WORLD TRADE  
ORGANIZATION  TN/RL/GEN/69 
13 October 2005 
 (05-4679) 
Negotiating Group on Rules Original:   English 
  
 
FURTHER SUBMISSION ON ISSUES RELATING TO 
THE INITIATION AND COMPLETION OF INVESTIGATIONS1 
 
Paper from Hong Kong, China  
 
  The following communication, dated 13 October 2005, is being circulated at the request of 
the Delegation of Hong Kong, China 
  The submitting delegation has requested that th is paper, which was submitted to the Rules 
Negotiating Group as an informal document (JOB(05)/ 232), also be circulated as a formal document. 
 
_______________ 
 
 A. 
INTRODUCTION  
 In TN/RL/GEN/23 (JOB(04)/152), the sponsors of  that paper noted that the initiation of an 
investigation alone has significant trade chilling effect s, not only for the companies directly involved, 
but also on trade in general.     Under the Anti-Dumping Agreement, the initiation of an investigation, of itself, cannot be 
subject to dispute settlement.
2  Initiation on the basis of inaccurate or insufficient evidence is 
problematic, since a considerable period may have to pass before the investigation is eventually 
terminated.  Meanwhile, as the investigation continu es, the exporters have to incur considerable costs 
and resources to participate in the anti-dumping pr oceedings, while combating the negative effects on 
trade at the same time.  Worse still, those e xporters who have limited costs and resources to 
participate in the proceedings may be subject to th e use of facts available, ending up with a dumping 
margin, where the investigation should not have been initiated and they sh ould not have received a 
dumping margin in the first place. 
  This paper develops draft texts for some of the proposals in TN/RL/GEN/23 (see Annex).  Our main objective is to strengthen the disciplines on initiation in order to ensure that (1) initiations 
are made only if the application has sufficient support from the domestic producers of the like product 
in the importing country, and that standing is duly observed, (2) initiations are avoided or 
investigations are terminated early if the evidence fo r the initiation is found to be insufficient, (3) after 
termination of an investigation, new initiation on th e same or like product shall not be made within 
one year.    
                                                     
 
1 The proposal contained in this document does not represent a final position and may be subject to 
further addition and/or modification in the course of the negotiations.  Other provisions of the Anti-Dumping 
Agreement that may be affected by the proposal may be examined in the later stages of the negotiations when 
Members have a more comprehensive picture of the amended Agreement. 
2 We note however that the idea of a “swift dispute settlement mechanism” for initiation has been 
suggested by some members (TN/RL/W/13, TN/RL/W/67, TN/RL/W/47) TN/RL/GEN/69 
Page 2  
 
  Our main proposals are summarised below: 
 - Standing : Replace the current standing threshold w ith a standing requirement of support from 
domestic producers whose output constitute more  than 50 per cent of the total production of 
the like product by the domestic industry.  Also clarify that, in the case of trade associations, 
standing is to be counted on the basis of support of individual members (Art. 5.4).     
 - Opportunity to comment : Provide for the exporting Member government (and, where 
practicable, exporters and foreign producers) to  be given the non-confidential copy of the 
properly documented application and a period to comment before the initiation, as well as to 
require authorities to address those comments be fore initiation/at an early stage of the 
investigation.  This will enable wrong informa tion to be identified early, avoid initiation of 
unnecessary investigations, or enable such investig ations to be terminated early.  (Art. 5.5, 
5.6, consequential amendment to Art. 6.1.3).  At the same time, the paper also proposes 
adequate opportunity to be given (whether before or after initia tion) for exporters to comment 
on model matching, and for those comments to be taken into account (Art. 5.5.1).   
 - 12-month gap : Provide for a period of 12 months to elapse after termination of an 
investigation, before a new investigation for the same or the like product, can be initiated.  
Given that investigations pose a heavy burde n for exporters (as well as for investigating 
authorities), and also have trade chilling effects, if an investigation is terminated without the 
imposition of anti-dumping measure, there shoul d be a “rest” period in order to allow 
exporters to continue to trade, and to preven t repeated petitions which would have significant 
trade chilling effects
3 (Art. 5.11, also 5.6).    
 The proposal also requires, for purposes of transparency, that authorities prior notice explaining the 
special circumstances justifying an extension of th e investigation period (Art. 5.10).  In addition, 
drafting changes to Articles 5.3 and 5.8 are introdu ced, to tie in with the wording of Article 5.6 
(references to sufficient evidence of “ dumping, injury and a causal link”). 
 
                                                     
 
3 This is also consistent with the spirit of the D ecision on Implementation Related Issues and Concerns 
adopted by the Ministers at Doha (WT/MIN(01)/W/10, para. 7.1).   TN/RL/GEN/69 
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 ANNEX  
  
Proposed changes to Article 5, and co nsequential amendment to Article 6.1.3
 
  
5.3 The authorities shall examine the accuracy and adequacy of the evidence provided in the 
application to determine whether there is suffici ent evidence of dumping, injury and a causal link
 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
4 by domestic producers of the like product, that the application has been made 
by or on behalf of the domestic industry.5  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 not less than 25 506 per cent of total production of the like product produced by 
the domestic industry.7  In the case of an application made or supported by a trade association, only 
those member producers who support the applicati on shall count towards the standing threshold.  
  
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, promptly  after receipt of 
a properly documented application and before procee ding to initiate an investigation, the authorities 
shall notify and provide the full text of such application to the government of the exporting Member 
concerned and, where practicable, to the known exporte rs and foreign producers (or the relevant trade  
associations) .  Due regard shall be provided to the re quirement for the protection of confidential 
information, as provided for in paragraph 5 of Ar ticle 6.  The government of the exporting Member 
and the exporters and foreign producers concerned shall have at least 15 days to comment on the 
standing of the applicant and the evidence ju stifying the initiation before the initiation8.  Authorities 
                                                      
4 Existing footnote 13 : 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. 
5 Existing footnote 14 : Members are aware that in the territo ry 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.   
6 Editorial note:  We are willing to discuss how to deal with the situation involving “fragmented 
industry,” bearing in mind that this situation is also addressed in existing footnote 13.  A large number of 
producers does not necessarily mean that an industry is fr agmented. It is possible that  some sectors consist of 
producers of different sizes, where a few producers already make up a large percentage of the production.  
7 Editorial note: “Domestic industry” in Article 4.1 currently refers to all the domestic producers or 
those producers accounting for “a ma jor proportion” of the total domestic  production.  We believe the standing 
threshold in Article 5.4 should refe r to “all” the domestic producers (except those excluded under Article 4.1), 
and not a “major proportion” of them.  This could be tackled by clarifying the wording of Article 5.4, or by 
clarifying the definition of “domestic industry” in Article 4.1.  
8 Editorial note: We note the propos al from several members for the product under consideration to be 
defined by the time of initiation (TN/RL/GEN/50).  Pending further discussion of that issue, this is outside the 
scope of the current text.  However, we wish to emphasi se the importance of ensuring that the exporter has 
adequate opportunity to comment on the scope of the product under consideration.   TN/RL/GEN/69 
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 shall address those comments before the initiation
9.  If this is not practicable, they shall address those 
comments within 60 days after the initiation.10 
 
5.5.1 Authorities shall also provide the exporte rs and foreign producers concerned adequate 
opportunity to comment and make proposals on model matching, including model 
classification, for the purpose of determining the identical and most closely resembling 
models, as well as to comment on those proposed by the petitioners and the authorities. 11   
 
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  the conditions under paragr aph 11 are satisfied, and 
they have sufficient evidence of dumping, injury an d a causal link, as described in paragraph 2, to 
justify the initiation of an investigation, and have provided opportunity to comment as referred to in 
paragraph 5 above . 
 
.…. 
 5.8 “An application under paragra ph 1 shall be rejected and an i nvestigation 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 or a causal link  to justify proceeding with the case…”12 
 
.…. 
 5.10 
Investigations shall, except in special circum stances, be concluded within one year.  An 
investigation shall , and  in no case last for  more than [18]13 months,  after their initiation.  Prior to an 
extension of the investigation, the authorities shall issue a public notice and shall notify known 
interested parties in writing, explaining the speci al circumstances giving rise to the need for an 
extension of the investigation, a nd giving details of the extension.  
 5.11 Where an investigation is terminated w ithout the imposition of a definitive anti-dumping 
measure, the authorities shall not initiate a new investigation into the same product or like product14 
from the same exporting Member until after a period  of 12 months has elapsed from the date of the 
termination of the investigation.  
 
….. 
                                                      
9 Editorial note: Article 12 should be amended to provide for the notice of initiation to state the 
comments received and the authorities’ findings in relation to those comments 
10 New footnote : It being understood that comments concerning complex data may not be easily 
verifiable within the 60-day period, and authorities may not be able to address those comments within that 
period.  
11 Editorial note: We are open to discussing whether such a provision should be included elsewhere in 
the Agreement, for example, in Article 2 or 6.1.  
12 Editorial note: Hong Kong, China and other Members have proposed changes to Article 5.8 
(including issues relating to de minimis, negligibility and cumulation). These proposals are outside the scope of 
this paper, and the changes are no t reflected in the current text.  
13 Editorial note: in TN/RL/GEN/23, the sponsors of that paper have highlighted the desirability of 
shortening the investigation timeframe.  The maximum duration of investigation should be revisited in the 
course of the negotiations.    
14 Editorial note: the objective here is to preven t new investigation into a product which closely 
resembles the investigated product (ie. one which is so similar to the investigated product that they could have 
been included under the same investigati on).  We have used the term “like pro duct” because it is a term used in 
the ADA to convey the sense of products which are “closely  resembling” or “substantia lly similar”.  That said, 
we are open to discussing alternative phrases to the term “like product”.  TN/RL/GEN/69 
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6.1.3 As soon as an investigation has been initiated,  the authorities shall (if they have not already 
done so before initiation) provide the full text of the written a pplication received under paragraph 1 of 
Article 5 to the known exporters15, and to the authorities of the exporting Mem ber and shall make it 
available, upon request, to other interested parties involved.  Due regard shall be provided to the 
requirement for the protection of confidential in formation, as provided for in paragraph 5. 
 
__________ 
 
 
                                                      
15 Existing footnote 16 : It being understood that, where th e 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.