The importance of preparing thoroughly for the verification cannot be overemphasized. The first step in the preparations is to anticipate the need for verification at the same time that the response is being prepared, so that the company staff save and organize the important information. Advance planning when preparing the response can save enormous amounts of time later when preparing for the verification.

The second step is to review carefully the verification outline. The Commerce Department usually issues an outline of the verification topics at least a week prior to the verification.

This verification outline may specify certain transactions and items about which the Commerce Department wants very detailed information. This information must be prepared in advance. Unfortunately, the outlines prepared by the Commerce Department are often very brief and do not provide much guidance to a company deciding what to prepare for the verification. The lawyer representing the foreign company usually has to prepare the company for the verification based on his or her past experience in similar verifications.

The third step is to prepare some materials in advance, based on the verification outline and the lawyer's experience. A company need not prepare detailed information about every transaction and every piece of information in the response. Samples showing the methodology used and the types of accounting records available to substantiate the information should be prepared for each category of information, however. The number of examples necessary depends on the nature and importance of the item. Adjustments that are the same for both United States price and foreign market value - and thus have little effect on the net dumping margin - usually receive less scrutiny than adjustments based on large home market expenses. The advance preparation should reflect the relative importance of the various topics.

The fourth step is to anticipate possible follow-up questions by the Commerce Department staff, and prepare the necessary materials. Since the Commerce Department usually selects additional examples to check during the verification, the company needs to have the other documentation readily available. For example, the company prepares a detailed packet for one month, and the Commerce Department then asks for the same information for another month randomly selected during the verification. The documents needed to meet such requests should be readily available.

The last step is to solve the logistical problems of the verification. It is helpful to have a copier available for exclusive use during the verification. Because of the number of documents that need to be available, companies often reserve several large conference rooms for the entire period of the verification. One of the rooms can be used as the site of the verification. The other rooms can be used for storing additional documents and for private meetings between the company staff and the lawyers during the verification.

The amount of time necessary for these preparations varies depending on the circumstances of the case. A simple case involving only an investigation of prices at a company with a well-organized accounting system could be adequately prepared in as few as three or four days. A complex case involving both price and cost investigations could take as long as two or three weeks to prepare adequately. Other factors that affect the amount of time needed. include the number of corporate entities involved in the investigation, the complexity of the issues, and the amount of time the Commerce Department expects to spend at the verification. Most typically, the Commerce Department allows one week to conduct a price verification and another week if the verification also involves cost.

Source: Business Guide to Trade Remedies in the United States: Anti-dumping, countervailing and safeguards legislation practices and procedures