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Customs Tariff (Anti-Dumping) Amendment Bill (No. 1) 2012

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2010-2011-2012

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

HOUSE OF REPRESENTATIVES

 

 

 

CUSTOMS TARIFF (ANTI-DUMPING) AMENDMENT BILL (No. 1) 2012

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Home Affairs,

the Honourable Jason Clare MP)

CUSTOMS TARIFF (ANTI-DUMPING) AMENDMENT BILL (No. 1) 2012

 

OUTLINE

1.      The purpose of this Bill is to amend the Customs Tariff (Anti-Dumping) Act 1975 (the Dumping Duty Act) to further implement the Government’s reforms to Australia’s anti-dumping system announced in June 2011.

2.      This Bill, as per the Streamlining policy, will amend the Dumping Duty Act to allow the Minister to use different forms of interim dumping duty from those currently used.  The forms of interim dumping duty which the Minister will be able to use will include an ad valorem (percentage) duty, a fixed amount of duty, a combination duty, or a floor price.  Currently, the Minister can only use a combination form of interim dumping duty which has a fixed component and a variable component.

3.      These new forms of interim dumping duty, including the existing form of interim dumping duty currently contained in the Dumping Duty Act, will be prescribed as a consequence of this Bill in the new regulations to be prescribed under section 22 of the Dumping Duty Act.

4.      The WTO Anti-Dumping Agreement (ADA) does not mandate the method for calculating the level of duties.  Article 9.2 requires the duty to be of an appropriate amount and levied in a ‘non-discriminatory manner on imports of such product from all sources found to be dumped and causing injury, except as to imports from those sources from which price undertakings’ have been accepted.

FINANCIAL IMPACT STATEMENT

5.      The Australian Government has provided $10.4 million over the forward estimates to be absorbed by Australia’s Customs and Border Protection Service (Customs and Border Protection) for the implementation of the June 2011 reforms to the anti-dumping system of which this Bill forms part.

REGULATION IMPACT STATEMENT

6.      Section 4 (Regulation Impact Statement) of the Explanatory Memorandum of the Customs Amendment (Anti-dumping Improvements) Bill (No. 2) 2011 contains the regulation impact statement for this Bill.



HUMAN RIGHTS COMPATIBILITY STATEMENT

7.      This Human Rights Compatibility Statement was prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

8.      This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in the definition of human rights in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

Overview of the Bill

9.      The purpose of this Bill is to amend the Dumping Duty Act to make it easier to understand and less complex.

10.   The Dumping Duty Act deals with the imposition of duties.

11.   This Bill implements aspects of the Government’s reforms to Australia’s anti-dumping system announced in June 2011.  This is the third tranche of these reforms. 

12.   The Customs Tariff (Anti-Dumping) Amendment Bill (No. 1) 2012 will amend the Dumping Duty Act by allow the Minister to utilise additional forms of interim dumping duty beyond the single form that is currently provided for.  The new forms of duty are:

12.1     an ad valorem (percentage) duty;

12.2     a fixed amount of duty; and

12.3     a floor price mechanism.

Human Rights implications

13.   This legislative instrument does not engage, impact on, or limit in any way, the human rights and freedoms recognised or declared in the international instruments listed in the definition of human rights at section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

Conclusion

14.   This legislative instrument does not raise any human rights issues.

Minister for Home Affairs



CUSTOMS TARIFF (anti-dumping) AMENDMENTS BILL (n0. 1) 2012

NOTES ON CLAUSES

Clause 1 - Short title

15.   This clause provides for the Bill, when enacted, to be cited as the Customs Tariff (Anti-Dumping) Amendment Act (No. 1) 2012.

Clause 2 - Commencement

16.   Subclause (1) provides that each provision of this Act specified in column 1 of the table in that subclause commences, or is taken to have commenced, on the day or at the time specified in column 2 of the table. This subclause also provides that any other statement in column 2 of the table has effect according to its terms.

17.   Item 1 in column 1 of the table provides that sections 1 to 3 and anything in this Act not elsewhere covered by the table will commence on the day on which the Act receives the Royal Assent. 

18.   Item 2 in column 1 of the table provides that Schedule 1 commences on a day to be fixed by Proclamation and if any of the provisions do not commence within 6 months beginning on the day the Act receives the Royal Assent, they commence on the day after the end of that period.

Clause 3 - Schedule

19.   This clause is the formal enabling provision for the Schedule to the Bill, providing that each Act specified in a Schedule is amended in accordance with the applicable items of the Schedule.  In this Bill, the Customs Tariff (Anti-Dumping) Act 1975 is the only Act being amended.

20.   The clause also provides that the other items of the Schedules have effect according to their terms.  This is a standard enabling clause for transitional, savings and application items in amending legislation. 



Schedule 1 - AMENDMENTs of THE CUSTOMS tariff (anti-dumping) ACT 1975

Imposing different forms of interim dumping duty

21.   This Bill, in line with the Australian Government’s June 11 Streamlining the anti-dumping system policy, will amend the Dumping Duty Act to allow the Minister to utilise additional forms of interim dumping duty to the single form that is currently provided for.  Currently the Dumping Duty Act only provides for the imposition of a combination form of interim dumping duty that has a fixed component and a variable component.

22.   The form of interim dumping duty is the method of working out the amount of interim dumping duty payable on goods the subject of notices under subsection 269TG(1) or (2) and subsection 269TH(1) or (2) of the Customs Act 1901 (Customs Act) (dumping duty notices). 

23.   Interim dumping duty is assessed and paid on each entry of goods the subject of a dumping duty notice.  Importers may subsequently apply for a dumping duty assessment pursuant to Division 4 of Part XVB of the Customs Act, within six months after of the particular importation period.  If the final duty assessed is less than the interim dumping duty paid, then a refund is paid.  If the final duty assessed is more than the interim dumping duty paid, then the excess is waived.  Importantly, if none of the goods are dumped during the relevant assessment period, then all of the interim duty paid will be refunded.  This Bill does not alter the methods for determining the final duty, or the assessment and refund process.  It only allows more options for the Minister in imposing the interim dumping duty payable.

24.   The ADA does not mandate the method for calculating the level of duties. Article 9.2 requires the duty to be of an appropriate amount and levied in an ‘non-discriminatory manner on imports of such product from all sources found to be dumped and causing injury, except as to imports from those sources from which price undertakings’ have been accepted.

25.   This Bill provides that the different forms of interim dumping duty will be prescribed in the Regulations.  The current combination duty will be removed from the Dumping Duty Act and will also be prescribed in the Regulations.  The Minister will determine which of those prescribed methods will be used for each dumping duty notice by a signed notice, which will be published.

26.   The new forms of duty to be prescribed in the Regulations:

26.1     an ad valorem (percentage) duty;

26.2     a fixed amount of duty; or

26.3     a floor price mechanism.

Item 1 - Subsections 8(4) to (5B)

27.   This item repeals the present subsections 8(4) to (5B) to remove the current form of interim dumping duty from the Dumping Duty Act, and substitutes new subsections 8(5) to (5BE).

Calculation of interim dumping duty

28.   New subsection 8(5) requires the Minister to determine, by signed notice, that the interim dumping duty payable on goods the subject of a notice under subsections 269TG(1) or (2) of the Customs Act is an amount worked out in accordance with a specified method.  That method must be one of the methods that will be prescribed in the Regulations as provided by subsection 8(5BB).  At least one subsection 8(5) notice will have to be issued in respect of each dumping duty notice.  It is by the use of these notices that the Minister will choose from the prescribed methods for imposing interim dumping duty.

Notice has effect accordingly

29.   New subsection 8(5A) provides for a notice under subsection 8(5) to have effect accordingly.

Principles to be followed in specifying method of calculation

30.   New subsections 8(5B) and (5BA) replace the present subsections 8(5A) and (5B), and are designed to ensure that the Minister considers imposing a lesser duty, consistent with Article 8.1 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (the Dumping Agreement), which is known as the “lesser duty rule”.  These new subsections were considered necessary due to the removal and replacement of the present subsection 8(5), but have exactly the same intended effect.

31.   Article 8.1 of the Dumping Agreement states that it “…is desirable that … the [dumping] duty be less than the margin [ie the normal value of the goods - export price of the goods], if such lesser duty would be adequate to remove the injury to the domestic industry.” 

32.   New subsection 8(5B) replaces the present subsection 8(5A).  The new subsection operates in the same circumstances as the present subsection 8(5A), and is to the same relevant effect.  Under the new subsection, if a dumping duty notice has been issued under subsection 269TG(1) or (2) of the Customs Act and the non-injurious price as last ascertained is less than the normal value as last ascertained, the Minister must have regard to the desirability of specifying a method of imposing interim dumping duty so that the sum of the ascertained export price and the interim dumping duty does not exceed the ascertained non-injurious price.  

33.   New subsection 8(5BA) replaces the present subsection 8(5B).  The new subsection operates in the same circumstances as the present subsection 8(5B).  Under the new subsection, if  a dumping duty notice has been published under subsections 269TG91) or (2) of the Customs Act, and a countervailing duty notice has been published under section 269TJ in respect of the same goods at the same time, then the Minister must have regard to the desirability of specifying a method of imposing interim dumping duty so that the sum of the ascertained export price and the interim dumping duty and the interim countervailing duty does not exceed the ascertained non-injurious price.

34.   The new paragraph 8(5BA)(c) refers to ‘export price of goods of that kind as so ascertained or last so ascertained‘ instead of the ‘export price of those particular goods’ as per paragraph 8(5B)(a).  This is because reference to ‘export price of those particular goods’ was an error.  It is impossible to set the interim dumping duty at a rate that ensures that the future export price of goods (which would be unknown at the time of setting the measures) plus the interim duty will not exceed the non-injurious price as last ascertained.  It is only possible to set interim duty rates that ensure that the sum of the (known) export price as ascertained or last ascertained for the purposes of the notice(s) plus the relevant interim duty or duties, does not exceed the (known) non-injurious price as ascertained or last ascertained for the purposes of the notice(s).

Methods available for calculating interim dumping duty

35.   New subsection 8(5BB) requires the methods for working out the form of interim dumping duty to be prescribed in the Regulations.

36.   New subsection 8(5BC) requires those methods to refer to one or more of the following:

36.1     the export price of the goods the subject of the notice under subsection 269TG(1) or (2) of the Customs Act;

36.2     the export price of goods of that kind as ascertained, or last ascertained, by the Minister for the purposes of the notice;

36.3     the normal value of goods of that kind as ascertained, or last ascertained, by the Minister for the purposes of the notice;

36.4     the non-injurious price of goods of that kind as ascertained, or last ascertained, by the Minister for the purposes of the notice.

(The export price, normal value and non-injurious price are provided for by sections 269TAB, 269TAC and 269TACA respectively of the Customs Act.)

37.   New subsection 8(5BD) allows for the methods to refer to the export price of goods the subject of the notice, as ascertained by the Minister.

38.   New subsection 8(5BE) provides that subsection 8(5BC) does not limit the matters that may be referred to in the methods, so as to avoid any doubt.

Items 2 - Before subsection 8(5C)

39.   This item amends the Dumping Duty Act to provide for an appropriate title to subsection 8(5C) which describes this provision’s function but does not alter it.

Items 3 - Before subsection 8(5D)

40.   This item amends the Dumping Duty Act to provide for an appropriate title to subsection 8(5D) which describes this provision’s function but does not alter it.

Item 4 - Before subsection 8(6)

41.   This item amends the Dumping Duty Act to provide for an appropriate title to subsection 8(6) which describes this provision’s function but does not alter it.

Item 5 - Paragraph 8(6)(b)

42.   This item amends paragraph 8(6)(b) to add clarity to the Dumping Duty Act by removing a redundant reference to a section 8(5) notice.

Item 6 - Before subsection 8(7)

43.   This item amends the Dumping Duty Act to provide for an appropriate title to subsection 8(5D) which describes this provision’s function but does not alter it.

Item 7 - Before subsection 8(9)

44.   This item amends the Dumping Duty Act to provide for an appropriate title to subsection 8(9) which describes this provision’s function but does not alter it.

Item 8 - Subsections 9(4) to (5A)

45.   Section 8 of the Dumping Duty Act deals with the imposition of dumping duty in circumstances where the Minister has found that dumped exports to Australia have caused, or threatened, material injury to an Australian industry.  Such dumping duties are the most common form of anti-dumping measures that are imposed in Australia.  Section 9 of the Dumping Duty Act deals with the imposition of dumping duty in circumstances where the Minister has found that dumped exports to Australia have caused, or threatened, material injury to an industry in a third country, and the third country has requested that measures be imposed.  Such third country dumping duties are rarely imposed internationally, and have never been imposed in Australia. 

46.   The relevant provisions of section 9 in relation to third country dumping duty are very similar to equivalent provisions of section 8 in relation to ordinary dumping duty.  The amendments made by this Bill to section 9 are very similar to equivalent amendments made to section 8, and are made for the same reasons. 

47.   Item 8 repeals the present subsections 9(4) to (5A) to remove the current form of interim third country dumping duty from the Dumping Duty Act and substitutes new subsections 9(5) to 9(5AE) to provide for the method for working out the amount of interim countervailing duty due in the Regulations.

Calculation of interim third country dumping duty

48.   New subsection 9(5) requires the Minister to determine that the dumping duty payable on goods the subject of a notice under subsections 269TH(1) or (2) of the Customs Act is an amount worked out in accordance with a specified method.  That method must be one of the methods that will be prescribed in the Regulations in accordance with new subsection 9(5AB).  At least one subsection 9(5) notice will have to be issued in respect of each third country dumping duty notice.  It is by the use of these notices that the Minister will choose from the prescribed methods for imposing third country interim dumping duty. 

Notice has effect accordingly

49.   New subsection 9(5A) provides for a notice under subsection 9(5) to have effect accordingly.

Principles to be followed in specifying method of calculation

50.   New subsection 9(5AA) replaces the present subsection 9(5A), and gives effect to the lesser duty rule in relation to third country dumping duties.  The new subsection applies in the same circumstances as the present subsection, and does not alter its relevant effect.  The new provision is considered necessary due to the repeal and replacement of subsection 9(5).

Methods available for calculating interim dumping duty

51.   New subsection 9(5AB) requires the methods for working out the form of interim third country dumping duty to be prescribed in the Regulations.

52.   New subsection 9(5AC) requires those methods to refer to one or more of the following:

52.1     the export price of the goods the subject of the notice under subsections 269TH(1) or (2) of the Customs Act;

52.2     the export price of goods of that kind as ascertained, or last ascertained, by the Minister for the purposes of the notice;

52.3     the normal value of goods of that kind as ascertained, or last ascertained, by the Minister for the purposes of the notice;

52.4     the non-injurious price of goods of that kind as ascertained, or last ascertained, by the Minister for the purposes of the notice.

53.   New subsection 9(5AD) allows the methods to refer to the export price of goods the subject of the dumping duty notice, as ascertained by the Minister.

54.   New subsection 9(5AE) provides that subsection 8(5BC) does not limit the matters that may be referred to in the methods, so as to avoid any doubt.

Item 9 - Before subsection 9(5B)

55.   This item amends the Dumping Duty Act to provide for an appropriate title to subsection 9(5B) which describes this provision’s function but does not alter it.

Item 10 - Before subsection 9(5C)

56.   This item amends the Dumping Duty Act to provide for an appropriate title to subsection 9(5C) which describes this provision’s function but does not alter it.

Item 11 - Before subsection 9(6)

57.   This item amends the Dumping Duty Act to provide for an appropriate title to subsection 9(6) which describes this provision’s function but does not alter it.

Item 12 - Paragraph 9(6)(b)

58.   This item amends paragraph 9(6)(b) to remove a redundant reference to a section 9(5) notice.  This amendment adds clarity to the Dumping Duty Act.

Item 13 - Before subsection 9(7)

59.   This item amends the Dumping Duty Act to provide for an appropriate title to subsection 9(7) which describes this provision’s function but does not alter it.



Item 14 - Paragraph 10(1)(a)

60.   This item amends paragraph 10(1)(a) to remove erroneous section references in the Dumping Duty Act.

Item 15 - Paragraph 10(1)(b)

61.   This item is a consequential amendment to Item 14.

Item 16 - Paragraph 10(3C)(b)

62.   This item amends paragraph 10(3C)(b) to remove erroneous reference to "export price of those particular goods".  For further information see paragraph 34 above.

Item 17 - Subsection 10(3C)

63.   This item amends paragraph 10(3C) to remove errors in the Dumping Duty Act.

Item 18 - Paragraph 10(3D)(a)

64.   This item amends paragraph 10(3D)(a) to remove erroneous reference to "export price of those particular goods".  For further information see paragraph 34 above.

Item 19 - Paragraph 11(5)(b)

65.   This item amends paragraph 11(5)(b) to remove erroneous reference to "export price of those particular goods".  For further information see paragraph 34 above.

Item 20 - Subsection 11(5)

66.   This item amends paragraph 11(5) to remove erroneous reference to "export price of those particular goods" and provide reference to just the export price.  This item works in conjunction with item 19 to achieve the correction detailed in paragraph 34 above.

Item 21 - At the end of the Act

67.   This item inserts a new section 22 which enables the Governor-General to make regulations prescribing matters required or permitted by the Dumping Duty Act to be prescribed.   This would include regulations prescribing methods for interim dumping duty and interim third country dumping duty as required by new subsections 8(5BB) and 9(5AB).



Item 22 - Saving and Transitional provisions

68.   This item provides that the amendments made by the Schedule do not affect the validity of a notice given under subsections 8(5) or 9(5) of the Dumping Duty Act before the commencement of this item (an old notice). 

69.   The second subsection of this item does not prevent, in accordance with subsection 33(3) of the Acts Interpretation Act 1901 , the revocation of an ‘old notice’ and its replacement with either a new section 8(5) notice or a new subsection 9(5) notice being issued.  This provision allows for a new form of duty to be used in relation to anti-dumping measures initiated before the commencement of this item.

70.   Subsection 33(3) of the Acts Interpretation Act 1901 allows that ‘[w]here an Act confers a power to make, grant or issue any instrument (including rules, regulations or by-laws) the power shall, unless the contrary intention appears, be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to repeal, rescind, revoke, amend, or vary.’