Since 1997. China has conducted anti-dumping and countervailing duty investigations. Yet, it was not until nearly three decades later that the Ministry of Commerce of the People’s Republic of China (“MOFCOM”) initiated its first anti-circumvention investigation, a probe concerning anti-dumping measures in force on non-dispersion-shifted single-mode optical fibers originating in the United States. In this investigation, MOFCOM found that U.S. optical fiber manufacturers and exporters had altered their trade patterns by rerouting exports of the relevant optical fiber products into China without sufficient commercial justification. This conduct, MOFCOM determined, undermined the effectiveness of the foregoing anti-dumping measures and therefore constituted circumvention of such anti-dumping measures.[1]

China currently lacks a dedicated legal framework governing anti-circumvention proceedings under trade remedy investigations. In mid-2025, however, MOFCOM took a step toward in addressing this gap by publishing the Draft Rules on Anti-Circumvention Investigations under Trade Remedy Measures (the “Draft Rules”) for public comment. Drawing on both the Draft Rules and the ruling in the optical fiber anti-circumvention case, this article offers a preliminary analysis of the statutory factors MOFCOM considers in anti-circumvention investigations, along with the investigative methodologies adopted therein. Building on this analysis, this article further examines how the optical fiber anti-circumvention ruling applies in the context of China’s “product scope adjustment procedure” (scope ruling) under its broader trade remedy regime.

I. Core Framework of Legal Elements for Finding Circumvention

In deciding whether circumvention had occurred, MOFCOM applied a three-part test: (1) a change in trade patterns; (2) the commercial justification for such change; and (3) the resulting impairment of the trade remedy measures. This test aligns closely with the factors set out in Article 10 of the Draft Rules. Article 10 provides that, when determining whether circumvention exists, the investigating authority should consider, among other things: (i) changes to products or trade patterns before the initiation of a trade remedy investigation or after the imposition of trade remedy measures; (ii) whether such changes are supported by sufficient commercial justification; and (iii) any impairment to the effectiveness of the applicable trade remedy measures. MOFCOM’s reasoning in the optical fiber determination followed this analytical structure.

Throughout the investigation, MOFCOM employed standard investigative tools, including questionnaires, public hearings, and on-site verifications, while safeguarding the procedural rights of interested parties, including extended deadlines for responses and opportunities to submit written comments. These procedural mechanisms mirror those routinely applied in China’s anti-dumping investigations.

II. Changes in Trade Patterns

(A) Statutory Basis

Article 10(1) of the Draft Rules explicitly requires the investigating authority to examine “changes to products or trade patterns occurring before the initiation of a trade remedy investigation or after the imposition of trade remedy measures.” Article 4 further identifies specific forms of circumvention, of which two are particularly relevant here: subparagraph (5) “exporting products to China following minor modifications to the goods,” and subparagraph (6) “other conduct altering products or trade patterns for export to China.” Article 9 of the Draft Rules also makes clear that whether the tariff classification of the slightly modified product matches that of the original subject product has no bearing on the circumvention analysis. Tariff classification is therefore not determinative.

(B) Factual Findings and Analytical Reasoning

MOFCOM’s finding of altered trade patterns rested on three mutually reinforcing considerations: technical overlap between the subject products, market interchangeability, and comparative analysis of import and export volume data.

First, MOFCOM found substantial technical overlap between the subject products. The G.654.C optical fibers under the investigation and the ULL G.652 optical fibers subject to the existing anti-dumping measures were both ultra-low-loss optical fibers with substantially identical characteristics[2]. Specifically, a single ultra-low-loss product manufactured by U.S. optical fiber producers can simultaneously satisfy both ITU-T G.654.C and G.652 technical standards, meaning the product may be classified under either specification. The investigating authority pointed to specific product models from U.S. Manufacturer A demonstrating this overlap: where a product’s cutoff wavelength is capped at 1260 nm, the product satisfies both standards. Marketing materials from U.S. Manufacturer B likewise showed that its relevant product lines met both technical benchmarks. In addition, the two product categories utilize essentially identical raw materials and production processes, with substantial overlap in core product specifications and primary technical metrics.

Second, MOFCOM considered market recognition and interchangeability. Despite some differences in individual technical indicators, MOFCOM found the two optical fiber lines highly interchangeable in end-uses, with extensive overlap in intended applications, sales channels, and customer bases, particularly in critical ultra-low-loss applications such as extra-high voltage and ultra-high-voltage power transmission lines and telecommunications carrier backbone networks, as well as long-distance transmission generally. The investigating authority emphasized that downstream purchasers evaluate optical fibers mainly by attenuation coefficients, dispersion characteristics, cutoff wavelengths, and similar core metrics. Given the substantial overlap in such key specifications, downstream buyers treat both varieties as ultra-low-loss optical fibers with no material functional distinction.[3]

Third, MOFCOM identified an inverse correlation in import and export volume trends of the two product categories. MOFCOM disclosed indexed export data for 2015 through 2024, presented as an index to protect confidential business information, which demonstrated a structural shift in trade patterns following the imposition of anti-dumping duties. In 2015, export volumes of the subject product accounted for less than 3% of exports of ULL G.652 optical fibers. Thereafter, imports of the subject product increased sharply, reaching nearly 75 times the 2015 level by 2024. The increase accelerated after the anti-dumping duty rates were raised in the administrative review completed in 2018: exports of the subject product nearly doubled in 2019 compared with 2018, and by 2024 stood at 293 times the 2018 level. By contrast, ULL G.652 optical fibers export volumes doubled in 2019 but then declined year-over-year to near-negligible levels. Based on this record, MOFCOM concluded that, following the imposition of anti-dumping measures, U.S. optical fiber manufacturers and exporters shifted from selling ULL G.652 optical fibers to selling the investigated G.654.C fibers while serving the same pool of Chinese customers engaged in communications and power cable manufacturing. MOFCOM found that this shift constituted a material change in established trade patterns.[4]

III. Commercial Reasonableness of Changed Trade Patterns

(A) Statutory Basis

Article 10(2) of the Draft Rules establishes “whether the foregoing changes are supported by sufficient commercial justification” as an independent factor for the investigating authority to weigh. This element matters because not every product or trade shift following the imposition of trade remedy measures amounts to circumvention. A legitimate market adjustment must be distinguished from conduct designed to undermine the remedial effect of existing measures. In MOFCOM’s optical fiber determination, the commercial justification analysis focused on objective market evidence, including shifts in end-user demand, technological development, and cost-benefit economic analysis.

(B) Factual Findings and Analytical Reasoning

The investigating authority assessed the commercial justification for the shift from both the demand side and the supply side.

On the demand side, traditional applications for the product under investigation were limited. Evidence submitted by the domestic petitioner indicated that G.654.C optical fibers had historically been deployed primarily at submarine-to-terrestrial connection points, with negligible aggregate demand: since 2018, only about 3,500 core kilometers had been used in a small number of individual engineering projects. While U.S. Manufacturer A asserted the product under investigation was also suitable for submarine communications infrastructure, it failed to submit any supporting documentation or evidence demonstrating material demand growth for that application after the existing anti-dumping measures were imposed. On-site verification confirmed that the product under investigation could also be deployed in quantum communications projects, but in extremely small quantities; furthermore, aggregate demand for submarine telecommunications applications utilizing the product under investigation remained static after anti-dumping measures took effect[5].

On the supply side, the contrast was stark. While traditional applications of the product under investigation showed limited and stable demand, demand grew substantially in application scenarios in which the product under investigation and ULL G.652 optical fibers were highly substitutable. This growth was driven mainly by the fact that China’s national telecommunications carrier backbone networks generated robust consumption of ULL G.652 optical fibers between 2018 and 2024, with domestic utilization expanding nearly fivefold from 100,000 core kilometers to 580,000 core kilometers. Over the same period, imports of the product under investigation increased significantly.

Taken together, the record showed that demand for the investigated product had grown only in the end-use markets fully interchangeable with ULL G.652 fibers, while demand for its distinct submarine applications was unchanged. No interested party offered a reasonable commercial explanation for the shift in trade patterns by U.S. producers and exporters, and MOFCOM identified no plausible commercial rationale for the shift other than intent to circumvent the existing anti-dumping measures. Accordingly, MOFCOM found that the material shift in trade patterns lacked sufficient commercial justification, given the absence of any material change in the customer base, primary end-use applications, or core technical specifications required for relevant projects.

IV. Impairment to the Effectiveness of Existing Anti-Dumping Measures

(A) Statutory Basis

Article 2 of the Draft Rules identifies conduct that “undermines the effectiveness of applicable trade remedy measures” as a core element of circumvention. Article 14 requires a petitioner to file evidence showing how the trade remedy measures have been affected.

(B) Factual Findings and Analytical Reasoning

MOFCOM examined the impairment of the existing anti-dumping measures by considering both price effects and profit effects.

First, MOFCOM found sustained price erosion. Since 2015, imports of U.S.-origin products subject to the existing anti-dumping measures had declined substantially, while imports of the U.S.-origin product under investigation had increased rapidly, with prices had fallen sharply. Transaction data confirmed that sales prices for the product under investigation declined continuously from 2020 onward, falling by 23% in 2024 compared with 2020.[6]This price trend demonstrated that U.S. exporters maintained market access into China at lower prices by switching product specifications and changing their trade pattern.

Second, MOFCOM considered the deterioration of the domestic industry’s profitability. Over the same timeframe, the petitioner’s per-unit gross profit margins for ULL G.652 optical fibers fell by 90%. This sharp decline provided direct evidence that the domestic industry continued to face adverse competitive pressure from the product under investigation, notwithstanding the existing anti-dumping measures.

Third, MOFCOM found a causal link between the changed trade pattern and the impairment of the anti-dumping measures’ effectiveness. The purpose of the anti-dumping duties was to eliminate material injury to the domestic industry caused by dumped imports of ULL G.652 optical fibers from the United States. By redirecting export volumes through G.654.C optical fibers, U.S. exporters preserved their foothold in the Chinese market, thereby preventing the domestic industry from obtaining the remedial relief intended by the anti-dumping measures.

V. Product Scope Adjustment Procedures and Anti-Circumvention Investigations

The optical fiber anti-circumvention case also raises important questions regarding the relationship between product scope clarification and anti-circumvention review. U.S. Manufacturer A argued that its ULL G.652.B optical fiber should be excluded from the existing anti-dumping measures because their attenuation value at the 1550 nm window was below the lower bound of the "typical loss values" stated in the product description. The investigating authority did not accept this argument, explaining that the product scope of the existing anti-dumping measures was defined by an integrated description, encompassing the product name, specific product description, and the product’s main uses, that was to be read as a whole, rather than by any single parameter in isolation. The "typical loss values" set out a representative range of parameters for G.652 optical fibers, not an absolute exclusionary threshold. Accordingly, a product whose parameters fall outside that indicative range may still fall within the scope of the measures if it retains the essential characteristics of the subject product.

This holding illustrates a critical overlap between post-imposition product scope adjustment procedures and anti-circumvention investigations.

(A) Overview of the Product Scope Adjustment Procedure

China’s product scope adjustment procedure functions analogously to scope ruling mechanisms in other jurisdictions. MOFCOM’s Interim Rules on Procedures for Adjusting Anti-Dumping Product Scopes establish the dedicated procedural framework governing modifications to product definitions both during anti-dumping investigations and in the subsequent administration of measures, serving as a primary statutory vehicle through which interested parties may challenge a contested product scope classification.

The product scope delineated in anti-dumping initiation notice determines the scope of evidence to be submitted during the investigation, while the product scope set out in preliminary and final determinations has binding effect on customs duty collection. In certain scenarios, a product scope adjustment procedure may also capture classic anti-circumvention fact patterns—such as goods modified through minor technical alterations, or exports redirected through trade pattern manipulations—by expanding the scope of products subject to anti-dumping duties via formal scope clarification.

The statutory threshold for a product scope adjustment procedure turns on two questions: whether the contested product falls within the formal descriptive definition of the product under investigation, or whether exclusion of such product would preclude a proper assessment of injury to the domestic industry in the underlying trade remedy investigation.

(B) Applicability of the Optical Fiber Circumvention Facts to Product Scope Adjustment Proceedings

MOFCOM confirmed that the investigated G.654.C optical fibers and duty-covered ULL G.652 optical fibers share essentially identical raw material inputs and manufacturing processes, with substantial overlap in core product characteristics and technical metrics.[7]This factual record suggests that the technical specifications of G.654.C optical fibers may also satisfy the product description on the existing anti-dumping measures. In theory, a product scope adjustment procedure could have achieved a similar result by confirming that G.654.C optical fibers fall within the product scope of the existing anti-dumping measures.

Notably, U.S. Manufacturer A’s challenge regarding its G.652.B optical fiber—namely, that the attenuation value at the 1550 nm window was below the lower bound of the “typical loss values” stated in the scope language—is a classic product scope issue. That type of argument turns on the interpretation of the scope language itself and is therefore naturally suited to a product scope adjustment procedure.

(C) Distinctions Between Anti-Circumvention Investigations and Product Scope Adjustment Proceedings

Anti-circumvention investigations center on material alterations to products or trade patterns and evaluating resulting impairment to trade remedy effectiveness. By contrast, product scope adjustment procedures are limited to determining whether a certain product conforms to the formal written definition of the subject product, with no statutory mandate to assess erosion of remedy effectiveness.

Where a new product variant has technical specifications that are identical or substantially overlapping with those of the original subject product, both procedures may provide a route for resolving the product scope issue. However, the two mechanisms diverge sharply when addressing newly developed products or third-country assembled products whose technical specifications do not align with the formal subject product definition set forth in anti-dumping determination. In such circumstances, a product scope adjustment procedure may be inadequate. Anti-circumvention investigations, by contrast, can examine altered trade patterns and impaired remedy effectiveness, and may provide a basis for extending the application of the measures to prevent circumvention.

(D) Divergent Litigation and Evidentiary Strategies for Responding to Each Investigation

Because the two procedures serve different purposes and apply different analytical tests, cross-border enterprises should adopt different strategies and evidentiary preparations when responding to a Chinese anti-circumvention investigation as opposed to a product scope adjustment proceeding.

In anti-circumvention investigations, the defense should focus on the alleged alteration in trade patterns, the timing of that alternation in relation to the initiation or imposition of trade remedy measures, and whether the effectiveness of the measures has in fact been impaired. Evidentiary submissions should prioritize documentation establishing the commercial reasonableness of any change in trade patterns and rebutting any alleged harm to the effectiveness of the underlying anti-dumping measures.

In a product scope adjustment proceeding, by contrast, the central issue is the relationship between the disputed product and the governing product description set out in the initiation notice and the determinations imposing the measures. From the perspective of a multinational company respondent, the evidentiary focus should be on technical, functional, and descriptive differences between the disputed product and the products covered by the trade remedy measures.

VI. Conclusion

The optical fiber anti-circumvention investigation represents China's first anti-circumvention case and therefore has landmark significance. MOFCOM's determination illustrates the analytical path the investigating authority is likely to follow in future cases, and it gives cross-border respondents a precedent reference for framing their arguments and marshalling their evidence.

The product scope adjustment procedure operates as an alternative procedural avenue for parties that wish to contest the boundaries of products covered by trade remedy measures. Where the issue turns on the interpretation of the product description, this procedure may enable interested parties to seek clarification of, or a narrowing of, the product scope and, where successful, obtain an exemption from anti-dumping or anti-subsidy duties.

[Note] 

[1] The anti-circumvention measures were suspended two months after they took effect.

[2] Ruling in Anti-Circumvention Investigation into Optical Fiber Products Imported from the U.S., Page 9.

[3] Ibid, page 10.

[4] Ibid, page 11.

[5] Ibid.

[6] Ibid, page 13.

[7] Ibid, page 9.