Bernard O'Connor on Constructing Normal Value

This is the abstract from a paper by trade lawyer Bernard O'Connor:

Constructing Normal Value in WTO Anti-Dumping Law. Giving meaning to the phrase open, market-oriented policies in the preamble to the Marrakesh Declaration

This paper looks at the construction of normal value in WTO anti-dumping law in relation to market economies (as opposed to non-market economies). The object is to look at two distinct issues: a) when can an investigating authority reject as un-reasonable the costs in the accounts of an exporting producer and b) use costs from a country other than the country of origin of the dumped goods.

The paper is a textual examination of the applicable WTO law. It shows how the idea of open markets permeates the specific provisions on normal value and how ‘openness’ must be the overriding interpretive tool or objective where any uncertainty is to be found in the texts.

The fifth recital of the Marrakesh Declaration sets out the context for the interpretation of Article VI of the GATT and the Agreement on the Implementation of GATT Article VI. This shows that an open market-oriented approach is essential to the understanding of the concept of normal value in WTO law. The concepts of the ordinary course of trade and a particular market situation must be understood in that context.

The paper concludes that, despite the complexities of the texts themselves, as well as the presence of gaps or lacunae in the law, there is an overriding obligation on competent authorities to find a normal value that is open market orientated. And where the costs and prices in the country of origin are not the result of normal open-market forces, recourse to data from outside that country is permissible.