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DAMODARAM SANJIVAYYA NATIONAL LAW UNIVERSITY

VISAKHAPATNAM, A.P., INDIA

PROJECT TITLE
ANTI DUMPING DUTIES

SUBJECT
INTERNATIONAL TRADE LAW

NAME OF THE FACULTY

Saurabh Sood

Name of the Candidate

ANAMIKA
Roll No. & Semester
2013020

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ACKNOWLEDGEMENT

I would like to take this opportunity to thank MR.SAURABH SOOD for his invaluable
support, guidance and advice. I would also like to thank my friends who have always been
there to support me and last but not the least I would also like to thank the library staff for
working long hours to facilitate us with required material going a long way in quenching our
thirst for education.

ANAMIKA

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Contents
CHAPERISATION
INTRODUCTION
Rationale behind Dumping
Meaning of Anti-Dumping
Justifications for antidumping duty
ANTI-DUMPING LAW WITH SPECIFIC REFERENCE TO WTO & GATT
ANTI-DUMPING IN INDIA: INSTITUTIONAL ARRANGEMENT & EXISTING
ADMINISTRATIVE MECHANISM
LEGAL FRAMEWORK OF ANTI DUMPING IN INDIA
ANTI-DUMPING DUTIES
PROCEDURAL FORMALITIES FOR APPLYING FOR ANTI DUMPING DUTIES
REGULATORY FRAMEWORK
INTERNATIONAL CASES
1) European Communities Definitive Anti-Dumping Measures On Certain Iron
Or Steel Fasteners From China
2) European Union Anti-Dumping Measures on Certain Footwear from China
3) United States Customs Bond Directive for Merchandise Subject to AntiDumping/Countervailing Duties
INDIAN CASES
1) Designated Authority Anti-Dumping Directorate Ministry Of Commerce Vs. M/s.
Haldor Topsoe A/s.
2) Chhotu Lal Daga (Prop. of Rohit Enterprises) Vs. Commissioner of Customs
(Port)
3) Rishiroop Polymers Pvt. Ltd. Vs. Designated Authority and Additional
Secretary
CONCLUSION
BIBLIOGRAPHY
WEBLIOGRAPHY

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INTRODUCTION
Dumping, is a pricing practice where a firm charges a lower price for exporting goods than it
does for the same goods sold domestically. It is said to be the most common form of price
discrimination in international trade. Dumping can only occur at places where imperfect
competition exists and where the markets are segmented in a way such that domestic
residents cannot easily purchase goods intended for export. Antidumping duties were initiated
with the intention of nullifying the effect of the market distortions created due to such unfair
trade practices adopted by aggressive exports. They are meant to be remedial and not punitive
in nature. As a method of protection to the domestic industries, anti-dumping duties are thus
levied on the exporting country which has been accused of dumping goods in another
country. As the antidumping duty is only meant to provide protection to the domestic firms in
the initial stages, as per the international laws, the antidumping legislations may last for a
maximum period of five years. Antidumping measures are of two kinds:
Antidumping duty: This is imposed at the time of imports, in addition to other customs
duties. The purpose of antidumping duty is to raise the price of the commodity when
introduced in the market of the importing country.
Price undertaking: If the exporter himself undertakes to raise the price of the product then
the importing country can consider it and accept it instead of imposing antidumping duty.
Rationale behind Dumping
Dumping occurs when firms start using price discrimination as a strategy for profit
maximisation. The condition mandatory for dumping to take place is the presence of an
imperfect market where price discrimination between markets is possible.
Only if the above condition is satisfied is it profitable for the exporting firm to engage in
dumping. For any firm, price discrimination in favour of exports is more common because
the share of exports is usually lesser than the domestic demand. In the export market,
individual firms have lesser monopoly power and hence choose to keep prices lower in
foreign markets while charging higher prices for domestic markets. This can also be
explained through the price elasticity of demand for goods. In areas where the demand is
price inelastic, producers tend to charge a higher price. This is said to be the case in domestic

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markets. In foreign markets, price elasticity of demand is elastic and hence prices are low.
Thus, if there is high elasticity on export sales than on domestic sales, firms will dump.
Often, dumping is mistaken and simplified to mean cheap or low priced imports. However, it
is a misunderstanding of the term. Dumping implies low priced imports only in the relative
sense (relative to the normal value1), and not in absolute sense. Import of cheap products
through illegal trade channels like smuggling does not fall within the purview of antidumping measures.
Meaning of Anti-Dumping
Anti-dumping can be seen as a protective device available to the states against problems
associated with the free trade. In the recent years a large number countries have become
frequent users of anti-dumping. Many of the heaviest anti-dumping users are countries who
did not even have an anti- dumping statute a decade ago.
Anti- dumping measures are not only legal but they are also flexible in usage. Further, antidumping duties can be presented not as protection but as encounter against unfair
competition.
Justifications for antidumping duty
Anti-Dumping duties were introduced by the developed countries to protect their industries
against the low priced imports. Developing countries supported the inclusion of the provision
relating to anti-dumping duties under GATT because they wanted to levy of anti-dumping
duties to be under international regulation.
In free trade, firms are allowed to charge different rates in different markets. The result would
be that firms would charge lower prices in foreign leading to material injury to the domestic
producers in the foreign market. Had price discrimination taken place by a monopoly firm
within one economy, the government would have intervened to stop consumer exploitation by
enforcing an Act similar to the MRTP Act, in India. Hence, in the international context, it is
the antidumping duty that protects the domestic producers initially and consumers in the long
run.

1 Normal value is the price at which the like articles are sold in the Domestic
Market of the exporter.

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Usually, the intentions of charging such low prices to foreign consumers is to be able to wipe
out the domestic industries and eventually acquire monopoly power in the foreign market (i.e.
using predatory pricing). Thus it is on the ground of protecting the domestic industries that
the anti dumping duties have been justified.

ANTI-DUMPING LAW WITH SPECIFIC REFERENCE TO WTO &

GATT
The Agreement on Implementation of Article VI of the General Agreement on Tariffs and
Trade, 1994 (hereinafter referred to as the Agreement) governs the application of
antidumping measures by Members of the WTO. The provisions of the Agreement were first
negotiated during the Kennedy Round (1967) and later substantially revised during the Tokyo
Round (1979) of GATT negotiations. WTO rules allow the member countries to opt for antidumping measures with specific stipulations. If a country today has anti-dumping
legislations, it must be consistent with the agreement. Anti-dumping measures are unilateral
remedies which may be applied by a Member after an investigation and determination by that
Member, in accordance with the provisions of the Agreement, if it is felt that an imported
product is dumped and that the dumped import is causing material injury to a domestic
industry which produces a similar product. 2 The Agreement applies to trade in goods only.
Trade in services is not covered by this agreement.
The agreement contains provisions with respect to the following:
1. The Agreement sets out rules for the conduct of anti-dumping investigations,
including initiation of cases, calculation of dumping margins, the application of
remedial measures, injury determinations, enforcement, reviews, duration of the
measure and dispute settlement.
2. The Agreement provides for the right of contracting parties to apply anti-dumping
measures, i.e. measures against imports of a product at an export price below its
normal value (usually the price of the product in the domestic market of the
exporting country) if such dumped imports cause injury to a domestic industry in the
territory of the importing contracting party3.
2 Article 1
3 Article 3.5

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3. The Agreement provides for greater clarity and more detailed rules in relation to the
method of determining whether a product is dumped, the criteria to be taken into
account in determining whether dumped imports cause injury to a domestic industry,
and also the procedures to be followed in initiating and conducting anti-dumping
investigations.4 This investigation can initiate only on receiving an application,
containing the nature and extent of harm to the domestic industry being caused and
the complete description of the dumped products, from the domestic producers of the
similar product. If authorities decide to proceed to initiate an investigation, the
authorities shall notify the government of the exporting Member concerned.5
4. A new provision requires the immediate termination of an anti-dumping investigation
in cases where the authorities determine that the margin of dumping is de-minimis
(which is defined as less than 2 per cent, expressed as a percentage of the export price
of the product) or that the volume of dumped imports is negligible (generally when
the volume of dumped imports from an individual country accounts for less than 3 per
cent of the imports of the product in question into the importing country).6
5. It contains provisions relating to implementation and duration of anti-dumping
measures7. An anti-dumping duty shall remain in force only as long as and to the
extent necessary to counteract dumping which is causing injury.8 The Agreement lays
the Sunset Provision under which all anti-dumping measures shall expire five years
after the date of imposition (or the most recent review), unless a determination is
made by +the authorities that, in the event of termination of the measures, dumping
and injury would be likely to continue or recur.9 The agreement also provides for a
judicial, arbitral or administrative review for the duration such imposition.10
4 Article 6
5 Article 12
6 Article 5.8
7 Article 11
8 Id 4 Para 1
9 Id 4 Para 3
10 Article 13

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6. From many perspectives, the most significant feature of the WTO anti-dumping
framework is its dispute settlement procedure, which greatly strengthens the ability of
affected nations to challenge anti-dumping actions by other member nations. The
Agreement clarifies the role of dispute settlement panels in disputes relating to antidumping actions taken by domestic authorities. Under the WTO's DSB (Dispute
Settlement Body), a case generally has to first proceed through a panel stage, then an
appeal to the Appellate Body. The Dispute Settlement Body has to accept or reject the
Appellate Body report within 30 days and rejection is only possible by consensus.
7. 2The Agreement strengthens the requirement for the importing country to establish a
clear causal relationship between dumped imports and injury to the domestic
industry11 by evaluating all relevant economic factors related to the industry
concerned.
8. Provisions on the application of provisional measures12 are given. These measures are
applied when an investigation as per article 5 has been initiated or a preliminary
affirmative determination has been made of dumping and consequent injury to a
domestic industry
9. Provisions in respect of the use of price undertakings13 in anti-dumping cases have
been strengthened. Here proceedings may be suspended or terminated without the
imposition of provisional measures or anti-dumping duties upon receipt of satisfactory
voluntary undertakings from any exporter to revise its prices or to cease exports to the
area in question at dumped prices so that the authorities are satisfied that the injurious
effect of the dumping is eliminated.
10. The agreement provides that the provisional measures and anti-dumping duties shall
only be applied to products which enter for consumption after the time when the
decision for imposition of these measures enters into force. However, where a final
determination of injury is such that the effect of the dumped imports would, in the
absence of the provisional measures, have led to an injury to domestic producers, anti-

11 According to article 4 Domestic industry refers to the domestic producers as

a whole of the like products or to those of them whose collective output of the
products constitutes a major proportion of the total domestic production of those
products
12 Article 7
13 Article 8

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dumping duties may be levied retroactively for the period for which provisional
measures have been applied.14

ANTI-DUMPING IN INDIA: INSTITUTIONAL ARRANGEMENT &

EXISTING ADMINISTRATIVE MECHANISM
India is a founding member of the GATT and the WTO. Until the 1990s, India was not
affected by anti dumping policies as her markets were sufficiently protected by a high tariff
rate and quantitative restrictions. However, after Liberalisation in 1991, India has become a
major user of Anti dumping policies as those used by developing countries. Indias anti
dumping laws are in compliance with their WTO treaty obligations and are hence based on
the Agreement on Implementation of Article VI of GATT 1999 15. India has implemented,
rather than challenged, the existing international legal standards which were originally
drafted to serve American and European interests. In fact, despite the large numbers of
antidumping measures implemented by India, no WTO case has ever been brought against
Indias antidumping laws.16
LEGAL FRAMEWORK OF ANTI DUMPING IN INDIA
Section 9A of the Customs Tariff Act, 1975 (hereinafter referred to as the Act) as amended
in 1995 and the Customs Tariff (Identification, Assessment and Collection of Anti-dumping
Duty on Dumped Articles and for Determination of Injury) Rules, 1995 (hereinafter referred
to as the Rules) framed hereunder, form the legal basis for anti-dumping investigations and
for the levy of anti-dumping duties. These are in consonance with the WTO Agreement on
anti-dumping measures. These rules form the legislative framework for all matters relating to
14 Article 12
15Press Information Bureau, Anti-dumping checking unfair trade practices,
Available at http://pib.nic.in/focus/fomar99/wto-7.pdf
16 Mark Wu , Antidumping in Asias Emerging Giants, Volume 53, Number 1,
Winter 2012, Harvard International Law Journal

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dumping of products, which include the substantive rules, rules relating to practice,
procedure, regulatory mechanism and administration.
1. The principle of imposition of anti-dumping duties was propounded by the Article VI of
General Agreement on Tariffs & Trade (GATT) 1994 Uruguay Round
2. Indian legislation in this regard is contained in Section 9A and 9B (as amended in 1995) of
the Customs Tariff Act, 1975.
3. Further regulations are contained in the Anti-Dumping Rules [Customs Tariff
(Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and
for Determination of Injury) Rules, 1995]
4. The Ministry of Commerce, Government of India is the Designated Authority for
conducting investigations pertaining to Anti-Dumping issues and forwarding its
recommendations.
5. The responsibility for Imposition and Collection of duties as imposed /recommended by
the Adjudicating authority is upon the Ministry of Finance, Government of India.
ANTI-DUMPING DUTIES
The relief to the domestic industry against dumping of goods from a particular country is in
the form of anti-dumping duty imposed against that country, which could go up to the
dumping margin. Under the WTO arrangement, the national authorities can impose duties up
to the margin of dumping i.e. the difference between the normal value and the export price.
The Indian law also provides that the anti-dumping duty to be recommended / levied shall not
exceed the dumping margin. An anti-dumping duty imposed under the Act unless revoked
earlier remains in force for 5 years from the date of imposition. The Designated Authority by
the process of mid review is empowered to review the need for the continued imposition of
the anti-dumping duty from time to time. Such a review can be done suo-moto or on the basis
of request received from an interested party in view of the changed circumstances. 17 The
WTO Agreement as well as the Indian law provides that the injured domestic industry is
permitted to file for relief under both anti-dumping and countervailing duties. However, no
article will be subjected to both countervailing and anti-dumping duties to compensate for the
same situation of dumping.
17 Rule 23(1) of the Anti Dumping Rules

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ALTERNATIVE REMEDIES: The remedy against dumping is not always in the form of antidumping duty. The investigation may be terminated or suspended after the preliminary
findings if the exporter concerned furnishes an undertaking to revise his price to remove the
dumping or the injurious effect of dumping as the case may be. No anti-dumping duty is
recommended on such exporters from whom price undertaking has been accepted.18
INTERIM REMEDIES: An interim relief in the form of a provisional anti-dumping duty,
pending the finalization of investigation proceedings, can also be provided to the affected
domestic industry. The provisional duty can be imposed only after the expiry of 60 days from
the date of initiation of investigation and will remain in force only for a period not exceeding
6 months, extendable to 9 months under certain circumstances.19 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.20
RETROSPECTIVE ANTI DUMPING DUTIES: Anti-dumping duty can also be levied on a
retrospective basis in cases where injury is caused due to 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 antidumping 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.21
PROCEDURAL FORMALITIES FOR APPLYING FOR ANTI DUMPING DUTIES
Applications for anti- dumping protection can be made by or on behalf of the concerned
domestic industry to the Designated Authority (officer of level of Additional Secretary to the
Government of India who heads the DGAD) in the Dept. of Commerce for an investigation
into alleged dumping of a product into India. As per the regulations set by the DGAD, an
18 Rule 15 of the Anti Dumping Rules
19 Rule 13 of the Anti Dumping Rules
20 Rule 21 of the Anti Dumping Rules
21 Section 9A (3) of the Customs Tariff Act, 1975

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application for protection can be made either by an individual petitioner (domestic producer)
commanding 25% of the production capacity of the entire market or by a group of producers
who collectively hold 50% of the total market capacity.
Any industry is subject to protection if and only if there is sufficient evidence furnished by
the petitioner/s regarding;
i.Dumping of goods in question;
ii.

Injury to the domestic industry; and

iii.

A causal link between the dumped imports and alleged injury to the domestic industry.

Broadly, injury may be analysed in terms of the volume effect and price effect of the dumped
imports. Economic indicators having a bearing upon the state of industry as the magnitude of
dumping, and the decline in sales, selling price, profits, market share, production, utilisation
of capacity etc are some of the parameters by which injury to the domestic industry is to be
assessed. Existence of dumping can be estimated by calculating the dumping margin which is
the difference between the Normal Value of the like article and the export Price of the product
under consideration.
Dumping margin= Normal value- Export price
The normal value is the comparable price at which the goods under complaint are sold, in the
ordinary course of trade, in the domestic market of the exporting country or territory while
the export price of goods imported into India is the price paid or payable for the goods by the
first independent buyer.
REGULATORY FRAMEWORK
Anti-dumping, 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 Central Government may, by notification in the Official
Gazette, appoint a person not below the rank of a Joint Secretary to the Government of India
or such other person as that Government may think fit as the Designated Authority.22

22 Rule 3 (1)

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The Designated Authority is a quasi-judicial authority notified under the Customs Act, 1962
which is designated to initiate necessary action for investigations and subsequent imposition
of anti-dumping duties.23 A senior level Joint Secretary and Director, four investigating
officers and four costing officers assist the DGAD. Besides, there is a section under the
DGAD headed by the Section-Officer to deal with the monitoring and coordination of the
functioning of the DGAD.
The Designated Authoritys function, however, is only to conduct 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 levied by a
Notification of the Ministry of Finance.
The law provides that an order of determination of existence, degree and effect of dumping is
appealable before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT),
formerly the (Customs, Excise and Gold (Control) Appellate Tribunal (CEGAT)) a judicial
tribunal, within 90 days. It reviews final measures and is independent of administrative
authorities. This is consistent with the WTO provision of independent tribunals for appeal
against final determination and reviews.
However, many petitions are also filed before the High court (under Article 226 of the
Constitution) and also the Supreme Court of India. Due to large pendency in both these
courts, it causes disruptions in trade during the interim period. Thus there have been demands
for a specially designated bench in the Supreme Court for this purpose.24

INTERNATIONAL CASES

23 Though the WTO Agreement does not require the authorities for dumping and injury
determination to bedistinct and separate, national practices in this respect van`.
Generally, while the developing countries have
single authority to deal with both dumping and injury, developed countries like the US,
Canada and the EU
have elaborate anti-dumping machinery

24 Raju, K. D., World trade Organization Agreement on Anti-dumping, Wolter

Kluwer Law & Business Series, Aspen Publishers, Inc., p. 233

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1) European Communities Definitive Anti-Dumping Measures On Certain Iron Or

Steel Fasteners From China25
On December 4, 2008, within the European Union, 15 members were in favor and 12 votes
were against the adoption of imposing a five-year average of 80 percent anti-dumping duties
on the screw and nut products from China. In 2009, the EU decided to impose anti-dumping
duties of up to 87 percent for the next five years on fasteners imported from China and
required Chinese exporters to prove that they meet with the single duty requirements when
they responded to anti-dumping cases, bringing a heavy burden and unfair treatment to
Chinese companies.
On January 28, 2009, the Ministry of Commerce spokesman Yao Jian made a speech on the
EU's final decision regarding anti-dumping measures on China's export of fasteners. Yao said
the Chinese government and industries had expressed strong dissatisfaction and that there
were many discrepancies in the European Union's case filing, investigation and adjudication
process with regard to WTO rules. He added that the EU anti-dumping practice, lacking
fairness and transparency, leaned towards trade protection, which greatly hurt the legitimate
rights of Chinese fastener enterprises. China resorted to the WTO to resolve the issue.
FINDINGS OF THE PANEL
The WTO set up an expert panel on Oct 23, 2009 after China initiated the WTO case on July
31, 2009. On July 15, 2011, the WTO issued a final ruling on the case concluding that the
section 5, Article 9 of the EU Anti-dumping Law against China was in violation of WTO
rules; the anti-dumping measures taken against Chinese fastener by the European Union in
January 2009 were contrary to the provisions of the WTO Anti-Dumping Agreement, and that
the EU should withdraw the anti-dumping order. The WTO ruled the EU's single duty
requirements and practices are discriminatory and violated WTO rules.

2) European Union Anti-Dumping Measures on Certain Footwear from China26

The shoe dumping case was the second brought by China against the EU at the WTO. China
launched the shoe case in February 2010 after the EU decided to extend the duties on shoes
25 DISPUTE DS397
26 DISPUTE DS405

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from China and Vietnam, after shoemakers in Spain and Italy complained they could not
compete against the cheap imports. The duties also faced opposition within Europe, since
they forced consumers to pay more for their shoes. The Federation of the European Sporting
Goods Industry, whose members include companies such as Adidas, Puma and Nike,
launched a legal case against the European Union complaining they had suffered losses as a
result of the duties on shoes from China and Vietnam.
FINDINGS OF THE PANEL
The WTO dispute panel largely backed the complaint by China that anti-dumping duties
imposed by the European Union (EU) on certain leather footwear imports breached global
rules and held that the anti-dumping duties were inconsistent with the EU's obligations under
the WTO and that some aspects of the original investigation and expiry review were out of
step with the anti-dumping agreement.
The WTO panel also upheld China's challenge to the EU's method for calculating the antidumping duties, saying the EU's approach systematically produced a result which punished
normal pricing behaviour. It also concluded that the EU calculated and imposed the antidumping duties in a way which impermissibly discriminated against the vast majority of
Chinese suppliers solely because they were Chinese, thus violating the cornerstone nondiscrimination provision of the WTO Agreement.

3) United States Customs Bond Directive for Merchandise Subject to AntiDumping/Countervailing Duties27
The US Southern Shrimp Alliance (SSA) an alliance of eight southern coastal States
representing the harvesters, processors and distributors of US wild caught shrimp, filed a
petition in 2003 in the US Department of Commerce (DOC) and the US International Trade
Commission (ITC). The petitioners alleged that the exporters from Thailand, China, Vietnam,
India, Brazil and Ecuador were selling shrimp at lower prices than in their home markets and
were materially injuring the domestic industry in the US. This they justified by showing the
sudden drop in the harvest by more than half from $1.25bn in 2000 to $560mn in 2002. In
short, they alleged that these countries are dumping their shrimps in the US market.
27 DISPUTE DS345

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Under a 1991 Customs Bond Directive, the US required importers subject to antidumping
action to post a custom bond equivalent to the greater of US$50,000 or 10 percent of the
duties paid during the preceding year. As per a 2004 US Customs and Border Protection
enactment, (the Enhanced Bond Requirement, or EBR) exporters were additionally required
to post a minimum bond equivalent to the anti-dumping duty margin, multiplied by the value
of imports of shrimp in the preceding year as well as pay cash deposit equal to the amount of
anti-dumping duty per entry. India also claimed that in order to post these bonds, the shrimp
exporters had to put up a surety equivalent to the bond amount to the banks that financed the
bonds. Apart from causing excessive financial burden on exporters paying the anti-dumping
duties, this enhanced bond requirement was claimed to be illegal since WTO rules do not
allow an importer to counter dumping with specific measures besides antidumping duties.
In January 2005, ITC confirmed the US DOCs determination and slapped anti-dumping
duties equal to dumping margins (i.e. by how much the normal value price exceeds the export
price) on non-canned shrimp that the DOC calculated to range from 2.35 percent to 67.8
percent for Brazil, Ecuador, India and Thailand; up to 25.76 percent for Vietnam; and up to
112.81 percent for China. Although the above tariffs were not as high as the Alliance had
requested (up to 200 percent), they hailed this decision.
On 6 June 2006 India requested separate consultations with the US on the amended bond
directive and the EBR imposed by the US on imports of frozen warm water shrimp from
India.
In its request, India claimed that the measures under the amended directive were in violation
of the WTO ADM as well as the GATT. However this consultation also failed to resolve the
dispute and subsequently the DSB established another separate panel allowing Brazil, China,
European Communities, Japan and Thailand to act as third parties.
The main issues in these disputes were that the imposition of EBR and application of the
practice known as zeroing by the US on importers of shrimp products from India were
inconsistent with WTO agreements. In the absence of an agreement between the parties, the
WTO Director- General composed a three member Panel. The Panel issued the Interim
Report to the parties on 9 October 2007 and the Final Report to the parties on 13 November
2007.
FINDINGS OF THE PANEL

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In its findings, the three member panel held that the applications of EBR on Indian shrimp
exports were inconsistent with the rules of the WTO Anti-dumping Agreement as well as the
GATT and due to this bond, the Indian shrimp exporters had to incur prohibitive costs on
their exports. Further on, it held that the US violated both the Anti-dumping and the Subsidies
and Countervailing Measures (SCM) Agreement because it failed to notify the amended
Custom Bond Directive to the Anti-dumping and SCM Committees.
Also, it was concluded that the use of zeroing by the US breached US obligations under the
Anti-dumping Agreement for the reason that the US did not calculate dumping margins on
the basis of the product as a whole. Consequently, the panels conclusion and
recommendation was that the US had to bring its measures into conformity with its
obligations under the WTO Anti-dumping Agreement and the GATT 1994.

INDIAN CASES
1) Designated Authority Anti-Dumping Directorate Ministry Of Commerce Vs. M/s.
Haldor Topsoe A/s.28
FACTS
Catalysts were imported from Denmark. A complaint of dumping was lodged with the
designated authority. The designated authority undertook to cause investigation. However, the
exporter did not furnish information about the export price of the catalyst to the other third
countries when no domestic sales were made in them.
The exporter insisted that normal price be determined on cost of production basis. The
authority rejected this. The designated authority, instead, proceeded to rely upon the price of
like catalyst sold by a German manufacturer. On this basis, the designated authority gave its
finding and recommended imposition of anti-dumping duty. It recommended two rates,
depending upon the end-use of the catalysts in India.
28 AIR2000SC2556

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The exporter challenged the finding in appeal to the tribunal. It was argued that the antidumping duty is country-specific and exporter-specific and therefore, the price of the German
exporter cannot be relied upon. The tribunal accepted the argument of the appellant. The
tribunal concluded that the action of the designated authority is clearly in violation of the
specific provisions contained in section 9A of the Act.
Even though the appellant did not co-operate to provide the information, the tribunal refused
to be persuaded to recognize the price of another exporter for like article. According to the
tribunal, it was wrong for the Central Government to extend the time of one year for
completing the investigation, without providing an opportunity to the appellant.
Yet another question was agitated in appeal. Was it legal to recommend two rates of antidumping duty for the same product? The tribunal answered the question in the negative,
saying, We are not able to up hold the action of the designated authority.
The designated authority decided to contest the order of the tribunal in the Supreme Court.

JUDGEMENT
The judgment of the apex court set aside the order of the tribunal on more than one count. On
the basic question whether reliance upon the price of the other exporter falls within the
domain of correctness, the Supreme Court reversed the finding of the tribunal. The court
rejected the theory of exporter-specific or country-specific argument. The court observed:
By holding anti dumping duty to be exporter-specific, the tribunal could not have restricted
the scope of the investigation only to materials to be produced by a party against whom an
investigation is being conducted. Such an interpretation of the statute is wholly contrary to
the very scheme of the statute.
It felt that the legal provisions did not call for any doubt or confusion.
On a careful reading of section 9A of the Tariff Act and Rule 6 of the rules, it is clear that
the statute has no where put such a restriction on the investigating authority. On the contrary,
the perusal of the said provisions clearly shows that the normal value will have to be
determined with reference to comparable price, the word comparable price in the context can

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only be with reference to the price of similar articles sold under similar circumstances
irrespective of the manufacturer.
The apex court rejected the tribunal's finding on the question of two different rates of antidumping duty. The Supreme Court observed that the tribunal did not give any specific reason
why the two different margins cannot be made applicable based on different import duties
applicable to the concerned catalyst.

2) Chhotu Lal Daga (Prop. of Rohit Enterprises) Vs. Commissioner of Customs (Port)29
FACTS
Central Government imposed anti-dumping duty on Compact Fluorescent Lamps (CFL)
originating in or exported from China under Notification No. 128/2001-Cus. dated
21.12.2001. Imposition of anti-dumping duty was made on a provisional basis pending final
determination and such provisional duty was effective up to and inclusive of 20.06.2002. The
Notification provided for separate anti-dumping duty on CFL without choke and with choke.
The same Notification also imposed anti-dumping duty on CFL without choke originating in
or exported from Hong Kong. Subsequently, definitive anti-dumping duty was imposed by
Notification No. 138/2002-Cus. dated 10.12.2002. The anti-dumping duty on CFL with choke
originating in or exported from Hong Kong was imposed for the first time under Notification
No. 138/2002. The appellant imported the impugned CFL with choke of Chinese origin from
a supplier in Hong Kong. The bill of entry was noted on prior entry basis on 02.12.02 and the
vessel carrying the said goods was granted Entry Inwards on 09.12.2002. The main issue in
dispute in this case is whether the anti-dumping duty is payable on such imports made during
the interregnum, i.e., between 21.06.2002 and 09.12.2002, after the provisional duty lapsed
but before the definitive duty was notified.
JUDGEMENT
The Supreme Court noted that ...the erstwhile GATT and its successor WTO, through multilateral negotiations, have been bringing down tariff barriers and liberalising international
trade. However, to prevent unfair trade under liberalised trading systems, WTO has
mandated trade remedy measures such as anti-dumping duty against dumped imports,
29 2008(120)ECC277

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countervailing duty against subsidized imports and safeguard measures against surge in
imports. Such measures are necessary to prevent unfair trade by foreign suppliers to the
detriment of domestic industry in the absence of a protective import tariff wall. That antidumping duty is not so much of a revenue measure, is evident from the fact that some of the
WTO member-countries have made provisions for making payments from the collected antidumping duty to the injured domestic industry.
The appellant contended that since the import has taken place from a supplier in Hong Kong,
in terms of paragraph 2 of the Notification No. 138/2002, the anti-dumping duty for CFL with
choke exported from Hong Kong, should be charged only with effect from the date of the
Notification i.e. 10.12.02. The Supreme Court rejected this contention. In the case of the
appellant, the goods were of Chinese origin and hence, these satisfy the condition of
'originating in, or exported from China', notwithstanding the fact that they were re-exported
from Hong Kong. Since the anti-dumping duty in respect of CFL with choke originating in,
or exported from China was levied from 21.12.2001, thus impugned import made by the
appellant had to pay the anti-dumping duty notified under Notification No. 138/2002.
The Appellant also pleaded that the quantum of anti-dumping duty was very high and he was
not in a position to pay the same. Rejecting his contention, the court held that ...one of the
purposes of levying anti-dumping duty on a provisional basis for a period of six months on
preliminary determination is to make aware all exporters and importers concerned regarding
the initiation and continuance of anti-dumping investigation against dumped imports from
specific countries/exporters... In any case, the purpose of anti-dumping duty is to remove the
injury caused by dumped imports...the plea that the anti-dumping duty is excessive and that
the same cannot be borne by the importer, cannot be a basis for not demanding it from the
subject imports.
3) Rishiroop Polymers Pvt. Ltd. Vs. Designated Authority and Additional Secretary 30
FACTS
he Appellant was the sole agent of Acrylonitrile Butadiene Rubber [for short "NBR"] as
manufactured by Korea Kumho Petrochemicals Limited [for short "KKPC"].

30 (2006) 4 SCC 303 : MANU/SC/1451/2006

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The subject goods were being imported into India for near about a decade. The subject antidumping duty proceedings were related to NBR 31 which was a synthetic rubber mainly used
in the manufacture of other rubber articles such as oil seals, hoses, automobile product, rice
dehusking rolls etc.
Gujarat Apar Polymers Ltd. (GAPL), hereinafter referred to Respondent No. 3, were the
manufacturers of some grades of NBR. Respondent No. 3 by means of complaint dated
3.11.1995 addressed to the Additional Secretary being the designated authority under Section
9 of the Tariff Act in the Ministry of Commerce, stated that the import of bales of the said
consignment from Germany was causing injury to its productions. Proceedings were initiated
by the Public Notice dated 1.3.1995 against export of NBR from Germany and Korea. The
period of investigation was 1.10.1994 to 31.3.1995.
The designated authority after considering the entire data of facts came to the conclusion that
1) NBR originating in or exported from Germany and Korea had been exported to India
below its normal value;
2) Consequently, the domestic industry had suffered material injury;
Thus, anti dumping provisions were imposed and the designated authority confirmed its
preliminary finding dated 3012.1996.
In 2001, the designated authority received requests for Mid-term review of the dumping
provisions carried out under Rule 23 of the Rules. The Authority concluded that the domestic
industry, during the review period of investigation, had faced injury due to continued
dumping by the plaintiff despite anti dumping measures. Thus, the authority recognized the
need for continuation of imposition of definitive anti dumping duty on all imports of SB.
Additionally, the authority also turned down the appellants request for a Sunset review on
the same grounds that the dumping of the subject goods is continuing from the subject
countries and thus domestic industry was suffering material injury; Further, the authority also
observed that the material injury to the domestic industry would intensify if anti-dumping
duty is removed.

31 NBR is a generic term and has various grades and physical forms.

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The designated authoritys decision was challenged by the appellant that all the 14 parameters
given in Para (iv) of Annexure-II relating to principles of determination of injury were
required to be determined but had not been taken into account and that only some of the
parameters were considered.
JUDGEMENT
The Supreme Court, while rejecting the appellants contention, held that the review enquiry
should be limited to see as to whether the conditions which existed at the time of imposition
of anti-dumping duty have altered to such an extent that there is no longer justification for
continued imposition of the duty. The Supreme Court held that the enquiry was limited to the
change in the various parameters like the normal value, export price, dumping margin,
fixation of non-injurious price and injury to domestic industry. The said enquiry had to be
limited to the information received with respect to change in various parameters. It was said
that the entire purpose of the review enquiry is not to see whether there is a need for
imposition of antidumping duty but to see whether in the absence of such continuance
dumping would increase and the domestic industry suffer. It was also held that final findings
recorded by the designated authority at the time of initial imposition of anti-dumping duty on
the existence of injury to the domestic industry must be considered to continue to remain
valid, unless it is proved to be otherwise, either by the designated authority in suo moto
review or by the applicant seeking the review.
The Supreme Court further observed that in the absence of new material, the designated
authority was not required to apply afresh parameters or criteria enumerated in paragraph (iv)
of Annexure II, which had already been done at the initial stage of imposition of antidumping duty.
In the current case, the Designated Authority in its findings in the Mid Term Review
proceedings and also the Sunset review proceedings had categorically stated that all the
factors have been taken into consideration while determining continuance of the antidumping duty. Thus it was held that the argument of the appellant that all relevant factors
have not been considered had no factual foundation.
4
the role of dispute settlement panels in disputes relating to anti-dumping actions taken
by

P a g e | 23

domestic authorities. On the methodology for determining that a product is exported at a

dumped
price, the new Agreement adds relatively specific provisions on such issues as criteria
for
allocating costs when the export price is compared with a 'constructed' normal value and rules
to
ensure that a fair comparison is made between the export prices and the normal value of a
product
so as not to arbitrarily create or inflate margins of dumping."
Despite this positive self-assessment about the refinements of antidumping related provisions
in WTO, it is only easy to find opinions that express concerns about shortcomings of the
current
WTO provisions on antidumping, like in Baldwin (1999), Finger et al. (2000),
Blonigen and
Prusa (2001). Because Baldwin (1999) makes most explicit and detailed suggestions
as well as
criticisms on the current antidumping provisions of WTO, I summarize them as follows:
Criticisms
a)
No general efficiency basis for opposing the sale of a product at a lower price abroad than a
home or at a price below average costs.
The case for antidumping provisions on economic efficiency grounds is based on
predatory pricing, but such a case is almost impossible to find among AD cases.
b)

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The modification of existing dumping rules to include the

cumulation requirement.
Cumulating imports across countries as opposed to a country-by-country basis in
determining injury makes affirmative injury findings more likely to happen.
c)
Introduction of a standard review for dispute settlement panels in AD cases that
makes it
very difficult to overturn an AD decision by a national government.
Suggestions
a)
Introducing the competition policy that eliminates need for AD provisions.
The best long-run solution for curbing the misuse of the AD provisions of WTO.
5
b)
Requiring the level of antidumping duties or price increase under price undertakings
be no
higher than necessary to remove the injury to the domestic industry and in no case
higher
than the margin of dumping. (The current WTO provisions state only that "it is desirable.")
Since WTO dumping provisions condemn dumping only if it causes material injury, it

P a g e | 25

seems appropriate that any remedial action be sufficient only to remove the injury.
c)
Permitting below-costs sales under certain circumstances.
In the presence of strong learning-by-doing effects, below-cost sales should be
regarded
as a part of normal business practices. For the circumstances where a domestic firm
would be allowed to have below-costs sales, thus, foreign firms also should be permitted
to do so.
d)
Comparing the "cost margin" with the dumping margin.
In the case where the price gap between the foreign and the domestic markets
(dumping
margin) is greater than the cost margin of shipping the product back to the foreign
market, then it may be that the domestic industry is using the antidumping laws to
enforce a cartel-like price agreement with foreign producers. If the cost margin is less
than the dumping margin, then the corresponding AD measures should only remove
the
injury related to this cost margin.
e)
Establishing a monitoring system (by the administering authorities) aimed at ensuring
that
any price increases following the imposition of AD duties or a suspension agreement are no

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greater than necessary to restore the domestic price to its pre-dumping level.

CONCLUSION
Today large numbers of countries have become frequent users of anti-dumping measures.
Anti-dumping has unique combination of political and economic manipulability. During the
last fourteen years of WTO, the use of anti- dumping has become rampant that it is criticized
as threatening to limit the market access achieved under GATT/WTO trade negotiations over
the last fifty years or so. On the one hand, there is fear that anti dumping measures are used
for protectionist purpose. On the other hand, many support it because it can be used as
encounter against unfair trade practices.
It has been seen that Anti dumping policies are being initiated mostly by major players in the
business. These dominants producers lobby and litigate antidumping cases. In the process,
they incur huge expenditure sacrificing economic efficiency. Thus, antidumping policies that
are designed to ensure fair competition and improve economic efficiency may in fact reduce
them. To minimise the manipulation of the law for protectionist purpose and to limit
discretionary powers of the authorities, more explicit rules should be developed and
definitions of different concepts used in the process should be given clearly and the procedure
of determining dumping should be made more transparent.

BIBLIOGRAPHY
1. Aggarwal, Aradhna., The anti-dumping agreement and developing countries, Oxford

University Press, (New Delhi : | New York )

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2. Raju, K. D., World trade Organization Agreement on Anti-dumping, Wolter Kluwer Law
& Business Series, Aspen Publishers, Inc.

WEBLIOGRAPHY

1. Mark Wu , Antidumping in Asias Emerging Giants, Volume 53, Number 1, Winter 2012,
Harvard International Law Journal, Available at www.harvardilj.org/2012/01/issue_53-1_wu/
2. www.cci.gov.in/