Introduction and background
On 26 February 2015 the Customs Amendment (Anti-Dumping Measures) Bill
(No. 1) 2015 and the Customs Tariff (Anti-Dumping) Amendment Bill 2015 (the
bills) were introduced into the House of Representatives.
On 18 March 2015 the bills were introduced into the Senate and were referred to
the Senate Economics Legislation Committee (the committee) for inquiry and
report by 5 May 2015.
Conduct of the inquiry
The committee advertised its inquiry on its website. The committee also
wrote directly to the Commonwealth, state and territory governments and other
stakeholders, drawing attention to the inquiry and inviting them to make
The committee received 11 submissions, which are listed at Appendix 1. The
committee held one public hearing in Canberra on 4 May 2015. The committee
thanks all those who assisted with the inquiry, especially those who made
written submissions and attended the hearing.
Structure of this report
This report comprises two chapters:
The remaining sections of Chapter 1 provide background
information about Australia's anti-dumping system and a summary of the proposed
examines the arguments for and against the proposed amendments.
Background on Australia's anti-dumping system
This section provides background on Australia's anti-dumping system, and
discusses previous reviews and reforms to the system.
Australia's anti-dumping system has been set up to manage circumstances
in which Australian businesses may suffer injury as a result of goods from
overseas being dumped into markets within Australia. The Anti-Dumping
Commission has described dumping and anti-dumping as follows:
Dumping occurs when an exporter sells goods to Australia at a
price that is below the ‘normal value’ of the goods. The normal value
will usually be the domestic price of the goods in the country of export. The
margin of dumping is the amount by which that normal value exceeds the ‘export
price’ of the goods.
Dumping is not prohibited under international trade
agreements and it is not illegal.
Anti-dumping is the imposition of a measure by the Australian
government, in the form of an additional duty on imports and/or a minimum
export price, to remedy material injury to Australian manufacturers caused by
The Productivity Commission has described Australia’s anti-dumping
system as a system that seeks to remedy the injurious effects on Australian industry
caused by imports deemed to be unfairly priced:
It allows local industry to apply for anti-dumping duties on
goods ‘dumped’ in Australian markets at prices below those prevailing in the
exporter’s domestic market or to apply for countervailing duties on goods that
have been subsidised by the government of the country of export. Where the
dumping or subsidisation results in material injury to local industry,
anti-dumping or countervailing duties can be applied.
Countervailing duties are duties imposed on goods by an importing
country which finds that an exporting country has directly or indirectly
those exports, thus resulting in a (threatened) material injury to a domestic
firm or industry.
As a member of the World Trade Organisation (WTO), Australia's
anti-dumping system is based on WTO agreements that:
prescribe rules for the conduct of anti-dumping investigations
and the application of measures to address dumping, including how member
countries may: initiate cases, calculate dumping margins, determine injury,
enforce remedial measures and review past determinations; and
regulate measures designed to remedy material injury caused by
The WTO agreements are an important part of the international trade system
and signify that dumping and subsidisation can constitute unfair trade practices
and that, where they do, nations are entitled to respond. The WTO agreements on
anti-dumping and countervailing are intended to achieve a level playing field.
However, interpretation of the agreements differs between countries.
Previous reviews and reform of
Australia's anti-dumping system
This section provides a brief summary of previous reviews and reforms of
Australia's anti-dumping system. The Productivity Commission has summarised the
usage and previous reviews of the anti-dumping system, noting that usage increased
in the early 1980's following the earlier global recession:
Though Australia’s anti-dumping system has been in place for
over 100 years, it was not until the early 1980s that usage of the system became
This was triggered by global recession, falling commodity
prices and the Government’s reluctance to raise tariff levels.
Usage of the system peaked in the mid-1980s, which led to a
backlash against the system from some users of the products subject to
Since the mid-1980s (aside from a brief upsurge in the early
1990s) usage of the system has steadily declined.
[A] major review of the anti-dumping system was carried out
in 1986 (the Gruen Review). Subsequent reviews — including the Willett Review
in 1996 and the Joint Study in 2006 — have focussed largely on the
administration of the system.
In 1988, following the Gruen Review in 1986, legislation was passed to
establish the Anti-Dumping Authority (ADA) to create a two-tier administrative
system. The system included Australian Customs Service (Customs)
conducting investigations up to a preliminary findings stage, and the ADA
reviewing the preliminary findings and making final findings.
The 1996 Willett Review initiated by the then Government led to a new
legislative framework and new administrative arrangements, including a
rationalisation of the two-stage investigation system. The ADA was abolished in
1998 and Customs assumed sole responsibility for investigating and reporting on
In 2006 a joint study by relevant federal government departments was
initiated to assess whether Australia's anti-dumping administration reflected
best practice and to respond to concerns of Australian manufacturers about the
effectiveness of the system.
In December 2009 the Productivity Commission completed an inquiry into
Australia's Anti-dumping and Countervailing System. The inquiry found that the
Australian anti-dumping system benefits a small number of firms whose goods
compete with imported goods (import-competing firms), but imposes costs on the
rest of the economy. However, the net economic cost is likely to be small.
The Productivity Commission also found that there were deficiencies in
the Australian anti-dumping system including that:
there is no consideration of the wider economic impacts of
measures can too easily become akin to long-term protection, or
outdated in the face of changing market circumstances; and
decision-making and its outcomes are not sufficiently
The Productivity Commission recommended that a public interest test should
be put in place to take account of wider impacts of measures and prevent the
imposition of measures that would be disproportionately costly.
In 2011 this committee completed inquiries into two bills proposing
changes to Australia's anti-dumping system. In its report on the Customs
Amendment (Anti-dumping Measures) Bill 2011, the committee noted that the bill was introduced following
the Full Federal Court's findings in Minister of State for Home Affairs v
to address a lack of clarity in the review process. The amendments proposed
by that bill were separate to the Government's consideration of the
Productivity Commission's inquiry report and a private senator's bill which considered a broad range of issues
related to Australia's anti-dumping framework.
In June 2011 the then government announced a package of reforms referred
to as 'Streamlining Australia's anti-dumping system'. The reforms took account
of reports by the committee and set out to implement 15 of the 20
recommendations made by the Productivity Commission's inquiry.
Aspects of the policy, Streamlining Australia's anti-dumping system,
have been implemented through legislation including the following legislation:
Customs Amendment (Anti-dumping Improvements) Act 2011;
Customs Amendment (Anti-dumping Improvements) Act (No. 1)
Customs Amendment (Anti-dumping Improvements) Act (No. 2) 2012;
Customs Tariff (Anti-dumping) Amendment Act (No. 1) 2012; and
Customs Amendment (Anti-dumping Improvements) Act (No. 3) 2012.
In 2012, following concerns about a threefold increase in the number of
anti-dumping claims in Australia in 2011–12, the then government requested the
former Premier of Victoria, John Brumby, to undertake a review of anti-dumping
issues (the Brumby review). The Brumby review noted that while significant
reform had already been undertaken, further reform was needed:
While there is widespread support for the range of reforms
put in place by the Australian Government over recent years, the reforms needs
to continue and more needs to be done. Further changes to Australia’s
anti-dumping arrangements are vital if Australia is to achieve an effective,
highly regarded and world-class anti-dumping and countervailing system.
The Brumby review drew attention to the performance and resourcing of
the anti-dumping system over two decades and the impact of contemporary
For almost two decades the Australian anti-dumping system has
been administered with limited resources and a low organisational profile. The
inability to meet key performance indicators as well as extensions of time
sought demonstrate pressure on our system. The workload of the administration
has near tripled in the last 12 months and a number of relevant drivers
indicate a high likelihood that more anti-dumping applications are on the way. The
low profile and limited resources at a time of intense international
competition has undermined public confidence in the system, especially from a
recommendation of the Brumby review was that a new International Trade Remedies Authority, Agency
or Commission be established under legislation and that the agency be
separately and adequately resourced, and headed by a legislated CEO or
Commissioner who reports directly to the Minister for Home Affairs and Justice.
The Brumby review also made a number of other recommendations associated with
the implementation and operation of the new body.
The Anti-Dumping Commission and
Following the recommendations of the Brumby review, legislation to
establish the Anti-Dumping Commission was passed in March 2013 and the
Commission was established in July 2013.
The Anti-Dumping Commission:
...administers Australia’s anti-dumping and countervailing
(anti-subsidy) system. Upon application by the Australian industry setting out
prima facie evidence of the dumping or subsidy and the injury the Commission
commences an investigation and reports to the Minister whether anti-dumping or
countervailing duties should be imposed on goods from the countries named in
The Anti-Dumping Review Panel (Review Panel) conducts
independent reviews, upon application, of certain decisions made by
the Minister for Industry and Science (or the Parliamentary Secretary) or
by the Commissioner of the Anti-Dumping Commission in relation to anti-dumping
and countervailing investigations.
The Review Panel was established on 10 June 2013. Three panel Members are
appointed by the Minister for Industry and Science under the Customs Act
1901 for a term of up to three years.
Circumvention practices take various forms and exploit different aspects
of the anti-dumping and countervailing system. The outcome of these practices
is that they ensure that the relevant goods do not attract the intended dumping
or countervailing duty, or the relevant goods attract the duty, which is paid,
but the payment of the duty does not have the intended price effect in the
In June 2013, new legislative provisions for conducting
anti-circumvention inquiries commenced. These provisions are based on
'prescribed' circumvention practices commenced. This formed a central component
of the previous Government’s Streamlining Australia’s anti-dumping system reforms
On 15 September 2014 the Minister for Industry, the Hon Ian Macfarlane
MP, asked the House of Representatives Standing Committee on Agriculture and
Industry to conduct an inquiry into Australia’s anti-circumvention framework in
relation to anti-dumping measures. The terms of reference provide for that
committee to inquire into and report on the following matters:
the scope, prevalence and impact of circumvention practices by
foreign exporters and Australian importers, especially from the perspective of
the operation of the anti-circumvention framework since its
introduction in June 2013 including its accessibility, use by Australian
businesses, recent amendments and effectiveness to date;
practices that circumvent anti-dumping measures and the models
for addressing practices administered by other anti-dumping jurisdictions; and
areas which require further consideration or development
including the effectiveness of anti-dumping measures and the range and scope of
Current and previous packages of reforms
On 15 December 2015, the Minister for Industry the Hon Ian Macfarlane MP
and Parliamentary Secretary Bob Baldwin MP announced a package of reforms
called 'Levelling the playing field for Australian Manufacturers and
The measures deliver the Government's remaining
anti-dumping election commitments and make further improvements, including
addressing behaviours of firms trying to avoid payment of duties. The package
also improves access to the system through greater assistance to businesses.
All of the reforms comply with Australia’s World Trade Organization and other
international trade obligations.
An earlier package of reforms set out in ‘The Coalition Policy to
Boost the Competitiveness of Australian Manufacturing’, released in August
2013, also proposed measures to strengthen Australia’s anti-dumping system by
introducing more stringent deadlines for the submission of information to
dumping and subsidisation investigations.
Overview of the bills
This section provides a brief overview of the purpose of the bills and
the changes that the bills propose.
Customs Amendment (Anti-dumping
Measures) Bill (No. 1) 2015
The Customs Amendment (Anti-dumping Measures) Bill (No. 1) 2015 is the
primary bill. The explanatory memorandum sets out the purpose of the primary
The purpose of the Bill is to amend the Customs Act 1901
(Customs Act) to strengthen Australia’s provisions dealing with the submission
of information in anti-dumping and countervailing duty investigations, simplify
and modernise publication provisions for anti-dumping notices, consolidate
lodgement provisions for anti‑dumping applications and submissions,
clarify the length of the investigation period in anti-dumping matters, clarify
the cumulative assessment of injury, clarify normal value provisions, clarify
the calculation of the dumping margin, clarify material injury determinations,
clarify effective notice periods, clarify the definition of a subsidy, amend
provisions dealing with new exporters, clarify provisions regarding
consideration of the lesser duty rule, streamline the processes and implement a
higher procedural and legal threshold for review to be undertaken by the
Anti-Dumping Review Panel (Review Panel) and allow the Government to replace
the statutory International Trade Remedies Forum (the Forum) with
administrative business consultative arrangements.
The primary bill contains one schedule with 15 Parts, each of which
proposes a different change to the Customs Act 1901. Part 15 of the
schedule proposes to abolish the International Trade Remedies Forum, which was
established to provide strategic advice to government on the operation of
Australia's anti-dumping system.
Parts 12 to 14 of the primary bill propose changes to the operation of the
Anti-Dumping Review Panel, including:
Part 12 which proposes that the Anti-Dumping Review Panel will be
able to charge fees for reviews. The fee would be prescribed by legislative
Part 13 which proposes a number of changes to the Anti-Dumping
Review Panel’s processes, including higher procedural and legal thresholds for
applications, and a requirement for statements of grounds for review
Part 14 which proposes changes to make it possible for applicants
to withdraw applications for a review and establish the potential for partial
refund of application fees.
Parts 1 to 11 of the primary bill contain a series of technical
amendments which propose changes to submission timeframes, lodgement and
processes (Parts 1 and 2), investigation timeframes (Parts 3 and 6),
criteria for decisions (Parts 4, 5, 7, 10 and 11) and alignment with WTO
agreements (Parts 9 and 10):
Part 1 proposes to reduce the deadline for submissions during the
Anti-Dumping Commission’s processes from 40 days to 37;
Part 2 proposes changes to allow the Anti-Dumping Commissioner to
specify how submissions are to be lodged, and that anti-dumping notices will be
published on the Anti-Dumping Commission’s website rather than in the Gazette;
Part 3 proposes that the Anti-Dumping Commissioner will not be
able to vary the length of an investigation period;
Part 4 proposes to allow the cumulative assessment of the impact
of dumping from multiple countries;
Part 5 proposes to clarify that there is no hierarchy for the
methods available to determine a normal value of goods;
Part 6 proposes that in determining whether dumping has occurred,
the minimum period that must be considered will be reduced from two months to
Part 7 proposes a revised definition of subsidies;
Part 8 proposes revised arrangements for accelerated reviews that
constrain the Minister to only be able to leave the duty unchanged, or apply it
at a lower rate during the review. In addition, the definition of new exporters
is changed so that potentially a larger number will be able to seek accelerated
Part 9 proposes changes to the period during which notices remain
in force to align with the trade rules set out by WTO agreements. Anti-dumping
measures would expire after five years from the date of the original imposition
of the measures;
Part 10 proposes to clarify that a finding of dumping cannot be
made in relation to goods exported prior to the investigation period (in line
with WTO commitments);
Part 11 proposes to amend the Customs Act to provide that the
Minister is not required to have regard to the lesser duty rule when
considering the imposition of countervailing duties if the relevant country of
export has not submitted notification of its subsidies at least once in the
Customs Tariff (Anti-Dumping)
Amendment Bill 2015
The purpose of the Customs Tariff (Anti-Dumping) Amendment Bill 2015
(tariff bill) is to amend the Customs Tariff (Anti-Dumping) Act 1975
(Dumping Act) to simplify and modernise publication provisions for anti-dumping
notices, clarify provisions regarding consideration of the lesser duty rule and
clarify the operation of exemption provisions.
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