Addressing Input Cost Distortions In Dumping Margin Calculations

Investigating authorities in India and globally previously examined input cost distortions as a particular market situation, which renders the domestic selling price unreliable for determination of normal value. As a result, the cost of production of the exporter was adjusted to reflect international prices of inputs. However, pursuant to a challenge, the WTO Panel in Australia – A4 Copy Paper (Indonesia) concluded that domestic selling price can be disregarded only where the particular market situation prevents a proper comparison between the domestic price and export price. Following the decision, the DGTR recently concluded in two investigations that a particular market situation existed in the exporting country, it did not conclude that it prevented proper comparison and thus, did not adjust input costs. Other jurisdictions such as Canada and European Union have amended laws and USA proposes to introduce a provision to address input cost distortions. Similar