INVESTIGATION BY DESIGNATED AUTHORITY UNDER ANTI DUMPTING

[Mr. M. GOVINDARAJAN]

Section 9A of Customs Tariff Act, 1975 gives powers to the Central Government to impose an anti dumping duty which an article is exported by an exporter or producer from any country of territory to India at less than the normal value.  In this regard Section 9A (6) and Section 9B (5) of the Act give powers to Central government to issue rules for the implementation of the same.

The Central Government issued Rule entitled ‘Customs Tariff (Identification, Assessment and Collection of Duty or Additional Duty on dumped article and for determination of Injury ) Rules, 1995.  These rules were based on Article VI of GATT, 1994.

Rule 3 provides that the Central Government is obliged to appoint a person not below the rank of Joint Secretary to Government as the Designated Authority.  The duties of the Designated Authority are provided in Rule 4 as detailed below:

• to investigate as to the existence, degree and effect of any alleged dumping in relation to import of any article;
• to identify the article liable for anti-dumping duty;
• to submit its findings, provisional or otherwise to the Central Government as to-

• normal value, export price and the margin of dumping in relation to the article under investigation; and
• 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 article from the specified countries;

• to recommend to the Central Government-

• the amount of anti-dumping duty equal to the margin of dumping or less, which if levied, would remove the injury to the domestic industry, after considering the principles laid down in the Annexure III to these rules; and
• the date of commencement of such duty;

• to review the need for continuance of anti-dumping duty.

Thus one of the duties of the Designated Authority is to investigate as to the existence, degree and effect of any alleged dumping in relation to import of any article.

Rule 5 provides for initiation of  investigation.  Rule 5(1) empowers the Designated Authority to initiate an investigation, upon receipt of a written application by or on behalf of the domestic industry.    Rule 5(4) enables the Designated Authority to initiate an investigation even on suo motu. If it is satisfied from the information received from the Commissioner of Customs or from any other source that sufficient evidence exists as to the  existence of circumstances referred to in Sub-rule (3).

The principles governing the investigation undertaken by the Designated Authority under Rule 5 are given in extenso  in Rule 6 which are as detailed below:

• The Designated Authority shall issue a public notice notifying the decision;
• The public notice shall contain the required information;
• The copy of the public notice shall be forwarded to the known exporters of the article alleged to have been dumped, the Government of the exporting countries and other interested persons;
• The Designated Authority shall also provide the copy of the application to all concerned;
• The copy of the application shall be made available to any other interested parties who makes a request in writing;
• The Designated Authority may issue a notice calling for information required to any person concerned and such person shall give reply within 30 days from the date of receipt of the notice or such extended period as allowed;
• The Designated Authority shall also provide opportunity to the industrial users of the article under investigation, and to representative consumer organizations in cases where the article is commonly sold at the retail level, to furnish information which is relevant to the investigation regarding dumping, injury where applicable, and causality;
• The Designated Authority may allow an interested party or its representative to present the information relevant to the investigation orally but such oral information shall be taken into consideration by the designated authority only when it is subsequently reproduced in writing.

Rule 9 provides that the designated authority may carry out investigation in the territories of other countries, if the circumstances of a case so warrant   Rule 11 provides that in the case of imports from specified countries, the designated authority shall record a further finding that import of such article into India causes or threatens material injury to any established industry in India or materially retards the establishment of any industry in India.    He shall determine-

• the injury to domestic industry,
• threat of injury to domestic industry,
• material retardation to establishment of domestic industry; and
• a causal link between dumped imports and injury, 

taking into account all relevant facts, including the volume of dumped imports, their effect on price in the domestic market for like articles and the consequent effect of such imports on domestic producers of such articles and in accordance with the principles set out in Annexure II to these rules.

Under Rule 12 the Designated Authority is entitled to record a preliminary finding, regarding the export price, nominal value and margin of dumping etc.,  The preliminary findings are to be published by the Designated Authority in the form of a public notice.

By virtue of Rule 13 the Government may, on the basis of preliminary finding of the Designated Authority, impose a provision duty not exceeding the margin of dumping.

Rule 14 provides that the Designated Authority may terminate the investigation by issuing a public notice if-

• it receives a request in writing for doing so from or on behalf of the domestic industry affected, at whose instance the investigation was initiated;
• it is satisfied in the course of an investigation, that there is not sufficient evidence of dumping or, where applicable, injury to justify the continuation of the investigation;
•  it determines that the margin of dumping is less than two per cent of the export price;
•  it determines that the volume of the dumped imports, actual or potential, from a particular country accounts for less than three per cent of the imports of the like product, unless, the countries which individually account for less than three per cent of the imports of the like product, collectively account for more than seven per cent of the import of the like product; or
• it determines that the injury where applicable, is negligible.

Rule 15 provides for the suspension or termination of investigation, if the exporter of the article in question-

• furnishes an undertaking in writing to the designated authority to revise the prices so that no exports of the said article are made to India at dumped prices, or
•  in the case of imports from specified countries undertake to revise the prices so that injurious effect of dumping is eliminated and the designated authority is satisfied that the injurious effect of the dumping is eliminated

The designated authority shall complete the investigation and record its finding, if the exporter so desires, or it so decides.

Rule 16 provides that one of the important obligations cast upon the Designated Authority is to inform all the interested parties of the essential facts  under consideration, which form the basis for its decision, even before giving the final findings.

The manner in which and the time schedule within which the Designated Authority is obliged to render its final finding, are stipulated in detail in Rule 17.   Rule 17(1) contains two stipulations –

• One relating to the time schedule within which the final findings are to be rendered; and
• The second relating to the contents of such findings.

Rule 17(3) provides that the Designated Authority should determine the margin of dumping for each known exporter or producer.   Rule 17(4) requires the Designated Authority to issue a public notice regarding its findings.  Thereafter the Government may issue a notification imposing Anti dumping duty in terms of Rule 18(1) and publish the same in the Official Gazette, within three months of publication of the final findings.  The duty so levied shall take effect only from the date of publication.   After such imposition of duty, it is always open to the Designated Authority to review the same under Rule 23 (1), if there is no justification for the continued imposition.

The decision to levy anti dumping duty can be challenged by an aggrieved person by way of an appeal under Section 9C, before CESTAT.