DUMPING

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DUMPING

• A non-Tariff barrier to Trade
• or
• Protection for Australian Industry

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OVERVIEW

• Dumping, What is it?
• Understanding the terms
• Definitions
• Dumping Duty Elements
• Interim Dumping Duty
• Reassessment Procedures

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Dumping, what is it?

• A commercial decision
• Common business practice
• Selling goods below Current Domestic Value in
  the country of Export

Is it illegal?
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Why do we have the legislation?

• Protection of Australian industry!

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Dumping is a simple exercise

• Basic principles?
• Decide on criteria
• Calculate values
• Determine result

The devil is in the calculation
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The Terms

• Normal Value S269TAC
• Export Price S269TAB
• Material Injury S269TAE
• Ascertained (Non-Injurious) Export
  Price S269TACA
• Causal Effect S269TAE
• Dumping Commodities Register (DCR)

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The Terms

• Dumping
• Anti-Dumping Action
• Third Country Dumping
• Interim Dumping Duty
• Dumping Cash Securities
• Countervailing Duty
• Third Country Countervailing Duty
• Price Undertakings

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References

• Customs Act
• Part XVB, Division 1, Section 269T
• Customs Tariff (Anti-Dumping) Act
• Section 8, 9 - Dumping Duties
• Section 10, 11 - Countervailing Duties
• Section 12 - Interim Duty not to exceed cash
  security

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Dumping Commodities Register DXP - adjustment for
credit terms DCR..1 per month When to
deduct. Currency Conversion - at the Customs
ruling rate applicable at the date of the export
transaction (valuation date) However - rate of
exchange.that best establishes the sale
S269TAF Dumping Reason Codes COMPILE Field Codes
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Dumping Duty Section 269TG, Customs Act Section
8(2), Customs Tariff (Anti-Dumping) Act
Amount by which Normal Value exceeds the
Export Price Section 8(6)
- Normal Value is determined by Customs
investigation (S269TAC) - Export Price is
determined during the same investigation
(S269TAB)
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Interim Dumping Duty Section 8(3), Customs Tariff
(Anti-Dumping) Act pending final assessment of
dumping duty payable
Amount by which Normal Value exceeds Ascertained
Export Price S8(4)
Amount by which Ascertained Export Price exceeds
Dumping Export Price
PLUS
- Normal Value is determined by Customs
investigation - Ascertained Export Price is
determined during the same investigation as the
non-injurious export price
Ascertained Export Price less the actual price at
FOB in the export sale
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Interim Dumping Duty

• Two components
• Part (a) always payable
• Part (b) payable, re circumstances of sale
• Importers may apply for reassessment
• Part XVB - Division 4, Customs Act, S269V onwards
• ACDN 99/019
• Requirements for reassessment
• not more than 6 months after the end of the
  period
• importer contends dumping duty less than
  collected
• ACDN 99/019

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Application Processfor reassessment

• Lodged within the next period
• In writing
• Describe the goods on each consignment
• Provide an amount - the difference
• Customs has 155 days to recommend
• Information not supplied on time disregarded

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Dumping Cash Security

• Interim measure, Section 269TD
• sufficient grounds (prima facie case)
• - preliminary affirmative action
• require take securities - 269TD(4)
• Conversion of securities to DD or IDD
• Interim duty collected not to exceed security
• S12 CT(AD)Act

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RECENT CASE - QUENOS, Polyethylene LLPDE - ACDN
2003/27 RKOR THAI HDPE - ACDN
2003/28 RKOR MLAY SING SWED THAI Revisio
n of Securities for ACDN 2003/36
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Anti-Dumping Investigations Starting an
investigation Application process Termination
of an investigation Timelines
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Starting an investigation Industry determines
reason for current ills due to dumped
imports Builds its case based on known
factors loss of market share loss of
profits Is able to quantify the amount of
material injury Is able to show a causal
link between dumping activity material
injury
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Application process Lodged in accordance with
Section 269TB(1), where (a) a consignment of
goods (i) has been imported in
Australia (ii) likely to be imported into
Australia (iii) may be imported into Australia
being like goods to which (i) or (ii) applies
- (b) there is, or may be, an Australian industry
producing like goods and (c) a person believes
there are, or may be reasonable grounds for
dumping or countervailing notice that person may
apply to the Minister
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Application process Section 269TB(2) - Third
Country Dumping application where (a) a
consignment of goods (i) has been imported in
Australia (ii) likely to be imported into
Australia (iii) may be imported into Australia
being like goods to which (i) or (ii) applies
- (b) there is, in a third country an industry
producing like goods and (c) the Government of
that third country believes there are, or may be
reasonable grounds for dumping or countervailing
notice that Government may apply to the Minister
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Application process The CEO must notify the
government of the exporting country only if not
deciding to reject the application The CEO must
notify the government(s) if countervailable
subsidies suspected of the exporting country -
nominated exporters of any other country -
allegedly providing subsidies invite
consultation as to existence level of
subsidies Application to be in approved form
and lodged in approved manner Definition of
sufficient part of domestic industry Sec.
269TB(6)
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• Termination of an investigation
• CEO must terminate investigation if
• no dumping margin or
• margin considered negligible (2) Sec. 269TDA(1)
• no countervailing subsidy or
• subsidy considered negligible (2) Sec.
  269TDA(1), (16).
• volume is negligible (3 of total volume exported
  to Aust.)
• REFER ACDN 2003/30

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Timelines

• Prima Facie screening 20 days
• Customs investigation
• Preliminary affirmative (securities available)
  60 days
• Statement of essential fact - 110 days (may be
  extended to 155 days)
• Recommendation to Minister - max 155 days
• Ministers decision to impose duties or not
• Trade Measures Review Officer (Part XVB -
  Division 8, 9)
• reference if initial application rejected - 60
  days
• reference if Customs investigation terminated
• interested party requests to review Ministers
  decision - 30 days
• recommendation to Minister re review - 60 days

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Summary Dumping action Dumping Cash
Securities Interim Dumping Duty Dumping
Duty Countervailing Duty Third Country Dumping
Countervailing Dumping Commodities
Register reason codes, exchange rates,
interest Application process Review
Process RECENT CASE - QUENOS, Polyethylene
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Practical questions answering guide Similarity
in structure of all dumping questions Requirement
to establish if dumping occurs What will you need
to calculate to answer the question? USE FULL
QUANTITIES! Identify the structure - what is the
question? Will Interim Dumping calculation be
required? Structure your answer Start by
calculating DXP, from invoice details Then
calculate AEP, from given details Ensure they
are in same currency and level Show your
calculation workings Make a decision - is Dumping
Duty or Interim Dumping Duty payable ? Answer the
Question asked!
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• Theory questions answering guide
• These are not usual but might include
• Application process inc. timelines
• Definitions
• Dumping,
• Interim DD,
• DD,
• Countervailing D,
• Subsidies
• TMRO
• What is the examiner looking for?
• How well do you know the Dumping legislation?
• Do you understand the process?

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Questions Where are we now? How much dont you
understand?