06 Jul 2011

Streamlining Australia's anti-dumping system

by Michael Mulgrew

The changes to Australia's anti-dumping system will encourage more domestic industries to lodge dumping and subsidy applications.

The Australian Government announced a number of changes to Australia's anti-dumping laws on Wednesday June 22, 2011.

The reforms are expected to be implemented over the next six to 18 months.

Mr Brendan O’Connor, Minister for Home Affairs and Justice, and Dr Craig Emerson, Minister for Trade, said in the announcement that the new laws are designed to combat dumping, and to support local jobs.

The Government's reforms of the anti-dumping system are based on the recommendations of the Productivity Commission anti-dumping report which was tabled last year.

A Private Members Bill tabled by Senator Nick Xenophon, submissions from State and Territory governments and various other stakeholders were also taken into account.

The Government has accepted, either in full or in part, 15 of the 20 recommendations made in the Productivity Commission's anti-dumping report.

The Government believes that the reforms will reduce costs incurred by Australian businesses seeking action against dumping, as well as improving efficiency and transparency for all parties involved in anti-dumping investigations.

The Government is expecting the following results from the reforms

Improved efficiency is expected through:

  • A 45 percent increase in Customs staff working on anti-dumping issues over the next 12 months to ensure cases are dealt with more efficiently
  • Introducing provisional measures at an earlier opportunity to remedy the negative effects of dumping sooner
  • Introducing a 30-day time limit for Ministerial decisions on anti-dumping cases.

Stronger compliance is expected through:

  • A dedicated resource within Customs to boost monitoring of measures to ensure compliance.
  • Combating attempts to circumvent anti-dumping duties.

Improved decision making is expected through:

  • The greater use of trade and industry experts in investigating complaints.
  • The introduction of a more rigorous appeals process supported by more resources.
  • Clarifying the list of injury factors that can be claimed by domestic industry, and clarifying Customs' approach to injury determinations.
  • Providing flexibility in allowing extensions of time to complete complex cases.

Better access to the anti-dumping system is expected through:

  • The appointment of a new Support Officer to help small/medium businesses, downstream manufacturers and producers to actively participate in anti-dumping investigations.
  • Improving access to imports and subsidies data, and clarifying the data requirements for making an application.
  • Clarifying the parties who can participate in investigations to include relevant industry associations, unions and downstream industry.
  • Providing a more flexible basis for parties wishing to seek a review of existing measures.
  • Greater consistency with other countries through:
  • Regular consideration of the practices and decisions of other countries
  • Allowing Australian companies to combat a wider range of subsidies.
  • The establishment of the International Trade Remedies Forum, which will work with Government to oversee the implementation of the reforms.

Commentary

While the Government response to the Productivity Commission report appears to have been delayed, the time taken reflects the importance of the attempts to be fair not only to the needs of the domestic industry but also of exporters.

The changes that are being proposed are substantial and will result ultimately in more domestic industries being encouraged to lodge dumping and subsidy applications.

The Government commitment to reject the WTO inconsistent nature of many of the proposals contained in the private bill is to be commended.

The new appeals process

The proposed new appeal process is a considerable improvement to the existing system which has suffered from the fact that any recommendation has simply been referred back to Customs, which in the vast majority of cases reaffirmed the previous decision.

The rejection of the bounded public interest test will be a matter of controversy with those affected, and although the door has been left open to possible consideration by the Minister, it is difficult to imagine that a public interest test will be used.

The reforms allowing more formal representation in dumping and subsidy investigations expands the definition of an "interested party". This assists those involved to obtain import statistics, as well as allowing a greater use of external consultants.

This should be welcome news to all parties involved.

International Trade Remedies Forum

This forum will have to give consideration to a range of sensitive issues. One of the main issues will be the question of how the Government will proposes to improve the effectiveness of Australia’s “particular market situation” provisions, consistent with World Trade Organization obligations.

This will remain an area of ongoing controversy.

The new reforms highlight the complexity of the law and practice in bringing and defending dumping cases. The expense and time involved in the process can be frustrating to all.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.