ADA - Seminar

A. Quick quiz
1. Are exporters in a WTO member allowed to dump their products in export markets?

Maybe, because it depends on the price and normal value of this country instead of another country
according to Art.6 GATT 1994

2. Can a shrimp producer in a WTO member request for the application of a countervailing
measure against actionable subsidy by the government of another WTO member on steel products?

Nope it must be the like product. Steel doesn’t relate to the shrimp

3. The interest rate of borrowing state capital in a WTO member is 6 percent and this capital is
open to any company. However, the commercial interest rate is 7.5 percent. Can the state loan at
6% be considered as an actionable subsidy?
Not a financial contribution to and not conferred a benefit
 No, under art.14 of SCM
4. In 2012-2015 imports of shoes into country X – a WTO member increases by 5 % each year.
The domestic production of X remains constant over this period. Can a finding of “increased
imports” consistent with Article 2.1 of the Agreement on Safeguard Measures?

There no evidence, not emergency, didn’t mention about the injury, not follows the 2.1

5. The investigating authority finds that the volume of fertilizer imports has consistently
decreased during 2012-2015. However, it also finds that due to the serious mistake in management,
Company X accounts for 70% of the country’s total production of fertilizer kept suffering from
huge losses during 2014-2015. In conclusion, the authority assumes that the domestic industry is
suffering serious injury and a safeguard measure should be imposed on imported fertilizer. Is that
conclusion consistent with the Agreement on Safeguard Measures?

Cause from the increase imports of the product => no relating

B. Case study
1. Upon receiving request from Company A and Company B, Vina- a WTO member decides to
initiate an antidumping investigation against steel nails imported from Bana and Hana – also two
WTO members. The period of investigation is determined as 1 January 2016 – 31 December 2016.
2. In 2016, Company A and Company B accounted for 10% and 30% respectively of the Vina’s
total production of steel nails. Company C accounting for 40% of Vina’s total production objects
the investigation while Company D accounting for 20% does not favor or object the investigation.
3. Company X is a steel nail producer in Bana and has exported this product to Vina for more
than 4 years. In order to facilitate its sale to Vina, in 2015, Company X established a subsidiary Y
in Vina to import the steel nail it manufactures. The price X charges Y is artificially higher than
the price Y charges customers in Vina.
4. In 2016, Company X exported 100,000 tons of steel nails to Country A while it sold only 5
tons in Bana. However, the sell price in Bana is much lower than the export price to Vina.

Questions to solve:

a) Is Vina’s antidumping investigation initiation supported by the ADA?

It is supported by those domestic producers whose collective output constitutes more than
50% of the total production of the like product produced by that portion of the domestic
industry expressing either support for opposition to the application.

b) How does the authority in Vina determine the export price of X?

c) X argues for the use of sell price in Country B as the normal price of steel nails in an
antidumping investigation by Country A. This argument is rejected by the authority in
Country A. Is such rejection consistent with the ADA? Why or why not?

C. Case study
Sir is a tailor company manufacturing men`s suits from Vietnam, they have successfully produce a
line of new suits calls Sir Bespoke. This type of suit has become very popular in EU. Now the UK,
Italy and Spain suit industry is struggling and employment in this industry is shrinking
dramatically.

EU decides to impose quota on import of suits to 50 million suits a year. The quota is divided as
follows: Bangladesh ( 30 million), China (10 million), others ( 10 million). Last year the export
from Vietnam was 10 million suits. The quota was published on the official website. Foreign
companies could apply for import license which is granted by the EU board. The representatives of
EU suit manufacture also sit on the board. Moreover, EU requires that the importation of suits
should be through the port Rostock, Germany. The justification was not given.

Several governments from EU have requirement that government departments and arm forces can
only buy cloth from domestic manufacture. In addition, all cloth repair work should be done by
domestic companies.

Fearing the quota and other measures above, Sir company decided to set up its own chain of
distribution in export countries. However, under regulations of EU, the number of shops is limited
due to economic need. In addition, the employee should be EU citizen and speak domestic
language.

You are a junior lawyer, working at International Law Company Thanh and Partners, based in
Hanoi. The director of the law company asked you to prepare a summary of the above case on
consistency of trade barriers according to WTO regulations and present to your client, Sir
company.

D. Case study
1. Country A has four major producers of garment: Viet Thang, May 10, Nha Be and Dong Xuan.
Their total market share is 80% of domestic market. The rest is divided among many other small
manufactures. In recent years, the export to country Y of those four companies from country A has
significantly increased.

In the contrary, the garment industry of country B has contracted rapidly because of the cheap
import from country A. Thus, many producers went to bankrupt. The four remaining biggest
producers which represent 60% of total production in country B, want to oppose import from
country A. They asked the government to impose anti-dumping measure on the garment from
country A to decrease to import volume from country A. Their argument is that the garment from
country A is sold at the price below the cost of production. Particularly, the t-shirts produced by
Dong Xuan and Nha Be. However, during the investigation, El Pano, one of the four biggest
producers in country B, has revoked the claim and established a joint venture with Dong
Xuancompany to manufacture garment in Cambodia.

The garment association of country A was informed on the investigation of anti-dumping. Deterred
by the situation, government of country A turns to Advisory Centre for legal advice. The
government A wants to know: Under which conditions, country B can impose anti-dumping
measures consistent with WTO regulations? Whether duties can be imposed on all garment from
country A? When the duties can be imposed and how long is the duration of imposition? What is
the maximum level of application?

You are the junior lawyer at the Center. The Director of the Advice Center has required you to
prepare a legal brief addressing the concerns of government from country A and present to the
representative from country A.

2. Let us assume that Medatia and Vanin are WTO Members. Vanin Vegi is a producer of
vegetables in Vanin. Due to the excessive production of tomatoes in the world during the current
year and the increased availability of tomatoes on the international market, Vanin Vegi is unable to
sell its tomatoes. If Vanin Vegi does not find a market for its tomatoes, it will face great losses.

Vanin Vegi decides to sell its tomatoes in Medatia at prices below the market price for tomatoes of
similar quality in Medatia. Vanin Vegi prices 1 kg of tomatoes at $1.00 in Medatia, while it prices
the same tomatoes at $US 2 in Vanin. Medatian tomato producers are experiencing a slump in their
tomato sales. They consider that the reason for this is the imports of tomatoes from Vanin at lower
prices.

Question 1

Assume you are an expert on WTO law and Medatian tomato producers ask for your advice on
what type of trade remedy they can request their government to apply to imports of tomatoes from
Vanin.

Question 2

Assume you are the authority in charge of anti-dumping investigations in Medatia: what would you
have to do after receiving the request of the domestic producers of tomatoes for the application of
anti-dumping measures to Vanin Vegi tomatoes?