PROTOCOL AMENDING THE TREATY ESTABLISHING
(Protocol VIII: Competition Policy, Consumer Protection, Dumping and
Types of Subsidies Causing Serious Adverse Effects
Member States shall not ordinarily impose or introduce countervailing duties or take countermeasures on products which benefit from:
(a) subsidies which are not specific within the meaning of Article 30(p)(bis); or
(b) subsidies which are specific within the meaning of Article 30(p)(bis) but which satisfy all of the conditions set out in this sub-paragraph hereunder:
(i) subsidies which are not specific, in terms of the granting authority or the enabling legislation it applies -
(a) not explicitly limiting access to such subsidies by certain enterprises;
(b) establishing objective criteria or conditions governing the eligibility for and the amount of, a subsidy where eligibility is automatic and such criteria and conditions
are strictly adhered to; or
(c) not limiting a subsidy programme or its predominant or disproportionate use to certain enterprises;
(ii) subsidies granted for research activities conducted by enterprises or by higher education or research establishments on a contract basis with firms if:
the assistance covers not more than 75 per cent of the costs of industrial research or 50 per cent of the costs of pre-competitive development activity;
and provided that such assistance is limited exclusively to:
(a) costs of personnel (researchers, technicians and other supporting staff employed exclusively in the research activity);
(b) costs of instruments, equipment, land and buildings used exclusively and permanently (except when disposed of on a commercial basis) for the research activity;
(iii) subsidies granted to assist disadvantaged regions within the territory of a Member State given pursuant to a general framework of regional development and
non-specific within eligible regions provided that:
(a) each disadvantaged region must be a clearly designated contiguous
geographical area with a definable economic and administrative identify;
(b) the region is considered as disadvantaged on the basis of neutral and objective criteria, indicating that the region's difficulties arise out of more than temporary
circumstances; such criteria must be clearly spelled out in law, regulation, or other official document, so as to be capable of verification;
(c) the criteria shall include a measurement of economic development which shall be based on at least one of the following factors:
(i) one of either income per capita or household income per capita, or GDP per capita, which must not be above 85 per cent of the average for the territory
(ii) unemployment rate, which must be at least 110 per cent of the average for the territory concerned;
(iv) subsidies granted to assist entities in the adaptation of existing facilities to new environmental requirements imposed by law and/or regulations which result in
greater constraints and financial burden on enterprises provided that the subsidies -
(a) are a one-time non-recurring measure; and
(b) are limited to 20 per cent of the cost of adaptation; and
(c) do not cover the cost of replacing and operating the assisted investment, which must be fully borne by firms; and
(d) are directly linked to and proportionate to a firm's planned reduction of nuisances and pollution, and does not cover any manufacturing cost savings which may be
(e) are available to all firms which can adopt the new equipment and/or production processes.
(v) subsidies granted to assist enterprises to undertake training or retraining of employees, whether or not the enterprise is new, and the upgrading of existing facilities
to facilitate transition to competitive status within the Community, provided that such subsidies are not specific.
2. Member States shall notify the COTED of any subsidy mentioned in paragraph 1. Any Member State may request further information regarding a notified subsidy
programme and the COTED shall review annually all notified subsidies referred to in paragraph 1.
Preliminary Investigation of Subsidies
Causing Serious Adverse Effects
1. A domestic industry may submit to the competent authority an application for an investigation to verify that serious adverse effects have been caused by imports
which benefit from subsidies referred to in Article 30(z).
2. Upon receipt of an application for an investigation to verify adverse effects, the authority shall examine the application, and, on the basis of the available facts,
determine whether to initiate an investigation.
3. The investigation referred to in paragraph 2 shall be deemed a preliminary investigation. The authority shall give public notice of its decision to initiate a preliminary
investigation and the concerned Member State, other interested Member States, and the interested parties shall all be invited to provide relevant information and
4. The results of the preliminary investigation shall be made available to the concerned Member State, other interested Member States and the interested parties to
enable them to defend their interests
Request for Consultations Relating to Subsidies
Causing Serious Adverse Effects
1. Whenever a Member State has reason to believe that imports from another Member State benefitted from subsidies within the meaning of Article 30(z) and such
imports have resulted in serious adverse effects to a domestic industry so as to cause damage which would be difficult to repair, the Member State aggrieved may
request consultations with the Member State granting or maintaining the subsidy.
2. The Member State alleged to be granting the subsidy which caused adverse effects shall reply within 10 days of the date of the request for consultations and shall
enter into the consultations requested by the aggrieved Member State. If there is no mutual agreement within 60 days of the date of the request for such consultations
or on a later date which was mutually agreed or if the Member State refuses to cooperate, the aggrieved Member State may refer the matter to the COTED and
request the COTED to carry out an investigation.
Investigation by COTED of Subsidies
Causing Serious Adverse Effects
1. The referral of the matter to the COTED for an investigation shall not prevent the aggrieved Member State from imposing on a provisional basis, which shall not
be sooner than 60 days from the date of initiation of the preliminary investigation referred to in Article 30(aa), countermeasures to forestall or prevent further adverse
2. If the COTED is satisfied that the investigation requested is justified, the COTED shall carry out the investigation, make a determination and issue a report within
120 days from the date when the request was referred.
3. Where the results of the investigation carried out by the COTED demonstrated that the subsidised imports caused serious adverse effects to the domestic industry
of the aggrieved Member State requesting the investigation, the COTED shall recommend that the offending Member State modify the programme of subsidies in
such a way as to remove the adverse effects complained of.
Consequences of Failure to Eliminate or
Establish Adverse Effects of Subsidies
1. If the offending Member State fails to implement the recommendations of the COTED within 6 months of the date of issue of the report referred to in paragraph 2
of Article 30(cc), the COTED shall authorise the aggrieved Member State to impose appropriate countervailing duties commensurate with the nature and degree of
serious adverse effects determined to exist.
2. Whenever the results of an investigation by COTED prove that serious adverse effects have not been caused by subsidised imports referred to in paragraph 1 of
Article 30(z), the Member State alleging that its domestic industry has suffered serious adverse effects shall promptly refund any duties which might have been
provisionally imposed and where such provisional duties had materially retarded the exports of the Member State complained against, the COTED shall, upon
application from such State, assess the effects of the provisionally applied duties and determine the nature and extent of compensation which is warranted and require
compensation in accordance with its assessment.
Imposition of Provisional Measures
and Countervailing Duties
1. Notwithstanding anything to the contrary in this Protocol, a Member State aggrieved by the application or maintenance of prohibited subsidies or by subsidies
which cause injury, or result in nullification, impairment, or serious prejudice, or cause serious adverse effects, as the case may be, shall introduce provisional
measures only on the basis of the following rules:
(a) Provisional measures may be applied only if -
(i) a preliminary investigation has been initiated in accordance with the provisions of this Protocol, a public notice has been given to that effect and interested parties
have been given adequate opportunities to submit information and make comments;
(ii) an affirmative preliminary determination has been made of the existence of a prohibited subsidy, or a subsidy causing injury, nullification, impairment, serious
prejudice, or a subsidy causing serious adverse effects, as the case may be;
(iii) consultations were requested and/or undertaken, the COTED was notified and requested to investigate and the authorities concerned judge such measures
necessary to prevent injury being caused during the investigation;
(b) Provisional measures may take the form of provisional countervailing duties guaranteed by cash deposits or bond equal to the amount of the provisionally
calculated amount of subsidisation;
(c) Provisional measures shall not be applied sooner than 60 days from the date of initiation of the preliminary investigation;
(d) The application of provisional measures shall be limited to as short a period as possible, not exceeding 120 days.
2. Where investigations by the COTED continue beyond the period allowed for the maintenance of provisional measures under sub-paragraph 1(d), the Member
State imposing the measures may continue with such measures until a definitive determination is made by the COTED.
3. The Member States which are parties to an investigation to verify the existence and the effect of alleged subsidisation, may seek or accept, as the case may be,
undertakings from the Member State alleged to have granted or to be maintaining a subsidy. Undertakings may take the form of:
(a) withdrawal, or limiting the amount of, the subsidy to such an extent that injury, nullification, impairment, serious prejudice or serious adverse effects, as the case
may be, are eliminated; or
(b) a guarantee from the exporter benefitting from the subsidy to raise his price to such an extent that the injurious effect is eliminated.
4. If a Member State accepts a voluntary guarantee pursuant to sub-paragraph 3(b), then the accepting Member State shall notify the COTED and promptly
suspend proceedings, and any provisional measures which may have been imposed shall be withdrawn with immediate effect.
5. In the event that investigations to determine subsidisation have been concluded and the evidence proves injury, nullification, impairment or serious prejudice, or
serious adverse effects, as the case may be, a Member State may impose countervailing duties retroactively to account for the entire period during which provisional
measures have been in force. Such retroactively applied duties shall take into account the definitively assessed countervailing duties and the amount guaranteed by
cash deposit or bond and:
(a) where the definitive countervailing duties are higher than the provisional duties, the difference shall not be collected;
(b) where the definitive countervailing duties are lower than the provisional duties, the excess of the deposit shall be refunded or the bond released promptly.
6. No Member State shall impose countervailing duties other than provisional countervailing duties without prior authorisation from the COTED and the
determination and imposition of definitive countervailing duties shall be governed by the relevant provisions of the World Trade Organisation (WTO) Agreement on
Subsidies and Countervailing Measures.
7. The COTED shall keep under review all counter-measures imposed by Member States and shall ensure that Member States observe the conditions and timetable
for review and withdrawal of counter-measures that it may have authorised.
8. Member States undertake to co-operate in establishing harmonised legislation and procedures in accordance with the provisions of this Protocol.
Action Against Dumping
A Member State may take action against dumped imports if such imports cause injury or pose a serious threat of injury to a domestic industry.
Determination of Dumping
1. For the purposes of this Protocol, a product is to be considered to be dumped, that is to say, introduced into the commerce of another country at less than its
normal value if the export price of the product exported from one Member state to another Member State is less than the comparable price, in the ordinary course of
trade, for the like product when destined for consumption in the exporting Member State.
2. When there are no sales of the like product in the ordinary course of trade in the domestic market of the exporting country or when, because of the particular
market situation or the low volume of the sales in the domestic market of the exporting country, such sales do not permit a proper comparison, the margin of
dumping shall be determined by comparison with a comparable price of the like product when exported to an appropriate third country, provided that this price is
representative, or with the cost of production in the country of origin plus a reasonable amount for administrative, selling and general costs and for profits.
3. In cases where there is no export price or where it appears to the authorities concerned that the export price is unreliable because of association or a
compensatory arrangement between the exporter and importer or a third party, the export price may be constructed on the basis of the price at which the imported
products are first resold to an independent buyer, or if the products are not resold to an independent buyer, or not resold in the condition as imported, on such
reasonable basis as the authorities may determine.
4. A fair comparison shall be made between the export price and the normal value. This comparison shall be made at the same level of trade, normally at the
ex-factory level, and in respect of sales made at as nearly as possible the same time. Due allowance shall be made in each case, on its merits, for differences which
affect price comparability, including differences in conditions and terms of sale, taxation, levels of trade, quantities, physical characteristics, and any other differences
which are also demonstrated to affect price comparability.
In the cases referred to in paragraph 3, allowances for costs, including duties and taxes incurred between
importation and resale, and for profits accruing, should also be made. If in these cases price comparability has been affected, the authorities shall establish the normal
value at a level of trade equivalent to the level of trade of the constructed export price, or shall make due allowance as warranted under this paragraph. The
authorities shall indicate to the parties in question what information is necessary to ensure a fair comparison and shall not impose an unreasonable burden of proof on
5. In the case where products are not imported directly from the country of origin but are exported to the importing Member from an intermediate country, the price
at which the products are sold from the country of export to the importing Member shall normally be compared with the comparable price in the country of export.
However, comparison may be made with the price in the country of origin, if, for example, the products are merely transshipped through the country of export, or
such products are not produced in the country of export, or there is no comparable price for them in the country of export.
6. For the purpose of this Protocol "like product" shall be interpreted to mean a product which is identical, i.e., alike in all respects to the product under
consideration, or in the absence of such a product, another product, which, although not alike in all respects, has characteristics closely resembling those of the
product under consideration.
Determination of Injury
1. For the purpose of Article 30(ff), injury shall, unless otherwise specified, be taken to mean material injury to a domestic industry, threat of material injury to a
domestic industry or material retardation of the establishment of such an industry.
2. A determination of injury within the meaning of paragraph l shall be based on positive evidence and involve an objective examination of:
(a) the volume of the dumped imports and the effect of such imports on prices in the domestic market for like products; and
(b) the consequent impact of the dumped imports on domestic producers of such products.
3. In making a determination regarding the existence of a threat of material injury, the competent authorities shall consider, inter
(a) significant rate of increase of dumped imports into the domestic market indicating the likelihood of substantially increased importation;
(b) sufficient freely disposable, or an imminent, substantial increase in, capacity of the exporter indicating the likelihood of substantially increased dumped exports to
the importing Member's market taking into account the availability of other export markets to absorb any additional exports;
(c) whether imports are entering at prices that will have a significant depressing or suppressing effect on domestic prices, and would likely increase demand for
further imports; and
(d) inventories of the product being investigated.
Definition of Domestic Industry
1. For the purposes of this Protocol, the term "domestic industry" shall mean "domestic industry" as defined in
Initiation of Preliminary Investigations
1. If a domestic industry in a Member State has reason to believe that it is being injured or faces the threat of injury as a result of dumped imports, an application
may be submitted in writing by the industry or on its behalf by an association representing the industry or by employees employed by the producers of the like
product to the competent authority to initiate an investigation in order to verify the existence of dumped imports and injury caused or the existence of a serious threat
of injury as the case may be.
2. The application shall be considered to have been made by or on behalf of the domestic industry if it is supported by those domestic producers whose collective
output constitutes more than 50 per cent of the total production of the like product produced by that portion of the domestic industry expressing either support for or
opposition to the request. However, no investigation shall be initiated when domestic producers expressly supporting the request account for less than 25 per cent of
total production of the like product produced by the domestic industry.
3. The authority shall examine the application and determine if an investigation is justified and if it is satisfied, it shall issue a public notice to that effect and request the
concerned Member State, other interested Member States and the interested parties, all of whom may be requested to and shall be afforded an opportunity to
provide required information and comments.
4. A decision by the authority to initiate an investigation shall be considered a decision to initiate a preliminary investigation, the results of which shall be made
available by a public notice.
5. Where a preliminary investigation provides sufficient evidence that dumped imports have entered into the commerce of the Member State and such imports
seriously threaten or have injured a domestic industry, it may submit to the competent authority of the exporting Member State a request for consultations which
shall be notified to the COTED.
6. The purpose of the request for consultations shall be to establish whether imports have been dumped and injury has been caused or there is a serious threat of
injury and if the injury or the serious threat thereof is directly the result of dumped imports.
7. Interested parties who have been requested to provide information shall be allowed 30 days from the date of submission of the application by or on behalf of a
domestic industry under paragraph 2 to reply unless the authorities concerned agree to a later date.
8. For the purpose of this Protocol, "interested parties" shall include:
(a) an exporter or foreign producer or the importer of a product subject to investigation, or a trade or business association, a majority of the members of which are
producers, exporters or importers of such product;
(b) the government of the exporting Member State; and
(c) a producer of the like product in the importing Member State or a trade and business association, a majority of the members of which produce the like product
in the territory of the importing Member State.
9. A request for investigations to be undertaken by the competent authority of a Member State or by the COTED shall include but shall not necessarily be limited to
the information indicated in the Illustrative List attached to this Protocol as
Annex III(b). If, however, an aggrieved Member State is satisfied that the offending party
had not made satisfactory efforts to afford consultations, to provide requested information or otherwise unreasonably impede an investigation which has been initiated, the competent authority of the Member State aggrieved may impose on a provisional basis anti-dumping measures and may refer the request for investigation to the
COTED. A public notice of the imposition of provisional anti-dumping measures shall be issued by the Member State which has imposed such measures.
1. Provisional measures may be applied only if -
(a) an investigation has been initiated in accordance with the provisions of paragraph 4 of Article 30(jj), a public notice has been given to that effect and interested
parties have been given adequate opportunities to submit information and make comments;
(b) a preliminary affirmative determination has been made of dumping and consequent injury to a domestic industry; and
(c) the authorities concerned judge such measures necessary to prevent injury being caused during the investigation.
2. Provisional measures may take the form of a provisional duty or preferably, a security - by cash deposit or bond - equal to the amount of the anti-dumping duty
provisionally estimated, being not greater than the provisionally estimated margin of dumping. Withholding of appraisement is an appropriate provisional measure,
provided that the normal duty and the estimated amount of the anti-dumping duty be indicated and as long as the withholding of appraisement is subject to the same
conditions as other provisional measures.
3. Provisional measures shall not be applied sooner than 60 days from the date of initiation of the investigation by a competent authority.
4. The application of provisional measures shall be limited to as short a period as possible, not exceeding 120 days or, on decision of the authorities concerned, upon
request by exporters representing a significant percentage of the trade involved, to a period not exceeding 180 days. When authorities, in the course of an
investigation, examine whether a duty lower than the margin of dumping would be sufficient to remove injury, these periods may be 180 and 270 days, respectively.
Conduct of Investigations leading to
Definitive Determination of Injury
1. Whenever the COTED receives a request for investigation, referred to it under paragraph 9 of Article 30(jj), the COTED shall determine whether the information
accompanying the request justifies the continuation of investigations and if it is satisfied, cause an investigation to be completed within 12 months but not longer than
18 months after the date of receipt of the request. If the COTED is not satisfied that there is sufficient justification to initiate an investigation, it shall inform the
applicant in writing of its refusal to investigate.
2. Investigations either initiated by a competent authority of a Member State or undertaken by the COTED shall be terminated promptly whenever:
(a) the margin of dumping is determined to be less than two per cent; and
(b) the volume of dumped imports from a particular country is less than three per cent of imports of the like product in the importing Member State, unless
which individually account for less than three per cent of the imports of the like product into the importing Member State collectively account for more than seven per
cent of the imports of the like product in the importing Member State, and a public notice of the termination of investigations under this paragraph shall be made by the Member State terminating investigations or by the COTED, as the
case may be.
3. Member States recognise that an investigation into the circumstances of alleged dumping based on a request by another Member State on behalf of a domestic
industry will require the full co-operation of the competent authority and the parties alleged to be responsible for dumped imports, in the Member State from which
such imports originated; all of whom shall provide relevant information in the time specified in this Article.
4. In the conduct of an investigation to determine the existence and effect of dumped imports, competent authorities of Member States and the parties concerned
shall observe the rights of the parties providing information with regard to confidentiality of any information provided and shall not disclose any such information
without the prior written approval of the parties providing the information.
5. Where an industry within the Single Market and Economy has suffered injury or faces the threat of serious injury based on evidence of dumped imports by third
States, the competent authority for requesting investigation on behalf of the affected industry shall be the COTED.
6. Nothing in this Article shall be construed so as to prevent an injured party or a Member State from initiating and proceeding with an investigation into alleged
dumping having regard to the rights of such parties under international agreements to which they are signatories.
Co-operation by Competent Authorities
and Interested Parties
1. Where an applicant for an investigation who receives information pursuant to dumping investigations requires verification of the information, the competent
authority and the parties alleged to be responsible for dumped imports shall co-operate in allowing the applicant to carry out verifications in the offending Member
2. The results of any investigations carried out by a competent authority of a Member State aggrieved or by the COTED shall be disclosed promptly to the
competent authority and the parties alleged to be responsible for dumped imports in the offending Member State. A public notice of the conclusions of the
investigations shall be issued by the Member State or by the COTED, as the case may be.
3. The purpose of the disclosure referred to in paragraph 2 shall be to present the facts of the case and to allow the parties alleged to be responsible for the dumped
imports to defend their interests.
Continue on to Article 30 (nn)