1. Legal Provisions

 

The applicable provisions for initiation of an investigation under the domestic law are contained in Rule 5 of the AD Rules which corresponds to the provision in Article 5 of the ADA.

 

Rule 5. Initiation of investigation. - (1) Except as provided in sub- rule (4), the designated authority shall initiate an investigation to determine the existence, degree and effect of any alleged dumping only upon receipt of a written application by or on behalf of the domestic industry.

 

(2) An application under sub-rule (1) shall be in the form as maybe specified by the designated authority and the application shall be supported by evidence of -

 

a. dumping

b. injury, where applicable, and

c. where applicable,acausallinkbetweensuchdumpedimports and alleged injury.

 

(3) The designated authority shall not initiate an investigation pursuant to an application made under sub-rule (1) unless -

 

it determines, on the basis of an examination of the degree of support for, or opposition to the application expressed by domestic producers of the like product, that the application has been made by or on behalf of the domestic industry:

 

Provided that no investigation shall be initiated if domestic producers expressly supporting the application account for less than twenty five per cent of the total production of the like article by the domestic industry, and it examines the accuracy and adequacy of the evidence provided in the application and satisfies itself that there is sufficient evidence regarding

 

i. dumping,

ii. injury, where applicable; and

iii. where applicable, a causal link between such dumped imports and the alleged injury, to justify the initiation of an investigation

 

Explanation - For the purpose of this rule the application shall be deemed to have been made by or on behalf of the domestic industry, if it is supported by those domestic producers whose collective output constitute more than fifty per cent of the total production of the like article produced by that portion of the domestic industry expressing either support for or opposition, as the case may be, to the application.

 

Notwithstanding anything contained in sub-rule (1) the designated authority may initiate an investigation suo motu if it is satisfied from the information received from the Commissioner of Customs appointed under the Customs Act, 1962 (52 of 1962) or from any other source that sufficient evidence exists as to the existence of the circumstances referred to in clause
(b) of sub-rule (3).

 

The designated authority shall notify the government of the exporting country before proceeding to initiate an investigation.

 

2. Operating Practices

 

An anti-dumping case normally starts with the formal receipt of an application in the DGTR from the Indian Domestic Industry (hereinafter referred to as “DI”) in the prescribed format stating that the injurious dumping is taking place. This complaint is called the application in the ADA and the petition as per Indian terminology. Article 5.2 of the ADA contains the requirements for the contents of this application. It must include evidence on dumping, injury and the causal link between the two.

 

The requirements for filing an application for initiation of investigation prescribes that an application shall be in the form as maybe specified by the designated authority. Accordingly, the format prescribed by the Authority becomes an integral part of the requirements of Rule 5(2).

 

The application for sunset review must be filed by the DI at least 240 days prior to the date of the expiry of existing anti-dumping measures. In the case of Mid-Term Review, the application must be filed between 12 months to 42 months from the date of imposition of the duty.]

 

Generally, the Designated Authority initiates the investigations for anti- dumping on the basis of an application filed by the domestic industry.1 However, Rule 5(4) of the AD Rules provides for suo-motu initiation of anti-dumping proceedings also by the Designated Authority on the basis of information received from the Collector of Customs appointed under the Customs Act, 1962 or from any other source. In such circumstances, the Authority initiates the anti-dumping investigations on its own without any application filed in this regard, provided the Authority is satisfied that sufficient evidence exists as to the existence of dumping, injury and causal link between the dumped imports and the alleged injury. It is further clarified that after initiation, the suo-motu investigation follows the same procedure as the one based on an application as mentioned in the AD Rules.

 

As per Rule 5(2), it is indispensable that the application is supported by evidence of dumping, injury and the causal link between dumping and injury, as may be applicable. The ADA also has this requirement under Article 5.23, to the extent the information is reasonably available. The underlying purpose of such a provision is to ensure that a mere assertion of dumping, unsubstantiated by relevant evidence, is not considered sufficient for initiating the anti-dumping investigation.

 

The application should be accompanied with following documents in addition to the prescribed formats notified vide Trade Notice 02/2018 dated 1.2.2018:

 

S.N                                                   Documents / Information

1.      Write up about the industry and the product under consideration against which dumping is alleged

2.      HS Codes for the alleged dumped products in the application

3.      A background on any previous trade remedy investigations

4.      Total Indian production of the product

5.      Letters of Support with required information in Annex-I, Annex-II and Annex-III as prescribed vide Trade Notice No. 13/2018 dated 27th September 2018.

6.      Installed capacity of PUC with supporting documents like the Pollution Control Board Certificate

7.      Total Demand in India along with sales details of PUC by the applicant(s)

8.      Transaction wise Import data (import volume and value) obtained from DGCI&S after due authorization from DGTR in terms of Trade Notice 7/2018 dated 15.3.2018 and the summary of the same for each of the subject country

9.      The calculation and methodology for NEP

10.      Direct evidence of domestic selling price in the exporting country, if available

11.      In case direct evidence is not available, reasonable other evidence of the prevailing selling price in the exporting country

12.      In case of non-availability of the domestic selling price in the country of export, then Constructed Normal Value be provided along with the methodology for the calculations

13.      The detailed reasons in case of his claim that any of the exporting country is alleged to be operating in non-market conditions

14.      Soft copy of the application along with excel working sheets (As detailed in paragraph 2.19)

15.      The costing formats – NIP/ Capital Employed Calculations along with soft copy of excel sheets as detailed below in para 2.19.

16.      Audited financial statements and cost audit reports of the injury period including POI

17.      In case of new units not having completed four years since the commencement of commercial production – The project report or any other similar document submitted to the Government agency

18.      In case of SSR - Additional information regarding likelihood and recurrence as pre- scribed vide Trade Notice No. 02/2017 dated 12th December 2017.

19.      In case of NSR – Application in the format prescribed vide Trade Notice No. 08/2018 dated 25.4.2018

20.      In the case of MTR - Additional information to be submitted in terms of Rule 23(1A)

21.      Confirmation from the applicants/consultants that the complete cost data for all the units of the DI manufacturing or selling PUC has been furnished in the application. In other words, no unit manufacturing or selling PUC has been left out.

22.      Confirmation from the company/consultants that no amount of expense disallowed under Annexure-III has been considered in the cost computations.

 

The application submitted has to be verified by the nominated officers with respect to the conformity of documents as per checklist notified vide Trade Notice No. 15/2018 dated 22.11.2018. This helps in expeditious processing and examination of application leading to a decision regarding initiation/ rejection of the application.

 

Once the nominated officers approve the submission of the application, the same is accepted and a file number/case number is generated in the system.

 

The application is put up to the DG for the nomination of the investigation team for the case and specific allocation order is issued which is sent to the team along with the original case file4.

 

The investigation team may call for any further information upon examination, if deemed fit, which could be in addition to the documents mentioned in the check- list, the Investigation team should always call for such additional information in writing, through an email (instructions attached) and no oral requests should be made. A copy of all these letters may also be marked to dgad.india@gov.in.

 

The team can also obtain information pertaining to DI, PUC, imports and other details from the sources as mentioned below for examination and/or verification.

 

Source of data information at the disposal of the Authority (available on request)

 

S.N.	Source & Description
1	DGCI&S - Transaction wise import data based on HSN Codes containing importers’ names and product details.
2	DG Systems- Transaction wise import data based on HSN Codes/description containing importers and exporters name along with product details
3	Ministry of Corporate Affairs – Financial data, related party details regarding companies/entities registered with MCA. Cost Audit details are also available, where applicable.
4	GSTN – HSN Code wise (2 digit / 4 digits) details of existing producers in India and sales clearances (including exports and imports) by registered entities

 

The application/ petition has to be considered “Confidential” till it is decided to initiate an investigation as is provided in Article 5.5 of the ADA. The relevant provision of Article 5.5 reads as below:

 

“The authorities shall avoid, unless a decision has been made to initiate   an investigation, any publicizing of the application for the initiation of an investigation. However, after receipt of a properly documented application and before proceeding to initiate an investigation, the authorities shall notify the government of the exporting Member  concerned.”

 

Even though the Indian anti-dumping law has no similar provision, it is clear that the information with respect to receipt of all the applications are to be treated as confidential and should not be publicized.

 

Many a time information is required to be sought from other producers in India regarding their support or opposition or confirmation of their production/sale. This is for arriving at the correct standing of the applicant for being an eligible DI.

 

The Embassy of the subject country under investigation must be informed regarding receipt of the application, before actual initiation. A template for intimation to Embassies is enclosed with this chapter.

 

After initiation, the non-confidential version of the application is put in an inspection folder.

 

DETAILS OF WORKING SHEETS (as referred in the table above)

 

The costing details in excel files must be submitted by the applicant(s) for the POI as detailed below:

 

S. N.	Document
1	The costing formats – NIP/ Capital Employed Calculations
2	Calculation of CNV, if estimated NV is based on CNV
3	Details of Job work done during POI, if any
4	Details of Administration Overheads
5	Details of Selling & Distribution Overheads
6	Details of Other/Miscellaneous  Overheads
7	Details of Misc. Income
8	Details of HO Expenses and their allocation
9	Details  of  by-product/wastage/rework generated
10	The basis of major utility allocation done for PUC & other Products
11	Details of revaluation/impairment of assets details, if any during POI & previous years, if included in the books
12	Explanation for the methodology adopted in segregating the import data into PUC and NPUC.

Explanation for the methodology adopted in segregating the import data into PUC and NPUC.

 

Source: Manual Of Operating Practices For Trade Remedy Investigations