• Anti Dumping

  • Anti-dumping duty is a measure to correct the situation arising out of the dumping of goods and its distorting effect on domestic producers of similar goods. Rapid industrialization has resulted in large-scale production – and in this situation dumping enables the producer to establish a dominant position in the market. This is common in international commercial practice for export prices to be lower than the domestic ones. Therefore there is nothing inherently immoral about the practice of dumping. However, when dumping causes or threatens to cause, material injury to the domestic industry it is viewed gravely.

    Dumping is said to occur when the goods are exported by a country to another country at a price lower than its normal value and this causes injury to domestic industry. This is an unfair trade practice which can have a distortive effect on international trade as it keeps competitors out of a particular market. Anti dumping measures rectify the situation arising out of the dumping of goods and its trade distortive effect. The use of anti dumping measure as an instrument of fair competition is permitted by the WTO. Anti dumping duty is recognised as an instrument for ensuring fair trade and is not a measure of protection per se for the domestic industry. It provides relief to the domestic industry against the injury caused by dumping.

    Although anti dumping duty is levied and collected by the Customs Authorities, it is entirely different from the Customs duties not only in concept and substance, but also in purpose and operation. The following are the main differences between the two: (i) Conceptually, anti dumping and the like measures in their essence are linked to the notion of fair trade. The object of these duties is to guard against the situation arising out of unfair trade practices while customs duties are levied as a means of raising revenue and for overall development of the economy.  (ii) Customs duties fall in the realm of trade and fiscal policies of the Government while anti dumping measures are trade remedial measures.  (iii) The object of anti dumping is to offset the injurious effect of international price discrimination while customs duties have implications for the government revenue and for overall development of the economy.  (iv) Anti dumping duties are not necessarily in the nature of a tax measure inasmuch as the Authority is empowered to suspend these duties in case of an exporter offering a price undertaking. Thus such measures are not always in the form of duties/tax.  (v) Anti dumping duties are levied against exporter / country inasmuch as they are country specific and exporter specific as against the customs duties which are general and universally applicable to all imports irrespective of the country of origin and the exporter.  

    There is a WTO Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade (GATT) 1994 which is commonly known as the Anti dumping Agreement.

    Legal framework for Anti dumping measures in India is as follows: The Sections 9A, 9B and 9C of the Customs Tariff Act, 1975 as amended in 1995, the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 and the Customs Tariff (Identification, Assessment and Collection of Countervailing Duty on Subsidised Articles and for Determination of Injury) Rules, 1995 form the legal basis for anti-dumping investigations and for the levy of anti-dumping duties in India.

    The wide-ranging and detailed procedural requirements relating to investigations focus on the sufficiency of petitions to ensure that merit fewer investigations are not initiated, on the establishment of time periods for the completion of investigations, and on the provision of access to information to all interested parties, along with rational opportunities to present their views and arguments. The Rules and regulations also provide for the timing of the imposition of anti-dumping duties, the duration of such duties, and oblige Designated Authority to periodically review the continuing need for anti-dumping duties and price undertakings. It is also provided at its discretion, take anti-dumping actions at the request of a third country, which is a member of the World Trade Organization. The anti-dumping procedures are based on an application made by the concerned domestic industry to die Designated Authority in the Department 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.

    Institutional arrangement in India for anti dumping measures against unfair trade practices is as follows: Anti dumping (as also anti subsidies & countervailing measures) in India are administered by the Directorate General of Anti dumping and Allied Duties (DGAD) functioning in the Department 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 and 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 Directorate General of Anti dumping and Allied Duties (DGAD) recommend the Anti-dumping duty, it is the Ministry of Finance, which levies such duty.

    Import of undervalued products to evade customs duty or through illegal trade channels like smuggling does not fall within the purview of anti-dumping measures.

    Hello Counsel represents its clients in challenging various anti-dumping and countervailing duties before the authorities. We provide various kinds of legal services to our clients in respect of the antidumping laws including but not limited to assisting companies to investigate and analyze problems that domestic industries suffer in case of dumping, helping the companies to gather and choose evidence with respect to the problems faced by various industries, to investigate relevant import statistics, materials and sales status in India of foreign similar products. We regularly update our clients on various anti dumping laws, policies and notifications, anti-circumvention laws, etc. We have successfully acted for exporters, importers and domestic industry in various antidumping matters before Directorate General of Antidumping and Allied Duties (DGAD), India. We provide assistance in making, reviewing and translating anti-dumping annual review application, sunset review application, and other kinds of legal documents and help them in filling out various kinds of questionnaires; providing consultancy and legal opinions to clients and liaison with governmental authorities and industrial associations.

    Kindly CLICK HERE or e-mail us at office@hellocounsel.com if you are facing any Legal Issue and want to have Legal Consultations with the empanelled Lawyers at Hello Counsel.


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