ARTICLES 6.10 AND 9.4 – SAMPLING AND ALL OTHERS RATE

Paper by BRAZIL

The following communication, dated 19 September 2014, is being circulated at the request of the Delegation of Brazil.

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1  Introduction

In response to the call of the Committee on Anti-Dumping Practices for papers on topics for discussion at the Working Group on Implementation Meetings, Brazil is pleased to submit the following paper describing the practice of the Department of Trade Remedies (DECOM), Brasília, Brazil, regarding the selection of exporters or producers to determine individual dumping margin and the calculation of "the all others rate" set forth in Articles 6.10 and 9.4 of the Anti-Dumping Agreement.

2  Brazilian Legal Framework

The domestic legal framework in Brazil for the proceedings on antidumping investigations is the Decree No. 8.058/2013, which entered in force on 1 October 2013.

Despite preferably having to determine individual dumping margins to each known producer or exporter of the product under consideration, the Department is allowed to limit its examination to a reasonable number of interested parties or product types by using samples which are statistically valid on the basis of information available at the time of the selection, or to a selection of those producers or exporters who account for the largest percentage of the volume of exports from the exporting country which can reasonably be investigated.

The Department will list, in decreasing order of volume, the producers or exporters who account for the largest export volumes to Brazil. If some of the selected producers or exporters request their exclusion from the selection after confirming their participation or fail to respond to the questionnaire, they may have their margin of dumping determined on the basis of the best information available.

It is possible for the Department to include, at its discretion, another producer or exporter in the selection. Decree No. 8.058/2013 also states that any selection shall preferably be accomplished after consultations with producers, exporters or importers in order to obtain their consent.

For other producers or exporters not included in the selection who submit the necessary information in time to be taken into consideration, an individual margin has to be determined by the Department, unless the number of producers or exporters asking for individual margins is so large that prevent the completion of the investigation within its time limits.

The Department provides a period of 10 (ten) days, from the date of acknowledgment of the notice of initiation of the investigation, so that the government of the exporting country can submit statements on the selection as to explain whether the selected companies are exporters, trading companies or producers of the product under consideration.

3  The Practice of the DEPARTMENT

Until recently the Department did not select exporters or producers to determine individual dumping margins. However, with the increase in the number of responses to the questionnaires, the Department has begun selecting exporters or producers to send questionnaires. Nevertheless, the Department has never chosen importers or product types. Therefore, its only experience regards the selection of exporters or producers.

Based on the information from other government agencies, such as customs and import statistics, which allow for the identification of the importer, exporter and the foreign producer, the Department will list the producers or exporters who account for the largest percentage of the volume of Brazilian imports. From the database provided by other agencies, the Department will extract and use the data on foreign producers to determine individual dumping margins.

Decree No. 8.058/2013 provides two methods for the selection. The first method is characterized by the use of samples statistically valid and the second one by the use of the largest percentage of the volume of Brazilian imports which can reasonably be investigated. The Department has chosen the second method.

Based on a cost/benefit analysis, the Department assesses the number of questionnaires to be sent in each investigation. The number of producers or exporters selected depends, mainly, on the number of origins to be investigated and the number of producers or exporters in each origin. Furthermore, the Department considers the distribution of the volume of Brazilian imports. Depending on all the listed factors, the practice of the Department is to select two to four producers or exporters of each exporting country.

Furthermore, in what concerns the provision that no measures should discourage the submission of information, the Department allows other producers or exporters to download the questionnaire directly of the Department's website and it publicizes this at the notice of initiation of the investigation.

In cases where there is no response of producers or exporters or when the Department receives responses of those who are responsible only for a small percentage of the volume of imports, even when considering voluntary responses, the Department may carry out a new selection procedure. The new selection will be based on the same criteria as the first one.

With respect to the antidumping duties to be applied, the practice of the Department distinguishes three groups, based on their participation in the procedure. The first group, that consists of producers or exporters who were selected and responded the questionnaire, receives duties based on individual dumping margins calculated with the use of their own data.

For the second group, composed of producers or exporters known by the Department yet not selected, as set forth in Article 9.4 of the Anti-dumping Agreement, the Department calculates the weighted average of those producers or exporters in the first group to determine the second group's duty.

The third group is formed by those producers or exporters unknown by the Department or that failed to provide an appropriate response to the questionnaire. The duty applied to the third group is calculated by using the best information available.

At last, it is worth highlighting that in cases where the Department receives only voluntary responses to the questionnaire, as a general rule, the Department calculates their dumping margins based on their own data, although it is not certain that those dumping margins will be used to calculate all others rate. The purpose of this decision is to avoid cases where producers and exporters work together to choose which one will respond in order to guarantee a better dumping margin.

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