Commercial Information Circulars

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Ref : EIC 111/3/10/1

22 February 2011

Dear Sirs,

Commercial Information Circular No. 121/2011

US : Valuing the Factor of Production (Labour) in Antidumping Proceedings involving Non-market Economies

The US Department of Commerce (DoC) issued in the Federal Register (FR) of 18 February 2011 a notice to invite public comments on the means by which the DoC can best capture the cost of labour in its wage rate methodology in antidumping (AD) proceedings involving non-market economy (NME) countries. As part of this process, the DoC also invites comments on the interim methodology for determining a surrogate value for wage rates that is currently being applied in AD proceedings for companies in NME countries. Interested parties may submit comments to the DoC no later than 21 March 2011. The FR notice is available at: http://edocket.access.gpo.gov/2011/pdf/2011-3743.pdf.

DETAILS

2.Traders have been informed via Commercial Information Circular No. 389/2010 that, in support of the US President Obama's National Export Initiative (NEI), the DoC has announced a Trade Law Enforcement Package covering 14 proposals to strengthen the administration of the trade remedy laws of the US, including the AD and countervailing duty (CVD) laws. One of the 14 proposals is on "adoption of a new methodology for valuing wage (labour) rates in NME cases by using surrogate wage rates that fully capture all labour costs (including benefits and taxes paid to workers by their employers) in the NME country".

Request for Comments on International Labour Organization Chapter 6A Data

3.Currently, the DoC uses earnings or wage data as reported in "Chapter 5B: Wages in Manufacturing" of the International Labour Organization (ILO) Yearbook of Labour Statistics and prefers "earning" data, when available, since it more accurately reflects the full remuneration received by workers. Due to concerns that reliance on data from Chapter 5B may under-count the NME producer's labour costs, the DoC proposes relying on labour and wage data that include all costs incurred by the producer related to labour including wages, benefits, housing, training, etc. One example of such a data source is "Chapter 6A: Labour Cost in Manufacturing" from the ILO Yearbook of Labour Statistics. The DoC is inviting comments on these methodological issues. Please refer to the FR notice for details.

Request for Comments on Interim Industry-Specific Wage Rate Methodology

4.The DoC's interim methodology for valuing labour in NME AD proceedings utilizes a simple-average industry-specific wage rate calculated with data reported in Chapter 5B of the ILO Yearbook of Labour Statistics. Under this interim methodology currently in use, the DoC calculates an hourly wage rate by averaging industry-specific earnings and/or wages in countries that are economically comparable to the subject country and are significant producers of the comparable merchandise. The calculation steps are detailed in the FR notice. Since implementing this interim methodology, the DoC has encountered a number of methodological and practical challenges. The DoC now invites comments for evaluation of this interim methodology.

ENQUIRIES

5.For enquiries concerning this circular, please contact the undersigned at telephone number 2398 5682.

Yours faithfully,

(Miss Carmen CHAN)

for Director-General of Trade and Industry