The obligation for members to inform the WTO of anti-dumping measures Dumping is defined in the agreement on the implementation of Article VI of the 1994 GATT (anti-dumping agreement) as the introduction of a product in another country`s trade to a normal value below normal value. In accordance with Article VI of the 1994 GATT and the anti-dumping agreement, WTO members may impose anti-dumping measures in the event of an investigation under the agreement (a) dumping, (b) material damage suffered by the domestic industry that produces the similar product in the importing country and c) a cause-and-effect relationship between the two countries. In addition to the substantive rules for determining dumping, harm and causation, the agreement provides for detailed procedural rules for the initiation and conduct of investigations, the establishment of measures, and the duration and review of measures. 6.1 All parties interested in an anti-dumping investigation will be informed of the information requested by the authorities and will have the opportunity to provide in writing all the evidence they deem relevant to the investigation in question. Industries or businesses may require their government to take protections. The WTO agreement sets out the requirements for protection investigations conducted by national authorities. The emphasis is on transparency and compliance with established rules and practices to avoid arbitrary methods. The investigating authorities must publicly announce the hearing date and make other appropriate evidence available to interested parties. The evidence must contain arguments as to whether a measure is in the public interest. A product is considered “dumped” when exported to another country at a price below the normal price of a similar product in the exporting country. Anti-dumping measures are unilateral remedies (institution of anti-dumping duties on the product concerned) that the government of the importing country can apply after a thorough investigation has established that the product is in fact dumped and that sales of the dumped product cause significant harm to a domestic industry manufacturing a similar product.
Dumping is generally international price discrimination, in which the price of a product sold in the import country is less than the price of that product in the exporting country`s market. Thus, in the simplest cases, dumping is simply identified by comparing prices in two markets. However, the situation is rare, if it is so simple, and in most cases it is necessary to take a series of complex analytical measures to determine the reasonable price in the exporting country`s market (known as normal value) and the reasonable price in the import country market (known as export prices) in order to make a reasonable comparison. The response to dumping and subsidies is often a specific compensatory tax (compensatory tax in the event of a subsidy). This rule is applied to products from certain countries and is therefore contrary to the GATT principles of tariffs and equal treatment between trading partners. The agreements contain a opt-out clause, but both state that the importing country must conduct a thorough investigation before collecting a tariff, properly demonstrating that domestic industry is being harmed.