin of dumping shall be determined by comparison with a comparable price of 
the like product when exported to an appropriate third country, provided that this price is 
representative, or with the cost of production in the country of origin plus a reasonable amount for 
administrative, selling and general costs and for profits.      2.2.1 Sales of the like product in the dom estic market of the exporting country or 
sales to a third country at prices below per unit (fixed and variable) costs of 
production plus  administrative, selling and general costs may be treated as 
not being in the ordinary course of trade by reason of price and may be 
disregarded in determining normal value only if the authorities
3 determine 
that such sales are made within an extended period of time4 in substantial 
                                                      
1 The term "initiated" as used in this Agreement means the procedural action by which a Member 
formally commences an investigation as provided in Article 5. 
2 Sales of the like product destined for consumpti on in the domestic market of the exporting country 
shall normally be considered a sufficient quantity for the determination of the normal value if such sales 
constitute 5 per cent or more of the sales of the produc t under consideration to the importing Member, provided 
that a lower ratio should be acceptable where the evidence demonstrates that  domestic sales at such lower ratio 
are nonetheless of sufficient magnitude to provide for a proper comparison. 
3 When in this Agreement the term "authorities" is used, it shall be interpreted as meaning authorities at 
an appropriate senior level. 
4 The extended period of time should normally be one year but shall in no case be less than six months. TN/RL/W/236 
Page 4  
 
  quantities
5 and are at prices which do not provide for the recovery of all costs 
within a reasonable period of time.  If prices which are below per unit costs at 
the time of sale are above weighted average per unit costs for the period of 
investigation, such prices shall be cons idered to provide for recovery of costs 
within a reasonable period of time. 
 
  2.2.1.1 For the purpose of paragraph 2, costs shall normally be 
calculated on the basis of records kept by the exporter or producer 
under investigation, provided that such records ar e in accordance 
with the generally accepted accounting principles of the exporting 
country and reasonably reflect the costs associated with the 
production and sale of the product und er consideration.  Authorities 
shall consider all available evidence on the proper allocation of costs, including that which is made available by the exporter or producer in the course of the investigation, giving due regard to any cost
  
provided that such allocations have been historically utilized by the 
exporter or  producer, in particular in relation to establishing appropriate amortization and depreci ation periods and allowances for 
capital expenditures and other development costs.  Unless already reflected in the cost allocations unde r this sub-paragraph, costs shall 
be adjusted appropriately for those non-recurring items of cost which 
benefit future and/or current pr oduction, or for circumstances in 
which costs during the period of investigation are affected by start-up operations.
6 
 
2.2.2 For the purpose of paragraph 2, the amounts for administrative, selling and 
general costs and for profits shall be based on actual data pertaining to 
production and sales in the ordinary course of trade of the like product by the exporter or producer under investigation.  When such amounts cannot be determined on this basis, the amounts may be determined on the basis of: 
 
 (i) the actual amounts incurred and realized by the exporter or 
producer in question in respect of production and sales in the 
domestic market of the country of  origin of the same general 
category of products;   
 
 (ii) the weighted average of the actual amounts incurred and 
realized by other exporters or producers subject to 
investigation in respect of production and sales of the like product in the domestic market of the country of origin;   
 
 (iii) any other reasonable method, provided that the amount for 
profit so established shall not exceed the profit normally 
realized by other exporters or producers on sales of products 
                                                     
 
5 Sales below per unit costs are made in substantial quantities when the authorities establish that the 
weighted average selling price of the transactions under consideration for the determination of the normal value 
is below the weighted average per unit costs, or that th e volume of sales below per unit costs represents not less 
than 20 per cent of the volume sold in transactions under consideration for the determination of the normal 
value. 
6 The adjustment made for start-up op erations shall reflect the costs at the end of the start-up period or, 
if that period extends beyond the period of investigation, the most recent costs which can reasonably be taken 
into account by the authorities during the investigation.  TN/RL/W/236 
 Page 5 
 
 
  of the same general category in  the domestic market of the 
country of origin. 
 
2.3 In cases where there is no export price or wh ere it appears to the authorities concerned that 
the export price is unreliable because of association or a compensatory arrangement between the 
exporter and the importer or a third party, the export price may be constructed on the basis of the price 
at which the imported products are first resold to an independent buyer, or if the products are not 
resold to an independent buyer, or not resold in the condition as imported, on such reasonable basis as 
the authorities may determine.  
2.4 A fair comparison shall be made between the export price and the normal value.  This 
comparison shall be made at the same level of trade, normally at the ex-factory level, and in respect of 
sales made at as nearly as possible the same time.  Due allowance shall be made in each case, on its 
merits, for  differences which affect price compar ability, including differences in conditions and terms 
of sale, taxation, levels of trade, quantities, ph ysical characteristics, and any other differences which 
are also demonstrated to affect price comparability.
7  In the cases referred to in paragraph 3, 
allowances for costs, including duties and taxes,  incurred between importation and resale, and for 
profits accruing, should also be made.  If in these cases price comparability has been affected, the 
authorities shall establish the normal value at a level of  trade equivalent to the level of trade of the 
constructed export price, or shall make due a llowance as warranted under this paragraph.  The 
authorities shall indicate to the parties in question what information is necessary to ensure a fair 
comparison and shall not impose an unreasonable burden of proof on those parties. 
 
2.4.1 When the comparison under paragraph 4 requires a conversion of currencies, 
such conversion should be made using th e rate of exchange on the date of 
sale8 taken from a source of recognized authority9, provided that when a sale 
of foreign currency on forward markets is directly linked to the export sale 
involved, the rate of exchange in the fo rward sale shall be used.  Fluctuations 
in exchange rates shall be ignored and in an investigation the authorities shall 
allow exporters at least 60 days to have adjusted their export prices to reflect sustained movements in exchange rates during the period of investigation. 
  
   2.4.1.1 The source of recognized authority normally used, and the 
specific method normally followed by the authorities in applying 
subparagraph 4.1, shall be set fo rth in the laws, regulations or 
publicly available administrative procedures of the Member 
concerned, and their application to each particular case shall be 
transparent and adequately explained.  
    2.4.1.2 If, in a particular case, a Member does not use the source of 
recognized authority or specific method set forth in its laws, 
regulations or publicly available administrative procedures, it shall 
explain in the relevant public notices or separate report under 
Article 12 why it did not use such source or method.    
 
                                                      
7 It is understood that some of the above factors may overlap, and authorities shall ensure that they do 
not duplicate adjustments that have been already made under this provision. 
8 Normally, the date of sale would be the date of contract, purchase order, order confirmation, or 
invoice, whichever establishes the material terms of sale.    
9 Sources of recognized authority may include centra l banks, multilateral financial institutions, widely 
distributed financial journals, or other sources not created primarily for the purpose of conducting anti-dumping, 
countervailing or sa feguard proceedings.  TN/RL/W/236 
Page 6  
 
  2.4.2 Subject to the provisions governing fair comparison in paragraph 4, the 
existence of margins of dumping du ring the investigation phase shall 
normally be established on the basis of a comparison of a weighted average normal value with a weighted average of prices of all comparable export 
transactions or by a comparison of normal value and export prices on a 
transaction-to-transaction basis.  A normal value established on a weighted 
average basis may be compared to prices of individual export transactions if the authorities find a pattern of export prices which differ significantly among different purchasers, regions or time periods, and if an explanation is 
provided as to why such  differe nces cannot be taken into account 
appropriately by the use of a weight ed average-to-weighted average or 
transaction-to-transaction comparison. 
 
[ZEROING:  Delegations remain profoundly divided on this issue.  Positions range from 
insistence on a total prohibition of zeroin g irrespective of the comparison methodology 
used and in respect of all proceedings to a demand that zeroing be specifically 
authorized in all contexts.] 
 
2.4.3 When there are differences within th e product under consideration, such as 
different models, types, grades or technical specifications, the authorities shall 
provide exporters and foreign produ cers with timely opportunities to express 
their views regarding possible categorization and matching for purposes of 
comparison.  This shall not prevent the authorities from proceeding 
expeditiously with the investigation.  
 2.5 In the case where products are not imported directly from the country of origin but are 
exported to the importing Member from an intermedia te country, the price at which the products are 
sold from the country of export to the importing Member shall normally be compared with the comparable price in the country of export.  Howeve r, comparison may be made with the price in the 
country of origin, if, for example, the products are merely transshipped through the country of export, 
or such products are not produced in the country of e xport, or there is no comparable price for them in 
the country of export. 
 
2.6 Throughout this Agreement the term "like pr oduct" ("produit similaire") shall be interpreted 
to mean a product which is identical , i.e. alike in all respects to the product under consideration, or in 
the absence of such a product, another product which, although not alike in all respects, has characteristics closely resembling those of the product under consideration. 
 
2.7 This Article is without prejudice to the se cond Supplementary Provision to paragraph 1 of 
Article VI in Annex I to GATT 1994.   
Article 3  
 
Determination of Injury
10 
 3.1 A determination of injury for purposes of Ar ticle VI of GATT 1994 shall be based on positive 
evidence and involve an objective examination of both (a) the volume of the dumped imports
11 and 
                                                      
10 Under this Agreement the term "injury" shall, unless otherwise specified, be taken to mean material 
injury to a domestic industry, threat of material injury to a domestic industry or material retardation of the 
establishment of such an industry an d shall be interpreted in accordance wi th the provisions of this Article.  TN/RL/W/236 
 Page 7 
 
 
  the effect of the dumped imports on prices in  the domestic market for like products, and (b) the 
consequent impact of these imports on domestic producers of such products. 
 3.2 With regard to the volume of the dumped im ports, the investigating authorities shall consider 
whether there has been a significant increase in dumped imports, either in absolute terms or relative to 
production or consumption in the importing Member.   With regard to the effect of the dumped  
imports on prices, the investigating authorities sha ll consider whether there has been a significant 
price undercutting by the dumped imports as compar ed with the price of a like product of the 
importing Member, or whether the effect of such imports is otherwise to depress prices to a significant degree  or prevent price increases, which otherwise would have occurred, to a significant degree.  No 
one or several of these factors can necessarily give decisive guidance. 
 3.3 Where imports of a product from more than one country are simultaneously subject to anti-dumping investigations, the investigating auth orities may cumulatively assess the effects of such 
imports only if they determine that (a) the margin of dumping established in relation to the imports 
from each country is more than de minimis  as defined in paragraph 8 of Article 5 and the volume of 
imports from each country is not negligible and (b) a cumulative assessment of the effects of the 
imports is appropriate in light of  the conditions of competition betw een the imported products and the 
conditions of competition between the importe d products and the like domestic product. 
 3.4 The examination of the impact of the dumped imports on the domestic industry concerned 
shall include an evaluation of all relevant economic  factors and indices having a bearing on the state 
of the industry, including actual and potential d ecline in sales, profits, output, market share, 
productivity, return on investments, or utilization of capacity;  factors affecting domestic prices;  the 
magnitude of the margin of dumping;  actual and potential negative effects on cash flow, inventories, 
employment, wages, growth, ability to raise capital or investments.  This list is not exhaustive, nor can 
one or several of these factors necessarily give decisive guidance. 
 3.5 It must be demonstrated that the dumped im ports are, through the effects of dumping, as set 
forth in paragraphs 2 and 4, causing injury within the meaning of this Agreement.  The demonstration 
of a causal relationship between the dumped imports and the injury to the domestic industry shall be 
based on an examination of all relevant evidence be fore the authorities.  The authorities shall also 
examine any known factors other than the dumped im ports which at the same time are injuring the 
domestic industry, and the injuries caused by these other factors must not be attributed to the dumped imports.  Factors which may be relevant in this respect include, inter alia , the volume and prices of 
imports not sold at dumping prices, contraction in demand or changes in the patterns of consumption, trade restrictive practices of and competiti on between the foreign and domestic producers, 
developments in technology and the export perfo rmance and productivity of the domestic industry. 
 
[CAUSATION OF INJURY:  Delegations main tain a wide range of views on such 
questions as whether it should be mandatory  to separate and distinguish the effects of 
dumped imports and other factors, the extent to which authorities should be required to conduct a quantitative (as opposed to qualitative) analysis of non-attribution, and the 
extent to which authorities should be required to weigh the injurious effects of dumped 
imports against the effects of other factors.] 
 
3.6 The effect of the dumped imports shall be assessed in relation to the domestic production of 
the like product when available data permit the sep arate identification of that production on the basis 
of such criteria as the production process, producers' sales and profits.  If such separate identification 
                                                                                                                                                                    
 
11 For purposes of a determination of injury under th is Article, imports attribut able to any exporter or 
producer for which the authorities determine a margin of dumping of zero or de minimis  shall not be considered 
to be "dumped imports".  TN/RL/W/236 
Page 8  
 
  of that production is not possible, the effects of the dumped imports shall be assessed by the 
examination of the production of the narrowest gr oup or range of products, which includes the like 
product, for which the necessary information can be provided.  3.7 A determination of a threat of material in jury shall be based on facts and not merely on 
allegation, conjecture or remote possibility.  Th e change in circumstances which would create a 
situation in which the dumping would cause injury must be clearly foreseen and imminent.
12  I n  
making a determination regarding the existence of a threat of material injury, the authorities shall 
consider the state of the domestic industry during the period of investigation, including an 
examination of the impact of dumped imports upon it in accordance with paragraph 4, in order to 
establish a background for the evaluation of threat of  material injury.  In addition, the authorities 
should consider, inter alia , such factors as: 
 
(i) a significant rate of increase of dumped imports into the domestic market indicating 
the likelihood of substantially increased importation; 
 
(ii) sufficient freely disposable, or an immi nent, substantial increase in, capacity of the 
exporter indicating the likelihood of substan tially increased dumped exports to the 
importing Member's market, taking into account available evidence concerning  the 
availability of other export markets to absorb any additional exports; 
 
(iii) whether imports are entering at prices that will have a significant depressing or  
suppressing effect on domestic prices, and would likely increase demand for further 
imports;  and 
 
(iv) inventories of the product being investigated. 
 
No one of these factors by itself can necessarily give decisive guidance but the totality of the factors 
considered must lead to the conclusion that further dumped exports are imminent and that, unless 
protective action is taken, material injury would occur.  3.8 With respect to cases where in jury is threatened by dumped  imports, the application of 
anti-dumping measures shall be considered and decided with special care. 
 
[MATERIAL RETARDATION:  Although there is a broadly expressed view that the 
provisions of the Agreement regarding material retardation would benefit from amplification and clarification, there are wide ly varying views about how to achieve this.  
Most notably, while some delegations consider that an industry might still be in 
establishment even if there was some domest ic production, other delegations consider 
that once there is any domestic production an industry is no longer "in establishment", 
and in such cases the proper analysis is one of current injury or threat.] 
 
 
Article 4  
 
Definition of Domestic Industry  
 
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 
                                                      
12 One example, though not an  exclusive one, is that there is convincing reason to believe that there will 
be, in the near future, substantially increased importation of the product at dumped prices.  TN/RL/W/236 
 Page 9 
 
 
  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 related
13 to the exporters or importers  or are themselves importers 
of the allegedly dumped product, the term "d omestic industry" may be interpreted as 
referring to the rest of the producers14 ; 
 (ii) in exceptional circumstances the territo ry 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. 
 
[EXCLUSION OF PRODUCERS WHO ARE RELATED TO EXPORTERS OR 
IMPORTERS OR WHO ARE THEMSELVES IMPORTERS:  There are widely 
varying views about the need for criteria gov erning this exclusion, and about the nature 
of any possible criteria.  In particular, some delegations consider that the rules should 
be precise, reflecting numerical criteria, and directive in nature.  Other delegations believe that any criteria should not be too prescriptive, as the assessment must be case by case.] 
 4.2 When the domestic industry has been interp reted as referring to the producers in a certain 
area, i.e. a market as defined in paragraph 1(ii), anti-dumping duties shall be levied
15 only on the 
products in question consigned for fi nal consumption to that area.  When the constitutional law of the 
importing Member does not permit the levying of an ti-dumping duties on such a basis, the importing 
Member may levy the anti-dumping duties without limitation only if (a) the exporters shall have been 
given an opportunity to cease exporting at dumped prices to the area concerned or otherwise give 
assurances pursuant to Article 8 and adequate assurances in this regard have not been promptly given, 
and (b) such duties cannot be levied only on products  of specific producers which supply the area in 
question.  4.3 Where two or more countries have reached  under the provisions of paragraph 8(a) of 
Article XXIV of GATT 1994 such a level of integrati on that they have the characteristics of a single, 
unified market, the industry in the entire area of in tegration shall be taken to  be the domestic industry 
referred to in paragraph 1.  
                                                     
 
13 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 exercise restraint or 
direction over the latter. 
14 The reasons underlying any decision by the au thorities 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 explained in the relevant public notices or separate reports required by Article 12.  
15 As used in this Agreement "levy" shall mean the definitive or final legal assessment or collection of a 
duty or tax. TN/RL/W/236 
Page 10  
 
  4.4 The provisions of paragraph 6 of Article  3 shall be applicable to this Article. 
 
Article 5  
 
Initiation and Subsequent Investigation  
 
5.1 Except as provided for in paragraph 6, an inv estigation to determine the existence, degree and 
effect of any alleged dumping sh all be initiated upon a written appli cation by or on behalf of the 
domestic industry.  
5.2 An application under paragraph 1 shall include evidence of (a) dumping, (b) injury within the 
meaning of Article VI of GATT 1994 as interpreted by this Agreement and (c) a causal link between 
the dumped imports and the alleged injury.  Simple  assertion, unsubstantiated by relevant evidence, 
cannot be considered sufficient to meet the require ments of this paragraph.  The application shall 
contain such information as is reasonably av ailable to the applicant on the following: 
 
(i) (a) 
the identity of the applicant and the domestic industry by or on behalf of which 
the application is made and, where the applicant is itself a producer, a description of 
the volume and value of the domestic production of the like product by the applicant; .  
Where a written application is made on behalf of the domestic industry, the 
application shall identify the industry on  behalf of which the application is made by a 
list of all known domestic producers of the like product (or associations of domestic 
producers of the like product) (b) the identity of those producer s (or, to the extent this 
is not practicable in the case of fragmente d industries, associations of domestic 
producers of the like product) supporting the application, and, to the extent possible, a 
description of  the volume and value of domestic production of the like product 
accounted for by those such producers or associations of producers ;  and (c) the 
identity of all known domestic producers of the like product (or, to the extent this is 
not practicable in the case of a fragmented industry, associations of domestic 
producers of the like product) and the tota l volume and value of domestic production 
of the like product;  
 
(ii) a complete description of the allegedly dumped product, the names of the country or 
countries of origin or export in question,  the identity of each known exporter or 
foreign producer and a list of known pers ons importing the product in question; 
 
(iii) information on prices at which the product in question is sold when destined for 
consumption in the domestic markets of the country or countries of origin or export 
(or, where appropriate, information on the pr ices at which the product is sold from the 
country or countries of origin or export to a third country or countries, or on the constructed value of the product) and information on export prices or, where 
appropriate, on the prices at which the product is first resold to an independent buyer 
in the territory of the importing Member
16; 
 
(iv) information on the evolution of the vo lume of the allegedly dumped imports, the 
effect of these imports on prices of the like product in the domestic market and the consequent impact of the imports on the domestic industry, as demonstrated by relevant factors and indices having a bearing on the state of the domestic industry, 
such as those listed in paragr aphs 2 and 4 of Article 3. 
 
                                                     
 
16 Including the sources of the information provided and, where relevant, the method used to derive 
prices from that information.   TN/RL/W/236 
 Page 11 
 
 
  5.3 The authorities shall examine the accuracy and adequacy of the evidence provided in the 
application17 to determine whether there is sufficien t evidence to justify the initiation of an 
investigation.  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
18 by domestic producers of the like product, that the application has been made 
by or on behalf of the domestic industry.19    The application shall be considered to have been made 
"by or on behalf of the domestic industry" if  it is supported by those domestic producers whose 
collective output constitutes more than 50 per cent of  the total production of the like product produced 
by that portion of the domestic industry expressing eith er support for 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.  For the purpose of this para graph, 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).  
 5.5 The authorities shall avoid, unless a decision has been made to initiate an investigation, any 
publicizing of the application for the initiation of an  investigation.   However, after receipt of a 
properly documented application and no later than 15 days before initiating 
before proceeding to 
initiate  an investigation, the authorities shall no tify the government of the exporting Member 
concerned and shall provide it with the full text of  the written application, paying due regard to the 
requirement for the protection of confidential inform ation as provided for in paragraph 5 of Article 6 . 
 5.6 If, in special circumstances,  the authorities concerned decide to initiate an investigation 
without having received a written application by or on behalf of a domestic industry for the initiation 
of such investigation, they shall proceed only if they have sufficient evidence of dumping, injury and 
a causal link, as described in paragraph 2, to  justify the initiation of an investigation. 
 
[PRODUCT UNDER CONSIDERATION: While many delegations consider that a 
provision on this issue would be useful, concerns have been expressed that such a provision might be unnecessary, could create mo re problems than it purports to solve, 
and could have "vertical" as well as "horizonta l" implications (e.g., with respect to the 
inclusion of parts), as well as implications in respect of subsequent proceedings.  There 
are also differences of view regarding, inter alia, how broadly the product under 
consideration should be defined, the role of physical and market characteristics in determining the product under consideration, and when and how product under 
consideration should be determined.] 
 
5.7 The evidence of both dumping and injury shall be considered simultaneously (a) in the 
decision whether or not to initiate an investigation, and (b) thereafter, during the course of the 
investigation, starting on a date not later than the earliest date on which in accordance with the 
provisions of this Agreement prov isional measures may be applied. 
 
                                                     
 
17 The authorities shall, in particular, consult so urces readily available to them, such as trade 
associations, publications and public records, with a view to identifying any domestic producers of the like 
product not identified in the application.    
18 In the case of fragmented industries involving  an exceptionally large number of producers, 
authorities may determine support and opposition by using statistically valid sampling techniques. 
19 Members are aware that in the te rritory 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. TN/RL/W/236 
Page 12  
 
  5.8 An application under paragraph 1 shall be reje cted and an investigation shall be terminated 
promptly as soon as the authorities concerned are satis fied that there is not sufficient evidence of 
either dumping or of injury to justify proceeding w ith the case.  There shall be immediate termination 
in cases where the authorities determine that the margin of dumping is  de minimis , or that the volume 
of dumped imports, actual or potential, or the injury, is negligible.  The margin of dumping shall be 
considered to be de minimis  if this margin is less than 2 per cent, expressed as a percentage of the 
export price.  The volume of dumped imports shall normally be regarded as negligible if the volume 
of dumped imports from a particular country is fou nd to account for less than 3 per cent of imports of 
the like product in the importing Member, unless c ountries which individually account for less than 
3 per cent of the imports of the like product in the importing Member collectively account for more 
than 7 per cent of imports of the like product in the importing Member. 
 5.9 An anti-dumping proceeding shall not hinde r the procedures of customs clearance. 
 5.10 Investigations shall, except in special circumstances, be concluded within one year, and in no 
case more than 18 months, after their initiation. 
 5.10bis Except where circumstances have changed, the authorities shall not initiate an investigation 
where a previous investigation of the same product from the same Member ini tiated pursuant to this 
Article resulted in a negative final determination within one year prior to the filing of the application.  
If an investigation is initiated in such a case, the authorities shall explain the change in circumstances 
which warrants initiation in the notice of initiation or separate report provided for in Article 12.1.  
  
Article 6  
 
Evidence  
 
6.1 All interested parties in an anti-dumping inves tigation shall be given notice of the information 
which the authorities require and ample opportunity to present in writing all evidence which they consider relevant in respect of the investigation in question.   
 
 6.1.1 new The authorities shall consult sources read ily available to them, such as trade 
associations, publications and public reco rds, with a view to identifying any 
exporters or foreign producers of th e allegedly dumped product not identified 
in the application.  
 
 6.1.1 Exporters or foreign producers receiving questionnaires used in an 
anti-dumping  investigation shall be given at least 30 days for reply.20,21  Due 
consideration should be  given to any request for an extension of the 30-day 
period and, upon cause shown, such an ex tension should be granted whenever 
practicable. 
 
                                                      
20 It is desirable that the authorities not require certif ication of translations by official translators.  
Where such certification is required, exporters or foreign producers shall be given an additional seven days for 
reply.   
21 As a general rule, the time-limit for exporters sh all be counted from the date of receipt of the 
questionnaire, which for this purpose sh all be deemed to have been receive d one week from the date on which it 
was sent to the respondent or transmitted to the appropriate diplomatic representative of the exporting Member or, in the case of a separate customs territory Member of the WTO, an official re presentative of the exporting 
territory.  TN/RL/W/236 
 Page 13 
 
 
   6.1.1 bis Within a reasonable period of time after the receipt of the response to a 
questionnaire, the authorities shall make a preliminary analysis of that 
response.  Any requests for clarificati on or additional information shall be 
directed to the interested party concerned in writing and in sufficient time for 
the authorities to consider timely responses thereto.  
 
6.1.2 Subject to the requirement to pr otect confidential information, evidence 
presented in  writing by one interested party shall be made available promptly to other interested parties par ticipating in the investigation. 
 
6.1.3 As soon as an investigation has been  initiated, the authorities shall provide 
the full text of the written application received under paragraph 1 of Article 5 
to the known exporters
22 and to the authorities of the exporting Member and 
shall make it available, upon request, to  other interested parties involved.  
Due regard shall be paid to the require ment for the protection of confidential 
information, as provided for in paragraph 5. 
 6.2 Throughout the anti-dumping investigation all in terested parties shall have a full opportunity 
for the defence of their interests.  To this end,  the authorities shall, on request, provide opportunities 
for all interested parties to meet those parties with  adverse interests, so that opposing views may be  
presented and rebuttal arguments offered.  Provision of such opportunities must take account of the 
need to preserve confidentiality and of the convenien ce to the parties.  There shall be no obligation on 
any party to attend a meeting, and failure to do so  shall not be prejudicial to that party's case.   
Interested parties shall also have the right, on justification, to present other information orally. 
 6.3 Oral information provided under paragraph 2 shall be taken into account by the authorities 
only in so far as it is subsequently reproduced in  writing and made available to other interested 
parties, as provided for in subparagraph 1.2.  6.4 The authorities shall whenever practicable
 provide timely  opportunities for all interested 
parties to see promptly all informati on that is relevant to the presentation of their cases, that is non t 
confidential information as defined in paragraph  5, and that is used by submitted to or obtained by the 
authorities in an anti-dumping investigation, a nd to prepare presentations on the basis of this 
information.  6.4bis The authorities shall maintain a file containi ng all non-confidential documents submitted to or 
obtained by the authorities in an anti-dumping pro ceeding, including non-confidential summaries of 
confidential documents and any explanations pr ovided pursuant to Article 6.5.1 as to why 
summarization is not possible, and shall allow interest ed parties to review and copy the documents in 
that file upon request.  Access to this file shall be provided promptly, and, where the proceeding is 
ongoing or is subject to judicial, arbitral or admi nistrative review, within two working days of a 
request.  The non-confidential file shall be kept in an organized manner, and a complete index of all 
documents in the possession of the authorities, in cluding confidential documents, shall be included 
therein.  Each file shall include all public no tices related to that pro ceeding issued pursuant to 
Article 12, as well as separate reports issued pursuant to footnote 37 to that Article.  Each file shall be 
maintained so long as the measure to which it relate s remains in force.  The authorities shall provide 
for the copying of documents in the non-confidential  file at the reasonable expense of the person so 
                                                      
22 It being understood that, where the number of exporters involved is particularly high, the full text of 
the written application should may instead be provided only to the authorities of the exporting Member or  to the 
relevant trade association, if any.  In such cases, the authorities shall so inform the government of the exporting 
Member . TN/RL/W/236 
Page 14  
 
  requesting, or shall allow, subject to reasonable saf eguards, that person to remove the documents for 
copying elsewhere.23   
 6.5 Any information which is by nature confiden tial (for example, because its disclosure would 
be of significant competitive advantage to a competitor or because its disclosure would have a 
significantly adverse effect upon a person supplying the information or upon a person from whom that 
person acquired the information), or which is pr ovided on a confidential basis by parties to an 
investigation shall, upon good cause shown, be treated  as such by the authorities.  Such information 
shall not be disclosed without specific permission of the party submitting it.
24 
 
6.5.1 The authorities shall require interested parties providing confidential 
information to furnish non-confidentia l versions of the document containing 
the confidential information within three working days of submitting the 
original document. summaries thereof .  The non-confidential version shall be 
identical to the version containing th e confidential information, except that 
the confidential information shall be removed and replaced by a summary of 
that information These summaries shall be in sufficient detail to permit a 
reasonable understanding of the substa nce of the information submitted in 
confidence.  In exceptiona l circumstances, such parties providing confidential 
information may indicate that such information is not susceptible of 
summary.  In such exceptional circumst ances, a statement of the reasons why 
summarization is not possible must be provided. 
  6.5.2 If the authorities find that a request for confidentiality is not warranted and if 
the  supplier of the information is e ither unwilling to make the information 
public or to authorize its disclosure in generalized or summary form, the 
authorities may disregard such information unless it can be demonstrated to 
their satisfaction from appropriate sources that the information is correct.
25 
 6.6 Except in circumstances provided for in paragr aph 8, the authorities shall during the course of 
an investigation satisfy themselves as to the accuracy  of the information supplied by interested parties 
upon which their findings are based. 
 
6.7 In order to verify information provided or to obtain further details, the authorities may carry 
out investigations in the territory of other Members as required, provided they obtain the agreement of 
the firms concerned and notify the representatives of the government of the Member in question, and 
unless that Member objects to the investigation.  Th e procedures described in Annex I shall apply to 
investigations carried out in the territory of othe r Members.  Subject to the requirement to protect 
confidential information, the authorities shall make the results of any such investigations available, or 
shall provide disclosure thereof pursu ant to paragraph  9, to the firms to which they pertain and may 
make such results available to the applicants.  
 6.8 In cases in which any interested party re fuses access to, or otherwise does not provide, 
necessary information within a reasonable period or significantly impedes the investigation, 
preliminary and final determinations , affirmative or negative, may be made on the basis of the facts 
available.  The provisions of Annex II shall be observed in the application of this paragraph. 
 
                                                     
 
23 The requirements of this paragraph may be me t by making such non-confidential documents and 
indices available via the internet.  
24 Members are aware that in the te rritory of certain Members disclosure pursuant to a narrowly-drawn 
protective order may be required. 
25 Members agree that requests for confidentia lity should not be arbitrarily rejected.    TN/RL/W/236 
 Page 15 
 
 
  [INFORMATION REQUESTS TO AFFILIATED  PARTIES: Some delegations support 
the inclusion in the text of language to en sure that interested parties are not treated as 
non-cooperative if they fail to provide info rmation from affiliates that they did not 
control.  Other delegations are concerned that such language could encourage non-
cooperation, and cautioned about an inappropriately narrow concept of control in this 
context.] 
 
6.9 The authorities shall, before a final determination is made, inform provide all interested 
parties with a written report of the essential facts under consid eration which they intend will form the 
basis for the decision whether to ap ply definitive measures.  Interested parties shall have 20 days to 
respond to this report and the authorities sh all address such responses in their final 
determination.26Such disclosure should take place in sufficient time for the parties to defend their 
interests.  
 6.9bis The authorities shall, normally within seven days after giving public notice of a final 
determination under Article 12.2, disclose to each e xporter or producer for whom an individual rate of 
duty has been determined the calculations used to determine the margin of dumping for that exporter 
or producer.27  The authorities shall provide to the exporter or producer the calculations, either in 
electronic format (such as a computer programme or  spreadsheet) or in another appropriate medium, a 
detailed explanation of the information used, the sources of that information and any adjustments 
made to the information prior to its use in the calcu lations.  The disclosure and explanation shall be in 
sufficient detail to permit the interested party to reproduce the calculations without undue difficulty.  
 6.10 The authorities shall, as a rule, determine an individual margin of dumping for each known exporter or producer concerned of the product unde r investigation.  In cases where the number of 
exporters, producers, importers or types of produc ts involved is so large as to make such a 
determination impracticable, the authorities may lim it their examination either to a reasonable number 
of interested parties or products by using samp les which are statistically valid on the basis of 
information available to the authorities at the time of  the selection, or to the largest percentage of the 
volume of the exports from the country in qu estion which can reasonably be investigated. 
 
6.10.1 Any selection of exporters, producers, importers or types of products made 
under this paragraph shall preferably 
be chosen in consultation with,  and 
preferably with the consent of,  the exporters, producers or importers 
concerned. 
 
6.10.2 In cases where the authorities have li mited their examination, as provided for 
in this paragraph, they shall neverthe less determine an individual margin of 
dumping for any exporter or producer not initially selected who submits the 
necessary information in time for that in formation to be considered during the 
course of the investigation, except where the number of exporters or producers is so large that individual examinations would be unduly burdensome to the authorities and prevent the timely completion of the 
investigation.  Voluntary res ponses shall not be discouraged. 
 6.10.3 Where the authorities limit their examin ation pursuant to this paragraph, they 
shall explain, in their public notices or  separate reports pursuant to Article 12, 
the basis for their conclusion that it was impracticable to determine an 
                                                      
26 This disclosure shall be made within sufficient time to allow an exporter to offer an undertaking in 
response.  
27 This requirement is satisfied where the authorities make such a disclosure pursuant to Article 6.9 
before the final determination is made.  TN/RL/W/236 
Page 16  
 
  individual margin of dumping for each known exporter or producer, the 
reasons for the specific selection made and the reasons why an individual 
margin was not determined for any exporter or producer not initially selected 
who submitted the necessary information in time for that information to be 
considered during the course of the investigation.  
 
6.11 For the purposes of this Agreement,  "interested parties" shall include: 
 
(i) an exporter or foreign producer or the impor ter of a product subject to investigation,  
or a trade or business association a majority  of the members of which are producers, 
exporters or importers of such product; 
 
(ii) the government of the exporting Member;  and 
 
(iii) a producer of the like product in the importing Member or a trade and business  
association a majority of the members of which produce the like product in the 
territory of the importing Member. 
 This list shall not preclude Members from allowing  domestic or foreign parties other than those 
mentioned above to be included as interested parties.  
6.12 The authorities shall provide opportunities for industrial users of the product under 
investigation, and for representative consumer orga nizations in cases where the product is commonly 
sold at the retail level, to provide information which is relevant to the investigation regarding 
dumping, injury and causality.  
6.13 The authorities shall take due account of any di fficulties experienced by interested parties, in 
particular small companies, in supplying inform ation requested, and shall provide any assistance 
practicable, including by responding in a timely ma nner to requests for clarification of questionnaires
. 
 6.14 The procedures set out above are not intende d to prevent the authorities of a Member from 
proceeding expeditiously with regard to initiating an investigation, reaching preliminary or final 
determinations, whether affirmative or negative, or from applying provisional or final measures, in 
accordance with relevant provisions of this Agreement.   
Article 7  
 
Provisional Measures  
 
7.1 Provisional measures may be applied only if:  
(i) an investigation has been initiated in ac cordance with the provisions of Article 5 and
, 
a public notice has been given to that effect; and   
 (ii) interested parties have been given adequate opportunities to submit information, 
including responses to questionnaires se nt in accordance with Article 6.1.1,  and make 
comments;  
 
(iii) a detailed preliminary affirmative determina tion has been made of dumping and 
consequent injury to a domestic indus try taking into account any responses to 
questionnaires and any other relevant info rmation submitted by interested parties ; and 
  TN/RL/W/236 
 Page 17 
 
 
  (iiiiv) the authorities concerned judge such meas ures necessary to prevent injury being 
caused during the investigation. 
 7.2 Provisional measures may take the form of a provisional duty or, preferably, a security - by cash deposit or bond - equal to the amount of th e anti-dumping duty provisionally estimated, being 
not greater than the provisionally estimated margin of dumping.  Withholding of appraisement is an 
appropriate provisional measure, provided that th e normal duty and the estimated amount of the 
anti-dumping duty be indicated and as long as the withholding of appraisement is subject to the same conditions as other provisional measures.  
7.3 Provisional measures shall not be applied soone r than 60 days from the date of initiation of 
the investigation.  7.4 The application of provisional measures shall be limited to as short a period as possible, not exceeding four months or, on decision of the au thorities concerned, upon request by exporters 
representing a significant percentage of the trade involved, to a period not exceeding six months.  
When authorities, in the course of an investigati on, examine whether a duty lower than the margin of 
dumping would be sufficient to remove injury , these periods may be six and nine months, 
respectively.  7.5 The relevant provisions of Article 9 shall be followed in the application of provisional 
measures. 
  
Article 8  
 
Price Undertakings  
 
8.1 Proceedings may
28 be suspended or terminated w ithout the imposition of provisional 
measures or anti-dumping duties upon receipt of  satisfactory voluntary undertakings from any 
exporter to revise its prices or to cease exports to the area in question at dumped prices so that the 
authorities are satisfied that the injurious effect of the dumping is eliminated.  Price increases under 
such undertakings shall not be higher than necessar y to eliminate the margin of dumping.  It is 
desirable that the price increases be less than th e margin of dumping if such increases would be 
adequate to remove the injury to the domestic industry.  8.2 Price undertakings shall not be sought or accepted from exporters unless the authorities of the 
importing Member have made a preliminary affirm ative determination of dumping and injury caused 
by such dumping or, if no affirmative preliminary determination is made, until the authorities have 
made disclosure pursuant to paragraph 9 of Article 6.   The authorities shall inform exporters of their 
right to offer undertakings and shall allo w them an adequate opportunity to do so . 
 8.3  Undertakings offered need not be accep ted if the authorities consider their acceptance 
impractical, for example, if the number of actual or potential exporters is too great, or for other 
reasons, including reasons of general policy.  Should the case arise and where practica
ble, t The 
authorities shall provide to the exporter the reasons which have led them to consider acceptance of an 
undertaking as inappropriate, and shall, to the extent possible,  give the exporter an opportunity to 
make comments thereon. 
 
                                                      
28 The word "may" shall not be interpreted to allow the simultaneous continuation of proceedings with 
the implementation of price undertakings except as provided in paragraph 4. TN/RL/W/236 
Page 18  
 
  8.4 If an undertaking is accepted, the investigation of dumping and injury shall nevertheless be  
completed if the exporter so desires or the author ities so decide.  In such a case, if a negative 
determination of dumping or injury is made, the unde rtaking shall automatically lapse, except in cases 
where such a determination is due in large part to the existence of a price undertaking.  In such cases, 
the authorities may require that an undertaking be ma intained for a reasonable period consistent with 
the provisions of this Agreement.  In the event that an affirmative determination of dumping and 
injury is made, the undertaking shall continue cons istent with its terms and the provisions of this 
Agreement.  8.5 Price undertakings may be suggested by the authorities of the importing Member, but no 
exporter shall be forced to enter into such undertak ings.  The fact that exporters do not offer such 
undertakings, or do not accept an invitation to do so, shall in no way prejudice the consideration of the case.  However, the authorities are free to determine that a threat of injury is more likely to be realized 
if the dumped imports continue.  
8.6 Authorities of an importing Member may requi re any exporter from whom an undertaking has 
been accepted to provide periodically information re levant to the fulfilment of such an undertaking 
and to permit verification of pertinent data.  In case of material 
violation of an undertaking, the 
authorities of the importing Member may take, unde r this Agreement in conformity with its 
provisions, expeditious actions wh ich may constitute immediate app lication of provisional measures 
using the best information available.29  In such cases, definitive du ties may be levied in accordance 
with this Agreement on products  entered for consumption not more than 90 days before the 
application of such provisional measures, except that  any such retroactive assessment shall not apply 
to imports entered before the violation of the undertaking.   
Article 9  
 
Imposition and Collection of Anti-Dumping Duties  
 
9.1 The decision whether or not to impose an anti-dumping duty in cases where all requirements for the imposition have been fulfilled, and the d ecision whether the amount of the anti-dumping duty 
to be imposed shall be the full margin of dumping or  less, are decisions to be made by the authorities 
of the importing Member.  It is desirable that th e imposition be permissive in the territory of all 
Members, and that the duty be less than the margin if such lesser duty would be adequate to remove 
the injury to the domestic industry.  
[PUBLIC INTEREST/LESSER DUTY: Participants are sharply divided on the desirability of a procedure to take account of  the representations of domestic interested 
parties when deciding whether to impose a dut y.  Some consider that such a procedure 
would impinge on Members' sovereignty and wo uld be costly and time-consuming, while 
others support inclusion of such a procedu re.  Issues related to any such procedure 
include the extent to which any such procedur es should apply in the context of Article 11 
reviews, whether the ADA's requirement for a judicial review mechanism should apply 
to decisions pursuant to any such procedu re, and the extent to which WTO dispute 
settlement should apply.  On lesser duty, many  delegations strongly support inclusion of 
a mandatory lesser duty rule.  Other delegatio ns oppose the inclusion of such a rule, 
with one delegation noting that it was not practically possible to calculate an injury 
margin.  Among those supporting a mandatory lesser duty rule, there are varying views 
                                                     
 
29 Without prejudice to the right to take expeditious actions, the authorities shall inform the exporter if 
they consider that there has been a material violation of the undertaking, and shall provide the exporter an 
opportunity to comment.    TN/RL/W/236 
 Page 19 
 
 
  about the appropriate degree of specificity for any new rules and the extent to which 
those rules should prescribe or prioritize particular approaches to determining the appropriate level of duty.] 
 
9.2 When an anti-dumping duty is imposed in respect of any product, such anti-dumping duty 
shall be collected in the appropriate amounts in each  case, on a non-discriminatory basis on imports of 
such product from all sources found to be dumped a nd causing injury, except as to imports from those 
sources from which price undertakings under the terms of this Agreement have been accepted.  The 
authorities shall name the supplier or suppliers of the product concerned.  If, however, several 
suppliers from the same country are involved, and it  is impracticable to name all these suppliers, the 
authorities may  name the supplying country concer ned.  If several suppliers from more than one 
country are involved, the authorities may name eith er all the suppliers involved, or, if this is 
impracticable, all the supplying countries involved.  9.3 The amount of the anti-dumping duty shall not exceed the margin of dumping as established 
under Article 2.  In this regard, each  Member shall establish procedures
30 to ensure a prompt refund, 
upon request, where the amount collected  exceeds the actual margin of dumping.31  In this respect, the 
following subparagraphs shall apply.  
  
9.3.1 When the amount of the anti-dumping duty is assessed on a retrospective 
basis, the  determination of the final liability for payment of anti-dumping 
duties shall take place as soon as possible, normally within 12 months, and in 
no case more than 18 months, after the date on which a request for a final assessment of the amount of the anti-dumping duty has been made.
32  Any 
refund shall be made promptly and normally in not more than 90 days following the determination of fina l liability made pursuant to this 
sub-paragraph.  In any case, where a refund is not made within 90 days, the 
authorities shall provide an explanation if so requested. 
 
9.3.2 When the amount of the anti-dumping duty is assessed on a prospective basis, 
provision shall be made for a prompt refund, upon request, of any duty paid in excess of the margin of dumping.  A refund of any such duty paid in 
excess of the actual margin of dumping shall normally take place within 
12 months, and in no case more than 18 months, after the date on which a request for a refund, duly supported by evidence, has been made by an importer of the product subject to the anti-dumping duty, or by an exporter on 
behalf of, and in association with, one or more importers .  The refund 
authorized should normally be made within 90 days of the above-noted  
decision. 
 
9.3.3 In determining whether and to what  extent a reimbursement should be made 
when the export price is constructe d in accordance with paragraph 3 of 
Article 2, authorities should take account of any change in normal value, any 
change in costs incurred between impor tation and resale, and any movement 
in the resale price which is duly reflected in subsequent selling prices, and 
                                                      
30 These procedures shall be set forth in the Member's laws, regulations or published administrative 
procedures and shall be notified to the Committee pursuant to Article 18.5.  
31 The actual dumping margin determined by the authorities shall be based on the relevant updated 
normal value and export price.  
32 It is understood that the observance of the time-limits mentioned in this subparagraph and in 
subparagraph 3.2 may not be possible where the product in question is subj ect to judicial re view proceedings. TN/RL/W/236 
Page 20  
 
  should calculate the export price with no deduction for the amount of 
anti-dumping duties paid when conclusive evidence of the above is provided. 
 9.3.4 In the event that monies paid or  deposited are refunded pursuant to this 
paragraph, the authorities shall pay a reasonable amount of interest on the 
monies refunded.  
 9.4 When the authorities have limited their ex amination in accordance with the second sentence 
of paragraph 10 of Article 6, any anti-dumping dut y applied to imports fro m exporters or producers 
not included in the examination shall not exceed: 
 
(i) the weighted average margin of dumpi ng established with respect to the selected 
exporters or producers or, 
 
(ii) where the liability for payment of anti-dumping duties is calculated on the basis of a 
prospective normal value, the difference be tween the weighted average normal value 
of the selected exporters or producers and the export prices of exporters or producers not individually examined, 
 provided that the authorities shall disregard fo r the purpose of this paragraph any zero and de minimis  
margins and margins established under the circumstances referred to in paragraph 8 of Article 6.  The 
authorities shall apply individual duties or normal va lues to imports from any exporter or producer not 
included in the examination who has provided th e necessary information during the course of the 
investigation, as provided for in subparagraph 10.2 of Article 6.  9.5 If a product is subject to anti-dumping duties in an importing Member, the authorities shall 
promptly carry out a review for the purpose of determining individual margins of dumping for any 
exporters or producers in the exporting country in qu estion who have not exported the product to the 
importing Member during the period of investigation,  provided that these exporters or producers can 
show that (a) 
they are not related to any of the exporters or producers in the exporting country who are  
subject to the anti-dumping duties on the product, and (b) they have enga ged in one or more bona fide  
sales in commercial quantities into the importing Me mber (as evidenced by shipments of the product 
or by a contract for sale pursuant to which such sh ipments will occur within six months of the date 
upon which the contract was concluded) . 
  9.5.1 A decision whether or not to initiate  a review under this paragraph shall be 
taken within three months of the l odging of a written request, during which 
period the authorities may take such steps as they deem appropriate to verify 
the accuracy and adequacy of the inform ation contained in the request.  The 
applicant and the domestic industry shall be advised of the initiation of any 
review and a public notice of the initiation shall also be made.  If the 
authorities decide not to initiate a review, they shall provide the applicant 
with a written statement of the reasons underlying that decision.  
 
 9.5.2   The Such a review shall be initiated and carried out on an accelerated basis, 
compared to normal duty assessment and review proceedings in the importing Member, and shall in any even t be concluded within nine months 
of its initiation .   
 
 9.5.3 No anti-dumping duties shall be levied on imports from such exporters or producers while the review is being carried out.  The authorities may, however, withhold appraisement and/or request guarantees to ensure that, 
should such a review result in a determination of dumping in respect of such  TN/RL/W/236 
 Page 21 
 
 
  producers or exporters, anti-dumping duties can be levied retroactively to the 
date of the initiation of the review.  Upon collection of any such duties due, 
the authority shall promptly release any guarantee or bond.  
 
[ANTI-CIRCUMVENTION: Delegations disagree as to whether there should be specific 
rules on anti-circumvention. Some delegat ions consider that the only appropriate 
reaction to perceived circumvention is to seek initiation of a new investigation, while 
other delegations consider that anti-circumven tion is a reality, and that rules on anti-
circumvention are necessary to achieve so me degree of harmonisation among the 
procedures used by different Members.  To  the extent that rules are included, 
delegations disagree, inter alia, whether num erical thresholds are desirable, whether 
findings of dumping, injury and causation should be required and whether anti-circumvention measures should be company-specific or country-wide.]  
 
Article 10  
 
Retroactivity  
 
10.1 Provisional measures and anti-dumping duties sh all only be applied to products which enter 
for consumption after the time when the deci sion taken under paragra ph 1 of Article 7 and 
paragraph 1 of Article 9, respectively, enters into force, subject to the exceptions set out in this 
Article. 
 10.2 Where a final determination of injury (but not of a threat thereof or of a material retardation 
of the establishment of an industry) is made or, in  the case of a final determination of a threat of 
injury, where the effect of the dumped imports w ould, in the absence of the provisional measures, 
have led to a determination of injury, anti-dumping duties may be levied retroactively for the period 
for which provisional measures, if any, have been applied.  10.3 If the definitive anti-dumping duty is higher than  the provisional duty paid or payable, or the 
amount estimated for the purpose of the security, the difference shall not be collected.  If the 
definitive duty is lower than the provisional duty paid  or payable, or the amount estimated for the 
purpose of the security, the difference shall be re imbursed or the duty recalculated, as the case may 
be.  10.4 Except as provided in paragraph 2, where a dete rmination of threat of injury or material 
retardation is made (but no injury has yet occurred) a definitive anti-dumping duty may be imposed 
only from the date of the determin ation of threat of injury or material retardation, and any cash 
deposit made during the period of the application of provisional measures shall be refunded and any 
bonds released in an expeditious manner.  10.5 Where a final determination is negative, any cash deposit made during the period of the 
application of provisional measures shall be ref unded and any bonds released in an expeditious 
manner. 
 10.6 A definitive anti-dumping duty may be levi ed on products which were entered for 
consumption not more than 90 days prior to the date  of application of provisional measures, when the 
authorities determine for the dumped product in question that: 
 
(i) there is a history of dumping which caused injury or that the importer was, or should 
have been, aware that the exporter practises dumping and that such dumping would cause injury, and 
 TN/RL/W/236 
Page 22  
 
  (ii) the injury is caused by massive dumped imports of a product in a relatively short time 
which in light of the timing and the volume of the dumped imports and other 
circumstances (such as a rapid build-up of inventories of the imported product) is 
likely to seriously undermine the remedial  effect of the definitive anti-dumping duty 
to be applied, provided that the importers  concerned have been given an opportunity 
to comment. 
 10.7 The authorities may, after initiating an investig ation, take such measures as the withholding of 
appraisement or assessment as may be necessary to  collect anti-dumping duties retroactively, as 
provided for in paragraph 6, once they have suffici ent evidence that the conditions set forth in that 
paragraph are satisfied. 
 10.8 No duties shall be levied retroactively pur suant to paragraph 6 on products entered for 
consumption prior to the date of initiation of the investigation.  
10.8bis In the event that monies paid or deposited are refunded pursuant to paragr aphs 3 or 5 of this 
Article, the authorities shall pay a reasonable amount of interest on the monies refunded.  
  
Article 11  
 
Duration and Review of Anti-Dumping Duties and Price Undertakings  
 
11.1 An anti-dumping duty shall remain in force only as long as and to the extent necessary to counteract dumping which is causing injury.  
11.2 The authorities shall review the need for th e continued imposition of the duty, or for a 
modification of the level of the duty33, where warranted, on their ow n initiative or, provided that a 
reasonable period of time has elapsed since the im position of the definitive anti-dumping duty, upon 
request by any interested party which submits positive information substantiating the need for a 
review.34  Interested parties shall have the right to  request the authorities to examine whether the 
continued imposition of the duty is necessary to offset  dumping, whether the injury would be likely to 
continue or recur if the duty were removed or varied , or both.  Interested parties may also request a 
modification in the level of the duty.   If, as a result of the review under this paragraph, the authorities 
determine that there has been a change  in circumstances of a lasting nature35 since the original 
investigation or the last review under Article 11.2 or 11.3, such that  the anti-dumping duty is no 
longer warranted or the level of the duty applicable to one or more exporters  is no longer appropriate, 
the duty , it shall be terminated immediately or its level modified . 
 11.3 Notwithstanding the provisions of paragraphs 1 and 2, any de finitive anti-dumping duty shall 
be terminated on a date not later than five year s from its imposition (or from the date of the most 
recent review under paragraph 2 if that review ha s covered both dumping and injury, or under this 
paragraph), unless the authorities determine, in a review initiated before that date on their own 
                                                     
 
33 Where the anti-dumping duty imposed takes the form  of a prospective normal value, this requirement 
relates to the modification of the prospective normal value.  
34 A determination of final liability for payment of an ti-dumping duties, as provided for in paragraph 3 
of Article 9, does not by itself constitute a review within  the meaning of this Article.  However, a determination 
made pursuant to that paragraph is relevant evidence which may be considered when deciding whether the 
initiation of a review to examine the possible modification of the level of a duty under this Article is warranted.  
35 In determining whether there has been a change of  circumstances of a lasting nature, the authorities 
may take into account, inter alia , the impact of the existing duty and the possible consequences if that duty were 
terminated or modified.   TN/RL/W/236 
 Page 23 
 
 
  initiative or upon a duly substantiated request made by or on behalf of the domestic industry within a 
reasonable period of time prior to that date, that the expiry of the duty would be likely to lead to continuation or recurrence of dumping and injury.
36  The duty may remain in force pending the 
outcome of such a review.  
[SUNSET REVIEWS:  Delegations have wide ly differing views regarding various 
aspects of the sunset issue.  There is sharp disagreement as to whether there should be 
any automatic termination of measures after a given period of time and, if so, after how long.  On the two extremes of this issue a re those delegations that favour automatic 
termination after five years without any possib ility of extension and those that reject the 
principle of automatic termination altogether.   Other issues dividing delegations include 
whether there is a need for additional standards and criteria governing sunset determinations and, if so, what standards a nd criteria would be most appropriate; what 
rules should apply to the initiation of sunset reviews, including whether there should be limitations on ex officio  initiation, and proposed standing and evidentiary thresholds for 
initiation; and the timeframes for completion of investigations.] 
 
11.4 The provisions of Article 6 regarding evid ence and procedure shall apply to any review 
carried out under this Article.  Any such review sh all be carried out expeditiously and shall normally 
be concluded within 12 months of th e date of initiation of the review. 
 
11.5 The provisions of this Article shall apply mutatis mutandis  to price undertakings accepted 
under Article 8.   
Article 12  
 
Public Notice and Explanation of Determinations  
 
12.1 When the authorities are satisfied  that there is sufficient evidence to justify the initiation of an 
anti-dumping investigation pursuant to Article 5, th e Member or Members the products of which are 
subject to such investigation and other interested parties known to th e investigating authorities to have 
an interest therein shall be notified and a public notice shall be given. 
 
12.1.1 A public notice of the initiation of an investigation shall contain, or otherwise 
make available through a separate report
37, adequate information on the 
following: 
 
   (i) a description of the product under considerati on, including its 
tariff classification for customs purposes, the name of the 
exporting country or countries,  and, to the extent already 
known to the authorities,  the names of the exporters and 
foreign producers of the productproduct involved ; 
 
   (ii) the domestic like pr oduct and the domestic industry, 
including whether any domestic producers were excluded 
from the domestic industry, and the names of the applicant 
                                                      
36 When the amount of the anti-dumping duty is assessed on a retrospective basis, a finding in the most 
recent assessment proceeding under subpar agraph 3.1 of Article 9 that no duty is  to be levied shall not by itself 
require the authorities to terminate the definitive duty. 
37 Where authorities provide information and explanatio ns under the provisions of this Article in a 
separate report, they shall ensure that such  report is readily available to the public. TN/RL/W/236 
Page 24  
 
  and of the domestic producers of the like product (or, if 
relevant, associations of producers) supporting the 
application and of other domestic producers of the like 
product insofar as they are known to the investigating 
authorities;  
 
   (iii) the procedural background of the investigation, including the 
date on which the application was received and the date of 
initiation of the investigation; 
 
  (iv ii) the basis on which dumping is alleged in the application; 
   (i
v) a summary of the factors on which the allegation of injury is 
based; 
 
  (vi) whether the authorities may consider limiting their 
examination in accordance with paragraph 10 of Article 6 
and any procedures in that respect;  and  
   (vii
) next steps in the process, including the time limits allowed to 
interested parties for making their views known, other 
indicative time frames, periods of data collection and a 
contact to whom the address to which  representations by 
interested parties should be directed; 
   (vi)
 the time -limits allowed to in terested parties for making their 
views known . 
 12.2 Public notice shall be given of any preliminar y or final determination, whether affirmative or 
negative, of any decision to accept an undertaking pursu ant to Article 8, of the termination of such an 
undertaking, and of the termination of a definitiv e anti-dumping duty.  Each such notice shall set 
forth, or otherwise make available through a separate report, in sufficient detail the findings and 
conclusions reached on all issues of fact and law cons idered material by the investigating authorities.  
All such notices and reports shall be forwarded to the Member or Members the products of which are 
subject to such determination or undertaking and to ot her interested parties known to have an interest 
therein.  
 12.2.1 A public notice of the imposition of provisional measures shall set forth, or 
otherwise make available through a separate report, sufficiently detailed 
explanations of the analysis underlying 
for the preliminary determinations on 
dumping and injury and shall refer to th e matters of fact and law which have 
led to arguments being accepted or rejected.  Such a notice or report shall, due regard being paid to the requireme nt for the protection of confidential 
information, contain in particular: 
 
 (i)
 the names of the suppliers, or when this is impracticable, the 
supplying countries involved;  
 
 (i i) a description of the product under consideration, including its 
tariff classification which is sufficient for customs purposes, 
the name of the exporting country or countries, and the names 
of the known exporters and foreign producers of the product 
under consideration ;  TN/RL/W/236 
 Page 25 
 
 
   (ii) information concerning the domestic like product and the 
domestic industry, including th e names of all known domestic 
producers of the like product;  
  (iii) the periods of data collection for both the preliminary 
dumping and preliminary injury analysis;  
  (iv
ii) the margins of dumping established and information 
concerning the calculation of the margins of dumping, 
including an a full  explanation of the basis upon which 
normal values were established (sales in the home market, 
sales to a third market or cons tructed normal value), the basis 
upon which export prices were established (including, if 
appropriate, the adjustments related to the construction of 
export price), and reasons for the methodology used in the 
establishment and comparison of normal values and the 
export prices  (including any adjustments made to reflect 
differences affecting price comparability) and the normal 
value under Arti cle 2; 
 
 (i v) considerations  information  relevant to the injury 
determination as set out in Article 3, including information 
concerning the domestic market for the subject imports and 
the like product, the volume and the price effects of the 
subject  imports, the consequent impact of the subject 
imports on the domestic industry an d, if relevant, the factors 
leading to a conclusion of threat of material injury or 
material retardation of the establishment of a domestic 
industry ; 
  (vi) information concerning any use of full or partial facts 
available, including, where applicable, the reasons why 
information submitted by a party was rejected;  
  (vii) information concerning the on-the-spot verification of 
information used by the authorities, if undertaken;  
 
 (viii) information on any provisional measures being imposed, 
including the form, level, and duration of such measures; and  
 
 (ix) information concerning next steps in the process, and related 
time frames, and information concerning a contact to whom 
representations by interested parties should be directed (v) the 
main reasons leading to the determination . 
 
12.2.2 A public notice of conclusion or susp ension of an investigation in the case of 
an affirmative determination providing for the imposition of a definitive duty or the acceptance of a price undertaking shall contain, or otherwise make 
available through a separate report, all re levant information on the matters of 
fact and law and reasons which have le d to the imposition of final measures 
or the acceptance of a price  undertaking, due regard being paid to the requirement for the protection of confiden tial  information.  In particular, the 
notice or report shall contain the info rmation described in subparagraph 2.1, TN/RL/W/236 
Page 26  
 
  to the extent applicable, 
as well as the reasons for the acceptance or rejection 
of relevant arguments or claims ma de by the exporters, foreign producers  and 
importers, and the basis for any decision made under subparagraph  10.2 of 
Article  6. 
 
12.2.3 A public notice of the termination or  suspension of an investigation following 
the acceptance of an undertaking pursu ant to Article 8 shall include, or 
otherwise make available through a separate report, the non-confidential part of this undertaking.  
 
12.3 The provisions of this Article shall apply mutatis mutandis  to proceedings conducted pursuant 
to Articles 9.3 and 9.5,  to decisions under Article 10 to apply duties retroactively and to  the initiation 
and completion of reviews pursuant to Ar ticle 11 and to decisions under Article  10 to apply duties  
retroactively . 
 
 
Article 13  
 
Judicial Review  
 
 Each Member  whose national legislation c ontains provisions on anti-dumping measures shall 
maintain judicial, arbitral or administrative tribunals or procedures for the purpose, inter alia , of the 
prompt review of administrative ac tions relating to final determinati ons and reviews of  determinations 
within the meaning of Article 11.  Such tribunals or procedures shall be independent of the authorities 
responsible for the determina tion or review in question. 
 
 
Article 14  
 
Anti-Dumping Action on Behalf of a Third Country  
 
14.1 An application for anti-dumping action on beha lf of a third country shall be made by the 
authorities of the third country requesting action. 
 14.2 Such an application shall be supported by pri ce information to show that the imports are being 
dumped and by detailed informati on to show that the alleged dumping is causing injury to the 
domestic industry concerned in the third country.  Th e government of the third country shall afford all 
assistance to the authorities of the importing country to obtain any further information which the latter 
may require.  14.3 In considering such an application, the aut horities of the importing country shall consider the 
effects of the alleged dumping on the industry concerne d as a whole in the third country;  that is to 
say, the injury shall not be assessed in relation only to the effect of the alleged dumping on the 
industry's exports to the importing country or even on the industry's total exports. 
 14.4 The decision whether or not to proceed with a case shall rest with the importing country.  If the importing country decides that it is prepared to take action, the initiation of the approach to the 
Council for Trade in Goods seeking its approval for su ch action shall rest with the importing country. 
 
[THIRD COUNTRY DUMPING: Some delegations  support new rules on third country 
dumping, as in their view the current rules are unworkable, although it was emphasized 
that many other issues would have to be  addressed if this provision were to be  TN/RL/W/236 
 Page 27 
 
 
  operationalised.  Other delegations question whet her it is desirable to operationalise this 
provision at all, with one delegation preferring that the provision be deleted entirely.] 
  
Article 15  
 
Developing Country Members  
 
 It is recognized that special regard must be given by developed country Members to the 
special situation of developing country Members wh en considering the application of anti-dumping 
measures under this Agreement.  Possibilities of  constructive remedies provided for by this 
Agreement shall be explored before applying anti-dumping duties where they would affect the 
essential interests of developing country Members.  
[SPECIAL AND DIFFERENTIAL TREATMENT/TECHNICAL ASSISTANCE: After 
the Chairman's text was released, two groups of developing Members submitted a 
proposal relating to special and differential treatment and technical assistance in trade remedies (TN/RL/GEN/154).  Further considera tion of this proposal is required.]  
 
 
PART II 
 
 
Article 16  
 
Committee on Anti-Dumping Practices  
 
16.1 There is hereby established a Committee on An ti-Dumping Practices (referred to in this 
Agreement as the "Committee") composed of repr esentatives from each of the Members.  The 
Committee shall elect its own Chairman and shall meet  not less than twice a year and otherwise as 
envisaged by relevant provisions of this Agreemen t at the request of any Member.  The Committee 
shall carry out responsibilities as assigned to it unde r this Agreement or by the Members and it shall 
afford Members the opportunity of consulting on  any matters relating to the operation of the 
Agreement or the furtherance of its objectives.  Th e WTO Secretariat shall act as the secretariat to the 
Committee.  16.2 The Committee may set up subsidiary bodies as appropriate. 
 
16.3 In carrying out their functions, the Committe e and any subsidiary bodies may consult with 
and seek information from any source they deem ap propriate.  However, before the Committee or a 
subsidiary body seeks such information from a sour ce within the jurisdiction of a Member, it shall 
inform the Member involved.  It shall obtain the c onsent of the Member and any firm to be consulted. 
 
16.4 Members shall report without delay to the Committee all preliminary or final anti-dumping 
actions taken.  Such reports shall be available in  the Secretariat for inspection by other Members.  
Members shall also submit, on a se mi-annual basis, reports of any anti-dumping actions taken within 
the preceding six months, and a list of definitive me asures in force as of the end of that period
.  The 
semi-annual reports shall be submitt ed on an agreed standard form. 
 
16.5 Each Member shall notify the Committee (a) which of its authorities are competent to initiate 
and conduct investigations re ferred to in Article 5 and (b) its domestic procedures governing the 
initiation and conduct of such investigations. 
 TN/RL/W/236 
Page 28  
 
  Article 17  
 
Consultation and Dispute Settlement  
 
17.1 Except as otherwise provided herein, the Dis pute Settlement Understanding is applicable to 
consultations and the settlement of  disputes under this Agreement. 
 17.2 Each Member shall afford sympathetic consid eration to, and shall afford adequate opportunity 
for consultation regarding, repr esentations made by another Member with respect to any matter 
affecting the operation of this Agreement.  
 
17.3 If any Member considers that any benefit accruing to it, directly or indirectly, under this Agreement is being nullified or impaired, or that the achievement of any objective is being impeded, 
by another Member or Members, it may, with a view to reaching a mutually satisfactory resolution of the matter, request in writing consultations with th e Member or Members in question.  Each Member 
shall afford sympathetic consideration to any re quest from another Member for consultation.   
 17.4 If the Member that requested consultations considers that the consultations pursuant to 
paragraph 3 have failed to achieve a mutually agreed solution, a nd if final action has been taken by 
the administering authorities of the importing Member to levy definitive anti-dumping duties or to accept price undertakings, it may refer the matter to the Dispute Settlement Body ("DSB").  When a 
provisional  measure has a significant impact and the Member that requested consultations considers 
that the measure was taken contrary to the provisio ns of paragraph 1 of Article 7, that Member may 
also refer such matter to the DSB.  17.5 The DSB shall, at the request of the comp laining party, establish a panel to examine the 
matter based upon:  
 
(i) a written statement of the Member making the request indicating how a benefit 
accruing to it, directly or indirectly, u nder this Agreement has been nullified or 
impaired, or that the achieving of the objec tives of the Agreement is being impeded, 
and 
 
(ii) the facts made available in conformity with appropriate domestic procedures to the 
authorities of the importing Member. 
 17.6 In examining the matter referred to in paragraph 5: 
 
 (i) in its assessment of the facts of the ma tter, the panel shall determine whether the 
authorities' establishment of the facts w as proper and whether their evaluation of 
those facts was unbiased and objective.  If the establishment of the facts was proper 
and the evaluation was unbiased and objectiv e, even though the panel might have 
reached a different conclusion, the evaluation shall not be overturned; 
 
 (ii) the panel shall interpret the relevant provisions of the Agreement in accordance with 
customary rules of interpretation of public international law.  Where the panel finds 
that a relevant provision of the Agreemen t admits of more than one permissible 
interpretation, the panel shall find the author ities' measure to be in conformity with 
the Agreement if it rests upon one of  those permissible interpretations. 
 17.7 Confidential information provided to the pa nel shall not be disclosed without formal 
authorization from the person, body or authority prov iding such information.  Where such information 
is requested from the panel but release of such information by the panel is not authorized, a  TN/RL/W/236 
 Page 29 
 
 
  non-confidential summary of the information, authorized by the person, body or authority providing 
the information, shall be provided.  
PART III 
 
Article 18  
 
Final Provisions  
 
18.1 No specific action against dumping of exports  from another Member can be taken except in 
accordance with the provisions of  GATT 1994, as interpreted by this Agreement.
38 
 18.2 Reservations may not be entered in respect of any of the provisions of this Agreement without 
the consent of the other Members.  
18.3 Subject to subparagraphs 3.1 and 3.2, the provisions of this Agreement shall apply to 
investigations, and reviews of exis ting measures, initiated pursuant to  applications which have been 
made on or after the date of entry into force for a Member of the WTO Agreement. 
  18.3.1 With respect to the calculation of margins of dumping in refund procedures 
under paragraph 3 of Article 9, the rules used in the most recent 
determination or review of dumping shall apply. 
 
18.3.2 For the purposes of paragraph 3 of Article 11, existing anti-dumping 
measures shall be deemed to be imposed on a date not later than the date of 
entry into force for a Member of the WTO Agreement, except in cases in 
which the domestic legislation of a Member in force on that date already 
included a clause of the type provided for in that paragraph. 
 18.3bis The results of the DDA shall apply to inv estigations, and reviews of existing measures 
pursuant to Articles 9.3, 9.5, and 11, initiated pursu ant to applications which have been made on or 
after the date of entry into force of those results or , where an investigation or review is initiated by the 
authorities without those authorities having received an  application, the investigation or review was 
initiated on or after the date of entry into force of those results.  
 
18.4 Each Member shall take all necessary steps, of a general or particular character, to ensure, not 
later than the date of entry into force of the WTO Agreement for it, the conformity of its laws, 
regulations and administrative procedures with the provisions of this Agreement as they may apply 
for the Member in question.  18.5 Each Member shall inform the Committee of an y changes in its laws a nd regulations relevant 
to this Agreement and in the administ ration of such laws and regulations. 
 
18.6 The Committee shall review annually the impl ementation and operati on of this Agreement 
taking into account the objectives thereof.  Th e Committee shall inform annually the Council for 
Trade in Goods of developments during the period  covered by such reviews.  In addition, the 
Committee shall review the anti-dumping policy and pr actices of individual Members according to the 
schedule and procedures set forth in Annex III.  
 
18.7 The Annexes to this Agreement c onstitute an integral part thereof. 
                                                      
38 This is not intended to preclude action under other relevant provisions of GATT 1994, as 
appropriate. TN/RL/W/236 
Page 30  
 
  ANNEX I 
 
PROCEDURES FOR ON-THE-SPOT INVESTIGATIONS PURSUANT 
TO PARAGRAPH 7 OF ARTICLE 6 
 
 
1. Upon initiation of an investigation, the au thorities of the exporting Member and the firms 
known to be concerned should 
shall be informed of the intention to carry out on-the-spot 
investigations.  
2. If in exceptional circumstances it is intended to include non-governmental experts in the 
investigating team, the firms and the authorities of the exporting Member shall
should  be so informed.  
Such non-governmental experts shall should  be subject to effective sanctions for breach of 
confidentiality requirements.  
3. It shall 
should be standard practice to obtain explicit agreement of the firms concerned in the 
exporting Member before the visit is finally scheduled.  4. As soon as the agreement of the firms conc erned has been obtained, the investigating 
authorities shall
should  notify the authorities of the exporting Member of the names and addresses of 
the firms to be visited and the dates agreed. 
 
5. Sufficient advance notice shall should  be given to the firms in question before the visit is 
made.  To afford the firms adequate opportunity to prepare for on-the-spot investigations, the 
investigating authorities shall provide each firm at least 14 days advance notice of the dates on which 
the authorities expect to conduct any on-the-spot inv estigation of the information provided by that 
firm.39 
 6. Visits to explain the questionnaire should
may only be made at the request of an exporting 
firm.  Such a visit may only be made if (a) the authorities of the importing Member notify the 
representatives of the Member in question and (b) the latter do not object to the visit. 
 
7. As the main purpose of the on-the-spot investig ation is to verify information provided or to 
obtain further details, it shall should  be carried out after the response to the questionnaire has been 
received unless the firm agrees to the contrary an d the government of the exporting Member is 
informed by the investigating authorities of th e anticipated visit and does not object to it.  
 
7bis No less than 10 days prior to each on-the-spot investigation, the inves tigating authorities shall 
provide to the firm a document that sets forth the topics the firm should be prepared to address during 
the on-the-spot investigation, and describes the ty pes of supporting documentation that shall be made 
available for review. ;  further, it should be standard practi ce prior to the visit to advise the firms 
concerned of the general nature of the information to  be verified and of any further information which 
needs to be provided, though tThis shall should  not preclude requests to be made on the spot for 
further details to be provided in the light of information obtained. 
 8. Enquiries or questions put by the authoriti es or firms of the exporting Members and essential 
to a successful on-the-spot investigation shall
should , whenever possible, be an swered before the visit 
is made. 
 
                                                      
39 This does not prevent the auth orities from adjusting the date, where necessary in light of 
developments in the investigation, and after consultation with the firm concerned.   TN/RL/W/236 
 Page 31 
 
 
  9. The investigating authorities shall disclose in the form of a written report their factual 
findings resulting from the on-the-spot investigation.   In addition to the factual findings, the report 
shall describe the methods and procedures followed in carrying out the on-the-spot investigation.  The 
report shall be made available to all interested par ties in sufficient time for the parties to defend their 
interests, subject to the requirement to protect confidential information.  
 
 TN/RL/W/236 
Page 32  
 
  ANNEX II 
 
BEST INFORMATION AVAILABLE IN TERMS OF PARAGRAPH 8 OF ARTICLE 6 
  
1. As soon as possible after the initiation of the investigation, the investigating authorities 
should 
shall specify in detail the information required fro m any interested party, and the manner in 
which that information should be structured by the interested party in its response.  The authorities 
shall should  also ensure that the party is aware that if  information is not supplied within a reasonable 
time, the authorities will be free to may make determinations on the basis of the facts available, 
including those contained in the application for the initiation of the investigation by the domestic 
industry.  2. The authorities may also request that an inter ested party provide its response in a particular 
medium (e.g. computer tape) or computer language .  Where such a request is made, the authorities 
shallshould
 consider the reasonable ability of the inter ested party to respond in the preferred medium 
or computer language, and shall should not request the party to use for its response a computer system 
other than that used by the party.  The authority ies should shall  not maintain a request for a 
computerized response if the interested party does not maintain computerized accounts and if 
presenting the response as requested would result in  an unreasonable extra burden on the interested 
party, e.g. it would entail unreasonable additiona l cost and trouble.  The authorities should shall  not 
maintain a request for a response in a particular medium or computer language if the interested party 
does not maintain its computerized accounts in such  medium or computer language and if presenting 
the response as requested would result in an unreasonabl e extra burden on the interested party, e.g. it 
would entail unreasonable additional cost and trouble.  
3. All information which is verifiable, which is a ppropriately submitted so that it can be used in 
the investigation without undue difficulties
40, which is supplied in a timely fashion, and, where 
applicable, which is supplied in a medium or com puter language requested by the authorities, should  
shall be taken into account when determinations are ma de.  If a party does not respond in the preferred 
medium or computer language but the authorities find that the circumstances set out in paragraph 2 have been satisfied, the failure to respond in th e preferred medium or computer language should
 shall  
not be considered to significantly impede the investigation. 
 4. Where the authorities do not have the ability to process information if provided in a particular 
medium (e.g. computer tape), the information should
 shall  be supplied in the form of written material 
or any other form acceptable to the authorities. 
 
5. Even though the information provided may not be ideal in all respects, this should  shall  not 
justify the authorities from disregarding it, provided th e interested party has acted to the best of its 
ability.  6. If evidence or information is not accepted, the supplying party should
 shall  be informed 
forthwith of the reasons therefor, and should  shall  have an opportunity to submit further evidence or 
information, or to provide further explanations,  within a reasonable period, due account being taken of 
the time-limits of the investigation41.  If the further evidence or information submitted, or the  
explanations provided, are considered by the authorities as not being satisfactory, the authorities shall 
                                                      
40 Submitted information cannot be used without undue difficulties if, inter alia , an assessment of the 
accuracy or relevance of that information is dependent upon other information that  has not been supplied or 
cannot be verified.    
41 Provided that the authorities need not consider any further evidence or information that is not 
submitted in time such that it can be verified during any on-site investigation conducted pursuant to Article 6.7.   TN/RL/W/236 
 Page 33 
 
 
  inform the interested party concerned of the reasons for the rejection of such the evidence or 
information and should shall set forth such reasons be given  in any published determinations. 
 7. If the authorities have to base their findings, in cluding those with respect to normal value, on  
information from a secondary source, including th e information supplied in the application for the 
initiation of the investigation, they should
 shall  do so with special circumspection.  In such cases, the 
authorities should  shall , where practicable, check the information from other independent sources at 
their disposal or reas onably available to them , such as published price lists, official import statistics 
and customs returns, and from the information obt ained from other interested parties during the 
investigation42.  It is clear, however, that if an interest ed party does not cooperate and thus relevant 
information is being withheld from the authorities, th is situation could lead to a result which is less 
favourable to the party than if the party did cooperate. 
                                                      
42 The sources consulted shall be identified in the disclosure conducted pursuant to Article 6.9.  TN/RL/W/236 
Page 34  
 
  ANNEX III
 
 
PROCEDURES FOR THE REVIEW OF MEMBERS'  
ANTI-DUMPING POLICY AND PRACTICES PURSUANT TO ARTICLE 18.5  
 
1. The anti-dumping policy and practices of Members shall be subject to periodic review by the 
Committee.  
 
A. Objectives  
 
2. The purpose of the review is to contribute to  the transparency and understanding of Members' 
policies and practices in respect of anti-dumping.  Th e review is not intended to serve as the basis for 
enforcement of specific obligations under this Agre ement or for dispute settlement procedures, or to 
impose new policy commitments on Members.  
 
B. Procedures for Review  
 
3. The review shall be conducted on the basis of the following documentation:  
  (a) a factual report, to be drawn up by the Secretariat on its own responsibility;  and 
 
 
 (b) if the Member under review so wishes, a report supplied by that Member.  
 4. The factual report by the Secretariat shall be based on the information available to it and that 
provided by the Member under review.  The Secretariat should seek clarification from such Member 
regarding its anti-dumping policies and practices making use of the indicative checklist identified in 
paragraph 8 of this Annex.  The Member under review shall provide the information requested for the 
preparation of the report, and shall be provided w ith an opportunity to comment on the draft report 
prior to its circulation.    
 5. The first cycle of reviews shall begin three y ears after the date of entry into force of the 
results of the Doha Development Ag enda.   During the ensuing five years, the Committee shall review 
the anti-dumping policies and practices of the 20 Members with the most anti-dumping measures in 
force as of the date of entry into force.43 
 6. The list of the Members to be reviewed duri ng each subsequent five-year review period shall 
be established on the basis of the number of origin al investigations initiated during the most recent 
five-year period for which information is availabl e.  The list shall include the 20 Members that 
initiated the most investigations pursuant to Artic le 5 during that period, as well as any additional 
Members that have initiated five or more original in vestigations during that pe riod;  provided, that the 
Committee may adjust the list of Members to be revi ewed and/or the cycle for review in light of 
subsequent developments and experience.  
 
7. The Committee shall agree on the order of, an d schedule for, the conduct of these reviews, 
taking into account the resource constraints of the Secretariat and of developing country Members.44 
 
                                                      
43 Least-developed country Members shall be subject to review pursuant to this Annex on a voluntary 
basis only.  
44 In the event that the Committee fa ils to agree, the Direct or-General shall decide  on the order of, and 
schedule for, the reviews.   TN/RL/W/236 
 Page 35 
 
 
  8. The factual report of the Secretariat shall describe in detail the anti-dumping policy and 
practices of the Member under review including, wher e relevant and applicable, with respect to the 
following matters:  
 
• institutional organization of the investigating authorities  
• statistics on proceedings carried-out  
• pre-initiation procedures and practices  
• determination of export price and nor mal value (and adjustments thereto)  
• details of comparison methods  
• calculation of dumping margin  
• details and methodology of analysis and determination of injury and causal link  
• application of a lesser duty  
• application of public interest considerations  
• level of co-operation obtained  
• use of facts available  
• procedural requirements  
• treatment of confidential information  
• practice with regard to on-the-spot verifications  
• duty collection and assessment system  
• acceptance of undertakings  
• review investigations (under Articles 9 and 11)  
• anti-circumvention procedures  
• judicial/administrative review  
 9. The report by the Secretariat and any report by the Member subject to review shall be 
circulated to the Members on an unrestricted basis, a nd shall be considered at a special meeting of the 
Committee convened for that purpose.  
 10. Members recognize the need to minimize th e burden for governments that might arise from 
unnecessary duplication of work pursuant to this proc edure and the Trade Policy Review Mechanism.  
 
C. Developing Country Members  
 
11. The Secretariat shall make technical assistance available, on request of a developing country 
Member, to facilitate that Member's  effective participation in the review.  The Secretariat shall also 
consult with the developing country Member subject  to review and shall, where appropriate, include 
in its report to the Committee an assessment of that Member's broader technical assistance and 
resource needs with respect to anti-dumping.  
 
D. Appraisal  of the Mechanism  
 
12. The Committee shall undertake an appraisal  of the operation of these procedures upon 
completion of the first cycle of reviews.  The Co mmittee should seek to identify any changes which 
would enhance the operation of these procedures, and may, if appropriate, recommend that the 
Council for Trade in Goods submit to the Ministeria l Conference any proposals for the amendment of 
these procedures necessary to e ffectuate such changes.   
  
 
_______________ 
 TN/RL/W/236 
Page 37 
 
 
  AGREEMENT ON SUBSIDIES AND COUNTERVAILING MEASURES 
 
 Members  hereby agree  as follows: 
 
 
PART I:  GENERAL PROVISIONS 
  
Article 1  
 
Definition of a Subsidy  
 
1.1 For the purpose of this Agreement, a subsidy shall be deemed to exist if: 
 
(a)(1) there is a financial contribution by a government or any public body within 
the territory of a Member (referred to  in this Agreement as "government"), 
i.e. where: 
 
(i) a government practice involves a direct tr ansfer of funds (e.g. grants, loans,  
and equity infusion), potential direct transfers of funds or liabilities (e.g. loan 
guarantees); 
 
(ii) government revenue that is otherwi se due is foregone or not collected (e.g. 
fiscal incentives such as tax credits) 
1; 
 
(iii) a government provides goods or service s other than general infrastructure, or 
purchases goods; 
 
(iv) a government makes payments to a f unding mechanism, or entrusts or directs 
a private body to carry out one or more of the type of functions illustrated in (i) to (iii) above which would normally be vested in the government and the 
practice, in no real sense, differs from practices normally followed by 
governments; 
 
or 
 
(a)(2) there is any form of income or pr ice support in the sense of Article XVI of 
GATT 1994; 
 
and 
 
(b) a benefit is thereby conferred.
2 
 
                                                      
1 In accordance with the provisio ns of Article XVI of GATT 1994 (Note to Article XVI) and the 
provisions of Annexes I through III of this Agreement, the exemption of an exported product from duties or 
taxes borne by the like product when destined for domestic consumption, or the remission of such duties or taxes in amounts not in excess of those which have accrued, shall not be deemed to be a subsidy. 
2 A benefit is conferred when the terms of the financial contribution are more favourable than those 
otherwise commercially available to the recipient in the market.  Where relevant, for the determination of the 
existence of a benefit Article 14.1 shall provide guidance for determining whether such more favourable terms 
exist.    TN/RL/W/236 
Page 38  
 
  1.2 A subsidy as defined in paragraph 1 shall be subject to the provisions of Part II or shall be 
subject to the provisions of Part III or V only if such a subsidy is specific in accordance with the 
provisions of Article 2.   
Article 2  
 
Specificity  
 
2.1 In order to determine whether a subsidy, as defi ned in paragraph 1 of Article 1, is specific to 
an enterprise or industry or group of enterprises or industries (referred to in this Agreement as "certain 
enterprises") within the jurisdiction of the granting authority, the following principles shall apply: 
 
(a) Where the granting authority, or the legislation pursuant to which the granting 
authority operates, explicitly limits access to a subsidy to certain enterprises, such 
subsidy shall be specific. 
 
(b) Where the granting authority, or the legislation pursuant to which the granting 
authority operates, establishes objective criteria or conditions
3 governing the 
eligibility for, and the amount of, a subsidy, specificity shall not exist, provided that 
the eligibility is automatic and that such crite ria and conditions are strictly adhered to.  
The criteria or conditions must be clearly spelled out in law, regulation, or other 
official document, so as to be capable of verification. 
 
(c) If, notwithstanding any appearance of non- specificity resulting from the application 
of the principles laid down in subparagraphs (a) and (b), there are reasons to believe 
that the subsidy may in fact be specific,  other factors may be considered.  Such 
factors are:  use of a subsidy programme by a limited number of certain enterprises, predominant use by certain enterprises, the granting of disproportionately large amounts of subsidy to certain enterprises,  and the manner in which discretion has 
been exercised by the granting authorit y in the decision to grant a subsidy.
4  In the 
case of subsidies conferred through the provision of goods or services at regulated 
prices, factors that may be considered include the exclusion of firms within the 
country in question from access to the goods or services at the regulated prices.  In 
applying this subparagraph, acc ount shall be taken of the ex tent of diversification of 
economic activities within the jurisdiction of  the granting authority, as well as of the 
length of time during which the subsidy programme has been in operation. 
 
2.2 A subsidy which is limited to certain ente rprises located within a designated geographical 
region within the jurisdiction of the granting authority shall be specific.  It is understood that the setting or change of generally applicable tax rates by all levels of government entitled to do so shall 
not be deemed to be a specific subsidy for the purposes of this Agreement.    
2.3 Any subsidy falling under the provi sions of paragraphs 1(a) or 1(b)
 of Article 3 shall be 
deemed to be specific.  
                                                     
 
3 Objective criteria or conditions, as used herein, mean criteria or conditions which are neutral, which 
do not favour certain enterprises over others, and which ar e economic in nature and horizontal in application, 
such as number of employees or size of enterprise. 
4 In this regard, in particular, information on the frequency with which applications for a subsidy are 
refused or approved and the reasons for such decisions shall  be considered.  TN/RL/W/236 
 Page 39 
 
 
  2.4 Any determination of specificity under the provisions of this Article shall be clearly 
substantiated on the basis of positive evidence.   
PART II:  PROHIBITED SUBSIDIES 
 
 
Article 3  
 
Prohibition  
 
3.1 Except as provided in the Agreement on Agriculture, the following subsidies, within the meaning of Article 1, shall be prohibited:  
(a) subsidies contingent, in law or in fact
5, whether solely or as one of several other 
conditions, upon export performance, in cluding those illustrated in Annex I6; 
 
(b) subsidies contingent, whether solely or  as one of several other conditions, upon the 
use of domestic over imported goods. ; 
 (c) subsidies referred to in Article I of Annex VIII.
 
 
 3.2 A Member shall neither grant nor mainta in subsidies referred to in paragraph 1. 
  
Article 4   
 
Remedies  
 
4.1 Whenever a Member has reason to believe th at a prohibited subsidy is being granted or 
maintained by another Member, such Member may request consultations with such other Member. 
 
4.2 A request for consultations under paragraph 1 sh all include a statement of available evidence 
with regard to the existence and na ture of the subsidy in question. 
 4.3 Upon request for consultations under paragra ph 1, the Member believed to be granting or 
maintaining the subsidy in question shall enter into  such consultations as quickly as possible.  The 
purpose of the consultations shall be to clarify the f acts of the situation and to arrive at a mutually  
agreed solution.  
                                                     
 
5  This standard is met when the facts demonstrate that the granting of a subsidy, without having been 
made legally contingent upon export performance, is in fact tied to actual or anticipated exportation or export 
earnings. The mere fact that a subsidy is granted to ente rprises which export shall not for that reason alone be 
considered to be an export subsidy w ithin the meaning of this provision.  
6 The Mmeasures referred to in Annex I as export subsidies shall be deemed to fall within 
paragraph (a).  The legal status of any measure not referred to in Annex I as an export subsidy shall be 
determined on the basis of paragraph (a), and Annex I shall not be used to establish by negative implication that 
a measure does not constitute an export subsidy within th e meaning of that paragraph;  provided, however, that 
measures explicitly referred to in Annex I as not constituting prohibited export subsidies shall not be prohibited 
under this or any other provision of this Agreement.  This footnote is without prejudice to the operation of 
footnote 1.  TN/RL/W/236 
Page 40  
 
  4.4 If no mutually agreed solution has been reached within 30 days
7 of the request for 
consultations, any Member party to  such consultations may refer th e matter to the Dispute Settlement 
Body ("DSB") for the immediate establishment of a panel, unless the DSB decides by consensus not 
to establish a panel.  
4.5 Upon its establishment, the panel may requ est the assistance of the Permanent Group of 
Experts
8 (referred to in this Agreement as the "PGE") with regard to whether the measure in question 
is a prohibited subsidy.  If so requested, the PGE sh all immediately review the evidence with regard to 
the existence and nature of the measure in questi on and shall provide an opportunity for the Member 
applying or maintaining the measure to demonstrat e that the measure in question is not a prohibited 
subsidy.  The PGE shall report its conclusions to the panel within a time-limit determined by the 
panel.  The PGE's conclusions on the issue of whet her or not the measure in question is a prohibited 
subsidy shall be accepted by the panel without modification. 
 4.6 The panel shall submit its final report to the parties to the dispute.  The report shall be 
circulated to all Members within 90 days of the date of the composition and the establishment of the 
panel's terms of reference.  4.7 If the measure in question is found to be a pr ohibited subsidy, the panel shall recommend that 
the subsidizing Member withdraw the subsidy without delay.   In this regard, the panel shall specify in 
its recommendation the time-period within wh ich the measure must be withdrawn.   
 
4.8 Within 30 days of the issuance of the  pane l's report to all Members, the report shall be 
adopted by the DSB unless one of the parties to the dispute formally notifies the DSB of its decision 
to appeal or the DSB decides by consensus not to adopt the report. 
 
4.9 Where a panel report is appealed, the Appellate  Body shall issue its decision within 30 days 
from the date when the party to the dispute forma lly notifies its intention to appeal.  When the 
Appellate Body considers that it cannot provide its report within 30 days, it shall inform the DSB in 
writing of the reasons for the delay together with an estimate of the period within which it will submit 
its report.  In no case shall the proceedings exceed 60 days.  The appellate report shall be adopted by 
the DSB and unconditionally accepted by the part ies to the dispute unless the DSB decides by 
consensus not  to adopt the appellate report with in 20 days following its issuance to the Members.
9 
 4.10 In the event the recommendation of the DSB is not followed within the time-period specified 
by the panel, which shall commence from the date of  adoption of the panel’s report or the Appellate 
Body’s report, the DSB shall grant authorization to the complaining Member to take appropriate
10  
countermeasures, unless the DSB decides by consensus to reject the request.  
 4.11 In the event a party to the dispute requests arbitration under paragraph 6 of Article 22 of the 
Dispute Settlement Understanding ("DSU"), the arbitrator shall determine whether the 
countermeasures are appropriate.
11 
 
                                                      
7 Any time-periods mentioned in this Article may be extended by mutual agreement. 
8 As established in Article 24. 
9 If a meeting of the DSB is not scheduled during this period, such a meeting shall be held for this 
purpose.  
10 This expression is not meant to allow countermeasures  that are disproportionate in light of the fact 
that the subsidies dealt with under these provisions are prohibited. 
11 This expression is not meant to allow countermeasures  that are disproportionate in light of the fact 
that the subsidies dealt with under these provisions are prohibited.     TN/RL/W/236 
 Page 41 
 
 
  4.12 For purposes of disputes conducted pursuan t to this Article, except for time-periods 
specifically prescribed in this Article, time-periods  applicable under the DSU for the conduct of such 
disputes shall be half the time prescribed therein.     
PART III:  ACTIONABLE SUBSIDIES 
  
Article 5   
 
Adverse Effects  
 
 No Member should cause, through the use of any subsidy referred to in paragraphs 1 and 2 of 
Article 1, adverse effects to the interests of other Members, i.e.:  
(a) injury to the domestic industry of another Member
12; 
 
(b) nullification or impairment of benefits  accruing directly or indirectly to other 
Members under GATT 1994 in particular the benefits of concessions bound under Article II of GATT 1994
13; 
 
(c) serious prejudice to the interests of another Member.14 
 This Article does not apply to subsidies maintained  on agricultural products as provided in Article 13 
of the Agreement on Agriculture.  
 
Article 6  
 
Serious Prejudice  
 
6.1 Serious prejudice in the sense of paragraph (c) of Article 5 shall be deemed to exist in the 
case of: 
 
(a) the total ad valorem subsidization
15 of a product exceeding 5 per cent16; 
 
(b) subsidies to cover operating losses sustained by an industry; 
 
(c) subsidies to cover operating losses sustaine d by an enterprise, other than one-time 
measures which are non-recurrent and cannot be repeated for that enterprise and 
which are given merely to provide time fo r the development of long-term solutions 
and to avoid acute social problems; 
                                                      
12 The term "injury to the domestic industry" is used here in the same sense as it is used in Part V. 
13 The term "nullification or impairment" is used in this Agreement in the same sense as it is used in the 
relevant provisions of GATT 1994, and the existence of su ch nullification or impairment shall be established in 
accordance with the practice of app lication of these provisions.  
14 The term "serious prejudice to the interests of another Member" is used in this Agreement in the 
same sense as it is used in paragraph 1 of Article XVI of GATT 1994, and includes threat of serious prejudice. 
15 The total ad valorem subsidization shall be calculated in accordance with the provisions of 
Annex IV. 
16 Since it is anticipated that civil aircraft will be subject to specific multilateral rules, the threshold in 
this subparagraph does not apply to civil aircraft. TN/RL/W/236 
Page 42  
 
  (d) direct forgiveness of debt, i.e. forgiv eness of government-held debt, and grants to 
cover debt repayment.
17 
 6.2 Notwithstanding the provisions of paragraph 1, serious prejudice shall not be found if the 
subsidizing Member demonstrates that the subsidy in  question has not resulted in any of the effects 
enumerated in paragraph 3.  
 6.3 Serious prejudice in the sense of paragraph (c) of Article 5 may arise in any case where one or 
several of the following apply:  
(a) the effect of the subsidy is to displace or impede the imports of a like product of 
another Member into the market of the subsidizing Member; 
 
(b) the effect of the subsidy is to displace  or impede the exports of a like product of 
another  Member from a third country market; 
 
(c) the effect of the subsidy is a significan t price undercutting by the subsidized product 
as compared with the price of a like product of another Member in the same market 
or significant price suppression, price depression or lost sales in the same market; 
 
(d) the effect of the subsidy is an increase in the world market share of the subsidizing 
Member in a particular subsidi zed primary product or commodity
18 as compared to 
the average share it had during the previous period of three years and this increase 
follows a consistent trend over a period when subsidies have been granted. 
 6.4 For the purpose of paragraphs 3(a) and
 3(b), the displacement or impeding of imports or  
exports, respectively,  shall include any case in which, subject to the provisions of paragraph 7, it has 
been demonstrated that there has b een a change in relative shares of the market to the disadvantage of 
the non-subsidized like product (over an appropriate ly representative period sufficient to demonstrate 
clear trends in the development of the market  for the product concerned, which, in normal 
circumstances, shall be at least one year).  "Change  in relative shares of the market" shall include any 
of the following situations:  (a) there is an increase in the market share of the subsidized product;  
(b) the market share of the subsidized product remain s constant in circumstances in which, in the 
absence of the subsidy, it would have declined;  (c) the  market share of the subsidized product 
declines, but at a slower rate than would have  been the case in the absence of the subsidy. 
 6.5 For the purpose of paragraph 3(c), price unde rcutting shall include any case in which such 
price undercutting has been demonstrated through a comparison of prices of the subsidized product 
with prices of a non-subsidized like product supplie d to the same market.  The comparison shall be 
made at the same level of trade and at comparable times, due account being taken of any other factor 
affecting price comparability.  However, if such a di rect comparison is not possible, the existence of 
price undercutting may be demonstrated on the basis of export unit values.  
6.6 Each Member in the market of which serious pr ejudice is alleged to have arisen shall, subject 
to the provisions of paragraph 3 of Annex V, make available to the parties to a dispute arising under 
Article 7, and to the panel established pursuant to pa ragraph 4 of Article 7, all relevant information 
                                                     
 
17 Members recognize that where royalty-based financ ing for a civil aircraft programme is not being 
fully repaid due to the level of actual sales falling belo w the level of forecast sales, this does not in itself 
constitute serious prejudice for the purposes of this subparagraph. 
18 Unless other multilaterally agreed specific rules apply to the trade in the product or commodity in 
question.   TN/RL/W/236 
 Page 43 
 
 
  that can be obtained as to the changes in market sh ares of the parties to the dispute as well as 
concerning prices of the products involved.  6.7 Displacement or impediment resulting in ser ious prejudice shall not arise under paragraph 3 
where any of the following circumstances exist
19 during the relevant period: 
 
(a) prohibition or restriction on exports of  the like product from the complaining Member 
or on imports from the complaining Member into the third country market concerned; 
 
(b) decision by an importing government operating a monopoly of trade or state trading 
in the product concerned to shift, fo r non-commercial reasons, imports from the 
complaining Member to another country or countries; 
 
(c) natural disasters, strikes, transport disruptions or other force majeure  substantially 
affecting production, qualities, quantities or prices of the product available for export 
from the complaining Member; 
 
(d) existence of arrangements limiting exports from the complaining Member; 
 
(e) voluntary decrease in the availability fo r export of the product concerned from the 
complaining Member (including, inter alia , a situation where firms in the 
complaining Member have been autonomously  reallocating exports of this product to 
new markets); 
 
(f) failure to conform to standards and othe r regulatory requirements in the importing 
country. 
 
6.8 In the absence of circumstances referred to in  paragraph 7, the existence of serious prejudice 
should be determined on the basis of the informatio n submitted to or obtained by the panel, including 
information submitted in accordance with the provisions of Annex V.  6.9 This Article does not apply to subsidies ma intained on agricultural products as provided in 
Article 13 of the Agreement on Agriculture. 
  
Article 7  
 
Remedies  
 
7.1 Except as provided in Article 13 of the Agre ement on Agriculture, whenever a Member has 
reason to believe that any subsidy referred to in Ar ticle 1, granted or maintained by another Member, 
results in injury to its domestic industry, nullifi cation or impairment or serious prejudice, such 
Member may request consultations with such other Member. 
 
7.2 A request for consultations under paragraph 1 shall include a statement of available evidence 
with regard to (a) the existence and nature of the subsidy in question, and (b) the injury caused to the 
                                                     
 
19 The fact that certain circumstances  are referred to in this paragraph does not, in itself, confer upon 
them any legal status in terms of either GATT 1994 or  this Agreement.  These circumstances must not be 
isolated, sporadic or otherwise insignificant. TN/RL/W/236 
Page 44  
 
  domestic industry, or the nullification or impairment, or serious prejudice
20 caused to the interests of 
the Member requesting consultations.  7.3 Upon request for consultations under paragra ph 1, the Member believed to be granting or 
maintaining the subsidy practice in question shall ente r into such consultations as quickly as possible.  
The purpose of the consultations shall be to clarify the facts of the situation and to arrive at a mutually 
agreed solution.  7.4 If consultations do not result in a mu tually agreed solution within 60 days
21, any Member 
party to such consultations may refer the matter to  the DSB for the establishment of a panel, unless 
the DSB decides by consensus not to establish a pane l.  The composition of the panel and its terms of 
reference shall be established within 15 da ys from the date when it is established.  
 7.5 The panel shall review the matter and shall submit its final report to the parties to the dispute.  
The report shall be circulated to all Members with in 120 days of the date of the composition and 
establishment of the panel’s terms of reference. 
 7.6 Within 30 days of the issuance of the panel’ s report to all Members, the report shall be 
adopted by the DSB
22 unless one of the parties to the dispute fo rmally notifies the DSB of its decision 
to appeal or the DSB decides by co nsensus not to adopt the report.  
 
7.7 Where a panel report is appealed, the Appellate  Body shall issue its decision within 60 days 
from the date when the party to the dispute forma lly notifies its intention to appeal.  When the 
Appellate Body considers that it cannot provide its report within 60 days, it shall inform the DSB in 
writing of the reasons for the delay together with an estimate of the period within which it will submit 
its report.  In no case shall the proceedings exceed 90 days.  The appellate report shall be adopted by 
the DSB and unconditionally accepted by the part ies to the dispute unless the DSB decides by 
consensus not  to adopt the appellate report with in 20 days following its issuance to the Members.23 
 7.8 Where a panel report or an Appellate Body re port is adopted in which it is determined that 
any subsidy has resulted in adverse effects to the in terests of another Member within the meaning of 
Article 5, the Member granting or maintaining such subsidy shall take appropria te steps to remove the 
adverse effects or shall withdraw the subsidy. 
 7.9 In the event the Member has not taken appropria te steps to remove the adverse effects of the 
subsidy or withdraw the subsidy within six mont hs from the date when the DSB adopts the panel 
report or the Appellate Body report, and in the absence of agreement on comp ensation, the DSB shall 
grant authorization to the complaining Member to take countermeasures, commensurate with the 
degree and nature of the adverse effects determined  to exist, unless the DSB decides by consensus to 
reject the request.  7.10 In the event that a party to the dispute requests arbitration under paragraph 6 of Article 22 of the DSU, the arbitrator shall determine whethe r the countermeasures are commensurate with the 
degree and nature of the adverse effects determined to exist. 
                                                     
 
20 In the event that the request relates to a subsidy deemed to result in serious prejudice in terms of 
paragraph 1 of Article 6, the available evidence of serious prejudice may be limited to the available evidence as 
to whether the conditions of paragraph 1 of Article 6 have been met or not. 
21 Any time-periods mentioned in this Article may be extended by mutual agreement. 
22 If a meeting of the DSB is not scheduled during this period, such a meeting shall be held for this 
purpose. 
23 If a meeting of the DSB is not scheduled during this period, such a meeting shall be held for this 
purpose.  TN/RL/W/236 
 Page 45 
 
 
  PART IV:  NON-ACTIONABLE SUBSIDIES 
  
Article 8  
 
Identification of Non-Actionable Subsidies  
 
8.1 The following subsidies shall be considered as non-actionable
24: 
 
(a) subsidies which are not specific within the meaning of Article 2; 
 
(b) subsidies which are specific within the m eaning of Article 2 but which meet all of the 
conditions provided for in paragra phs 2(a), 2(b) or 2(c) below. 
 8.2 Notwithstanding the provisions of Parts III and V, the following subsidies shall be 
non-actionable: 
 
(a) assistance for research activities conducted by firms or by higher education or 
research establishments on a contract basis with firms if:
25 ,26 ,27   
   the assistance covers
28 not more than 75 per cent of the costs of industrial research29 
or 50 per cent of the costs of pre-competitive development activity30, 31; 
                                                      
24 It is recognized that government assistance for various purposes is widely provided by Members and 
that the mere fact that such assist ance may not qualify for non-actionable treatment under the provisions of this 
Article does not in itself restrict the ability of Members to provide such assistance. 
25 Since it is anticipated that civil aircraft will be s ubject to specific multilateral rules, the provisions of 
this subparagraph do not apply to that product. 
26 Not later than 18 months after the date of entry into force of the WTO Ag reement, the Committee on 
Subsidies and Countervailing Measures provided for in Ar ticle 24 (referred to in this Agreement as "the 
Committee")  shall review the operation of the provisions of subparagraph 2(a) with a view to making all 
necessary modifications to improve the operation of these provisions.  In its consideration of possible 
modifications, the Committee shall carefully review the definitions of the categories set forth in this subparagraph in the light of the experience of Members in the operation of research programmes and the work 
in other relevant international institutions. 
27 The provisions of this Agreement do not apply to fundamental research activities independently 
conducted by higher education or research establishments.  The term "fundamental research" means an 
enlargement of general scientific and technical knowle dge not linked to industrial or commercial objectives. 
28 The allowable levels of non-actiona ble assistance referred to in this subparagraph shall be established 
by reference to the total eligible costs incurred over the duration of an individual project. 
29 The term "industrial research" means planned search  or critical investigati on aimed at discovery of 
new knowledge, with the objective that such knowledge may be useful in developing new products, processes or 
services, or in bringing about a significant improvement to existing products, processes or services. 
30 The term "pre-competitive development activity" means  the translation of industrial research 
findings into a plan, blueprint or design for new, modified or improved products, processes or services whether 
intended for sale or use, including the creation of a first prototype which would not be capable of commercial 
use.  It may further include the concep tual formulation and design of products,  processes or services alternatives 
and initial demonstration or pilot projects, provided that  these same projects cannot be converted or used for 
industrial application or commercial exploitation.  It does not include routine or periodic alterations to existing 
products, production lines, manufacturing processes, services, and other on-going operations even though those alterations may represent improvements. 
31 In the case of programmes which span industrial research and pre-competitive development activity, 
the allowable level of non-actionable assistance shall not exceed the simple average of the allowable levels of 
non-actionable assistance applicable to the above two categories, calculated on  the basis of all eligible costs as 
set forth in items (i) to (v) of this subparagraph. TN/RL/W/236 
Page 46  
 
  and provided that such assistance is limited exclusively to: 
 
(i) costs of personnel (researchers, technicians and other supporting staff 
employed exclusively in the research activity); 
 
(ii) costs of instruments, equipment, land and buildings used exclusively and 
permanently (except when disposed of on a commercial basis) for the 
research activity; 
 
(iii) costs of consultancy and equivalent services used exclusively for the research 
activity, including bought-in research, technical knowledge, patents, etc.;  
 
(iv) additional overhead costs incurred dir ectly as a result of the research activity; 
 
(v) other running costs (such as those of materials, supplies and the like), 
incurred directly as a result of the research activity. 
 
(b) assistance to disadvantaged regions within  the territory of a Member given pursuant 
to a general framework of regional development
32 and non-specific (within the 
meaning of Article 2) within e ligible regions provided that: 
 
(i) each disadvantaged region must be a clearly designated contiguous 
geographical area with a definable economic and administrative identity; 
 
(ii) the region is considered as disadvantaged on the basis of neutral and 
objective criteria33, indicating that the region's difficulties arise out of more 
than temporary circumstances;  such criteria must be clearly spelled out in 
law, regulation, or other official documen t, so as to be capable of verification; 
 
(iii) the criteria shall include a measu rement of economic development which 
shall be based on at least one of the following factors: 
 
- one of either income per capita or household income per capita, or 
GDP per capita, which must not be above 85 per cent of the average for the territory concerned; 
 
- unemployment rate, which must be at least 110 per cent of the 
average for the territory concerned; 
 
as measured over a three-year period;  such measurement, however, may be a composite one and may include other factors. 
                                                     
 
32 A "general framework of regional development" mean s that regional subsidy programmes are part of 
an internally consistent and generally applicable regi onal development policy and that regional development 
subsidies are not granted in isolated geographical points having no, or virtually no, influence on the 
development of a region. 
33 "Neutral and objective criteria" means criteria which do not favour  certain regions beyond what is 
appropriate for the elimination or reduction of regi onal disparities within the framework of the regional 
development policy. In this regard, regional subsid y programmes shall include ceilings on the amount of 
assistance which can be granted to each  subsidized project. Such ceilings mu st be differentiated according to the 
different levels of development of assisted regions and must  be expressed in terms of investment costs or cost of 
job creation. Within such ceilings, the distribution of assistance shall be sufficiently broad and even to avoid the predominant use of a subsidy by, or the granting of disproportionately large amounts of subsidy to, certain 
enterprises as provided for in Article 2.  TN/RL/W/236 
 Page 47 
 
 
   
(c) assistance to promote adaptation of existing facilities34 to new environmental 
requirements imposed by law and/or regula tions which result in greater constraints 
and financial burden on firms, provided that the assistance: 
 
(i) is a one-time non-recurring measure;  and 
 
(ii) is limited to 20 per cent of the cost of adaptation;  and 
 
(iii) does not cover the cost of replacing and operating the assisted investment, 
which must be fully borne by firms;  and 
 
(iv) is directly linked to and proportio nate to a firm's planned reduction of 
nuisances and pollution, and does not c over any manufacturing cost savings 
which may be achieved;  and 
 
(v) is available to all firms which can adopt the new equipment and/or 
production processes. 
 8.3 A subsidy programme for which the provisions of paragraph 2 are invoke d shall be notified in 
advance of its implementation to the Committee in accordance with the provisions of Part VII.  Any 
such notification shall be sufficien tly precise to enable other Members to evaluate the consistency of 
the programme with the conditions and criteria provided for in the relevant provisions of paragraph 2.  
Members shall also provide the Committee with yearly updates of such notifications, in particular by 
supplying information on global expenditure for each programme, and on any modification of the 
programme.  Other Members shall have the right to request information about individual cases of 
subsidization under a notified programme.
35 
 8.4 Upon request of a Member, the Secretariat shall review a notification made pursuant to paragraph 3 and, where necessary, may require a dditional information from the subsidizing Member 
concerning the notified programme under review.  Th e Secretariat shall report its findings to the 
Committee.  The Committee shall, upon request, promptly  review the findings of the Secretariat (or, if 
a review by the Secretariat has not been requested, th e notification itself), with a view to determining 
whether the conditions and criteria laid down in pa ragraph 2 have not been met.  The procedure 
provided for in this paragraph shall be completed at  the latest at the first regular meeting of the 
Committee following the notification of a subsidy prog ramme, provided that at least two months have 
elapsed between such notification and the regular meeting of the Committee.  The review procedure 
described in this paragraph shall also apply, upon request, to substantial modifications of a 
programme notified in the yearly u pdates referred to in paragraph 3. 
 8.5 Upon the request of a Member, the dete rmination by the Committee referred to in 
paragraph 4, or a failure by the Committee to make  such a determination, as well as the violation, in 
individual cases, of the conditions set out in a notified programme, shall be submitted to binding 
arbitration.   The arbitration body shall present its  conclusions to the Members within 120 days from 
the date when the matter was referred to the arb itration body.  Except as otherwise provided in this 
paragraph, the DSU shall apply to arb itrations conducted unde r this paragraph. 
  
                                                     
 
34 The term "existing facilities" means facilities which have been in operation for at least two years at 
the time when new environmental requirements are imposed. 
35 It is recognized that nothing in this notifica tion provision requires the provision of confidential 
information, including confidential business information. TN/RL/W/236 
Page 48  
 
  Article 9  
 
Consultations and Authorized Remedies  
 
9.1 If, in the course of implementation of a progr amme referred to in paragraph 2 of Article 8, 
notwithstanding the fact that the programme is c onsistent with the criteria laid down in  that 
paragraph, a Member has reasons to believe that this programme has resulted in serious adverse 
effects to the domestic industry of that Member, su ch as to cause damage which would be difficult to 
repair, such Member may request consultations with  the Member granting or maintaining the subsidy. 
 
9.2 Upon request for consultations under paragra ph 1, the Member granting or maintaining the 
subsidy programme in question shall enter into such consultations as quickly as possible.  The 
purpose of the consultations shall be to clarify the f acts of the situation and to arrive at a mutually 
acceptable solution.  
9.3 If no mutually acceptable solution has been reach ed in consultations unde r paragraph 2 within 
60 days of the request for such consultations, th e requesting Member may refer the matter to the 
Committee.  9.4 Where a matter is referred to the Committe e, the Committee shall immediately review the 
facts involved and the evidence of the effects referred  to in paragraph 1.  If the Committee determines 
that such effects exist, it may r ecommend to the subsidizing Member to modify this programme in 
such a way as to remove these effe cts.  The Committee shall present its conclusions within 120 days 
from the date when the matter is referred to it under paragraph 3.  In the event the recommendation is 
not followed within six months, the Committee sh all authorize the requesting Member to take 
appropriate countermeasures commensurate with the na ture and degree of the effects determined to 
exist. 
  
PART V:  COUNTERVAILING MEASURES 
  
Article 10  
 
Application of Article VI of GATT 1994
36 
  Members shall take all necessary steps to en sure that the imposition of a countervailing duty
37 
on any product of the territory of any Member import ed into the territory of another Member is in 
accordance with the provisions of Article VI of  GATT 1994 and the terms of this Agreement.  
                                                      
36 The provisions of Part II or III may be invoked in parallel with the provisions of Part V;  however, 
with regard to the effects of a particular subsidy in the domestic market of the importing Member, only one form 
of relief (either a countervailing duty, if the requirements  of Part V are met, or a countermeasure under Articles 
4 or 7) shall be available. The provisions of Parts III and V shall not be invoked regarding measures considered 
non-actionable in accordance with the pr ovisions of Part IV.  However, measur es referred to in paragraph 1(a) 
of Article 8 may be investigated in order to determine whether or not they are specific within the meaning of 
Article 2.  In addition, in the case of a subsidy referre d to in paragraph 2 of Artic le 8 conferred pursuant to a 
programme which has not been notified in accordance with paragraph 3 of Article 8, the provisions of Part III or V may be invoked, but such subsidy shall be treated as non-actionable if it is found to conform to the standards 
set forth in paragraph 2 of Article 8. 
37 The term "countervailing duty" shall be understood to mean a special duty le vied for the purpose of 
offsetting any subsidy bestowed directly or indirectly upon the manufacture, production or export of any 
merchandise, as provided for in paragraph 3 of Article VI of GATT 1994.  TN/RL/W/236 
 Page 49 
 
 
  Countervailing duties may only be imposed pursuant to investigations initiated38 and conducted in 
accordance with the provisions of this Ag reement and the Agreement on Agriculture. 
  
Article 11  
 
Initiation and Subsequent Investigation  
 
11.1 Except as provided in paragraph 6, an inves tigation to determine the existence, degree and 
effect of any alleged subsidy sh all be initiated upon a written app lication by or on behalf of the 
domestic industry. 
 11.2 An application under paragraph 1 shall in clude sufficient evidence of the existence of (a) a 
subsidy and, if possible, its amount, (b) injury within the meaning of Article VI of GATT 1994 as 
interpreted by this Agreement, and (c) a causal link between the subsidized imports and the alleged 
injury.  Simple assertion, unsubstantiated by releva nt evidence, cannot be considered sufficient to 
meet the requirements of this paragraph.  The application shall contain such information as is 
reasonably available to the applicant on the following:  
(i) the identity of the applicant and a descrip tion of the volume and value of the domestic 
production of the like product by the applican t.  Where a written application is made 
on behalf of the domestic industry, the application shall identify the industry on 
behalf of which the application is made by a list of all known domestic producers of 
the like product (or associations of domestic  producers of the like product) and, to the 
extent possible, a description of the vol ume and value of domestic production of the 
like product accounted for by such producers; 
 
(ii) a complete description of the allegedly subsidized product, the names of the country 
or countries of origin or export in questi on, the identity of each known exporter or 
foreign producer and a list of known pers ons importing the product in question; 
 
(iii) evidence with regard to the existence, amount and nature of th e subsidy in question; 
 
(iv) evidence that alleged injury to a domes tic industry is caused by subsidized imports 
through the effects of the subsidies;  this evidence includes information on the 
evolution of the volume of the allegedly subsidized imports, the effect of these 
imports on prices of the like product in the domestic market and the consequent 
impact of the imports on the domestic industr y, as demonstrated by relevant factors 
and indices having a bearing on the state of the domestic industry, such as those listed in paragraphs 2 and 4 of Article 15. 
 11.3 The authorities shall review the accuracy an d adequacy of the evid ence provided in the  
application to determine whether the evidence is suffi cient to justify the initiation of an investigation. 
 
11.4 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
39 by domestic producers of the like product, that the application has been made 
                                                      
38 The term "initiated" as used hereinafter means procedural action by which a  Member formally 
commences an investigation as provided in Article 11. 
39 In the case of fragmented industries involving  an exceptionally large number of producers, 
authorities may determine support and opposition by using statistically valid sampling techniques. TN/RL/W/236 
Page 50  
 
  by or on behalf of the domestic industry.
40  The application shall be cons idered to have been made "by 
or on behalf of the domestic industry" if it is supported by those domestic producers whose collective 
output constitutes more than 50 per cent of the total production of the like product produced by that portion of the domestic industry expressing either support for 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.  11.5 The authorities shall avoid, unless a decision has been made to initiate an investigation,  any 
publicizing of the application for the initiation of  an investigation. 
 
11.6 If, in special circumstances,  the authorities concerned decide to initiate an investigation 
without having received a written application by or on behalf of a domestic industry for the initiation 
of such investigation, they shall proceed only if th ey have sufficient evidence of the existence of a 
subsidy, injury and causal link, as described in paragr aph 2, to justify the initiation of an investigation. 
 
11.7 The evidence of both subsidy and inju ry shall be considered simultaneously (a) in the 
decision whether or not to in itiate an investigation and (b) thereafter, during the course of the 
investigation, starting on a date not later than the earliest date on which in accordance with the 
provisions of this Agreement prov isional measures may be applied. 
 
11.8 In cases where products are not imported directly from the country of origin but are exported 
to the importing Member from an intermediate count ry, the provisions of this Agreement shall be 
fully applicable and the transaction or transactions  shall, for the purposes of this Agreement, be 
regarded as having taken place between the country of origin and the importing Member.  
11.9 An application under paragraph 1 shall be reje cted and an investigation shall be terminated 
promptly as soon as the authorities concerned are satis fied that there is not sufficient evidence of 
either subsidization or of injury to justify pr oceeding with the case.  There shall be immediate 
termination  in cases where the amount of a subsidy is de minimis  , or where the volume of subsidized 
imports, actual or potential, or the injury, is neglig ible.  For the purpose of this paragraph, the amount 
of the subsidy shall be considered to be de minimis  if the subsidy is less than 1 per cent ad valorem. 
 
11.10 An investigation shall not hinder the procedures of customs clearance. 
 11.11 Investigations shall, except in  special circumstances, be concluded within one year, and in no 
case more than 18 months, after their initiation. 
 
 
Article 12  
 
Evidence  
 12.1 Interested Members and all interested parti es in a countervailing duty investigation shall be 
given notice of the information which the author ities require and ample opportunity to present in 
writing all evidence which they consider relevant in respect of the investigation in question. 
 
                                                     
 
40 Members are aware that in the te rritory 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.  TN/RL/W/236 
 Page 51 
 
 
   12.1.1 Exporters, foreign producers or intere sted Members receiving questionnaires used in 
a countervailing duty investigation shall be given at least 30 days for reply.41  Due 
consideration should be given to any requ est for an extension of the 30-day period 
and, upon cause shown, such an extension should be granted whenever practicable. 
 
 12.1.2 Subject to the requirement to protect confidential information, evidence presented in 
writing by one interested Member or interested party shall be made available promptly to other interested Members or interested parties participating in the 
investigation. 
 
 12.1.3 As soon as an investigation has been initiated, the authorities shall provide the full 
text  of the written application received unde r paragraph 1 of Article 11 to the known 
exporters
42 and to the authorities of the exporting Member and shall make it available, 
upon request, to other  interested parties invol ved.  Due regard shall be paid to the 
protection of confidential information,  as provided for in paragraph 4. 
 
12.2. Interested Members and interested parties al so shall have the right, upon justification, to 
present information orally.  Where such informati on is provided orally, the interested Members and 
interested parties subsequently shall be required to  reduce such submissions to writing.  Any decision 
of the  investigating authorities can only be based on such information and arguments as were on the 
written record of this authority and which were avai lable to interested Members and interested parties 
participating in the investigation, due account having  been given to the need to protect confidential 
information.  12.3 The authorities shall whenever practicable provide timely opportunities for all interested 
Members and interested parties to see all information that is relevant to the presentation of their cases, 
that is not confidential as defined in  paragraph 4, and that is used by the authorities in a countervailing 
duty investigation, and to prepare presentations on the basis of this information.  12.4 Any information which is by nature confiden tial (for example, because its disclosure would 
be of significant competitive advantage to a competitor or because its disclosure would have a significantly adverse effect upon a person supplying th e information or upon a person from whom the  
supplier acquired the information), or which is provided on a confidential basis by parties to an 
investigation shall, upon good cause shown, be treated  as such by the authorities.   Such information 
shall not be disclosed without specific permission of the party submitting it.
43    
  12.4.1 The authorities shall require inte rested Members or interested parties 
providing confidential information to furnish non-confidential summaries 
thereof.  These summaries shall be in sufficient detail to permit a reasonable understanding of the substance of the information submitted in confidence.  
In exceptional circumstances, such Memb ers or parties may indicate that such 
information is not susceptible of  summary.  In such exceptional 
                                                     
 
41 As a general rule, the time-limit for exporters sh all be counted from the date of receipt of the 
questionnaire, which for this purpose sh all be deemed to have been receive d one week from the date on which it 
was sent to the respondent or transmitted to the approp riate diplomatic representativ es of the exporting Member 
or, in the case of a separate customs territory Member of the WTO, an official re presentative of the exporting 
territory. 
42 It being understood that where the number of exporters involved is particularly high, the full text of 
the application should instead be provided only to the authorities of the exporting Member or to the relevant 
trade association who then should forwar d copies to the exporters concerned. 
43 Members are aware that in the te rritory of certain Members disclosure pursuant to a narrowly-drawn 
protective order may be required.  TN/RL/W/236 
Page 52  
 
  circumstances, a statement of the re asons why summarization is not possible 
must be provided. 
 
12.4.2 If the authorities find that a request for confidentiality is not warranted and if 
the supplier of the information is e ither unwilling to make the information 
public or to authorize its disclosure in generalized or summary form, the 
authorities may disregard such information unless it can be demonstrated to their satisfaction from appropriate sources that the information is correct.
44 
 12.5 Except in circumstances provided for in paragr aph 7, the authorities shall during the course of 
an investigation satisfy themselves as to the accu racy of the information supplied by interested 
Members or interested parties upon which their findings are based.  12.6 The investigating authorities may carry out inves tigations in the territory of other Members as 
required, provided that they have notified in good time the Member in question and unless that 
Member objects to the investigation.  Furthe r, the investigating authorities may carry out 
investigations on the premises of a firm and may examine the records of a firm if (a) the firm so 
agrees and (b) the Member in question is notified and does not object.   The procedures set forth in 
Annex VI shall apply to investigations on the prem ises of a firm.  Subject to the requirement to 
protect confidential information, the authorities sha ll make the results of any such investigations 
available, or shall provide disclosure thereof pursu ant to paragraph 8, to the firms to which they 
pertain and may make such results available to the applicants. 
 12.7 In cases in which any interested Member or interested party refuses access to, or otherwise 
does not provide, necessary information within a reasonable period or significantly impedes the investigation, preliminary and fina l determinations, affirmative or ne gative, may be made on the basis 
of the facts available. 
 12.8 The authorities shall, before a final determina tion is made, inform all interested Members and 
interested parties of the essential facts under consid eration which form the basis for the decision 
whether to apply definitive measures.   Such di sclosure should take place in sufficient time for the 
parties to defend their interests. 
 
12.9 For the purposes of this Agreement,  "interested parties" shall include: 
 
(i) an exporter or foreign producer or the im porter of a product subjec t to investigation, 
or a trade or business association a majority  of the members of which are producers, 
exporters or importers of such product;  and 
 
(ii) a producer of the like product in the importing Member or a trade and business 
association a majority of the members of which produce the like product in the territory of the importing Member. 
 
This list shall not preclude Members from allowing  domestic or foreign parties other than those 
mentioned above to be included as interested parties.  12.10 The authorities shall provide opportunities for industrial users of the product under investigation, and for representative consumer orga nizations in cases where the product is commonly 
                                                     
 
44 Members agree that requests for confidentiality shoul d not be arbitrarily rejected.   Members further 
agree that the investigating authority may request the waiving of confidentiality only regarding information 
relevant to the proceedings.  TN/RL/W/236 
 Page 53 
 
 
  sold at the retail level, to provide information which is relevant to the investigation regarding 
subsidization, injury and causality.  12.11 The authorities shall take due account of any di fficulties experienced by interested parties, in 
particular small companies, in supplying inform ation requested, and shall provide any assistance 
practicable. 
 12.12 The procedures set out above are not intended to prevent the authorities of a Member from 
proceeding expeditiously with regard to initiating an investigation, reaching preliminary or final 
determinations, whether affirmative or negative, or from applying provisional or final measures, in 
accordance with relevant provisions of this Agreement. 
  
Article 13  
 
Consultations  
 
13.1 As soon as possible after an application under Article 11 is accepted, and in any event before 
the initiation of any investigation, Members th e products of which may be subject to such 
investigation shall be invited for consultations with the aim of clarifying the situation as to the matters 
referred to in paragraph 2 of  Article 11 and arriving at a mutually agreed solution. 
 
13.2 Furthermore, throughout the period of inves tigation, Members the products of which are the 
subject of the investigation shall be afforded a re asonable opportunity to con tinue consultations, with 
a view to clarifying the factual situation and to arriving at a mutually agreed solution.
45 
 
13.3 Without prejudice to the obligation to afford  reasonable opportunity for consultation, these 
provisions regarding consultations  are not intended to prevent the authorities of a Member from 
proceeding expeditiously with regard to initiating the investigation, reaching preliminary or final 
determinations, whether affirmative or negative, or from applying provisional or final measures, in 
accordance with the provisions of this Agreement.  
13.4 The Member which intends to initiate any inv estigation or is conducting such an investigation 
shall permit, upon request, the Member or Members the products of which are subject to such  
investigation access to non-confidential eviden ce, including the non-confidential summary of 
confidential data being used for initia ting or conducting the investigation. 
 
 
Article 14  
 
Calculation of the Amount of a Subsidy in Terms of the Be
nefit to the Recipient  
 
14.1 For the purpose of Part V, any method used by the investigating authority to calculate the 
benefit to the recipient conferred pursuant to para graph 1 of Article 1 shall be provided for in the 
national legislation or implementing regulations of the Member concerned and its application to each 
particular case shall be transparen t and adequately explained.  Furt hermore, any such method shall be 
consistent with the following guidelines:   
                                                     
 
45 It is particularly important, in accordance with the provisions of this paragraph, that no affirmative 
determination whether preliminary or final be made without reasonable opportunity for consultations having 
been given. Such consultations may establish the basis for proceeding under the provisions of Part II, III or X. TN/RL/W/236 
Page 54  
 
  (a) government provision of equity capital shall not be considered as conferring a benefit, 
unless the investment decision can be rega rded as inconsistent with the usual 
investment practice (including for the provision of risk capital) of private investors in the territory of that Member; 
 
(b) a loan by a government shall not be cons idered as conferring a benefit, unless there is 
a difference between the amount that the firm receiving the loan pays on the government loan and the amount the firm  would pay on a comparable commercial 
loan which the firm could actually obtain on the market.  In this case the benefit shall 
be the difference between these two amounts; 
 
(c) a loan guarantee by a government shall not be considered as conferring a benefit, 
unless there is a difference between the amount that the firm receiving the guarantee pays on a loan guaranteed by the government  and the amount that the firm would pay 
on a comparable commercial loan absent the government guarantee.   In this case the 
benefit shall be the difference between these two amounts adjusted for any 
differences in fees; 
 
 [CERTAIN FINANCING BY LOSS-MAKING INSTITUTIONS:  There are significant 
differences of view as to whether a new provision should be introduced that would establish a benchmark for determining the existence of a benefit in the case of 
government loans or guarantees provided by institutions incurring long-term operating 
losses, and/or financing to state-owned enterprises that are not creditworthy or equityworthy.  Proponents consider that such a provision would clarify the Agreement's treatment of an important form of trade-distortive financing, some delegations are concerned over how the key concepts could be defined, and others are categorically 
opposed, including because they see such a provision as discriminating against state-
owned enterprises.] 
 
(d) the provision of goods or services or purchase of goods by a government shall not be 
considered as conferring a benefit unless the pr ovision is made for less than adequate 
remuneration, or the purchase is made for more than adequate remuneration.   The  
adequacy of remuneration shall be determ ined in relation to prevailing market 
conditions for the good or service in question in the country of provision or purchase 
(including price, quality, availability,  marketability, transportation and other 
conditions of purchase or sale).  Where the price level of goods or services provided 
by a government is regulated, the adequacy of remuneration shall be determined in 
relation to prevailing market  conditions for the goods or services in the country of 
provision when sold at unregulated prices,  adjusting for quality, availability, 
marketability, transportation and other conditions  of sale; provided that, when there is  
no unregulated price, or such unregulated price is distorted because of the 
predominant role of the government in the ma rket as a provider of the same or similar 
goods or services, the adequacy of remuneration may be determined by reference to 
the export price for these goods or services, or to a market-determined price outside 
the country of provision, adjusting fo r quality, availability, marketability, 
transportation, and other conditions of sale.    
 14.2 For the purpose of Part V, where a subsidy is granted in respect of an input used to produce 
the product under consideration, and the producer of  the product under consideration is unrelated to 
the producer of the input, no benefit from the subsidy in respect of the input shall be attributed to the 
product under consideration unless a determination h as been made that the producer of the product  TN/RL/W/236 
 Page 55 
 
 
  under consideration obtained the input on terms more  favourable than otherw ise would have been 
commercially available to that producer in the market.46 
 14.3 For the purpose of Part V, the methods used by  the investigating authority to attribute subsidy 
benefits to particular time periods sha ll be consistent with the following guidelines:47 
 
 (a) With the exception of benefits from lo an subsidies and similar subsidized debt 
instruments, subsidy benefits shall either be  expensed in full in the year of receipt 
("expensed") or allocated over a period of  years ("allocated").  Expensed subsidies 
shall be deemed to benefit the recipient by th e full amount of the benefit in the year in 
which they are expensed, whereas allocated subsidies shall be deemed to benefit the 
recipient throughout the allocation period.  Loan subsidies, and similar subsidized 
debt instruments, shall be deemed to benefit the recipient throughout the period in 
which the loan or debt instrument remains outstanding.  
 
 (b) Benefits from subsidies arising from th e following types of measures normally shall 
be expensed:  direct tax exemptions and deductions;  exemptions from and excessive 
rebates of indirect taxes or import duties;  provision of goods and services for less 
than adequate remuneration;  price support payments;  discounts on electricity, water, 
and other utilities;  freight subsidies;  export promotion assistance;  early retirement 
payments;  worker assistance;  worker training;  and wage subsidies.  
 
 (c) Benefits from subsidies arising from th e following types of measures normally shall 
be allocated:  equity infusions;  grants;  pl ant closure assistance;  debt forgiveness;  
coverage for an operating loss;  debt-to-e quity conversions;  provision of non-general 
infrastructure;  and provision of plant and equipment.  
 
 (d) In determining whether a subsidy listed in paragraph 3(b) is more appropriately 
allocated, or whether a subsidy listed in paragraph 3(c) is more appropriately 
expensed, and in determining whether a s ubsidy of a type not listed in either 
paragraph 2(b) or 2(c) should be allocat ed or expensed, the following non-exhaustive 
list of factors shall be considered:  
 
  (i) whether the subsidy is non-recurri ng (e.g., one-time, exceptional, requiring 
express government approval) or recurring48 
   (ii) the purpose of the subsidy
49;  and  
 
  (iii) the size of the subsidy.50 
                                                      
46 Where, however, it has been established that the e ffect of the subsidy is so substantial that other 
relevant prices available to the producer of the product under consideration are distorted and do not reasonably 
reflect commercial prices that would prevail in the abse nce of the subsidization, other sources, such as world 
market prices, can be used as the ba sis for the determination in question.  
47 The reference in this paragraph to particular measures does not mean that those measures will 
necessarily constitute specific subsidies;  rather, a dete rmination regarding the existence of a specific subsidy 
shall be made pursuant to Part I of the Agreement in the light of the facts of a particular case.  
48 The fact that a subsidy is non-recurring normally will be indicative of allo cation.  The fact that a 
subsidy is recurring normally will be indicative of expensing.  
49 For example, the fact that a subsidy is tied to the capital assets or structure of the recipient normally 
will be indicative of allocation.  The fact that a subsidy is tied to a firm's regular, ongoing production and sales 
activities (e.g., wages) normally will be indicative of expensing.  
50 The fact that a subsidy is large normally will be i ndicative of allocation.  The fact that a subsidy is 
small normally will be indicative of expensing.  TN/RL/W/236 
Page 56  
 
   (e) The allocation period for allocated subsidies normally should correspond to the 
average useful life of the depreciable, physical  assets of the relevant industry or firm.  
  (f) Any method for measuring the amount of a llocated subsidy benefits at a particular 
point in the allocation period may reflect a reasonable measure of the time value of 
money.  
  (g) Any public notice issued pursuant to para graph 3 of Article 22 shall include a full 
description and adequate explanation of the allocation and expensing methodologies 
used.  
 
 
Article 15  
 
Determination of Injury51 
 
15.1 A determination of injury for purposes of Ar ticle VI of GATT 1994 shall be based on positive 
evidence and involve an obj ective examination of both (a) the volume of the subsidized imports and 
the effect of the subsidized imports on pr ices in the domestic market for like products52 and (b) the 
consequent impact of these imports on the domestic producers of such products. 
 
15.2 With regard to the volume of the subsidi zed imports, the investigating authorities shall 
consider whether there has been a significant increase in subsidized imports, either in absolute terms 
or relative to production or consumption in the importi ng Member.   With regard to the effect of the 
subsidized imports on prices, the investigating au thorities shall consider whether there has been a 
significant price undercutting by the subsidized impor ts as compared with the price of a like product 
of the importing Member, or whether the effect of such imports is otherwise to depress prices to a 
significant degree or to prevent price increases, whic h otherwise would have occurred, to a significant 
degree.   No one or several of these factors can necessarily give decisive guidance.     15.3 Where imports of a product from more than one country are simultaneously subject to countervailing duty investigations, the investigating authorities may cumulatively assess the effects of 
such imports only if they determine that (a) the amount of subsidization established in relation to the 
imports from each country is more than de minimis  as defined in paragraph 9 of Article 11 and the 
volume of imports from each count ry is not negligible and (b) a cumulative assessment of the effects 
of the imports is appropriate in light of the c onditions of competition between the imported products 
and the conditions of competition between the im ported products and the li ke domestic product. 
 
15.4 The examination of the impact of the s ubsidized imports on the domestic industry shall 
include an evaluation of all relevant economic fact ors and indices having a bearing on the state of the 
industry, including actual and potential decline in out put, sales, market share, profits, productivity, 
return on  investments, or utilization of capacity;  factors affecting domestic prices;  actual and potential negative effects on cash flow, inventories,  employment, wages, growth, ability to raise 
capital or investments and, in the case of agricu lture, whether there has been an increased burden on 
                                                     
 
51 Under this Agreement the term "injury" shall, unless otherwise specified, be taken to mean material 
injury to a domestic industry, threat of material injury to a domestic industry or material retardation of the establishment of such an industry an d shall be interpreted in accordance wi th the provisions of this Article. 
52 Throughout this Agreement the term "like product" ("produit similaire") shall be interpreted to mean 
a product which is identical, i.e. alike in all respects to th e product under consideration, or in the absence of such 
a product, another product which, although not alike in  all respects, has characteristics closely resembling those 
of the product under consideration.  TN/RL/W/236 
 Page 57 
 
 
  government support programmes.  This list is not exha ustive, nor can one or several of these factors 
necessarily give decisive guidance.  15.5 It must be demonstrated that the subsidized imports are, through the effects
53 of subsidies,  
causing injury within the meaning of this Agreem ent.  The demonstration of a causal relationship 
between the subsidized imports and the injury to the domestic industry shall be based on an 
examination of all relevant evidence before the au thorities.  The authorities shall also examine any 
known factors other than the subsidized imports wh ich at the same time are injuring the domestic 
industry, and the injuries caused by these other fact ors must not be attributed to the subsidized 
imports.  Factors which may be re levant in this respect include, inter alia , the volumes and prices of 
non-subsidized imports of the product in question, c ontraction in demand or changes in the patterns of 
consumption, trade restrictive practices of a nd competition between the foreign and domestic 
producers, developments in technology and the expor t performance and productivity of the domestic 
industry.  
15.6 The effect of the subsidized imports shall be assessed in relation to the domestic production of 
the like product when available data permit the sep arate identification of that production on the basis 
of such criteria as the production process, producers' sales and profits.  If such separate identification 
of that production is not possible, the effects of  the subsidized imports shall be assessed by the 
examination of the production of the narrowest gr oup or range of products, which includes the like 
product, for which the necessary information can be provided. 
 
15.7 A determination of a threat of material in jury shall be based on facts and not merely on 
allegation, conjecture or remote possibility.   The change in circumstances which would create a 
situation in which the subsidy would cause injury mu st be clearly foreseen and imminent.   In making 
a determination  regarding the existence of a threat  of material injury, the investigating authorities 
should consider, inter alia , such factors as:   
 
(i) nature of the subsidy or subsidies in question and the trade effects likely to arise 
therefrom;   
 
(ii) a significant rate of increase of subs idized imports into the domestic market 
indicating the likelihood of substa ntially increased importation;   
 
(iii) sufficient freely disposable, or an immi nent, substantial increase in, capacity of the 
exporter indicating the likelihood of substantia lly increased subsidized exports to the 
importing Member's market, taking into account the availability of other export 
markets to absorb any additional exports;   
 
(iv) whether imports are entering at prices that will have a significant depressing or 
suppressing effect on domestic prices, and would likely increase demand for further 
imports;  and 
 
(v) inventories of the product being investigated.   
 No one of these factors by itself can necessarily give decisive guidance but the totality of the factors 
considered must lead to the conclusion that furt her subsidized exports are imminent and that, unless 
protective action is taken, material injury would occur. 
 
15.8 With respect to cases where injury is thr eatened by subsidized imports, the application of 
countervailing measures shall be consider ed and decided with special care. 
                                                     
 
53 As set forth in paragraphs 2 and 4. TN/RL/W/236 
Page 58  
 
  Article 16  
 
Definition of Domestic Industry  
 
16.1 For the purposes of this Agre ement, the term "domestic industry" shall, except as provided in 
paragraph 2, be interpreted as referring to the domest ic producers as a whole of the like products or to 
those of them whose collective output of the prod ucts constitutes a major proportion of the total  
domestic production of those products, except that when producers are related
54 to the exporters or 
importers or are themselves importers of the alle gedly subsidized product or a like product from other 
countries, the term "domestic industry" may be interp reted as referring to the rest of the producers. 
 
16.2. 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 ex ist even where a major portion of the total domestic 
industry is not injured, provided there is a concentra tion of subsidized imports into such an isolated 
market and provided further that the subsidized im ports are causing injury to the producers of all or 
almost all of the production within such market.  
16.3 When the domestic industry has been interp reted as referring to the producers in a certain 
area,  i.e. a market as defined in paragraph 2, countervailing duties shall be levied only on the 
products in question consigned for fi nal consumption to that area.   When the constitutional law of the 
importing Member does not permit the levying of countervailing duties on such a basis, the importing Member may levy the countervailing duties without limitation only if (a) the exporters shall have 
been given an opportunity to cease exporting at subs idized prices to the area concerned or otherwise 
give assurances pursuant to Article 18, and adequate assurances in this regard have not been promptly 
given, and  (b) such duties cannot be levied only on products of specific producers which supply the 
area in question.  16.4 Where two or more countries have reached  under the provisions of paragraph 8(a) of 
Article XXIV of GATT 1994 such a level of integrati on that they have the characteristics of a single, 
unified market, the industry in the entire area of in tegration shall be taken to  be the domestic industry 
referred to in paragraphs 1 and 2.  16.5 The provisions of paragraph 6 of Article  15 shall be applicable to this Article. 
 
 
Article 17  
 
Provisional Measures  
 17.1 Provisional measures may be applied only if:   
 
                                                     
 
54 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 exercise restraint or 
direction over the latter.  TN/RL/W/236 
 Page 59 
 
 
  (a) an investigation has been initiated in acco rdance with the provisions of Article 11,  a 
public notice has been given to that effect  and interested Members and interested 
parties have been given adequate oppor tunities to submit information and make 
comments;    
 
(b) a preliminary affirmative determination has been made that a subsidy exists and that 
there is injury to a domestic industry caused by subsidized imports;  and 
 
(c) the authorities concerned judge such me asures necessary to prevent injury being 
caused during the investigation.   
 
17.2 Provisional measures may take the form of  provisional countervailing duties guaranteed by 
cash deposits or bonds equal to the amount of the provisionally calculated amount of subsidization. 
 17.3 Provisional measures shall not be applied s ooner than 60 days from the date of initiation of 
the investigation. 
 17.4 The application of provisional measures shall be limited to as short a period as possible, not exceeding four months.    17.5 The relevant provisions of Article 19 shall be followed in the application of provisional 
measures. 
  
Article 18  
 
Undertakings  
 
18.1 Proceedings may
55 be suspended or terminated w ithout the imposition of provisional 
measures or countervailing duties upon receipt of sa tisfactory voluntary undertakings under which: 
 
(a) the government of the exporting Member agrees to eliminate or limit the 
subsidy or take other measures concerning its effects;  or 
 
(b) the exporter agrees to revise its prices so  that the investigating  authorities are 
satisfied that the injurious effect of the subsidy is  eliminated.   Price 
increases under such undertakings shall not be higher  than necessary to 
eliminate the amount of the subsidy.     It is desirable  that the price increases 
be less than the amount of the subsidy if such  increases would be adequate to remove the injury to the domestic industry. 
 18.2 Undertakings shall not be sought or accepted unless the authorities of the importing Member  have made a preliminary affirma tive determination of subsidization and injury caused by such 
subsidization and, in case of undertakings from e xporters, have obtained the consent of the exporting 
Member.   18.3 Undertakings offered need not be accepte d if the authorities of the importing Member 
consider their acceptance impractical , for example if the number of actual or potential exporters is too 
great, or for other reasons, including reasons of  general policy.  Should the case arise and where 
practicable, the authorities shall provide to the expor ter the reasons which have led them to consider 
                                                     
 
55 The word "may" shall not be interpreted to allow the simultaneous continuation of proceedings with 
the implementation of undertakings, except as provided in paragraph 4. TN/RL/W/236 
Page 60  
 
  acceptance of an undertaking as inappropriate, and shall,  to the extent possible, give the exporter an 
opportunity to make comments thereon.  18.4 If an undertaking is accepted, the investigation of subsidization and inju ry shall nevertheless 
be completed if the exporting Member so desires or the importing Member so d ecides.  In such a case, 
if a negative determination of subsidization or in jury is made, the undertaking shall automatically 
lapse, except in cases where such a determination is due in large part to the existence of an 
undertaking.  In such cases, the au thorities concerned may require that an undertaking be maintained 
for a reasonable  period consistent with the provisi ons of this Agreement.  In the event that an 
affirmative determination of s ubsidization and injury is made, the undertaking shall continue 
consistent with its terms and the provisions of this Agreement. 
 18.5 Price undertakings may be suggested by the authorities of the importing Member, but no exporter shall be forced to enter into such undertak ings.   The fact that governments or exporters do 
not offer such undertakings, or do not accept an invitation to do so, shall in no way prejudice the 
consideration of the case.  However, the authorities are free to determine that a threat of injury is more 
likely to be realized if the subsidized imports continue.  18.6 Authorities of an importing Member may require any government or exporter from whom an  undertaking has been accepted to provide periodically information relevant to the fulfilment of such 
an undertaking, and to permit verification of pertinen t data.   In case of violation of an undertaking, 
the  authorities of the importing Member may take , under this Agreement in conformity with its 
provisions, expeditious actions wh ich may constitute immediate app lication of provisional measures 
using the best information available.  In such cas es, definitive duties may be levied in accordance with 
this Agreement on products entered for consumption not more than 90 days before the application of 
such provisional  measures, excep t that any such retroactive assessment shall not apply to imports 
entered before the violation of the undertaking. 
  
Article 19  
 
Imposition and Collection of Countervailing Duties  
 
19.1 If, after reasonable efforts have been made to  complete consultations, a Member makes a final 
determination of the existence and amount of the s ubsidy and that, through the effects of the subsidy, 
the subsidized imports are causing injury, it may impose a countervailing duty in accordance with the 
provisions of this Article unless the s ubsidy or subsidies are withdrawn. 
 
19.2 The decision whether or not to impose a c ountervailing duty in cases where all requirements 
for the imposition have been fulfilled, and the deci sion whether the amount of the countervailing duty 
to be imposed shall be the full amount of the subs idy or less, are decisions to be made by the 
authorities of the importing Member.   It is desirable that the imposition should be permissive in the territory of all Members, that the duty should be less than the total amount of the subsidy if such 
lesser duty would be adequate to remove the injury  to the domestic industry, and that procedures 
should be established which would allow the au thorities concerned to take due account of 
representations made by domestic interested parties
56 whose interests might be adversely affected by 
the imposition of a countervailing duty.   
19.3 When a countervailing duty is imposed in r espect of any product, such countervailing duty 
shall be levied, in the appropriate amounts in each  case, on a non-discriminatory basis on imports of 
                                                     
 
56 For the purpose of this paragraph, the term "domestic interested parties" shall include consumers and 
industrial users of the imported product subject to investigation.  TN/RL/W/236 
 Page 61 
 
 
  such product from all sources found to be subsidized  and causing injury, except as to imports from 
those sources which have renounced any subsidies in question or from which undertakings under the 
terms of this Agreement have been accepted.   An y exporter whose exports are subject to a definitive 
countervailing duty but who was not actually investigated for reasons  other than a refusal to  
cooperate, shall be entitled to an e xpedited review in order that the investigating authorities promptly 
establish an individual countervailing duty rate for that exporter. 
 19.4 No countervailing duty shall be levied
57 on any imported product in excess of the amount of 
the subsidy found to exist, calculated in terms of s ubsidization per unit of the subsidized and exported 
product. 
 
 
Article 20  
 
Retroactivity  
 
20.1 Provisional measures and countervailing duties sh all only be applied to products which enter 
for consumption after the time when the decision unde r paragraph 1 of Article 17 and paragraph 1 of 
Article 19, respectively, enters into force, s ubject to the exceptions set out in this Article. 
 20.2 Where a final determination of injury (but not of a threat thereof or of a material retardation 
of the establishment of an industry) is made or, in  the case of a final determination of a threat of 
injury, where the effect of the subsidized imports  would, in the absence of the provisional measures, 
have led to a determination of in jury, countervailing duties may be levied retroactively for the period 
for which provisional measures, if any, have been applied.  
20.3 If the definitive countervailing duty is highe r than the amount guaranteed by the cash deposit 
or bond, the difference shall not be collected.   If the definitive duty is less than the amount 
guaranteed by the cash deposit or bond, the excess am ount shall be reimbursed or the bond released in 
an expeditious manner.  20.4 Except as provided in paragraph 2, where a dete rmination of threat of injury or material 
retardation is made (but no injury has yet occu rred) a definitive countervailing duty may be imposed 
only from the date of the determin ation of threat of injury or material retardation, and any cash 
deposit made during the period of the application of provisional measures shall be refunded and any 
bonds released in an expeditious manner.  
20.5 Where a final determination is negative, any cash deposit made during the period of the 
application of provisional measures shall be ref unded and any bonds released in an expeditious 
manner.  20.6 In critical circumstances where for the subsid ized product in question the authorities find that 
injury which is difficult to repair  is caused by massive imports in a relatively short period of a product 
benefiting from subsidies paid or bestowed inconsistently with the provisions of GATT 1994 and of 
this Agreement and where it is deemed necessary, in  order to preclude the recurrence of such injury, 
to assess countervailing duties retroactively on tho se imports, the definitive countervailing duties may 
be assessed on imports which were entered for consumption not more th an 90 days prior to the date of 
application of provisional measures. 
 
 
                                                     
 
57 As used in this Agreement "levy" shall mean the definitive or final legal assessment or collection of a 
duty or tax. TN/RL/W/236 
Page 62  
 
  Article 21  
 
Duration and Review of Countervailing Duties and Undertakings  
 
21.1 A countervailing duty shall remain in force only as long as and to the extent necessary to 
counteract subsidization which is causing injury. 
 21.2 The authorities shall review the need fo r the continued imposition of the duty, where 
warranted, on their own initiative or, provided that  a reasonable period of time has elapsed since the 
imposition of the definitive countervailing duty, upon  request by any interested party which submits 
positive  information substantiating the need for a revi ew.  Interested parties shall have the right to 
request the authorities to examine whether the con tinued imposition of the duty is necessary to offset 
subsidization, whether the injury would be likely to  continue or recur if the duty were removed or 
varied, or both.  If, as a result of the review under this paragraph, the authorities determine that the 
countervailing duty is no longer warranted, it shall be terminated immediately. 
 
21.3 Notwithstanding the provisions of paragraphs 1 and 2, any de finitive countervailing duty shall 
be terminated on a date not later than five year s from its imposition (or from the date of the most 
recent review under paragraph 2 if that review has covered both subsidization and injury, or under this 
paragraph), unless the authorities determine, in a review initiated before that date on their own 
initiative or upon a duly substantiated request made by or on behalf of the domestic industry within a 
reasonable period of time prior to that date, that the expiry of the duty would be likely to lead to 
continuation or recurrence of subsidization and injury.
58  The duty may remain in force pending the 
outcome of such a review.  21.4 The provisions of Article 12 regarding evid ence and procedure shall apply to any review 
carried out under this Article.  Any such review sh all be carried out expeditiously and shall normally 
be concluded within 12 months of th e date of initiation of the review. 
 21.5 The provisions of this Article shall apply mutatis mutandis  to undertakings accepted under 
Article 18.  
Article 22  
 
Public Notice and Explanation of  
Determinations  
 22.1 When the authorities are satisfied that there is  sufficient evidence to justify the initiation  of 
an investigation pursuant to Article 11, the Member  or Members the products of which are subject to 
such investigation and other interested parties known to the investigating authorities to have an 
interest therein shall be notified a nd a public notice shall be given. 
 22.2 A public notice of the initiation of an investiga tion shall contain, or otherwise make available 
through a separate report
59, adequate information on the following: 
 
(i) the name of the exporting country or countries and the product involved; 
 
                                                      
58 When the amount of the countervailing duty is a ssessed on a retrospective basis, a finding in the 
most recent assessment proceeding that no duty is to be levied shall not by itself require the authorities to 
terminate the definitive duty. 
59 Where authorities provide information and explanatio ns under the provisions of this Article in a 
separate report, they shall ensure that such  report is readily available to the public.  TN/RL/W/236 
 Page 63 
 
 
  (ii) the date of initiation of the investigation; 
 
(iii) a description of the subsidy practice or practices to be investigated; 
 
(iv) a summary of the factors on which the  allegation of injury is based; 
 
(v) the address to which representations by interested Members and interested 
parties should be directed;  and  
 
(vi) the time-limits allowed to interested Members and interested parties for 
making their views known. 
 22.3 Public notice shall be given of any preliminar y or final determination, whether affirmative or 
negative, of any decision to accept an undertaking purs uant to Article 18, of the termination of such 
an undertaking, and of the termination of a defin itive countervailing duty.  Each such notice shall set 
forth, or otherwise make available through a separate report, in sufficient detail the findings and 
conclusions reached on all issues of fact and law cons idered material by the investigating authorities.  
All such notices and reports shall be forwarded to the Member or Members the products of which are 
subject to such determination or undertaking and to ot her interested parties known to have an interest 
therein.  
22.4 A public notice of the imposition of provisional measures shall set forth, or otherwise make 
available through a separate report, sufficiently  detailed explanations for the preliminary 
determinations on the existence of a subsidy and inju ry and shall refer to the matters of fact and law 
which have led to arguments being accepted or rejected.  Such a notice or report shall, due regard 
being paid to the requirement for the protection of  confidential information, contain in particular: 
 
(i) the names of the suppliers or, when  this is impracticable, the supplying 
countries involved; 
 
(ii) a description of the  product which is sufficient for customs purposes; 
 
(iii) the amount of subsidy established a nd the basis on which the existence of a 
subsidy has been determined; 
 
(iv) considerations relevant to the inju ry determination as set out in Article 15; 
 
(v) the main reasons leading to the determination. 
 22.5 A public notice of conclusion or suspension of an investigation in the case of an affirmative 
determination providing for the imposition of a de finitive duty or the acceptance of an undertaking 
shall contain, or otherwise make available throug h a separate report, all relevant information on the 
matters of fact and law and reasons which have  led to the imposition of final measures or the 
acceptance of an undertaking, due regard being pa id to the requirement for the protection of 
confidential information.  In particular, the notice or report shall contain the information described in 
paragraph 4, as well as the reasons for the acceptance or rejection of relevant arguments or claims 
made by interested Members and by the exporters and importers. 
 
22.6 A public notice of the termination or suspensi on of an investigation following the acceptance 
of an undertaking pursuant to Article 18 shall incl ude, or otherwise make available through a separate 
report, the non-confidential part of this undertaking.  TN/RL/W/236 
Page 64  
 
  22.7 The provisions of this Article shall apply mutatis mutandis  to the initiation and completion of 
reviews pursuant to Article 21 and to decisions under Article 20 to apply duties retroactively. 
  
Article 23  
 
Judicial Review  
 
 Each Member whose national legislation contains provisions on countervailing  duty 
measures shall maintain judicial, arbitral or admi nistrative tribunals or procedures for the purpose, 
inter alia , of the prompt review of administrative actions  relating to final dete rminations and reviews 
of  determinations within the meaning of Artic le 21.  Such tribunals or procedures shall be 
independent of the authorities responsible for the determination or review in question, and shall 
provide all interested parties who participated in  the administrative proceeding and are directly and 
individually affected by the administrative actions with access to review. 
 
 
PART VI:  INSTITUTIONS 
  
Article 24  
 
Committee on Subsidies and Countervailing Measures  
and Subsidiary Bodies  
 
24.1 There is hereby established a Committ ee on Subsidies and Countervailing Measures 
composed of representatives from each of the Member s.  The Committee shall elect its own Chairman 
and shall meet not less than twice a year and otherw ise as envisaged by relevant provisions of this 
Agreement at the request of any Member.  The Committee shall carry out responsibilities as assigned 
to it under this Agreement or by the Members and it shall afford Members the opportunity of 
consulting on any matter relating to the operation of the Agreement or the furtherance of its 
objectives.  The WTO Secretariat shall ac t as the secretariat to the Committee. 
 
24.2 The Committee may set up subsidiary bodies as appropriate.  24.3 The Committee shall establish a Permanent Group of Experts composed of five independent 
persons, highly qualified in the fields of subsidies and trade relations.  The experts will be elected by 
the Committee and one of them will be replaced ever y year.  The PGE may be requested to assist a 
panel, as provided for in paragraph 5 of Article 4.   The Committee may also seek an advisory opinion 
on the existence and nature of any subsidy.  24.4 The PGE may be consulted by any Member and may give advisory opinions on the nature of 
any subsidy proposed to be introduced or currently  maintained by that Member.  Such advisory 
opinions will be confidential and may not be  invoked in proceedings under Article 7. 
 24.5 In carrying out their functions, the Committe e and any subsidiary bodies may consult with 
and seek information from any source they deem ap propriate.  However, before the Committee or a 
subsidiary body seeks such information from a sour ce within the jurisdiction of a Member, it shall 
inform the Member involved. 
   TN/RL/W/236 
 Page 65 
 
 
  PART VII:  NOTIFICATION AND SURVEILLANCE 
  
Article 25  
 
Notifications  
 
25.1 Members agree that, without prejudice to the provisions of paragraph 1 of Article XVI of 
GATT 1994, their notifications of subsidies shall be  submitted not later than 30 June of each second 
year and shall conform to the provisions of paragraphs 2 through 6. 
 
25.2 Members shall notify any subsidy as defined in  paragraph 1 of Article 1, which is specific 
within the meaning of Article 2, granted or maintained within their territories.  25.3 The content of notifications should be sufficiently specific to enable other Members to 
evaluate the trade effects and to understand the ope ration of notified subsidy programmes.  In this 
connection, and without prejudice to the conten ts and form of the questionnaire on subsidies
60, 
Members shall ensure that their notifica tions contain the following information: 
 
(i) form of a subsidy (i.e. grant, loan, tax concession, etc.); 
 
(ii) subsidy per unit or, in cases where this is not possible, the total amount or the 
annual  amount budgeted for that subsidy (indicating, if possible, the average subsidy per unit in the previous year); 
 
(iii) policy objective and/or purpose of a subsidy; 
 
(iv) duration of a subsidy and/or a ny other time-limits attached to it; 
 
(v) statistical data permitting an assessment of the trade effects of a subsidy. 
 25.4 Where specific points in paragraph 3 have not been addressed in a notification, an explanation 
shall be provided in the notification itself. 
 25.5 If subsidies are granted to specific products or  sectors, the notifications should be organized 
by product or sector.  
25.6 Members which consider that there are no me asures in their territories requiring notification 
under paragraph 1 of Article XVI of  GATT 1994 and this Agreement shall so inform the Secretariat in 
writing.  25.7 Members recognize that notification of a measure does not prejudge either its legal status under GATT 1994 and this Agreement, the effects under th is Agreement, or the nature of the measure 
itself. 
 25.8 Any Member may, at any time, make a wr itten request for information on the nature and 
extent of any subsidy granted or maintained by a nother Member (including any subsidy referred to in 
Part IV), or for an explanation of the reasons fo r which a specific measure has been considered as not 
subject to the requirement of notification. 
 
                                                     
 
60 The Committee shall establish a Working Party to review the contents and form of the questionnaire 
as contained in BISD 9S/193-194. TN/RL/W/236 
Page 66  
 
  25.9 Members so requested shall provide such  information as quickly as possible and in a 
comprehensive manner, and shall be ready, upon re quest, to provide additional information to the 
requesting Member.   In particular, they shall provide  sufficient details to enable the other Member to  
assess their compliance with the terms of this Agreem ent.   Any Member which considers that such 
information has not been provided may bring th e matter to the attention of the Committee. 
 
25.10 Any Member which considers that any measur e of another Member having the effects of a  
subsidy has not been notified in  accordance with the provisions of paragraph 1 of Article XVI of 
GATT 1994 and this Article may bring the matter to the attention of such other Member.   If the 
alleged subsidy is not thereafter notified promptly, such Member may itself bring the alleged subsidy 
in question to the no tice of the Committee. 
 25.11 Members shall report without delay to the Co mmittee all preliminary or final actions taken 
with respect to countervailing duties.  Such reports shall be available in the Secretariat for inspection 
by other Members.  Members shall also submit, on a semi-annual basis, reports on any countervailing 
duty actions taken within the preceding six months.  The semi-annual reports shall be submitted on an 
agreed standard form.  25.12 Each Member shall notify the Committee (a) which of its authorities are competent to initiate 
and conduct investigations re ferred to in Article 11 and (b) its domestic procedures governing the 
initiation and conduct of such investigations. 
 
 
Article 26  
 
Surveillance  
 
26.1 The Committee shall examine the 
new and full notifications s ubmitted under paragraph 1 of 
Article XVI of GATT 1994 and paragra ph 1 of Article 25 of this Agreem ent at special sessions held 
every third second  year.  Notifications submitted in the inte rvening years (updating notifications) shall 
be examined  at each regular meeting of the Committee.  
 
26.2 The Committee shall examine reports submitte d under paragraph 11 of Article 25 at each 
regular meeting of the Committee.      
PART VIII:  DEVELOPING COUNTRY MEMBERS 
 
 
Article 27  
 
Special and Differential Treatment of Developing Country Members  
 27.1 Members recognize that subsidies may play an important role in economic development 
programmes of developing country Members.  27.2 The prohibition of paragraph 1(a) of Article 3 shall not apply to:    
(a) developing country Members referred to in Annex VII. 
 
(b) other developing country Members for a pe riod of eight years from the date of entry 
into force of the WTO Agreement, subject  to compliance with the provisions in 
paragraph  4.  TN/RL/W/236 
 Page 67 
 
 
   
27.3 The prohibition of paragraph 1(b) of Article 3 shall not apply to developing country Members 
for a period of five years, and shall not apply to least developed country Members for a period of 
eight years, from the date of entry into force of the WTO Agreement.  
27.4 Any developing country Member referred to in paragraph 2(b) shall phase out its export 
subsidies within the eight-year period, preferably  in a progressive manner.  However, a developing 
country Member shall not increase the level of its export subsidies
61, and shall eliminate them within a 
period shorter than that provided for in this para graph when the use of such export subsidies is 
inconsistent  with its development needs.  If a developing country Member deems it necessary to 
apply such subsidies beyond the 8-year period, it shall not later than  one year before the expiry of this 
period enter into consultation with the Committee, wh ich will determine whether an extension of this 
period is justified, after examining all the releva nt economic, financial and development needs of the 
developing country Member in question.  If the Co mmittee determines that the extension is justified, 
the developing country Member concerned shall hold annual consultations with the Committee to 
determine the necessity of  maintaining the subsid ies.  If no such determination is made by the 
Committee, the developing country Member shall phase out the remaining export subsidies within 
two years from the end of the last authorized period.   27.5 A developing country Member which h as reached export competitiveness in any given 
product shall phase out its export subsidies for such pr oduct(s) over a period of two years.  However, 
for a developing country Member which is referred  to in Annex VII and wh ich has reached export  
competitiveness in one or more products, export subs idies on such products shall be gradually phased 
out over a period of eight years.    27.6 Export competitiveness in a product exists if a developing country Member's exports of that 
product have reached a share of at least 3.25 pe r cent in world trade of that product for two 
consecutive calendar years.  Export competitiveness shall exist either (a) on the basis of notification 
by the developing country Member having reached export competitiveness, or (b) on the basis of a 
computation undertaken by the Secretariat at the request of any Member.  For the purpose of this 
paragraph, a product is defined as a section headin g of the Harmonized System Nomenclature.  The 
Committee shall review the operation of this provision five years from the date of the entry into force 
of  the WTO Agreement. 
 
 [EXPORT COMPETITIVENESS:  Many delegatio ns support in principle clarifying the 
provisions on the determination of export co mpetitiveness in a product, but views differ 
considerably as to the best way to do th is, including changing the period and/or 
methodology for calculating share of world trade in a product, or clarifying the 
definition of a "product" for this purpose.  Views also differ widely as to whether reintroduction of export subsidies should be  allowed if export competitiveness is lost 
after having been reached, and if so  on what basis and for how long.] 
 
27.7 The provisions of Article 4 shall not apply to a developing country Member in the case of 
export  subsidies which are in conformity with the pr ovisions of paragraphs 2 th rough 5.  The relevant 
provisions in such a case shall be those of Article 7.  27.8 There shall be no presumption in terms of paragr aph 1 of Article 6 that a subsidy granted by a 
developing country Member results in serious prejudice,  as defined in this Agreement.  Such serious 
prejudice, where applicable under the terms of pa ragraph 9, shall be demonstrated by positive 
evidence, in accordance with th e provisions of paragraphs 3 through 8 of Article 6. 
                                                     
 
61 For a developing country Member not granting export su bsidies as of the date of entry into force of 
the WTO Agreement, this paragraph shall apply on the basi s of the level of export subsidies granted in 1986.  TN/RL/W/236 
Page 68  
 
  27.9 Regarding actionable subsidies granted or ma intained by a developing country Member other 
than those referred to in paragraph 1 of Article  6, action may not be authorized or taken under 
Article 7 unless nullification or impairment of tariff concessions or other obligations under GATT 1994 is found to exist as a result of such a su bsidy, in such a way as to displace or impede 
imports of a like product of another Member into th e market of the subsidizing developing country 
Member or unless injury to a domestic industry in the market of an importing Member occurs. 
 27.10 Any countervailing duty investigation of a product originating in a developing country Member shall be terminated as soon as th e authorities concerned determine that: 
 
(a) the overall level of subsidies granted upon the product in question does not exceed 
2 per cent of its value calculated on a per unit basis;  or 
 
(b) the volume of the subsidized imports re presents less than 4 per cent of the total 
imports of the like product in the importing Member, unless imports from developing 
country Members whose individual shares of total imports represent less than 
4 per cent collectively account for more than 9 per cent of the total imports of the like product in the importing Member. 
 27.11 For those developing country Members within  the scope of paragraph 2(b) which have 
eliminated  export subsidies prior to the expiry of the period of eight years from the date of entry into 
force of the WTO Agreement, and for those develo ping country Members referred to in Annex VII, 
the number in  paragraph 10(a) sha ll be 3 per cent rather than 2 per cent.  This provision shall apply 
from the date that the elimination of export subsidie s is notified to the Committee, and for so long as 
export subsidies are not granted by the notifying developing country Member.  This provision shall 
expire eight years from the date of en try into force of the WTO Agreement. 
 
27.12 The provisions of paragraphs 10 and 11 shall govern any determination of de minimis  under 
paragraph 3 of Article 15.  27.13 The provisions of Part III shall not apply to direct forgiveness of debts, subsidies to cover 
social costs, in whatever form, including relinquishm ent of government revenue and other transfer of 
liabilities when such subsidies are granted within a nd directly linked to a privatization programme of 
a developing country Member, provided that both such programme and the subsidies involved are 
granted for a limited period and notified to the Comm ittee and that the programme results in eventual 
privatization of the enterprise concerned.  
27.14 The Committee shall, upon request by an inter ested Member, undertake a review of a specific 
export subsidy practice of a developing country Me mber to examine whether the practice is in 
conformity with its development needs.  27.15 The Committee shall, upon request by an inte rested developing country Member, undertake a 
review of a specific countervailing measure to examine whether it is consistent with the provisions of 
paragraphs 10 and 11 as applicable to the developing country Member in question. 
    TN/RL/W/236 
 Page 69 
 
 
  PART IX:  TRANSITIONAL ARRANGEMENTS 
  
Article 28  
 
Existing Programmes  
 
28.1 Subsidy programmes which have been establishe d within the territory of any Member before 
the date on which such a Member signed the WTO Agreement and which are inconsistent with the 
provisions of this Agreement shall be: 
 
(a) notified to the Committee not later than 90 da ys after the date of entry into force of 
the WTO Agreement for such Member;  and 
 
(b) brought into conformity with the provisi ons of this Agreement within three years of 
the date of entry into force of the WTO Agreement for such Member and until then 
shall not be subject to Part II. 
 28.2 No Member shall extend the scope of any su ch programme, nor shall such a programme be 
renewed upon its expiry.  
 
Article 29  
 
Transformation into a Market Economy  
 29.1 Members in the process of transformation from a centrally-planned into a market, 
free-enterprise economy may apply programmes a nd measures necessary for such a transformation. 
 29.2 For such Members, subsidy programmes falling within the scope of Article 3, and notified 
according to paragraph 3, shall be  phased out or brought into conf ormity with Article 3 within a 
period of seven years from the date of entry into force of the WTO Agreemen t.  In such a case, 
Article 4 shall not apply.  In addition during the same period: 
 
(a) Subsidy programmes falling within the scope of paragraph 1(d) of Article 6 shall not 
be actionable under Article 7; 
 
(b) With respect to other actionable subsidies,  the provisions of paragraph 9 of Article 27 
shall apply. 
 29.3 Subsidy programmes falling within the scope of  Article 3 shall be notified to the Committee 
by the earliest practicable date after the date of entry into force of the WTO Agreement.  Further 
notifications of such subsidies may be made up to tw o years after the date of entry into force of the 
WTO Agreement. 
 29.4 In exceptional circumstances Members referred to in paragraph 1 may be given departures 
from their notified programmes and measures and their time-frame by the Committee if such departures are deemed necessary for the process of transformation. 
 
 TN/RL/W/236 
Page 70  
 
  PART X:  DISPUTE SETTLEMENT 
  
Article 30  
  The provisions of Articles XXII and XXIII of GATT 1994 as elaborated and applied by the 
Dispute Settlement Understanding shall apply to co nsultations and the settlement of disputes under 
this Agreement, except as otherwise specifically provided herein.   
PART XI:  FINAL PROVISIONS 
  
Article 31  
 
Provisional Application  
 
 The provisions of paragraph 1 of Article 6 and the provisions of Article 8 and Article 9 shall 
apply for a period of five years, beginning with the date of entry into force of the WTO Agreement.  
Not later than 180 days before the end of this period, the Committee shall review the operation of 
those provisions, with a view to determining whethe r to extend their application, either as presently 
drafted or in a modified form, for a further period. 
  
Article 32 
 
Other Final Provisions  
 
32.1 No specific action against a subsidy of anot her Member can be taken except in accordance 
with the provisions of GATT 1994, as interpreted by this Agreement.
62 
 32.2 Reservations may not be entered in respect of any of the provisions of this Agreement without 
the consent of the other Members. 
 32.3 Subject to paragraph 4, the provisions of th is Agreement shall apply to investigations, and 
reviews of existing measures, initiated pursuant to a pplications which have been made on or after the 
date of entry into force for a Member of the WTO Agreement. 
 
32.4 For the purposes of paragraph 3 of Article  21, existing countervailing measures shall be 
deemed to be imposed on a date not later than the date of entry into force for a Member of the WTO 
Agreement, except in cases in which the domestic legislation of a Member in force at that date already included a clause of the type provided for in that paragraph.  
32.5 Each Member shall take all necessary steps, of a general or particular character, to ensure, not 
later than the date of entry into force of the WTO Agreement for it, the conformity of its laws, 
regulations and administrative procedures with the pr ovisions of this Agreement as they may apply to 
the Member in question.  
32.6 Each Member shall inform the Committee of an y changes in its laws a nd regulations relevant 
to this Agreement and in the administ ration of such laws and regulations. 
                                                     
 
62 This paragraph is not intended to preclude action under other relevant provisions of GATT 1994, 
where appropriate.  TN/RL/W/236 
 Page 71 
 
 
  32.7 The Committee shall review annually the impl ementation and operation of this Agreement, 
taking into account the objectives thereof.  Th e Committee shall inform annually the Council for 
Trade in Goods of developments during the period covered by such reviews.  32.8 The Annexes to this Agreement cons titute an integral part thereof.  TN/RL/W/236 
Page 72  
 
  ANNEX I 
 
ILLUSTRATIVE LIST OF EXPORT SUBSIDIES 
  
(a) The provision by governments of direct subsidies to a firm or an industry contingent upon 
export performance. 
 (b) Currency retention schemes or any simila r practices which involve a bonus on exports. 
 
(c) Internal transport and freight charges on export shipments, provided or mandated by 
governments, on terms more favourable than for domestic shipments. 
 (d) The provision by governments or their agencies either directly or indirectly through 
government-mandated schemes, of imported or domestic products or services for use in the 
production of exported go ods, on terms or conditions more favourable than for provision of 
like or directly  competitive products or ser vices for use in the production of goods for 
domestic consumption, if (in the case of pr oducts) such terms or conditions are more 
favourable than those commercially available
63 on world markets63 to their exporters. 
 (e) The full or partial exemption remission, or de ferral specifically related to exports, of direct 
taxes
64 or social welfare charges paid or payable by industrial or commercial enterprises.65 
 (f) The allowance of special deductions directly related to exports or export performance, over 
and above those granted in respect to productio n for domestic consumption, in the calculation 
of the base on which direct taxes are charged. 
 
                                                     
 
63 The term "commercially available on world markets " means that the choice between domestic and 
imported products is unrestricted and depends only on commercial considerations. 
64 For the purpose of this Agreement: 
 The term "direct taxes" shall mean taxes on wage s, profits, interests, re nts, royalties, and all 
other forms of income, and taxes on the ownership of real property; 
 The term "import charges" shall mean tariffs,  duties, and other fiscal charges not elsewhere 
enumerated in this note that are levied on imports; 
 The term "indirect taxes" shall mean sales, excise, turnover, value added, franchise, stamp, 
transfer, inventory and equipment taxes, border taxes and all taxes other than direct taxes and import charges; 
 "Prior-stage" indirect taxes are those levied on goods or services used directly or indirectly in 
making the product; 
 "Cumulative" indirect taxes are multi-staged taxes levied where there is no mechanism for 
subsequent crediting of the tax if the goods or services subject to tax at one stage of production are used in a 
succeeding stage of production; 
 "Remission" of taxes includes the refund or rebate of taxes; 
 "Remission or drawback" includes the full or partial exemption or deferral of import charges. 
65 The Members recognize that deferral need not amount to an export subsidy where, for example, 
appropriate interest charges are co llected. The Members reaffirm the pr inciple that prices for goods in 
transactions between exporting enterprises and foreign buyers under their or under the same control should for tax purposes be the prices which would be charged between independent enterprises acting at arm's length. Any 
Member may draw the attention of another Member to administrative or other practices which may contravene 
this principle and which result in a significant saving  of direct taxes in expo rt transactions. In such 
circumstances the Members shall normally attempt to resolve their differences using the facilities of existing 
bilateral tax treaties or other specific international mechanisms, without prejudice to the rights and obligations 
of Members under GATT 1994, including the right of  consultation created in  the preceding sentence. 
 Paragraph (e) is not intended to limit a Member from taking measures to avoid the double 
taxation of foreign-source income earned by its en terprises or the enterprises of another Member.  TN/RL/W/236 
 Page 73 
 
 
  (g) The exemption or remission, in respect of the production and distribution of exported 
products, of indirect taxes5864 in excess of those levied in respect of the production and 
distribution of like products when sold for domestic consumption. 
 (h) The exemption, remission or deferral of  prior-stage cumulative indirect taxes
5864 on goods or 
services used in the production of exported produc ts in excess of the exemption, remission or 
deferral of like prior-stage cumulative indirect taxes on goods or services used in the  production of like products when sold for domestic  consumption;  provided, however, that 
prior-stage cumulative indirect taxes may be exempted, remitted or deferred on exported 
products even when not exempted, remitted or deferred on like products when sold for 
domestic consumption, if the prior-stage cumula tive indirect taxes are levied on inputs that 
are consumed in the production of the exported product  (making normal allowance for waste).
66   This item shall be interpreted in acco rdance with the guidelines on consumption of 
inputs in the production process contained in Annex II. 
 
(i) The remission or drawback of import charges5864 in excess of those levied on imported inputs 
that are consumed in the production of the exported product (making normal allowance for 
waste);  provided, however, that in particular cases a firm may use a quantity of home market  inputs equal to, and having the same quality and characteristics as, the imported inputs as a 
substitute for them in order to benefit from th is provision if the import and the corresponding 
export operations both occur within a reasonable time  period, not to exceed two years.   This  
item shall be interpreted in accordance with the guidelines on consumption of inputs in the 
production process contained in Annex II and the guidelines in the determination of 
substitution drawback systems as export subsidies contained in Annex III. 
 (j) The provision by governments (or special in stitutions controlled by and/or acting under the 
authority of governments) of export credit guarantee or  insurance programmes, of insurance 
or guarantee programmes against increases in th e cost of exported products or of exchange 
risk programmes, at premium rates which are inadequate to cover the long-term operating 
costs and losses of the programmes. 
 (k) The grant by governments (or special ins titutions controlled by and/or acting under the 
authority of governments) of export credits at ra tes below those which they actually have to 
pay for the funds so employed (or would have to pay if they borrowed on international capital 
markets in order to obtain funds of the same maturity and other credit terms and denominated 
in the same currency as the export credit), or the payment by them of all or part of the costs incurred by exporters or financial institutions in obtaining credits, in so far as they are used to 
secure a material advantage in the field of export credit terms. 
 
 [EXPORT CREDITS – MARKET BENCHMARKS:  Delegations disagree regarding 
whether the texts of item (j) and the first pa ragraph of item (k) should be amended to 
replace the cost-to-government benchmark wi th one based on benefit-to-recipient.  
Those favoring such changes consider that the current provisions work to the 
disadvantage of developing Members and are inconsistent with the Agreement's general 
definition of "subsidy".  Other delegations, however, consider that such changes would increase costs for developing country borro wers, and would reduce predictability for 
export credit agencies.] 
   
                                                     
 
66 Paragraph (h) does not apply to value-added tax systems and border-tax adjustment in lieu thereof;  
the problem of the excessive remission of value-added taxes is exclusively covered by paragraph (g). 
 TN/RL/W/236 
Page 74  
 
  Provided, however, that if a Member is a party to an international undertaking on official 
export credits to which at least twelve original  Members to this Agreement are parties as of 
1 January 1979 (or a successor undertaking whic h has been adopted by those original 
Members), or if in practice a Member applies the interest rates provisions of the relevant undertaking, an export credit practice which is in  conformity with those provisions shall not 
be considered an export subsidy prohibited by this Agreement. 
 
[EXPORT CREDITS – SUCCESSOR UNDERTAKINGS:  Views differ widely as to 
whether the second paragraph of item (k) should be amended such that any changes to the OECD Export Credit Arrangement would not automatically take  effect for purposes 
of the SCM Agreement.  At one end of the spectrum, some delegations consider that only 
amendments not objected to by any Member within a certain period should have legal 
effect under the second paragraph of item (k), while at the other end of the spectrum some delegations consider that Members should  not have any basis on which effectively 
to veto decisions taken by Part icipants to the Arrangement.] 
 
(l) Any other charge on the public account cons tituting an export subsidy in the sense of 
Article XVI of GATT 1994. 
  TN/RL/W/236 
 Page 75 
 
 
  ANNEX II 
 
GUIDELINES ON CONSUMPTION OF INPUTS IN THE PRODUCTION PROCESS67 
  
I 
 1. Indirect tax rebate schemes can allow for exemption, remission or deferral of prior-stage 
cumulative indirect taxes levied on inputs that ar e consumed in the production of the exported product 
(making normal allowance for waste).   Similarly,  drawback schemes can allow for the remission or  
drawback of import charges levied on inputs that are consumed in the production of the exported 
product (making normal allowance for waste).  2. The Illustrative List of Export Subsidies in A nnex I of this Agreement makes reference to the 
term "inputs that are consumed in the production of the exported product" in pa ragraphs (h) and (i).  
Pursuant to paragraph (h), indirect tax rebate schem es can constitute an export subsidy to the extent  
that they result in exemption, remission or deferra l of prior-stage cumulative indirect taxes in excess 
of the amount of such taxes actually levied on i nputs that are consumed in the production of the 
exported product.   Pursuant to paragraph (i), drawback schemes can  constitute an export subsidy to 
the extent  that they result in a remission or dr awback of import charges in excess of those actually 
levied on inputs that are consumed in the producti on of the exported product.   Both paragraphs 
stipulate that normal allowance for waste must be made in findings regarding consumption of inputs 
in the production of the exported product.   Pa ragraph (i) also provides for substitution, where 
appropriate.   
II 
  In examining whether inputs are consumed in  the production of the exported product, as part 
of a countervailing duty investigation pursuant to this Agreement, investigating authorities should 
proceed on the following basis:  
1. Where it is alleged that an indirect tax re bate scheme, or a drawback scheme, conveys a 
subsidy by reason of over-rebate or excess drawback  of indirect taxes or import charges on inputs 
consumed in the production of the exported produ ct, the investigating authorities should first 
determine whether the government of the exporting Member has in place and applies a system or 
procedure to confirm which inputs are consumed in the production of the exported product and in 
what amounts.   Where such a system or procedure is determined to be applied, the investigating 
authorities should then examine the system or proced ure to see whether it is reasonable, effective for 
the purpose intended, and based on generally accepted co mmercial practices in the country of export.   
The investigating authorities may deem it necessary to carry out, in accordance with paragraph 6 of 
Article 12, certain practical tests in  order to verify information or to  satisfy themselves that the system 
or procedure is being effectively applied. 
 
2. Where there is no such system or procedure, where it is not reasonable, or where it is instituted and considered reasonable but is found not to  be applied or not to be applied effectively, a 
further examination by the exporting Member base d on the actual inputs involved would need to be 
carried out in the context of determining whether an excess payment occurred.   If the investigating 
                                                     
 
67 Inputs consumed in the production process are inputs physically incorporated, energy, fuels and oil 
used in the production process and catalysts which are cons umed in the course of thei r use to obtain the exported 
product. TN/RL/W/236 
Page 76  
 
  authorities deemed it necessary, a further examina tion would be carried out in accordance with 
paragraph 1.  3. Investigating authorities should treat inputs as physically incorporated if such inputs are used 
in the production process and are physically present in the product exported.   The Members note that 
an input need not be present in the final product in  the same form in which it entered the production 
process.  4. In determining the amount of a particular i nput that is consumed in the production of the 
exported product, a "normal allowance for waste"  should be taken into account, and such waste 
should be treated as consumed in the production of th e exported product.   The term "waste" refers to 
that portion of a given input which does not serve an independent function in the production process, 
is not consumed in the production of the exported product (for reasons such as inefficiencies) and is 
not recovered, used or sold by the same manufacturer.  
5. The investigating authority's determination of whether the claimed allowance for waste is 
"normal" should take into account the production pr ocess, the average experience of the industry in 
the country of export, and other technical factors, as appropriate.   The investigating authority should 
bear in mind that an important question is whet her the authorities in the exporting Member have 
reasonably calculated the amount of waste, when such  an amount is intended to be included in the tax 
or duty rebate or remission. 
  TN/RL/W/236 
 Page 77 
 
 
  ANNEX III 
 
GUIDELINES IN THE DETERMINATION OF SUBSTITUTION 
DRAWBACK SYSTEMS AS EXPORT SUBSIDIES 
 
 
I 
  Drawback systems can allow for the refund or  drawback of import charges on inputs which 
are consumed in the production process of another product and where the expor t of this latter product 
contains domestic inputs having the same quality and characteristics as those substituted for the 
imported inputs.  Pursuant to para graph (i) of the Illustrative List of Export Subsidies in Annex I, 
substitution drawback systems can constitute an export subsidy to the extent that they result in an 
excess drawback of the import charges levied initially  on the imported inputs for which drawback is 
being claimed. 
 
 
II 
  In examining any substitution drawback system  as part of a countervailing duty investigation 
pursuant to this Agreement, investigating au thorities should proceed on the following basis: 
 
1. Paragraph (i) of the Illustrative List stipul ates that home market input s may be substituted for 
imported inputs in the production of a product for e xport provided such inputs are equal in quantity to, 
and have the same quality and characteristics as, the imported inputs being substitu ted.   The existence 
of a verification system or procedure is important  because it enables the government of the exporting 
Member to ensure and demonstrate that the quantit y of inputs for which draw back is claimed does not 
exceed the quantity of similar products exported, in wh atever form, and that there is not drawback of 
import charges in excess of those originally levied on the imported inputs in question. 
 2. Where it is alleged that a substitution drawback  system conveys a subsidy, the investigating 
authorities should first proceed to determine whethe r the government of the exporting Member has in 
place and applies a verification system or procedure.   Where such a system or procedure is 
determined to be applied, the investigating author ities should then examine the verification procedures 
to see whether they are reasonable, effective for the purpose intended, and based on generally 
accepted commercial practices in the country of expor t.   To the extent that the procedures are 
determined to meet this test and are effectively a pplied, no subsidy should be presumed to exist.   It 
may be deemed necessary by the investigating aut horities to carry out, in accordance with paragraph 6 
of Article 12, certain practical tests in order to ve rify information or to satisfy themselves that the 
verification procedures are being effectively applied.  3. Where there are no verification procedures, where they are not reasonable, or where such procedures are instituted and considered reasonable but are found not to be actually applied or not 
applied effectively, there may be a subsidy.   In such cases a further examination by the exporting 
Member based on the actual transactions involved woul d need to be carried out to determine whether 
an excess payment occurred.   If the investiga ting authorities deemed it necessary, a further 
examination would be carried out in accordance with paragraph 2.  
4. The existence of a substitution drawback provision under which exporters are allowed to 
select particular import shipments on which drawback is claimed should not of itself be considered to 
convey a subsidy.  TN/RL/W/236 
Page 78  
 
  5. An excess drawback of import ch arges in the sense of paragraph (i) would be  deemed to exist 
where governments paid interest on any monies ref unded under their drawback schemes, to the extent 
of the interest actually paid or payable.  TN/RL/W/236 
 Page 79 
 
 
  ANNEX IV 
 
CALCULATION OF THE TOTAL AD VALOREM SUBSIDIZATION 
(PARAGRAPH 1(A) OF ARTICLE 6)68 
 
 
1. Any calculation of the amount of a subsidy for the purpose of paragraph 1(a) of Article 6 shall 
be done in terms of the cost to the granting government.  2. Except as provided in paragraphs 3 through 5,  in determining whether the overall rate of 
subsidization exceeds 5 per cent of the value of th e product, the value of the product shall be 
calculated as the total value of the recipient firm's
69 sales in the most recent 12-month period, for 
which sales data is available, preceding th e period in which the subsidy is granted.70 
 3. Where the subsidy is tied to the production or sale of a given product, the value of the product 
shall be calculated as the total value of the recipien t firm's sales of that product in the most recent 12-
month period, for which sales data is available, pr eceding the period in which the subsidy is granted. 
 4. Where the recipient firm is in a start-up situa tion, serious prejudice shall be deemed to exist if 
the overall rate of subsidization exceeds 15 per cent of  the total funds invested.  For purposes of this  
paragraph, a start-up period will not ex tend beyond the first year of production.
71 
 
5. Where the recipient firm is located in an inflationary economy country, the value of the product shall be calculated as the recipient firm's to tal sales (or sales of the relevant product, if the 
subsidy is tied) in the preceding calendar year inde xed by the rate of inflation experienced in the 
12 months preceding the month in whic h the subsidy is to be given. 
 
6. In determining the overall ra te of subsidization in a give n year, subsidies given under 
different programmes and by different authorities in the territory of a Member shall be aggregated. 
 7. Subsidies granted prior to the date of entry in to force of the WTO Agreement, the benefits of 
which are allocated to future production, shall be included in the overall rate of subsidization. 
 
8. Subsidies which are non-actionable under releva nt provisions of this Agreement shall not be 
included in the calculation of the amount of a subsidy for the purpose of paragraph 1(a) of Article 6. 
  
                                                     
 
68 An understanding among Members should be deve loped, as necessary, on matters which are not 
specified in this Annex or which need  further clarification for the purposes of paragraph 1(a) of Article 6. 
69 The recipient firm is a firm in the territory of the subsidizing Member. 
70 In the case of tax-related subsidies the value of the product shall be calculated as the total value of 
the recipient firm's sales in the fiscal year  in which the tax-related measure was earned. 
71 Start-up situations include instances where financial commitments for product development or 
construction of facilities to manufacture products benef iting from the subsidy have been made, even though 
production has not begun. TN/RL/W/236 
Page 80  
 
  ANNEX V 
 
PROCEDURES FOR DEVELOPING INFORMAT ION CONCERNING SERIOUS PREJUDICE 
  
1. Every Member shall cooperate in the developm ent of evidence to be examined by a panel in 
procedures under paragraphs 4 through 6 of Artic le 7.  The parties to the dispute and any 
third-country Member concerned shall notify to the DSB, as soon as the provisions of paragraph 4 of 
Article 7 have  been invoked, the organization respons ible for administration of this provision within 
its territory and the procedures to be used to comply with requests for information. 
 
2. In cases where matters are referred to the DSB under paragraph 4 of Article 7, the DSB shall, 
upon request, initiate the procedure to obtain such information from the government of the subsidizing 
Member as necessary to establish the existence and amount of subsidization, the value of total sales of 
the subsidized firms, as well as information necessar y to analyze the adverse effects caused by the 
subsidized product.
72  This process may include, where appropriate, presentation of questions to the 
government of the subsidizing Member and of the complaining Member to collect information, as 
well as to clarify and obtain elaboration of informa tion available to the parties to a dispute through the 
notification procedures set forth in Part VII.73 
 3. In the case of effects in third-country markets,  a party to a dispute may collect information, 
including through the use of questions to the gove rnment of the third-country Member, necessary to 
analyse adverse effects, which is not otherwise reasonably available from the complaining Member  
or the subsidizing Member.   This requirement shoul d be administered in such a way as not to impose 
an unreasonable burden on the third-country Member.   In particular, such a Member is not expected 
to make a market or price analysis specially for that  purpose.   The information to be supplied is that 
which is already available or can be readily obtained  by this Member (e.g. most recent statistics which 
have already been gathered by relevant statisti cal services but which have not yet been published, 
customs data concerning imports and declared values of  the products concerned, etc.).   However, if a 
party to a dispute undertakes a detailed market analys is at its own expense, the task of the person or 
firm  conducting such an analysis shall be facilita ted by the authorities of the third-country Member 
and such a person or firm shall be given access to all information which is not normally maintained 
confidential by the government. 
 4. The DSB shall designate a representativ e to serve the function of facilitating the 
information-gathering process.  The sole purpose of the representative shall be to ensure the timely 
development of the information necessary to facilita te expeditious subsequent multilateral review of 
the dispute.  In particular, the representative ma y suggest ways to most efficiently solicit necessary 
information as well as encourage the cooperation of the parties.  5. The information-gathering process outlined in  paragraphs 2 through 4 shall be completed 
within 60 days of the date on which the matter has been referred to the DSB under paragraph 4 of 
Article 7.  The information obtained during this proc ess shall be submitted to the panel established by 
the DSB in accordance with the provisions of Part X.  This information should include,  inter alia , 
data concerning the amount of the subsidy in questio n (and, where appropriate, the value of total sales 
of the subsidized firms), prices of the subsidized product, prices of the non-subsidized product, prices 
of other suppliers to the market, changes in the su pply of the subsidized product to the market in 
                                                     
 
72 In cases where the existence of serious prejudice has to be demonstrated. 
73 The information-gathering process by the DSB shall take into account the need to protect 
information which is by nature confidential or which is provided on a confidential basis by any Member 
involved in this process.  TN/RL/W/236 
 Page 81 
 
 
  question and changes in market shares.  It should also include rebuttal evid ence, as well as such 
supplemental information as the panel deems rele vant in the course of reaching its conclusions. 
 6. If the subsidizing and/or third-country Member  fail to cooperate in the information-gathering 
process, the complaining Member will present its case of serious prejudice, based on evidence 
available to it, together with facts and circumstan ces of the non-cooperation of the subsidizing and/or 
third-country Member.   Where information is unava ilable due to non-cooperation by the subsidizing 
and/or third-country Member, the panel may complete the record as necessary relying on best information otherwise available.  
7. In making its determination,  the panel should draw adverse inferences from instances of non- 
cooperation by any party involved in the information-gathering process. 
 8. In making a determination to use either best information available or adverse inferences, the 
panel shall consider the advice of the DSB repr esentative nominated under paragraph 4 as to the 
reasonableness of any requests for information and th e efforts made by parties to comply with these 
requests in a cooperative and timely manner.  9. Nothing in the information-gathering process sh all limit the ability of the panel to seek such  
additional information it deems essential to a prope r resolution to the dispute, and which was not 
adequately sought or developed during that process.    However, ordinarily the panel should not 
request additional information to complete th e record where the information would support a 
particular party's position and the absence of that  information in the record is the result of 
unreasonable non-cooperation by that party in the information-gathering process.  TN/RL/W/236 
Page 82  
 
  ANNEX VI 
 
PROCEDURES FOR ON-THE-SPOT INVESTIGATIONS PURSUANT TO 
PARAGRAPH 6 OF ARTICLE 12 
 
 
1. Upon initiation of an investigation, the au thorities of the exporting Member and the firms 
known to be concerned should be informed of the in tention to carry out on-the-spot investigations. 
 2. If in exceptional circumstances it is intended to include non-governmental experts in the 
investigating team, the firms and the authorities of  the exporting Member should be so informed.  
Such non-governmental experts should be subject to effective sanctions for breach of confidentiality 
requirements.  3. It should be standard practice to obtain e xplicit agreement of the firms concerned in the 
exporting Member before the visit is finally scheduled. 
 4. As soon as the agreement of the firms conc erned has been obtained, the investigating 
authorities should notify the authorities of the exporting Member of the names and addresses of the firms to be visited and the dates agreed.  
5. Sufficient advance notice should be given to th e firms in question before the visit is made. 
 6. Visits to explain the questionnaire should only be  made at the request of an exporting firm.  In 
case of such a request the investigating authorities ma y place themselves at the disposal of the firm;  
such a visit may only be made if (a) the authorities of the importing Member notify the 
representatives of the government of the Member in question and (b) the latter do not object to the 
visit.  7. As the main purpose of the on-the-spot investig ation is to verify information provided or to 
obtain further details, it should be carried out after the response to the questionnaire has been received 
unless the firm agrees to the contrary and the govern ment of the exporting Member is informed by the 
investigating authorities of the anticipated visit and does not object to it;  furthe r, it should be standard 
practice prior to the visit to advise the firms concerne d of the general nature of the information to be 
verified and of any further information which need s to be provided, though this should not preclude 
requests to be made on the spot for further details to  be provided in the light of information obtained. 
 
8. Enquiries or questions put by the authoriti es or firms of the exporting Members and essential 
to a successful on-the-spot investigation should, when ever possible, be answer ed before the visit is 
made.   TN/RL/W/236 
 Page 83 
 
 
  ANNEX VII 
 
DEVELOPING COUNTRY MEMBERS REFERRED TO 
IN PARAGRAPH 2(A) OF ARTICLE 27 
 
 
 The developing country Members not subject to the provisions of paragraph 1(a) of Article 3 
under the terms of  paragraph 2(a) of Article 27 are:  
(a) Least-developed countries designated as such by the United Nations which are 
Members of the WTO. 
  (b) Each of the following developing countr ies which are Members of the WTO shall be 
subject to the provisions which are appli cable to other developing country Members 
according to paragraph 2(b) of Article  27 when GNP per capita has reached 
$1,000 per annum
74:  Bolivia, Cameroon, Congo, Côte d'Ivoire, Dominican Republic, 
Egypt, Ghana, Guatemala, Guyana, Honduras, India, Indonesia, Kenya, Morocco, 
Nicaragua, Nigeria, Pakistan, Philippine s, Senegal, Sri Lanka and Zimbabwe. 
 
                                                      
74 The inclusion In constant 1990 dollars for three consecutive years as calculated by the Secretariat on 
the basis  of developing coun try Members in the list in paragraph (b) is based on the most recent data from the 
World Bank on GNP per capita, pursuant to paragraph 10.1 of the Ministerial Decision on Implementation-
Related Issues and Concerns (WT/MIN(01)/17).  A Member shall not leave Annex VII(b) so long as its GNP 
per capita in current dollars has no t reached US$1,000 based upon the mo st recent data from the World Bank, 
and shall be reincluded in the list in Annex VII(b)  when its GNP per capita falls back below US$1,000 .  TN/RL/W/236 
Page 84  
 
  ANNEX VIII 
  
FISHERIES SUBSIDIES 
 
 
Note
:  The text on fisheries subsidies will be revi sed following discussion of the issues identified in 
the annexed fisheries subsidies roadmap. 
  
 
_______________ 
 
 TN/RL/W/236 
Page 85 
 
 
  FISHERIES SUBSIDIES – ROADMAP FOR DISCUSSIONS 
 THE NEGOTIATING MANDATE
 
 1. The Ministerial mandate from Hong Kong dir ects this Negotiating Group to "strengthen 
disciplines  on subsidies in the fisheries sect or, including through the prohibition  of certain forms of 
fisheries subsidies that contribut e to overcapacity and over-fishing " and, as an integral part of the 
negotiations, to establish "appropriate and e ffective special and differential treatment  for developing 
and least-developed Members".  
 
GENERAL CONSIDERATIONS  
 2. The issue of fisheries subsidies continues to be  the subject of a vigorous debate.  My sense is 
that all participants recognize the global crisis of  overcapacity and overfishing, with its consequent 
negative economic and environmental effects, and are committed to ensuring that the disciplines 
ultimately developed, whatever their form, must be effective in fulfilling the negotiating mandate from 
Ministers.  That said, since I tabled my first dr aft text in document TN/RL/W/213, participants' views 
have continued to differ widely.   
3. In my view, the existing differences are mainly  due to varied perceptions among participants 
as to the exact scope and meaning of the mandate.  Ministers in Hong Kong identified as the central 
focus of these negotiations the strengthening of di sciplines, in particular through a prohibition, on 
subsidies that contribute to overcapacity or overfish ing.  Thus it is clear that crafting such new 
disciplines is at the core of the negotiations.  Duri ng the negotiations, much of the debate in practice 
has been about other considerations that should modul ate the impact of any new disciplines.  In this 
regard, while the Group had many useful discussions  on the basis of my first draft text, of both 
possible disciplines and other considerations, that text did not move us closer to a common 
understanding as to subsidies that should be prohib ited and exempted from disciplines.  I thus fully 
recognize that I will need to revise that text in view of the continued differences of view.  The discussions to date have not, however, generated the necessary elements that would provide me with 
the basis for a revision that could lead to greater convergence.   
4. As we resume our work, therefore, I believe th at in the first instance in our discussions we 
should take a step back and reflect on the fundamental issues raised by the mandate.  In particular, in 
my view the Group should work to identify those subsidies that contribute to overcapacity or 
overfishing, with a view to determining which of  these should and should not be prohibited, while 
considering at the same time how to effectivel y address the needs and particularities of developing 
Members.   
5. In this context, wherever certain participants may consider that certain subsidies should not be 
prohibited, the Group would need to consider the reasons advanced:  for example, because such 
subsidies contribute only minimally to overcapacity  or overfishing; because the effects of such 
subsidies could be adequately controlled by fisher ies management or other means; because the small 
scale of certain subsidized operations would lim it or eliminate the potential contribution to 
overcapacity or overfishing of the subsidies; or beca use of their importance to development priorities.  
In respect of any such proposed exemptions, the Group would need to consider how the integrity of 
the mandate would be ensured, such that any su ch subsidies would not in practice contribute to 
overcapacity or overfishing.   
6. A basic issue that would need to be taken up is how the existence of overcapacity or 
overfishing can be established as objectively and precisely as possible.  Given that many questions of judgement would be involved in su ch determinations, one important question is the appropriateness of TN/RL/W/236 
Page 86  
 
  leaving it to each Member to judge its own situatio n, or if not the Member, who else could or should 
make such judgements.   
7. A further fundamental issue is how to ensure  adequate implementation, monitoring and 
surveillance.  As is the case for all WTO rules, fisheries subsidies disciplines would need to include 
provisions for such mechanisms.  Given the potent ial, as recognized in the mandate, for fisheries 
subsidies to contribute to overcapacity and overfish ing, coupled with the mobile and undomesticated 
nature of the resources, a principal question would be how adequate surveillance of the effectiveness 
of the operation of the rules could be ensured,  and whether the rules therefore should include 
enhanced surveillance mechanisms.    
8. I believe that the best approach for the Ne gotiating Group to take in seeking a common 
understanding in respect of these basic conceptual issues is to discuss these issues on the basis of a 
number of more detailed questions.  In  this regard, to facilitate this pr ocess, in the next sections of this 
paper I raise a series of such questions, all of whic h are aimed at clarifying participants' positions on 
different aspects of the mandate.   
9. I call upon all participants to re-e ngage in, and deepen, the debate  of the basic concepts that 
must be addressed, and especially to come to grips with how the various elements of a new discipline 
will work together in a coherent way to effectivel y fulfil the mandate that we have received from the 
Ministers.   
 
PROHIBITION
 
10. On the basis of this mandate, a core task  for the Negotiating Group is to seek a common 
understanding as to the subsidies that "contribute to  overcapacity and overfishing".  As participants 
are aware, my first draft text took a "bottom-up" approach, listing particular specific subsidies that 
would be prohibited.1  This list was drawn up based on s ubmissions by and discussions among 
participants identifying those subsidies that the submitters considered contribute to overcapacity 
and/or overfishing.  It is clear from the discussions that participants' views still differ widely regarding 
which subsidies should be prohibited.   
11. I therefore would seek first a detailed discussi on by the Group on which particular subsidies 
they believe should be prohibited (inc luding but not limited to those referred to in my first draft text) 
in the light of the Ministerial mandate, addressing inter alia  the following points:   
(a) For each subsidy that in your view should  be prohibited, how does it contribute to 
overcapacity or overfishing?   
(b) If you believe that a given subsidy should no t be prohibited, why?  If this is because 
you do not consider that it contributes to overcapacity or overfishing, what are the specific reasons for this view?     
(c) Where you consider that a given subsidy that has been proposed for prohibition 
should not be included in a list of prohibite d subsidies, because in your view it does 
not contribute to overcapacity or overfishing, how would you address the question of 
interchangeability of subsidies?  Specifica lly, how could non-prohibited subsidies that 
                                                     
 
1 On a fundamental point related to this list of measures, I wish to be clear that my first draft text would 
apply only to subsidies that are specific on any of the bases provided for in Article 2 of the Agreement (i.e., the list does not include subsidies that would not meet the definition of specificity in Article 2, but is not limited to 
subsidies that are specific on a sectoral basis to fisheries).    TN/RL/W/236 
 Page 87 
 
 
  reduce costs to the fisheries sector be prev ented from contributing to overcapacity or 
overfishing?   
(d) What should the scope of any prohibitions be, i.e., how far upstream or downstream 
should they reach, and should the focus be marine wild capture fisheries?   
(e) Should any or all proposed prohibitions be conditional on anything?  If so, on what?   
(f) What role should there be for a provision such as the prohibition of non-listed 
subsidies in respect of "unequivo cally overfished" fisheries?   
(g) If such a provision is viewed as unnecessary,  
(i) How otherwise could it be ensured that a bottom-up list of prohibited 
subsidies would be effective in fulfilling the mandate?  
(ii) What would be the justification for permitting subsidies in respect of 
overexploited fisheries? 
 GENERAL EXCEPTIONS
 
 
12. In my first draft text, the list of subsidies that  would be prohibited is modulated by general 
exceptions, mainly for subsidies identified by pa rticipants as helping to reduce overcapacity and 
overfishing, and to improve environmental conditions in marine wild capture fisheries.  In the light of 
the mandate from Ministers, i.e., to prevent them from undermining the effectiveness of the 
prohibition, these proposed exceptions as envisaged would be conditioned on  the establishment and 
operation of fisheries management systems and measures.   
13. Participants are asked to consider the following: 
(a) What measures are appropriate for inclusion in a list of general exceptions? 
(i) For each such measure, is the rationale that it would be unlikely to contribute 
to, or would counteract, overcapacity or overfishing?  If so, why? 
(ii) For any measure proposed for a general exception in spite of possibly 
contributing to overcapacity or overfishing, what would be the rationale for 
excepting it from prohibition?   
(b) Where you consider that a given measure that has been proposed for a general 
exception should instead be prohibited, what  are the reasons?  Do you consider that 
the measure would contribute to overcapacity or overfishing, and if so, how specifically?   
(c) Should general exceptions be conditiona l in principle on having a fisheries 
management system in place (leaving for the section below the details concerning fisheries management):  
(i) Should each general exception be conditional on fisheries management?   
- Are there additional or alternative conditions that should apply? TN/RL/W/236 
Page 88  
 
  - Are there general exceptions that in your view should be unconditional?  
Which ones? 
- How could it be ensured that any unconditional exceptions would not 
contribute to overcapacity or overfishing?   
(d) If most WTO Members are committed to and already have implemented or are in the 
process of implementing fisheries management systems, what would be the 
difficulties, in practical terms, of agreeing to having fisheries management in place as a condition for making use of general exceptions?   
 SPECIAL AND DIFFERENTIAL TREATMENT
 
14. In the light of the mandate from Ministers, my fi rst draft text contains special and differential 
treatment provisions whereby developing Member s could provide certain capacity- and effort-
enhancing subsidies that otherwise would be s ubject to prohibition.  During the negotiations, 
developing Members have c onsistently acknowledged that subsidies by any country can contribute to 
the global problems of overcapacity and overfishing, and thus have indicated that they are not seeking 
a "blank check" allowing unlimited and unconditiona l subsidization.  The difficulty in the 
negotiations on S&D provisions thus  far is how to find a balance between flexibility for developing 
Members to provide subsidies to develop their fisher ies sector on the one hand, and ensuring that such 
subsidies do not contribute to overcapacity and overfishing, on the other hand.   
15. Participants are asked to reflect in detail on the following questions: 
(a) Do participants support an essentially full carve-out from the disciplines for LDCs?  
(b) For developing Members other than LDCs, is  it appropriate and c onsistent with the 
mandate that S&D exceptions be broadest and subject to the fewest conditions for 
subsidies to the smallest-scale, closest to shore, and least commercial fishing 
operations, with exceptions becoming progressively narrower and subject to more conditions as the subsidized operations beco me larger-scale, further from shore, and 
more commercial?    
(i) If so, how could such different types,  scales and/or geographic areas of 
operations be defined a nd differentiated?   
(ii) How would the resulting categories relate to the mandate to discipline 
subsidies that contribute to overcapacity or overfishing?   
(iii) What types of conditionalities would apply, to which categories?  
(c) Are there other bases on which fisheries opera tions of developing Members could be 
categorized for the purpose of S&D excep tions, which would provide the necessary 
flexibility to developing Members without contributing to overcapacity or overfishing? 
(d) If no other dividing lines among types, scales and/or geographic areas of operations 
can be identified, would all non-LDC de veloping Members receive the same S&D 
treatment in respect of their fisheries s ubsidies to all types, scales and geographic 
areas of fisheries operations?  TN/RL/W/236 
 Page 89 
 
 
  (i) In such a situation, what should the exceptions be, and to what conditions 
should they be subject?   
(ii) If all non-LDC developing Members were fully exempted from eventual 
prohibitions on, for example, subsidies for vessel construction/modification, 
and operating costs, how could it be en sured that such subsidies would not 
contribute to overcapacity or overfishing?   
(iii) On what other basis could S&D treatment be structured? 
(e) Should some or all exemptions for deve loping Members be conditional on fisheries 
management?   
(i) If so, which exemptions should be subject to such conditionality? 
(ii) What sort of fisheries management conditionalities should these be and how 
could their effectiveness at preven ting overcapacity and overfishing be 
ensured?  Would self-certification that management was effective be sufficient? 
(f) If S&D exceptions were not conditioned on fisheries management, what other 
conditions should there be, if any, and how would those operate to prevent the 
subsidies from contributing to overcapacity or overfishing?   
(g) What is the appropriate role for technical assistance for developing Members to 
implement new disciplines?   
(i) How can effective technical assistance for the implementation of management 
conditionalities be ensured while not indirectly making more resources 
available to subsidize?   
(ii) How can developing Members' needs and donor Member's capabilities be 
reconciled in a way that contributes most efficiently to fulfilling the mandate?   
 
GENERAL DISCIPLINE/ACTIONABILITY
 
16. Under the existing provisions of the SCM Ag reement, specific subsidies benefiting the 
fisheries sector are actionable, and thus can be the subject of multilateral adverse effects challenges 
(e.g. serious prejudice) and countervailing measures if  the applicable conditions are present.  These 
provisions are not, however, designed to clearly id entify any contribution that such subsidies may 
make to overcapacity or overfishing.  With a view to creating predictability and certainty concerning 
how to identify and address such effects, my first draft text contains certain guidelines on the basis of 
which a Member could challenge another Member's s ubsidies if those subsidies caused depletion of or 
harm to, or creation of overcapacity in respect of , stocks whose range extended into the challenging 
Member's EEZ, or particular stocks in which th at Member had identifiable fishing interests.   
(a) Should new fisheries subsidies rules define  any fisheries-specific negative effects 
from subsidies that could be challenged by other Members?   
(b) If so, how should such effects be defined? TN/RL/W/236 
Page 90  
 
  (i) To what extent, if at all, should impl ementation by the subsidizing Member of 
sound fisheries management be consid ered to relevant evidence for a 
determination of whether its subsidi es have caused such effects?  Why? 
(ii) What additional or alternative evid ence would be relevant?  Why?   
(c) If no parameters are established in respect  of relevant evidence, what would be 
alternative approaches to ensure predictab ility and certainty in the application of 
general subsidy disciplines? 
 
FISHERIES MANAGEMENT CONDITIONALITIES
 
 
17. The discussions in the Negotiating Group indicate that participants generally believe that 
exceptions – both general and S&D – should not be unconditional, give n their potential to undercut 
the effectiveness of the disciplines on subsidies that  contribute to overcapacity and overfishing.   
18. The discussions also have indicated a widely-s hared view that the principal conditionalities 
should pertain to fisheries management, a central co mponent of which would be stock assessments, in 
part because of the difficulties of directly measuring the effect of particular subsidies on particular 
wild capture fisheries due to the mobile a nd undomesticated nature of the resource.   
19. There are, however, differing views as to how much detail WTO fisheries subsidies rules 
should contain on fisheries management, in respect of both the substantive basis of such conditionalities and the appropriate fora and mech anisms for monitoring and enforcing their 
implementation.  There has been considerable debate  on the approach taken to these issues in my first 
draft text.   
20. I would ask participants to reflect on the following questions:  
(a) Are there other conditionalities that should be  applicable to exceptions (general and 
S&D), either in addition to or instead of fisheries management conditionalities? 
(b) How important is it for the effective operation of the disciplines that all Members' 
fisheries management systems and measures adhere to a common standard, and how 
prescriptive should that standard be?   
(c) If a common standard is not necessary or not  acceptable, how could the effectiveness 
of different Members' systems in c ontrolling overcapacity and overfishing be 
monitored and enforced?   
- What would prevent one Member with ineffective management from 
overfishing stocks that were safeguard ed/replenished by another Member's 
effective management measures?   
(d) Given that an international consensus already exists in respect of a substantial number 
of international fisheries management inst ruments, and those instruments themselves 
take account of the capacity constraints of developing countries, does it make sense to 
draw inspiration from those instruments fo r the substantive content of management 
conditionalities for using exceptions from the prohibition?   
(i) If not, why not?  TN/RL/W/236 
 Page 91 
 
 
  (ii) If so, how could the typically non-binding nature and relatively general and 
flexible wording of those instruments be reconciled with a binding prohibition of subsidies that contribute to overcapacity or overfishing, and binding conditionalities concerning fisheries manage ment where exceptions are used?   
(e) What role should stock assessments play in any management conditionalities?   
(i) If stock assessments are considered unnecessary, why, and how could 
overfishing and overcapacity be mon itored in the absence of stock 
assessments? 
(ii) If stock assessments are considered to be a necessary element, how could the 
rules take into account Members' diffe rent capabilities while ensuring that the 
assessments are as reliable and robust as possible?   
(iii) To what extent if at all should the results of stock assessments form part of 
any conditionalities? 
(f) Is it logical to require a stock assessmen t before a capacity-enhancing subsidy is 
provided?   
(i) If not, why not? 
(ii) If so, what practical problems would need to be resolved?  
(iii) What timing and review mechanism for such stock assessments could best 
reconcile a Member's need to implemen t a given subsidy on the one hand, and 
other Members' need for multilateral surv eillance/transparency in respect of 
the fisheries resources that would be affected by it on the other hand? 
(g) Given the existing role of the FAO in discussing FAO members' substantive 
implementation of various international fisheries instruments, what specific problems/concerns would there be if that role were enhanced in respect of stock assessments and/or fisheries management systems?  
- Would the problems be the same if the review at the FAO were similar to 
reviews of notifications by WTO bo dies (i.e., multilateral review among 
members, for transparency, rather than  a mechanism for approval, whether by 
a panel of experts or a multilateral body)?  
(h) Why, if at all, would the WTO be bette r-positioned to perform such reviews of 
fisheries-related information?   
- How could the necessary expertise be built into any WTO-based review of 
fisheries management, without the WT O becoming a fisheries management 
organization? 
 
TRANSPARENCY 
 
 
21. Most participants appear to believe that e nhanced transparency in respect of fisheries 
subsidies should be an important outcome of the negotiations, as a necessary element in ensuring that 
the disciplines operate effectively.  In this regard , my first draft text includes specific transparency TN/RL/W/236 
Page 92  
 
  provisions that would apply where exceptions are used ; in particular, information related to subsidies 
for which exceptions were invoked w ould be notified to, and reviewed by, the WTO, and there would 
be consequences for non-notification.  Concerning tr ansparency in respect of fisheries management, 
given the technical questions that would arise in re view of Members' fisheries management systems, 
as outlined in the previous section, my first draf t text envisages a multilateral mechanism that would 
make use of outside fisheries expertise and institutions.   
22. I would ask participants to reflect on the following issues: 
(a) Assuming that notifications would be requi red in respect of subsidies for which 
exceptions from the prohibition were invoked, is it logical for such notifications to 
include information addressing the conformity of the subsidies with the specific 
criteria and characteristics of the invoked exceptions?   
(b) Would a requirement to notify such subsidi es after rather than before they were 
implemented be effective in ensuring that the pertinent criteria were respected?  Are there effective alternatives?  
(c) What mechanisms could be built into the rules to create incentives to notify?   
(d) If a presumption that non-notified subsidies ar e prohibited is either not workable or 
not acceptable, what other approaches would be effective in encouraging the submission of complete and timely notifi cations, so as to provide meaningful 
information to Members?  
 DISPUTE SETTLEMENT
 
 
23. On dispute settlement, depending on the specific disciplines agreed, disputes clearly could 
arise which would focus on technical questions relate d to the fisheries sector rather than on purely 
legal issues.  My first draft text suggests a mechanis m that could be used to bring fisheries expertise 
into the dispute settleme nt process as needed.   
(a) Is it necessary for WTO fisheries subsidies ru les to provide for a specific mechanism 
by which panels can obtain scientific and othe r technical expertise related to fisheries 
issues that may arise in disputes?   
(i) If so, why would the provisions in Article 13 of the DSU not be sufficient? 
(ii) Should resort to any such mechanism be mandatory for all panels dealing 
with disputes under the fisheries subsidies rules, or should such resort be at 
the discretion of each panel? 
(b) If such a specific mechanism is considered unnecessary, how could necessary 
expertise be assured in disputes involving technical fisheries issues?   
(c) How could it be ensured that panels woul d make use of available mechanisms, in 
particular the provisions in Article 13 of the DSU, when necessary?   
  TN/RL/W/236 
 Page 93 
 
 
  IMPLEMENTATION  
 24. Given that any mechanisms ultimately agreed as part of new disciplines on fisheries subsidies 
will imply a certain degree of institutional infrastru cture, expertise and resources, it is clear that 
implementation of the disciplines would pose certain difficulties, especially for developing Members.  
My first draft text envisages certain flexibilities in  this respect, such as the possibility for regional 
bodies to fulfil the roles otherwise envisaged fo r national mechanisms, at least for developing 
Members, as well as provisions on technical assistance.   
25. Participants are asked to consider the followi ng issues in respect of the implementation of 
new disciplines:   
(a) What concrete mechanisms could be incl uded in fisheries subsidies disciplines to 
facilitate their implementation to the maximum possible extent? 
(b) Would such mechanisms be limited to im plementation of fisheries management, or 
would they address other aspects of the disciplines as well? 
(c) To the extent that disciplines foresee implementation of management or other 
obligations on a regional basis, how could it be ensured that the obligations were 
fulfilled in respect of and by each Member individually? 
 TRANSITION RULES
 
 26. It is clear that whatever the new disciplines, Members would need a certain amount of time to 
bring their existing measures – subsidies and pot entially fisheries management systems – into 
conformity.  My first draft text parallels the a pproach in the SCM Agreement, envisaging a longer 
transition period for developing than developed Members.   
27. I would ask Members to reflect on the following points: 
(a) What would be the specific purpose of a transition period in the context of new 
disciplines on fisheries subsidies? 
(b) Should a transition period for bringing otherw ise prohibited subsidies into conformity 
with new rules be available only in respect of such subsidies that have been notified?   
(c) To what extent should the length of a trans ition period be linked to the strength of the 
disciplines (i.e., the degree of the new obligations imposed on Members)?   
(d) How should a transition rule for developing Members take into account the nature and 
extent of special and differential treatment?   
(e) Should a transition period be linked to implementation of fisheries management 
systems on which exceptions would be conditioned, or should it only relate to bringing otherwise prohibited subsidies into conformity with the new disciplines? 
(f) Should transition periods vary based on the particular type of subsidy involved?  
What would be the implications of su ch differentiation on overcapacity and 
overfishing?   TN/RL/W/236 
Page 94  
 
  (g) Should a transition rule require Members to report during the transition period on 
their progress in implementing new obligations?   
__________