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Tariff Identification Assessment and Collection of Countervailing Duty on Subsidized Articles.


CUSTOMS TARIFF (IDENTIFICATION, ASSESSMENT AND COLLECTION OF COUNTERVAILING DUTY ON SUBSIDIZED ARTICLES AND

  1. Short title and commencement
  2. Definitions
  3. Appointment of designated authority.
  4. Duties of the designated authority
  5. Decision as to country of origin
  6. Initiation of investigation
  7. Principles governing investigations
  8. Confidential informations
  9. Accuracy of the information
  10. Investigation in the territory of other specified countries
  11. Nature of subsidy

CUSTOMS TARIFF (IDENTIFICATION, ASSESSMENT AND COLLECTION OF COUNTERVAILING DUTY ON SUBSIDIZED ARTICLES AND FOR DETERMINATION OF INJURY) RULES, 1995

  1. Short title and commencement. -
    1. The Rule may be called Customs Tariff (Identification, assessment and collection of countervailing duty on subsidies articles and for determination injury) Amendment ) Rules 2006.
    2. They shall come into force on the date of their publication in the Official Gazette.
  2. Definitions. - In these rules, unless the context otherwise requires, -
    1. "Act" means the Customs Tariff Act,1975 (51 of 1975);
    2. "domestic industry" means the domestic producers as a whole of the like article or domestic producers whose collective output of the said article constitutes a major proportion of the total domestic production of that article, except when such producers are related to the exporters or importers of the alleged subsidised article, or are themselves importers thereof, in which case such producers shall be deemed not to form part of domestic industry:

      Provided that in exceptional circumstances referred to in sub-rule (3) of rule 13, the domestic industry in relation to the article in question shall be deemed to comprise two or more competitive markets and the producers within each of such market be deemed as a separate industry if, -
      1. the producers within such market sell all or almost all of their production of the article in question in that market, and
      2. the demand in the market is not in any substantial degree supplied by producers of the said article located elsewhere in the territory;
    3. "interested party" includes -
      1. an exporter or foreign producer or the importer of an article subject to investigation for being subsidised or a trade or business association a majority of the members of which are producers, exporters or importers of such an article; and
      2. a producer of the like article in India or a trade and business association a majority of the members of which produce the like article in India;
    4.  "provisional duty" means a countervailing duty imposed under sub-section (2) of section 9A of the Act;
    5. "specified country" means a country or territory which includes the country or terriotry with which the Government of India has an agreement for giving it the most favoured nation treatment;
    6. all words and expressions used in these rules, but not defined, shall have the meaning respectively assigned to them in the Act.
  3. Appointment of designated authority. -
    1. The Central Government may, by notification in the Official Gazette , appoint a person not below the rank of a Joint Secretary to the Government of India or such other person as that Government may think fit as the designated authority for purposes of these rules.
    2. The Central Government may provide to the designated authority the services of such other persons and such other facilities as it deems fit.
  4. Duties of the designated authority. - It shall be the duty of the designated authority in accordance with these rules -
    1. to investigate the existence, degree and effect of any subsidy in relation to the import of an article;
    2. to identify the article liable for countervailing duty;
    3. to submit its findings, provisional or otherwise to the Central Government as to -
      1. the nature and amount of subsidy in relation to an article under investigation.
      2. the injury or threat of injury to an industry established in India or material retardation to the establishment of an industry in India consequent upon the import of such articles from the specified countries.
    4. to recommend the amount of countervailing duty, which if levied would be adequate to remove the injury to the domestic industry and the date of commencement of such duty; and
    5. to review the need for continuance of countervailing duty.
  5. Decision as to country of origin. - In cases where articles are not imported directly from the country of origin but are imported from an intermediate country, the provisions of these rules shall be fully applicable and any such transaction shall, for the purpose of these rules be regarded as having taken place between the country of origin and the country of importation.
  6. Initiation of investigation. -
    1. Except as provided in sub-rule (4) the designated authority shall initiate an investigation to determine the existence, degree and effect of alleged subsidy only upon receipt of a written application by or on behalf of the domestic industry.
    2.  An application under sub-rule (1) shall be in the form as may be specified by the designated authority in this behalf and the application shall be supported by evidence of -
      1. subsidy and, if possible, its amount,
      2.  injury where applicable, and
      3. where applicable, a casual link between such subsidized imports and alleged injury.
    3. The designated authority shall not initiate an investigation pursuant to an application made under sub-rule (1) unless -
      1. it determines, on the basis of an examination of the degree of support for, or opposition to the application expressed by domestic producers of the like article, that the application has been made by or on behalf of the domestic industry:

        Provided that no investigation shall be initiated if domestic producers expressly supporting the application account for less than twenty five per cent of the total production of the like product by the domestic industry, and
      2. it examines the accuracy and adequacy of the evidence provided in the application and satisfies itself that there is sufficient evidence regarding -
        1. subsidy,
        2. injury, where applicable; and
        3. where applicable, a casual link between such subsidized imports and the alleged injury, to justify the initiation of an investigation.

          Explanation. - For the purpose of this rule, the application shall be considered to have been made "by or on behalf of domestic industry" if it is supported by those domestic producers whose collective output constitutes more than fifty per cent 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.
    4. Notwithstanding anything contained in sub-rule (1), the designated authority may initiate an investigation suo motu, if it is satisfied from the information received from the Commissioner of Customs appointed under the Customs Act, 1962 (52 of 1962) or any other source that sufficient evidence exists as to the existence of the circumstances referred to in sub-clause (b) of sub-rule (3).
    5. The designated authority shall notify the government of the exporting country before proceeding to initiate an investigation.
  7.  Principles governing investigations. -
    1. The designated authority shall, after it has decided to initiate investigation to determine the existence, degree and effect of any alleged subsidization of any article, issue a public notice notifying its decision. Public notice regarding initiation of investigation shall, inter alia, contain adequate information on the following:
      1. the name of the exporting countries and the article involved;
      2. the date of initiation of the investigation;
      3. a description of the subsidy practice or practices to be investigated;
      4. a summary of the factors on which the allegation of injury is based;
      5. the address to which representations by interested countries and interested parties should be directed; and
      6. the time-limits allowed to interested countries and interested parties for making their views known.
    2. A copy of the public notice shall be forwarded by the designated authority to the known exporters of the article alleged to have been subsidized, the government of the exporting country concerned and other interested parties.
    3. The designated authority shall also provide a copy of the application referred to in sub-rule (1) of rule 6 to -
      1.  the known exporters or the concerned trade association where the number of exporters is large, and
      2. the government of the exporting country :

        Provided that the designated authority shall also make available a copy of the application, upon request in writing, to any other interested party.
    4. The designated authority may issue a notice calling for any information in such form as may be specified by it from the exporters, foreign producers and governments of interested countries and such information shall be furnished by such persons in writing within thirty days from the date of receipt of the notice or within such extended period as the designated authority may allow on sufficient cause being shown.

      Explanation. - For the purpose of this sub-rule the public notice and other documents shall be deemed to have been received one week from the date on which these documents were sent by the designated authority or transmitted to the appropriate diplomatic representative of the exporting country.
    5. The designated authority shall also provide opportunity to the industrial users of the article under investigation, and to representative consumer organisations in cases where the article is commonly sold at retail level, to furnish information which is relevant to the investigation regarding subsidization and where applicable injury and casuality.
    6. The designated authority may allow an interested country or an interested party or its representative to present information relevant to the investigation orally also, but such oral information shall be taken into consideration only when it is subsequently reproduced in writing.
    7. The designated authority shall make available the evidence presented by one party to other interested parties participating in the investigation.
    8.  In a case where an interested party refuses access to, or otherwise does not provide necessary information within a reasonable period, or significantly impedes the investigation, the designated authority may record its findings on the basis of facts available to it and make such recommendations to the Central Government as it deems fit under such circumstances.
  8. Confidential informations. -
    1. Notwithstanding anything contained in sub-rule (1), (2), (3) and (7) of rule 7, sub-rule (2) of rule 14, sub-rule (4) of rule 17 and sub-rule (3) of rule 19 copies of applications received under sub-rule (1) of rule 6 or any other information provided to the designated authority on a confidential basis by any party in the course of investigation, shall, upon the designated authority being satisfied as to its confidentiality, be treated as such by it and no such information shall be disclosed to any other party without specific authorisation of the party providing such information.
    2. The designated authority may require the parties providing information on confidential basis to furnish non-confidential summary thereof in sufficient details to permit a reasonable understanding of the substance of the confidential information and if, in the opinion of a party providing such information, such information is not susceptible of summary, such party may submit to the designated authority a statement of reasons why summarisation is not possible.
    3. Notwithstanding anything contained in sub-rule (2), if the designated authority, is satisfied that the request for confidentiality is not warranted or the supplier of the information is either unwilling to make the information public or to authorise its disclosure in generalised or summary form, it may disregard such information.
  9. Accuracy of the information. - Except in cases referred to in sub-rule (8) of rule 7 the designated authority shall during the course of investigation satisfy itself as to the accuracy of the information supplied by the interested parties upon which its findings are based.
  10. Investigation in the territory of other specified countries. -
    1. The designated authority may carry out investigations in the territories of other countries, in order to verify the information provided or to obtain further details :

      Provided that the designated authority notifies to such country in advance and such country does not object to such investigation.
    2. The designated authority may also carry out investigations at the premises of any commercial organisation and may examine its records if such organisation agrees and if the country in whose territory the said commercial organisation is situated, is notified and has not raised any objection for the conduct of such investigation.
  11. Nature of subsidy. -
    1. The designated authority while determining the subsidy shall ascertain as to whether the subsidy under investigation -
      1.  relates to export performance including those illustrated in Annexure III to these rules, or;
      2. relates to the use of domestic goods over imported goods in the export article, or
      3. it has been conferred on a limited number of persons, engaged in manufacturing, producing or exporting the article unless such a subsidy is for -
        1. research activities conducted by or on behalf of persons engaged in the manufacture, production or export; or
        2. assistance to disadvantaged regions within the territory of the exporting country; or
        3. assistance to promote adaptation of existing facilities to new environmental requirements:

          OMITTED

          Explanation. -
          1. For the purposes of sub-clause (i) of clause (c) the term "subsidy for research activity" means assistance for research activities conducted by commercial organisations or by higher education or research establishments on a contract basis with the commercial organisations if the assistance covers not more than seventy five per cent of the costs of industrial research or fifty per cent of the costs of pre-competitive development activity and provided that such assistance is limited exclusively to -
            1. costs of personnel (researchers, technicians and other supporting staff employed exclusively in the research activity);
            2. costs of instruments, equipment, land and buildings used exclusively and permanently (except when disposed of on a commercial basis) for the research activity;
            3. costs of consultancy and equivalent services used exclusively for the research activity, including bought in research, technical knowledge, patents, etc.;
            4. additional overhead costs incurred directly as a result of the research activity; and
            5. other running costs (such as those of materials, supplies and the like), incurred directly as a result of the research activity.
          2. For the purposes of sub-clause (ii) of clause (c), the term "subsidy for assistance to disadvantaged regions" means assistance to disadvantaged regions within the territory of the exporting country given pursuant to a general framework of regional development and such subsidy has not been conferred on limited number of enterprises within the eligible region:

            Provided that -
            1. each disadvantaged region must be a clearly designated contiguous geographical area with a definable economic and administrative identity;
            2. the region is considered as disadvantaged on the basis of neutral and objective criteria, indicating that the region's difficulties arise out of more than temporary circumstances; such criteria must be clearly spelled out in law, regulation, or other official document, so as to be capable of verification;
            3. the criteria shall include a measurement of economic development which shall be based on at least one of the following factors -
              1. one of either income per capita or household income per capita, or Gross Domestic Product per capita, which must not be above eighty five per cent of the average for the territory concerned;
              2. unemployment rate, which must be at least one hundred and ten per cent of the average for the territory concerned, as measured over a three-year period; such measurement, however, may be a composite one and may include other factors.
          3. For the purposes of sub-clause (iii) of clause (c), "subsidy for assistance to promote adaptation of existing facilities to new environmental requirements" means assistance to promote adaptation of existing facilities to new environmental requirements imposed by law and/or regulations which result in greater constraints and financial burden on commercial organizations :

            Provided that the assistance -
            1. is a one-time non-recurring measure; and
            2. is limited to twenty per cent of the cost of adaptation; and
            3. does not cover the cost of replacing and operating the assisted investment, which must be fully borne by commercial organizations; and (iv) is directly linked to and proportionate to a commercial organisation's planned reduction of nuisances and pollution, and does not cover any manufacturing co

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