remedy measures globally. - Raised by Japan at the WTO, 27 October - - PowerPoint PPT Presentation

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remedy measures globally
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remedy measures globally. - Raised by Japan at the WTO, 27 October - - PowerPoint PPT Presentation

Nov 25, 2022 317 likes •700 views

Japan said it was concerned oversupply in steel was mainly due to expansion of production capacity among emerging economies that did not have an economic justification and that this was triggering a rise in trade remedy measures globally. -

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Japan said it was concerned oversupply in steel was mainly due to expansion of production capacity among emerging economies that did not have an economic justification and that this was triggering a rise in trade remedy measures globally.

  • Raised by Japan at the WTO, 27 October 2016
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SLIDE 3 0% 20% 40% 60% 80% 100% 120% Jan to Jun 14 Jul to Dec 14 Jan to Jun 15 Jul to Dec 15 Jan to Jun 16

G20 percentage of anti-dumping cases

0% 20% 40% 60% 80% 100% 120% Jan to Jun 14 Jul to Dec 14 Jan to Jun 15 Jul to Dec 15 Jan to Jun 16

G20 percentage of countervailing cases

35% 41% 33% 51% 38% 63% 67% 58% 87% 42%
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With every market that closes to dumped steel, it becomes more likely that steel will be dumped in the next market

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Understanding the tariff book

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Chapter 73 – Articles of iron and steel

Heading

Sub- headings

Chapter

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9%

  • f all downstream imports are cleared through 1 tariff code

R2.1bn

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SLIDE 8 $2 000 $2 200 $2 400 $2 600 $2 800 $3 000 $3 200 $3 400 $3 600 $3 800 10 000 20 000 30 000 40 000 50 000 60 000 May 14 to Apr 15 May 15 to Apr 16 May 16 to Apr 17

7326.90.90 - ARTICLES OF IRON OR STEEL: Other Articles Of Iron Or Steel:

  • - Other:
  • - - Other

36 000 tons 45 000 tons 53 000 tons $3 610 per ton $3 050 per ton $2 790 per ton

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Split very broad tariff codes into detailed subheadings

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Duty increase

Fastest solution, but limited duty size and doesn’t impact trade agreement countries

Safeguard

Emergency action to offset a surge in imports. Potentially large duty or quota, but only for a limited period

Anti-dumping

Large potential duties on specific countries only. Takes longer to yield a result

Countervailing

Used to offset subsidies. No current political appetite to act against China

Duty protection options

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Duty increase

  • Duty can only be increased to the bound rate
  • Duty increase only affects countries which we have no trade

agreement with

  • Does not require industry standing for an investigation to be initiated
  • Relatively fast action

Number of downstream tariff codes below bound rate 163 Number of downstream tariff codes at the bound rate 47 Total downstream steel tariff codes 210

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The largest downstream sector never responded to the downstream investigation

R5bn 21%

Imports between March 2016 and February 2017

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  • Know the tariff codes for every product

you manufacture

  • Monitor your import statistics to identify

risky trends

  • Split the very broad tariff codes into more

detail

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Dumping happens when…

Goods are exported at a price lower than they are sold in their home market, causing injury to

  • ur domestic industry
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Ex-works price in the domestic market – ex-works export price to South Africa = dumping margin Dumping margin / export price = anti-dumping duty

The calculation

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The calculation

If more than 20% of the domestic sales are made below cost, then discard all sales below cost

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The implementation of duties

  • Duties are imposed against specific countries and

companies

  • Duties remain in place for 5 years (renewable)
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China and market economy status China is deemed to have a market economy, meaning that the dumping margin will be calculated on the actual information submitted by exporters

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China and market economy status

Options to offset the effect of subsidies

  • 1. Add the value of the subsidies to the costs, thus

increasing the dumping margin (more sales below cost)

  • 2. Add the subsidies to the normal value and increase

the dumping margin that way

This is now a global problem

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The more developed the country, the more likely they are to dump

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Safeguards – the nuclear option

A duty or quota imposed against all trading partners to offset a surge in imports which threatens the industry

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The initiation test

  • Surge in imports
  • As a result of unforeseen developments
  • The surge must be sudden, sharp, recent and significant
  • Industry must experience serious injury
  • The injury must be caused by both the surge and the

unforeseen developments

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Implementation of duties

  • Protection only in place for 3 years
  • Level of protection must reduce each year
  • Countries accounting for less than 3% of

imports are exempted

  • Difficult to implement on broad tariff codes
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SLIDE 24 $1 500 $1 700 $1 900 $2 100 $2 300 $2 500 $2 700 $2 900 $3 100 500 1 000 1 500 2 000 2 500 3 000 3 500 4 000 4 500 5 000 May 14 to Apr 15 May 15 to Apr 16 May 16 to Apr 17

2 000 tons 2 800 tons 4 300 tons $2 904 per ton $2 328 per ton $2 042 per ton

7326.20.90 - ARTICLES OF IRON OR STEEL: Other Articles Of Iron Or Steel:

  • - Articles Of Iron Or Steel Wire:
  • - - Other
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7326.20.90 - ARTICLES OF IRON OR STEEL: Other Articles Of Iron Or Steel:

  • - Articles Of Iron Or Steel Wire:
  • - - Other

General rate of duty 15% EU rate of duty Free Bound rate 15%

  • Duty increase is not possible
  • Anti-dumping or safeguard could be considered

Imports for May 2016 to April 2017

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Simultaneous actions?

Anti-dumping and safeguard applications can be brought simultaneously, but the duties will be implemented sequentially

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Circumvention

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Illegal circumvention

  • Undervaluation of goods
  • Incorrect declaration of origin
  • Manipulation of the tariff classification
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When illegal circumvention happens, the exporter receives the full proceeds

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Legal circumvention

  • Minor modifications of the product
  • Exporting parts, components or sub-assemblies
  • The absorption of the duty by the exporter
  • Country hopping
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Circumvention can be addressed through anti- circumvention reviews

If brought within 12 months of the duty being implemented, no new injury information is required

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Rebates

You should only pay duty on product you can purchase locally and which is consumed in SACU

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Rebates

Export rebates allow raw materials to be imported, converted and then exported

  • utside of SACU without paying

the duty

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Rebates

A special steel export rebate may need to be created to cater for the industry’s unique circumstances

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Rebates

Industrial rebates allow duty to be rebated for a particular purpose or grade

Similar process of application to a duty increase

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Rebates

Temporary rebates allow duties to be suspended while the product is not available locally

Similar process of application to a duty increase

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Priorities to achieve protection

  • Know the tariff codes of every product you manufacture
  • Split broad tariff codes into specific subheadings
  • Monitor your trade statistics
  • Focus on tariff codes not whole product ranges
  • Co-operate to solve the big problems
  • Apply for rebates of duty where applicable
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