4.289 It should be pointed out that the explanatory section of each questionnaire sets out the general and specific instructions for each of the required items, so that the parties could respond properly, in such a way as to enable the implementing authority to use the data supplied by the exporters and importers at the time of the preliminary and definitive determination.

4.290 In addition, the instructions emphasize that �producers and/or exporters from the respondent country must answer this questionnaire with the greatest possible precision, attaching documentation to support its replies, or, if this is impossible, indicating the source of the information�. In other words, in no case was it sufficient to state, for example, for determining the normal value, that a certain number of sales had been made, without backing up that information with a sufficient number of sales invoices for the domestic market. The sample evidence in support of the replies needed to be sufficiently extensive to allow a precise evaluation of the information submitted. Argentina submits that the attached replies did not fulfill the time, quality and quantity requirements that would have enabled the DCD to use them as a basis for reaching a determination. Nevertheless, the DCD took the trouble to consider the information supplied on the basis of the standard of review of the AD Agreement. That standard recognizes the principle of deference to the implementing authority, in the context of anti-dumping investigations, as regards the analysis of the facts and definition of the scope of the obligations of the Agreement (Article 17.6 of the AD Agreement).

4.291 The period originally granted for the submission of the forms and replies to the questionnaires expired on 30 November 1998. In response to the requests for extension sent by the foreign exporting firms and national importers concerned, and in conformity with Article 6.1.1 of the AD Agreement, the DCD granted an additional non-extendable period for all submissions, expiring on 9 December 1998, so that the participating firms could duly complete their respective questionnaires, including sufficient supporting documentation, and appropriate evidence (Notes DCD Nos. 273-000414/98, 273-000429/98 and 273-000430/98 of 19 and 27 November 1998 stated that, in view of the request for an additional period for submission of the questionnaire for foreign producers/exporters, duly completed and with the necessary supporting documentation, �� it has been decided to grant the extension, setting 9 December 1998 as the final deadline for submission ��).

(iii) Qualitative, quantitative and time-related deficiencies in the information submitted

4.292 Article 6.8 of the AD Agreement states as follows:

In cases in which any interested party refuses access to, or otherwise does not provide, necessary information within a reasonable period or significantly impedes the investigation, preliminary and final determinations, affirmative or negative, may be made on the basis of the facts available. The provisions of Annex II shall be observed in the application of this paragraph (emphasis added by Argentina).

4.293 As regards the information supplied in the replies to the questionnaires for producers/exporters, this submission will only highlight the points in which Argentina considers that the producing/exporting companies impeded the investigation, by failing to comply with required formalities in the general and specific instructions of the questionnaires, by not providing the necessary information within a reasonable period, even when granted repeated extensions, by not supplying, with the questionnaires, sufficient supporting documentation (requested for verification purposes), by not providing enough information in the confidential summaries, by not providing any summary in certain cases, and also by the delay and reluctance they displayed in removing the confidentiality of the information supplied, a step which was absolutely necessary to enable the DCD to take account of that information and make it public as an element considered in its decisions.

Replies to the questionnaires

4.294 The four exporting companies making up the sample submitted the following documentation through their representatives on 10 December 1998:

(a) Completed questionnaire for producers/exporters.

(b) Report on procedural deficiencies.

(c) Report on the methodology for selection of the sample.

4.295 The extension granted by the DCD for submitting the forms and replies expired on 9 December 1998. The companies concerned were late in submitting the information, there were a number of formal breaches, and the summaries of the information were insufficient to permit the use of the data supplied, or in some cases were missing altogether.

4.296 As regards the accounting statements submitted by the sample companies, it is important to point out that they were not accompanied by any Spanish translation (except in the case of Marazzi), as required by the general instructions (item 2 of the questionnaire) which refer to the Law on Administrative Procedures No. 19.549, Regulatory Decree No. 1759/72, as harmonized in 1991 by Decree No. 1883/91.

4.297 In this regard the DCD stated, by Notes DCD Nos. 273-000404/99, 273-000405/99, 273-000406/99 and 273-000407/99 of 30 April 1999 to Bismantova, Casalgrande, Caesar and Marazzi (Section 25 of File No. 061-000794/98), that �it is of the utmost importance that all the information and/or documentation presented should be in Spanish or translated into Spanish by a certified translator (Articles 15 and 28, in accordance with the Law on Administrative Procedures No. 19.549, Regulatory Decree No. 1759/72, as harmonized in 1991 by Decree No. 1883/91) in order to be considered in the present proceedings�.

4.298 In the case of information requested by the DCD and submitted by the four representative companies in Annex III � List of importers in Argentina and third countries of the goods under investigation, Annex IV � Information on the producer/exporter market, Annex V � Summary of producer/exporter sales (physical volume) and Annex VI � Summary of producer/exporter sales (estimated volume), the information was presented as confidential, and for reasons of competition, a non-confidential summary was supplied.

4.299 With respect to the said documentation and given the importance of the information supplied, classified as confidential, Argentina considers that the lack of non-confidential summaries �in sufficient detail to permit a reasonable understanding of the substance of the information submitted in confidence� (Article 6.5.1 of the AD Agreement) shows a failure to cooperate in clarifying during the investigation whether there was dumping or not.

4.300 The fact that the DCD considered that the summaries were not sufficiently detailed to permit a reasonable understanding of the substance of the information, in particular, the information corresponding to Annexes V and VI without whose supporting documentation it could not validly be considered for the purposes of reaching a determination of the normal value, is apparent from the repeated requests to provide further supporting documentary evidence and to remove the confidentiality or provide sufficiently detailed non-confidential summaries, as can be seen from the DCD Notes to the four exporting companies concerned on 30 April 1999, 22 June 1999 and 3 August 1999.

4.301 In the particular case of the information presented in Annex VI by Bismantova, the latter supplied the information in Italian lire, adding a note with the exchange rates for the years 1995, 1996 and 1997 and January-October 1998. Here it should be emphasized that point 6 of the specific instructions to the questionnaire clearly states that the table in Annex VI must be in US$. Providing this information in Italian lire shows a lack of cooperation and an effort to impede the investigation, as well as a failure to comply with a formal requirement of the procedure established in respect of the implementing authority.

4.302 Similarly, Bismantova stated that Rondine S.p.A. was its controlling company, holding a 60 per cent share, and that these companies were separate legal entities, with independent accounting records.

4.303 The DCD was thus obliged to handle this information separately in reaching the final determination, in view of the high percentage of unpolished porcellanato sales on the Italian domestic market between related companies. It was therefore necessary for the DCD to separate sales made to the controlling company, Rondine, from those made to the remaining customers on the said market. In particular, folios 27 and 28 of the Final Dumping Determination state that:

In the specific case of the manufacturing export company Ceramica Bismantova S.p.A., it should be stated that the sample documentation supplied with respect to its sales on the Italian market showed a high percentage of transactions involving the sale of unpolished porcellanato in that market between related companies. Thus, approximately 50 per cent of the documentation submitted by the said company involved sales to its controlling company, Rondine S.p.A., from which it in fact buys its inputs for the production of porcellanato. The reply to the questionnaire for exporters originally submitted (Company Structure � File No. 061-10307/98 of 10 December 1998, included in Section XXI, folio 881, sheet 10) reveals that Rondine S.p.A. has a 60 per cent share in Ceramica Bismantova S.p.A.

In accordance with the procedures set forth above, the Directorate of Unfair Competition divided the documentation submitted by Ceramica Bismantova S.p.A. in respect of domestic market sales into those made to its controlling company, Rondine S.p.A., and those made to the remaining customers on the said market, designated as �other customers�.

This procedure revealed that taking the total samples submitted to the Directorate, the share of �other customers� in the sales of unpolished 20 cm x 20 cm porcellanato was 71 per cent, while Rondine S.p.A.�s share was 29 per cent. In the case of 30 cm x 30 cm tiles, the respective shares were 39 per cent and 61 per cent, while in the case of 40 cm x 40 cm tiles, the shares were 7 per cent for �other customers� and 93 per cent for the controlling company Rondine S.p.A.

Moreover, in the specific case of prices relating to transactions with �other customers�, there were price differences of some 13.69 per cent for 20 cm x 20 cm porcellanato tiles, 26.87 per cent for 30 cm x 30 cm tiles and 30.08 per cent in the 40 cm x 40 cm segment. These differences were not justified by the exporting company.

4.304 As regards Annex VII � Actual exports to Argentina, Annex VIII � Sales in the Italian domestic market, Annex IX � Exports to third countries, Annex X � Cost structure of the goods under investigation in the Italian domestic market and Annex XI � Cost structure of the exported goods, the companies supplied the data as confidential information, attaching a brief note regarding its confidential status and citing reasons of competition as justification.

4.305 As reflected in File No. 061-000794/98 incorporated by reference in Resolution 1385/99, the DCD considered that, in the case of the information contained in the above-mentioned Annexes, the grounds given for confidentiality were somewhat thin. Nevertheless, the implementing authority was quite willing to accept the confidentiality, even where the companies had not so much as provided a sufficiently detailed non-confidential summary to permit a reasonable understanding of the substance of the information submitted in confidence, or offered any justification as to why this was not done, ignoring the provisions of Article 6.5.1 of the AD Agreement.

4.306 Notwithstanding the above, the DCD repeatedly requested further supporting documentation, removal of the confidentiality or at least the submission of sufficiently detailed summaries (Notes of 30 April 1999, 22 June 1999 and 3 August 1999). On the one hand, this shows the willingness of the implementing authority to use all the information supplied and, on the other hand, the importance attached to such information, even though the latter proved to be insufficient as supporting documentation.

4.307 In particular, it should be emphasized that Caesar and Marazzi did not submit any information on exports to third countries (Annex IX), nor did the latter submit any information referring to the cost structure of the exported goods (Annex XI). In Argentina�s view, this failure to submit information constitutes at the very least an impediment to the investigation, if not a refusal to provide access to information that is essential in itself.

4.308 Finally, it should be emphasized that, during the evidence-gathering period, none of the exporters offered any evidence, but merely replied to the questionnaire without furnishing sufficient supporting documentation.

Requests to elaborate on the insufficient supporting documentation, to remove the confidentiality or, where appropriate, to provide sufficiently detailed non-confidential summaries

4.309 In its preliminary determination, the DCD stated that the fact that the foreign companies had asked most of the information they supplied to be declared confidential implied differential and restricted treatment in processing that information. The final determination shows that the implementing authority was restricted in its handling of the information, and therefore requested a review of the status of that documentation and the incorporation in the proceedings � during the next stage � of evidence of interest that would enable the Technical Department to present, in its conclusions, the technical and documentary evidence on which they were based from all the firms involved.

4.310 Here it is appropriate to cite Notes DCD Nos. 273-000404/99, 273-000405/99, 273 000406/99 and 273-000407/99 of 30 April 1999 to Bismantova, Casalgrande, Caesar and Marazzi (section 25 of File No. 061 000794/98). In these Notes, the DCD states that it undertook a comprehensive and detailed analysis of all the information submitted by the firms and requested their cooperation in incorporating already requested evidence or adapting information in the record of the proceedings in order to ensure that the DCD had the information it needed to reach a public conclusion with respect to the matter at issue. In this regard it states that, although it is conceivable that for reasons of competition certain items of business information supplied by the companies may have to be safeguarded (hence the requested confidentiality that was accepted by the implementing authority), for the purposes of reaching objective and meaningful conclusions, the DCD had to have information that enabled it to do so. Consequently, it requested that the possibility should be considered of including in the record of the case a more detailed non-confidential summary or of elaborating on the information supplied or, failing this, of allowing the said documentation to be incorporated in the record, removing its confidentiality. This would give the parties concerned and their representatives access to the information in question, remembering that only duly accredited parties would be allowed to consult the information, for the purposes of issuing an opinion.

4.311 The Notes go on to list the documents of particular interest for full incorporation in the record as follows:

- List of importers in Argentina and third countries of the goods under investigation � Annex III;

- Actual exports to Argentina � Annex VII;

- Sales in the Italian domestic market � Annex VIII;

- Exports to third countries � Annex IX;

- Cost structure of the goods under investigation in the Italian domestic market � Annex X;

- Cost structure of the exported goods � Annex XI.

4.312 By File No. 061-004097/99 of 14 May 1999, included as folio 1315 in the record of the case, and in response to DCD�s requests in the Notes mentioned above, the representatives of the Italian firms requested an extension of the time-limit for the submission of the required information. In Note DCD No. 273-000617/99 of 19 May 1999, the DCD states that �� the implementing authority has decided to grant an extension up to 7 June 1999�.

4.313 By File No. 061-004809/99 of 4 June 1999, the representative of Assopiastrelle, Bismantova, Casalgrande, Marazzi and Cesar wrote to the DCD listing the information submitted and stating that, for each of the Annexes corresponding to each of the exporting firms included in the sample, there was a corresponding confidential Annex containing �conversion tables� so that the implementing authority could analyse the information. In other words, information was submitted from the four Italian firms of both a public and a confidential nature, separated into different Annexes.

4.314 By File No. 061-004860/99 of 7 June 1999, the representatives of Bismantova further submitted, as confidential information, Annex IC bis containing copies of sales invoices relating to the Italian domestic market.

4.315 On expiry of the extension on 10 June 1999, by File No. 061-005002/99 of 10 June 1999, the representatives of the Italian exporting firm Casalgrande further submitted, as confidential information, Annex IIC bis containing copies of sales invoices relating to the Italian domestic market.

4.316 Once again the Italian firms alleged that the confidentiality of all this information was based on strict reasons of competition. Once again, without responding to the DCD�s concerns regarding the lack of supporting documentation, when they added a further sample thereof to the record, they asked for it to be treated as confidential information without providing non-confidential summaries �in sufficient detail to permit a reasonable understanding of the substance of the information submitted �� (Article 6.5.1 of the AD Agreement).

4.317 Consequently, by means of Note No. 273-000768/99 of 22 June 1999, the DCD had to repeat the need for further supporting documentation, since what it had was insufficient:

� The DCD repeats the statement made on other occasions concerning the need for information that would enable the implementing authority to reach public conclusions in its technical reports. To that end, and to enable the DCD to make a precise comparison in its report on the final determination of the margin of dumping, the companies Ceramica Bismantova S.p.A., Ceramica Casalgrande Padana S.p.A., Marazzi Ceramiche S.p.A. and Ceramiche Caesar S.p.A are therefore asked to remove the confidentiality requirement for the information concerning the product code so that the said information can be incorporated in the record of the proceedings, or to submit a sufficiently detailed non-confidential summary of the information. This requirement must be met within five days after the receipt of this note �

4.318 As stated during the proceeding in question, the submission of information and documentation for which confidential treatment is requested constitutes a limiting factor with respect to the analysis and public conclusions of the implementing authority.

4.319 Hence, the DCD sought, during the investigation, to obtain elements that were not subject to that condition so that it could make proper estimates with respect to the product under investigation. The removal of the confidentiality of the product code would enable the goods to be categorized according to their dimensions. In other words, without the product code it was very difficult to make out which product the information submitted applied to.

4.320 By File No. 061-005427/99 of 24 June 1999, the Italian firms, through their representatives, stated that they would remove the confidentiality of the product code item.

4.321 Moreover, by Note DCD No. 273-000890/99 of 3 August 1999, the DCD informed the representative of Assopiastrelle, Bismantova, Casalgrande, Marazzi and Caesar that �� the implementing authority is currently engaged, at this final stage of the investigation, in the analysis of all the information in the record of the case in order to arrive at a final determination in these proceedings. To do so, it must take into account all the information in these proceedings, and considers that it is important to ask you to remove the confidentiality of the information concerning production costs of the product at issue, or to prepare a non-confidential summary that would enable the information to be processed. Given the time-limit for the final determination, we would be grateful if this request could be met within five days following the receipt of this communication ��.

Particular quantitative aspects of the sample

4.322 It is important to emphasize that the sample documentation relating to sales on the Italian domestic market supplied by all of the manufacturing export companies concerned in the case � major representatives of the porcellanato production market � in conformity with the supplied sample methodology, covers no more than approximately 1.92 per cent of the physical volume (m2) and 1.35 per cent of the total estimated value (Italian lire) of sales in the domestic market according to the information duly supplied.

4.323 Argentina would like to stress that the DCD accepted without reservation the sample methodology presented by Assopiastrelle (i.e. the four exporting companies Bismantova, Marazzi, Caesar and Casalgrande) because the association itself said that this would facilitate the work of the investigators. As is apparent from the record of the case, the alleged facilitation of the work did not materialize in practice in view of the lack of sufficiently detailed non-confidential summaries, the absence of such summaries in cases where the information was absolutely necessary, the delay in removing the confidentiality and the limited supply of supporting documentation.

4.324 The Italian companies concerned had to be requested by the DCD to expand on the inadequate supporting documentation (Notes of 30 April, 22 June and 3 August 1999), and even after it had been supplied, it continued to be meaningless for the purposes of an objective valuation.

4.325 Finally, the implementing authority pointed out the shortcomings in the accompanying documentation, as well as the impact of those shortcomings on the investigation. The statements by the DCD in the Notes mentioned above correspond exactly, in the authority�s view, to the situation described in Article 6.8 of the AD Agreement. That is to say, this is a situation where the investigation was significantly impeded since the DCD was obliged to continue requesting additional evidence, what it had being insufficient. As a result of the repeated requests for supporting documentary evidence, the DCD was obliged to grant repeated extensions to facilitate the pursuit of the investigation, which was impeded by the attitude of the exporters. The combination of these elements placed the authority in a situation in which it did not have the necessary information because the exporting firms were refusing access to that information.

4.326 Argentina presented then its legal arguments concerning the EC�s claim under Article 6.8 of the AD Agreement.

4.327 The EC asserts, in paragraph 48 of its first written submission, that none of the three circumstances required by Article 6.8 to make a determination on the basis of the facts available was present in this case.

(iv) Significant impeding of the investigation

4.328 Argentina submits that the exporters did significantly impede the investigation in that they failed to carry out the formalities required in the general and specific instructions accompanying the questionnaires. Nor did they provide sufficient supporting documentation with the information supplied, and the DCD had to request further evidence. Finally, the scant information provided in the confidential summaries also represented a significant impediment to the investigation, particularly as regards information needed to determine the normal value and the export value, where no direct summary was provided at all.

(v) Refusal of access to necessary information

4.329 At the same time, the fact that the DCD accepted, without reservations, the �sample methodology� proposed by Assopiastrelle because the association itself said that this would facilitate the work of the investigators shows that the implementing authority was favourably disposed to consider such information as that party might submit.

4.330 Having accepted this sample methodology, the DCD discovered, upon examining the supporting documentation, supplied belatedly at the specific request of the authority, that it only covered approximately 1.92 per cent of the physical volume (m2) and 1.35 per cent of the total estimated value (Italian lire) of domestic market sales, based on the information previously received.

4.331 Much of the information supplied by the companies was confidential. This information included data concerning total volumes and amounts of sales in the Italian domestic market by the participating firms. The firms also subsequently provided information concerning some of their sales transactions which enabled the implementing authority to establish average values in accordance with the above-mentioned method. However, it was felt that certain considerations should be highlighted with respect to the supporting sample. Its representativeness was mentioned as a factor to be taken into account, given that the percentages were fairly insignificant in comparison to the total for the period analysed.

4.332 This falls within the scope of Article 6.8 of the AD Agreement as significantly impeding the investigation by refusing access to necessary information.

(vi) Failure to provide the information within a reasonable period

4.333 With respect to the requirement to provide necessary information within a reasonable period, Argentina submits that the repeated requests for extensions together with the delay in removing the confidentiality of the information and the unwillingness to do so even though absolutely necessary for the DCD to be able to take it into account, in fact reflect the situation described in Article 6.8 in which the party does not provide necessary information within a reasonable period.

Continuation: Section 4.334

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