BRAZIL – ANTI-DUMPING MEASURES ON IMPORTS OF CERTAIN RESINS FROM ARGENTINA
Document: Request for Consultations by Argentina
Date: 9 January 2007
Document codes: WT/DS355/1; G/L/810; G/ADP/D71/1
Complainant: Argentina
Respondent: Brazil
Third parties: EU, Japan, Taiwan, U.S.
Dispute stage: Panel
Agreements cited: Art. 6.1, 6.2, 6.4, 6.6, 6.8, 6.9, 2.2.1.1, 2.2.2, 2.4, 3.1, 3.2, 3.4, 3.5, 8.3, 10.1, 12.1, 12.1.1, 12.2, 12.2.2, 18.4  Anti-dumpingArt. VI, X:1, X:3  GATT 1994Art. XVI:4  Agreement Establishing the World Trade OrganizationAnnex II  Anti-dumping

BRAZIL – ANTI-DUMPING MEASURES ON IMPORTS
OF CERTAIN RESINS FROM ARGENTINA

Request for Consultations by Argentina

 The following communication, dated 26 Decemb er 2006, from the delegation of Argentina to
the delegation of Brazil and to the Chairman of the Dispute Settlement Body, is circulated in
accordance with Article 4.4 of the DSU.

 My authorities have instructed me to re quest consultations with the Government of
Brazil pursuant to Article 4 of the Understanding on Rules and Procedures Governing the Settlement
of Disputes, Article XXII:1 of the General Agreement on Tariffs and Trade 1994 ("GATT 1994"), and
Article 17 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and
Trade 1994 ("AD Agreement"), with respect to Brazil's anti-dumping measures relating to imports of
polyethylene terephthalate ("PET") resins from Ar gentina, as well as any amendments thereto or
extensions thereof
1 and any related measures, and also with respect to certain provisions of Brazil's
Decree No 1602 of 23 August 1995 and Decree No 4732 of 10 June 2003.

 On 10 September 2003, Rhodia Ster Fibers a nd Resins Ltda., whose trade name was later
changed to M&G Fibers and Resins Ltda., filed a petition, by means of which it requested the opening
of an investigation of dumping, injury to the domestic injury and causal link between the two, on
imports of PET resins exported by Argentina a nd other countries. On 2 March 2004, the Foreign
Trade Secretary ("SECEX") of the Ministry of De velopment, Industry and Foreign Trade decided to
initiate the investigation through Circular SECEX No 10.2

 On 26 August 2005, the President of the Ministers Council of the Foreign Trade Chamber
("CAMEX"), through Resolução No 29, de 26 de Agosto de 2005, da Cãmara de Comércio Exterior
CAMEX, do Conselho de Goberno
3, resolved, ad referendum of the Council, to terminate the
investigation with the application of an anti-dumping duty on the imports of PET resins, with intrinsic
viscosity over 0.7 dl/g , excluded added resins of glass fiber and other blends, classified under item
3907.60.00 of the NCM4, originating from Argentina.

 On 16 December 2005, this measure appears to have been ratified by the Council of Ministers
of CAMEX.

1 This includes any further determinations made pursuant to court order or remand.
2 Published in the Diario Oficial da Uniao on 3 March 2004.
3 Published in the Diario Oficial da Uniao on 2 September 2005.
4 Nomenclatura Comun Mercosur (Mercosur Common Tariff Schedule).

 Argentina considers that the investigation c onducted, the determinati on made and the duties
imposed violate Brazil's obligations under the provisions of GATT 1994 and the AD Agreement. In
particular, Argentina believes that the anti-dumpi ng measures on PET resin are inconsistent with, at
least, the following provisions:

• Article 6 and Annex II of the AD Agreemen t, because Brazil failed. throughout the
investigation, to inform the respondent Ar gentine exporter of perceived deficiencies
in its responses to the Brazilian authoriti es' questionnaire; failed to provide the
respondent Argentine exporter an opportunity to provide further explanations within a
reasonable period; failed to provide the respondent Argentine exporter with ample
opportunity to present in writing all evidence which it considered relevant in respect
of the anti-dumping investigation; failed to give it a full opportunity for the defence
of its interests; failed to provide timely oppor tunities for all interested parties to see
all information that is relevant to th e presentation of their cases and to prepare
presentations on the basis of this informati on; and failed to inform it of the essential
facts under consideration which formed the basis for the decision to apply definitive
measures in sufficient time for the responde nt Argentine exporter to defend its
interests;

• Articles 2.2.1.1, Article 6 and Annex II of the AD Agreement and Article VI of
GATT 1994, because Brazil substituted the facts available for the respondent
Argentine exporter's actual records regarding the primary input into PET resin, which
records were in accordance with the generally accepted accounting principles of
Argentina and reasonably reflected the cost s associated with the production and sale
of the product under consideration; and by failing to use special circumspection in
basing their findings on information from a secondary source;

• Article 2.2.2, Article 6 and Annex II of the AD Agreement and Article VI of
GATT 1994, because Brazil substituted the f acts available for the respondent
Argentine exporter's actual data regardi ng administrative, selling and general costs
and for profits pertaining to production and sales in the ordinary course of trade of the
like product by the Argentine exporter under investigation; and by failing to use
special circumspection in basing their findings on information from a secondary
source;

• Article 2.2.1, Article 6 and Annex II of the AD Agreement and Article VI of
GATT 1994, because Brazil improperly treated sales of the respondent Argentine
exporter's like product allegedly at prices below per unit costs of production plus
administrative, selling and general costs in the domestic market of Argentina as not
being in the ordinary course of trade by reason of price and disregarded them in
determining normal value;

• Article 2.4, Article 6 and Annex II of the AD Agreement and Article VI of
GATT 1994, because Brazil, in calculating th e profits accruing to be deducted from
the export price on sales in Brazil made by the affiliated party of the respondent
Argentine exporter of PET resin after impor tation, substituted the facts available for
the actual profit realized on the sales by the affiliated party of the respondent
Argentine exporter;

• Article 2.4 of the AD Agreement and Article VI of GATT 1994, because Brazil
improperly denied adjustments to nor mal value and export price for volume
discounts, debits and credits for price adjust ments, customer credits, as well as level
of trade differences granted by the respondent Argentine exporter to individual
customers, failing to make a fair comp arison between the export price and normal
value;

• Articles 3.1, 3.2 and 3.4 of the AD Agre ement, because Brazil, in conducting its
injury analysis, failed to collect or examin e recent data, and failed to base its injury
determination on positive evidence or to conduct objective examinations of the
volume of dumped imports, the effect of those imports on prices in the domestic
market of the like product, and the impact of the imports on domestic producers of
those products;

• Articles 3.1 and 3.5 of the AD Agreement, because Brazil failed to demonstrate that
the allegedly dumped imports are, through the effects of dumping, causing injury;
failed to base its determination of a causal relationship between the allegedly dumped
imports and injury to the domestic indus try on positive evidence and an objective
examination of all relevant evidence; faile d to examine all known factors other than
the allegedly dumped imports which at th e same time are allegedly injuring the
domestic industry; and attributed the alleged injury caused by these other factors to
the allegedly dumped imports;

• Article 8 of the AD Agreement, because Brazil rejected a proposed price undertaking
based on the disapproval of the petitioni ng domestic industry, and because the
Brazilian authorities did not provide reasons causing them to consider an undertaking
inappropriate;

• Article 10 of the AD Agreement, becau se Brazil began applying anti-dumping duties
to products which entered for consumpti on prior to the time when the decision to
impose anti-dumping duties entered into force; and

• Article 12 of the AD Agreement, because Brazil failed in its public notice of initiation
to provide adequate information concerning th e product involved in the investigation;
and failed in its final determ ination to set forth in sufficient detail the findings and
conclusions reached on all issues of fact and law considered material or to provide all
relevant information on the matters of f act and law and reasons which led to the
imposition of final measures.

 In addition, the following provisions of Brazil's Decree No 1602 of 23 August 1995
("Decree 1602/95") and Decree No 4732 of 10 June 2003 ("Decree 4732/03") appear to be
inconsistent with Brazil's obligations under the provisions of the AD Agreement, the GATT 1994 and
the Marrakesh Agreement Establishing the World Trade Organization ("WTO Agreement").

 Article 2 (XV) of Decree 4732/03 authori zes a certain Brazilian governmental entity, the
"Cámara de Comercio Exterior – CAMEX, do Conselho de Governo" ("CAMEX") to impose
provisional or definitive anti-dumping measures. Article 5 §3 of Decree 4732/03 authorizes the
president of CAMEX to perform all acts of CAMEX, including the imposition of anti-dumping
measures, ad referendum of the Council of Ministers, and Brazilian law prescribes no deadline within

which the Council must ratify or reject those acts no r stipulates the legal status of the anti-dumping
measures apparently in force. These provisions appear to be inconsistent with:

• Article 6.14 of the AD Agreement, which re quires Members to act expeditiously with
regard to reaching preliminary or final determinations, whether affirmative or
negative, or from applying provisional or final measures, in accordance with the
provisions of the AD Agreement;

• Article 10 of the AD Agreement, which requires that anti-dumping duties only be
applied to products which enter for consump tion after the time wh en the decision to
impose anti-dumping duties enters into force;

• Article X of GATT 1994, which requires that laws, regulations, judicial decisions and
administrative rulings of general applicati on made effective by a contracting party be
published promptly in such a manner as to enable governments and traders to become
acquainted with them and to administer th em in a uniform, impartial and reasonable
manner;

• Article 18.4 of the AD Agreement, which requires each Member to 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, th e conformity of its laws, regulations and
administrative procedures with the provisions of the AD Agreement; and

• Article XVI:4 of the WTO Agreement wh ich requires Members to ensure the
conformity of their laws, regulations and administrative procedures with their
obligations as provided in the annexed Agreements.

 Article 58 of Decree 1602/95 provides fo r a review of the determination imposing
anti-dumping duties. This provision appears to be inconsistent with:

• Article 9 of the AD Agreement, because it does not appear to provide for collection
of the anti-dumping duty in an appropriate amount; it does not appear to provide for a
determination of the final liability fo r payment of anti-dumping duties 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 and for a
refund within 90 days following the determin ation of final liability; nor for a refund,
upon request, of any duty paid in excess of the margin of dumping 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 and for a refund within 90 days of this determination;

• Article X of GATT 1994, which requires that laws, regulations, judicial decisions and
administrative rulings of general applicati on made effective by a contracting party be
published promptly in such a manner as to enable governments and traders to become
acquainted with them;

• Article 18.4 of the AD Agreement which requires Members to take all necessary
steps, of a general or particular character to ensure that their laws, regulations and
administrative procedures are in conformity with the obligations set forth in that
Agreement; and

• Article XVI:4 of the WTO Agreement wh ich requires Members to ensure the
conformity of their laws, regulations and administrative procedures with their
obligations as provided in the annexed Agreements.

 Brazil's measures identified in this request also appear to nullify or impair benefits accruing to
Argentina directly or indirectly under the cited agreements.

 For each of the measures referred to above, this request also covers any amendments,
replacements, extensions, implementing measures or other related measures

 The Government of Argentina reserves its right to raise additional factual claims and legal
matters during the course of consultations. We l ook forward to receiving your reply to the present
request and to fixing a mutually convenient date and place for consultations.