Rethinking the "Like Product" Definition in WTO Antidumping Law

Journal of World Trade

Volumn 33, Issue 3, 1999, Pages 73-91

  Bronckers, Marco ^a,b   McNelis, Natalie ^a  

^a Stibbe Simont Monahan Duhot   (Belgium)

^b LEIDEN UNIVERSITY   (Netherlands)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 0033457154     PISSN: 10116702     EISSN: None     Source Type: Journal    
DOI: 10.54648/trad1999020     Document Type: Article

References (49)

1. See the Panel Report of 2 July 1998 (WT/DS54/R, WT/DS55/R, WT/DS59/R, WT/DS64/R) in the Indonesia - Certain Measures Affecting The Automobile Industry case.
2. Panel Report of 11 July 1996 (WT/DS8/R, WT/DS10/R, WT/DS11/R) and Appellate Body Report of 4 October 1996 (WT/DS8/AB/R, WT/DS10/AB/R, WT/DS11/AB/R) in the case of Japan - Taxes on Alcoholic Beverages (the Japanese Liquor Taxes II case). As mentioned above, we take note of the fact that the Panel in the Japanese Liquor Taxes II case took care to qualify its remarks by stating that its findings were "relevant only for the interpretation of the term 'like product' as it appears in Article III:2" (at para. 6.20).
3. Panel Report of 17 September 1998 (WT/DS75/R, WT/DS84/R) and Appellate Body Report of 18 January 1999 (WT/DS75/AB/R, WT/DS84/AB/R) in Korea - Taxes on Alcoholic Beverages (the Korean Liquor Taxes case).
4. Japanese Liquor Taxes II Panel Report, at para. 6.22.
5. As note 4, above.
6. Japanese Liquor Taxes II Appellate Body Report, at p. 25.
7. Korean Liquor Taxes Appellate Body Report, at para. 114.
8. Cited at note 1, above.
9. As note 7, above, at para. 14.111.
10. See Art. 5.4 of the Antidumping Agreement.
11. See the definition of "domestic industry" under Art. 4 of the Agreement on Implementation of Art. VI of the GATT 1994.
12. See para. 1 of Art. VI.
13. See Art. 4.1 of the Antidumping Agreement.
14. Where the same product exists, the determination of a "like product" is uncontroversial. On the other hand, difficulties can arise when there is no identical product sold at home or where the Commission uses an analogue country for the calculation of normal value.
15. See Art. 5.8 of the Antidumping Agreement.
16. At the Havana Conference, as noted by the GATT (1995): Analytical Index: Guide to GATT Law and Practice, Updated 6th Edition, at p. 227.
17. By the 1959 Group of Experts on "Antidumping and Countervailing Duties". That Group also "pointed out that the meaning of 'like product' as agreed by them should not be interpreted either too broadly so as to cover products of a different kind with higher prices on the internal market, nor too stringently so as to elude the application of Paragraph 1(a) of Article VI". (Id.)
18. L/5814, adopted on 18 July 1985, BISD 32nd Supp., 55, 68, paras 4.5-4.6.
19. See E. Vermulst and P. Waer (1996): E.C. Anti-Dumping Law and Practice, Sweet & Maxwell, London, at p. 282.
20. In that case, the "other factors" considered were the impact of technical progress, and the fact that producers themselves make no distinction between the products classified in different market segments with regard to production, distribution or accounting.
21. Commission Regulation No. 1418/88 of 17 May 1988 imposing a provisional antidumping duty on imports of serial-impact dot-matrix printers originating in Japan, O.J. L. 130, 26/05/88, p. 12, at point 11. The definition of the "like product" in this case was challenged and upheld by the European Court of Justice in Case C-69/89, Nakajima All Precision Co. Ltd v. Council of the European Communities [1991] ECR I-2069. The Commission's reasoning has recently been reiterated in Commission Regulation No. 165/97 of 28 January 1997 imposing a provisional antidumping duty on imports of certain footwear with textile uppers originating in the People's Republic of China and Indonesia: "It should be recalled that the main criteria to be applied in the determination of the 'like product'are based on the general technical or physical characteristics, the use or functions and finally, the consumer's perception of products...", O.J. L. 29, 31/01/1997, p. 3, at point 18.
22. As note 21 (O.J. L.29, 31/01/1997) at point 12.
23. Judgment of the Court of First Instance of 15 October 1998, Case T-2/95, Industrie des Poudres Sphériques v. Council of the European Union, not yet reported, at recital 204. See also Judgment of the Court of First Instance of 25 September 1997, Case T-170/94, Shanghai Bicycle Corporation v. Council [1997] ECR II-1383. Important past court cases that treated "like-product" issues were the numerous Photocopiers cases, such as Case C-171/87, Canon v. Council [1992] ECR I-1237; Case C-174/87, Ricoh v. Council [1992] ECR I-1335; and Case C-179/87, Sharp Corporation v. Council [1992] ECR I-1635.
24. This case was initiated by Commission Notice of Initiation of an antidumping proceeding concerning imports of certain footwear originating in the People's Republic of China and Indonesia, O.J. C45 of 22/02/95, p. 2. The provisional regulation was Commission Regulation No. 165/97, O.J. L. 29, 31/01/1997, p. 3, and the definitive regulation was Council Regulation No. 2155/97, O.J. L. 298 of 01/11/97, p. 1.
25. As note 24, above, to provisional regulation, at point 16.
26. Action brought on 19 December 1997 by BSC Footwear Supplies and Others against the Council of the European Union, Case T-598/97, O.J. C. 55, 20/02/98, p. 30 and Action brought on 28 March 1997 by British Shoe Company and others against the Commission of the European Communities, O.J. C. 166, 31/05/97, p. 17.
27. According to the Commission, because "all RBM have the same basic physical characteristics and that the types of RBM can, within a certain range, replace each other".See Commission Regulation No. 1465/96 of 25 July 1996 imposing a provisional antidumping duty on imports of certain ring binder mechanisms originating in Malaysia and the People's Republic of China, O.J. L. 187, 26/07/1996, p. 47, at points 12 and 13.
28. As note 27, above, at point 12. Lever-arch mechanisms are a common type of 2-ring binder mechanism in which the rings are opened by means of a lever.
29. Council Regulation No. 119/97 of 20 January 1997 imposing definitive antidumping duties on imports of certain ring binder mechanisms originating in Malaysia and the People's Republic of China and collecting definitively the provisional duties imposed, O.J. L. 22, 24/01/1997, p. 1, at point 14. Note that the Court of First Instance recently dismissed an action for annulment that was brought against this regulation, based not on "like product" but on procedural issues (judgment of the Court of First Instance of 19 November 1998, Case T-147/97, Champion Stationery Mfg Co. Ltd., et al. v. Council of the European Union, not yet reported).
30. See, for example, the Photocopiers cases, cited above.
31. See Commission Regulation No. 550/93 of 5 March 1993 imposing a provisional antidumping duty on imports of bicycles originating in the People's Republic of China (O.J. 1993 L. 58, p. 12, and Council Regulation No. 2474/93 of 8 September 1993 imposing a definitive antidumping duty on imports into the Community of bicycles originating in the People's Republic of China and collecting definitively the provisional antidumping duty (O.J. 1993 L. 228, p. 1). These categories of bicycles were also grouped together in the more recent Bicycles from Indonesia, Malaysia and Thailand case, Council Regulation No. 648/96 of 28 March 1996, O.J. 1996 L. 91, p. 1. This regulation was recently upheld by a judgment of the Court of First Instance of 17 July 1998, Case T-118/96, Thai Bicycle Industry & Co. Ltd. v. Council of the European Union, not yet reported.
32. See the provisional regulation in the Bicycles from China case, at recital 10.
33. See the definitive regulation in the Bicycles from China case, at recital 7.
34. As note 33, above.
35. One might query whether, if the Footwear case had been subject to the same approach, the Commission would not have found that many persons buy tennis shoes, not to play tennis, but to wear around town? It could be said that basketball shoes, like mountain bikes, have become fashion statements. That would bring these products into a closer relationship with the rubber-soled outdoor shoes that were subject to that proceeding.
36. See the provisional regulation in the Bicycles from China case, at recital 8.
37. Judgment of the Court of First Instance of 25 September 1997, Case T-170/94, Shanghai Bicycle Corporation v. Council of the European Union [1997] ECR II-1383.
38. As note 37, above, at recital 69.
39. Japanese Liquor Taxes II Panel Report, at para. 6.22; Korean Liquor Taxes Appellate Body Report, at para. 118.
40. Japanese Liquor Taxes II Panel Report, at para. 6.22; Korean Liquor Taxes Appellate Body Report, at para. 118.
41. Arguably, dumped imports that simply compete with domestic products could cause injury. However, in that regard we are inclined to agree with the position taken by Vermulst and Waer, who state: "the definition of like product is an independent, separate decision that has to be made on the basis of the definition of Article 2(12) [now Article 1(4)]. In a case like this it is indeed possible that a product [in their example, which was not produced in the EC] can nevertheless cause injury, but that does not make it a like product. The like product issue operates on its own terms as a limit on the injury determination and should not be viewed as a function of injury." See Vermulst and Waer, note 19, above, at p. 285.
42. O.J. 1997 L. 247, p. 1, at recital 47.
43. See Commission Decision of 1 July 1997 terminating the antidumping proceeding concerning imports of certain luggage and travel goods originating in the People's Republic of China, O.J. 1997 L. 174, p. 53 and Commission Decision of 9 June 1997 terminating the antidumping proceeding concerning imports of certain briefcases and schoolbags originating in the People's Republic of China, O.J. 1997 L. 151, p. 44.
44. For example, the above-mentioned cases were based on complaints that were simultaneous and investigated concurrently with the procedure against Handbags from China, the only one of the three that resulted in definitive duties, see Council Regulation No. 1567/97 of 1 August 1997 imposing a definitive antidumping duty on imports of leather handbags originating in the People's Republic of China and terminating the proceeding concerning imports of plastic and textile handbags originating in the People's Republic of China, O.J. 1997 L. 208, p. 31.
45. If physical similarities and end uses are permitted such a decisive role, then one can imagine that Fiat Unos and Rolls Royces could be "like products", because they both have 4-wheels, an engine, etc., and are used for personal transportation. However, in competition-type analysis these two products would never find themselves in the same relevant product market.
46. Commission Regulation No. 1069/97 of 12 June 1997 imposing a provisional antidumping duty on imports of cotton-type bed linen originating in Egypt, India and Pakistan, O.J. 1997 L. 156, p. 11, and Council Regulation (EC) No. 2398/97 of 28 November 1997 imposing a definitive antidumping duty on imports of cotton-type bed linen originating in Egypt, India and Pakistan, O.J. 1997 L. 332, p. 1. Note that Shades of India, inter alia, was granted the "co-operating companies" duty rate of 11.6 percent subsequent to Council Regulation No. 1508/98 of 13 July 1998 amending Regulation 2398/97, O.J. L. 200, 16 June 1998, p. 9.
47. See, for example, EC antidumping rules trap Indian high-quality exports, Financial Times, 3 February 1998.
48. The same is true when the EC institutions treat a country as being "non-market". Then, barring individual treatment for particular companies, all companies bear an average dumping rate.
49. See the provisional regulation in the Handbags from China case, cited above, at recital 20.