Trade Update 5

WEEKLY TRADE UPDATE

Legislative Amendments by the Union Budget 2020-2021 of International Trade Laws

Budget 2020 has announced amendments to the existing Anti-dumping Rules and the Countervailing Duty Rules. Part 3 (Tariff-rate Quota) and Part 4 (Rules of Origin) are proposed
to be included vide Finance Bill, 2020.

PART 1: ANTI-DUMPING RULES
Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped
Articles and for Determination of Injury) Amendment Rules, 2020.

1. ‘Related parties’ Explanation restructured.
The Explanation to Rule 2(b) that defines ‘domestic industry’, has been amended with its subclause
(ii) being converted to a Note. This clarifies that a producer shall be deemed to control another producer when the former is legally or operationally in a position to exercise restraint or direction over the latter, for the limited purpose of identifying ‘related’ parties. This is to bring the Antidumping Rules at par with the WTO Anti-dumping Agreement.

2. ‘Period of Investigation’ defined.
The Period of Investigation is now defined in clause (da) of Rule 2 as the period during which the existence of dumping is examined.

3. New Shipper Rule is amended and the period of investigation is regulated upon.
Rule 22 providing for New Shipper Review has been amplified to add a new sub-rule (3) inspired from the EU anti-dumping law. The new sub-rule provides that an anti-dumping duty already imposed for co-operative un-sampled exporters or producers in the original investigation may be
extended to ‘new shippers’.

The Explanation to the new sub-rule prescribes the determination of the period of investigation to be not more than six months old as on the date of initiation of investigation and to be for a period of twelve months. The period of investigation can be altered to a minimum of six months or maximum of eighteen months for reasons to be recorded in writing.

4. Anti-circumvention Rules revamped.
Rule 25, the provision for anti-circumvention duties, is amended, taking cue from EU Circumvention law with modification. This change has been warranted by the challenge to the interpretation of the erstwhile Rule 25 that is pending consideration in the Supreme Court.