Low prices are not necessarily a sign of dumping. Dumping is defined as selling a product in an export market, for example to the EU, at less than its ‘normal value’. In principle, the normal value is the price of a product when sold on the domestic market of the exporter. In some cases, where domestic prices are unavailable, unreliable or to a significant extent loss making, the normal value can be constructed on the basis of the cost of production including reasonable profit.

If domestic costs and prices in the exporting country are not reliable because of significant distortions in that country, the normal value will also be constructed, but on the basis of costs of production and sale reflecting undistorted prices or benchmarks. Distortions occur when reported prices or costs are not the result of free market forces because they are affected by substantial government intervention.

If the product concerned is exported from a non-market economy, the normal value should be established by reference to prices or costs of production in a comparable market economy, the so-called analogue country.

For details on how to establish the normal value and which countries are considered non-market economies, please consult the ‘Guide for complainants’, which will be available in all EU languages at:

http://trade.ec.europa.eu/doclib/cfm/doclib_results.cfm?docid=112295

In order to establish the export price, invoices, quotes or in certain cases statistical data can be used.

Source: “TDI Trade defence instruments, Anti-dumping & Anti-subsidy - A Guide for Small and Medium-Sized Businesses” by the European Commission