WORLD TRADE  
ORGANIZATION  G/ADP/Q2/BRA/3 
17 October 2008 
 (08-5001) 
Committee on Anti-Dumping Practices Original:   Spanish 
  
 
ANTI-DUMPING INVESTIGATION INITIATED BY BRAZIL ON 
IMPORTS OF UNPRINTED BIAXIALLY ORIENTED 
POLYPROPYLENE (BOPP) FILM FROM 
VARIOUS COUNTRIES 
 
Questions Posed by PERU to BRAZIL
 
   The following communication, dated 15 October 2008, is being circulated at the request of the delegation of Peru. 
 
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  By SECEX Circular No. 60 of 26 August 2008, t echnically substantiated by the report on the 
initiation of an investigation, Opinion No. 23 of  the Department of Commercial Defence (DECOM) 
(the Brazilian investigating authority), the Foreig n Trade Secretary of the Brazilian Ministry of 
Development, Industry and Commerce decided to ini tiate an anti-dumping investigation on unprinted
 
BOPP film from various countries, including Peru.   Article 5.2 of the WTO Anti-Dumping Agreement (hereinafter the "AD Agreement"), states 
that an application for the imposition of anti-dum ping measures must contain evidence of dumping, 
injury and a causal link between the dumped imports and the alleged injury.  It specifies that, in order 
to meet the necessary requirements for initiating an investigation, simple assertion unsubstantiated by 
relevant evidence cannot be considered sufficient . 
  Article 5.3 of the Agreement requires the authorities to examine " the accuracy and adequacy
 
of the evidence provided in the application ", in order to determine whether there is sufficient evidence  
to justify the initiation of an investigation.   Peru considers that the fulfilment of these obligations is a fundamental right of all WTO Members, which should be strictly monitored in this Committee.  Consequently, we should be 
grateful if the Government of Brazil would answer the following questions: 
 
BASIS FOR THE DETERMINATION OF DUMPING  
 
I. PROBLEMS OF PRICE COMPARABILITY 
 The Initiation Report (section 4.1.6) indicates th at, as access to domestic sales in Peru was not 
possible and no data could be obtained on Peruvian  exports to third markets, normal value was 
determined on the basis of United States import pr ices of BOPP film from Peru, as obtained from the 
web site of the United States Trade Commission.  G/ADP/Q2/BRA/3 
Page 2  
 
   In its analysis of the application, DECOM found that virgin (unprinted) film is classified in 
Brazil – and in various countries – under the same tariff headings as printed film (converted into 
flexible packaging) which has a higher added value and price.   Being aware of this situation, when calculating the export price from Peru to Brazil (in order 
to determine dumping), DECOM makes a distincti on in its customs statis tics between "unprinted 
BOPP film" (the product under inves tigation), "printed BOPP film" and other types of film not subject 
to investigation.  However, in determining normal value on the basis of Peruvian export prices to the 
United States, DECOM does not isolate the product under investigation, using the same basis of comparison for the product under investigation as fo r others with higher added value and price. 
 
Question 1
 
  In the dumping determination on Peruvian e xports, could the Brazilian Government explain 
how it guarantees a fair comparison between normal value and export price, if the basis used for 
determining normal value involves a mixture of products different from the product investigated? 
 Question 2
 
  If the authority was aware or should have been  aware that the price of "printed BOPP film" 
was much higher than that of "unprinted BOPP fi lm" (the product under inv estigation), could Brazil 
explain why this distortion was allowed in the comparison, as it is clear that the likely effect would be 
to create or magnify the dumping margin?  Question 3
 
 
 Could the Brazilian Government  explain how, in that case, it guarantees compliance with the 
obligations laid down in Article 5.3 of the AD Agre ement, which requires that the authorities examine 
"the accuracy and adequacy  of the evidence provided in the application ", in order to determine 
whether there is sufficient evidence  to justify the initiation of an investigation? 
 
II. COMPLIANCE WITH THE DEFINITION OF DUMPING UNDER ARTICLE 2.1 OF 
THE AD AGREEMENT 
 According to Article 2.1 of the AD Agreement,  a product is dumped when its export price is 
less than its normal value, that is, less than the comp arable price, in the ordinary course of trade, for 
the like product  when destined for consumption in the exporting country. 
 
 Following a review of Peruvian customs statis tics, which are freely available to the public on 
the web site www.sunat.gob.pe and "reasonably availa ble" to the applicants and DECOM, and with 
confirmation by the Peruvian exporter, it was ascer tained that there were no exports of the subject 
product to the United States during the year 2007  (the period investigated for the determination of 
dumping).  This being the case, it would appear that the product exported to Brazil was compared with other products different from the one under inves tigation, using aggregate statistics of exports to 
the United States. 
 Question 1
 
  Could the Brazilian Government explain how it can be guaranteed that the price comparison 
conducted was consistent with the definition of dumping laid down in Article 2.1 of the 
AD Agreement, if there were no exports of the product under investigation to the third reference 
country considered for determining normal value?   G/ADP/Q2/BRA/3 
 Page 3 
 
 
  Question 2  
  Could Brazil explain whether it examined th e "adequacy" of the evidence considered to 
determine normal value (export prices to the United St ates), within the meaning of Article 5.2 of the 
AD Agreement, if there were no exports of the prod uct under investigation to that reference market 
during the period analysed? 
 Question 3
 
  Could the Brazilian Government explain how it can be guaranteed that there was "sufficient 
evidence" of dumping under the above-mentioned conditio ns, within the meaning of Article 5.3 of the 
AD Agreement?  
III. REPRESENTATIVENESS OF THE REFERENCE MARKET USED 
 According to the statistics used  by the applicant, the United St ates market, taken as the "third 
country of reference" to determine normal value, ac counted for barely 3 per cent of Peru's exports to 
Brazil.   Using this reference market and the above -mentioned methodology, a dumping margin of 
82 per cent was calculated for imports from Peru.  Th is margin is so high that it has considerably 
restricted demand for BOPP film from the Peruvian exporter since the initiation of the investigation 
became known. 
 Question 1
 
  Could the Brazilian Government explain how  such unrepresentative exports could be 
considered as "adequate" and "sufficient evidence" to  justify the initiation of an investigation pursuant 
to Articles 5.2 and 5.3 of the AD Agreement?   According to DECOM Technical Opinion No . 23 substantiating the initiation of the 
investigation, DECOM had access to import statisti cs for Argentina and Chile, which were presented 
by the applicant in the case of the former a nd which were publicly accessible through government 
channels in the case of the latter.  Peru exporte d significant quantities of the subject product to both 
Argentina and Chile, which accounted for 74 per cent and 23 per cent, respectively, of the quantities 
exported to Brazil.  Question 2
 
 
 Could the Brazilian Government explain why no consideration was given to exports to these 
two destination markets, which are much more repr esentative than the United States, if statistics were 
reasonably available to the applicants and to DE COM for the purpose of properly conducting such a 
comparison?  Could Brazil explain why it considers that it acted objectively and impartially in accepting such unrepresentative exports and not cons idering available alternatives which could be 
used to differentiate the like product an d verify the absence of a dumping margin? 
 
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