DUMPING

1. DUMPING A non-Tariff barrier to Trade or Protection for Australian Industry

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

3. Dumping, what is it? A commercial decision Common business practice Selling goods below Current Domestic Value in the country of Export Is it illegal?

4. Why do we have the legislation? Protection of Australian industry!

5. Dumping is a simple exercise • Basic principles? • Decide on criteria • Calculate values • Determine result The devil is in the calculation

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

7. The Terms • Dumping • Anti-Dumping Action • Third Country Dumping • Interim Dumping Duty • Dumping Cash Securities • Countervailing Duty • Third Country Countervailing Duty • Price Undertakings

8. 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

9. 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

10. 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)

11. 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

12. 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

13. 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

14. 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

15. 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

16. Anti-Dumping Investigations Starting an investigation Application process Termination of an investigation Timelines

17. 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

18. 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 personbelieves there are, or may be reasonable grounds for dumping or countervailing notice that person may apply to the Minister

19. 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

20. 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)

21. 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

22. 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

23. 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

24. 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!

25. 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?

26. Questions Where are we now? How much don’t you understand?