An antidumping duty may be impose if it is established by the investigating authority (National Tariff Commission), after due process, that:

1. A product has been dumped into Pakistan; and
2. that dumping has caused or threatens to cause injury to Pakistan’s domestic industry.

In Pakistan, the National Tariff Commission (“Commission”) is a body responsible for conduction of an antidumping investigation. Once the essential elements for imposition of antidumping duty are determined, after due process, the Commission may impose antidumping duty equal to the dumping margin established.

If a company exports a product at a price (export price) lower than the price it normally charges on its own home market (normal value), it is said to be ‘dumping’ the product.

Dumping can harm the domestic industry by reducing its sales volume and market shares, as well as its sales prices. This in turn can result in decline in profitability, job losses and, in the worst case, in the domestic industry going out of business.

How do you define:

• Normal Value
• Export price and
• dumping margin

Normal Value:
Normal value is the comparable price at which the goods under complaint are sold, in the ordinary course of trade, in the domestic market of the exporting country.

Export price:
The Export price of the goods allegedly dumped into Pakistan means the price at which it is exported to Pakistan. It is generally the CIF value minus the adjustments on account of ocean freight, insurance, commission, etc. so as to arrive at the value at ex-factory level. Dumping margin:
The margin of dumping is the difference between the Normal value and the export price of the goods under complaint. It is generally expressed as a percentage of the export price.

If the export price is lower than the normal value, it constitutes dumping. Thus, there are two fundamental parameters used for determination of dumping, namely, the normal value and the export price. Both these elements have to be compared at the same level of trade, generally at ex-factory level, for assessment of dumping.

If the export price is lower than the normal value, it constitutes dumping. Thus, there are two fundamental parameters used for determination of dumping, namely, the normal value and the export price. Both these elements have to be compared at the same level of trade, generally at ex-factory level, for assessment of dumping.

Often, dumping is mistaken and simplified to mean cheap or low priced imports. However, it is a misunderstanding of the term. On the other hand, dumping, in its legal sense, means export of goods by a country to another country at a price lower than its normal value. Thus, dumping implies low priced imports only in the relative sense (relative to the normal value), and not in absolute sense.

Anti dumping is a measure to rectify the situation arising out of the dumping of goods and its trade distortive effect. Thus, the purpose of anti dumping duty is to rectify the trade distortive effect of dumping and re-establish fair trade. The use of anti dumping measure as an instrument of fair competition is permitted by the WTO. In fact, anti dumping is an instrument for ensuring fair trade and is not a measure of protection for the domestic industry. It provides relief to the domestic industry against the injury caused by dumping.

Normal value is the comparable price at which the goods under complaint are sold, in the ordinary course of trade, in the domestic market of the exporting country.

The Export price of the goods allegedly dumped into Pakistan means the price at which it is exported to Pakistan. It is generally the CIF value minus the adjustments on account of ocean freight, insurance, commission, etc. so as to arrive at the value at ex-factory level.

The margin of dumping is the difference between the Normal value and the export price of the goods under complaint. It is generally expressed as a percentage of the export price.

Anti dumping measures do not provide protection per se to the domestic industry. It only serves the purpose of providing remedy to the domestic industry against the injury caused by the unfair trade practice of dumping.

Following are the essential requirements for initiating an anti dumping investigation: -

Sufficient evidence to the effect that;

• There is dumping
• There is injury to the domestic industry; and
• There is a causal link between the dumping and the injury, that is to say, that the dumped imports have caused the alleged injury.

The domestic producers expressly supporting the anti dumping application must account for not less than 25% of the total production of the like product by the domestic industry.

The application is 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 50% of the total production of the like product produced by that portion of the domestic industry expressing either support for or opposition as the case may be, to the application.

Broadly, injury may be analyzed in terms of the volume and price effect of the dumped imports. The parameters by which injury to the domestic industry is to be assessed in the anti dumping proceedings are such economic indicators having a bearing upon the state of industry as the magnitude of dumping, and the decline in sales, inventories, employment, wages, ability to raise capital or investments, selling price, profits, market share, production, utilization of capacity etc.

In the anti dumping proceedings, it is imperative to prove that the dumping has caused injury to the domestic industry. No anti dumping duty shall be recommended without a finding of this causal relationship. That is to say,

DUMPING should lead to INJURY

The causal link is to be established generally in terms of the following effects of dumped imports on domestic industry: -

1. volume effect
2. price effect

The volume effect of dumping relates to the market share of the domestic industry vis-à-vis the dumped imports from the subject country/ies while with regard to the price effect, the investigating authority shall consider whether there has been a significant price under cutting by the dumped imports as compared with the price of the like product in Pakistan, or whether the effect of such imports is otherwise to depress prices to a significant degree or prevent price increase which otherwise would have occurred to a significant degree.

The Commission can impose duties upto the margin of dumping determined i.e. the difference between the normal value and the export price.

Where the margin of dumping determined is less than 2% of the export price the investigation shall immediately be terminated.

Further, investigation against any country is required to be terminated if the volume of the dumped imports, actual or potential, from a particular country accounts for less than 3% of the total imports of the like product.

However, in such a case, the cumulative imports of the like product from all these countries who individually account for less than 3%, should not exceed 7% of the import of the like product.

The relief to the domestic industry against dumping of goods from a particular country is in the form of anti dumping duty imposed against that country/ies, which could go up to the dumping margin. Such duties are exporters/producers specific.

However, the remedy against dumping is not always in the form of anti dumping duty. The Authority may terminate or suspend investigation after the preliminary findings if the exporter concerned furnished an undertaking to revise its price to remove dumping or the injurious effect of dumping as the case may be. No anti dumping duty is imposed on such exporters from whom price undertaking has been accepted.

The Application for dumping investigation must contain:

• Description of import product, country of export, names of exporters
• Reasonable evidence on dumping (i.e on normal value and export price) and of resultant injury suffered by it.

Sources of Information
The information/data for the purpose of filing-up applicant’s questionnaire can inter-alia be obtained from domestic industry (the applicant)

• Government of importing country (Customs, Statistics departments)
• Government of exporting country
• Importers
• Industrial users
• Exporters
• Foreign producers
• Press and publications
• Consulting firms
• Internet etc.

An anti-dumping application is processed with in a period of 12 months.

Yes, provisional anti-dumping duty can be imposed after 60 days of initiation of the investigation.

Anti-dumping duty may be imposed for a period, which may extend up to 5 years.

The Application should be made with the Commission on the prescribed Antidumping Applicant Performa/Questionnaire, with answers to questions presented in a logical sequence.

Advice on how to complete a questionnaire can be obtained from the Commission [Tele # 051-920 1188-34, Fax # 051- 922 1205

The questionnaire also advises the applicant what types of evidence to provide in the appropriate areas. The applicant is also required to deposit fee Rs. 75,000/- in the favour of the Commission.

Yes, the Pre-Application Counseling Section at the Commission is available for guidance and assistance of the industries regarding antidumping law, investigation process and the information needed in an Application.