Anti Dumping

Anti-Dumping & Antisubsidy measures : FAQs

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:

1. the domestic industry on whose complaint the proceedings are initiated;

2. The exporters or the foreign producers of the like articles subject to investigation;

3. The importers of the same article allegedly dumped into India;

4. The Government of the exporting country/ countries.

5. 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?

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:

1. 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

2. 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 ?

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:

A. 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 .

B. 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.

C. 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.

D. 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.

E. 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.

F. 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.

G. 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.

H. 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.

I. 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?

• 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 ?

 Ans. Anti dumping duty can be levied on a retrospective basis in case it is found that –

1. 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

2. 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

1. the final duty is less than the provisional duty;
2. 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 :

1. if there is a request in writing from the domestic industry at whose instance the investigation was initiated.

2. when there is no sufficient evidence of dumping or injury.

3. if the margin of dumping is less than 2% of the export price.

4. 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.

5. 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.