INTRODUCTION
- ANTI DUMPING – MEANING AND CONCEPT
What is anti dumping?
Does dumping
mean cheap or low priced imports ?
Is anti dumping a measure of protection for domestic industry?
What is the difference between anti dumping duty and Normal Customs duty?
What are the parameters used to assess dumping of goods from a country?
How do you define?
What are the essential requisites for initiating an anti dumping
investigation?
What are the parameters of injury to the domestic industry?
What is the Non-injurious Price and injury margin? How these are worked out?
How is causal link established between dumping and injury to the domestic
industry?
In case anti dumping duty is warranted after the investigation?
What is the minimum level of imports (de-minimis margins) from a country?
What is the relief/remedy to the Domestic Industry under the Anti Dumping
mechanism.?
What are other remedial measures against unfair trade practices in addition
to Anti Dumping?
What is the legal framework for Anti Dumping, Anti Subsidy and safeguard
measures?
-
ANTI-DUMPING PROCEDURE
What is the institutional arrangement in India for anti dumping?
Who can make an application for initiation of Anti Dumping investigation and
imposition of AD duty?
Who are the interested parties to an anti dumping investigation?
Who all can appear in Anti-dumping cases to represent the parties?
What are the essential conditions for initiation of Anti Dumping
investigation?
Can the Designated Authority initiate Anti Dumping cases in respect of items
suo-motu, i.e. on its own?
What is the information required to be submitted by the Domestic Industry
for Anti Dumping proceedings?
What is the period to which the information will relate?
What are the various stages of the investigation process?
Are the interested parties to the investigation given sufficient opportunity
to represent their case before the Authority?
Can there be interim relief to the domestic industry pending levy of final
anti dumping duty?
Can the anti dumping duty be levied on a retrospective basis ?
Who
imposes the Anti Dumping duty, provisional or final?
What are the implications for the importers who are liable to pay
anti-dumping duty if?
What is the arrangement made to notify the recommendations of the Designated
Authority?
Is the order of determination of anti-dumping duty appealable? If so, which
is the appellate Authority?
Can the Anti-Dumping investigation, once initiated, be terminated? If so,
what are the circumstances?
Aren’t the Anti Dumping measures injurious to the interests of the
consumers?
What is the period of validity of the Anti Dumping duty imposed?
Does the levy of Anti Dumping duty on a particular product extend to all
imports of that product?
Can the Anti-Dumping and Anti-Subsidy measures be applied simultaneously?
-
MISCELLANEOUS MATTERS
What is the significance of anti dumping measures in India in the context of
lifting of QR?
There are number of cases in which anti dumping duty is imposed on imports
of goods from China.?
INTRODUCTION
Under the existing WTO arrangement, and in terms of various
provisions under the Customs Tariff Act of 1975 (as amended in 1995) and Rules
framed thereunder, anti-dumping and allied measures constitute the legal
framework, within which the domestic industry can seek necessary relief and
protection against dumping of goods and articles by exporting companies and
firms of any country from any part of the world. These measures have assumed a
great deal of relevance in India in recent times in view of the scenario arising
out of unfair trade practices adopted by some of our trading partners,
especially in the post-QR phase.
The Anti-Dumping and allied measures are complex legal disciplines which are
often not within the easy comprehension of the trade and industry who are the
users of these measures. To obviate this difficulty faced by large sections of
the domestic industry, there is a need to explain the basic concepts, legal
provisions and procedural aspects in clear and easy language for their benefit.
This will facilitate the domestic industry to avail of these remedial measures
in the wake of alleged dumping and of injury caused by unfair trade practices.
However, it is always necessary to bear in mind that the anti-dumping action can
never be an action based on presumption and vague complaints and only on very
rare occasions suo-moto proceedings can be initiated. The requisite parameters
of law have to be duly complied with and need to be fully supported and
substantiated with facts and figures before any action could be initiated.
I am particularly grateful to my esteemed colleagues in the Anti-Dumping
Division in the Ministry – S/Shri R. Gopalan, Joint Secretary, Siddharth,
Director, Y.K. Venkatesh, Ved Prakash, Neeraj Varshney, Smt.Aditi Das Rout,
Rajiv Arora, Rajeev Jain, S.K. Jaiswal, Mukesh Bhatnagar, M.K. Anand and Brijesh
Sikka, who took painful efforts to make this Q-A Booklet comprehensive in all
respects. My sincere thanks are due to Shri S.K. Samal, Jt. Director General of
Foreign Trade, who was with the AD set up in the Ministry till January, 2001,
before he moved to Ministry of Agriculture, for preparing the first draft and
organizing the subjects in sequential order. Shri K.Sundar, PS, extended
valuable help to the team of officers in preparing the computer script and
finalizing the same for the final publication.
It is our earnest hope that all the Industry Associations and individual
companies interested in AD supportive measures will find this booklet useful.
They are always welcome to come forward with their suggestions and seek further
clarifications based on which this booklet work he revised as and when
necessary.
Sd /-
(L.V. SAPTHARISHI)
Additional Secretary and Designated Authority
Anti-Dumping Investigation
I. ANTI DUMPING – MEANING AND CONCEPT
Q. 1. What is anti dumping? What is its purpose in
International Trade?
Ans. Dumping is said to occur when the goods are exported by a country
to another country at a price lower than its normal value. This is an unfair
trade practice which can have a distortive effect on international trade. Anti
dumping is a measure to rectify the situation arising out of the dumping of
goods and its trade distortive effect. Thus, the purpose of anti dumping duty is
to rectify the trade distortive effect of dumping and re-establish fair trade.
The use of anti dumping measure as an instrument of fair competition is
permitted by the WTO. In fact, anti dumping is an instrument for ensuring fair
trade and is not a measure of protection per se for the domestic industry. It
provides relief to the domestic industry against the injury caused by dumping.
Q.2. Does dumping mean cheap or low priced imports ?
Ans. Often, dumping is mistaken and simplified to mean cheap or low priced
imports. However, it is a misunderstanding of the term. On the other hand,
dumping, in its legal sense, means export of goods by a country to another
country at a price lower than its normal value. Thus, dumping implies low priced
imports only in the relative sense (relative to the normal value), and not in
absolute sense.
Import of cheap products through illegal trade channels like smuggling do not
fall within the purview of anti-dumping measures.
Q.3. Is anti dumping a measure of protection for domestic industry?
Ans. Anti dumping, in common parlance, is understood as a measure of protection
for domestic industry. However, anti dumping measures do not provide protection
per se to the domestic industry. It only serves the purpose of providing remedy
to the domestic industry against the injury caused by the unfair trade practice
of dumping. In fact, anti dumping is a trade remedial measure to counteract the
trade distortion caused by dumping and the consequential injury to the domestic
industry. Only in this sense, it can be seen as a protective measure. It can
never be regarded as a protectionist measure.
Q.4. What is the difference between anti dumping duty and Normal Customs
duty? Is the anti dumping duty over and above the Normal Customs duty chargeable
on the import of an item?
Ans. Although anti dumping duty is levied and collected by the Customs
Authorities, it is entirely different from the Customs duties not only in
concept and substance, but also in purpose and operation. The following are the
main differences between the two: -
- Conceptually, anti dumping and the like measures in their essence are
linked to the notion of fair trade. The object of these duties is to guard
against the situation arising out of unfair trade practices while customs
duties are there as a means of raising revenue and for overall development
of the economy.
- Customs duties fall in the realm of trade and fiscal policies of the
Government while anti dumping and anti subsidy measures are there as trade
remedial measures.
- The object of anti dumping and allied duties is to offset the injurious
effect of international price discrimination while customs duties have
implications for the government revenue and for overall development of the
economy.
- Anti dumping duties are not necessarily in the nature of a tax measure
inasmuch as the Authority is empowered to suspend these duties in case of an
exporter offering a price undertaking. Thus such measures are not always in
the form of duties/tax.
- Anti dumping and anti subsidy duties are levied against exporter /
country inasmuch as they are country specific and exporter specific as
against the customs duties which are general and universally applicable to
all imports irrespective of the country of origin and the exporter.
Thus, there are basic conceptual and operational differences between the
customs duty and the anti dumping duty. The anti dumping duty is levied over and
above the normal customs duty chargeable on the import of goods in question.
Q.5. What are the parameters used to assess dumping of goods from a
country?
Ans. Dumping means export of goods by one country / territory to the
market of another country / territory at a price lower than the normal value. If
the export price is lower than the normal value, it constitutes dumping. Thus,
there are two fundamental parameters used for determination of dumping, namely,
the normal value and the export price. Both these elements have to be compared
at the same level of trade, generally at ex-factory level, for assessment of
dumping.
Q. 6. How do you define:
- Normal Value
- Export price and
- dumping margin
Ans. A. Normal Value: Normal value is the comparable price at which the goods
under complaint are sold, in the ordinary course of trade, in the domestic
market of the exporting country.
If the normal value can not be determined by means of the domestic sales, the
following two alternative methods may be employed to determine the normal value:
-
- Comparable representative export price to an appropriate third country.
- Constructed normal value, i.e. the cost of production in the country of
origin with reasonable addition for administrative, selling and general
costs and reasonable profits.
B. Export price: The Export price of the goods allegedly dumped into India
means the price at which it is exported to India. It is generally the CIF value
minus the adjustments on account of ocean freight, insurance, commission, etc.
so as to arrive at the value at ex-factory level.
- A. Dumping Margin: The margin of dumping is the
difference between the Normal value and the export price of the goods under
complaint. It is generally expressed as a percentage of the export price.
Illustration: Normal value US$ 110 per kg.
Export price US$ 100 per kg.
There is dumping in this case as export price is lower than normal value and
dumping margin in this case is US$ 10 per kg., i.e. 10% of the export price.
Dumping is a function of two variables, namely Normal Value and Export Price,
which must be compared at the same level of trade i.e. at the ex-factory level.
Q.7. What are the essential requisites for initiating an anti dumping
investigation?
Ans. The following are essential for initiating an anti dumping investigation: -
- Sufficient evidence to the effect that ;
- there is dumping
- there is injury to the domestic industry; and
- there is a causal link between the dumping and
the injury, that is to say, that the dumped imports have caused the
alleged injury.
- The domestic producers expressly supporting the anti
dumping application must account for not less than 25% of the total
production of the like article by the domestic industry.
The application is deemed to have been made by or on behalf of the domestic
industry, if it is supported by those domestic producers whose collective
output constitute more than 50% of the total production of the like article
produced by that portion of the domestic industry expressing either support
for or opposition as the case may be, to the application.
Note:
This is to further clarify that a domestic industry, which seeks relief,
should give sufficient evidence with respect to the above parameters. Unless
the above parameters are satisfied, it will not be possible for the
Authority to initiate an anti-dumping investigation.
Q. 8. What are the parameters of injury to the domestic industry?
Ans. Broadly, injury may be analysed in terms of the volume effect and
price effect of the dumped imports. The parameters by which injury to the
domestic industry is to be assessed in the anti dumping proceedings are such
economic indicators having a bearing upon the state of industry as the magnitude
of dumping, and the decline in sales, selling price, profits, market share,
production, utilisation of capacity etc.
Q.9. What is the Non-injurious Price and injury margin? How these are
worked out?
Ans. Non-Injurious Price (NIP) is that level of price, which the
industry is, expected to have charged under normal circumstances in the Indian
market during the Period defined. This price would have enabled reasonable
recovery of cost of production and profit after nullifying adverse impact of
those factors of production which could have adversely effected the company and
for which dumped imports can’t be held responsible.
Besides the calculation of the margin of dumping, the Designated Authority also
calculates the Injury Margin for the Domestic Industry. The Injury Margin is the
difference between the Non-Injurious Price due to the Domestic Industry and the
Landed Value of the dumped imports.
Landed Value for this purpose is taken as the assessable value under the Customs
Act and the applicable basic Customs duties except CVD, SAD and special duties.
For calculating Non-Injurious Price, the Authority calls for costing information
from the domestic industry in the prescribed proforma for the period of
investigations and for three previous years. Accounting records maintained on
the basis of Generally Acceptable Accounting Principle (GAAP) form the basis for
estimating Non-Injurious Price. In the estimation of Non-Injurious Price for the
Domestic Industry, the Authority makes appropriate analysis of all relevant
factors like usage of raw material, usage of utilities, captive consumption etc.
and the actual expanses during the Period of Investigation including the
investments, the capacity utilisation etc. The Non-Injurious Price for Domestic
Industry is determined considering the reasonable return on the capital employed
Q.10. How is causal link established between dumping and injury to the
domestic industry?
Ans. In the anti dumping proceedings, it is imperative to prove that the dumping
has caused injury to the domestic industry. No anti dumping duty shall be
recommended without a finding of this causal relationship. That is to say,
DUMPING should lead to INJURY
The causal link is to be established generally in terms of the following effects
of dumped imports on domestic industry: -
- volume effect
- price effect
The volume effect of dumping relates to the market share of the domestic
industry vis-à-vis the dumped imports from the subject country/ies while with
regard to the price effect, the Designated Authority shall consider whether
there has been a significant price under cutting by the dumped imports as
compared with the price of the like product in India, or whether the effect of
such imports is otherwise to depress prices to a significant degree or prevent
price increase which otherwise would have occurred to a significant degree.
Q.11. In case anti dumping duty is warranted after the investigation,
what is the extent of such duty to be recommended/imposed?
Ans. Under the WTO arrangement, the National Authorities can impose
duties upto the margin of dumping i.e. the difference between the normal value
and the export price. The Indian law also provides that the anti dumping duty to
be recommended/levied shall not exceed the dumping margin.
Q.12. What is the minimum level of imports (de-minimis margins) from a
country and from an individual exporter below which such exporter or country is
to be excluded from the scope of Anti Dumping investigation/duties?
Ans. Individual exporter: Any exporter
whose margin of dumping is less than 2% of the export price shall be excluded
from the purview of anti-dumping duties even if the existence of dumping, injury
as well as the causal link is established.
Country: Further, investigation against any country
is required to be terminated if the volume of the dumped imports, actual or
potential, from a particular country accounts for less than 3% of the total
imports of the like product.
However, in such a case, the cumulative imports of the like product from all
these countries who individually account for less than 3%, should not exceed 7%
of the import of the like product.
Q.13What is the relief/remedy to the Domestic Industry under the Anti
Dumping mechanism. Is it always in the form of Anti-dumping duty?
Ans. The relief to the domestic industry against dumping of goods from
a particular country is in the form of anti dumping duty imposed against that
country/ies, which could go upto the dumping margin. Such duties are exporter
specific and country specific.
However, the remedy against dumping is not always in the form of anti dumping
duty. The Authority may terminate or suspend investigation after the preliminary
findings if the exporter concerned furnished an undertaking to revise his price
to remove the dumping or the injurious effect of dumping as the case may be. No
anti dumping duty is recommended on such exporters from whom price undertaking
has been accepted. H
Q.14 What are other remedial measures against unfair trade practices in
addition to Anti Dumping? How do they come into operation?
Ans. Apart from dumping, some of the countries also resort to
subsidisation of their exports to other countries. Export subsidies, under the
WTO agreement, are treated as unfair trade practice and such subsidies are
actionable by way of levy of anti-subsidy countervailing duty.
There is one more trade remedial measure called "safeguards" which are applied
as an emergency measure in response to surge in imports of a particular item.
- Anti subsidy countervailing measure is in the form of countervailing
duty which is to be imposed only after the determination that:
- the subsidy is a specific subsidy
- the subsidy relates to export performance;
- the subsidy relates to the use of domestic goods
over imported goods in the export article; or
- the subsidy has been conferred on a limited number
of persons engaged in manufacturing, producing or exporting the article.
What is subsidy for this purpose?
A subsidy is said to exist;
- if there is a financial contribution by the Government
or any public body within the territory of the exporting country, i.e.
where-
- there is a direct transfer of funds(including
grants, loans and equity) by the Government;
- government revenue i.e. otherwise due is
foregone and not collected(including fiscal incentives, I.T. exemption
- a government provides goods or services other than
general infrastructure;
- a government grants or maintains any form of income or
price support which operates directly or indirectly to increase export of
any article from its territory.
What is not a subsidy?
- However the subsidy which is for research activities conducted by the
persons engaged in manufacture or export or the subsidy which is for
assistance to disadvantaged regions with the territory of the exporting
country is not actionable. Thus, no countervailing duty is to be levied on
such subsidies.
- In anti subsidy countervailing investigation, the Government of the
exporting country/ies is a party to the investigation in addition to the
exporters from these countries. The countervailing duty imposed on the
subsidised exports from a country shall not exceed the amount of such
subsidy/ies.
- In India the Designated Authority for anti dumping is also the Authority
for administering anti subsidy countervailing measures.
What it Safeguards?
- Safeguards, on the other hand, are applied when :
- there is a surge in imports of a particular product
irrespective of a particular country/ies and,
- it causes serious injury to the domestic industry.
- Safeguard measures are applied to all imports of the product in question
irrespective of the countries in which it originates or from which it is
exported. This aspect distinguishes Safeguards from anti dumping and anti
subsidy measures which are always country specific and exporter specific.
- Safeguards are applied in the form of either safeguard duty or in the
form of safeguard QRs (import licenses). These measures are administered in
India by an Authority called Director General (Safeguards) who functions in
the jurisdiction of the Department of Revenue, Ministry of Finance.
Q.15 What is the legal framework for Anti Dumping, Anti Subsidy and
safeguard measures?
Ans. Sections 9, 9 A, 9 B and 9 C of the Customs Tariff Act, 1975 as amended in
1995 and the Customs Tariff (Identification, Assessment and Collection of
Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules,
1995 and Customs Tariff(Identification, Assessment and Collection of
Countervailing Duty on Subsidised Articles and for Determination of Injury)
Rules, 1995 framed thereunder form the legal basis for anti-dumping and anti
subsidy investigations and for the levy of anti-dumping and countervailing
duties. These laws are in consonance with the WTO Agreements on Anti Dumping and
Anti Subsidy countervailing measures.
II. ANTI-DUMPING PROCEDURE
Q. 1 What is the institutional arrangement in India for anti
dumping, anti-subsidy and safeguard action against unfair trade practices?
Ans: Anti dumping and anti subsidies & countervailing measures in India are
administered by the Directorate General of Anti dumping and Allied Duties (DGAD)
functioning in the Dept. of Commerce in the Ministry of Commerce and Industry
and the same is headed by the "Designated Authority". The Designated Authority’s
function, however, is only to conduct the anti dumping/anti subsidy &
countervailing duty investigation and make recommendation to the Government for
imposition of anti dumping or anti subsidy measures. Such duty is finally
imposed/levied by a Notification of the Ministry of Finance. Thus, while the
Department of Commerce recommends the Anti-dumping duty, it is the Ministry of
Finance, which levies such duty.
Safeguard measures, on the other hand, are administered by another Authority
namely, Director General (Safeguard), which functions under the Dept. of
Revenue, Ministry of Finance. The Standing Board of Safeguards (chaired by the
Commerce Secretary) considers the recommendations of the DG (Safeguards) and
then recommends the impositions of the Safeguard Duty as it deems fit, to the
Ministry of Finance which levies the duty.
Q. 2 Who can make an application for initiation of Anti Dumping investigation
and imposition of AD duty?
Ans: Applications can be made by or on behalf of the concerned domestic industry
to the Designated Authority in the Dept. of Commerce for an investigation into
alleged dumping of a product into India. Under the Rules a valid application can
be made only by those petitioners/domestic producers who expressly support the
application, and account for more than 25% of total domestic production of the
like article in question.
` The application is deemed to have been made by or on behalf of the domestic
industry, if it is supported by those domestic producers whose collective output
constitutes more than fifty percent of the total production of the like article
produced by that portion of the domestic industry expressing either support for
or opposition as the case may be, to the application.
However, such producers may exclude those who are related to the exporters or
importers of the alleged dumped article or are themselves importers thereof. In
other words, a domestic producer who is related to the exporter or importer of
the dumped article or is himself an importer thereof, may not be treated as part
of the domestic industry even if he files or supports an anti-dumping petition.
Q.3 Who are the interested parties to an anti dumping investigation?
Ans. The interested parties to an anti dumping investigation include:
- the domestic industry on whose complaint the proceedings are initiated;
- The exporters or the foreign producers of the like articles subject to
investigation;
- The importers of the same article allegedly dumped into India;
- The Government of the exporting country/ countries.
- The trade or business associations of the domestic producers/importers/user
industries of the dumped product.
Q.4 Who all can appear in Anti-dumping cases to represent the parties?
Ans. Any representative duly authorised by the petitioner/ interested parties/
Association etc. can appear in the Anti-dumping cases to represent the concerned
parties.
Q.5 What are the essential conditions for initiation of Anti Dumping
investigation?
Ans. The Designated Authority shall not initiate an anti-dumping investigation
unless it receives a well-documented application/petition, which should help it
determine:
- that the domestic producers/petitioners filing the petition and/or expressly
supporting the petition account for at least 25% of total domestic production of
the like article in question.
` The application is deemed to have been made by or on behalf of the domestic
industry, if it is supported by those domestic producers whose collective output
constitutes more than fifty percent of the total production of the like article
produced by that portion of the domestic industry expressing either support for
or opposition as the case may be, to the application; and
- that there is sufficient evidence furnished by the petitioner/s regarding;
- Dumping of goods in question;
- Injury to the domestic industry; and
- A causal link between the dumped imports and alleged injury to the domestic
industry.
Q.6 Can the Designated Authority initiate Anti Dumping cases in
respect of items suo-motu, i.e. on its own, without a petition filed by the
aggrieved party ?
Ans. Normally speaking, the Designated Authority initiates the proceedings for
anti dumping action on the basis of a petition received from the domestic
industry alleging dumping of certain goods and the injury caused to it by such
dumping. However, Rule 5(4) of the Anti Dumping Rules provides for suo-motu
initiation of anti dumping proceedings by the Designated Authority on the basis
of information received from the Collector of Customs appointed under the
Customs Act, 1962 or from any other source. In such circumstances, the Authority
initiates the anti dumping investigation on its own without any
complaint/petition filed in this regard, provided the Authority is satisfied
that sufficient evidence exists as to the existence of dumping, injury and
causal link between the dumped imports and the alleged injury. It is further
clarified that after initiation, the suo-motu investigation follows the same
procedure as the one based on a petition as mentioned in the Anti Dumping Rules.
Q.7 What is the information required to be submitted by the Domestic Industry
for Anti Dumping proceedings?
Ans. An application for investigation into any alleged dumping filed by the
aggrieved domestic industry must contain sufficient evidence (like Bill of
Entry, Invoices, letter from the Indian Mission in the subject country/ies, data
from secondary sources like specialized commodity journals etc.) as to the
existence of dumping in relation to the goods imported from the subject country/ies
and the fact that such dumped imports are causing or threatening to cause
material injury to the Indian Industry producing the like goods or are
materially retarding the establishment of an industry.
Further, the information relating to the standing of the petitioner/s as
domestic industry (Please see the answer to Q.2) must be contained in the anti
dumping application.
The application containing the requisite information for the proceedings must be
made in the prescribed format devised by the Directorate General of Anti Dumping
and Allied Duties and available in the said Directorate. Guidelines for filling
in the application proforma and for completing the prescribed questionnaire are
formulated and incorporated in a user-friendly manner in the application
proforma itself.
Q.8 What is the period to which the information will relate; that is to say what
is Period of Investigation in anti-dumping cases?
Ans. All the information and evidence furnished in the application in relation
to dumping, injury and causal link must pertain to a definite period which is
called the period of investigation. Broadly, there are indications that such
period should not be, in any case, less than six months and not more than
eighteen months. It is, however, important that the period taken into
consideration for detailed investigation into dumping and injury should be as
representative and as recent as possible. The most desirable period of
investigation is a financial year provided there is reasonable proximity between
the end of the financial year and the filing of the application.
However, for the purposes of injury analysis, the domestic industry has to
furnish the relevant data for the past three years.
Q.9 What are the various stages of the investigation process?
Ans. An Application received by the Designated Authority is dealt with in the
following manner:
- Preliminary Screening:
The application is scrutinized to ensure that it is fully documented and
provides sufficient evidence for initiating an investigation. If the
evidence is not adequate, then a deficiency letter is issued. Unless the
deficiencies are rectified, the submission made before the Authority can not
be construed as an application pending before the Authority .
- Initiation:
Designated Authority determines that the application has been made by
or on behalf of the Domestic Industry. It also examines the accuracy and
adequacy of the evidence provided in the application and when satisfied that
there is sufficient evidence regarding dumping, injury and causal link, a
public notice is issued initiating an investigation.
The Initiation notice will be issued normally within 5 days from the date of
receipt of a properly documented application.
- Access to Information:
The Authority provides access to the non-confidential evidence
presented to it by various interested parties in the form of a public file,
which is available for inspection to all interested parties on request after
receipt of the responses.
- Preliminary Findings:
The Designated Authority will proceed expeditiously with the conduct
of the investigation and shall, in appropriate cases, make a preliminary
finding containing the detailed information on the main reasons behind the
determination. The preliminary finding will normally be made within 60-70
days from the date of initiation.
- Provisional Duty:
A provisional duty not exceeding the margin of dumping may be imposed
by the Central Government on the basis of the preliminary finding recorded
by the Designated Authority.
The provisional duty can be imposed only after the expiry of 60 days from
the date of initiation of investigation.
The provisional duty will remain in force only for a period not exceeding 6
months, extendable to 9 months under certain circumstances.
- Oral Evidence & Public Hearing:
Interested parties who participate in the investigations can request
the Designated Authority for an opportunity to present the relevant
information orally. However, such oral information shall be taken into
consideration only when it is subsequently reproduced in writing. The
Authority may grant oral hearing anytime during the course of the
investigation.
Besides the above, the Authority holds a public hearing inviting all
interested parties to make their submissions before it. All oral submissions
made during the hearing need to be reproduced in writing for the Authority
to take the same on board.
- Disclosure of information:
Based on these submissions and evidence gathered during the
investigation and verification thereof, the Authority will determine the
basis of its final findings. However, the Designated Authority will inform
all interested parties of the essential facts, which form the basis for its
decision before the final finding is made.
- Final Determination:
The interested parties submit their response to the disclosure and
the final position of the Authority taken therein. The Authority examines
these final submissions of the parties and comes out with final findings.
- Time-limit for Investigation
Process
Normal time allowed by the statute for conclusion of investigation
and submission of final findings is one year from the date of initiation of
the investigation. The above period may be extended by the Central
Government by 6 months.
Q.10 Are the interested parties to the investigation given sufficient
opportunity to represent their case before the Authority?
Ans. The anti dumping proceedings being quasi judicial in nature, the
Designated Authority meticulously follows the norms of natural justice before
making the final recommendation of duty.
- The interested parties to the investigation are given adequate
opportunity to represent their case at several stages of investigation.
- The first opportunity is provided after the initiation of proceedings.
The Authority duly considers the submissions of all interested parties in
response to the initiation while giving its Preliminary findings.
- After the imposition of provisional duty, the interested parties
file their responses to the Preliminary findings and opportunity is provided
to them to submit the facts and figures to the Authority at the stage of
verification of their information if the same has been already filed in
response to the initiation.
- A formal Public hearing is held providing opportunities to all
interested parties to make their submissions before it. All oral submissions
made during the hearing need to be reproduced in writing for the Authority
to take the same on board.
- All these submissions of the different interested parties are given due
consideration and on that basis the Authority issues a disclosure of
essential facts which are proposed to form the basis of final findings.
- The parties to the investigation are also given the final opportunity to
respond to the disclosure and represent their case before the final findings
are notified.
Q.11 Can there be interim relief to the domestic industry pending
levy of final anti dumping duty? In how many days such interim relief can be
expected?
Ans. Yes, the Designated Authority recommends an interim relief which is
provided to the affected domestic industry in the form of provisional anti
dumping duty pending the finalisation of investigation proceedings. The
provisional anti dumping duty is recommended by the Authority in its preliminary
findings and the same is levied by the Ministry of Finance, Dept. of Revenue.
This serves as immediate relief to the domestic industry against the injury
caused to it by the dumping of goods.
Statutorily, the provisional anti dumping duty can not be levied earlier than 60
days from the date of initiation of proceedings. The endeavor of the Designated
Authority has been to recommend provisional duty immediately after the expiry of
the mandatory period of 60 days. That is to say, in normal circumstances, the
provisional anti dumping duty is recommended in a period of 60-70 days and
levied in a period of about 3 months from the date of initiation of the
proceedings.
Q. 12. Can the anti dumping duty be levied on a retrospective basis ?
- Anti dumping duty can be levied on a retrospective basis
in case it is found that –
- there is a history of dumping which caused injury or
that the importer was, or should have been aware that the exporter
practices dumping and that such dumping would cause injury; and
- the injury caused by massive dumping of an article
imported in a relatively short time which in the light of the timing and
the volume of imported article dumped and other circumstances is likely
to seriously undermine the remedial effect of the anti dumping duty
liable to be levied.
However, the anti dumping duty cannot be levied retrospectively beyond 90
days from the date of issue of Notification imposing duty.
Q.13 Who imposes the Anti Dumping duty, provisional or final?
Ans. While the Designated Authority (in the Department of Commerce)
recommends the anti dumping duty, provisional or final, it is the Ministry of
Finance, Dept. of Revenue which acts upon such recommendation within three
months and imposes/levies such duty.
Q.14 What are the implications for the importers who are liable to pay
anti-dumping duty if
- the final duty is less than the provisional duty;
- the final duty is more than the provisional duty;
Ans. Anti dumping duty is recommended and levied at two stages, provisional
and final. If the final duty levied is less than the provisional duty which has
already been levied and collected, the differential amount already collected as
provisional duty shall be refunded.
If the final duty imposed is more than the provisional duty already imposed and
collected, the difference shall not be collected.
If the provisional duty is withdrawn based on the final findings of the
Designated Authority, than the provisional duty already collected shall be
refunded.
Q.15 What is the arrangement made to notify the recommendations of the
Designated Authority?
Ans.
- The Designated Authority notifies its recommendations with respect to
Initiation / Preliminary Findings/Final Findings etc. through Government of
India, Gazette.
- Press Information Bureau, Ministry of Commerce & Industry also issues a
Press Release on the subject from to time.
- Also NIC, Ministry of Commerce and Industry makes available the details
with respect to recommendations of the Designated Authority on its web-site
http://commin.nic.in/doc.
- On receipt of recommendations from the Designated Authority, the Central
Government (i.e. Ministry of Finance, Dept. of Revenue) notifies, the
imposition of Anti-dumping Duties through Government of India, Gazette.
Q.16 Is the order of determination of anti-dumping duty appealable?
If so, which is the appellate Authority?
Ans. The law provides that an order of determination of existence degree and
effect of dumping is appealable before the Customs, Excise and Gold (Control)
Appellate Tribunal (CEGAT). However, as per the judicial view, only the final
findings/order of the Designated Authority/Ministry of Finance can be appealed
against before the CEGAT.
No appeal will lie against the Preliminary findings of the Authority and the
provisional duty imposed on the basis thereof. The Appeal to the CEGAT should be
filed within 90 days.
Q.17 Can the Anti-Dumping investigation, once initiated, be terminated?
If so, what are the circumstances?
Ans. The Designated Authority may suspend or terminate the
investigation in the following cases :
- if there is a request in writing from the
domestic industry at whose instance the investigation was initiated.
- when there is no sufficient evidence of dumping or
injury.
- if the margin of dumping is less than 2% of the export
price.
- the volume of dumped imports from a country is less
than 3% of the total imports of the like article into India or the volume of
dumped imports collectively from all such countries is less than 7% of the
total imports.
- If injury is negligible.
Q.18 Aren’t the Anti Dumping measures injurious to the interests of the
consumers?
Ans. The purpose of anti dumping duties, in general, is to eliminate dumping
which is causing injury to the domestic industry and to re-establish a situation
of open and fair competition in the Indian market, which is in the general
interest of the country.
- The imposition of anti dumping duty might affect the price levels of the
products manufactured using the subject goods. However, fair competition in
the Indian market will not be reduced by the anti dumping measures.
- On the contrary, imposition of anti dumping duty would remove the unfair
advantages gained by the overseas exporters through their dumping practices,
would prevent the decline of the domestic industry and would create
conditions for fair trade.
- The imposition of anti dumping measures would not restrict imports from
the subject country in any way and therefore, would not hinder the
consumers’ access to the imported goods.
Q.19 What is the period of validity of the Anti Dumping duty imposed?
Can such duty, once imposed, be reviewed before and after the expiry of its full
term?
Ans. The anti dumping duty shall remain in force for a period of five years from
the date of imposition of duty. However, such duty can be reviewed by the
Designated Authority anytime before the expiry of the said period.
- The Authority has the power to review the need for continuation of anti
dumping duty. Such a review can be done on the basis of a request received
from an interested party in view of the changed circumstances.
- The review may result in the withdrawal of the duty or in the variation
of the duty level depending upon the new circumstances. Generally speaking,
an interested party can file a request for review only after a year from the
imposition of duty.
- A review shall follow the same procedure as prescribed for investigation
of a fresh case to the extent applicable.
Q.20 Does the levy of Anti Dumping duty on a particular product
extend to all imports of that product? Which imports are exempt from such duty?
Ans. The levy of anti dumping duty is both exporter specific and
country specific.
- It extends to the imports from only those countries in respect of which
dumping has been alleged and the complaint has been filed and duty
recommended.
- Such duty will not apply to the imports from other countries in
respect of which the domestic industry has not alleged dumping.
- However, the anti dumping duty is not payable on imports against the
Advance License scheme or on imports by the 100% EOUs /EPZ units, even if
such imports are from the countries under complaint.
Q.21 Can the Anti-Dumping and Anti-Subsidy measures be applied
simultaneously?
Ans. GATT agreement as well as the Indian laws provide that the injured domestic
industry is permitted to file for relief under the anti-dumping as well as
countervailing duties. However, no articles shall be subjected to both
countervailing and anti-dumping duties to compensate for the same situation of
dumping or export subsidization.
III. MISCELLANEOUS MATTERS
Q.1. What is the significance of anti dumping measures in
India in the context of lifting of QR?
Ans. India is currently in the process of phasing out its quantitative
restrictions regime in relation to imports. With removal of licensing
restrictions on imports, there has been a tendency on the part of several
trading partners of India to resort to dumping of their goods of different kinds
into India, thereby creating a situation of unfair competition in the domestic
market whereby the domestic industry has suffered injury.
- To address such a scenario of unfair trade, and to provide the requisite
remedy to the domestic industry against injury caused by such dumping, the anti
dumping measures have assumed a great deal of significance.
- The anti dumping measures do not aim at providing protection to the domestic
industry per se. These are only remedial measures for removal of injury to the
domestic industry caused by the dumping of goods. The object behind such
measures is to re-establish fair competition and to provide the domestic
industry a level playing field.
- The paramount objective of the multi-lateral trade regime of WTO is to
establish free and fair international trade. With removal of QRs, India has
moved towards the regime of free trade. At the same time, anti dumping measures
can be applied, where warranted, in the interest of fair trade.
Q. 2. There are number of cases in which anti dumping duty is imposed
on imports of goods from China. Does India specifically target China for
application of anti dumping measures? Is it due to China’s non-membership of WTO
that India has so many anti dumping cases against China?
Ans. The anti-dumping investigations in India are conducted under the
national law as enshrined in the Customs Tariff Amendment Act, 1975, as amended
in 1995, which is in consonance with the provisions of WTO. These measures are
country neutral and the rules apply uniformly to China as to any other country.
There is no intention on the part of DGAD or the Government of India to
specifically target China for application of anti-dumping measures. The
principles and procedures prescribed under the law are fully complied with in
the cases involving China as in the cases involving other countries.
The number of cases against China has got nothing to do with its not being a
member of WTO. The anti-dumping action initiated by the Authority is governed by
our national law and rules framed there under. India has extended Most Favoured
Nation (MFN) treatment to China, which enjoins upon India the obligation of
non-discriminatory treatment of China vis-à-vis other trading partners including
WTO members. Thus the question of discriminating against China does not arise so