DUMPING
A non-Tariff barrier to Trade
or
Protection for Australian Industry
OVERVIEW
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Dumping, What is it?
Understanding the terms
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Definitions
Dumping Duty Elements
Interim Dumping Duty
Reassessment Procedures
Dumping, what is it?
• A commercial decision
• Common business practice
• Selling goods below Current Domestic Value
in the country of Export
Is it illegal?
Why do we have the
legislation?
Protection of Australian
industry!
Dumping is a simple exercise
• Basic principles?
– Decide on criteria
– Calculate values
– Determine result
The devil is in the calculation
The Terms
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Normal Value
S269TAC
Export Price
S269TAB
Material Injury
S269TAE
Ascertained (Non-Injurious) Export Price
S269TACA
• Causal Effect
S269TAE
• Dumping Commodities Register (DCR)
The Terms
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Dumping
Anti-Dumping Action
Third Country Dumping
Interim Dumping Duty
Dumping Cash Securities
Countervailing Duty
Third Country Countervailing Duty
Price Undertakings
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
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
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)
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)
- Normal Value is determined by
Customs investigation
- Ascertained Export Price is
determined during the same
investigation as the non-injurious
export price
Amount by which
P Ascertained Export
L Price exceeds Dumping
U Export Price
S
Ascertained Export Price less the
actual price at FOB in the export
sale
Interim Dumping Duty
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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
Application Process
for 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
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
RECENT CASE - QUENOS, Polyethylene
LLPDE -
ACDN 2003/27
RKOR
THAI
HDPE -
ACDN 2003/28
RKOR
MLAY
SING
SWED
THAI
Revision of Securities for ACDN 2003/36
Anti-Dumping Investigations
Starting an investigation
Application process
Termination of an investigation
Timelines
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
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
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
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)
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
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
•Minister’s 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 Minister’s decision - 30 days
•recommendation to Minister re review -
60 days
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
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!
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?
Questions
Where are we now?
How much don’t you understand?