2. Báo cáo điều tra sơ bộ - Eng

PUBLIC RECORD
CUSTOMS ACT 1901 - PART XVB
STATEMENT OF ESSENTIAL FACTS

NO. 550
ALLEGED DUMPING OF
PRECISION PIPE AND TUBE STEEL
EXPORTED TO AUSTRALIA FROM
THE PEOPLE’S REPUBLIC OF CHINA,
THE REPUBLIC OF KOREA, TAIWAN AND
THE SOCIALIST REPUBLIC OF VIETNAM
AND
ALLEGED SUBSIDISATION OF
PRECISION PIPE AND TUBE STEEL
EXPORTED TO AUSTRALIA FROM
THE PEOPLE’S REPUBLIC OF CHINA AND
THE SOCIALIST REPUBLIC OF VIETNAM
1 June 2021
SEF 550 Precision pipe and tube steel – China, Korea, Taiwan and Vietnam
PUBLIC RECORD
CONTENTS
CONTENTS ...............................................................................................................................................................2
ABBREVIATIONS.......................................................................................................................................................6
1 SUMMARY AND RECOMMENDATIONS............................................................................................................8
1.1 PRELIMINARY FINDINGS .............................................................................................................................................8
1.2 AUTHORITY TO MAKE DECISION...................................................................................................................................8
1.3 FINDINGS AND CONCLUSIONS ...................................................................................................................................10
2 BACKGROUND ..............................................................................................................................................14
2.1 INITIATION............................................................................................................................................................14
2.2 PREVIOUS CASES ....................................................................................................................................................14
2.3 CONDUCT OF THE INVESTIGATION .............................................................................................................................14
2.4 SUBMISSIONS RECEIVED FROM INTERESTED PARTIES ......................................................................................................16
2.5 PRELIMINARY AFFIRMATIVE DETERMINATION ...............................................................................................................17
2.6 RESPONDING TO THIS SEF .......................................................................................................................................17
3 THE GOODS, LIKE GOODS AND THE AUSTRALIAN INDUSTRY .........................................................................19
3.1 PRELIMINARY FINDING ............................................................................................................................................19
3.2 LEGISLATIVE FRAMEWORK .......................................................................................................................................19
3.3 THE GOODS ..........................................................................................................................................................19
3.4 LIKE GOODS ..........................................................................................................................................................22
3.5 CONCLUSION ........................................................................................................................................................25
3.6 MODEL CONTROL CODES .........................................................................................................................................25
4 THE AUSTRALIAN INDUSTRY .........................................................................................................................28
4.2 LEGISLATIVE FRAMEWORK .......................................................................................................................................28
4.3 AUSTRALIAN INDUSTRY ...........................................................................................................................................28
4.4 SUBMISSIONS RECEIVED IN RESPECT OF THE AUSTRALIAN INDUSTRY .................................................................................28
4.5 PRODUCTION PROCESS ............................................................................................................................................31
4.6 COMMISSIONER’S ASSESSMENT ................................................................................................................................32
5 AUSTRALIAN MARKET...................................................................................................................................33
5.2 BACKGROUND .......................................................................................................................................................33
5.3 MARKET STRUCTURE ..............................................................................................................................................33
5.4 PRICING ...............................................................................................................................................................34
5.5 MARKET SIZE ........................................................................................................................................................35
5.6 COMMISSION’S ASSESSMENT....................................................................................................................................36
6 DUMPING INVESTIGATION............................................................................................................................38
6.2 LEGISLATIVE AND POLICY FRAMEWORK .......................................................................................................................38
6.3 PARTICULAR MARKET SITUATION ...............................................................................................................................40
6.4 PROPER COMPARISON OF DOMESTIC AND EXPORT PRICES ...............................................................................................46
6.5 CONSTRUCTED NORMAL VALUES – CHINA ...................................................................................................................56
6.6 EXPORTERS ...........................................................................................................................................................59
6.7 DUMPING ASSESSMENT – CHINA ..............................................................................................................................65
6.8 DUMPING ASSESSMENT – KOREA ..............................................................................................................................69
6.9 DUMPING ASSESSMENT – TAIWAN ............................................................................................................................71
6.10 DUMPING ASSESSMENT - VIETNAM ...........................................................................................................................76
7 SUBSIDY INVESTIGATION ..............................................................................................................................87
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7.2 RELEVANT LEGISLATION ...........................................................................................................................................87
7.3 INVESTIGATED PROGRAMS .......................................................................................................................................89
7.4 INFORMATION CONSIDERED BY THE COMMISSION ........................................................................................................95
7.5 SUBSIDY ASSESSMENT – CHINA ................................................................................................................................96
7.6 SUBSIDY ASSESSMENT – VIETNAM .............................................................................................................................98
7.7 SUMMARY OF SUBSIDY MARGINS ..............................................................................................................................99
7.8 VOLUME OF SUBSIDISED IMPORTS ...........................................................................................................................102
7.9 LEVEL OF SUBSIDISATION .......................................................................................................................................102
8 ECONOMIC CONDITION OF THE INDUSTRY..................................................................................................104
8.1 PRELIMINARY FINDING ..........................................................................................................................................104
8.2 APPROACH TO INJURY ANALYSIS ..............................................................................................................................104
8.3 VOLUME EFFECTS.................................................................................................................................................105
8.4 PRICE EFFECTS .....................................................................................................................................................106
8.5 PROFIT AND PROFITABILITY ....................................................................................................................................107
8.6 OTHER ECONOMIC FACTORS ...................................................................................................................................108
9 HAS DUMPING AND/OR SUBSIDIES CAUSED MATERIAL INJURY?.................................................................113
9.1 PRELIMINARY ASSESSMENT ....................................................................................................................................113
9.2 LEGISLATIVE FRAMEWORK .....................................................................................................................................113
9.3 APPROACH TO CAUSATION ANALYSIS ........................................................................................................................113
9.4 SIZE OF DUMPING AND SUBSIDY MARGINS .................................................................................................................114
9.5 CUMULATION OF INJURY .......................................................................................................................................115
9.6 VOLUME EFFECTS.................................................................................................................................................115
9.7 PRICE EFFECTS .....................................................................................................................................................117
9.8 PROFIT EFFECTS ...................................................................................................................................................119
9.9 OTHER ECONOMIC FACTORS ...................................................................................................................................119
9.10 FACTORS OTHER THAN DUMPING AND SUBSIDISATION CAUSING INJURY...........................................................................120
9.11 MATERIALITY OF INJURY ........................................................................................................................................121
9.12 PRELIMINARY FINDINGS .........................................................................................................................................121
10 WHETHER DUMPING AND/OR SUBSIDISATION MAY CONTINUE..................................................................123
10.2 INTRODUCTION ...................................................................................................................................................123
10.3 WHETHER DUMPING AND SUBSIDISATION MAY CONTINUE ............................................................................................123
10.4 COMMISSIONER’S ASSESSMENT ..............................................................................................................................124
11 NON-INJURIOUS PRICE................................................................................................................................125
11.1 PRELIMINARY ASSESSMENT ....................................................................................................................................125
11.2 INTRODUCTION ...................................................................................................................................................125
11.3 LEGISLATIVE FRAMEWORK .....................................................................................................................................125
11.4 LESSER DUTY RULE...............................................................................................................................................126
11.5 CALCULATION OF THE NON-INJURIOUS PRICE .............................................................................................................126
11.6 SUBMISSIONS RECEIVED IN RESPECT OF THE NON-INJURIOUS PRICE.................................................................................127
11.7 COMMISSION’S ASSESSMENT .................................................................................................................................127
12 PROPOSED MEASURES ................................................................................................................................129
12.2 FORMS OF DUMPING DUTY AVAILABLE .....................................................................................................................129
12.3 SUBMISSIONS RECEIVED IN RESPECT OF FORM OF MEASURES.........................................................................................130
12.4 COMMISSION’S CONSIDERATION .............................................................................................................................130
12.5 PROPOSED RECOMMENDATIONS .............................................................................................................................132
13 PRELIMINARY AFFIRMATIVE DETERMINATION ............................................................................................133
13.1 INTRODUCTION ...................................................................................................................................................133
13.2 FINDING.............................................................................................................................................................133
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13.3 SECURITIES .........................................................................................................................................................133

14 TERMINATION.............................................................................................................................................135
APPENDICES AND ATTACHMENTS ........................................................................................................................136
APPENDIX A ASSESSMENT OF PARTICULAR MARKET SITUATION – CHINA .....................................................138
A1 THE GOC ROLE IN THE CHINESE STEEL MARKET ...........................................................................................138
A1.1 OVERVIEW..............................................................................................................................................138
A1.2 GOC POLICIES AFFECTING THE STEEL INDUSTRY......................................................................................138
A1.3 INITIATIVES INFLUENCING CHINESE STEEL MARKETS...............................................................................138
A1.4 INDUSTRY PLANNING GUIDELINES AND DIRECTIVES ...............................................................................140
A1.5 ROLE AND OPERATION OF SOES .............................................................................................................144
A1.6 THE ROLE OF THE GOC IN PRIVATE FIRMS ...............................................................................................145
A1.7 DIRECT AND INDIRECT FINANCIAL SUPPORT ...........................................................................................146
A1.8 TAXATION ARRANGEMENTS ...................................................................................................................146
A2 COMPETITION IN CHINESE STEEL MARKETS.................................................................................................148
A3 GOC INFLUENCE ON THE CHINESE MARKET FOR THE GOODS.......................................................................149
A3.1 COMPARISON OF RAW MATERIAL PRICES...............................................................................................149
APPENDIX B ASSESSMENT OF PARTICULAR MARKET SITUATION – VIETNAM ................................................153
B1 INTRODUCTION...........................................................................................................................................153
B2 THE GOV ROLE IN THE VIETNAMESE STEEL MARKET ....................................................................................154
B2.1 ELECTRICITY PRICES ................................................................................................................................154
B2.2 STEEL MASTER PLANS .............................................................................................................................155
B2.3 GOVERNMENT POLICIES AND DIRECTIVES – INDUSTRIAL DEVELOPMENT STRATEGY...............................157
B2.4 STATE OWNERSHIP OF LARGE STEEL TUBE PRODUCERS ..........................................................................157
B2.5 GOV PRICE STABILISATION......................................................................................................................158
B2.6 GOV CONTROL OVER PROJECTS AND INVESTMENTS ...............................................................................159
B2.7 VIETNAMESE STEEL INDUSTRY SUBSIDISATION.......................................................................................160
B3 COMPETITION IN VIETNAMESE STEEL MARKETS..........................................................................................161
B4 GOV INFLUENCE ON THE VIETNAMESE PRECISION PIPE AND TUBE STEEL MARKET ......................................162
APPENDIX C ASSESSMENT OF ALLEGED SUBSIDY PROGRAMS .......................................................................164
C1 INTRODUCTION...........................................................................................................................................164
C1.1 DEFINITION OF GOVERNMENT, PUBLIC AND PRIVATE BODIES ................................................................164
C1.2 GOVERNMENT........................................................................................................................................164
C1.3 PUBLIC BODIES .......................................................................................................................................164
C1.4 PRIVATE BODIES .....................................................................................................................................165
C2 ASSESSMENT OF PROGRAMS – CHINA.........................................................................................................166
C2.1 PROGRAM 20 – HOT ROLLED STEEL PROVIDED BY GOVERNMENT AT LESS THAN FAIR MARKET VALUE...166
C2.2 OTHER PROGRAMS.................................................................................................................................168
C3 ASSESSMENT OF PROGRAMS – VIETNAM....................................................................................................174
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C3.1 PROGRAMS REPEALED AS PART OF VIETNAM’S ACCESSION TO THE WTO ...............................................174

C3.2 CORPORATE INCOME TAX PROGRAMS ...................................................................................................175
C3.3 IMPORT DUTY PREFERENCES ..................................................................................................................178
C3.4 OTHER PROGRAMS.................................................................................................................................180
C3.5 REMAINING PROGRAMS WHERE NO SUBSIDY WAS FOUND....................................................................186
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ABBREVIATIONS
2013 Vietnam Subsidy Notice New and Full Notification Pursuant to Article XVI.1 of the GATT and
Article 25 of the Agreement on Subsidies and Countervailing Measures
published in March 2013
2020 Vietnam Subsidy Notice New and Full Notification Pursuant to Article XVI.1 of the GATT and
Article 25 of the Agreement on Subsidies and Countervailing Measures
published in February 2020
ABF Australian Border Force
ADN Anti-Dumping Notice
The Act Customs Act 1901
The applicant Orrcon Manufacturing Pty Ltd
Austube Mills Austube Mills Pty Ltd
BlueScope BlueScope Steel Limited
CBSA Canada Border Services Agency
CBSA Cold-rolled steel case CBSA investigation into the subsidising of cold-rolled steel from China,
South Korea and Vietnam
CBSA Copper pipe case CBSA investigation into the subsidising of certain copper pipe fittings
originating in the Socialist Republic of Vietnam
CBSA COR case CBSA investigation into the subsidising of certain corrosion-resistant
steel sheet originating in Turkey, the United Arab Emirates and Vietnam
CBSA Oil tubes case CBSA investigation into the subsidising of certain oil country tubular
goods originating in or exported from India, Indonesia and Vietnam
China the People’s Republic of China
CDI Chinh Dai Industrial Co., Ltd.
CDT Chinh Dai Steel Technology Co., Ltd
the Commission the Anti-Dumping Commission
the Commissioner the Commissioner of the Anti-Dumping Commission
CTM Cost to make
CTMS Cost to make and sell
CON 550 Consideration Report No. 550
DITH DITH Australia Pty Ltd
Dalian Steelforce Dalian Steelforce Hi-Tech Co., Ltd
Dumping Duty Act Customs Tariff (Anti-Dumping) Act 1975
EPR Electronic public record
Five Steel Five Steel (Tianjin) Tech Co., Ltd
FOB Free on board
GAAP Generally accepted accounting principles
GOC Government of China
the goods the goods (also referred to as the goods under consideration or GUC) as
defined in chapter 3.5.1
GOV Government of Vietnam
Hoa Phat Binh Duong Hoa Phat Binh Duong Steel Pipe Co., Ltd
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Hoa Phat Da Nang Hoa Phat Da Nang Steel Pipe Co., Ltd
Hoa Phat Long An Hoa Phat Long An Steel Pipe Co., Ltd
Hoa Phat Steel Hoa Phat Steel Pipe Co., Ltd
HRC hot rolled coil
HSS hollow structural sections
HSS countries China, Korea, Malaysia, Taiwan and Thailand
JFE JFE Shoji Australia Pty Ltd
Korea the Republic of Korea
M&H M&H Vietnam Trading and Services Co., Ltd.
MT metric tonnes
the Manual Anti-Dumping Commission Dumping and Subsidy Manual (November
2018)
the Minister the Minister for Industry, Science and Technology
Nguyen Minh Steel Nguyen Minh Steel Group Joint Stock Company
NIP non-injurious price
Orrcon Orrcon Manufacturing Pty Ltd
PAD Preliminary Affirmative Determination
the PAD Direction Customs (Preliminary Affirmative Determinations) Direction 2015
RCR RCR International Pty Ltd
REQ response to exporter questionnaire
REV 529 Review 529 into hollow structural sections from China, Korea, Malaysia,
Taiwan and Thailand
RHS rectangular or square hollow sections
ROI return on investment
SEF statement of essential facts
SOE State-owned Enterprise
Steelforce Australia Steelforce Australia Pty Ltd
the subject countries China, Korea, Taiwan and Vietnam
Ta Fong Ta Fong Steel Co., Ltd
Thailand the Kingdom of Thailand
TRAV Trade Remedies Authority of Vietnam
USP unsuppressed selling price
Vietnam the Socialist Republic of Vietnam
Vina One Vina One Steel Manufacturing Corporation
WTO World Trade Organization
Yantai Aoxin Yantai Aoxin International Trade Co., Ltd
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1 SUMMARY AND RECOMMENDATIONS

1.1 Preliminary findings
This statement of essential facts (SEF) No. 550 has been prepared in response to an
application by Orrcon Manufacturing Pty Ltd (Orrcon) lodged with the Commissioner of
the Anti-Dumping Commission (the Commissioner) seeking the publication of a dumping
duty notice in respect of precision pipe and tube steel (the goods) exported to Australia
from the People’s Republic of China (China), the Republic of Korea (Korea), Taiwan and
the Socialist Republic of Vietnam (Vietnam) (collectively, the subject countries) and a
countervailing duty notice in respect of the goods exported to Australia from China and
Vietnam.
Orrcon, the sole member of the Australian industry manufacturing like goods, claims that
it suffered material injury as a result of dumped and subsidised imports of the goods.
The Commissioner has found that the goods exported by:
 Chinese exporters were at dumped and subsidised prices.

 Korean exporters were at dumped prices.
The Commissioner has also found that dumped and subsidised exports from China and
dumped exports from Korea have caused material injury to the Australian industry for like
goods.
The Commissioner did not find that the goods exported by Taiwanese or Vietnamese
exporters were dumped. In respect of Vietnam, exports of the goods by cooperative and
residual exporters were not subsidised and for non-cooperative entities, exports of the
goods were subsidised, albeit at negligible levels.
Based on these preliminary findings and, subject to any further submissions received in
response to this SEF, the Commissioner proposes to:
 recommend that the Minister for Industry, Science and Technology (the Minister)
publish a dumping duty notice in respect of all exports of the goods from Chinese
and Korean exporters;
 recommend that the Minister publish a countervailing duty notice in respect of all
exports of the goods from Chinese exporters; and
 terminate this investigation, in so far as it relates to all Taiwanese and Vietnamese
exporters.
1.2 Authority to make decision

Division 2 of Part XVB of the Customs Act 19011 (the Act) describes, among other things,
the procedures to be followed and the matters to be considered by the Commissioner
1 All legislative references in this report are to the Customs Act 1901, unless otherwise stated.
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when conducting investigations in relation to goods covered by an application under

section 269TB(1).
1.2.1 Application
On 16 March 2020, Orrcon lodged an application alleging that the Australian industry for
like goods has suffered material injury caused by the goods exported to Australia from
China and Vietnam at dumped and subsided prices, and from Korea and Taiwan at
dumped prices.
Having considered the application, the Commissioner decided not to reject the application
and initiated Investigation 550 on 31 March 2020.
Consideration Report No. 550 (CON 550) and Anti-Dumping Notice (ADN) No. 2020/050
provide further details relating to the initiation of the investigation.2
1.2.2 Preliminary affirmative determination
In accordance with section 269TD, the Commissioner may make a preliminary affirmative
determination (PAD) if satisfied that there appears to be sufficient grounds for the
publication of a dumping duty notice or a countervailing duty notice, or if satisfied that it
appears that there will be sufficient grounds for the publication of such a notice
subsequent to the importation of the goods into Australia.
Where a PAD is not made 60 days after initiation of the investigation, the
Customs (Preliminary Affirmative Determinations) Direction 2015 (PAD Direction) directs
the Commissioner to publish a status report providing reasons why a PAD was not made.
On 1 June 2020, being 60 days after the initiation of the investigation, the Commissioner
published a status report.3
As required by section 9 of the PAD Direction, if the Commissioner has published a status
report in relation to an investigation, the Commissioner must reconsider whether or not to
make a PAD at least once prior to the publication of the SEF.
The Commissioner has reconsidered whether to make a PAD, and decided to do so in

conjunction with publishing this SEF. This is discussed in chapter 13.
1.2.3 Statement of essential facts
The Commissioner must, within 110 days after the initiation of an investigation, or such
longer period as the Minister allows under section 269ZHI(3)4, place on the public record
a SEF on which the Commissioner proposes to base a recommendation to the Minister in
relation to the application.5
2 Electronic public record (EPR) 550, Items 2 and 3.

3 EPR 550, Item 17.
4 This power has been delegated to the Commissioner. See ADN No. 2017/10.
5 Section 269TDAA(1).
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In formulating the SEF, the Commissioner must have regard to the application, and any
submissions concerning publication of the notice that are received by the Commissioner
within 37 days after the date of initiation of the investigation.6 The Commissioner may also
have regard to any other matters considered relevant.7
The SEF was originally due to be placed on the public record by 20 July 2020. However,
the due date for the SEF was extended.8 The Commissioner is now required to place the
SEF on the public record by 1 June 2021.
1.2.4 Report to the Minister
The Commissioner’s report in relation to this investigation was initially due to be provided
to the Minister on, or before, 2 September 2020. However, this due date was extended.9
The report and recommendations must now be provided to the Minister on, or before,
23 July 2021,10 unless the investigation is terminated earlier.
1.3 Findings and conclusions

The Commissioner’s preliminary findings and conclusions in this SEF are based on
available information at this stage of the investigation. A summary is provided below and
there is greater detail in the remainder of this report.
1.3.1 The goods and like goods and the Australian industry (chapters 3 and 4)
The Commissioner considers that locally produced precision pipe and tube steel are ‘like’
to the goods. The Commissioner is also satisfied that there is an Australian industry
producing like goods, comprising solely of Orrcon.
The like goods manufactured by Orrcon are discussed in chapters 3 and 4 of this report
and its verification report11. As a result of the Anti-Dumping Commission’s (the
Commission) inquiries, the Commissioner proposes to:
 recommend an exemption under sections 8(7)(a) and 10(8)(a) of the Customs

Tariff (Anti-Dumping) Act 1975 (Dumping Duty Act) for ‘air heater tubes to
Australian Standard (AS) 2556, up to and including 101.6 mm outside diameter’,
from any anti-dumping measures on the basis of the Commission’s finding that
Orrcon does not offer like or directly competitive goods for sale in Australia12; and
6 Section 269TDAA(2)(a).
7 Section 269TDAA(2)(b).
8 EPR 550, Items 19, 41 and 43.
9 Ibid.
10 Under section 269TEA.
11 EPR 550, Item 56.
12 In the event that Orrcon (or another Australian industry member) offers like or directly competitive goods
for sale in Australia to all purchasers on equal terms under like conditions having regard to the custom and
usage of trade, an application may be made to have this exemption revoked.
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 clarify that the goods description applicable for any anti-dumping measures in
respect of the thickness for rectangular and square products is limited to goods
with a nominal thickness of less than 1.6 mm.
1.3.2 The Australian market (chapter 5)
The Australian market for the goods and like goods is supplied from local production by
Orrcon and by imports from several countries, including the subject countries.
1.3.3 Dumping margins (chapter 6)
The Commission’s assessment of dumping margins is set out in the table below.
Country Exporter Dumping Margin (%)

China Dalian Steelforce 2.9
Uncooperative exporters 2.9
Korea Uncooperative exporters 6.2
Taiwan Ta Fong - 9.0
Uncooperative exporters - 8.6
Vietnam CDI - 12.2
Vina One - 12.0
Residual exporters - 6.5
Table 1 – Dumping Margins
1.3.4 Subsidy margins (chapter 7)
The Commission’s assessment of subsidy margins is set out in the table below.
Country Entity Subsidy Margin (%)

Non-cooperative entities 51.6
Vietnam CDI 0
Vina One 0
Residual exporters 0
Non-cooperative entities 0.01
Table 2 – Subsidy Margins
1.3.5 The economic condition of the Australian industry (chapter 8)
The Commissioner is preliminarily satisfied that the Australian industry experienced injury
to its volumes, price and profit as well as other economic indicators during the
investigation period.
1.3.6 Material injury caused by dumped and subsidised goods (chapter 9)
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The Commissioner has found that dumped and subsidised exports of the goods from
China and dumped exports of the goods from Korea caused material injury to the
Australian industry.
1.3.7 Whether dumping and subsidisation may continue (chapter 10)
The Commission is preliminarily satisfied that dumping and subsidisation may continue in
relation to the export of the goods by exporters from China and dumping may continue in
relation to the export of goods by exporters from Korea.
1.3.8 Non-injurious price (chapter 11)
The Commissioner is satisfied that there is a situation in the Chinese domestic market
that renders domestic selling prices unsuitable for determining normal value under section
269TAC(1). This provides an exception to the Minister’s mandatory consideration of the
lesser duty rule. Accordingly, in relation to China, the Commissioner proposes to
recommend that the Minister is not required to have regard to the lesser duty rule for the
purposes of sections 8(5BA) and 10(3D) of the Dumping Duty Act, noting that the Minister
may still do so.
In addition, the Commission has calculated that the non-injurious price (NIP) is not less
than the normal values ascertained for exporters from Korea. The Commissioner
recommends that the Minister have regard to the desirability of the lesser duty rule.
However, based on the fact that the NIP is not less than the normal value, the lesser duty
rule will have no practical effect (i.e. the NIP will not be operative).
1.3.9 Proposed measures (chapter 12)
The Commissioner proposes to recommend to the Minister that anti-dumping measures,

using the ad valorem duty method, be imposed in the form of:
 a dumping duty notice in respect of dumping duty that may become payable by
importers of the goods from China and Korea; and
 a countervailing duty notice in respect of countervailing duty that may become
payable by importers of the goods from China.
In this investigation, it was found that a less than adequate remuneration (LTAR) subsidy
was available under Program 20 in respect of hot rolled coil (HRC). HRC was a cost input
used in constructing the normal value for Chinese exporters (see chapter 6.5).
Accordingly, as exporters from China are subject to both a dumping and countervailing
duty, it is necessary to calculate the effective rate of interim dumping duty (IDD) by
‘backing out’ the subsidy margin attributed to Program 20 and applying interim
countervailing duty (ICD).
A summary of the proposed recommendations and effective rates of interim duty are
shown in the table below.
Exporter Proposed duty Rate of ICD Rate of IDD Combined rate of

method (%) (%) ICD and IDD (%)
Dalian Steelforce (China) Ad valorem 9.0 0.0 9.0
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All other Exporters Ad valorem 51.6 0.0 51.6

(China)
All Exporters (Korea) Ad valorem N/A 6.2 6.2
Table 3 – Summary of proposed effective interim dumping and countervailing duty
1.3.10 Preliminary affirmative determination (chapter 13)
As part of this SEF, the Commissioner, after having regard to the application, the
submissions received and other relevant information, has determined that it is appropriate
to make PAD. Pursuant to section 269TD(1)(a), the Commissioner is satisfied that there
appears to be sufficient grounds for the publication of:
 a dumping duty notice in respect of the goods exported to Australia by all exporters
from China and Korea; and
 a countervailing duty notice in respect of the goods exported to Australia by all
exporters from China.
As a result, the Commissioner has made a PAD, pursuant to section 269TD. Securities
will be taken in relation to ICD and IDD that may become payable for imports of the goods
that are entered for home consumption from 2 June 2021.
1.3.11 Termination (chapter 14)
Section 269TDA provides for when the Commissioner must terminate an investigation.
Subject to any submissions received in response to this SEF, the Commissioner

proposes to terminate:
 the dumping investigation in relation to all exporters from Taiwan and Vietnam, on
the basis that there has been no dumping of any of the goods, in accordance with
section 269TDA(1)(b)(i); and
 the countervailing investigation in relation to all exporters from Vietnam, on the
basis that:
o in respect of CDI, Vina One and residual exporters, no countervailable
subsidy has been received in respect of any of those goods pursuant to
o in respect of non-cooperative entities, a countervailable subsidy has been
received in respect of some or all of those goods but it never, at any time
during the investigation period, exceeded the negligible level, pursuant to
section 269TDA(2)(b)(ii).
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2 BACKGROUND
2.1 Initiation
On 16 March 2020, Orrcon lodged an application with the Commissioner under section
269TB(1) seeking the publication of a dumping duty notice in respect of the goods
exported to Australia from China, Korea, Taiwan and Vietnam, and a countervailing notice
in respect of the goods from China and Vietnam.
Having considered the application, the Commissioner decided not to reject the application
and initiated Investigation 550 on 31 March 2020. Public notification of the initiation was
also made on 31 March 2020. CON 550 and ADN No. 2020/030 provide further details
relating to the initiation of the investigation.13
In respect of this investigation:
 the investigation period for the purpose of assessing dumping and subsidisation is
1 January 2019 to 31 December 2019; and
 the injury analysis period for the purpose of determining whether material injury to
the Australian industry has been caused by exports of dumped and subsidised
goods is from 1 January 2016.
2.2 Previous cases

There have been no previous cases in relation to precision pipe and tube steel exported
to Australia.
2.3 Conduct of the investigation

2.3.1 Statement of essential facts
The initiation notice advised that the SEF would be placed on the public record by
20 July 2020. However, the due date for the SEF was extended.14 In the most recent
extension, as advised in ADN No. 2021/064, the Commissioner approved an extension of
time for the publication of the SEF until 1 June 2021.
2.3.2 Australian industry
The Commissioner is satisfied that the applicant for the investigation, represents the
Australian industry producing like goods to the goods the subject of the investigation.
2.3.3 Importers
The Commission identified several importers in the Australian Border Force (ABF) import
database that imported the goods from China, Korea, Taiwan and Vietnam during the
investigation period. The Commission forwarded importer questionnaires to 27 importers
13 EPR 550, Items 2 and 3.

14 EPR 550, Items 19, 41, 43 and 55.
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and placed a copy of the importer questionnaire on the Commission’s website for
completion by other importers who were not contacted directly.
Desktop verifications were undertaken for the following importers:
 Steelforce Australia Pty Ltd (Steelforce Australia) importing from China

 DITH Australia Pty Ltd (DITH), importing from Korea
 Austube Mills Pty Ltd (Austube Mills) importing from Taiwan
 RCR International Pty, importing from Vietnam.
Verification reports relating to each importer are available on the public record.
Responses were received from the following importers, however the Commission elected
not to conduct a verification of the data in this instance:
 B&D Metals Group Pty Ltd (Vietnam)

 Marubeni Itochu Steel Oceania Pty Ltd (Vietnam)
 Focus Steel Pty Ltd (China)
 Kuredale Pty Ltd (China).
2.3.4 Exporters
The Commission forwarded questionnaires to 29 suppliers identified from the ABF import
database at the beginning of the investigation. Five Steel (Tianjin) Tech Co Ltd,
completed a questionnaire response (REQ) prior to the due date of 7 May 2020. Thirteen
other entities were granted extensions to provide a REQ, with 12 responses received.
Responding entities are summarised below:
Questionnaire
Exporter name
submission date
China
Five Steel (Tianjin) Tech Co., Ltd (Five Steel) 01 May 2020
Yantai Aoxin International Trade Co., Ltd (Yantai Aoxin) 21 May 2020
Dalian Steelforce Hi-Tech Co., Ltd (Dalian Steelforce) 01 Jun 2020
Vietnam
Vina One Steel Manufacturing Corporation (Vina One) 15 Jun 2020
M&H Vietnam Trading and Services Co., Ltd. (M&H) 5 Jun 2020
Hoa Phat Binh Duong Steel Pipe Co., Ltd (Hoa Phat Binh Duong) 10 Jun 2020
Hoa Phat Steel Pipe Co., Ltd (Hoa Phat Steel) 10 Jun 2020
Hoa Phat Long An Steel Pipe Co., Ltd (Hoa Phat Long An) 10 Jun 2020
Hoa Phat Da Nang Steel Pipe Co., Ltd (Hoa Phat Da Nang) 10 Jun 2020
Chinh Dai Industrial Co., Ltd. (CDI) 9 Jun 2020
Chinh Dai Steel Technology Co., Ltd (CDT) 9 Jun 2020
Nguyen Minh Steel Group Joint Stock Company (Nguyen Minh Steel) 29 May 2020
Taiwan
Ta Fong Steel Co., Ltd (Ta Fong) 20 May 2020
Table 4 – Entities who provided a REQ
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2.3.5 Foreign Governments
The Commission forwarded questionnaires to the Government of China (GOC) and the
Government of Vietnam (GOV) at the beginning of the investigation. A response was
received from the GOV which has been considered by the Commissioner in reaching the
conclusions contained within this SEF.
No questionnaire response was received from the GOC.15
2.4 Submissions received from interested parties

The Commission received the following submissions from interested parties prior to the
publication of this SEF. These submissions have been considered by the Commissioner
in reaching the conclusions contained within this SEF.
Public Record
Interested Party Date Received
Item No.
004 Government of Vietnam 14/04/2020
005 Steelforce 14/04/2020
006 Orrcon 14/04/2020
007 Dalian Steelforce 28/04/2020
008 Vina One Steel 01/05/2020
009 JFE Shoji 01/05/2020
010 Orrcon 08/05/2020
011 RCR International 12/05/2020
012 Romak Hardware 12/05/2020
013 Hoa Phat Steel Pipe 20/05/2020
014 Orrcon 25/05/2020
018 M&H Vietnam 09/06/2020
021 Orrcon 04/08/2020
023 Hoa Phat Steel Pipe 04/08/2020
024 Nguyen Minh Steel 07/08/2020
038 Government of Vietnam 18/08/2020
039 Orrcon 19/08/2020
042 M&H Vietnam 20/01/2021
051 Orrcon 02/03/2021
052 CDI 19/03/2021
054 Orrcon 30/04/2021
15In a recent investigation, Investigation 553 – Painted Steel Strapping, the GOC provided a response to a
government questionnaire. Due to the similarities between Investigation 553 and this investigation, the
Commission has had regard to the response by the GOC to Investigation for the purposes of this investigation.
See chapter 6.4.4 for further discussion.
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Table 5 – Submissions considered in this SEF
2.5 Preliminary affirmative determination

In accordance with section 269TD(1), the Commissioner may make a PAD, if satisfied
that there appears to be sufficient grounds for the publication of a dumping duty notice or
a countervailing duty notice, or if it appears that there will be sufficient grounds for the
publication of such notices subsequent to the importation of the goods into Australia.
A PAD may be made no earlier than day 60 of the investigation (in relation to this
investigation, a date no earlier than 1 June 2020) and the Commonwealth may require
and take securities at the time a PAD is made or at any time during the investigation after
a PAD has been made, if the Commissioner is satisfied that it is necessary to do so to
prevent material injury to an Australian industry occurring while the investigation
continues.
In accordance with the PAD Direction, 60 days after the initiation of such an investigation,
the Commissioner must make a PAD or provide a Status Report outlining the reasons
why a PAD has not been made.
On 1 June 2020, the Commissioner published a Day 60 Status Report in ADN No.
2020/057.16 In that report, the Commissioner set out that he did not make a PAD because
he was not satisfied that, at that stage of the investigation, there appeared to be sufficient
grounds for the publication of a dumping duty or countervailing duty notice.
The PAD Direction also requires the Commissioner to reconsider making a PAD after the
publication of a status report, at least once prior to the publication of the SEF. In
preparing this SEF, the Commissioner has reconsidered whether to make a PAD in view
of the additional evidence available.
The Commissioner considers that the Commonwealth should take securities under
section 42 of the Act in respect of interim dumping and countervailing duty that may
become payable in relation to the goods exported to Australia from China and Korea.
The Commissioner is satisfied that securities are necessary to prevent material injury to
the Australian industry occurring while the investigation continues. A detailed discussion
of this is set out at Chapter 13 of this report.
Securities will apply to imports of the like goods from China and Korea entered for home
consumption on or after 2 June 2021.
2.6 Responding to this SEF

This SEF sets out the essential facts on which the Commissioner proposes to base the
final recommendations to the Minister.
This SEF represents an important stage in the investigation. It informs interested parties
of the facts established and allows them to make submissions in response to the SEF.
16 EPR 550, Item 17.
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It is important to note that the SEF may not represent the final views of the
Commissioner.
Interested parties have 20 days to respond to the SEF. The Commissioner will consider
these responses in making their final report to the Minister. The report will recommend
whether or not a dumping duty notice and/or a countervailing duty notice should be
published, and the extent of any interim duties that are, or should be, payable.
Responses to this SEF should be received by the Commissioner no later than

21 June 2021. The Commissioner is not obliged to have regard to any submission made
in response to the SEF received after this date, if to do so would, in the opinion of the
Commissioner, prevent the timely preparation of the report to the Minister.
The Commissioner must report to the Minister by 23 July 2021.
Submissions should preferably be emailed to: [email protected]
Alternatively, interested parties may post submissions to:
Director, Investigations 3
Anti-Dumping Commission
GPO Box 2013
Canberra ACT 2601
AUSTRALIA
Confidential submissions must be clearly marked accordingly and a non-confidential

version of any submission is required for inclusion on the public record.
A guide for making submissions is available at the Commission’s web site via:
www.adcommission.gov.au
The public record contains non-confidential submissions by interested parties, the non-
confidential versions of the Commission’s visit reports and other publicly available
documents.
Documents on the public record are intended to be considered in conjunction with this
SEF.
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3 THE GOODS, LIKE GOODS AND THE AUSTRALIAN

INDUSTRY
3.1 Preliminary finding
The Commission is satisfied that locally manufactured precision pipe and tube steel
comprises ‘like goods’ to the goods the subject of the application.
3.2 Legislative framework

Section 269TC(1) requires that the Commissioner must reject an application for a
dumping duty notice and a countervailing duty notice if, among other things, the
Commissioner is not satisfied that there is, or is likely to be established, an Australian
industry in respect of like goods.
In making this assessment, the Commissioner must firstly determine that the goods
produced by the Australian industry are “like” to the imported goods. Section 269T(1)
defines ‘like goods’ as:
goods that are identical in all respects to the goods under consideration or that,
although not alike in all respects to the goods under consideration, have
characteristics closely resembling those of the goods under consideration.
An Australian industry can apply for relief from injury caused by dumped or subsidised
imports, even if the goods it produces are not identical to those imported. The industry
must, however, produce goods that are “like” to the imported goods.
Where the locally produced goods and the imported goods are not alike in all respects,
the Commissioner assesses whether they have characteristics closely resembling each
other, having regard for the following considerations:
 physical likeness;
 commercial likeness;
 functional likeness; and
 production likeness.
3.3 The goods

3.3.1 The goods description in the application
The application defined the goods as:
Certain electric resistance welded pipe and tube made of carbon steel, whether or
not including alloys, comprising circular, rectangular and square hollow sections in
metallic coated and non-metallic coated finishes. Metallic finish types for the goods
include galvanised and aluminised. Non-metallic finishes include hot-rolled and cold-
rolled.
Sizes of the goods are, for circular products, those equal to or less than 21
millimetres (“mm”) in outside diameter. Also included are air heater tubes to
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Australian Standard (AS) 2556, up to and including 101.6 mm outside diameter. For
rectangular and square products, those with a thickness of less than 1.6 mm (being
a perimeter up to and including 260 mm).
Included within the goods are end-configurations such as plain, square-faced and
other (e.g. threaded, swaged and shouldered).
The goods include all electric resistance welded pipe and tube made of steel
meeting the above description of the goods (and inclusions), including whether the
pipe or tube meets a specific structural standard or is used in structural applications.
Oval and other shaped hollow sections which are not circular, rectangular or square,
are excluded from the goods.
The subject goods are covered by a range of Australian Standards, including but not
limited to: AS 1450 ‘Tube for Mechanical Purposes’, AS 2556 ‘ERW Steel Air Heater
Tubes’ and AS/NZS 2053.1 ‘Conduits and fitting for electrical installations – General
requirements.’ Precision pipe and tube steel is a light gauge product, with tight
dimensional tolerances used in structural customised applications such as gates and
fencing, furniture, racking and shelving, automotive components, conduit and heat
exchangers.
3.3.2 Tariff classification of the goods
The goods are generally, but not exclusively, classified to the following tariff subheadings
in Schedule 3 to the Customs Tariff Act 1995:17
Tariff Subheading Statistical Code Description

7306 OTHER TUBES, PIPES AND HOLLOW PROFILES (FOR EXAMPLE, OPEN SEAM
OR WELDED, RIVETED OR SIMILARLY CLOSED), OF IRON OR STEEL:
7306.30.00 Other, welded, of circular cross-section, of iron or non-alloy steel:
30 Not exceeding 21 mm external diameter
7306.50.00
45 Other, welded, of circular cross-section, of other alloy steel
7306.6 Other, welded, of non-circular cross-section
7306.61.00 Of square or rectangular cross-section, of iron or non-alloy steel, not exceeding
279.4 mm perimeter:
21 Wall thickness not exceeding 2 mm
7306.69.00 10 Of other non-circular cross-section
Table 6 – General tariff classification for the goods
17 These tariff classifications and statistical codes may include goods that are both subject and not subject to
the antidumping measures. The listing of these tariff classifications and statistical codes is for convenience
and reference only and does not form part of the goods description. Please refer to the goods description for
authoritative detail regarding goods subject to the anti-dumping measures.
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3.3.3 Submissions received on the goods description – Nominal thickness
In its submission of 23 April 2020,18 Dalian Steelforce stated that:
 the goods description captures goods already subject to anti-dumping measures,

specifically those applicable to hollow structural sections (HSS) exported to
Australia from China, Korea, Taiwan, Malaysia and the Kingdom of Thailand
(Thailand);
 rectangular or square hollow sections (RHS) with a nominal thickness of 1.6 mm or
greater and a perimeter up to and including 1277.3 mm is considered to be part of
the HSS goods description;
 HSS is generally produced to the Australian Standard AS 1163 or equivalent
international standards, and AS 1163 allows for a thickness tolerance of +/- 10 per
cent. RHS with a nominal thickness of 1.6 mm can therefore have an actual
thickness range from 1.44 mm to 1.76 mm, meaning that measures may already
technically apply to goods with an actual thickness of 1.44 mm and above;
 the description of the goods does not appear to limit the goods to precision pipe
only and includes “all electric resistance welded pipe and tube made of steel
pipe or tube meets a specific structural standard or is used in structural
applications;” and
 the goods description and the Commission’s consideration of Orrcon’s claims
concerning 1.6 mm non-circular precision pipe in CON 550 indicates that RHS
already subject to measures likely competes with the goods and could also be
considered to be ‘like goods’.
In its submission of 29 April 2020,19 Vina One requested that the Commission clarify that
in respect of RHS, the investigation is limited to tube products with a nominal thickness
less than 1.6 mm.
In their submissions of 20 and 25 May 2020 respectively,20 Hoa Phat Steel and Vina One
also observed that the goods description did not specify whether the referenced
dimensions were nominal or actual, making it difficult to accurately identify subject and
non-subject goods. Both Hoa Phat Steel and Vina One also stated that:
 other Australian producers exist and manufacture like goods, noting that in
investigations, reviews and continuation inquiries relating to HSS exported from
China, Korea, Taiwan, Malaysia and Thailand, the Australian industry included
manufacturers other than Orrcon; and
 the thickness of RHS does not define separate classes of goods, and all locally
produced structural RHS complying to AS1163 should be considered like goods.
18 EPR 550, Item 7.

19 EPR 550, Item 8.
20 EPR 550, Items 13 and 16.
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3.3.4 Commission’s assessment – Nominal thickness
In response to the concerns raised by Dalian Steelforce, Hoa Phat Steel and Vina One
regarding the scope of the goods under consideration and like goods, the Commission
published an issues paper21 inviting submissions from interested parties concerning:
 whether they use nominal or actual thickness when selling, supplying, declaring or
reporting on RHS (sold either in Australia or other markets which may include
reference to the relevant standards in their domestic country) and any reasons for
this;
 whether the thicknesses referred to in the description of the goods under
consideration are usefully intended to mean ‘nominal’ or ‘actual’ thickness; and
 whether there is a lack of clarity in classifying RHS of certain thicknesses.
The Commission received responses from Orrcon, Hoa Phat Steel, Nguyen Minh Steel
and Vina One.22 Each confirmed that they use nominal thickness when selling, supplying,
declaring or reporting on RHS, and the thickness parameters referred to in the goods
description were understood to refer to ‘nominal’ thickness.
Vina One and Hoa Phat Steel also stated that it is general practice within the steel
industry for customers to specify and order pipe and tubing products according to the
nominal dimensions relevant to the standards in their jurisdiction, and that both entities do
not record the actual thickness for domestic or exported subject goods. Moreover,
identification of actual thickness requires recording actual thickness of feed coil
purchased and consumed against each production lot. As the feed coil is subject to its
own tolerances, it is not practical to account for and record the actual thickness of each
production lot.
Based on submissions from interested parties, the Commission considers that the
thickness parameters for RHS referred to in the goods description for precision pipe and
tube steel (i.e. “those with a thickness of less than 1.6 mm”) are nominal. Interested
parties should therefore be able to accurately determine whether RHS of certain nominal
thicknesses should be classified as the goods under consideration or like goods. The
goods description for HSS is consistently distinguished following this interpretation
because it specifically excludes “precision RHS with a nominal thickness of less than
1.6 mm” [emphasis added].23
3.4 Like goods

An application can only be made if there exists an Australian industry producing ‘like
goods’ to the goods the subject of the application. The phrase ‘like goods’ is defined in
section 269T(1). Sections 269T(2), 269T(3), 269T(4), 269T(4A), 269T(4B) and 269T(4C)
21 Item 20 on the public record refers.

22 Items 24, 21, 22 and 23 on the public record refer.
23 The goods description for HSS can be found on the Commission’s Dumping Commodity Register at:
https://www.industry.gov.au/sites/default/files/adc/measures/dcr_-_hollow_structural_sections_3.pdf
22
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are relevant to determining whether the like goods are produced in Australia and whether
there is an Australian industry.24
The following analysis outlines the Commission’s assessment of whether the locally
produced goods are identical to, or closely resemble, the goods the subject of the
application and whether they are therefore like goods.
3.4.1 Submissions received on like goods – Air heater tubes

For circular products, the goods are limited to products equal to, or less than 21 mm in
outside diameter, except for products described as air heater tubes made to AS2556,
which are limited, up to and including 101.6 mm in outside diameter.
In a submission received 21 April 2020 from JFE Shoji Australia Pty Ltd (JFE), it was
alleged that Orrcon has not supplied air heater tubes for some time and potential
customers were advised that they would need to import these products.
3.4.2 Commission’s assessment – Air heater tubes

During verification, it was noted that Orrcon’s Australian sales for the investigation period
did not include goods fitting the description for air heater tubes. During verification, Orrcon
advised that it has the capability to supply precision pipe and tube matching this
description, but it does not currently do so.25
The Commission notes the following:
 the submission by JFE cites examples of potential Australian customers enquiring

with Orrcon for the supply of air heater tubes without success;
 the absence of any products matching the description for air heater tubes in
Orrcon’s Australian sales listing for the investigation period; and
 the absence of any products matching the description for air heater tubes (i.e.
those made to a standard of AS2556) in Orrcon’s Precision Product Catalogue.26
Accordingly, the Commission preliminarily considers that Orrcon does not offer like or
directly competitive goods to air heater tubes for sale in Australia.
Sections 8(7)(a) and 10(8)(a) of the Dumping Duty Act provide that the Minister may
exempt goods from interim dumping and interim countervailing duty and dumping and
countervailing duty if satisfied that like or directly competitive goods are not offered for
sale in Australia to all purchasers on equal terms under like conditions having regard to
the custom and usage of trade.
24 See Chapter 4 for further discussion on the Australian industry.

25 Orrcon provided additional information to the Commission in respect of air heater tubes shortly before
publication of this SEF. The Commission has not had regard to this information at this stage the Commission
considers doing so would prevent the timely placement of the SEF on the public record. The
Commission will examine this information as part of its preparation of the report to the Minister.
26 Available at https://www.orrconsteel.com.au/sites/default/files/2019-07/2016-precision-brochure.pdf
23
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In light of the Commission’s findings above, the Commission proposes to recommend the
Minister exempt from interim dumping and interim countervailing duty and dumping and
countervailing duty “air heater tubes to Australian Standard (AS) 2556, up to and
including 101.6 mm outside diameter”, subject to further submissions received on whether
like, or directly competitive goods, are offered for sale by the Australian industry. While
the investigation continues, (i.e. until such time as an exemption is granted), it is
necessary to take securities on air heater tubes for the purpose of the PAD discussed at
chapter 13.
The Commission notes that the proposed exemption of air heater tubes has been taken
into account by the Commission in its preparation of this SEF, including in chapters 3.4.3
to 3.4.7.
3.4.3 Physical likeness

The Commission has found that both the imported goods and the goods produced by the
Australian industry are physically alike in all aspects. Both are traded in a similar range of
grades, shapes, lengths and thicknesses, as specified in the goods description.
3.4.4 Commercial likeness

The Commission has found that the imported and locally produced goods are
commercially similar. Imported goods and goods produced by the Australian industry are
interchangeable and compete in the same market sectors, e.g. fencing and furniture
manufacturing, construction, etc. with direct head-to-head competition between them.
3.4.5 Functional likeness

The Commission has found that the imported and locally produced goods are functionally
alike, as they compete for sales to the same customers for similar (or the same) end-
uses. These end uses include fencing and gates, furniture, shop fittings, automotive
(original equipment and aftermarket), industrial hardware, general engineering, heat
exchangers and electrical conduits.
3.4.6 Production likeness

The Commission has found that the production processes and raw material inputs for the
imported and locally produced goods are alike in all significant practical aspects.27 HRC,
either bare, coated or galvanised, is the major raw material input.
3.4.7 Like goods assessment

Based on the findings above, the Commission considers that goods produced by the
Australian industry, other than those products described as air heater tubes, have
characteristics identical to, or closely resembling, the goods exported to Australia. The
Commission considers that:
27 See Chapter 4.5 for further discussion on the production process.
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 the goods and the domestically produced goods are physically alike, as they have
the same or similar the primary physical characteristics;
 the goods and the domestically produced goods are commercially alike, as they
are sold to common users and directly compete in the same market;
 the goods and the domestically produced goods are functionally alike, as they
have a similar range of end uses; and
 the goods and the domestically produced goods are manufactured in a similar
manner.
In light of the above, the Commissioner is satisfied that the Australian industry produces
‘like goods’ the subject of the application (other than air heater tubes) to the goods as
defined in section 269T.
3.5 Conclusion
3.5.1 Clarification of goods description
In light of the Commission’s findings regarding nominal thickness discussed in chapter

3.3.4, the Commission intends to clarify the goods description to include the word
‘nominal’, as follows:
Certain electric resistance welded pipe and tube made of carbon steel, whether or
not including alloys, comprising circular, rectangular and square hollow sections in
metallic coated and non-metallic coated finishes. Metallic finish types for the goods
include galvanised and aluminised. Non-metallic finishes include hot-rolled and cold-
rolled.
Sizes of the goods are, for circular products, those equal to or less than 21
millimetres (“mm”) in outside diameter. Also included are air heater tubes to
Australian Standard (AS) 2556, up to and including 101.6 mm outside diameter. For
rectangular and square products, those with a nominal thickness of less than
1.6 mm (being a perimeter up to and including 260 mm).
Included within the goods are end-configurations such as plain, square-faced and
other (e.g. threaded, swaged and shouldered).
The goods include all electric resistance welded pipe and tube made of steel
pipe or tube meets a specific structural standard or is used in structural applications.
Oval and other shaped hollow sections which are not circular, rectangular or square,
are excluded from the goods.
3.6 Model control codes

The Commission has used a model control code (MCC) structure in order to identify key
characteristics for, among other things, model matching when comparing export prices
and normal values (the basis for using a MCC structure and the Commission’s practice is
explained in ADN No. 2019/132). All interested parties participating in this inquiry were
requested to provide sales and cost data in accordance with the MCC structure detailed
in the table below:
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Category Sub-Category Identifier Sales Data Cost Data

1 Prime Prime P Mandatory Not
Non-Prime N applicable
2 Steel Base/Type Hot Roll H Mandatory Mandatory

* Batch Hot Dipped Galvanised Cold roll (Semi Bright) C
abbreviated as ‘Batch HDG’; Electro
Galvanised abbreviated as ‘EG’; Galvanised (Batch HDG,EG,CG or G
Continuously Galvanised abbreviated MSGB)
as ‘CG’; Mild Steel Galvabond as Other (e.g. alloy steel) A
‘MSGB’.
3 Steel Grade C200 1 Mandatory Mandatory
C250 2
C350 3
C450 4
Other 5
4 Surface Protection Oiled O Mandatory Mandatory
Clear or painted P
No oil or paint N
5 Coating Mass <20 g/m2 (including none) 1 Mandatory Mandatory
≥20 g/m2 to <100 g/m2 2
≥100 g/m2 to <275 g/m2 3
≥275 g/m2 4
6 Shape Circular C Mandatory Mandatory
Rectangular or Square R
7 Circular size Not circular N Mandatory Mandatory
* outside diameter ≤16 mm 1
** Circular products with an outside
>16 mm to ≤21 mm 2
diameter between >21 mm to ≤101.6
mm which are not air heater tubes >21 mm to ≤101.6 mm (Air Heater 3
are not the goods. Tubes)
8 Rectangular/Square/ Oval/Other Not rectangular/square N Mandatory Mandatory
size
≤40 mm 1
* outside perimeter
>40 mm to ≤80 mm 2
>80 mm to ≤260 mm 3
9 Thickness <1.6 mm A Mandatory Mandatory
≥1.6 mm to <3.2 mm B
≥3.2 mm C
10 Length ≤4 m 1 Mandatory Optional
>4m to ≤8 m 2
>8 m to ≤12.0 m 3
>12.0 m 4
11 End configuration Plain end P Optional Optional
Threaded/flanged/swaged T
Other (e.g. square faced) O
Table 7: MCC Structure
26
PUBLIC RECORD
Any changes to the proposed MCC structure, or alterations in terms of its application in
respect of each interested party, have been addressed in the relevant verification reports
available on the public record for this investigation.
3.6.1 Submissions received in respect of the MCC structure
In its submission of 14 April 2020,28 Steelforce Trading Pty Ltd (Steelforce Trading)29
stated that:
 the categorisation of the MCC Category 2 (Steel Base/Type) contains some

characteristics which are not mutually exclusive, in that a product could be
produced from hot rolled coil, as well as be galvanised and alloyed; and
 as a result, this category should be split into three distinct categories, being Coil
Production Method (Hot Rolled or Cold Rolled), Chemistry (Alloyed or Non-alloyed
and Finish (Oiled, Painted, Galvanised, Aluminised or None).
3.6.2 Commission’s assessment
In response to the concerns raised by Steelforce Trading regarding the MCC structure,
the Commission advised Steelforce Trading by email30 of the following:
 MCC Category 2 refers only to the raw material input, which could be for example,
hot rolled coil, cold rolled coil, pre-galvanised coil or another steel type (which
could, for instance, be an alloyed steel)
 galvanisation is addressed in Category 5 – Coating Mass. The MCC structure is
neutral with respect to the coating type, however a sufficiently galvanised product
would be categorised between 2 and 4 in Category 5.
 whether or not the goods are alloyed is irrelevant to the MCC structure.
As such, no change to the MCC structure was made.
3.6.3 Verification of MCCs
During the course of the verification of the subject exporters, the Commission identified in
some cases exporter specific amendments to the MCC structure. These amendments are
included in the exporter verification reports and are discussed in chapter 6.
28 EPR 550, Item 5.

29 Steelforce Trading has subsequently changed its name following the investigation period. It is now named
Austeel Trading Pty Ltd.
30 Confidential Attachment 1 – Email exchange between the Commission and Steelforce Trading.
27
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4 THE AUSTRALIAN INDUSTRY

The Commissioner is satisfied that there is an Australian industry, consisting wholly of
Orrcon, producing like goods, and that the like goods are wholly or partly manufactured in
Australia.

The Commissioner must be satisfied that the like goods are in fact produced in Australia.
Sections 269T(2) and 269T(3) specify that for goods to be regarded as being produced in
Australia, they must be wholly or partly manufactured in Australia. In order for the goods
to be considered as partly manufactured in Australia, at least one substantial process in
the manufacture of the goods must be carried out in Australia.
4.3 Australian industry

In its application, Orrcon claimed it is the only Australian manufacturer of the goods. No
further Australian industry manufacturers of the goods identified themselves to the
Commission following the initiation of the investigation, nor were any further Australian
industry manufacturers identified by the Commission during the investigation. This
includes examination of:
 whether known manufacturers of similar products also manufactured like goods; 31

and
 responses from other Australian market participants, similar to Orrcon, who
identified themselves as importers during the verification.
4.4 Submissions received in respect of the Australian industry

The Trade Remedies Authority of Vietnam (TRAV) had previously made a submission to
the Commission on 21 January 2020 in respect of another application for similar goods
(that application was subsequently withdrawn). At the request of the GOV, the submission
has been considered by the Commission in this investigation. In this submission, among
other things, TRAV submitted that Orrcon’s application might not comply with Article 4.1
of the Anti-Dumping Agreement (ADA), if Orrcon is not an Australian producer of like
goods to the goods under consideration.
Dalian Steelforce made a submission, published on 28 April 202032 alleging that

Australian industry members manufacturing HSS – Orrcon, Austube Mills Pty Ltd, and
Australian Pipe and Tube Pty Ltd state on their websites that they manufacture RHS and
SHS to dimensions and thicknesses that would meet the description of like goods. Dalian
31 Non-confidential Attachment 1 - Assessment of HSS manufacturers.

32 EPR 550, Item 7.
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PUBLIC RECORD
Steelforce raised the question as to the constitution of the Australian industry, the goods
and like goods, conditions of competition and inquiry and causal link assessments.
Hoa Phat Steel Pipe Co., Ltd (Hoa Phat Steel) and Vina One made submissions,
published on 20 May 202033 and 27 May 202034 respectively, regarding the goods, the
subject of the investigation. Both submitted that Orrcon’s application might not meet the
standards set out in section 269TB(4), which requires that an application must be
supported by a sufficiently representative percentage of the Australian industry.
4.4.1 Orrcon’s status as an Australian manufacturer
TRAV requested that the Commission verify Orrcon’s claim as the only Australian
manufacturer of precision pipe and tube steel.
TRAV also submitted that Orrcon has a relationship with a Vietnamese exporter of the
goods, through its parent company, BlueScope Steel Limited (BlueScope). BlueScope is
the owner of NS BlueScope Vietnam, a Vietnamese steel producer. In TRAV’s view if
Orrcon imported the goods from Vietnam, according to Article 4.1 of the ADA, Orrcon
would not be a producer of the goods, and accordingly, the investigation should be
terminated on the grounds of there being no domestic Australian producer (if it is
accepted there are no other domestic producers).
Sole Australian manufacturer of the goods
As noted in chapter 4.3, and further discussed in chapter 4.4.3, no further Australian
industry manufacturers of the goods identified themselves to the Commission following
the initiation of the investigation, nor were any further Australian industry manufacturers
identified by the Commission during the investigation.
No domestic producer of the goods
The relevant sections of the Act concerning the initiation of an investigation by Australian
industry are sections 269TB(4)(e) and 269TB(6).
Section 269TB(4)(e) provides that an application for a dumping and/or a countervailing

duty notice must be supported by a sufficient part of the Australian industry.
Section 269TB(6) provides that such an application is taken to be supported by a

sufficient part of the Australian industry:
…if the Commissioner is satisfied that persons (including the applicant) who
produce or manufacture like goods in Australia and who support the application:
33 EPR 550, Item 13.

34 EPR 550, Item 16.
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(a) account for more than 50% of the total production or manufacture of like goods
produced or manufactured by that portion of the Australian industry that has
expressed either support for, or opposition to, the application; and
(b) account for not less than 25% of the total production or manufacture of like
goods in Australia.
As detailed in CON 550, the Commissioner was satisfied that Orrcon represents the
entire Australian industry and accounts for more than 50% of the total Australian
production of like goods, thereby satisfying the requirements of sections 269TB(4)(e) and
269TB(6).
The Anti-Dumping Commission Dumping and Subsidy Manual (the Manual) sets out that:
There are no provisions in the Act to exclude from the definition of Australian
industry a producer/manufacturer that is related to an exporter, or that is itself an
importer of allegedly dumped or subsidised goods.35
The Commission has also reviewed imports of the goods, as reported in the ABF import
database for the investigation period, and did not identify any imports of the goods by
Orrcon or a related party of Orrcon during the investigation period.
In light of the above, the Commission is satisfied that the investigation has been properly
initiated in accordance with the Act and that Orrcon is the sole Australian
manufacturer/producer of the goods under consideration.
4.4.3 Insufficient members of the Australian industry in application
Hoa Phat Steel and Vina One submitted that neither the initiation notice, nor the
application, set out whether the dimensions are nominal or actual, although in later
correspondence, the Commission confirmed that the relevant measure of thickness is
taken to be nominal. That being the case, the submission proposed that other Australian
producers potentially exist which are selling the goods under consideration, in the form of
precision pipe and tube with rectangular and square sections, and with nominal thickness
less than 1.6mm.
The submission referred to investigations into similar types of imports from China, Korea,
Malaysia, Thailand and Taiwan and suggested, based on the findings of these
investigations, that Australian industry members making those other types of goods must
also be members of the Australian industry for precision pipe and tube steel.
On that basis, according to the submission, if Orrcon is not the sole member of the
Australian industry producing like goods, the validity of the Commission’s finding that the
application is supported by a sufficient part of the Australian industry is, arguably, in
35 The Manual, part 1.1.
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doubt. Section 269TB(6) sets out the requirements for standing to bring an application to
the Commission.36
Hoa Phat Steel and Vina One urged the Commission to make immediate contact with
other Australian manufacturers of similar products to confirm the status of their domestic
production of like goods and so as to ascertain whether the applicant is sufficiently
representative of the Australian industry to comply with s.269TB(4).
Hoa Phat Steel and Vina One further submitted that the thickness of the sections is
insufficient to define a separate and unique class of goods (or in the alternative, the
thickness of the sections is insufficient to confine the scope of the goods). Instead, all
locally produced sections complying with the same standard and grade, in this case
AS1163, are ‘like goods’ as they each possess the same essential physical, commercial,
functional and production characteristics. On that basis, the Australian industry producing
‘like goods’ includes all domestic producers manufacturing rectangular and square
structural sections that comply with Australian Standard AS1163.
Finally, Hoa Phat Steel and Vina One submitted that the application is defective and
should, therefore, be terminated.
As noted previously, no further Australian industry manufacturers of the goods identified

themselves to the Commission following the initiation of the investigation. Nor were any
further Australian industry manufacturers identified by the Commission during the
investigation. Austube Mills, an Australian company referred to in the submission as a
possible manufacturer of the goods, was verified by the Commission as an importer of the
goods.37
Contrary to the submission by Hoa Phat Steel and Vina One, the Commission considers
that thickness is sufficient to define separate classes of goods. There is no provision in
the Act that restricts the use of thickness in defining goods or that requires that all
products made to a certain standard are like goods. Recent examples of where a product
has been classed into different goods based on differing attributes are Investigation 540
and Investigation 541 which examined Aluminium extrusions with different finishes: i.e.
mill finish and surface finished, respectively.38
The Commission also notes that thickness is a defining characteristic in many tariff
classifications and that not all sections complying with the Australian standard are ‘like
goods’.
Finally, the Commission has considered the description of the goods as set out in
chapter 3 and considers that Orrcon is the sole manufacturer of the goods in Australia
and, therefore, that it meets the standing requirements set out in section 269TB(4).
36 Discussed in chapter 4.4.2.
37 EPR 550, Item 50.

38 Available on the Commission’s website.
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4.5 Production process

In its verification of the information submitted in Orrcon’s application39, the Commission
determined the production process for precision pipe and tube steel to be as follows:
 Master coil, in the form of HRC, cold-rolled coil or pre-galvanised HRC is the
primary raw material used in the production of precision pipe and tube steel;
 The master coil is un-wound into the slitter, where steel blades cut the coil into
predetermined widths;
 After slitting, the coils are re-wound on the re-coiler which ‘pulls’ the strip through
the blades. The slit coils are then strapped and moved to one of four mills for
rolling into steel tube;
 The tube forming process starts with the slit coil being placed on the un-coiler,
which feeds the coil into the mill. The strip runs through a series of forming rolls
that form the strip edges into a circular shape ready for welding;
 An induction welder heats the edges of the coil strip and the edges are ‘forged’
together;
 Excess material that is extruded along the weld seam on the external and internal
surfaces is removed, if applicable using a scarfing tools;
 Metallic thermal spray process is used to repair the weld zone on pre-galvanized
tube;
 The tubular product is then sized and formed into circular, rectangular, square and
other steel shapes;
 Once the tube forming process is complete, the tube is cut to size and de-burred
as required;
 The product goes through final quality checks, is formed into packs and restrained
with steel strapping.
Downgrade material which does not meet the required standards for sale and scrap lost
from Orrcon’s production process is collected through the process and sold separately.
4.6 Commissioner’s assessment

In respect of claims made Dalian Steelforce, Hoa Phat Steel and Vina One regarding
RHS with a nominal thickness of 1.6 mm and greater, the Commission confirms that such
products are outside the scope of this investigation, noting the thickness parameters for
RHS outlined in the goods description. Such products are not considered precision RHS,
and this distinction is consistent with the Commission’s treatment of RHS in
investigations, reviews and continuation inquiries relating to HSS exported from China,
Korea, Taiwan, Malaysia and Thailand.
The Commission considers the locally produced precision pipe and tube steel to be like to
the imported precision pipe and tube steel. This is based on:
 An examination of the manufacturing process for the goods and that part of the
process which is carried out in Australia;
39 Orrcon – Industry Verification Report, EPR 550, Item 56
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 An examination on whether known manufacturers of similar products also

manufacture like goods; and
 Responses from other Australian market participants similar to Orrcon, who
identified themselves as importers during the verification.
The Commissioner is satisfied that there is an Australian industry, consisting wholly of
Orrcon, producing like goods, and that the like goods are wholly or partly manufactured in
Australia.
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5 AUSTRALIAN MARKET
The Commissioner has found that the Australian market for precision pipe and tube steel
is supplied by the Australian industry and imports from a number of countries, including
the subject countries. Imports from each of the subject countries, as a percentage of the
total Australian import volume of the goods, were above negligible levels.
5.2 Background
The Australian market for the goods and like goods is supplied by Orrcon as the sole
member of the Australian industry, as well as manufacturers from other countries who
export to Australian customers directly or through intermediaries and distributors.
The analysis of the Australian market detailed in this chapter is based on verified
information submitted by Orrcon, import data from the ABF import database, and verified
importer and exporter information.
5.3 Market structure

The Australian market for precision pipe and tube comprises Orrcon as the sole local
manufacturer, exporters/importers, wholesalers, distributors, re-sellers, and end-users.
Precision pipe and tube steel is supplied to a range of market sectors including fencing,
furniture manufacturing, shelving and racking, heat exchangers, outdoor patio structures,
exhaust systems and other general mechanical or manufactured end-use applications.
Alternate after-market applications include “handy-man” and repair work.
5.3.1 Markets and distribution

Orrcon has two sales channels in the Australian market, with the majority of precision
pipe and tube sales made through its related distribution partners. The other sales
channel to market is referred to as “mill direct”, which is when a distributor or a customer
places an order directly with Orrcon for a limited range of goods. Mill direct orders have a
longer lead process time than sales made through its distribution partners.
Exporters were found to generally export their goods to Australian distributors, who then
on-sold the goods to end-users, although a limited number of direct sales to end-users
was observed.
5.3.2 Supply
Whether a customer can readily change supplier is dependent on the nature of the
customer and their business. Wholesalers, distributors and re-sellers can more readily
change suppliers, either through shifting to importers or between themselves. For end-
users, they can source supplies through Australian suppliers (who may source from
Orrcon or from imports) or directly from importers, but this is highly dependent on the end-
user being in a position to manage the cash flow and minimum volume order
requirements.
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Imported precision pipe and tube steel in the Australian market is sourced from numerous
countries, with the highest volumes over the investigation period coming from the subject
countries.
5.3.3 Demand
The demand for precision pipe and tube steel is driven by a diverse range of market
sectors in the Australian market.
Orrcon highlighted in its application that the increase in overall size of the Australian
market recently is attributed to growth in the pool fencing, general fencing (permanent
and temporary) and patio tube markets.
The Commission found that fencing has been the most significant market sector for the
goods consistently over the last four years, followed by automotive and furniture.
Although it is noted that automotive has been steadily decreasing and is likely to continue
to decline in light of the winding down of the automotive industry in Australia.
There are also seasonal factors which impact the demand for precision pipe and tube
steel, being the construction cycle which results in December and January effectively
aggregating to one month of normal sales, due to the traditional construction industry
holiday period falling at this time, and rural sector sales in May and June driven by
farmers resolving any outstanding repairs and maintenance issues prior to the end of
financial year.
The Commission found that, when grouped by industry group, construction made up the
majority of sales demand, following by manufacturing. The Commission then examined
construction work over the injury period to examine whether there is a correlation in
demand both seasonally and on a long term trend.
Using data from the Australian Bureau of Statistics, the Commission observed a strong
correlation between the value of building construction within Australia and the value of
sales of the goods by Australian industry.40 It is also noted that sales tended to fall in the
first quarter of each calendar year, before rising again over the remainder of the year,
mainly for sales in construction and less so for other sectors. The Commission is
therefore satisfied that movements in the construction industry have an effect on demand
in Australia for the goods.
5.4 Pricing
Orrcon has a price list framework in place for all manufactured precision pipe and tube
steel which is used as a basis to manage market offers. Orrcon receives feedback on
prevailing imported market rates, which is then used to adjust its prices on market offers
to customers.
40 Orrcon – Industry Verification Report, EPR 550, Item 56
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Product features and characteristics, as well as supply and commercial offer attributes will
influence the offer price to customers. The nature of the customer and the market
segment they operate in may also impact pricing.
Orrcon does not consider itself a price leader for the goods. Net prices are dictated by
customer orders and requirements, but are mainly priced to meet import competition via
import parity pricing, taking into consideration the market price of like goods using
contemporary price information for equivalent imported products.
Prices at a model level are also dictated by the steel feed coil cost and production costs.
In setting its prices, Orrcon seeks to recover its full cost to make and sell. However, full
cost recovery is not always realised.
Offers are negotiated with customers for a particular supply term, e.g. one month, three
months, six months etc. and are reviewed on a case by case basis either monthly,
quarterly or annually.
Pricing for exporters was found to generally be based on the cost to make (CTM) of the
goods, largely driven by raw material costs, plus a profit margin. Any specific customer
requirements will also affect the price, as will the volume of any orders.
5.5 Market size

5.5.1 Submission received in respect of market size
In CON 550, the Commission estimated the size of the Australian market for precision
pipe and tube steel by using data extracted from the ABF import database in respect of
consignments declared under the identified tariff classifications. This data was filtered to
exclude imports subject to existing measures, in particular HSS of different specified
dimensions which doesn’t comprise ‘like goods’. Data was separately extracted to
determine the volume of imports from countries already subject to measures. That data
was then compared to the volume of imports not subject to measures to determine the
ratio of HSS import volumes without measures. This ratio was then applied to the volume
of imports from countries where no measures on HSS are in place, including Vietnam.
In its submission dated 7 May 202041, Orrcon made the following comments:
 it agreed with the Commission’s market size approach with respect to non-circular
precision pipe and tube steel imports classified to tariff classification 7306.61.00
statistical code 21;
 the Commission’s proportional assessment for circular precision pipe and tube
steel is not required, and the total volume should be included in determining the
market size, as circular precision pipe and tube steel imports classified to tariff
classification 7306.30.00 statistical code 30 are not currently subject to anti-
dumping measures; and
41 EPR 550, Item 10.
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 reassessing the market size to include all imports of circular precision pipe and
tube steel will consequently impact the Commission’s volume-effect and price-
effect injury assessments.
5.5.2 Commission’s assessment – market size
The Commission agrees with Orrcon that, with respect to imported circular precision pipe
and tube steel classified to tariff classification 7306.30.00 statistical code 30, these goods
are not subject to anti-dumping measures and are, therefore, goods subject to this
investigation. All imports of circular precision pipe and tube steel are therefore included in
the total assessment of the Australian market size.
5.6 Commission’s assessment

In light of the above and information gathered during Australian industry and exporter
verification, the Commission has estimated the size of the Australian market for the goods
during the investigation period as follows:
 Verified sales data from Orrcon has been used to determine sales volumes by
Australian industry;
 Data extracted from the ABF import database in respect of consignments declared
under tariff classification 7306.30.00/30 and 7306.61.00/2142 has been used as a
starting point to determine import volumes. To exclude outlying data, which may
distort any findings, the Commission has then filtered the data to exclude
transactions where the Free on Board (FOB) price per tonne was outside a range
of AUD$500 to AUD$2,100. This is considered a reasonable price range to use as
a filter for the goods, based on the export price and normal values observed by the
Commission during the investigation;
 Imports from China, Korea, Malaysia, Taiwan and Thailand (HSS countries)
declared under tariff classification 7306.61.00/21 were filtered to exclude imports
subject to existing measures on HSS. This volume was included in the import total;
 The ratio of imports of HSS from the HSS countries compared to imports under
tariff classification 7306.61.00/21 from the HSS countries which were not HSS was
determined;
 This ratio was then applied to volumes of imports under tariff classification
7306.61.00/21 from all other countries not subject to HSS measures (including
Vietnam) to determine an estimate of the volume of imports under that tariff
classification which were the goods. This volume has been included in the import
total;
 Imports declared under 7306.30.00/30 are not currently subject to anti-dumping
measures and, accordingly, the whole volume reported in the ABF import database
has been included in the import total;
 The import total has then been adjusted to account for differences between the
import volumes reported in the ABF import database for each cooperating exporter
and the import volumes determined following exporter verification.
42 See chapter Error! Reference source not found. for further detail.
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Using the approach detailed above, the size of the Australian market is estimated as
depicted in the figure below.
Figure 1 – Australian market for the goods by country
The market for the investigation period was approximately 21,500 tonnes.
This estimate does not include air heater tubes, consistent with the Commission’s
assessment in section 3.4.2.
The Commission’s assessment of the size of the Australian market is at

Confidential Attachment 2.
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6 DUMPING INVESTIGATION
The Commission has found that the goods exported to Australia from China and Korea
were dumped.
Goods exported to Australia from Taiwan and Vietnam were found to not have been
dumped.
The Commission’s assessment of dumping margins is set out in the table below.
Country Exporter Dumping Margin (%)

Uncooperative exporters 2.9
Korea Uncooperative exporters 6.2
Taiwan Ta Fong - 9.0
Vietnam CDI - 12.2
Vina One - 12.0
Residual exporters - 6.5
Table 8 – Dumping Margins
6.2 Legislative and policy framework

In the report to the Minister under section 269TEA(1), the Commissioner must
recommend whether the Minister ought to be satisfied as to the grounds for publishing a
dumping duty notice under section 269TG.
Under section 269TG, one of the matters the Minister must be satisfied of, in order to
publish a dumping duty notice, is that the goods have been dumped.
Section 269TDA(1) requires that the Commissioner must terminate the investigation, in so
far as it relates to an exporter, if satisfied that there has been no dumping by the exporter,
or there has been dumping during the investigation period, but the dumping margin is less
than 2%.
Section 269TDA(3) requires that the Commissioner must terminate the investigation, in so
far as it relates to a country, if satisfied that the total volume of goods that have been, or
may be, dumped is a negligible volume.
Dumping occurs when a product from one country is exported to another country at a
price less than its normal value. The export price and normal value of goods are
determined under sections 269TAB and 269TAC, respectively.
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6.2.1 Dumping margin
For all dumping margins calculated for the purposes of this investigation, the Commission
compared export prices over the whole of the investigation period with the corresponding
normal values.
6.2.2 Export price
Export price is determined in accordance with section 269TAB, taking into account
whether the purchase or sale of goods are ‘arms length’ transactions under section
269TAA.
Section 269TAB(1)(a) provides that the export price of any goods exported to Australia is
the price paid (or payable) for the goods by the importer where the goods have been
exported to Australia otherwise than by the importer, and have been purchased by the
importer from the exporter in ‘arms length’ transactions.
Section 269TAB(1)(b) provides that where goods have been exported to Australia
otherwise than by the importer and have been purchased by the importer from the
exporter, but not at ‘arms length’, and the goods are then subsequently sold in the
condition they were imported to a party not associated with the importer, the export price
of goods is the price that the importer sold the goods, less prescribed deductions.
Section 269TAB(1)(c) provides that in all other cases, the export price is a price
determined by the Minister having regard to all the circumstances of the exportation.
6.2.3 Normal value
Goods sold in the ordinary course of trade
Section 269TAC(1) provides that the normal value of any goods exported to Australia is
the price paid (or payable) for like goods sold in the ordinary course of trade (OCOT) for
home consumption in the country of export in sales that are ‘arms length’ transactions by
the exporter, or, if like goods are not so sold by the exporter, by other sellers of like
goods.
Low volume of domestic sales
Section 269TAC(2)(a)(i) provides that the normal value of goods exported to Australia
cannot be ascertained under section 269TAC(1) where there is an absence, or low
volume, of sales of like goods in the market of the country of export that would be relevant
for the purpose of determining a price under section 269TAC(1). Relevant sales are sales
of like goods sold for home consumption that are ‘arms length’ transactions and sold in
the OCOT.
Domestic sales of like goods are taken to be in a low volume where the total volume of
like goods is less than 5% of the total volume of the goods under consideration that are
exported to Australia (unless the Minister is satisfied that the volume is still large enough
to permit a proper comparison). As per the Manual, where the total volume of relevant
sales is 5% or greater than the total volume of the goods under consideration, and where
comparable models exist, the Commission also considers the volume of relevant
domestic sales of like goods for each model (or MCC).
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Particular market situation
Section 269TAC(2)(a)(ii) provides that the normal value of goods exported to Australia
cannot be ascertained under section 269TAC(1) where the situation in the market of the
country of export is such that sales in that market are not suitable for use in determining a
price under section 269TAC(1).
Particular market situation is discussed further in section 6.3.
6.3 Particular market situation

6.3.1 Introduction
The application alleged the presence of a particular market situation in the Chinese and
Vietnamese domestic markets for the goods.
Section 269TAC(2)(a)(ii) implements, in part, Article 2.2 of the ADA:
When there are no sales of the like product in the ordinary course of trade in the domestic
market of the exporting country or when, because of the particular market situation or the low
volume of the sales in the domestic market of the exporting country [footnote omitted], such
sales do not permit a proper comparison, the margin of dumping shall be determined by
comparison with a comparable price of the like product when exported to an appropriate third
country, provided that this price is representative, or with the cost of production in the country
of origin plus a reasonable amount for administrative, selling and general costs and for profits.
Where a particular market situation is found, pursuant to section 269TAC(2)(a)(ii), the

Commission must further consider whether, because of the situation in the subject
market, sales in that market are also not suitable for determining a price under section
269TAC(1).
If a market situation exists in a country, such that domestic sales are not suitable for
comparison with export sales, normal values may instead be constructed under section
269TAC(2)(c) or determined by reference to prices from a third country under section
269TAC(2)(d).
The Act does not prescribe what is required to reach a finding of a market situation. A
market situation will arise when there is some factor (or factors) impacting the relevant
market in the country of export generally. When considering whether sales are not
suitable for use in determining a normal value under section 269TAC(1), because of the
situation in the market of the country of export, the Commission may have regard to
factors such as:
 whether the prices are artificially low; or

 whether there are other conditions in the market that render sales in that market
not suitable for use in determining prices under section 269TAC(1).
Government influence on prices or input costs could be one cause of artificially low
prices. Such government influence could come from any level of government.
In assessing whether a market situation exists due to government influence, the

Commission will assess whether government involvement in the domestic market has
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materially distorted market conditions. If market conditions have been materially distorted,
then domestic prices may be artificially low or not substantially the same as they would be
in a competitive market.
Prices for the like goods may also be artificially low or not substantially the same as they
would otherwise be, due to government influence on the costs of inputs. The Commission
assesses the effect of any such influence on market conditions and the extent to which
domestic prices can no longer be said to prevail in a normal competitive market.
The Manual provides further guidance on the circumstances in which the Commission will
find that a market situation exists.43
6.3.2 Information relied upon to undertake the Commission’s assessment
In undertaking its assessment of whether a market situation exists in either China or

Vietnam, the Commission has considered the following:
 the information provided in the application;

 response to the government questionnaire by the GOV;
 REQs by cooperating exporters;
 previous market situation assessments undertaken by the Commission;44 and
 desktop research, including information obtained from departmental resources and
third party information providers.
6.3.3 The Commission’s approach
In accordance with its legislative requirements, the Commission’s market situation

assessment is undertaken at the level of the goods and like goods.
The Commission has given consideration to conditions:
 within the broader steel industry in each country and the degree to which these
may impact on prices and/or raw material costs;
 in the Chinese and Vietnamese market for the raw materials used to produce the
goods; and
 in the Chinese and Vietnamese markets for the goods.
6.3.4 Significance of HRC costs in the production of the goods
The Commission has found that steel coil is the major raw material input used in the
production of the goods, either as HRC, cold rolled coil (CRC) or pre-galvanised coil.
43 The Manual, p. 36.

44 A number of past cases have made market situation findings concerning steel products in China, with the
following cases particularly relevant as the products examined have HRC as the chief raw material input:
REP 177 (HSS - 2012), REP 379 (HSS - 2017), REP 456 and 457 (coated steels - 2018), REP 419 (HSS -
2018) and SEF 553 (Painted Steel Strapping – 2021).
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Both CRC and pre-galvanised coil are made from HRC which has undergone further
processing, either in the form of:
 rolling at low temperatures, generally to alter its thickness, provide a smoother

surface and increase yield strength and hardness (cold rolling); or
 galvanising in a thin layer of zinc to prevent corrosion (among other things).
The Commission considers that CRC and pre-galvanised coil costs, while generally
higher than HRC due to the additional processing, are closely related to the costs of HRC
and are impacted to the same extent as HRC by any influence on the HRC market.
The Commission has verified the HRC associated with the production of the goods during
the investigation period for all producers. The Commission found that coil costs
represented a significant and broadly consistent proportion of the CTM of the goods. This
is depicted in the table below.
Producer Country Percentage of total CTM Percentage of raw material

made up by steel coil costs costs made up by steel coil
Orrcon Australia 64% 92%
Dalian China 88% 99%
CDI Vietnam 87% 95%
Vina One Vietnam 91% 99%
Ta Fong Taiwan 91% 100%45
Table 9 – Raw material coil as a proportion of CTM of the goods46
The percentage of CTM made up by raw material costs for Orrcon is lower than that for
Chinese, Taiwanese and Vietnamese producers, primarily due to higher manufacturing
overheads, which accounts for 30% of the total cost in Australia.
Cooperating exporters advised the Commission that raw material prices are influential in
setting selling prices for the goods, with lower raw material prices resulting in lower prices
for the goods.
Given the high cost proportion of steel coil in the production of the goods and its influence
on pricing decisions, the Commission considers that the HRC price (and through it, the
price of CRC and pre-galvanised coil) has a significant impact on both the production cost
and selling price of the goods.
6.3.5 China
In its application, Orrcon claimed that, due to the influence of the GOC in the Chinese iron
and steel industry there is a particular market situation in the Chinese domestic market for
precision pipe and tube steel that renders sales in that market unsuitable for determining
normal values under section 269TAC(1).
45 HRC here includes HRC that has been further treated, for example cold rolled steel, pickled and oiled steel.
46 Confidential Attachment 3 – CTM breakdown.
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In making its claim, Orrcon has referred to previous findings by the Commission relating
to GOC influence in steel markets and the impact on HRC prices, the key raw material
used in the manufacture of precision pipe and tube steel.47
Upon initiation, the Commission sent a questionnaire to the GOC requesting information
in relation to the precision pipe and tube steel market in China. A copy of this
questionnaire is available at Non-confidential Attachment 4.
The GOC did not provide a response to this questionnaire.
A further Orrcon submission was received on 18 August 2020.48 In it, Orrcon provided
further information in support of its claim of a market situation in China, including:
 research detailing the levels of state control, subsidisation in the Chinese steel
industry, including underreporting of subsidisation by the GOC;
 analysis of raw material prices in China, compared to other Asian countries,
showing a “systematic and material difference” between Chinese prices and those
of other countries;
 comments on WTO report WTO Panel Report Australia – Anti-Dumping Measures
on A4 Copy Paper (DS 529)49 regarding the Commission’s findings in respect of
A4 copy paper and the requirements around proper comparison in a market
situation;
 claims that the market situation in China means it is not suitable to compare the
prices of the goods that are exported with those sold on the domestic market, as
domestic prices are materially and artificially lower than export prices.
In assessing whether a market situation exists in relation to the Chinese precision pipe
and tube steel market in the investigation period, the Commission has relied on and
considered all the evidence available to it, including REQs, Orrcon’s submission
discussed above, findings of previous cases conducted by the Commission and desktop
research. This includes:
 the level of import competition in the Chinese domestic market as a result of GOC
involvement and influence over the broader steel industry, as well as the HRC and
precision pipe and steel tube markets;
 various subsidy programs, lending and credit facilities, preferential loans, land
grants and capacity controls affecting domestic output and consumption of steel;
 capacity management measures on bank lending to mills, industry consolidation
and use of environmental requirements;
 Chinese steel industry response to GOC directives such as the 13th Five-Year Plan
for National Economic and Social Development and the Iron and Steel Industry
Adjustment and Upgrade Plan;
47 See, for example, findings set out in Anti-Dumping Commission Report No. 441 (steel pallet racking),
Anti-Dumping Commission Report Nos. 456 and 457 (aluminium zinc and zinc coated steels) and
Anti-Dumping Commission Report No. 379 (HSS).
48 EPR 550, Item 39.
49 WTO DS529, available at https://www.wto.org/english/tratop_e/dispu_e/cases_e/ds529_e.htm
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 implementation of GOC objectives through the National Development and Reform

Commission, through its dual role of developing planning guidelines and directives
and approving large scale investment projects;
 the share of total Chinese steel production by State-owned Enterprises (SOEs);
and
 export taxes and export quotas on a number of key inputs in the steel making
process, including coking coal, coke, iron ore and scrap steel.
In light of all the information before the Commission, it is the Commission’s view that a
particular market situation existed in respect of the domestic market for precision pipe and
tube steel in China for the investigation period.
A complete examination of the evidence for this finding is set out in Non-confidential
Appendix A.
6.3.6 Vietnam
Orrcon also claimed in its application that, due to intervention of the GOV in the iron and
steel industry raw material supply market, the prices of precision pipe and tube steel have
been distorted, resulting in a particular market situation in the Vietnamese domestic
market for precision pipe and tube steel that renders sales in that market unsuitable for
determining normal values under section 269TAC(1).
Orrcon has claimed the GOV has intervened in the domestic steel industry through:
 electricity prices;
 Steel Master Plans;
 Industrial Development Strategy;
 State ownership of precision tube manufacturers;
 domestic price stabilisation initiatives;
 steel industry construction project and investment control; and
 steel industry subsidisation.
Orrcon made a submission on 9 April 2020 in respect of the Vietnamese Steel Master
Plans, which discussed the impact of the plans on capacity, growth, production,
investment decisions and regional distribution beyond their revocation at the end of
2018.50
A further Orrcon submission was received on 18 August 2020.51 In it, Orrcon submitted
that:
 Orrcon was unable to source domestic selling price information for the goods sold
in Vietnam, and would expect the Commission to have similar difficulties;
 a recent Canada Border Services Agency (CBSA) investigation found HRC prices
in Vietnam are 18% to 19% lower than average world prices. Orrcon submitted that
50 EPR 550, Item 6.

51 EPR 550, Item 39.
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this difference in raw material costs is indicative of lower than competitive market
price for the subject goods in Vietnam;
 Orrcon has compiled data on domestic HRC prices in Vietnam, against those
prices in China, South Korea, Japan and Taiwan. This data, if viewed in the
context of a market situation in Vietnam, is evidence of lower input costs for the
manufacture of the goods;
 a market situation in Vietnam means it is not suitable to compare the prices of the
goods that are exported with those sold on the domestic market, as domestic
prices are materially and artificially lower than export prices.
The GOV made a submission to the Commission on 21 January 2020 in respect of

another application for similar goods (that application was subsequently withdrawn). At
the request of the GOV, the submission has been considered by the Commission in this
investigation.52 In the submission, the GOV expressed a view that a particular market
situation does not exist in the Vietnam market for precision pipe and tube steel. The GOV
has indicated to the Commission that there have been changes to Steel Master Plans and
the Industrial Development Strategy which means they no longer apply to the steel
industry. The GOV referred to previous findings of the Commission concerning zinc
coated (galvanised) steel in Vietnam, which found that a particular market situation did
not exist for that product.
The GOV was also sent a questionnaire requesting further information in relation to the
precision pipe and tube steel market in Vietnam. The GOV response to the questionnaire
was provided to the Commission on 7 June 2020.53
A further submission was made by the GOV to the Commission regarding the claim of a
particular market situation on 7 August 2020.54
A submission made by RCR International Pty Ltd (RCR) published on 12 May 202055
supports the GOV submission in relation to any finding that a particular market situation
for precision pipe and tube steel may exist in Vietnam. RCR also noted that evidence
used by Orrcon in its application does not accurately reflect the current situation in the
Vietnamese market, as well as referring to previous investigations where the Commission
found no particular market situation in Vietnam.
In assessing whether a market situation exists in relation to the Vietnamese precision

pipe and tube steel market in the investigation period, the Commission has relied on all
the evidence available to it, including questionnaires and the submissions made in this
investigation along with desktop research. This includes:
 previous investigations by the Commission which did not find there to be a

particular market situation in respect of the relevant goods;
52 EPR 550, Item 4.

53 EPR 550, Item 36.
54 EPR 550, Item 38.
55 RPR 550, Item 11.
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 the expiry of the Steel Master Plans in late 2018 with no apparent evidence of any
ongoing influence in respect of those plans;
 the expiry of legislation implementing price stabilisation measures in 2014;
 the right of enterprises to determine their own prices at which goods and services
which they manufacture are sold;
 the lack of evidence of a significant role for Vietnamese State-owned Enterprises in
the steel, HRC or precision pipe and tube steel market;
 the minimal levels of subsidisation found in respect of upstream raw materials or
the goods themselves;
 the level of import penetration in the domestic steel Vietnamese market; and
 evidence that raw material costs purchased by Vietnamese exporters from
Vietnamese suppliers are consistent with raw material costs purchased from other
countries, excluding China.
In light of all the information before the Commission, it is the Commission’s view that a
particular market situation did not exist in respect of the domestic market for precision
pipe and tube steel in Vietnam for the investigation period.
A complete examination of the evidence for this finding is set out in Non-confidential
Appendix B.
6.4 Proper comparison of domestic and export prices

6.4.1 Introduction
Where a particular market situation is found, pursuant to section 269TAC(2)(a)(ii), the

Commission must also consider whether, because of the situation in the market of the
country of export, sales of like goods in that market are not suitable for determining a
price under section 269TAC(1).
As a particular market situation has been found in respect of the domestic market for the
goods in China for the investigation period, the Commission will examine whether goods
in that market are suitable for determining a price under section 269TAC(1).
No such examination is required for goods in the domestic market in Vietnam, as the
Commission considers that a particular market situation did not exist in respect of the
precision pipe and tube steel market in Vietnam for the investigation period.
6.4.2 Approach to proper comparison
In order to assess whether sales are suitable for the purposes of section 269TAC(1), the
Commission’s approach to assessing proper comparison considers the relative effect of
the market situation on both domestic sales and Australian export sales. If there is a
finding that domestic sales and export sales are not equally impacted by the market
situation, such a finding may render domestic sales not suitable for the purposes of
section 269TAC(1).
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The Commission considers this approach consistent with Australia’s obligations under the
ADA56 and the WTO Panel’s interpretation of these obligations set out in DS 529.57
When assessing the relative effect of the particular market situation on domestic and
export prices, the Commission has compared the existing relationships between price and
cost in the domestic and export markets of the exporting country. These relationships will
be defined by the prevailing conditions of competition in each market. This has involved
an examination of:
 the relationship between raw material costs and the domestic and Australian
export prices for the goods for each relevant producer of the goods;
 the domestic market conditions (the particular market situation) leading to those
costs and prices; and
 export market conditions.
The Commission considers that the relationship between cost, price and competition will
provide insight into the effect of the market situation in the country of export (domestic
prices) and Australian markets (export prices). In turn, it will provide insight into whether a
proper comparison is permitted between domestic prices and Australian export prices.
In particular, the Commission has undertaken:
1. a quantitative assessment of prices, noting that “…a purely numerical comparison

between the two prices may not reveal anything about whether the domestic price
can be properly compared with the export price”;58 and
2. a qualitative assessment of prices, to “…focus on how the particular market
situation affects that comparison.”59
This approach assesses both the effect of the particular market situation on domestic and
export prices. This is because while “…a particular market situation may have an effect
on both domestic and export prices, it does not follow that the impact on domestic and
export prices will be the same.”60
6.4.3 Examination of Australian conditions of competition
Market structure
The Australian market for precision pipe and tube steel has been discussed in detail in
chapter 5.3 of this report. In summary:
 The Australian market for the goods is supplied by Orrcon as the sole member of
the Australian industry, imports from the subject and non-subject countries, with
goods generally sold to customers through Australian based distributors;
56 https://www.wto.org/english/docs_e/legal_e/19-adp_01_e.htm
57 https://www.wto.org/english/tratop_e/dispu_e/cases_e/ds529_e.htm
58 DS 529 – para. 7.75.
59 DS 529 – para. 7.75.
60 DS 529 – para. 7.76.
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 Australian industry supplies the greatest volume in Australia, followed by imports

from China, Taiwan and Vietnam;
 Customers can readily change between suppliers, either through shifting to
importers or between Australian suppliers (who may source themselves from
Orrcon or from imports);
 Demand for the goods is driven by a diverse range of market sectors in the
Australian market, including fencing, automotive and furniture.
The Commission considers the Australian market for the goods is a competitive market,
characterised by a large number of suppliers and customers engaging in commercial
negotiations in the sale and purchase of the goods.
Raw material
The major raw material used in the production of the goods in Australia is HRC,
purchased from Australian suppliers.
From its previous investigations into HRC, the Commission understands that price is
generally the main factor which influences an Australian customer’s purchase decision for
HRC. Australian producers of HRC set their price based on an import benchmark pricing
strategy where known import offers in the Australian market are used to determine the
level at which Orrcon sets its selling price.61
Australian produced HRC competes with imported goods mostly at the wholesale or
distribution level of trade. These customers then on-sell the HRC to end users or other
resellers, predominantly in the general manufacturing and pipe and tube industry.62
Import penetration
The Commission examined the ABF import database to identify exporters and importers
of precision pipe and tube steel during the investigation period. The Commission
observed that during the investigation period:63
 the goods were exported to Australia from at least 10 countries by over 60 unique
exporters, with approximately 20 exporters from both China and Vietnam, one
exporter from Korea and 4 exporters from Taiwan;
 over 60 unique importers were identified as having imported the goods;
 imports accounted for 37% of sales in the Australian market; and
 of these imports, Chinese imports accounted for 32% of sales, Taiwanese imports
24%, Vietnamese imports 20% and Korean imports 6%.
The presence of a number of importers with material import volumes from numerous
countries indicates to the Commission that the Australian market for the goods can be
61 REP 400, chapter 4.3.2.

62 REP 400, chapter 4.3.
63 Confidential Attachment 2 – Australian Market Analysis. Only exporters with more than 5MT of export
volume during the investigation period have been included in this analysis.
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characterised as having a high level of import penetration contributing to a competitive

market for the goods between participants.
6.4.4 Examination of Chinese conditions of competition
Market structure
As discussed in chapter 6.3.5, the Commission sent a questionnaire to the GOC

requesting information in relation to the precision pipe and tube steel market in China.
The GOC did not provide a response to this questionnaire.
Dalian Steelforce advised in its REQ that it was not in a position to provide a response to
questions on the Chinese market for the goods as it does not sell the goods on its
domestic market.
In its submission, dated 18 August 2020, Orrcon noted the following in respect of the
effect of the particular market situation for the goods in the Chinese domestic market:
 “…[T]he provision of HRC at less than adequate remuneration will result in lower
subject goods prices on the domestic market, although potentially higher margins
on the export market. Further, the recent (March 2020) change to the VAT export
rebate will direct domestic sales to the export market, creating significant export
competition and suppressed selling prices (including for the subject goods). While
both markets are affected in these instances, the impact would manifest
differently.”64;
 “The Chinese PMS has rendered the subject goods domestic price and export
price unsuitable for comparison. This is evident via an assessment of officially
traded Asian-regional index prices in which China has significant influence and
weighting compared to China’s own in-country pricing.”65;
 “It is widely considered that prices are materially lower on the export market for
steel products, on the premise that steel manufacturers seek to service profitable
domestic markets first, and export surplus production (usually covering only
variable costs). In the case of China, a clear role-reversal is depicted above, and is
driven by the PMS.”66;
 “Orrcon submits that Chinese producers of Precision pipe & tube have access to
cheaper hot-rolled coil inputs due to distortions in the Chinese steel market. In
Review inquiry No. 456, the Commission found that Chinese domestic HRC
purchase prices were, on average, 14 per cent lower than HRC domestic purchase
prices in Korea and Taiwan, and consequently that “…the GOC materially
influenced conditions within the Chinese HRC markets during the review period
and because of that influence, the domestic price for Chinese aluminium zinc
coated steel and galvanised steel was substantially different to those in competitive
market conditions.”
64 EPR 550, Item 36, p.9.

65 Ibid, p.10.
66 Ibid, p.12.
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Precision pipe & tube is a further value-add steel product not unlike the subject
goods of Review inquiry No. 456. The impact of the GOC’s material influence on
market conditions can also be similarly assessed.
On a price-comparison basis, when Chinese Precision pipe & tube export prices
are contrasted with selling prices in a competitive market (such as Australia, where
pricing is determined on an import parity basis), they are clearly lower (due to GOC
influence) and undercut all other participants.”67.
Raw material
In a recent investigation, Investigation 553 – Painted Steel Strapping, the GOC provided a
RGQ in which it commented on the Chinese domestic market for HRC.68 Due to the
similarities in the particular market situation allegations and the raw material inputs in the
two cases, the Commission has had regard to the response by the GOC to Investigation
553 in its consideration of this investigation, pursuant to section 269TDAA(2)(b).
The GOC submitted prices for HRC are unregulated. Prices are set in the market through
commercial transactions between buyers and sellers and result in competitive prices.
While the Commission has found a particular market situation in respect of the Chinese
market for the goods, as set out in chapter 6.3.5, the Commission is satisfied, based on
the findings of Investigation 553, that there is a large volume of participants who engage
in commercial negotiations in the sale and purchase of HRC, which is indicative of
competition, albeit impacted by government distortions.
As the cooperative Chinese exporter primarily used CRC and pre-galvanised coil, the
Commission examined the monthly CRC and pre-galvanised coil price paid by the
cooperative Chinese exporter with the monthly CRC and pre-galvanised coil MEPS69
prices for China, Korea and Taiwan.70
67 Ibid, p.14.
68 EPR 553, Item 10.
69 MEPS is an international independent supplier of steel market data and information. The Commission has
a subscription service with MEPS for the provision of such data.
70 MEPS prices for HRC and CRC are reported EXW for China and EXW delivered for Japan, Korea and
Taiwan. Where direct comparisons have been made, adjustments have been made for delivery costs.
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Figure 2 – CRC monthly purchase prices71
Figure 3 – Pre-galvanised coil monthly purchase prices72
From the figures above, the Commission has observed:
 there are only minor differences between the two coil MEPS prices in Korea
compared to the MEPS prices in Taiwan (in other words, Korean and Taiwanese
prices are largely the same);
 Chinese prices (both of the Chinese cooperating exporter and according to MEPS
data) are lower at all times that the Korean and Taiwan MEPS prices; and
 prices paid by the cooperating Chinese exporter for CRC are generally lower than
the Chinese MEPS price, but higher for pre-galvanised coil.
The Commission also compared the monthly HRC MEPS prices for China, Korea and
Taiwan, along with the verified HRC purchase prices for the cooperating Chinese and
Taiwanese exporters and Australian industry.
71 Confidential attachment 4 – Raw material cost analysis and benchmark calculation.

72 Ibid.
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Figure 4 – HRC monthly purchase prices73
The figure above shows that Chinese HRC costs (both in MEPS and from Dalian
Steelforce) are the lowest over the investigation period, and well below that of Australian
industry.
From the information above, the Commission is satisfied that Chinese manufacturers
have access to cheaper raw material inputs. The Commission considers the Chinese
domestic market conditions lead to lower prices for steel coil due to the distortions in the
Chinese market, as discussed in Non-confidential Appendix A.
The Commission’s raw material input analysis is at Confidential Attachment 4.
Import penetration
The Commission examined the ABF import database and noted there were more Chinese
exporters of the goods to Australia during the investigation period than from any other
country. Given the relative size of Australia’s customer base compared to China’s, the
Commission considers the number of Chinese manufacturers supplying the Australian
market would represent only a small portion of all Chinese manufacturers. The
Commission also noted from the information provided by the cooperating exporter that
they maintain excess production capacity.
The Commission considers that, due to the number of Chinese producers supplying the
Chinese market, and based on the low cost of raw material inputs available to those
producers, which is lower than comparable international benchmarks, there would appear
to be a competitive disadvantage in respect of the importation of the goods into China.
73 Ibid.
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Evidence provided in the May 2020 US International Trade Administration Global Steel
Trade Monitor Report also indicates import penetration (as a function of consumption) in
steel (which would include the goods) has remained low, at 1.6% in 2018 and 2019.74
Accordingly, based on the information before the Commission, albeit limited, on balance it
appears that import penetration in the Chinese market for the goods was low in the
investigation period, relative to the Australian market.
6.4.5 Relationship between price and cost
China
The Commission considers that in the Chinese domestic market, Chinese producers of
the goods operate under market conditions which differ from those of exporters in other
countries, including that of the Australian industry. Specifically, the market situation in
China reduces costs across all production of the goods and like goods, due to lower raw
material costs.
Dalian Steelforce is an export-oriented producer that does not manufacture goods for the
domestic Chinese market. Due to a lack of information, the Commission was unable to
compare the CTM of goods produced for sale on the domestic market by Chinese
manufacturers against the CTM of goods produced for export to the Australian market.
Information provided by verified exporters from other countries in this investigation

indicates there is no difference in the production process between domestically sold and
exported goods. On the evidence before it, the Commission has assumed that Chinese
manufacturers would also have no difference in their production process for domestically
sold and exported goods.
The Commission was also unable to compare domestic selling prices for the goods
across different Chinese manufacturers due to a lack of cooperating responses.
Nonetheless, from the evidence before it in relation to the HRC market and the likely
number of Chinese manufacturers supplying the domestic market, the Commission is
satisfied the Chinese domestic market for the goods is highly competitive. As a result of
this competitive environment for the goods, the lower raw material costs flowing from the
presence of a particular market situation directly affects precision pipe and tube steel
prices, such that the prices are lower than they would otherwise have been.
This relationship defines the conditions of competition in China. The effect of the market
situation on the domestic sales prices in China does not result in any competitive
advantages or disadvantages between domestic producers selling in the domestic
market, as it modifies the conditions of competition in a consistent manner for all market
participants.
As a consequence, the Commission considers that Chinese producers have little flexibility
with respect to price-setting for sales of the goods in their domestic market.
74United States International Trade Administration, Global Steel Trade Monitor, Steel Imports Report: China,
May 2020.
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Due to the lack of data provided by Chinese manufacturers on Australian export prices,
the Commission has relied upon import prices available from the ABF import database to
undertake its analysis of the relationship between raw material costs and export prices.75
The figure below depicts the range of Australian import prices from all Chinese exporters
of the goods during the investigation period.
Figure 5 – Anonymised Chinese import prices of the goods into Australia, weighted average unit
price over the investigation period76
The figure indicates a variability in pricing by Chinese manufacturers in the Australian

market.
The Commission has also compared the selling price of the goods imported from China
with the selling price of goods imported from Korea and Taiwan, along with Australian
industry selling prices, using verified importer and Australian industry data. The
Commission did not have enough verified price data at the same level of trade to
compare Vietnamese imports with Australian industry.
75 See chapter Error! Reference source not found. for the Commission treatment of ABF import data.
76 Confidential attachment 2 – Australian market analysis.
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Figure 6 – Price undercutting analysis based on comparison of verified importer selling prices77
The Commission observes that the selling prices for goods imported from China undercut
Taiwanese and Australian selling prices in every quarter of the investigation period. Lower
selling prices are observed for goods imported from Korea, which is discussed further in
chapter 9.7.1.
Based on the above analysis, the Commission considers that:
 there is a market which is internally competitive between domestic participants in

China where no competitive advantage is derived by any individual manufacturer
as the reduced production costs resulting from the situation in the market benefits
all producers; and
 the Australian market is a competitive market. The Commission considers
variability of pricing between Chinese manufacturers in the Australian market is
indicative of a competitive advantage enjoyed by Chinese exporters due to the
market situation, which allows them to engage in pricing strategies in the
Australian market that allow them to achieve either:
o higher margins than the margins attainable on the sale of the same goods
on the domestic market; or
o increased sales volumes by significantly undercutting other participants in
the Australian market; or
o a combination of higher margins and increased sales volumes resulting from
undercutting.
6.4.6 Conclusion on the effects of the situation in the market
The Commission’s analysis indicates that the relationship between price and cost and the
prevailing conditions of competition in China are different in comparison to the
relationship between price and cost and the prevailing conditions of competition in
Australia. Specifically, the effect of the market situation in China is a decrease in input
costs across all production that results in a lower level of competitive pricing throughout
77 Confidential Attachment 5 – Australian industry and import sales analysis.
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the market in China. This relationship defines the conditions of competition in China.
Based on the information before the Commission, on balance, the effect of the market
situation on the domestic sales prices in China does not result in any competitive
advantages or disadvantages between market players, being Chinese producers. In other
words, the particular market situation modifies the conditions of competition in a
consistent manner for the major market participants.
In Australia, where no market situation or input cost decrease exists, competitive pricing
prevails at a higher level. Higher production costs for those participants producing without
the benefit of a market situation establishes a higher minimum threshold for competitive
prices. Under these circumstances, the effect of the market situation in China on the price
of the goods sold into the Australian market results in competitive advantages and
disadvantages between market players.
Specifically, Chinese exporters enjoy a cost advantage that either manifests as an

increased margin at the prevailing level of competitive pricing in the Australian market, a
low export price that undercuts the prevailing level of competitive pricing, or a
combination whereby the Chinese manufacturer can enjoy a higher margin while still
undercutting other market participants. In other words, the effect of the market situation
on export price is to modify the conditions of competition in Australia to the benefit of
Chinese exporters and, to the extent that benefit manifests as a low price that undercuts
the prevailing level of competitive pricing in Australia, to the detriment of all other market
participants in that market.
Thus, the relative effect of the market situation on domestic and export prices is different
in the relevant markets.
In the present investigation, the Commission considers that the evidence discussed in this
chapter indicates that sales in the domestic Chinese market are not suitable for
determining a normal value pursuant to section 269TAC(1) because they do not permit a
proper comparison with the export price of the goods exported to Australia.
6.5 Constructed normal values – China

6.5.1 Applicable legislation, policy and practice
Where the Minister is satisfied that normal value cannot be determined under section
269TAC(1), as is the case in this investigation for China, section 269TAC(2)(c) provides
that the normal value is:
… the sum of:
(i) such amount as the [Minister] determines to be the cost of production or

manufacture of the goods in the country of export; and
(ii) on the assumption that the goods, instead of being exported, had been sold
for home consumption in the ordinary course of trade in the country of
export—such amounts as the [Minister] determines would be the
administrative, selling and general costs associated with the sale and the
profit on that sale
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As required by sections 269TAC(5A) and 269TAC(5B), the construction of normal values

under section 269TAC(2)(c) must be in accordance with the Customs (International
Obligations) Regulation 2015 (the Regulations).
To determine costs of manufacture or production in relation to constructing normal values,

section 43(2) of the Regulations requires that the Minister must work out the cost of
production or manufacture using the information set out in the exporter or producer’s
records if:
 an exporter or producer of the goods keeps records relating to the goods that are
in accordance with generally accepted accounting principles (GAAP) in the country
of export; and
 those records reasonably reflect competitive market costs associated with the
production or manufacture of the goods.
It is the Commission’s view that, where an exporter’s records are otherwise in accordance
with GAAP, and are reliable, but the records do not reasonably reflect competitive market
costs associated with the production or manufacture of the goods, it is open for the
Minister, if practicable, to adjust the records so they reasonably reflect competitive market
costs associated with the production or manufacture of the goods in the country of export.
In making such adjustments, the Commission considers that the Minister may have
regard to all relevant information.
6.5.2 Establishing normal values for selected exporters
The Commission notes that, in accordance with section 269TAC(3A), the Minister is not
required to consider working out the normal value of goods under section 269TAC(2)(d)
before working out the normal value of goods under section 269TAC(2)(c). Where section
269TAC(1) is not available, the Commission’s policy preference, as outlined at chapter 10
of the Manual, is to construct normal values under section 269TAC(2)(c), in the first
instance, when the cost data of exporters is available.
When considering whether it is preferable to use the price paid or payable for like goods
sold by the exporters to a third country, pursuant to section 269TAC(2)(d), the
Commission must be satisfied that it is an ‘appropriate third country’. The Commission
has regard to the following factors, to determine whether any such third country is
‘appropriate’: 78
 whether the volume of trade from the country of export to the selected third
country is similar to the volume of trade from the country of export to Australia,
and
 the nature of the trade in like goods between the country of export and the
selected third country is similar to the nature of trade between the country of
export and Australia (when considering ‘nature of trade,’ such things as the level
of trade in a third country may be relevant).
78 The Manual, page 51.
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In this case, the Commission considers that the information provided by the exporters in
their REQs does not provide a precise or granular level of detail to determine whether a
third country would be appropriate and to undertake the calculations required to
determine a normal value.
Consequently, the Commission has constructed normal values under section

269TAC(2)(c), and has done so in accordance with sections 43, 44 and 45 of the
Regulations, relevant aspects of which are outlined below.
6.5.3 Raw material cost adjustment – China
The Commission has considered all relevant information, including raw material
purchases by the cooperative Chinese exporter, and considers it appropriate to use the
exporter’s records, which are in accordance with GAAP, but only after an adjustment is
made to the records relating to the raw material costs. Such an adjustment ensures that
the exporter’s records reflect “competitive market costs”, that is, the cost of production in
China absent the market situation. Consistent with this approach, the Commission has
replaced the raw material coil costs for Chinese exporters on the basis they were not
normal competitive market costs. In doing so, the Commission has considered the
individual circumstances of the steel coil purchases and, to the greatest extent possible,
has ensured that the adjusted records reflect costs that would be incurred in China
without the distortion resulting from the influence of the GOC.
The Commission has examined in Non-confidential Appendix A3.1 the degree to which
steel coil prices in the Chinese domestic market have been distorted as a result of GOC
influence.
The Commission considers that the difference in price between verified purchases by the
cooperative Chinese exporter of steel coil (EXW, no delivery, excluding VAT) and a
competitive benchmark based on MEPS Korean and Taiwan steel coil prices is
representative of the level of distortion of Chinese steel coil prices, as from previous
cases the Commission considers that normal competitive market conditions prevail in the
Korean and Taiwanese domestic markets for steel coil79, and that purchases in these
markets are not influenced by prices in China.80 MEPS data was preferred due to
insufficient data provided by Korean and Taiwanese exporters to construct a benchmark
price: no data was provided by Korean exporters and exports of the goods by the sole
cooperating Taiwanese exporter represent a small volume of exports of the goods from
Taiwan during the investigation period.81
79 The Vietnamese steel coil market has previously been considered by the Commission to be subject to
normal competitive market conditions, but due to the allegation in this investigation that there is a particular
market situation in respect of Vietnamese exports of the goods, steel coil purchases by Vietnamese producers
have been excluded from this assessment.
80 See SEF 529 available on the Commission’s website.
81 See chapter 6.9.
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Comparative advantage and disadvantage
The Commission considered whether it is appropriate to make an adjustment to the

competitive benchmark to reflect any comparative advantages and disadvantages
experienced by the domestic Chinese producers.82
The Commission considers that for any adjustment to the benchmark to reasonably
reflect any comparative advantages and disadvantages, the Commission would need to:
 identify and quantify what the true, uninfluenced comparative advantage of the
domestic Chinese market is, distinct from any advantages which are a result of the
GOC influence;
 identify and quantify the comparative disadvantages of the Chinese domestic
market; and
 only adjust for those ‘true’ comparative advantages and disadvantages.
This would necessarily result in a determination of a ‘net’ figure in the form of an

adjustment.
Noting the complexity and extent of the GOC influence in the raw material market, the
Commission presently considers it is not possible to accurately isolate and quantify what
amount of any comparative advantage or disadvantage is enjoyed by the Chinese
domestic producers from the information before it.
Thus, in this case, the Commission considers an adjustment for comparative advantage
or disadvantage is not practicable or reasonable.
6.5.4 Calculation of the raw material cost adjustment
The steel coil costs have been determined by comparing the competitive benchmark cost
to the exporter’s actual costs for different coil types, in this case CRC and pre-galvanised
coil, and applying the resulting variation as an adjustment to the exporter’s records.
Scrap adjustment
Dalian Steelforce submitted as part of verification that scrap sales should also be
adjusted consistent with the adjustment to its coil input costs. The Commission did not
make this adjustment as it does not consider that the particular marker situation would
extend to the price achieved by Dalian Steelforce for the sale of its scrap.
6.6 Exporters
6.6.1 Exporter questionnaires
At the commencement of the investigation, the Commission contacted a number of

entities it had identified as possible exporters of the goods, based on information in the
82 Steelforce Trading Pty Ltd Parliamentary Secretary to the Minister for Industry, Innovation and Science
[2018] FCAFC 20 [118], [125] (Perram J).
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ABF import database and in Orrcon’s application, and invited them to complete an
exporter questionnaire.
The table below sets out those entities from whom the Commission received
questionnaire responses.
Country Name
Dalian Steelforce
China
Yantai Aoxin
Korea None
Taiwan Ta Fong
CDI
CDT
Hoa Phat Steel
Hoa Phat Binh Duong
Vietnam Hoa Phat Da Nang
Hoa Phat Long An
M&H
Nguyen Minh Steel
Vina One
Table 10: Exporter questionnaire responses
6.6.2 Sampling of exporters
Section 269TACAA(1) provides that where there is a dumping or countervailing

investigation and the number of exporters from a particular country of export in relation to
the investigation is so large that it is not practicable to examine the exports of all of those
exporters, the investigation may be carried out, and findings may be made, on the basis
of information obtained from an examination of a selected number of those exporters who
either constitute a statistically valid sample of those exporters or are responsible for the
largest volume of exports to Australia that can reasonably be examined.
Section 269T(1) provides that, in relation to a dumping investigation, an exporter who is

not an ‘uncooperative exporter’ and whose exports are selected to be examined as part of
the investigation is a ‘cooperative exporter’. An exporter who is not an ‘uncooperative
exporter’ and whose exports are not selected to be examined as part of the investigation
is a ‘residual exporter’.
6.6.3 Cooperative exporters
Following receipt of the REQs, the Commission determined that the number of exporters
from Vietnam was so large that it would not be practicable to examine the exports of all
responding Vietnamese exporters. Accordingly, pursuant to section 269TACAA(1), in
respect of exporters from Vietnam, the Commission determined to carry out the
investigation and make its findings based on information obtained from an examination of
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CDI and Vina One, as they are the two largest Vietnamese exporters of the goods to
Australia and together represent the majority of exports.83
As well as CDI and Vina One from Vietnam, Dalian from China and Ta Fong from Taiwan
were also cooperative exporters. There were no cooperative exporters from Korea.
6.6.4 Residual exporters
Hoa Phat Steel, Hoa Phat Long An and Nguyen Minh Steel were selected as residual
exporters from Vietnam.
There were no other residual exporters from any of the other subject countries.
6.6.5 Trading entities
The Manual provides that the Commission generally identifies the exporter as a principal
in the transaction, located in the country of export from where the goods were shipped,
that:
 gave up responsibility by knowingly placing the goods in the hands of a carrier,

courier, forwarding company, or its own vehicle for delivery to Australia; or
 owns, or previously owned, the goods, but need not be the owner at the time the
goods were shipped.
The Manual notes that it is common for traders or other intermediaries to play a role in the
exportation of the goods. These parties will typically provide services such as arranging
transportation (both land and ocean), arranging port services, arranging loading,
conducting price negotiations, arranging contracts with producer and customer alike,
conveying the customer’s specifications to the producer including quality, marking, and
packing requirements, and so forth.
Typically the manufacturer, as a principal who knowingly sent the goods for export to any
destination will be the exporter.
Consistent with the Manual, the Commission has determined that a number of REQs
received were from entities who were not exporters of the goods during the investigation
period, but are instead acting as an intermediary for the actual exporter, who may or may
not have submitted an REQ to the investigation. These entities are discussed below.
Five Steel (Tianjin) Tech Co.,Ltd
Five Steel provided an REQ to the Commission within the required timeframe.84 Following
an initial review of the information provided, the Commission formed the view that Five
Steel was not an exporter of the goods for the purposes of the investigation, but is instead
a trading company. The Commission informed Five Steel of this assessment and invited
Five Steel to respond and further explain its role in the exportation process if it disagreed
with this finding. Five Steel was also advised that its REQ contained a number of
83 Confidential Attachment 2 – Australian market analysis.

84 Confidential Attachment 6 – Five Steel REQ.
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deficiencies which would also need to be addressed before their response could be
considered capable of verification.
Five Steel provided a further response to the Commission, but this was not considered to
provide evidence satisfactory to the Commission as to its status as a trader, nor did it
address the deficiencies in the REQ.85 Accordingly, the information provided in Five
Steel’s REQ was not considered further and was not published on the EPR.
Yantai Aoxin
Yantai Aoxin was granted an extension to provide an REQ to the Commission and did so
before the extended deadline. Following receipt of its REQ, the Commission identified a
number of deficiencies in its response. Yantai Aoxin was requested to address these
deficiencies in a revised REQ, which it subsequently did so.86
Following a review of its revised REQ, in which Yantai Aoxin identified itself as a trader of
the goods, the Commission sent a further series of questions on 4 September 2020 to
clarify its exporter status. Yantai Aoxin provided its response to the Commission on
12 September 2020.87
As a result of the assessment of Yantai Aoxin’s REQ and its answers to the subsequent
clarifying questions sent by the Commission, the Commission does not consider Yantai
Aoxin to be an exporter of the goods because:
 Yantai Aoxin does not manufacture the goods;

 The goods Yantai Aoxin sells to its Australian customers are purchased from a
manufacturer of the goods who was informed by Yantai Aoxin that the end
customer of the goods was an Australian company who required the goods to meet
Australian standards.
Accordingly, as the manufacturer of the goods sold the goods to Yantai Aoxin knowing
that they would be later exported, the Commission considers the manufacturer to be the
exporter.
CDT
CDT was granted an extension to provide an REQ to the Commission and did so before
the extended deadline. Following receipt of its REQ, the Commission identified a number
of deficiencies in its response. CDT was requested to address these deficiencies in a
revised REQ, which it subsequently did so.88
A review of CDT’s REQ indicated that CDT did not manufacture goods during the
investigation period and that the goods exported by CDT to Australia were purchased
85 Confidential Attachment 7 – Email exchange between the Commission and Five Steel.
86 EPR 550, Item 37.
87 Confidential Attachment 8 – Yantai Aoxin response to request for further information.
88 EPR 550, Item 26.
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from and manufactured by its related party entity, CDI. This was confirmed during
verification of CDI.89
Based on the related-party relationship between CDI and CDT, the Commission
considers that, in respect of goods exported to Australia by CDT during the investigation
period, CDI was aware that those goods sold to CDT would be not be sold domestically
and would be exported, either to Australia or another third country market. Accordingly,
the Commission considers that all goods exported to Australia through CDT during the
investigation period were exported by CDI, with CDT acting as a trader.
Hoa Phat Binh Duong
Hoa Phat Binh Duong was granted an extension to provide an REQ to the Commission
and did so before the extended deadline. Following receipt of its REQ, the Commission
identified a number of deficiencies in its response. Hoa Phat Binh Duong was requested
to address these deficiencies in a revised REQ, which it subsequently did so.90
A review of Hoa Phat Binh Duong’s REQ indicated that it did not manufacture the goods
exported to Australian during the investigation period and that the goods exported to
Australia were purchased from and manufactured by a related party entity.91
Based on the related-party relationship between Hoa Phat Binh Duong and the
manufacturer, the Commission considers that, in respect of goods exported to Australia
by Hoa Phat Binh Duong during the investigation period, the manufacturer of the goods
was aware that those goods sold to Hoa Phat Binh Duong would not be sold domestically
and would be exported, either to Australia or another third country market. Accordingly,
the Commission considers that all goods exported to Australia through Hoa Phat Binh
Duong during the investigation period were exported by the manufacturer, with Hoa Phat
Binh Duong acting as a trader.
M&H
M&H was granted an extension to provide an REQ to the Commission and did so before
the extended deadline. Following receipt of its REQ, the Commission identified a number
of deficiencies in its response. M&H was requested to address these deficiencies in a
revised REQ, which it subsequently did so.92
Following a review of its revised REQ, the Commission sent a subsequent series of
questions to M&H on 4 September 2020 to clarify its status as an exporter of the goods.
M&H provided its response to the Commission on 18 September 2020.
89 CDI Verification Report, Chapter 3.1, EPR 550, Item 45.

90 EPR 550, Item 28.
91 Confidential Attachment 9 – Hoa Phat Binh Duong Exhibit G-5.
92 EPR 550, Item 32.
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As a result of the assessment of M&H’s REQ and its answers to the subsequent clarifying
questions sent by the Commission93, the Commission does not consider M&H to be an
exporter of the goods because:
 M&H does not manufacture the goods;

 M&H purchases the goods from only one manufacturer; and
 The Commission considers that the manufacturer of the goods sold to M&H was
aware that those goods would be not be sold domestically and would be exported,
either to Australia or another third country market, as it was informed by M&H that
the goods were to be exported and it loaded the goods for transport to the port of
departure.
6.6.6 Other entities
Hoa Phat Da Nang
Hoa Phat Da Nang was granted an extension to provide an REQ to the Commission and
did so before the extended deadline. Following receipt of its REQ, the Commission
identified a number of deficiencies in its response. Hoa Phat Da Nang was requested to
address these deficiencies in a revised REQ, which it subsequently did so.94
A review of Hoa Phat Da Nang’s REQ indicated that it did not export the goods to
Australia during the investigation period. Accordingly, pursuant to section 269TDA(1), as
there has been no dumping of the goods during the investigation period (as there have
been no exports), the Commission must terminate the investigation, in so far as it relates
to Hoa Phat Da Nang.
6.6.7 Uncooperative exporters
Section 269T(1) provides that an exporter is an “uncooperative exporter” where the

Commissioner is satisfied that an exporter did not give the Commissioner information that
the Commissioner considered to be relevant to the investigation within a period the
Commissioner considered to be reasonable, or where the Commissioner is satisfied that
an exporter significantly impeded the investigation. Section 8 of the Customs (Extensions
of Time and Non-cooperation) Direction 2015 (the Customs Direction) sets out that the
Commissioner must determine an exporter to be an uncooperative exporter, on the basis
that no relevant information was provided in a reasonable period, if that exporter fails to
provide a response or fails to request a longer period to do so within the legislated period.
The Commissioner considered the Customs Direction and determined that any exporter
which did not do any of the following is an uncooperative exporter for the purposes of this
investigation:
 provide a REQ to the Commission; or

 request a longer period to provide a response within the legislated period; or
93 EPR 550, Item 42.

94 EPR 550, Item 29.
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 address requests for further information where REQs were given to the
Commission.95
6.7 Dumping assessment – China

6.7.1 Dalian Steelforce
Verification
The Commission conducted a remote verification of Dalian Steelforce’s REQ.
The Commission is satisfied that Dalian Steelforce is the producer of the goods. The
Commission is further satisfied that the information provided by Dalian Steelforce is
accurate and reliable for the purpose of ascertaining the variable factors applicable to its
exports of the goods.
A report covering the verification findings is available on the public record.96
Export price
The Commission considers Dalian Steelforce to be the exporter of the goods as Dalian
Steelforce:
 is the manufacturer of the goods;

 is named on the commercial invoice as the supplier;
 is named as consignor on the bill of lading;
 arranges and pays for the inland transport to the port of export; and
 arranges and pays for the port handling charges at the port of export.
The Commission is satisfied that for all Australian export sales during the period that
Dalian Steelforce was the exporter of the goods.
In respect of Dalian Steelforce’s export sales of the goods during the period, all of which
were to its related intermediary, Steelforce Trading, and related party importer in
Australia, Steelforce Australia, the Commission found no evidence that:
 there was any consideration payable for, or in respect of, the goods other than
price; or
 the price appeared to be influenced by a commercial or other relationship between
the buyer (or an associate of the buyer) and the seller; or
 the buyer (or an associate of the buyer), was directly or indirectly reimbursed,
compensated or otherwise receive a benefit for, or in respect of, the whole or any
part of the price.
The Commission therefore considers that all export sales made by Dalian Steelforce
during the period were ‘arms length’ transactions.
95 Requests for further information are contained in deficiency letters.

96 EPR 550, Item 46.
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The Commission considers that for the goods imported by Steelforce Australia from
Dalian Steelforce, via Steelforce Trading:
 the goods have been exported to Australia otherwise than by the importer;
 the goods have not been purchased by the importer from the exporter; and
 the purchases of the goods by the importer were ‘arms length’ transactions.
As the goods are not purchased by the importer from the exporter (they were purchased
by Steelforce Australia from Steelforce Trading), the export price cannot be established
under sections 269TAB(1)(a) or (b). The Commission determined an export price under
section 269TAB(1)(c), using the price between Dalian Steelforce and Steelforce Trading.
Normal value
During verification, the Commission found that because of the absence of sales of like
goods in the market of the country of export that would be relevant for the purpose of
determining a price under section 269TAC(1), the normal value of goods exported to
Australia cannot be ascertained under section 269TAC(1).
The Commission is also satisfied that, due to a situation in the domestic market for the
goods in China, sales in that market are not suitable for use in determining a normal value
under section 269TAC(1).
The Commission has relied upon the finding of a market situation, in accordance with
section 269TAC(2)(a)(ii) to calculate a normal value under section 269TAC(2)(c) using
the sum of:
 the CTM that reasonably reflects competitive market costs in accordance with
section 43(2) of the Regulations;
 domestic selling, general and administrative expenses (SG&A) on the assumption
that the goods, instead of being exported, were sold domestically based on the
company’s records in accordance with section 44(2) of the Regulations; and
 an amount for profit based on data relating to the production and sale of like goods
on the domestic market in the OCOT97 in accordance with section 45(2) of the
Regulations.
CTM reasonably reflecting competitive market costs
The Commission has assessed the raw material input costs in the CTM for Dalian
Steelforce. While the Commission established during verification that its records relating
to the goods have been kept in accordance with the relevant GAAP and reasonably
reflect the costs associated with the production and sale of the goods, the Commission
was not satisfied that its costs reasonably reflect competitive market costs associated
with the production of like goods, due to the influence of the GOC in the domestic
Chinese market for raw materials, in this case HRC. Specifically, the Commission
97 Section 269TAAD states that domestic sales of like goods are not in the OCOT if ‘arms length’ transactions
are unprofitable in substantial quantities over an extended period and unlikely to be recoverable within a
reasonable period. For the purposes of this investigation the “extended period” and “reasonable period” are
considered to be the investigation period.
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considers that HRC costs in China, which make up a major proportion of the total costs of
production of the goods, are distorted by GOC influence and do not reasonably reflect
competitive market costs associated with the production or manufacture of the goods in
accordance with section 43(2)(b)(ii) of the Regulations. Accordingly, the Commission
considers it appropriate that HRC costs relating to the costs of production in Dalian
Steelforce’s records be adjusted to reflect competitive market costs as detailed in chapter
6.5 above.
Adjustments
The Commission is satisfied that there is sufficient information to justify the following
adjustments in accordance with section 269TAC(9). The Commission considers these
adjustments to be necessary to ensure a fair comparison of normal values and export
prices.
Adjustment Type Deduction/addition

Export inland transport and port charges Add an amount for export inland transport and port charges
Non-refundable VAT Add an amount for non-refundable VAT
Table 11 – Summary of adjustments – Dalian Steelforce
Dumping margin
The dumping margin in respect of the goods exported to Australia by Dalian Steelforce for
the investigation period is 2.9%.
The Commission’s calculations are included at Confidential Attachments 10 to 13.
6.7.2 Residual exporters – China
There were no residual exporters from China.
6.7.3 Uncooperative exporters – China
As detailed in chapter 6.6.7, the Commission considers all exporters of the goods from
China, other than Dalian Steelforce, are uncooperative exporters for the purposes of this
investigation.
Section 269TACAB(1) sets out the provisions for calculating export prices and normal
values for uncooperative exporters.
Export prices
Pursuant to section 269TACAB(1)(d), the Commission has determined an export price for
the uncooperative exporters pursuant to section 269TAB(3), having regard to all relevant
information.
The Commission has examined the ABF database and observed that exports of the
goods by the sole cooperating exporter constitute a significant volume of all exports of the
goods from China during the investigation period. The Commission has also compared
the verified weighted average FOB export price of the cooperating exporter to the
weighted average FOB export prices of other Chinese exporters reported in the ABF
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database98 and notes that 72% of export volume from other exporters are within one
standard deviation of the cooperating exporter’s export price as reported in the ABF
database.
Accordingly, the Commission considers that the verified export price of the cooperating
exporter is representative of uncooperative Chinese exporters of the goods during the
investigation period, based on the information before the Commission. The Commission
has used this value for determining the export price for the uncooperative exporters.
Normal value
Pursuant to section 269TACAB(1)(e), the Commission has determined the normal value
for the uncooperative exporters pursuant to section 269TAC(6) after having regard to all
relevant information. Specifically, the Commission has used the normal value established
for the sole cooperating Chinese exporter in the investigation period.
The Commission has chosen the normal value of the sole cooperating exporter on the
basis that:
 the Commission does not have specific information relating to the uncooperative
exporters, relevant to the calculation of the normal value; and
 the normal value of the cooperating exporter demonstrates a price at which an
uncooperative exporter may sell the goods in the domestic Chinese market, based
on the information before the Commission.
Dumping margin
The dumping margin in respect of the goods exported to Australia by uncooperative

Chinese exporters for the investigation period is 2.9%.
The Commission’s calculations are included in Confidential Attachment 14.
6.7.4 Summary of dumping margins
The Commission has assessed that the goods exported to Australia from China during
the investigation period by:
 Dalian Steelforce were dumped at a margin of 2.9%; and

 Uncooperative exporters from China were dumped at a margin of 2.9%.
6.7.5 Volume of dumped imports
Pursuant to section 269TDA(3), the Commissioner must terminate the investigation, in so

far as it relates to a country, if satisfied that the total volume of goods that have been or
may be dumped is a negligible volume. Section 269TDA(4) defines a negligible volume as
98 See chapter Error! Reference source not found. for further detail on the method used by the Commission
for removing distortions from the ABF import database data.
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less than 3% of the total volume of goods imported into Australia over the investigation
period, where section 269TDA(5) does not apply. It does not apply to this investigation.
Using the ABF import database and having regard to the information collected and
verified during the investigation, the Commission determined the volume of imports in the
Australian market. Based on this information, the Commission is satisfied that, when
expressed as a percentage of the total Australian import volume of the goods, the volume
of goods that have been exported from China and dumped was greater than 3% of the
total import volume, and is therefore not negligible.
The Commission’s calculations are at Confidential Attachment 2.
6.7.6 Level of dumping
Section 269TDA(1) provides that the Commissioner must terminate a dumping

investigation, in so far as it relates to an exporter of the goods, if satisfied that there has
been no dumping by the exporter of any of those goods, or if satisfied that there has been
dumping by the exporter of some or all of those goods, but the dumping margin for the
exporter is less than 2%.
As found previously in this chapter, the Commission is satisfied that there has been
dumping of the goods by all Chinese exporters during the investigation period and the
dumping margin for all Chinese exporters of the goods is more than 2%.
6.8 Dumping assessment – Korea

6.8.1 Cooperating and Residual exporters – Korea
There were no cooperating or residual exporters from Korea.
6.8.2 Uncooperative exporters – Korea
The Commission considers all exporters of the goods from Korea are uncooperative
exporters for the purposes of this investigation.
Export prices
the uncooperative Korean exporters pursuant to section 269TAB(3), having regard to all
relevant information.
In the absence of any data from cooperating Korean exporters which may be
representative of the export price of uncooperative exporters, the Commission has used
the lowest weighted average FOB export price for the investigation period of Korean
exporters who exported to Australia during the investigation period, as reported in the
ABF import database. The weighted average export price is calculated using all exports of
the goods by that exporter during the investigation period, which constitutes a significant
majority of exports from Korea.
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The Commission has chosen the lowest export price on the basis that the lowest
weighted average export price demonstrates a price at which an uncooperative exporter
may export goods to Australia, based on the information before the Commission.
Normal value
relevant information. Specifically, the Commission has constructed a normal value for
uncooperative Korean exporters as follows:
 raw material coil costs were calculated using MEPS pricing data for Korea for a
mixture of different coil types, based on Korean importer data verified during the
investigation; plus
 average other raw material unit costs based on verified data for third country
exporters of the goods; plus
 average labour costs based on verified data for third country exporters of the
goods, adjusted for Korea using data from a reputable independent supplier of
economic data; plus
 average manufacturing costs, other costs and scrap offset value based on verified
data for third country exporters of the goods; plus
 SG&A costs for Korean exporters on sales of goods of the same general
category99; plus
 average profit based on verified data for third country exporters of the goods; plus
 the highest inland transport and export handling costs based on verified data for
third country exporters of the goods.
Dumping margin

Korean exporters for the investigation period is 6.2%.
The Commission’s calculations are included in Confidential Attachments 14 to 15.
6.8.3 Volume of dumped imports
Using information from the ABF import database and having regard to the information
collected and verified during the investigation, the Commission is satisfied that, when
expressed as a percentage of the total Australian import volume of the goods, the volume
of goods that have been exported from Korea and dumped was greater than 3% of the
total import volume, and is therefore not negligible.100
The Commission’s calculations are at Confidential Attachment 2.
99 The Commission has SG&A cost data for Korean exporters of the goods from other investigations into
products in the same general category as the goods and so has used this data to work out SG&A in
accordance with section 44(3)(a) of the Regulations.
100 See chapter 6.7.5 for further discussion on termination of an investigation due to a negligible level of
dumped imports.
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The Commission is satisfied that there has been dumping of the goods by all Korean
exporters during the investigation period and the dumping margin for all Korean exporters
of the goods is more than 2%.101
6.9 Dumping assessment – Taiwan

6.9.1 Ta Fong
Verification
The Commission conducted a remote verification of Ta Fong’s REQ.
The Commission is satisfied that Ta Fong is the producer of the goods and like goods.
The Commission is further satisfied that the information provided by Ta Fong is accurate
and reliable for the purpose of ascertaining the variable factors applicable to its exports of
the goods.
Submission in response to the verification report
In a submission dated 1 March 2021,103 Orrcon made the following comments:
 The Commission’s offsetting of scrap costs in Ta Fong’s CTMS differs from its
findings in Review 529 into HSS (REV 529),104 where the Commission made no
adjustments for Ta Fong’s lack of scrap allocation. Orrcon submits that Ta Fong’s
scrap allocation is consistent in its manufacture of HSS and precision pipe and
tube steel. Accordingly, the method used in REV 529 should be followed, and no
scrap adjustment made in the current investigation;
 The allocation of costs in Ta Fong’s CTMS is based on sales revenue, which is
inconsistent with the allocation for Ta Fong in REV 529 and other exporter
verifications in this investigation for Dalian Steelforce and CDI;
 In considering whether there are insufficient domestic sales of similar models, the
Commission does not need to look further if there are no models in the same “key”
MCC category;
 The Commission will need to ensure products which are not the goods are not
included in its domestic sales listing and will need to examine mill certificates to
confirm that the goods have been manufactured to a recognised Taiwanese
standard for precision pipe and tube;
101 See chapter 6.7.6 for further discussion on termination of an investigation due to a level of dumping less
than 2%.
102 EPR 540, Item 44.
103 EPR 550, Item 51.
104 Review 529 into HSS from China, Korea, Malaysia, Taiwan and Thailand, available on the Commission’s
website.
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 The Commission ought to review its dumping margin calculations given the large
discrepancy between the dumping margin found in this investigation and REV 529.
Commission’s assessment
Scrap costs
As Ta Fong was unable to distinguish revenue derived from sales of scrap from the
production of the goods and revenue from scrap sales from all other production, it made
no offset to its CTM for the goods in its REQ. The Commission was able to verify revenue
derived from the sale of scrap from all general production and proceeded to estimate
revenue from scrap sales from the production of the goods based on sales volumes of the
goods in order to properly account for this cost offset to the CTM. The Commission
considers that not offsetting scrap costs would result in a higher CTM than was actually
incurred in the production of the goods by Ta Fong.
Allocation of costs
The allocation of costs in Ta Fong’s CTMS is not based on sales revenue, as stated by
Orrcon, but on sales quantity.
As noted in Exception 3 to the Ta Fong Verification Report105, the Commission was

unable to reconcile CTM to the audited accounts for Ta Fong. Due to this difference in
this verification compared to REV 529 and the verification of other exporters in this
investigation, the Commission has instead relied on the actual cost of goods sold data
from Ta Fong’s sales system to verify its CTM data.
MCC matching
The Manual provides that where there are no sales or insufficient sales of identical
models of the goods exported to Australia that are sold in the ordinary course of trade on
the domestic market, the Commission may use a surrogate model.
In this instance, the Commission chose MCC P-H-2-N-1-C-1-N-A-2-P as the surrogate

model for P-H-2-N-1-C-1-N-B-2-P. The variance between these models was the product
thickness. Analysis of the domestic selling prices of the exported model and the surrogate
model revealed pricing was within 0.2%, which was considered negligible.
The Commission also notes no key MCC categories were identified in respect of the
goods in this investigation.
Goods verification
During verification, the Commission selected fifteen domestic sales by Ta Fong for testing
downwards to source documents. Ta Fong provided purchase orders, internal order
acceptance documents, ERP system order entry details, packing lists, commercial invoice
and proof of payment as part of this process. The Commission was able to verify the
product codes, base, shape, diameter, thickness, volume, pieces and values back to the
105 EPR 550, Item 44.
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sales listing. From this examination, the Commission is satisfied that the domestic sales
listing appropriately represents domestic sales of the goods by Ta Fong.
Dumping margin
The dumping margin calculations for Ta Fong have been reviewed for quality and
accuracy, as per the Commission’s standard operating procedures.
Export price
The Commission considers Ta Fong to be the exporter of the goods, as Ta Fong is:
 the manufacturer of the goods;

 named on the commercial invoice as the supplier;
 named as consignor on the bill of lading;
 arranges and pays for the inland transport to the port of export;
 arranges and pays for the port handling charges at the port of export;
 arranges and pays for the ocean freight and marine insurance.
The Commission is satisfied that for all Australian export sales during the investigation
period, Ta Fong was the exporter of the goods.
Ta Fong did not have export sales of the goods to any related customers in Australia
during the period.
In respect of Ta Fong’s Australian sales of the goods to its unrelated customers during
the period, the verification team found no evidence that:
price; or
the buyer, or an associate of the buyer, and the seller, or an associate of the seller;
or
 the buyer, or an associate of the buyer, was directly or indirectly reimbursed,
compensated or otherwise received a benefit for, or in respect of, the whole or any
part of the price.
The Commission therefore considers that all export sales made by Ta Fong to its
Australian customers during the period were ‘arms length’ transactions.
In respect of Australian sales of the goods by Ta Fong, the Commission has determined
an export price under section 269TAB(1)(a), being the price paid by the importer to the
exporter, less transport and other costs arising after exportation.
Normal value
The Commission did not find any evidence of related party transactions related to Ta
Fong’s domestic sales.
In respect of Ta Fong’s domestic sales of like goods to its unrelated customers during the
period, the Commission found no evidence that:
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price; or
or
 the buyer, or an associate of the buyer, was not directly or indirectly reimbursed,
part of the price.106
The Commission therefore considers that all domestic sales made by Ta Fong to its
domestic customers during the period were ‘arms length’ transactions.
As detailed in the Ta Fong verification report, the Commission assessed the total volume
of relevant sales of like goods as a percentage of the goods exported to Australia and
found that the volume of sales was not less than 5%.
When calculating a normal value under section 269TAC(1), in order to ensure a proper
comparison between the goods exported to Australia and the goods sold on the domestic
market, the Commission considers the volume of sales of each exported MCC on the
domestic market. Where the volume of domestic sales of an exported model is less than
5% of the volume exported, the Commission will consider whether a proper comparison
can be made at the MCC level. In these situations, the Commission may consider
whether a surrogate domestic model should be used to calculate normal value for the
exported model. This is detailed in the table below.
Export MCC Comment Surrogate MCC

P-H-2-N-1-C-1-N-B-2-P Volume of domestic sales P-H-2-N-1-C-1-N-A-2-P has been used as it is
model is less than 5% of the next most comparable model. Domestic
the exported volume. sales of this model are greater than 5% of the
exported volume.
Table 12 – Surrogate export model – Ta Fong
Adjustments
The Commission is satisfied there is sufficient information to justify the following

prices.

Domestic credit terms Deduct an amount for domestic credit
Domestic inland transport Deduct an amount for domestic inland transport
Export inland transport Add an amount for export inland transport
Export port and handling charges Add an amount for port charges
Export credit terms Add an amount for export credit terms
106 Section 269TAAD refers.
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Table 13: Summary of adjustments – Ta Fong
Dumping margin
The dumping margin in respect of the goods exported to Australia by Ta Fong for the
investigation period is negative 9.0%.
6.9.2 Residual exporters – Taiwan
There were no residual exporters from Taiwan.
6.9.3 Uncooperative exporters – Taiwan
Taiwan, other than Ta Fong, are uncooperative exporters for the purposes of this
investigation.
Export prices
information.
The Commission has examined the ABF database and observed that exports of the
goods by the sole cooperating exporter represent a small volume of exports of the goods
from Taiwan during the investigation period. The Commission has also compared the
verified weighted average FOB export price of the cooperating exporter to the weighted
average FOB export prices of other Taiwanese exporters reported in the ABF
database.107 The Commission observes that 81% of export volumes from other
Taiwanese exporters are within one standard deviation of the cooperating exporter’s
export price, as reported in the ABF database.
The Commission has then compared the verified export price for Ta Fong against its FOB
export price, as reported in the ABF import database, and has observed a 4% difference
between the two values.
After considering the volume of Taiwanese exports made up by Ta Fong exports, the
volume of Taiwanese exports within one standard deviation of Ta Fong’s export price and
the desirability of using verified exporter data rather than data from the ABF import
database, the Commission considers that the verified export price of the cooperating
exporter is likely to be a more accurate representation of the export price for
uncooperative Taiwanese exporters of the goods during the investigation period. Based
107See chapter Error! Reference source not found. for further detail on the method used by the
Commission for removing distortions from the ABF import database data.
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on the information before it, the Commission, has used this value for determining the
export price for the uncooperative exporters.
Normal value
relevant information. Specifically, the Commission has used the normal value established
for the sole cooperating Taiwanese exporter in the investigation period, less favourable
adjustments.
The Commission has chosen the normal value of the sole cooperating exporter on the
basis that:
 the normal value of the cooperating exporter, less favourable adjustments,
demonstrates a price at which an uncooperative exporter may sell the goods in the
domestic Taiwanese market, based on the information before the Commission.
Dumping margin

Taiwanese exporters for the investigation period is negative 8.6%.
The Commission has assessed that the goods exported to Australia from Taiwan during
the investigation period by:
 Ta Fong were not dumped as the dumping margin for this exporter was negative
(i.e. -9.0%); and
 Uncooperative exporters from Taiwan were not dumped as the dumping margin
was negative (i.e. -8.6%).
Section 269TDA(1)(b)(i) provides that the Commissioner must terminate a dumping

been no dumping by the exporter of any of those goods.
The Commission is satisfied that there has been no dumping of the goods during the
investigation period by Ta Fong or Taiwanese uncooperative exporters. Accordingly, the
Commissioner proposes to terminate the dumping investigation as it relates to all
Taiwanese exporters, pursuant to section 269TDA(1)(b)(i).
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6.10 Dumping Assessment - Vietnam

6.10.1 CDI
Verification
The Commission conducted a remote verification of CDI’s REQ.
The Commission is satisfied that CDI is the producer of the goods and like goods. The
Commission is further satisfied that the information provided by CDI is accurate and
reliable for the purpose of ascertaining the variable factors applicable to its exports of the
goods.
Submissions in response to the verification report – Orrcon
In a submission dated 1 March 2021109, Orrcon made the following comments:
 In considering whether there is an absence of competitive market costs in Vietnam,

the Commission is reminded that Vietnamese subject good producers have likely
sold at a loss during the investigation period.
The presence or absence of competitive market costs is relevant where a constructed

normal value has been used under section 269TAC(2)(c). As discussed under “Normal
Value” below, the normal value for CDI has been determined under section 269TAC(1).
Accordingly, the consideration of whether CDI’s records reasonably reflect competitive
market costs is not required. The Commission notes that it did not find unprofitable sales
of domestic goods in substantial volumes for the cooperating exporters during the
Submissions in response to the verification report – CDI
In a submission dated 9 March 2021110, CDI made the following comments in respect of
the assessment of the export price:
 Generic price offers/quotes are made to Australian customers. When a purchase

order is received from the Australian customer at the quoted or negotiated price,
CDI or CDT decides which entity will issue the customer’s sales contract. The
decision is based on a family internal profit-sharing arrangement. CDI and CDT are
related by family ownership;
 In respect of Australian sales of the goods by CDI, where CDI exported the goods
through CDT, the Commission ought to reconsider the determination of export
price under section 269TAB(1)(c). CDI recommended that the export price be
108 EPR 550, Item 45.

109 EPR 550, Item 51.
110 EPR 550, Item 52.
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determined as the price negotiated between the Australian customer and

CDI/CDT;
 CDI disagrees that domestic sales made by CDI to CDT were ‘arms length’
transactions as the price is influenced by a commercial or other relationship
between the buyer and the seller, and that some consideration, other than the
price is payable, being the family internal profit-sharing arrangements. The
Commission ought to consider sales between CDI and CDT to be non-arms-length
sales made by CDI and therefore excluded from normal value calculations.
As discussed in chapter 6.2.2, section 269TAB(1)(a) generally provides that the export
price of any goods exported to Australia is the price paid for the goods by the importer
where the goods have been exported to Australia otherwise than by the importer, and
have been purchased by the importer from the exporter in ‘arms length’ transactions.
During verification, the Commission determined that CDI was the exporter of those goods
sold by CDT to Australian importers (this is discussed further under “Export Price”).
Accordingly, as the goods sold by CDT were not purchased by the importer from the
exporter, regardless of whether those sales were ‘arms length’, the export price for CDT
sales could not be determined under section 269TAB(1)(a) or section 269TAB(1)(b),
leaving only section 269TAB(1)(c) available to determine the export price.
Further, if CDI’s submission that domestic sales made by CDI to CDT were not ‘arms
length’ is accepted, then the export price could not be determined under section
269TAB(1)(a), as it is a requirement that sales are ‘arms length’ transactions. Section
269TAB(1)(b) is also not available as (in addition to CDT not being the exporter) the
Commission was not provided with evidence showing that the goods were subsequently
sold by the importer, in the condition they were imported, to an unrelated party.
Export price
The Commission considers CDI to be the exporter of the goods as CDI:

 knowingly sent the goods for export to Australia or a third country. During the
investigation period, CDI sometimes exported the goods directly and in other
cases, through CDT.
The Commission is satisfied that for all Australian export sales during the investigation
period, CDI was the exporter of the goods.
CDI did not have export sales of the goods to any related customers in Australia during
the period.
In respect of CDI’s direct Australian sales of the goods to its unrelated customers during
the period, the Commission found no evidence that:
price; or
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or
 the buyer, or an associate of the buyer, was directly or indirectly reimbursed ,
The Commission therefore considers that all direct export sales made by CDI to its
unrelated Australian customers during the period were ‘arms length’ transactions.
In respect of Australian sales of the goods by CDI, where CDI exported the goods
directly, the Commission has determined an export price under section 269TAB(1)(a),
being the price paid by the importer to the exporter, less transport and other costs arising
after exportation.
In respect of Australian sales of the goods by CDI, where CDI indirectly exported through
CDT, the Commission has determined an export price under section 269TAB(1)(c), being
the price determined having regard to all the circumstances of the exportation. This is
because these particular goods exported to Australia were not purchased by the importer
from the exporter, but were instead purchased by the importer from CDT. The
Commission has determined an export price for these goods, as the price paid to CDI by
CDT plus inland transport and port handling costs, in order to makes these sales on the
same terms as goods exported directly by CDI.
Normal value
In the verification report for CDI112, the Commission found no evidence that domestic
sales made by CDI to its related customers during the period were not ‘arms length’
transactions. However, as noted in its submission of 9 March 2021, CDI advised the
Commission that domestic sales made by CDI to related party CDT were not ‘arms
length’ as consideration other than price was payable, in the form of internal profit-sharing
arrangements between family members with shares in both companies
Accordingly, domestic sales between CDI and CDT are not considered ‘arms length’ and
have been excluded from the calculation of normal value.
In respect of CDI’s domestic sales of like goods to its unrelated customers during the
period, the Commission found no evidence that:
 there was any consideration payable for, or in respect of, the goods other than its
price; or
or
111 Section 269TAA refers.
112 EPR 550, Item 45.
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The Commission therefore considers that all domestic sales made by CDI to its unrelated
customers during the period were ‘arms length’ transactions.
The application claimed that the market in the country of export is such that sales in that
market are not suitable for use in determining a normal value under section 269TAC(1), in
accordance with section 269TAC(2)(a)(ii). The application also claimed that CDI’s records
do not reasonably reflect competitive market costs associated with the production or
manufacture of like goods.
The Commission has determined that a particular market situation did not exist in respect
of the domestic market for precision pipe and tube steel in Vietnam for the investigation
period. The Commission therefore considers it appropriate to calculate a normal value
under section 269TAC(1), excluding those sales to its related party CDT.
The Commission assessed the total volume of relevant sales of like goods as a
percentage of the goods exported to Australia and found that the volume of sales was not
less than 5%.
G-C-N-1-N-L2-T1 Volume of domestic sales G-R-N-N-3-L2-T1 has been used as a

model is less than 5% of the surrogate to make a specification
G-C-N-2-N-L2-T1 exported volume. adjustment as it is the next most
comparable model. Domestic sales of the
surrogate model are greater than 5% of the
exported volume.
G-R-N-N-3-L1-T2 Volume of domestic sales G-R-N-N-3-L2-T1 has been used as a

exported volume. adjustment and timing adjustment. Due to a
lack of sales data for G-R-N-N-3-L2-T1 in
the Dec-19 quarter, the Commission has
used the difference in the production costs
for the surrogate model between quarters to
make the timing adjustment.
113 Ibid.
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Domestic sales of the surrogate model are

greater than 5% of the exported volume.
G-R-O-N-2-L2-T2 Volume of domestic sales G-R-N-N-2-L2-T2 has been used as a

exported volume. adjustment as it is the next most
comparable model. Domestic sales of this
model are greater than 5% of the exported
volume.
G-R-O-N-3-L2-T2 Volume of domestic sales G-R-N-N-3-L2-T2 has been used as a

exported volume. adjustment as it is the next most
comparable model. Domestic sales of this
model are greater than 5% of the exported
volume.
Table 14 - Surrogate export model - CDI
Adjustments

prices.

Domestic other costs Deduct an amount for domestic other costs
Export port charges Add an amount for port charges
Export other costs Add an amount for ‘other costs’
Table 15: Summary of adjustments - CDI
Dumping Margin
The dumping margin in respect of the goods exported to Australia by CDI for the
6.10.2 Vina One
Verification
The Commission conducted a remote verification of Vina One’s REQ.
The Commission is satisfied that Vina One is the producer of the goods and like goods.
The Commission is further satisfied that the information provided by Vina One is accurate
and reliable for the purpose of ascertaining the variable factors applicable to its exports of
the goods.
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Submission in response to the verification report
In a submission dated 1 March 2021115, Orrcon requested that the source used by the
Commission in comparing Vina One’s HRC purchase price against benchmark prices be
disclosed to allow all interested parties to validate the Commission’s finding that Vina
One’s CTMS data was accurate, on the basis that “…Vietnamese HRC pricing is lower
than available Asia-regional price benchmarks, and that this therefore translates into a
lower than-competitive market price for subject goods selling prices in Vietnam.”
The benchmark used by the Commission was based on prices out of Vietnam. The
Commission notes that the comparison to the benchmark was for the purposes of
verifying the accuracy of Vina One’s CTMS data and was not in relation to whether these
costs were representative of a competitive market price. Having been satisfied that the
data was accurate and reliable, the use of a benchmark from a different market to that in
which Vina One actually purchased HRC would not be informative for the purpose of
verification. As contemplated elsewhere in this report, the Commission has concluded
that a market situation is not operative in Vietnam in respect of the like goods.
Export price
The Commission considers Vina One to be the exporter of the goods because Vina One:
 is the principal located in Vietnam, the country of export;

 is named on the commercial invoice as the supplier;
 is named as consignor on the bill of lading;
 arranges transportation of the goods to the port of export in Australia; and
 knowingly placed the goods in the hands of a freight company for delivery to
Australia.
The Commission is satisfied that, for all Australian export sales during the investigation
period, Vina One was the exporter of the goods.
Vina One did not have export sales of the goods to any related customers in Australia
during the period.
In respect of Vina One’s Australian sales of the goods to its unrelated customers during
price; or
114 EPR 550, Item 47.

115 EPR 550, Item 51.
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or
part of the price116.
The Commission therefore considers that all export sales made by Vina One to its
Australian customers during the period were ‘arms length’ transactions.
In respect of Australian sales of the goods by Vina One, the Commission has determined
an export price under section 269TAB(1)(a), being the price paid by the importer to the
exporter, less transport and other costs after exportation.
Normal value
The Commission did not find any evidence of related party transactions related to Vina
One’s domestic sales.
In respect of Vina One’s domestic sales of like goods to its unrelated customers during
price; or
or
The Commission therefore considers that all domestic sales made by Vina One to its
domestic customers during the period were ‘arms length’ transactions.
The application claimed that the market in the country of export is such that sales in that
market are not suitable for use in determining a normal value under section 269TAC(1),
and that a market situation applies in accordance with section 269TAC(2)(a)(ii). The
application also claimed that Vina One’s records do not reasonably reflect competitive
market costs associated with the production or manufacture of like goods.
Since the publication of Vina One’s verification report, the Commission determined that a
particular market situation did not exist in respect of the domestic market for precision
pipe and tube steel in Vietnam for the investigation period. The Commission therefore
considers it appropriate to calculate a normal value for Vina One under section
269TAC(1), as the price paid or payable for like goods sold in the ordinary course of trade
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for consumption in the country of export in sales that are ‘arms length’ transactions. As
normal value was calculated under section 269TAC(1), the Commission did not further
consider whether Vina One’s records reasonably reflect competitive market costs.118
The Commission assessed the total volume of relevant sales of like goods as a
percentage of the goods exported to Australia and found that the volume of sales was not
less than 5%.
P-G-3-N-3-R-N-2-A-1-P Volume of domestic sales P-G-3-N-3-R-N-3-A-1-P has been used as it

model is less than 5% of the is the next most comparable model. Domestic
exported volume. sales of this model are greater than 5% of the
exported volume.

exported volume.

exported volume.
Table 16 - Surrogate export model - Vina One
Adjustments

adjustments to be necessary to ensure a fair comparison of normal value and export
prices.

Domestic inland transport Deduct an amount for domestic inland transport
Export handling and other Add an amount for export handling and other
118 See chapter 6.5.1 for further discussion.
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Table 17 : Summary of adjustments - Vina One
Dumping margin
The dumping margin in respect of the goods exported to Australia by Vina One for the
6.10.3 Uncooperative exporters – Vietnam
Vietnam are uncooperative exporters for the purposes of this investigation, other than:
 CDI;
 Vina One;
 Hoa Phat Steel (residual exporter);
 Hoa Phat Long An (residual exporter); and
 Nguyen Minh Steel (residual exporter).
Export prices
information.
The Commission has used the lowest verified weighted average FOB export price for the
investigation period of cooperating Vietnamese exporters who exported to Australia
during the investigation period.
The Commission has chosen the lowest verified export price on the basis that the lowest
weighted average export price demonstrates a price at which an uncooperative exporter
may export like goods to Australia, based on the information before the Commission.
Normal value
relevant information. Specifically, the Commission has used the highest verified normal
value for the investigation period of cooperating Vietnamese exporters who exported to
Australia during the investigation period, less favourable adjustments. This was chosen
on the basis that:
 the highest normal value of cooperating exporters, less favourable adjustments,
demonstrates a price at which an uncooperative exporter may sell the goods in the
domestic Vietnamese market, based on the information before the Commission.
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Dumping margin

Vietnamese exporters for the investigation period is negative 6.5%.
6.10.4 Residual exporters – Vietnam
Hoa Phat Steel, Hoa Phat Long An and Nguyen Minh Steel were selected as residual
exporters from Vietnam.
As the Commission has calculated a negative dumping margin for all exporters, including
uncooperative exporters from Vietnam, and intends to terminate the investigation against
these exporters, it has not calculated a separate dumping margin for residual exporters
and has instead set the dumping margin for residual exporters at the same rate as for
uncooperative exporters.
Dumping margin
The dumping margin in respect of the goods exported to Australia by residual Vietnamese
exporters for the investigation period is negative 6.5%.
The Commission has assessed that the goods exported to Australia from Vietnam by all
exporters were not dumped.
Section 269TDA(1)(b)(i) provides that the Commissioner must terminate a dumping

been no dumping by the exporter of any of those goods.
The Commission is satisfied that there has been no dumping of the goods during the
investigation period by CDI, Vina One, Vietnamese residual exporters or Vietnamese
uncooperative exporters. Accordingly, the Commissioner proposes to terminate the
dumping investigation as it relates to all Vietnamese exporters, pursuant to section
269TDA(1)(b)(i).
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7 SUBSIDY INVESTIGATION
7.1.1 China
The Commission has found that countervailable subsidies were received in respect of the
goods exported to Australia from China during the investigation period.
The Commission has found that the volume of subsidised goods exported to Australia
from China during the investigation period was not negligible.
The subsidy margin determined by the Commission in respect of Dalian Steelforce is

9%.The subsidy margin for non-cooperative entities is 51.6%.
7.1.2 Vietnam
The Commission has found that:
 no countervailable subsidies have been received in respect of the goods exported

to Australia from Vietnam during the investigation period by CDI, Vina One and
residual exporters; and
 countervailable subsidies have been received in respect of the goods exported to
Australia from Vietnam non-cooperative entities during the investigation period,
albeit at negligible levels.
The Commission has found that the volume of subsidised goods exported to Australia
from Vietnam by non-cooperative entities during the investigation period was not
negligible.
The subsidy margin determined by the Commission in respect of non-cooperative

exporters is negligible.
Accordingly, the Commissioner is satisfied that:
 it is necessary to terminate the subsidy investigation under section 269TDA(2)(b)(i)

in respect of the cooperating exporters, CDI and Vina One and the residual
exporters; and
 it is necessary to terminate the subsidy investigation under section
269TDA(2)(b)(ii) in respect non-cooperative entities.
7.2 Relevant legislation

7.2.1 Countervailable subsidies
Section 269T(1) defines ‘subsidy’ as follows:

subsidy, in respect of goods exported to Australia, means:
(a) a financial contribution:
(i) by a government of the country of export or country of origin of the goods; or
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(ii) by a public body of that country or a public body of which that government is a member;
or
(iii) by a private body entrusted or directed by that government or public body to carry out a
governmental function;
that involves:
(iv) a direct transfer of funds from that government or body; or

(v) the acceptance of liabilities, whether actual or potential, by that government or body; or
(vi) the forgoing, or non-collection, of revenue (other than an allowable exemption or
remission) due to that government or body; or
(vii) the provision by that government or body of goods or services otherwise than in the
course of providing normal infrastructure; or
(viii) the purchase by that government or body of goods or services; or
(b) any form of income or price support as referred to in Article XVI of the General Agreement on
Tariffs and Trade 1994 that is received from such a government or body;
if that financial contribution or income or price support confers a benefit (whether directly or indirectly)
in relation to the goods exported to Australia.119
Section 269TAAC defines a ‘countervailable subsidy’ as follows:

(1) For the purposes of this Part, a subsidy is a countervailable subsidy if it is specific.
(2) Without limiting the generality of the circumstances in which a subsidy is specific, a subsidy is
specific:
(a) if, subject to subsection (3), access to the subsidy is explicitly limited to particular
enterprises; or
(b) if, subject to subsection (3), access is limited to particular enterprises carrying on
business within a designated geographical region that is within the jurisdiction of the
subsidising authority; or
(c) if the subsidy is contingent, in fact or in law, and whether solely or as one of several
conditions, on export performance; or
(d) if the subsidy is contingent, whether solely or as one of several conditions, on the use of
domestically produced or manufactured goods in preference to imported goods.
(3) Subject to subsection (4), a subsidy is not specific if:
(a) eligibility for, and the amount of, the subsidy are established by objective criteria or
conditions set out in primary or subordinate legislation or other official documents that
are capable of verification; and
(b) eligibility for the subsidy is automatic; and
(c) those criteria or conditions are neutral, do not favour particular enterprises over others,
are economic in nature and are horizontal in application; and
(d) those criteria or conditions are strictly adhered to in the administration of the subsidy.
119 Section 269TACC sets out the steps for working out whether a financial contribution or income or price support
confers a benefit.
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(4) The Minister may, having regard to:
(a) the fact that the subsidy program benefits a limited number of particular enterprises; or
(b) the fact that the subsidy program predominantly benefits particular enterprises; or
(c) the fact that particular enterprises have access to disproportionately large amounts of
the subsidy; or
(d) the manner in which a discretion to grant access to the subsidy has been exercised;
determine that the subsidy is specific.
(5) In making a determination under subsection (4), the Minister must take account of:
(a) the extent of diversification of economic activities within the jurisdiction of the subsidising
authority; and
(b) the length of time during which the subsidy program has been in operation.
Section 269TACD provides that if the Minister is satisfied that a countervailable subsidy
has been received in respect of the goods, the Minister must, if the amount of the subsidy
is not quantified by reference to a unit of the goods, work out how much of the subsidy is
properly attributable to each unit of the goods.
7.2.2 Non-cooperative entities
Section 269TAACA(1) provides that, when determining whether a countervailable subsidy

has been received in respect of particular goods, or when determining the amount of a
countervailable subsidy in respect of particular goods, the Commissioner may act on the
basis of all the facts available and may make such assumptions as the Commissioner
considers reasonable. In particular, in circumstances where an entity:120
 has not given the Commissioner information the Commissioner considers to be

relevant to the investigation, review or inquiry within a period the Commissioner
considers to be reasonable; or
 has significantly impeded the investigation, review or inquiry.
Such entities are referred to in this report as “non-cooperative entities”.
7.3 Investigated programs

7.3.1 China
The applicant alleged the existence of a total of 45 programs in relation to exports of

precision pipe and tube steel from China, based on previous findings made by the
Commission in respect of subsidies received for other products manufactured in China
from HRC, namely HSS. The applicant argued that such subsidies would be applicable to
the goods. Like HSS, precision pipe and tube is manufactured from HRC. Both HSS and
HRC have been the subject of previous findings in relation to countervailable subsidies
120 Entities contemplated by section 269TAACA(1) are also described in section 269TAACA(2).
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from China. Accordingly, the applicant considers that the goods from China would be
expected to be in receipt of the same benefits.
In respect of subsidies for HRC, the Manual provides that:
“Upstream” subsidy refers to a subsidy (non-export) paid to an input product such

as raw material or a manufactured product used in the production of the goods in
question, and countervailing action may be taken where the benefit received by the
upstream recipient of the subsidy passed through, in whole or in part, to the
downstream purchaser.
Where it is established that the price of the input product reflects the benefit of the
subsidy, in whole or in part, received by the upstream supplier, then the
downstream purchaser is taken to have received a subsidy.121
Consistent with the statement above, the Commission is satisfied that subsidies for HRC
may be applicable to the goods, with such subsidies being “upstream subsidies”.
After considering the information before the Commission regarding the identified
subsidies, the Commission is also satisfied that the subsidies may also be applicable to
the goods, as HSS and the goods are used in similar industries.
The Commission has investigated each of the 45 alleged subsidy programs.
The Commission has set out each program investigated in respect of exports of the
goods from China and its finding in respect of each program in the table below.
Program Program name Program Countervailable

Number122 Type subsidy
received?
(Yes/No)
Programs included in questionnaires
Preferential Tax Policies for Enterprises with Foreign
Investment Established in the Coastal Economic Open
1 Tax Yes
Areas and Economic and Technological Development
Zones
One-time Awards to Enterprises Whose Products
2 Qualify for ‘Well-Known Trademarks of China’ and Grant Yes
‘Famous Brands of China’
Matching Funds for International Market Development
5 Grant Yes
for Small and Medium Enterprises
6 Superstar Enterprise Grant Grant Yes
7 Research & Development (R&D) Assistance Grant Grant Yes
8 Patent Award of Guangdong Province Grant Yes
121 The Manual, chapter 19.

122 The Commission has maintained the Program Number used in the application.
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received?
(Yes/No)
Preferential Tax Policies for Foreign Invested
Enterprises– Reduced Tax Rate for Productive Foreign
10 Tax Yes
Invested Enterprises scheduled to operate for a period
of not less than 10 years
11 Investment Established in Special Economic Zones Tax Yes
(excluding Shanghai Pudong area)
12 Tax Yes
Investment Established in Pudong area of Shanghai
13 Preferential Tax Policies in the Western Regions Tax Yes
Tariff and VAT Exemptions on Imported Materials and
14 Tax Yes
Equipment
15 Innovative Experimental Enterprise Grant Grant Yes
16 Special Support Fund for Non State-Owned Enterprises Grant Yes
17 Venture Investment Fund of Hi-Tech Industry Grant Yes
Grants for Encouraging the Establishment of
18 Headquarters and Regional Headquarters with Foreign Grant Yes
Investment
Grant for key enterprises in equipment manufacturing
19 Grant Yes
industry of Zhongshan
Less than
Hot rolled steel provided by government at less than fair
20 adequate Yes
market value
remuneration
21 Water Conservancy Fund Deduction Grant Yes
22 Wuxing District Freight Assistance Grant Yes
23 Huzhou City Public Listing Grant Grant Yes
27 Huzhou City Quality Award Grant Yes
Huzhou Industry Enterprise Transformation & Upgrade
28 Grant Yes
Development Fund
29 Land Use Tax Deduction Tax Yes
30 Wuxing District Public Listing Grant Grant Yes
31 Anti-dumping Respondent Assistance Grant No
32 Technology Project Assistance Grant Yes
34 Balidian Town Public Listing Award Grant Yes
Preferential Tax Policies for High and New Technology
35 Tax Yes
Enterprises
36 Local Tax Bureau Refund Tax Yes
37 Return of Farmland Use Tax Tax Yes
38 Return of Land Transfer Fee Tax Yes
39 Return of Land Transfer Fee From Shiyou Tax Yes
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received?
(Yes/No)
Dining lampblack governance subsidy of Jinghai County
40 Grant Yes
Environmental Protection Bureau
41 Discount interest fund for technological innovation Grant Yes
Energy conservation and emission reduction special
42 Grant Yes
fund project in 2015
Enterprise famous brand reward of Fengnan Finance
43 Grant Yes
Bureau
44 Government subsidy for construction Grant Yes
Infrastructure Construction Costs Of Road In Front Of
45 Grant Yes
No.5 Factory
New Type Entrepreneur Cultivation Engineering
46 Training Fee Of Jinghai County Science And Grant Yes
Technology Commission
47 Subsidy for Coal-Fired Boiler of Fengnan Subtreasury Grant Yes
48 Subsidy for Coal-Fired Boiler Rectification Grant Yes
49 Subsidy for District Level Technological Project Grant Yes
Subsidy For Pollution Control Of Fengnan
50 Grant Yes
Subsidy from Science and Technology Bureau of
51 Grant Yes
Jinghai County
52 Subsidy of Environment Bureau transferred from Shiyou Grant Yes
550-2 Loan Interest Subsidy Grant Yes
Table 18 Investigated subsidy programs – China
The Commission’s findings in relation to each program investigated are outlined in

Non-confidential Appendix C2.
7.3.2 Vietnam
The applicant alleged the existence of a total of 44 unique programs in relation to exports
of precision pipe and tube steel from Vietnam, based on the findings of anti-dumping and
countervailing cases conducted by the CBSA in relation to the provision of subsidies
granted by the GOV, as well as Vietnam’s notifications in March 2013 and September
2015 to the World Trade Organization (WTO) Committee on Subsidies and Countervailing
Measures pursuant to Article XVI:1 of the GATT 1994 and Article 25 of the WTO
Agreement on Subsidies and Countervailing Measures.
The Commission has investigated each of the 44 alleged subsidy programs.
The Commission has set out each program investigated in respect of exports of the
goods from Vietnam and its finding in respect of each program in the table below.
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received?
(Yes/No)
Programs included in questionnaires
Preferential Import Tariff Rates contingent upon No
Localisation Ratios with respect to products and Parts
1 of Mechanical-Electric-Electronic Industries (updating Tariff policy
Programme II of Notification of Subsidies period 2003-
2004)
Support for the Implementation of Projects No
Financial
2 Manufacturing Priority Industrial Products (Updating
grant
Programme III of 2003-2004)
Investment Incentives Contingent upon Export No
Financial
3 Performance For Domestic Businesses (Updating
grant
Programme IV of 2003-2004)
Other Investment Incentives for Domestic Businesses Financial No
4
(Updating Program V of Period 2003-2004) grant
Investment Incentives Contingent upon Export No
Financial
5 Performance for Foreign Invested Enterprises
grant
(Updating Programme VI of the Period 2003-2004)
Other Investment Incentives for Foreign Invested Financial No
6 Enterprises (Updating Programme VII for Period 2003- grant
2004)
Preferential Investment Credit for Development Financial No
7 Contingent upon Export Criteria (Updating Programme grant
VIII of Period 2003-2004)
Preferential Development Credit for Investment Financial No
8 Contingent Upon Localisation Ratios (Updating grant
Programme IX of Period 2003-2004)
Other Preferential Investment Credit for Development Financial No
9 (Updating Program X of Period 2003-2004) grant
Export Promotion Financial No

10 grant
Trade Promotion (Updating of Programme XIII of Financial No

11 Period 2003-2004) grant
Support for Mechanical Products (Updating Program Financial No

12 XV of Period2003-2004) grant
Support for Shipbuilding Industry (Updating of Financial No

13 Programme XV of Period 2003-2004) grant
Assistance for Commercial Development in Financial No

14 Mountainous, Island and Ethnic Minority Areas grant
(Updating Programme XVI of Period 2003-2004)
123 The Commission has maintained the Program Number used in the application.
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received?
(Yes/No)
Assistance to Enterprises Facing Difficulties due to Financial No
15 Objective Reasons grant
Incentives for Investment Projects in Science and Financial No

16 Technology (Updating Programme XVIII of Period grant
2003-2004)
Preferential Import Tariff Rates for enterprises investing No
17 Tariff policy
in regions or sectors entitled to investment incentives
Incentives on corporate income tax for enterprises Yes
18 Tax benefit
operating in regions or sectors entitled to incentives
19 Incentives on non-agricultural land use Tax benefit No
Grants to Firms that Employ more than 50 Employees Financial No
20
grant
Investment Support (consisting of two separate Covered under
21 Tax benefit
programs) Program 18
Acquisition of State Assets at Less Than Fair Market No
22 LTAR
Value
Export & Import Support in the Form of Preferential No
Preferential
23 Loans, Guarantees, and Factoring (consisting of five
loan/interest
separate programs)
Export Support Loans at Preferential Rates Preferential No
24
loan/interest
Interest Rate Support Program under the State Bank of Preferential No
25
Vietnam loan/interest
Preferential Lending under the Viet Bank Export Loan Preferential Covered under
26
Program loan/interest Program 24
27 Accelerated Depreciation of Fixed Assets Tax benefit No
28 Additional Income Tax Preferences for Exporters Tax benefit No
Enterprise Income Tax Exemption/Reduction for Covered under
29 Tax benefit
Business Expansion and Intensive Investment Projects Program 18
Enterprise Income Tax Preferences, Exemptions, and No
30 Tax benefit
Reductions (consisting of seven separate programs)
Establishments Dealing with Exported Goods Covered under
31 Tax benefit
Program 28
Exemption of Import Tax on Equipment and Machinery Covered under
32 Tax benefit
Imported to Create Fixed Assets Program 17
Exemptions/reductions of Land Rent, Tax, and Levies No
33 Tax benefit
(consisting of five separate programs)
34 Land-Use Levy Exemptions/Reductions Tax benefit No
Preferential Income Tax Rates for Enterprises within Covered under
35 Tax benefit
Economic Zones or Industrial Parks Program 18
36 Preferential Provisions for Carry-forward of Losses Tax benefit No
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received?
(Yes/No)
Tax Exemptions and Reductions for Encouraged Covered under
37 Tax benefit
Sectors Program 18
Tax Exemptions and Reductions for Foreign-Invested No
38 Tax benefit
Enterprises
Tax Exemptions and Reductions for Investment in Covered under
39 Tax benefit
Disadvantaged Regions Program 18
Tax Exemptions and Reductions for Investments in Covered under
40 Tax benefit
Economic Zones or High-Tech Industrial Parks Program 18
Tax Preferences for Investors Producing and/or Dealing Covered under
41 Tax benefit
in Export Goods Program 28
Excessive Duty Exemptions for Imported Raw Materials No
42 Tariff policy
for Exported Goods
Exemptions of Import Duty (consisting of seven No
43 Tariff policy
separate programs)
44 Refund of Import Duty Tariff policy No
Table 19 Investigated subsidy programs – Vietnam
The Commission’s findings in relation to each program investigated are outlined in

7.4 Information considered by the Commission

7.4.1 Information provided by exporters
The Commission has relied upon information provided by cooperating exporters when
assessing the alleged subsidy programs for both China and Vietnam. This included
information provided by exporters in the REQs as well as information provided by
exporters during verification.
7.4.2 Information provided by the Government of China
In accordance with section 269TB(2C), the Commission invited the GOC for consultations
during the consideration phase of the investigation concerning the claims made by the
applicant in relation to countervailable subsidies.
On 31 March 2020, the Commission also sent a Government Questionnaire to the GOC,
which included questions relating to each of the alleged subsidy programs identified in the
application.
No response was received from the GOC to either communication.
Notwithstanding the above, the GOC did provide a questionnaire response to the
Commission in respect of a separate investigation, Investigation 553 – Painted Steel
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Strapping124 initiated shortly after this investigation. It was alleged in Investigation 553
that Chinese exporters of painted steel strapping, also manufactured from HRC, were in
receipt of the same countervailable subsidies as alleged were received by Chinese
exporters of precision pipe and tube steel. Due to the similarities in the subsidy
allegations and the raw material inputs in the two cases, the Commission has had regard
to the response by the GOC to Investigation 553 in its consideration of this investigation,
pursuant to section 269TDAA(2)(b).
7.4.3 Information provided by the Government of Vietnam
The Commission also invited the GOV for consultations on the claims made by the
applicant in relation to countervailable subsidies. On 24 March 2020, the GOV advised
the Commission that its submission dated 20 January 2020 in relation to a similar
investigation (which was withdrawn by the applicant) could also be considered by the
Commission for the purposes of Investigation 550.125
On 31 March 2020, the Commission sent a Government Questionnaire to the GOV, which
included questions relating to each of the alleged subsidy programs identified in the
application. A response to the questionnaire was provided by the GOV to the Commission
on 10 June 2020.126
7.4.4 Other information considered as part of this assessment
The Commission also considered as part of this assessment:
 information provided in the application;

 submissions received in relation to subsidies provided to Chinese and Vietnamese
exporters;127
 information provided to the WTO by the GOC in July 2019 and by the GOV in
February 2020 in their respective notifications in the New and Full Notification
Pursuant to Article XVI:1 of the GATT 1994 and Article 25 of the Agreement on
Subsidies and Countervailing Measures (SCM Agreement);128 and
 previous investigations by the Commission into subsidies provided to Chinese
exporters.
124 EPR 553, Item 10.

125 EPR 550, Item 4.
126 EPR 550, Item 38.
127 EPR 550, Item 4 – GOV submission in response to application; EPR 550, Item 38 – GOV submission
regarding particular market situation and countervailable subsidies and EPR 550, Item 39 – Orrcon
submission regarding Chinese and Vietnamese particular market situation.
128 Both are available on the WTO website at: https://www.wto.org/english/tratop_e/scm_e/scm_e.htm
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7.5 Subsidy Assessment – China

7.5.1 Dalian Steelforce
7.5.1.1 Program 550-2 – Loan Interest Subsidy
During verification, it was found Dalian Steelforce had received a subsidy under this
program. The Commission has further examined this program and determined this
program is specific, as it is available only to entities located in the Dalian region. See
The amount received under this program has been attributed to all of the company’s
sales. It was then allocated to the goods based on the export revenue over the
7.5.1.2 Program 20 - Hot rolled steel provided by government at less than fair market
value
The Commission is satisfied that Chinese manufacturers of the goods will have received
a subsidy under this program. The Commission considers this program is specific, as it is
only available to purchases of HRC and other coil types derived from HRC. See
The amount received under this program has been attributed to all of the company’s
sales. It was then allocated to the goods based on the export revenue over the
7.5.1.3 Subsidy margin
Based on the information available to the Commission, the Commission has calculated a
subsidy margin for Dalian Steelforce of 9.0%. See Confidential Attachment 34.
7.5.2 Non-cooperative Chinese entities
The subsidy margin for non-cooperative entities is determined, pursuant to section

269TAACA, on the basis of all facts available and having regard to reasonable
assumptions.
When determining the countervailable subsidies for non-cooperative entities, the

Commissioner has made reasonable assumptions, so as to determine whether a
countervailable subsidy has been received in respect of the goods and the amount of the
countervailable subsidy.
The Commission has assumed that non-cooperative entities benefited from non-regional
countervailable subsidies and the highest region-specific subsidy. The Commission
considers that this approach avoids the potential for double-count of similar programs
between regions.
The subsidy margin for each program is the higher of:
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 the margins applicable to each program based on previous findings made by the
Commission in respect of subsidies received for other products manufactured in
China from HRC, consistent with the approach taken in the application129; and
 the margins calculated for the cooperating exporter as part of this investigation.
The subsidy margins for each program were summed to obtain the total subsidy margin.
subsidy margin for non-cooperative entities of 51.6%.
The Commission’s countervailable subsidy calculations are contained in

Confidential Attachment 28.130
7.6 Subsidy assessment – Vietnam

7.6.1 Chinh Dai Industrial
7.6.1.1 Program 43 – Exemptions of Import Duty131
During verification, it was found CDI had received a subsidy under this program. The
Commission has further examined this program and determined that no subsidy was
provided. The findings in relation to this program are discussed in
Based on the information available to the Commission, the Commission has not found
CDI to be receipt of any countervailable subsidies. See Confidential Attachment 35.
7.6.2 Vina One Steel Manufacturing
The Commission has found no evidence that Vina One received a subsidy in relation to
any of the alleged programs.
Based on the information available to the Commission, the Commission has not found
Vina One to be receipt of any countervailable subsidies. See Confidential Attachment
36.
129 Review 419 – Hollow structural sections from China, Korea, Malaysia, Taiwan and Review 529 - Hollow
structural sections from China, Korea, Malaysia, Taiwan, Thailand.
130 This attachment has been kept confidential as it contains commercially sensitive information relating to
exporters.
131 Due to similarities with other programs, this subsidy may be alternatively classed under
Program 42 or 44.
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7.6.3 Residual exporters
The Commission has determined that the residual exporters will receive benefits by
having regard to the examination of the selected cooperative exporters. As the selected
cooperative exporters for Vietnam were found not to be in receipt of any countervailable
subsidies, the Commission has determined that residual exporters have also not received
any countervailable subsidies in respect of the goods during the investigation period.
7.6.4 Non-cooperative Vietnamese entities
As discussed in chapter 7.5.2, the subsidy margin for non-cooperative entities is

determined on the basis of all facts available and based on reasonable assumptions.
7.6.4.1 Program 18 – Incentives on corporate income tax for enterprises operating in

regions or sectors entitled to incentives
The Commission has determined that non-cooperative entities may be in receipt of a

benefit under this program and that this program is countervailable.
As discussed in Non-confidential Appendix C3, the Commission has found the lowest
preferential tax rate that eligible entities may receive is 10%. The Commission considers
that non-cooperative entities in Vietnam may have received the most favourable
preferential rate of 10% during the investigation period.
Accordingly, in working out the benefit received during the investigation period, the
Commission has determined the benefit received by non-cooperative entities under this
program by applying a preferential rate of 10% to the weighted average verified taxable
income of the cooperating exporters for the investigation period.
The amount received under this program has been attributed to a weighted average of all
of the cooperating exporters’ sales. It was then allocated to the goods based on the
weighted average of the cooperating exporters’ export revenue over the investigation
period.
The subsidy margin for non-cooperative entities has then been calculated using the
amount of the unit benefit expressed as a percentage of the lowest verified weighted
average FOB export price for the investigation period of cooperating Vietnamese
exporters who exported to Australia during the investigation period.
The Commission has chosen the lowest verified export price on the basis that the lowest
weighted average export price demonstrates a price at which a non-cooperative entity
may export like goods to Australia, based on the information before the Commission.
subsidy margin for non-cooperative entities of 0.01%.
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The Commission’s countervailable subsidy calculations for non-cooperative entities is

contained in Confidential Attachment 28.132
7.7 Summary of subsidy margins

The table below summarises what programs have been found countervailable and the
corresponding subsidy margins for each exporter.
132This attachment has been kept confidential as it contains commercially sensitive information relating to
exporters.
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Exporter Programs Subsidy margin

China
Dalian Steelforce Program 550-2 – Loan Interest Subsidy 9.0%
Program 20 – Hot rolled steel provided by government at
less than fair market value
Non-cooperative Program 550-2 – Loan Interest Subsidy 51.6%
entities Program 1 – Preferential Tax Policies for Enterprises
with Foreign Investment Established in the Coastal
Economic Open Areas and Economic and Technological
Development Zones
Program 2 – One-time Awards to Enterprises Whose
Products Qualify for ‘Well-Known Trademarks of China’
and ‘Famous Brands of China’
Program 5 – Matching Funds for International Market
Development for Small and Medium Enterprises
Program 6 – Superstar Enterprise Grant
Program 7 – Research & Development (R&D)
Assistance Grant
Program 8 – Patent Award of Guangdong Province
Program 10 – Preferential Tax Policies for Foreign
Invested Enterprises– Reduced Tax Rate for Productive
Foreign Invested Enterprises scheduled to operate for a
period of not less than 10 years
Program 14 – Tariff and VAT Exemptions on Imported
Materials and Equipments
Program 15 – Innovative Experimental Enterprise Grant
Program 16 – Special Support Fund for Non State-
Owned Enterprises
Program 17 – Venture Investment Fund of Hi-Tech
Industry
Program 18 – Grants for Encouraging the Establishment
of Headquarters and Regional Headquarters with
Foreign Investment
Program 19 – Grant for key enterprises in equipment
manufacturing industry of Zhongshan
Program 20 – Hot rolled steel provided by government at
less than fair market value
Program 21 – Water Conservancy Fund Deduction
Program 29 – Land Use Tax Deduction
Program 32 – Technology Project Assistance
Program 35 – Preferential Tax Policies for High and New
Technology Enterprises
Program 36 – Local Tax Bureau Refund
Program 37 – Return of Farmland Use Tax
Program 38 – Return of Land Transfer Fee
Program 39 – Return of Land Transfer Fee From Shiyou
Program 41 – Discount interest fund for technological
innovation
Program 42 – Energy conservation and emission
reduction special fund project in 2015
Program 44 – Government subsidy for construction
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Program 45 – Infrastructure Construction Costs Of Road

In Front Of No.5 Factory
Program 48 – Subsidy for Coal-Fired Boiler Rectification
Program 49 – Subsidy for District Level Technological
Program 50 – Subsidy For Pollution Control Of Fengnan
Program 51 - Subsidy from Science and Technology
Bureau of Jinghai County
Program 52 – Subsidy of Environment Bureau
transferred from Shiyou
Vietnam
CDI None N/A
Vina One None N/A
Residual exporters None N/A
Non-cooperative Program 18 – Incentives on corporate income tax for 0.1%
entities enterprises operating in regions or sectors entitled to
incentives
Table 20 - Countervailable subsidies and subsidy margins received by exporters
7.8 Volume of subsidised imports

Section 269TDA(7) provides that the Commissioner must terminate a countervailing
investigation, in so far as it relates to a country, if satisfied that the total volume of goods
that has been, or may have been, exported to Australia during a reasonable examination
period and in respect of which a countervailable subsidy has been, or may be, received,
is negligible.
Pursuant to section 269TDA(8), a negligible volume for both China and Vietnam is a
volume less than 4% of the total volume of goods imported into Australia over a
reasonable examination period.133
Using the ABF import database and having regard to the information collected and
verified from the importers and exporters, the Commission determined the volume of
goods exported to Australia from China and Vietnam during the investigation period.
Based on this information, the Commission is satisfied that, when expressed as a
percentage of the total Australian import volume of the goods and excluding Vietnamese
cooperating entities, which were found not to have imported subsidised goods, the
volume of subsidised goods from both China and Vietnam was greater than 4% of the
total Australian import volume and is therefore not negligible.134
Accordingly, the Commissioner does not propose to terminate the subsidy investigation
under section 269TDA(7).
133 China and Vietnam are classed as Developing Countries under Part 4, Division 1 of the Customs Tariff
Regulations 2004.
134 Confidential Attachment – All other entities subsidy analysis, worksheet “All other entity import volume”.
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7.9 Level of subsidisation

Section 269TDA(2) provides that the Commissioner must terminate a countervailing
investigation, in so far as it relates to an exporter of the goods, if satisfied either that no
countervailable subsidy was received in respect of the goods, or if a subsidy was
received, the level of the subsidy did not at any time during the investigation period
exceed a negligible level.
Pursuant to section 269TDA(16)(b), a countervailable subsidy received in respect of

goods exported to Australia from both China and Vietnam is negligible if, when expressed
as a percentage of the export price of the goods, the level of the subsidy is not more than
2%.135
7.9.1 China
Based on its investigation into countervailable subsidies provided to Chinese exporters of

the goods to Australia, the Commission is satisfied that the total level of countervailable
subsidies, when expressed as a percentage of the export price of the goods:
 for Dalian Steelforce, exceeded 2% throughout the investigation period; and

 for non-cooperative Chinese entities, exceeded 2% throughout the investigation
period.
Accordingly, the Commissioner is satisfied that:
 a countervailable subsidy has been received by Dalian Steelforce in respect of the

goods exported to Australia, at a margin of 9.0%; and
 a countervailable subsidy has been received by non-cooperative Chinese entities
in respect of the goods exported to Australia, at a margin of 51.6%.
7.9.2 Vietnam
Based on its investigation into countervailable subsidies provided to Vietnamese

exporters of the goods to Australia, the Commission is satisfied that the total level of
countervailable subsidies, when expressed as a percentage of the export price of the
goods never, at any time during the investigation period, exceeded 2% for either CDI,
Vina One, residual exporters or non-cooperative entities and is therefore negligible for
those exporters.
Accordingly, the Commissioner is satisfied it is necessary to terminate the countervailable

subsidy investigation under section 269TDA(2) in respect of all Vietnamese exporters.
135China and Vietnam are classed as Developing Countries under Part 4, Division 1 of the Customs Tariff
Regulations 2004.
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8 ECONOMIC CONDITION OF THE INDUSTRY

The Commissioner is preliminarily satisfied that the Australian industry has experienced
injury in the forms of:
 reduced sales volume;

 price depression;
 price suppression;
 reduced profit
 reduced profitability;
 reduced revenue;
 reduced employment numbers;
 reduced return on investment (ROI); and
 reduced inventory turnover.
8.2 Approach to injury analysis

The Commission considers that the Australian industry is comprised solely of Orrcon.
The injury analysis detailed in this chapter is therefore based on verified financial
information submitted by Orrcon.
The injury analysis period being considered for the purpose of this investigation is from
1 January 2016.
The data supporting the Commission’s analysis of the Australian market and the
economic condition of the Australian industry is at Confidential Attachments 2 and 29.
8.2.1 Submission concerning approach to injury analysis
In its submission dated 20 January 2020,136 TRAV raised concerns that based on the
non–confidential version of the application, the requirements of Articles 15.1, 15.2 and
15.4 of the SCM Agreement as it pertains to injury have not been met. TRAV’s claims
specifically relate to the volume of subsidised imports, their impact on prices in the
domestic market and the evaluation of other relevant economic factors.
In assessing injury to the Australian industry, the Commission relied on the requirements
set out in section 269TAE and sections 269TG and 269TJ, the Ministerial Direction on
Material Injury 2012 (Material Injury Direction) and the Manual.
The Commission was also provided with confidential attachments to the application that
formed the basis for the assessment of injury to the Australian industry as set out in the
following sections. To the extent required, this confidential information is addressed in the
confidential attachments to this report. Assessments of injury factors are contained within
136 EPR 550, document number 4.
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this chapter and the impacts of dumped and subsidised imports on the domestic industry
is in Chapter 9.
8.3 Volume effects

8.3.1 Sales volume
Figure 7 – Orrcon sales volumes
Orrcon’s sales volumes have fluctuated over the injury analysis period, however, Orrcon’s
sales volumes reduced in the investigation period. In the application, Orrcon claimed that
while it has seen some increases of volumes during the period, in a growing market it
should have seen a greater increase. Therefore, it claimed injury in the form of reduced
sales volumes. The Commission assessed the growth of the market during the period and
found that total market volumes contracted during the period after an initial increase
between 2016 and 2017.
Figure 8 – Total market volumes
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8.3.2 Market share
Figure 9 – Market shares137
The Commission analysed changes in market share during the injury analysis period.138
After an initial increase in market share between 2016 and 2017, the market share of
China and Korea reduced between 2017 and 2018 and largely remained unchanged
between 2018 and 2019. Orrcon’s market share increased between 2017 and 2019.
8.3.3 Conclusion – volume effects
While Orrcon increased its market share from 2017, it experienced a reduction in sales
volumes in the investigation period. The Commission is satisfied that Orrcon experienced
injury in the form of reduced sales volumes during the injury analysis period.
8.4 Price effects

8.4.1 Price suppression and price depression
Price depression occurs when a company, for some reason, lowers its prices. Price
suppression occurs when price increases, which otherwise might have occurred, have
been prevented. An indicator of price suppression may be the margin between prices and
costs.
137 The market shares of Taiwanese and Vietnamese exports have been included in the share of non-subject
countries as a result of the Commission’s proposed termination of the investigation in relation to all Taiwanese
and Vietnamese exporters as discussed in sections 6.9, 6.10 and 7.6.
138 Confidential Attachment 29 – Australian market analysis – injury analysis.
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Figure 10 – Unit CTMS and unit selling price
The figure above depicts a downward movement in unit pricing since 2017. There is a
minor recovery between 2018 and 2019. Unit CTMS has seen a steady increase since
2017, however, prices have not kept up with the unit CTMS increase resulting in a
reduction in Orrcon’s profit margin.
8.4.2 Conclusion – price effects
The Commission is satisfied that Orrcon experienced injury in the form of price
depression and price suppression during the injury analysis period.
8.5 Profit and profitability
Figure 11 – Profits and profitability
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The figure above shows a reduction in profits and profitability between 2016 and 2018.
Between 2018 and 2019, there was minimal change in Orrcon’s net loss and profitability
position.
8.5.1 Conclusion – profit and profitability
The Commission is satisfied that Orrcon experienced injury in the form of reduced profits
and profitability during the injury analysis period.
8.6 Other economic factors

8.6.1 Revenue
Figure 12 - Revenue
Orrcon has experienced revenue growth between 2017 and 2018, followed by a decrease
in the investigation period.
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8.6.2 Employment numbers
Figure 13 – Employment numbers
Orrcon’s employee numbers reduced between 2018 and 2019.
8.6.3 Return on investment
Figure 14 – Return on investment
Orrcon’s ROI for like goods has reduced between 2017 and 2019, with a significant
reduction between 2017 and 2018.
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8.6.4 Reduced inventory turnover
Figure 15 – Inventory turnover
Orrcon’s inventory turnover has decreased in the investigation period after increasing
8.6.5 Production and capacity utilisation
In its application, Orrcon claimed that its increase in production volumes since the
2015/16 year are “materially insignificant when contrasted with the 60 per cent increase in
the precision pipe and tube market over the same period.” The Commission has analysed
the claim of both the increase in Orrcon’s own production as well as the size of the
market. It is noted that while the initial data provided to the Commission in Orrcon’s
application was for years ending 30 September, updated data has been provided to the
Commission for calendar years 2016 to 2019.
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Figure 16 – Production quantity
The Commission notes that, as stated by Orrcon, there has been an increase in
production of the goods between 2017 and 2018, with a slight reduction in 2019. Orrcon
contrasted this with the increase in the size of the overall market. Accordingly, the
Commission reviewed the size of the market in Australia for precision pipe and tube.
Figure 17 – Australian market for precision pipe (volume, MT)
As demonstrated in figure 11, the Commission found that the market for precision pipe
and tube in Australia reduced between 2017 and 2019.
During the injury analysis period, Orrcon’s capacity utilisation also increased as
demonstrated in Figure 12 below.
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Figure 18 – Capacity utilisation
8.6.6 Other indicators
Assets – Orrcon has seen an increase in assets during the injury analysis period.
Capital investment – Orrcon’s capital investment in relation to like goods increased

between 2017 and 2019, after an initial decrease.
Productivity - Productivity increased between 2017 and 2019, after an initial decrease
Average wages – Average wages trended up during the injury analysis period.
8.6.7 Conclusion – other economic factors
The Commission is satisfied that Orrcon experienced injury in the form of reduced
revenue, employment numbers, ROI and inventory turnover.
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9 HAS DUMPING AND/OR SUBSIDIES CAUSED MATERIAL

INJURY?
9.1 Preliminary assessment
The Commissioner is preliminarily satisfied that dumped exports of the goods from China
and Korea, and subsidised exports of the goods from China, caused material injury to the
Australian industry.
In investigating the cause of injury to the Australian industry the Commissioner had
regard to the economic indicators of the Australian industry, the size of dumping margins,
the volumes and prices of exports from the subject countries, the importance of price in
the industry, and evidence of import prices impacting pricing negotiations in the market.

Under sections 269TG, 269TJ and 269TJA, one of the matters that the Minister must be
satisfied of in order to publish a dumping duty and/or countervailing duty notice is that,
because of dumping and subsidisation, material injury has been, or is being caused, or is
threatened to the Australian industry producing like goods.139
Section 269TAE(1) outlines the factors, to which the Commissioner has had regard, and
that may be taken into account when determining whether material injury to an Australian
industry has been, or is being, caused or threatened.
Section 269TAE(2A) requires that regard be had to the question as to whether any injury
to an industry is being caused by a factor other than the exportation of the goods, and
provides examples of such factors.
In assessing material injury, the Commission also has regard to the Material Injury
Direction.
9.3 Approach to causation analysis

As outlined in Chapter 8, the Commission considers that the Australian industry has
experienced injury and this injury has coincided with the presence of dumped goods from
China and Korea and subsidised goods from China. This chapter will analyse whether
injury to the Australian industry was caused by dumping and subsidisation and whether
that injury is material.
139 Section 269TJA relates to concurrent dumping and countervailable subsidisation. This provision provides
that, where goods are both dumped and subsidised, and because of the combined effects of the dumping
and the amount of countervailable subsidy received in respect of the goods, material injury to an Australian
industry producing like goods has been or is being caused, the Minister may publish a notice under either
sections 269TG(1), 269TG(2), 269TJ(1) or 269TJ(2), or notices under such sections at the same time. Section
269TJA is relevant in this investigation, due to the combined dumping and subsidisation in relation to goods
exported to Australia from China.
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The Commission has, for the purposes of this SEF, assessed injury and causation by
examining the following evidence:
 verified volume, price, and profit effects of the Australian industry during the injury
analysis period and investigation period (refer Chapter 8 above);
 verified sales data from cooperating exporters and importers to determine sales
prices and volumes achieved by the subject exporters from China and Korea;
 dumping margins for the subject countries;
 subsidy margins for China;
 information from the ABF import database to determine import volumes and
export prices;
 examples and related evidence relating to negotiations with customers provided
by Orrcon; and
 the broader context of the economic condition of the Australian industry.
Evidence included in the analysis undertaken by the Commission in this chapter is in

Confidential Attachment 30.
9.4 Size of dumping and subsidy margins

Sections 269TAE(1)(aa) and 269TAE(1)(ab) provide that regard may be given to the size
of each of the dumping and subsidy margins worked out in respect of the goods of that
kind that have been exported to Australia. The dumping and subsidy margins, as detailed
in Table 8 above are reproduced below with the subsidy margins.
Exporter Dumping Margin (%) Subsidy Margin (%)

Dalian Steelforce 2.9 9.0
Uncooperative Chinese exporters 2.9 51.6
Uncooperative Korean exporters 6.2 N/A
Ta Fong - 9.0 N/A
Uncooperative Taiwanese exporters - 8.6 N/A
CDI - 12.2 N/A
Vina One - 12.0 N/A
Residual Vietnamese exporters - 6.5 N/A
Uncooperative Vietnamese exporters - 6.5 N/A
Table 21 – Dumping and subsidy margins
The Commission found that dumping margins for three of the four co-operating exporters
for whom a verification was undertaken were below negligible levels (2%). Their margins
range from -7.1 per cent to -12 per cent. These exporters were from Taiwan and Vietnam.
As set out in chapter 6.9.5 of this report, in accordance with section 269TDA(1), the
Commissioner has preliminarily determined that the investigation into dumped goods from
Taiwan will be terminated in its entirety, subject to submissions, on the basis that there
has been no dumping by those exporters of the goods the subject of the application.
As set out in chapters 6.10 and 7.6 of this report, in accordance with section 269TDA(1),
the Commissioner has preliminarily determined that the investigation into dumped and
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subsidised goods from Vietnam will be terminated in its entirety, subject to submissions
on the basis that there has been no dumping and subsidisation of the goods the subject
of the application.
The Commissioner has not attributed injury to the Australian industry in relation to exports
of the goods from Taiwan and Vietnam. The Commissioner has had regard to the above
de minimis dumping and subsidy margins from China and Korea in assessing whether the
Australian injury has experienced material injury in relation to those goods.
9.5 Cumulation of injury

The Commissioner’s view is that it is appropriate to consider the cumulative effects of
exports from China and Korea.
Section 269TAE(2C) provides that when determining whether material injury to an

Australian industry has been, or is being, caused or threatened by exports to Australia
from different countries, the Minister should consider the cumulative effect of those
exports only if the Minister is satisfied that:
 the margin of dumping established for each exporter and/or the amount of
countervailable subsidy received is not negligible;
 the volume of dumped and/or subsidised imports from each country is not
negligible; and
 a cumulative assessment is appropriate in light of the conditions of competition
between the imported goods, and between all of the imported goods and the like
domestic goods.
As detailed in Table 21 above, the Commission assessed the dumping margins for
Chinese and Korean exporters and found that they were 2.9% and 6.2%, respectively.
The subsidy margins for China are between 9 and 51.6%.
The Commission ascertained that the volume of dumped and/or subsidised exports from
China and Korea were not negligible. Refer Confidential Attachment 29.
The Commissioner has assessed the conditions of competition between the goods
exported from China and Korea, and the goods exported from China, Korea and like
goods produced by the Australian industry. Due to the nature of the good, customers can
purchase precision pipe and tube from a range of sources. ABF data shows importers
that have sourced the goods from more than one country during the injury analysis
period. The Commission is aware of customers in Australia advising Australian industry of
a range of available import sources from the subject countries. Similarly, domestically
produced goods compete against exports from China and Korea for sales in Australia.
Having regard to the above analysis, the Commissioner’s view is that it is appropriate to
consider the cumulative effects of exports from China and Korea.
9.6 Volume effects

Figure 8 in chapter 8.3.1 depicts the sales volumes in the Australian market commencing
2016.
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Chapter 8.3.2 sets out the market share of the Australian industry, imports from the
subject countries and imports from other countries.
The Australian industry has gained a larger share of the precision pipe and tube market
between 2017 and 2018 and largely maintained that market share in 2019. In the same
period of time, it appears that the share of the market relative to the subject countries
reduced.
In its application, Orrcon argues that its transition from a business with a reasonable
return in 2016/17 to an underperforming operation in 2018/19 coincides with what it terms
a “rapid and dramatic increase” in dumped imports from the subject countries. As seen in
the figure above, there has been an increase in the share of the market supplied by China
and Korea between 2016 and 2017 which reduced between 2017 and 2018 and then
marginally again between 2018 and 2019. The Commission observes that while Orrcon
has lost volumes between 2018 and 2019, it has not lost market share to exports from
China and Korea.
The Commission analysed the import volumes from China and Korea as depicted in the
following figure.
Figure 19 – Imports from the subject countries (CY, MT)
While there was a sharp increase in import volumes from China between 2016 and 2017,
this has seen a decline between 2017 and 2019. Korean imports increased between 2016
and 2017 and have remained low since, with a marginal increase in 2019.
Orrcon’s argument that its transition to an underperforming operation between 2016/17

and 2018/19 is caused by higher volumes from the subject countries during 2018 and
2019, is not supported by the volumes observed by the Commission.
Orrcon provided the Commission with 7 examples of price negotiations. Three of these
negotiations resulted in Orrcon missing out on sales volumes, as it was unable to match
import prices. These examples demonstrate the vulnerability of sales volumes to low
import prices. In the case of Chinese and Korean prices, Australian industry competed
with dumped and subsidised prices in order to secure volumes. The remaining four
examples relate to price related injury and these are addressed in the following section.
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Example 5140
Orrcon was unable to supply to a customer that it has supplied historically, as it was
unable to profitably match the import prices that the customer claimed it had access to.
Specific import prices were supplied from China, however no specific sources were
identified. However, as Orrcon is the only domestic producer of the goods, it is apparent
that the goods not sourced from Orrcon were subsequently sourced from imports.
Example 6
In 2016 and 2017, Orrcon supplied minimal volumes to a customer who historically
purchased both locally produced and imported goods. Evidence was provided to the
Commission of the customer purchasing imported goods. In order to secure volume,
Orrcon offered a price below its fully absorbed costs in 2018. In 2019, Orrcon increased
its offer price (still below fully absorbed costs) and the customer reduced its purchase
volumes. This example provided evidence of the vulnerability of volumes to import prices.
Example 7
During the verification, Orrcon advised that it experiences magnified injury due to its
customers on-selling imported goods to secondary markets. Orrcon provided evidence of
a downstream market customer approaching Orrcon and requesting it to match a
competitor’s imported price. The Commission has confirmed Orrcon’s claim that the
competitor (also a customer) has historically purchased imported goods. Orrcon was
unable to match this price and was unsuccessful in securing the volume.
9.7 Price effects

In its application, Orrcon claimed that production costs increased year-on-year since
2015/16 with increases in global HRC prices impacting precision pipe and tube
producers. As stated in the Orrcon verification report,141 Orrcon advised the Commission
of an internal project designed to reduce its costs to a target level. Orrcon stated that this
was due to the current margins being unsustainable. The Commission reviewed Orrcon’s
raw material costs and found that it had experienced rising feed costs during the injury
analysis period.
In its application142 and during the verification, Orrcon provided evidence of internal
tracking of competing import prices. Orrcon provided further evidence of the importance
of import prices in its own pricing decisions with its submission dated 30 April 2021.143
In recent years, Orrcon has attempted to increase prices to account for increases in
costs. Evidence before the Commission shows that customers have used import prices to
reduce the quantum of these price increases. This and further examples of price
140 Examples 1, 2, 3 and 4 are related to price injury and discussed in the Price effects section.
141 EPR 550, Item 56
142 EPR 550, Item 1.
143 EPR 550, Item 54.
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negotiations have been provided by Orrcon where import sources were used in an effort
to drive down its own prices.
Example 1
Orrcon’s first offer to a customer was rejected as too high in comparison to a Korean
import price. Orrcon reduced its offer due to the requirement to maintain volume at one of
its mills. According to data provided to the Commission, this new price did not cover
Orrcon’s fully absorbed costs in the 2018-19 year.
Example 2
Citing increases in costs, Orrcon attempted to increase its prices. Orrcon claims that the
relevant customer quoted import prices from Korea and negotiated down the price
increase. Orrcon provided internal company notes in support of its claims.
Example 3
This example details ongoing attempts by Orrcon to increase pricing to a customer where
its current price is not covering its full absorbed costs. On several occasions, the
customer rejected the requested price increases based on import comparisons, and
provided a list of import prices to demonstrate Orrcon’s prices were higher. The
Commission has assessed the correspondence relating to this customer and agrees that
the customer uses import prices to drive down Orrcon’s prices.
Example 4
The negotiation relates to import prices from the subject countries. The customer
expressly uses these prices, and it is clear from internal documents that Orrcon has also
referenced import prices in calculating its competing offer. Orrcon has calculated its
forgone revenue due to price depression.
9.7.1 Price undercutting
The Commission analysed and compared the selling price of verified importers with the
price of Orrcon’s precision pipe and tube at the same level of trade.
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Figure 19– Price undercutting analysis based on comparison of verified importer selling prices
The data demonstrates that imports sourced from both China and Korea undercut the
Australian industry during the investigation period. Korean prices in particular significantly
undercut Australian industry prices in the three quarters for which the Commission had
verified data for a comparison.
Price undercutting analysis is at Confidential Attachment 5.
9.8 Profit effects

Orrcon experienced a downward trend in its profitability position as demonstrated in
Figure 5 above. Orrcon moved from a net profit position to a net loss position in 2018
which continued through the investigation period.
Profit is a function of sales revenue and costs. As stated in section 9.7 above, Orrcon
experienced increases in its costs, in particular its HRC raw material costs. As seen in
Figure 10, Orrcon was unable to increase selling prices in order to account for increasing
costs, resulting in a narrowing of its profit margin to a net loss position as shown in
Figure 11. Examples provided by Orrcon provide the reasons for Orrcon’s inability to raise
prices. These examples provide evidence of the impact of import prices on negotiations.
In one instance, Orrcon attempted to raise prices due to cost increases, and this price
increase was negotiated down, citing import prices. In three of the examples provided,
Orrcon lost volumes, as it was unable to compete with import prices.
In its submission dated 30 April 2020,144 RCR argued that if Orrcon has adopted an
aggressive strategy in terms of competition in the market, any downturn in profit or
profitability is likely to be the result of that commercial decision and is not the result of
allegedly dumped (or subsidised) goods. In its application145 and in the examples
provided, Orrcon claims that it has needed to offer unprofitable and unsustainable prices
144 EPR 550, document number 11.

145 EPR 550, Item 1.
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in order to maintain volumes to manage its fixed costs at its two plants. This is supported
by the minor reduction in volumes between 2018 and 2019, while at the same time
experiencing sustained price and profit related injury.
The Commission finds that the reduction in prices by Orrcon was a necessity in order to
manage its fixed costs through maintaining volumes, and was a result of reduced pricing
and profitability, as a result of competition with low import prices.
9.9 Other economic factors

In chapter 8.6.7, the Commission concluded that the Australian industry experienced
injury in the form of reduced revenue, employment numbers, ROI and inventory turnover.
The Commission has found that price pressure from dumped and subsidised imports
resulted in price suppression and price depression, and some reduction in volumes.
These factors together have resulted in reduced revenue.
In addition to reduced employment numbers, in its application, and in documents provided

to the Commission, the Australian industry notes job insecurity among staff due to
reduced volumes and the inability to cover costs of production. The Commission is unable
to make a finding concerning job insecurity among staff based on the evidence provided.
As seen in Figure 10, in chapter 8.4.1, Australian industry has experienced a narrowing of
its margin and in recent years unit CTMS is higher than the unit selling price. At the same
time, the Australian industry has experienced a minor reduction in volumes which have
been maintained in order to cover fixed costs. This has been evidenced by the Australian
industry offering prices below total costs in order to win orders. These two factors
together have resulted in reduced ROI.
9.10 Factors other than dumping and subsidisation causing injury

RCR submitted146 that it is appropriate for the Commission to consider factors such as
increased energy and raw material costs and how these apply to Australian industry’s
claims of material injury before imposing measures.
During the verification, Orrcon claimed that there has been an increase in the volume of
finished goods being imported to Australia that has impacted the demand from the
manufacturing customer segment. Orrcon has identified this segment as the second
largest market for precision pipe and tube. As seen in Figure 9, in chapter 8.3.1 above,
the precision pipe and tube market has seen a decline in overall volumes, which may be
partially explained by the increase in finished goods imports. However, as finished goods
are not captured within this investigation, the Commission is unable to ascertain the
proportion of the decline that is attributable to finished goods imports.
Orrcon further advised that the cessation of automotive manufacturing in Australia has
impacted demand for Australian precision pipe and tube. The Commission notes that
146 EPR 550, Item 11
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Toyota and Holden ceased manufacture in Australia in 2017, which may have contributed
to the decline in the overall size of the market as seen in Figure 8 in chapter 8.3.1.
Concerning imports from countries not named in this investigation, Orrcon advised that of
these, Thailand and India were the main countries exporting precision pipe and tube.
However, Orrcon does not believe these countries have engaged in dumping or material
injury to the Australian industry.
In addition, Orrcon cited high energy costs and the increase in online shopping that
resulted in fewer orders for shop fit-out.
Orrcon also advised of higher raw material costs, as discussed in chapter 9.7 above.
Despite these factors, Orrcon claims that higher manufacturing costs could not be passed
on to customers due to price pressure from dumped and subsidised imports.
The Commission observes that as stated in the Ministerial Direction on Material Injury,147
injury from dumping and subsidisation need not be the sole cause of injury to the industry,
where injury caused by dumping or subsidisation is material in degree.
9.11 Materiality of injury

ADN No. 2012/24 provides that the materiality of injury caused by a given degree of
dumping and subsidisation can be judged differently, depending on the economic
condition of the Australian industry suffering the injury. In considering the circumstances
of each case, the Commission must consider whether an industry that at one point in time
is healthy and could shrug off the effects of the presence of dumped or subsidised
products in the market, could at another time, weakened by other events, suffer material
injury from the same amount and degree of dumping or subsidisation.
The Commission’s analysis of the economic condition of the Australian industry found that
the Australian industry’s:
 sales volumes reduced in the investigation period;

 per unit selling price has reduced since 2017;
 per unit CTMS has continued to increase, overtaking unit selling prices in 2018;
 profits and profitability have seen a steady decline since 2016, with a transition to a
net loss position since 2018; and
 prices during the investigation period were undercut by prices of precision pipe and
tube imported from China and Korea.
In addition, the Australian industry provided the Commission with examples showing it
reduced its own prices in order to compete with import prices, or customers using import
prices to negotiate prices. In some of these negotiations, Australian industry lost volumes,
as it was unable to compete.
147 ADN No. 2012/24 dated 27 April 2012.
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The Commission calculated a dumping margin for China of 2.9% and for Korea of 6.2% in
the investigation period. In addition, the Commission calculated a subsidy margin for
Chinese exporters of between 9.0% and 51.6%. Both China and Korea maintained
volumes during the period from 2016 to 2019, being the first and third largest exporters of
the goods to Australia.148
The Commission found that imports from both China and Korea undercut the Australian
industry’s price during the investigation period. Orrcon provided examples where
customers requested Orrcon to reduce its prices in response to low import prices, which
in the case of Chinese and Korean prices, are dumped and subsidised prices. Based on
this analysis, the Commissioner is preliminarily satisfied that dumped prices from China
and Korea, and subsidised prices from China, placed downward pressure on Australian
industry prices resulting in material injury.
9.12 Preliminary findings

The Commissioner is preliminarily satisfied that dumped imports from China and Korea,
and subsidised imports from China, have caused injury to the Australian industry in the
forms of:
 reduced sales volume;

 price depression;
 price suppression;
 reduced profit
 reduced profitability;
 reduced revenue;
 reduced employment numbers;
 reduced ROI; and
 reduced inventory turnover.
148 Taiwan was the second largest exporter of the goods to Australia in the period.
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10 WHETHER DUMPING AND/OR SUBSIDISATION MAY

CONTINUE
The Commissioner is preliminarily satisfied that, among other things:
 dumping and subsidisation may continue in relation to the export of the goods by
exporters from China; and
 dumping may continue in relation to the export of goods by exporters from Korea.
10.2 Introduction
To publish a notice under sections 269TG(2) and/or 269TJ(2) the Minister must be
satisfied that, among other things, dumping and subsidisation may continue.
When assessing whether dumping and subsidisation may continue, the Commissioner
considers the term ‘may’ to mean ‘possible’.
10.3 Whether dumping and subsidisation may continue

When assessing whether dumping or subsidisation may continue, the Commissioner
considers prior evidence of dumping or subsidisation to be a relevant consideration.
The Commission’s analysis found dumping margins of 2.9% for Chinese exporters and
6.2% for Korean exporters during the investigation period.
The Commission examined import volumes from the ABF import database during and
following the end of the investigation period. The Commission observes that imports from
China and Korea have continued.
The Commission found that China and Korea are the first and third largest exporters of
the goods to Australia and therefore maintain an established share of the market. Both
Chinese and Korean prices undercut Australian industry during the investigation period.
The Commission’s assessment of the market found that purchasers of the goods will
change their sources of supply and purchase decisions are heavily influenced by price.
The Commission was provided with clear examples of customers requesting price
reductions based on lower priced imports.
The Commissions’ countervailing subsidy analysis found a subsidy margin of 9.0%

applying to Dalian Steelforce and 51.6% for non-cooperative entities. The Commission
has considered, where possible, the nature and the qualifying criteria of the various
subsidy programs investigated. In the absence of information to the contrary, the
Commission has assumed that these entities will continue to receive countervailable
subsidies identified in chapter 7.1.1.
Based on the magnitude of the dumping and subsidy margins found, the importance of
price in this market, price undercutting, and the established links and volumes maintained
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by Chinese and Korean exporters, the Commissioner considers that dumping and
subsidisation may continue.
10.4 Commissioner’s assessment

Based on the available evidence, the Commissioner is satisfied that exports of the goods
may continue in the future at dumped prices from Korea and at dumped and subsidised
prices from China.
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11 NON-INJURIOUS PRICE
11.1 Preliminary assessment
The Commissioner is satisfied that there is a situation in the Chinese domestic market
that renders domestic selling prices unsuitable for determining normal value under section
269TAC(1). This provides an exception to the Minister’s mandatory consideration of the
lesser duty rule. Accordingly, in relation to China, the Commissioner proposes to
recommend that the Minister is not required to have regard to the lesser duty rule for the
purposes of sections 8(5BA) and 10(3D) of the Dumping Duty Act, noting that the Minister
may still do so.
In addition, the Commission has calculated the NIP for Korean exporters to be an amount
equal to an un-dumped price. The Commissioner recommends that the Minister have
regard to the desirability of the lesser duty rule. However, based on the fact that the NIP
is not less than the normal value, the lesser duty rule will have no practical effect.
11.2 Introduction
The NIP is defined in section 269TACA as “the minimum price necessary to prevent the
injury, or a recurrence of the injury” caused by the dumped or subsidised goods, the
subject of a dumping duty notice or a countervailing duty notice. The Commission will
generally derive the NIP from the Australian Industry’s unsuppressed selling price (USP).

Where the Minister is required to determine the IDD, section 8(5B) of the Dumping Duty
Act applies. Where the Minister is required to determine both ICD and IDD, sections
8(5BA) and 10(3D) of the Dumping Duty Act apply.
Sections 8(5B), 8(5BA) and 10(3D) require the Minister to have regard to the ‘lesser duty
rule’ when determining the ICD and IDD payable. In relation to a dumping duty notice, the
lesser duty rule requires consideration of whether the NIP is less than the normal value of
the goods. In respect of concurrent dumping and countervailing notices, the lesser duty
rule requires the Minister to consider the desirability of fixing a lesser amount of duty,
such that the sum of the export price of the goods ascertained for the purposes of the
notices, the ICD and IDD, do not exceed the NIP.
However, pursuant to sections 8(5BAA), 8(5BAAA) and 10(3DA) of the Dumping Duty
Act, the Minister is not required to have regard to the lesser duty rule where one or more
of the following circumstances apply:149
 the normal value of the goods was not ascertained under section 269TAC(1)
because of the operation of section 269TAC(2)(a)(ii);
149 Sections 8(5BAAA)(a) to (c) of the Dumping Duty Act concern the calculation of dumping duty and
sections 10(3DA)(a) to (c) of the Dumping Duty Act concern the calculation of countervailing duty.
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 there is an Australian industry in respect of like goods that consists of at least two
small-medium enterprises, whether or not that industry consists of other
enterprises;150
 if a countervailing subsidy has been received in respect of the goods – the country
in relation to which the subsidy has been provided, has not complied with Article 25
of the WTO Agreement on Subsidies and Countervailing for the compliance period.
Nonetheless, the Minister is not required to consider imposing a lesser amount of duty,
but may still wish to exercise the discretion to do so.
11.4 Lesser Duty Rule

11.4.1 China
As discussed in chapters 6.3 and 6.4, the Commission has found that there is a situation
in the Chinese domestic market that renders domestic selling prices unsuitable for
determining normal value under section 269TAC(1). Accordingly, the Commission
considers that sections 8(5BAAA)(a) and 10(3DA)(c) of the Dumping Duty Act apply, and
as a result, the Minister is not required to consider the lesser duty rule for the purposes of
sections 8(5BA) and 10(3D) of the Dumping Duty Act in respect of Chinese exports,
although the Minister may still do so.
The Commissioner recommends that the full dumping and subsidy margins be applied to
any IDD and ICD taken in relation to the goods exported to Australia from China from all
exporters.
11.4.2 Korea
The Commission does not consider that any of the exceptions in the Dumping Duty Act
apply in respect of exports of the goods from Korea. The Commission therefore has
considered whether to recommend that the Minister consider the desirability of applying a
lesser rate of duty to Korean exports, if applicable.
11.4.3 Taiwan and Vietnam
As the Commission proposes to terminate the dumping investigation as it relates to

Taiwanese and Vietnamese exporters, as well as the subsidy investigation as it relates to
Vietnamese exporters, the Commission has not had regard to the lesser duty rule for
exports from Taiwan or Vietnam.
11.5 Calculation of the non-injurious price

The method of calculating a NIP is not prescribed in the legislation, however there are
several methods outlined in the Manual.
150 As defined in the Customs (Definition of “small-medium enterprise”) Determination 2013.
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The Commission generally derives the NIP by first establishing a price at which the
Australian industry might reasonably sell its product in a market unaffected by dumping.
This price is referred to as the USP.
The Commission’s preferred approach to establishing the USP is set out in the Manual
and observes the following hierarchy:
 industry selling prices at a time unaffected by dumping;

 constructed industry prices – industry cost to make and sell plus profit; or
 selling prices of un-dumped imports.
Having calculated the USP, the Commission then calculates the NIP by deducting the
costs incurred in transitioning the goods from the export FOB point (or another point if
appropriate) to the relevant level of trade in Australia. The deductions normally include
overseas freight, insurance, into-store costs and amounts for importer expenses and
profit.
11.6 Submissions received in respect of the non-injurious price

In its submission on 25 May 2020151, with regard to the NIP, Orrcon states that:
 Due to the existence of a particular market situation for goods sold on the Chinese
domestic market, the lesser duty rule is not required to be considered by the
Minister for exports of the goods from China;
 Injury from dumping commenced in 2017. While market selling prices for the goods
may have been unaffected by dumping at that time, the selling prices for the goods
in 2016 reflects lower raw material costs and do not reflect the input costs incurred
by Australian industry in 2019. Therefore, market selling prices from an earlier
period are unsuitable for determination of a USP;
 2019 selling prices are suppressed due to the continued presence of dumped and
injurious imports of the goods from the subject countries and therefore cannot be
used as a basis for the USP; and
 Consistent with previous investigations into HSS, the most appropriate USP is that
based on Australian industry CTMS, plus an amount of profit.
11.7 Commission’s assessment

The Commission has found that there is a situation in the Chinese domestic market that
renders domestic selling prices unsuitable for determining normal value under section
269TAC(1). Accordingly, the Commission considers that the Minister is not required to
consider the lesser duty rule for exporters from China.
As the Commission proposes to terminate the dumping investigation, as it relates to

Taiwanese and Vietnamese exporters, as well as the subsidy investigation as it relates to
151 EPR 550, Item 14.
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Vietnamese exporters, the Commission has not had regard to the lesser duty rule for
exports from Taiwan or Vietnam.
For exporters from Korea, the Commission does not consider that a change in the raw
material costs for the goods requires deviation from the usual method for calculating the
NIP by establishing a USP by reference to industry selling prices at a time unaffected by
dumping, which in this case is selling prices in 2016. However, noting Orrcon’s
submission regarding changing raw material costs, the Commission has examined
Orrcon’s raw material costs between 2016 and the investigation period and has observed
a significant change.
The Manual states that where the USP is older than 5 years, the Commission will
consider updating old prices by indexing or other means where possible. In the present
circumstances, the proposed period of industry selling prices is 3 years before the
The Manual does not preclude the Commission from making adjustments to industry
selling prices less than 5 years old. In the current circumstances, due to the significant
change in the underlying raw material costs which feed into industry selling prices, which
as discussed in chapter 5.4 are dictated by steel coil costs, the Commission considers
that to not make an adjustment would result in fixing a USP that is not representative of
undumped prices for the investigation period.
Accordingly, to account for this change, in its calculation of the USP as the first step in
calculating the NIP, the Commission has adjusted Orrcon’s selling prices for the goods
from 2016 to account for an increase in the underlying raw material costs.
Having calculated the USP, the Commissioner has calculated a NIP by deducting the
costs incurred in getting the goods from the export FOB point (or another point if
appropriate) to the relevant level of trade in Australia. The deductions include overseas
freight, insurance, into-store costs and amounts for importer expenses and profit.
The Commission has assessed that the calculated NIP is not less than the normal values
ascertained for exporters from Korea. As such, there is no basis to apply a lesser rate of
duty, as the NIP is not the operative measure.
The Commission's NIP calculation is at Confidential Attachment 31.
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12 PROPOSED MEASURES
The Commissioner proposes to recommend to the Minister that anti-dumping measures,
using the ad valorem duty method, be imposed in the form of:
 a dumping duty notice in respect of dumping duty that may become payable by
importers of the goods from China and Korea; and
 a countervailing duty notice in respect of countervailing duty that may become
payable by importers of the goods from China.
12.2 Forms of dumping duty available

The forms of duty available to the Minister when imposing anti-dumping measures are
prescribed in the Customs Tariff (Anti-Dumping) Regulation 2013 and include:
 fixed duty method ($X per tonne);

 floor price duty method;
 combination duty method; or
 ad valorem duty method (i.e. a percentage of the export price).152
The various forms of duty all have the purpose of removing the injurious effects of
dumping and/or subsidisation. However, in achieving this purpose, certain forms of duty
will better suit particular circumstances than others. When considering which form of duty
to recommend to the Minister, the Commissioner will have regard to the published
Guideline on the Application of Forms of Dumping Duty November 2013 (the Guidelines)
and relevant factors in the market for the goods.153
12.2.1 Fixed duty method
A fixed duty method operates to collect a fixed amount of duty – regardless of the actual
export price of the goods. The fixed duty is determined when the Minister exercises their
powers to ascertain an amount for the export price and the normal value.
12.2.2 Floor price duty method
The floor price duty method sets a “floor” – for example a normal value of $100 per tonne
– and duty is collected when the actual export price is less than that normal value of $100
per tonne. The floor price is either the normal value or the NIP, whichever becomes
applicable under the duty collection system.
152 Section 5 of the Customs Tariff (Anti-Dumping) Regulation 2013.

153 Available on the Commission website.
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12.2.3 Ad valorem duty method
The ad valorem duty method is applied as a proportion of the actual export price of the
goods. An ad valorem duty is determined for the product as a whole. This means that a
single ascertained export price is required when determining the dumping and/or subsidy
margin. The ad valorem duty method is the simplest and easiest form of duty to
administer when delivering the intended protective effect.
12.2.4 Combination duty method
The combination duty method comprises two elements: the “fixed” element and the
“variable” duty element. The fixed element is determined when the Minister exercises
powers to “ascertain” an amount (i.e. set a value) for the export price and the normal
value. This may take the form of either a fixed duty or an ad valorem applied to the
ascertained export price.
If the actual export price of the shipment is lower than the ascertained export price, the
variable component works to collect an additional duty amount, i.e. the difference
between the ascertained export price and the actual export price. It is called a “variable”
element because the amount of duty collected varies according to the extent the actual
export price is beneath the ascertained export price.
12.3 Submissions received in respect of form of measures

In its submission published on 25 May 2020154, Orrcon referred to the forms of measures
determined by the Commission in previous steel-related cases, which included calculating
dumping duty either by the floor price method, ad valorem method, and combination duty
method. Orrcon recommended that, in its view, the most appropriate form of measure for
precision pipe and tube steel is the combination duty method.
12.4 Commission’s consideration

The Guidelines list the following considerations in respect of the combination duty
method:
 it may not suit those situations where there are many models or types of the good
with significantly different prices;
 it is suited to circumstances where there are complex company structures with
related parties; and where circumvention of measures is likely;
 it can be applied more precisely to certain goods in some cases;
 the ‘effective’ rate of this duty, when the duty has been imposed as a fixed amount
per unit, diminishes in a rising market making it ineffective. The ‘effective’ rate
increases in a declining market making it punitive, which can have adverse effects
on downstream industries; and
 the ascertained export price used in this measure can become out-of-date.
154 EPR 550, Item 14.
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In the present investigation, the Commission has observed a number of different model
types across exporters with significant variance in price – see Figure 5 in chapter 6.4.5 for
an example of variance in Chinese pricing.
The Commission is also aware that there is variance of pricing within the market over
time, as discussed in chapter 11.7, in respect of adjusting Orrcon’s selling prices for the
goods from 2016 to account for an increase in the underlying raw material costs in the
calculation of a USP.
The market for the goods in Australia has been decreasing year-on-year since 2017, as
discussed in chapter 8.3.
The Commission notes that Dalian Steelforce has a comparatively complex company
structure, with its export sales to Australia sold to its related intermediary, Steelforce
Trading, and related party importer in Australia, Steelforce Australia.
The Commission has also considered the use of the ad valorem duty method. The
Guidelines list the following considerations in respect of this method:
 it has an advantage where there are many models or types as it does not require
an ascertained export price or ascertained floor which may not be meaningful
where models show significant price variation;
 it has an advantage for goods which are subject to significant price variations over
time because it does not show the same variability in the ‘effective rate’ of the duty;
 it may not be the most appropriate duty method when applied to goods which may
have high priced varieties or models of the goods, particularly where a particular
variety of goods was not causing injury to the Australian industry; and
 it has a potential disadvantage in that export prices might be lowered to avoid the
effects of this duty.
The Commission has considered the advantages and disadvantages of these two duty
methods in the table below.
Does it suit the Many model Complex company Variability of Relevance of

characteristics of types with structures ‘effective’ rate of duty ascertained export
the goods different price
prices
Ad valorem Yes – there No Yes – price No ascertained
are many fluctuations have export price is
different been observed for required. However,
models of the the goods along with exporters may lower
goods with significant variance in their prices to avoid
varying prices raw material costs the effect of this
over time duty.
Combination No Yes – a significant No The ascertained
volume of goods export price may
exported from China become out of date,
are by Dalian which is likely where
Steelforce, which the underlying raw
has a complex material costs vary.
corporate structure
Table 22 – Consideration of duty method
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12.5 Proposed recommendations

In light of the analysis above, the Commissioner proposes that duties be calculated, in
respect of any ICD and IDD that may become payable, using the ad valorem duty
method.
Where exporters are subject to both a dumping and countervailing duty, the Commission
must consider whether, where a cost input used in constructing normal value is also the
subject of an LTAR subsidy finding, it is necessary to ‘back out’ the relevant subsidy from
the dumping margin to avoid any double counting.
In this investigation, it was found that an LTAR subsidy was available under Program 20
in respect of HRC. HRC was a cost input used in constructing the normal value for
Chinese exporters.
Accordingly, as exporters from China are subject to both a dumping and countervailing
duty, it is necessary to calculate the effective rate of IDD by ‘backing out’ the subsidy
margin attributed to Program 20.
A summary of the proposed recommendations and effective rates of interim duty are
shown in the table below.
Exporter Proposed duty Rate of ICD Rate of IDD Combined

method (%) (%) rate of ICD
and IDD (%)
Dalian Steelforce (China) Ad valorem 9.0 0.0 9.0
All other Exporters Ad valorem 51.6 0.0 51.6
(China)
All Exporters (Korea) Ad valorem N/A 6.2 6.2
Table 23 – Summary of proposed effective interim dumping and countervailing duty
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13 PRELIMINARY AFFIRMATIVE DETERMINATION

13.1 Introduction
Under section 269TD, if at any time not earlier than 60 days after the date of the initiation
of an investigation, the Commissioner is satisfied that there appears to be, or that it
appears that there will be subsequent to the importation of goods into Australia, sufficient
grounds for the publication of a dumping duty notice or a countervailing duty notice, in
respect of the goods subject to the application, the Commissioner may make a PAD.
The Commonwealth may, at the time of making a PAD (or at any later time during the
investigation), require and take securities under section 42, in respect of any IDD or ICD
that may become payable, if the Commissioner is satisfied that it is necessary to do so to
prevent material injury to an Australian industry occurring while the investigation
continues.
13.2 Finding
In chapters 6 and 7, the Commissioner has found that:
 goods exported from China during the investigation period were at dumped and
subsidised prices; and
 goods exported from Korea were at dumped prices.
As outlined in chapters 8 and 9, the dumped and subsidised exports have caused
material injury to the Australian industry producing like goods.
Accordingly, the Commissioner has decided to make a PAD under section 269TD and is
satisfied that it is necessary to require and take securities under section 42 to prevent
material injury to the Australian industry occurring while this investigation continues.
13.3 Securities
The PAD, including the level of securities, will be publicly notified by way of an ADN.155
Securities will be collected from all exporters of the goods from China and Korea and
entered for home consumption on, or after, 2 June 2021.
The Commonwealth will calculate the amount of securities payable using the ad valorem
duty method. The securities applicable to the goods exported to Australia will apply as
follows:
155 In accordance with sections 269TD(4)(a) and 269TD(5).
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Exporter Proposed duty Rate of ICD (%) Rate of IDD (%) Combined rate
method (%)
Dalian Steelforce Ad valorem 9.0 0.0 9.0
(China)
All Other Exporters Ad valorem 51.6 0.0 51.6
(China)
All Exporters Ad valorem N/A 6.2 6.2
(Korea)
Table 24 – Summary of securities
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14TERMINATION
Section 269TDA sets out the circumstances in which the Commissioner must terminate
an investigation in its entirety, or solely in respect of a specific exporter. Section 269TDA
provides for rules of termination on the basis of volumes and scale of dumping by
countries and exporters.
Based on the findings in this SEF, and subject to any submissions received in response,
the Commissioner proposes to terminate:
 the dumping investigation in relation to all exporters from Taiwan and Vietnam, on
the basis that there has been no dumping of any of the goods, in accordance with
 the countervailing investigation in relation to all exporters from Vietnam, on the
basis that:
o in respect of CDI, Vina One and residual exporters, no countervailable
subsidy has been received in respect of any of those goods pursuant to
o in respect of non-cooperative entities, a countervailable subsidy has been
received in respect of some or all of those goods but it never, at any time
during the investigation period, exceeded the negligible level, pursuant to
section 269TDA(2)(b)(ii).
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APPENDICES AND ATTACHMENTS
Confidential Attachment 1 Email exchange between the Commission

and Steelforce Trading
Confidential Attachment 2 Australian market analysis
Confidential Attachment 3 CTM breakdown
Confidential Attachment 4 Raw material cost analysis and benchmark
calculation
Confidential Attachment 5 Australian industry and import sales
analysis
Confidential Attachment 6 Five Steel REQ
Confidential Attachment 7 Email exchange between the Commission
and Five Steel
Confidential Attachment 8 Yantai Aoxin response to request for further
information
Confidential Attachment 9 Hoa Phat Binh Duong Exhibit G-5
Confidential Attachment 10 Dalian Export Price (Replacement)
Confidential Attachment 11 Dalian CTMS (Replacement)
Confidential Attachment 12 Dalian Normal Value (Replacement)
Confidential Attachment 13 Dalian Dumping Margin (Replacement)
Confidential Attachment 14 All other exporters dumping margin
Confidential Attachment 15 Korea constructed normal value calculations
Confidential Attachment 16 Ta Fong Export Price
Confidential Attachment 17 Ta Fong CTMS
Confidential Attachment 18 Ta Fong Normal Value
Confidential Attachment 19 Ta Fong Dumping Margin
Confidential Attachment 20 CDI Export Price
Confidential Attachment 21 CDI CTMS
Confidential Attachment 22 CDI Normal Value
Confidential Attachment 23 CDI Dumping Margin
Confidential Attachment 24 Vina One Export Price
Confidential Attachment 25 Vina One CTMS
Confidential Attachment 26 Vina One Normal Value
Confidential Attachment 27 Vina One Dumping Margin
Confidential Attachment 28 All other entities subsidy analysis
Confidential Attachment 29 Australian market analysis – injury analysis
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Confidential Attachment 30 Orrcon injury examples

Confidential Attachment 31 NIP calculation
Confidential Attachment 32 Vietnam electricity prices
Confidential Attachment 33 Preferential loan benchmark calculation
Confidential Attachment 34 Dalian Steelforce subsidies
Confidential Attachment 35 CDI subsidies
Confidential Attachment 36 Vina One subsidies
Non-Confidential Attachment 1 Assessment of HSS manufacturers
Non-Confidential Attachment 2 Vietnam Steel Master Plan 2015-2025
Non-Confidential Attachment 3 GOV Decision 4977/QD-BCT 2018
Non-Confidential Attachment 4 GOC questionnaire
Non-Confidential Appendix A Assessment of particular market situation –
China
Non-Confidential Appendix B Assessment of particular market situation –
Vietnam
Non-Confidential Appendix C Assessment of alleged subsidy programs -
China
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APPENDIX A ASSESSMENT OF PARTICULAR MARKET

SITUATION – CHINA
This appendix sets out the Commission’s assessment of whether a particular market
situation existed in the Chinese market for the goods during the investigation period.156
A1 The GOC role in the Chinese steel market

A1.1 Overview
The Chinese economy in general has undergone significant economic structural reforms
to transition towards greater liberalisation of trade and foreign direct investment inflows
and outflows. However, the role of government at all levels in the Chinese economy,
controlling trade and foreign direct investment liberalisation for social and economic
purposes, has created a hybrid system in China where decisions of the market are
heavily influenced by government, as opposed to conditions of competition. Simply put,
Chinese firms selling and purchasing in China’s steel markets set prices and make
purchasing decisions that are influenced by the directives and policies of the GOC,
competition with SOEs that reflect the economic, social and fiscal goals of the GOC, as
well as private firm competition on price, product and market share.
A1.2 GOC policies affecting the steel industry
The Chinese steel industry is of significant importance to China’s national, economic and
social security. Growth in this industry has been dependent on structured investment in,
and funding of, fixed assets in SOE steel mills, steel production output for massive
infrastructure and urbanisation projects supported by the GOC and export oriented trade.
A1.3 Initiatives influencing Chinese steel markets

In order to achieve such significant steel manufacturing output to achieve supply-side
economic growth and reform, the GOC manages an array of subsidy programs, soft
lending and credit facilities, preferential loans, land grants and capacity controls to drive
domestic output and consumption of steel. In recent years, China’s steel industry has
played an important role in its economic structural reform and as such, changes in
response to global issues and concerns are slow and incremental. The Commission
understands that the GOC has a preference for incremental reform, so as not to induce
“shock” changes and sudden reforms in its steel industry, which has the potential to risk
the livelihoods of directly employed workers and workers employed in related industries.
Specific initiatives, implemented to address imbalances in the Chinese steel market

broadly, include the Central Government’s supply-side reform initiatives, Advice on
Addressing Excessive Capacity and Relieving Hardship for the Steel industry (GOC
Advice) and The Opinions of the State Council on Reducing Overcapacity in the Iron and
Steel Industry (GOC Opinions).
156 The Commission’s assessment of proper comparison is set out in respect of each exporter in 6.4.
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The GOC Advice proposed that SOE capacity be reduced by 100 to 150 million tonnes by
2020, via the banning of new capacity building and elimination of what are colloquially
known as “zombie mills”.157 The Central Government had also pledged a RMB 100 billion
fund for employee compensation, social security payments and plant closure incentives in
the coal and steel sectors.158
The GOC Opinions forbid the registration of new production capacity in any form and
requires that any production that does not meet environmental, energy consumption,
quality, safety or technical standards be taken offline.159
The Commission recognises the GOC’s attempts to restructure and reorganise the
industry to manage excess capacity, oversupply and environmental concerns. Examples
of these capacity management measures announced include tightening bank lending to
smaller mills, industry consolidation through mergers and acquisitions and use of stricter
environmental requirements to forcibly shut down capacity.160 While noting these efforts
are targeted at correcting current imbalances and resulting distortions, the Commission
considers them to be evidence of the extent of the GOC’s involvement within and
influence over the broader steel industry during the investigation period.
The key concern with zombie mills is that they reflect capacity that is idle rather than
capacity that has been removed from the market permanently. This means that, while the
temporary removal of this capacity has helped support competitive market conditions,
those same plants have potential to return to production when higher steel prices prevail,
leading to further distortions.161 The extent of this issue is reflected in the concern that a
significant amount of the capacity removed in 2016 was already idle, and that the real
capacity permanently removed is estimated to be in the range of 12 million to 20 million
tonnes per year, compared to the reported 65 million tonnes.162 As at April 2017, it was
reported that China had an estimated 650 million tonnes of overcapacity, and favourable
market conditions would likely extend the lifespan of zombie companies, delaying the
GOC’s steel industry reforms.163
In addition, local governments have not fully implemented the central directives on
capacity reduction, with reports that steel mills engage in “capacity swapping” by moving
capacity to more favourable regions, thereby maintaining or increasing the mill’s
capacity.164
157 Liu. H & Song. L, 2016, pp338-339. AME Group, Steel 2016: June Quarter, Strategic Market Study.
2016, Q2. p.9. These mills would be shut down under normal competitive market conditions, due to either
poor profitability or insolvency.
158 Duke Centre on Globalisation, Governance & Competitiveness (Duke Centre), 2016. Overcapacity in
Steel: China’s role in a global problem, September 2016, p.38.
159 KPMG, 2016. The 13th 5 Year Plan: China’s Transformation and Integration with the World Economy,
p.29. Sourced from GOC Opinions, State Council, 4 February 2016.
160 Platts, 2016. Global Market Outlook, Steel Business Briefing. January 2016, p.14.
161 Platts, 2017. Global Market Outlook, Steel Business Briefing. January 2017, p.10.
162 Ibid.
163 DBS Asian Insights, China’s steel sector supply reform, April 2017, p.5.
164 Steel Guru, China to further tighten steel capacity swapping rules - NDRC (10 May 2019) and China to
Halt Capacity Swaps Project Approvals in Steel Industry (24 January 2020).
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The effectiveness of the GOC’s attempts to address overcapacity through mergers and
acquisitions have been constrained by:
 the replacement of older mills with new larger and more efficient mills; and
 closing smaller mills to offset the commissioning of new larger mills.
While this is likely to improve the industry’s structure over the longer term, its impact to
date has been to increase production and exacerbate the existing structural imbalances.
For example, the announcement of the creation of the BAOWU Steel Group indicated that
it would decommission 2.5 million tonnes of capacity to address overcapacity, however, it
also commissioned nine million tonnes of new capacity at its Zhanjiang facility.165 In 2019,
BAOWU Steel Group expected to increase its annual steel production capacity by twenty
million tonnes after an agreement to merge with Magang (Group) Holding Co Ltd.166
In citing the GOC’s ongoing interventions within the domestic steel industry, it is the
Commission’s view that these attempts to address existing structural imbalances have
had limited success to date. Constraints in the effectiveness of these initiatives not only
relate to the extent of the existing imbalances in the industry, but also difficulties in
coordinating activities between central, provincial and local levels of government. The
resistance of provincial and local governments to closing down mills relates to their role
as major employers, sources of tax revenue and providers of social services within their
respective regions.167 Specific examples of these issues include the reliance of their tax
systems on business revenue (including production based VAT) and gross domestic
product (GDP) oriented performance measures which encourage over-investment.168
A1.4 Industry planning guidelines and directives

The central body responsible for developing and administering planning directives, and
providing overarching approval of large scale investment projects within China is the
National Development and Reform Commission169 (NDRC). It is the Commission’s view
that directives from the NDRC, as the GOC’s central planning authority, would thus be
central to both industry specific ‘five-year plans’ and the planning decisions of all levels of
government more generally. More explicit enforcement mechanisms are reflected in the
Notice of the State Council on Further Strengthening the Elimination of Backward
Production Capabilities and Guidelines (the GOC Guidelines).170 Mechanisms to address
non-compliance include:
 revoking of pollutant discharge permits;

 restrictions on financial institutions providing new credit support;
 restrictions on examination and approval of new investment projects;
 restrictions on approval of new land for use by the enterprise; and
165 Platts, 2016. Global Market Outlook, Steel Business Briefing. June 2016, p.11.
166 Reuters, 2019, ‘China Baowu Steel to take majority stake in rival Magang’.
167 Platts, 2016. Global Market Outlook, Steel Business Briefing. April 2016 p.16.
168 Duke Centre, op cit (172), p.29.
169 National Development and Reform Commission.
170 [Notice of the State Council on Further Strengthening the Elimination of Backward Production
Capacities] State Council (China), Notice no. 7, 6 April 2010 (‘GOC Guidelines’).
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 restrictions on issuing of new, and cancelling of existing, production licenses.
According to reports, the GOC Guidelines state that enterprises that do not conform to the
industrial policy shall not be provided financial support by financial departments. More
implicit enforcement mechanisms are reflected by the regulatory powers of bodies, such
as the Ministry of Industry and Information Technology. It is the Commission’s
understanding that such bodies maintain lists of companies that are deemed to be either
compliant or non compliant with national standards on production, environmental
protection, energy efficiency and safety. Those deemed non-compliant are to be
closed.171
It is the Commission’s view that the effectiviness of the above mentioned mechanisms are
reflected in the responsiviness of industry groups and major companies to the GOC’s
various directives.
China adopted its 13th Five-Year Plan for National Economic and Social Development
(the Plan) on 15 March 2016. The Plan outlines China’s goals, principles and targets for
infrastructure, the environment, financial services, health and social and economic
development for the five years to 2020. The Plan has a strong emphasis on supply-side
structural reform that promotes the upgrade of industrial structures, strengthening market
oriented reforms, reducing industrial capacity, inventory, financial leverage and costs, and
correcting structural shortcomings.172 The Plan remained current in the review period.
To support the Chinese steel industry’s development in line with the Plan, the Iron and
Steel Industry Adjustment and Upgrade Plan (2016-2020) (the Upgrade Plan) was
developed. The Upgrade Plan proposed to raise the average annual growth rate of
industrial added value from 5.4% in 2015 to 6% by 2020, raise the capacity utilisation rate
from 70% in 2015 to 80% by 2020, and raise the industrial concentration in top ten
producers from 34.2% in 2015 to 60% by 2020.173 Examples of the Chinese steel
industry’s response to these directives was reflected in the restructuring of the BAOWU
Steel Group. In 2019, BAOWU Steel Group was the largest producer of crude steel in
China and the second largest worldwide.174
There have been a number of GOC policies, plans and initiatives relevant to the China
steel industry published over many years, including the National Steel Industry
Development Policy (2005), the Blueprint for the Adjustment and Revitalisation of the
Steel Industry (2009) and the 2011-2015 Development Plan for the Steel Industry
(2011).175 As these plans have ended, the Commission’s view is that these have been
largely superseded by further policies and plans.
171 Office of the Chief Economist, Department of Industry, Innovation and Science, Resources and Energy
Quarterly (December 2015), p. 47.
172 KPMG, 2016. The 13th 5 Year Plan: China’s Transformation and Integration with the World Economy,
p.3. Sourced from GOC Opinions, State Council, 4 February 2016.
173 King & Spalding, China Issues 13th Five Year Plan for the Steel Industry, Yan, Linga, November 22,
2016.
174 2020 World Steel in Figures, World Steel Association, May 2020.
175 In noting that some of the listed documents are now dated, the Commission considers that this further
demonstrates long term involvement of the GOC within the Chinese steel industry.
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Some of the key themes and objectives of major GOC planning guidance and directives
used to influence the structure of the Chinese steel industry include:
1. Steel Industry Adjustment Policy (2015 Revision)

 upgrading product mix;
 rationalising steel production capacity;
 adjustments to improving organisational structures;
 energy conservation, emission reductions, environmental protection;
 production distribution;
 supervision and administration;
 guiding market exit;
 methods of orientation and oversight of mergers and reorganisations;
 consolidate number of steel companies; and
 lift capacity utilisation rates to 80% by 2017.
2. Circular of the State Council on Accelerating the Restructuring of the Sectors with
Production Capacity Redundancy
 promoting of economic restructuring to prevent inefficient expansion of
industries that have resulted from blind expansion; and
 intensify the implementation of industrial policies related to the iron and steel
sector to strengthen the examination thereof and to improve them in practice.
3. State Council Guidance on the Promotion of Central Enterprises Restructuring and

Reorganisation176
 SOEs restructuring and reorganisation should serve national strategies, respect
market rules, combine with reforms, follow laws and regulations, and stick to a
coordinated approach;
 state-owned capital should support SOEs, whose core businesses are involved
in national and economic security and major national programmes, to
strengthen their operations, and allow non state-owned capital to play a role,
while ensuring the state-owned capital’s leading position; and
 related departments and industries requested to steadily promote restructuring
of enterprises in fields such as equipment manufacturing, construction
engineering, electric power, steel and iron, non-ferrous metal, shipping,
construction materials, tourism and aviation services, to efficiently cut
excessive overcapacity and encourage restructuring of SOEs.
4. The Iron and Steel Industry Adjustment and Upgrade Plan (2016-2020)
 removal of 100 to 150 million tonnes of capacity between 2016 and 2020;
 raising of capacity utilisation rates to 80% by 2020; and
 further industry consolidation leading to 10 largest producers accounting for
60% of production by 2020.
176 General Office of the State Council on Promoting Central Enterprises: Guidance on Structural
Adjustment and Restructuring] State Council on Promoting Central Enterprises (China), Notice no. 56, 26
July 2016 http://www.gov.cn/zhengce/content/2016-07/26/content_5095050.htm.
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5. Guiding Opinions on Accelerating the Merger and Acquisition and Reorganisation

in Key Industries (2013);177
6. Three-Year Action Plan to Win the Blue Sky War (2018–2020, published 2018).178
In addition, broader industrial restructuring and reorganising directives of the GOC have
an impact on the Chinese steel industry.179
In assessing the relevance of these planning guidelines and directives, the Commission
notes the importance of the GOC’s national five year plans which provide the overarching
framework for the industry and local government plans. Regarding industry specific
planning guidelines and directives, the Commission notes, but does not agree with, the
GOC’s previously expressed view that they are for guidance and are not enforceable.180
Mechanisms through which the Commission considers the GOC is able to enforce these
guidelines and directives include the presence and role of SOEs within the broader steel
industry, the role of the NDRC and explicit enforcement mechanisms. The GOC, where it
is also the majority owner of an SOE, can exert its influence through the appointment of
board directors and chief executives.181
SOEs’ significant share of total Chinese steel production, and propensity to follow
government guidance and directives, ensures that the GOC is able to influence broader
trends in industry capacity and steel production. Similarly, the NDRC, through its dual role
of developing planning guidelines and directives and approving large scale investment
projects, has the capacity to ensure that the broader objectives of the central government
are implemented. Explicit enforcement mechanisms detailed within directives, such as the
State Council notice on Further Strengthening the Elimination of Backward Production
Capabilities and Guidelines, includes a range of sanctions, such as revocation of pollutant
discharge permits, restrictions on the provision of new credit support, restrictions on the
approval of new investment projects, and restrictions on the issuing of new and cancelling
of existing production licenses.182
A further example of the GOC’s use of planning guidelines and policy directives to
achieve its objective can be seen in the GOC’s Standard Conditions of Production and
Operation of the Iron and Steel Industry. It is the Commission’s understanding that this
document sets out the minimum requirements for production and operation in the Chinese
steel industry. Firms are incentivised to comply with the standard conditions, as doing so
177 Guiding Opinions on Accelerating the Merger and Acquisition and Reorganisation in Key Industries]
Ministry of Industry and Information Technology (China), Notice no. 16, 22 January 2013
http://www.gov.cn/zwgk/2013-01/22/content_2317600.htm.
178 Three-Year Action Plan to Win the Blue Sky War] State Council (China), Notice no. 22, 27 June 2018
http://www.gov.cn/zhengce/content/2018-07/03/content_5303158.htm.
179 For example, Notice of Several Opinions on Curbing Overcapacities and Redundant Constructions in
Certain Industries and Guiding the Healthy Development of Industries (2009), Guiding Opinions on Pushing
Forward Enterprise M&A and Reorganisation in Key Industries (2013), Guiding Opinions on Resolving
Serious Excess Capacity Contradictions (2013) and Directory Catalogue on Readjustment of Industrial
Structure (2013 Amendment).
180 International Trade Remedies Branch Report No. 177 (REP 177), p.123 refers.
181 Dong Zhang and Owen Freestone, China’s Unfinished State-Owned Enterprise Reforms (2013),
Economic Roundup, The Treasury, Australian Government, issue 2, pp. 79-102.
182 REP 177, p.128 refers.
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provides the basis for policy support. In contrast, firms that do not conform are required to
reform, and if they still fail to conform, must gradually exit the market.183
A1.5 Role and operation of SOEs
It has been observed that:
[SOEs] are an organic component of China’s political and economic governance, although
their contribution to the national output has shrunk to 40%. They are still considered to be
substantial building blocks of the economy and act as a buffer against internal shocks and
external threats.184
The Chinese economy is commonly described as a ‘socialist market economy’ as it

features dominant SOEs co-existing with market capitalism and private enterprise.185
Commentary provided with the 2019 Fortune 500 list indicates that of the 129 Chinese
companies listed that year, SOEs accounted for 80% of the revenue earned, an increase
of 4% on the previous year.186
Between 2010 and 2015, SOEs accounted for 44% of total Chinese steel production.187
However this may have been as high as 60%.188
The World Bank has found that “state enterprises have close connections with the
Chinese government. SOEs are more likely to enjoy preferential access to bank finance
and other important inputs, privileged access to business opportunities, and even
protection against competition.”189
While the Commission does not consider that the presence of these entities alone causes
markets to be distorted, it does consider that the presence of these entities is likely to
result in the GOC’s plans and directives being adhered to. The Commission also
considers that the support provided to these entities by the GOC has enabled many of
them to be operated on non-commercial terms for extended periods, significantly
impacting supply and pricing conditions within the domestic Chinese market.190
Examples of these support mechanisms include government subsidies, support from

associated enterprises (through direct subsidy, interest-free loans or provision of loan
guarantees) and loans from state-owned banks.191
183 Announcement on the Standard Conditions of Production and Operation of the Iron and Steel Industry.
Included in the context of REP 177 on the EPR for that case.
184 Amir Guluzade, published on the World Economic Forum website, How reforms have made China’s
state owned enterprises stronger (21 May 2020).
185 Asialink Business, Overview of China’s economy, accessed 21 July 2020.
186 https://fortune.com/2019/07/27/ceo-daily-july-27-sino-saturday/.
187 Liu. H & Song. L, 2016, p.349.
188 Platts Steel Business Briefing (Platts), Global Market Outlook, January 2016, p.14.
189 World Bank, China 2030: Building a Modern, Harmonious, and Creative Society, Report No. 96299
(March 2013), p.25.
190 Anti-Dumping Commission, Analysis of Steel and Aluminium Markets Report to the Commissioner of the
Anti-Dumping Commission August 2016 (Commissioner’s Steel Report), p.47.
191 Liu. H & Song. L, 2016, p.348.
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The Commission considers these mechanisms have supported the rapid expansion of
steel production capacity in the SOE segment, in spite of repeated attempts by the
Central Government to reduce the scale of steel production. It is also the Commission’s
view that these support mechanisms have created rigidities in the way recipient firms
respond to price and profit signals and hence have significantly contributed to the
excessive investment in capacity, excess steel production and distorted prices.
The significance of SOEs to the broader Chinese economy, including the steel industry, is
also reflected in the State Council of China’s Guidance on the Promotion of Central
Enterprises Restructuring and Reorganisation (the Guidance).192 In introducing the
Guidance, the State Council notes the important role of SOEs in actively promoting
structural adjustment, optimisation of structural layout and quality improvement within the
Chinese economy. The Guidance also indicates that the State Council will deepen reform
of SOE policies and arrangements to optimise state owned capacity allocation, promote
transformation and upgrading. Details concerning the promotion of central enterprises
restructuring and reorganisation include the ‘safeguard measures’ theme, the
strengthening of the organisation and leadership of SOEs, strengthening of industry
guidance, increased policy support and improved support measures more generally.
In 2019, the GOC announced its intention to introduce a three year action plan on SOE
reform, which reflects the continuation of the significance of SOEs to the Chinese
economy.193 The plan is designed to target mixed-ownership reform and strategic
restructuring in sectors including coal and electricity, steel and non-ferrous metal. In
recent years SOE reform has focussed on consolidation through mergers and
acquisitions, which has (arguably) increased the state’s presence in the market.194
The Commission considers that in combination with slow, incremental policy reform and
the GOC’s economic and fiscal stimulus packages, the role of SOEs in general, involved
in “…capital intensive sectors that produce intermediate but highly tradable goods with
important linkages to other upstream and downstream economic activities, such as the
mining, chemicals or even electronics sectors…”195 provides a buffer to the Chinese steel
industry from external market forces. Those SOEs “…operating in upstream sectors…
provide inputs to steel companies at below-market prices and in preferable terms. The
same applies to downstream [SOE] companies buying steel products at above-market
rates, thus providing support to steel companies. In addition, several concerns relate to
the functioning of the financial sector in the presence of [SOEs].”196
A1.6 The role of the GOC in private firms
In addition, the Commission understands that whilst not expressly compulsory under law,
private firms engage with the policies and objectives of the GOC by aligning their
192 The State Council, notice advising the issuing of the guideline on reorganization of SOEs (July 2016).
193 The State Council, notice urging SOEs to increase profitability and deepen reform (July 2020).
194 Hong, Y (2019), ‘Reform of State-owned Enterprises in China: The Chinese Communist Party Strikes
Back’, Asian Studies Review, pp.332-351.
195 OECD Steel Committee, State Enterprises in the Steel Sector (20 December 2018), p.5.
196 OECD Steel Committee, State Enterprises in the Steel Sector (20 December 2018), p.8.
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commercial interests with industry directives and where relevant, appointing party
members on supervisory boards.
A1.7 Direct and indirect financial support

Examples of specific support programs provided to Chinese steel producers by the GOC,
as identified by the American Iron and Steel Institute and the Steel Manufacturers
Association, include preferential loans and directed credit, equity infusions and/or debt-to
equity swaps, access to land at little or no cost, government mandated mergers
(permitting acquisition at little or no cost) and direct cash grants for specific steel
construction projects.197 Similar programs have been previously identified by the
Commission in respect of the Chinese steel industry. It is the Commission’s view that
these programs have directly contributed to conditions within the Chinese steel industry
during the investigation period by providing direct financial support to recipient steel
producers.
The Commission notes that countervailable subsidies have been received by exporters
from China (see chapter 7 of this Report). These subsidies and tax concessions reduce
the operating costs of Chinese steel enterprises, confer a competitive advantage through
the ability to offer steel products at lower prices, and increase the profitability of steel
production.198 It supports unprofitable producers, delaying or preventing their timely exit
from the industry.
A1.8 Taxation arrangements

The Commission has previously identified evidence of export taxes and export quotas on
a number of key inputs in the steel making process including coking coal, coke, iron ore
and scrap steel in Anti-Dumping Commission Report No. 198.199 The Commission found
that these measures would keep input prices artificially low and create significant
incentives for exporters to redirect these products into the domestic market, increasing
domestic supply and reducing domestic prices to a level below what would have prevailed
under normal competitive market conditions.
The GOC has traditionally operated, amongst other taxation arrangements, a VAT and a
VAT rebate system for certain exported goods which has undergone incremental change.
In 2018 and 2019, the GOC implemented a further series of VAT reforms, which included
lowering the VAT rates paid, as described in the table below.

198 Commissioner’s Steel Report, at www.adcommission.gov.au p.45.
199 Concerning hot rolled plate steel exported from China, the Republic of Indonesia, Japan, the Republic of
Korea and Taiwan; pp. 41-43.
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Tier 1 VAT rate Tier 2 VAT rate Tier 3 VAT rate Tier 4 VAT rate
payable payable payable payable
Pre-1 July 2017 17% 13% 11% 6%
1 July 2017 17% 11% 6% Tier 4 revoked
1 May 2018 16% 10% 6%
1 April 2019 13% 9%
Table 25: VAT rate reform in China 2017 to 2019200
The relevant VAT rate for the goods during the investigation period was 16% from 1
January to 31 March 2019, and then 13% from 1 April 2019 onwards.
Under the Chinese VAT system, VAT is paid on consumption of goods, including the
inputs used in the production of steel. For goods produced and sold within China, the tax
is ultimately paid by the final consumers of the particular good “…and successive tax
payers are allowed to deduct the VAT they pay on their purchases while they account for
VAT they collect on the ‘value added’”.201 Because it is difficult for exporters to pass on
the input VAT tax to export customers, eligible steel exporters have traditionally been
compensated for input VAT paid during the production process via the payment of VAT
rebates.
Through altering the VAT rebates and taxes applied to steel exports, the GOC is able to
alter the relative profitability of different types of steel exports compared to domestic
sales. For example, by either reducing VAT rebates or increasing export taxes on steel
exports, the GOC is able to reduce the relative profitability of exports to domestic sales
and hence provide significant incentives for traditional exporters to redirect their product
into the domestic Chinese market. By using these mechanisms to alter the relative supply
of particular steel products in the domestic market, the GOC is also able to influence the
domestic price for those products.
During the investigation period, the applicable VAT rebate rates for exports of the goods
was 10%.
These changes, along with changes to the domestic VAT rate, resulted in applied VAT
rates for exports of the goods until 31 March 2019 of 6% and 3% for the remainder of the
investigation period. No export tariffs were payable on the goods, which when combined
with the reduction in actual VAT paid on exporters of the goods, would create a further
incentive for export.202
200 https://www.oecd.org/tax/consumption/status-of-the-vat-reform-in-the-peoples-republic-of-china-
2018.pdf - 2019 rates verified for the goods in the investigation period.
201 https://www.oecd.org/tax/consumption/status-of-the-vat-reform-in-the-peoples-republic-of-china-
2018.pdf.
202 GOC RGQ, Attachment D6 – Schedule of rates, EPR item 10
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A2 Competition in Chinese steel markets

One of the important features of the Chinese steel market is the lack of import competition
such that price setting and competition in the domestic market is predominantly, if not
solely, influenced by domestic firms.
The May 2020 US International Trade Administration (USITA) Global Steel Trade Monitor
Report highlights that steel production in China is driven by its domestic demand and
consumption, such that import penetration (as a function of consumption) in steel has
remained low, at 1.6% in 2018 and 2019. The figure below shows the USITA analysis.
Figure 20 – Steel imports in China203
Conversely, China’s exports of steel represent approximately 62 million tonnes in 2019 or

about 6% of its production.204
The Commission considers the GOC’s involvement and influence over the steel industry
to be a primary cause of the prevailing structural imbalances within both the broader steel
industry and the HRC and precision pipe and tube steel markets. The issuance of
planning guidelines and directives along with provisions of direct and indirect financial
support205, 206 creates a domestic market that benefits domestic producers and supports
inefficient enterprises, but does not support access and therefore competition from foreign
producers.
The Commission acknowledges that China’s supply side structural reform targets the
structure of production, to make it more efficient and to balance the supply side of China's
economy with the demand side.207 It is a “…suite of policies focus[ing] on reducing
203 United States International Trade Administration, Global Steel Trade Monitor, Steel Imports Report:
China, May 2020.
204 United States International Trade Administration, Global Steel Trade Monitor, Steel Exports Report:
China, May 2020.
205 Support measures include stimulus programs, land and energy subsidies and soft lending policies.
207 https://www.rba.gov.au/publications/bulletin/2018/dec/chinas-supply-side-structural-reform.html
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distortions in the supply side of the [Chinese] economy and upgrading the industrial
sector.”208 China’s steel industry has been a key focus of these policy reforms.
In short, the Chinese steel market is constructed such that preferential treatments,
whether focussed at SOEs or not, creates a situation of “…competition for factors of
production…”209 rather than market driven competition based on price, service and value.
The Commission therefore considers that the GOC’s historic and continued involvement
in the Chinese steel industry, through its policies, planning guidelines, plans and
directives, materially contributed to its steel industry’s overcapacity, oversupply and
distorted structure during the review period. It is the Commission’s view that these
features have the effect of limiting foreign competition and that the price of HRC (and
therefore precision pipe and tube) would be substantially different in a market not
characterised by GOC influence.
A3 GOC influence on the Chinese market for the goods

The Commission has found in the preceding section that the GOC exerts significant
influence over the Chinese steel market. This section identifies the degree of that
influence on HRC prices in China and therefore the cost of the primary steel input feed in
the manufacture of the goods by Chinese producers.
A3.1 Comparison of raw material prices

As a result of previous cases and after considering the evidence before it for this
investigation, the Commission considers that normal competitive market conditions
prevail in the Korean and Taiwanese domestic markets for steel coil and that purchases
of steel coil in these markets are not influenced by prices in China.210 The Commission
therefore considers that steel coil purchases in these markets are suitable for comparison
with steel coil purchases in China to quantify the effect of GOC influence on Chinese steel
coil prices during the investigation period.211
The Commission notes that Dalian Steelforce, the sole cooperating Chinese exporter,
sourced steel coil solely from Chinese steel mills.
In its analysis, the Commission has compared, on a monthly basis:
 the CRC price paid by the cooperative Chinese exporter and the CRC MEPS
prices for China, Korea and Taiwan;
208 https://www.rba.gov.au/publications/bulletin/2018/dec/chinas-supply-side-structural-reform.html
209 Dong Zhang and Owen Freestone, China’s Unfinished State-Owned Enterprise Reforms (2013),
Economic Roundup, The Treasury, Australian Government, issue 2, pages 79-102, December; at p.91
210 See SEF 529 available on the Commission’s website.
211 The Vietnamese HRC market has previously been considered by the Commission to be subject to normal
competitive market conditions, but due to the allegation in this investigation that there is a particular market
situation in respect of Vietnamese exports of the goods, HRC purchases by Vietnamese producers have been
excluded from this assessment.
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 the pre-galvanised coil price paid by the cooperative Chinese exporter and the pre-
galvanised coil MEPS prices for China, Korea and Taiwan; and
 the Chinese HRC MEPS price and the HRC MEPS benchmark for Taiwan and
Korea.
As all pricing data used by the Commission in its analysis was reported in the relevant
local currency, the Commission has converted and compared prices in USD. The
Commission performed a currency fluctuation analysis as part of this process to examine
whether any such fluctuations may have distorted its price comparisons.
As the currency conversion has been made on an average monthly exchange rate, the
Commission has not undertaken an assessment for short-term (i.e. on a daily basis)
currency fluctuations. However, the Commission has assessed whether there has been a
sustained currency fluctuation experienced between the USD and any of the local
currencies used. Figure 21 below depicts monthly movements in the exchange rate for
each of the relevant currencies to the USD.
Figure 21 – Monthly currency movements to the USD
The currency with the greatest monthly movement against the USD is the Korean won
(KRW). However, the largest monthly movement in the KRW-USD exchange rate is less
than 4%, with no cumulative movement of greater than 5% over any two consecutive
months. The Commission considers a fluctuation equal to or greater than 5% over an 8
week period to constitute a sustained currency movement. Accordingly, as there appears
to have been no sustained currency fluctuation over the investigation period, the
Commission is satisfied that a USD comparison between prices will provide a result
undistorted by currency movements.
Figure 2 and Figure 3 in chapter 6.4.4 examined the CRC and pre-galvanised coil prices
paid by the cooperative Chinese exporter and the CRC MEPS prices for China, Korea
and Taiwan. The figures show that prices for these coil types in China, whether
purchased by the cooperating Chinese producers or reported in the MEPS data, are
substantially lower than equivalent average prices for Korea and Taiwan, with differences
of between 5% and 16% for pre-galvanised coil and 17% and 25% for CRC.
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The Commission has also examined HRC prices over the investigation period as it forms
the base for CRC and pre-galvanised coil (see chapter 6.3.4).
Figure 22 below depicts the monthly price of HRC over the investigation period as
reported by MEPS for China, Korea and Taiwan, including the average for Korea and
Taiwan, which has been taken as the competitive benchmark for HRC.212
Figure 22 - HRC prices – EXW, plus delivery in USD/MT
Figure 22 shows similar prices paid during the investigation period in Korea and Taiwan
between the competitive benchmark and Chinese prices, with differences of between
12% and 22% in any given month.
212 Adjusted to be at EXW including any delivery costs where necessary.
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Figure 23 – Weighted average HRC cost price
Figure 23 above shows that domestic steel coil prices, regardless of coil type, paid by
Dalian Steelforce are considerably lower than the verified prices paid by producers in
Taiwan and Australia, being at least 10% lower in any given month, and as much as 29%
lower at other times. No steel coil purchasing data was provided by Korean exporters
during the investigation.
The Commission therefore considers that Chinese exporters clearly benefit from lower
prices for raw materials than other producers, as a result of a market situation affecting
steel prices in the country.
The Commission considers that the difference between prices represents the degree to
which steel coil prices in the Chinese domestic market have been distorted as a result of
GOC influence.
The Commission’s raw material input analysis is provided at Confidential Attachment 4.
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APPENDIX B ASSESSMENT OF PARTICULAR MARKET

SITUATION – VIETNAM
This appendix sets out the Commission’s assessment of whether a particular market
situation existed in the Vietnamese market for the goods during the investigation period.
B1 Introduction
In its submission213, Orrcon alleged that the domestic prices of precision pipe and tube
are not suitable for the determination of normal values on the basis that intervention by
the GOV in the iron and steel industry raw material supply markets has distorted the
prices of the subject goods during the investigation period.
Orrcon’s submission quotes the terms set out in Vietnam’s Protocol of Accession to the
WTO. Vietnam therein agreed that other WTO Members would be permitted to use
special rules for the determination of whether non-market economy conditions exist in the
context of anti-dumping cases. Specifically, Vietnam agreed that an importing Member
would be permitted to “…use a methodology that is not based on a strict comparison with
domestic prices or costs in Vietnam if the producers under investigation cannot clearly
show that market economy conditions prevail in the industry producing the like product
with regard to manufacture, production and sale of that product.”214
Under these terms, the burden of proof lies with the Vietnamese exporter to show that
market conditions prevail, with the assumption otherwise being that the market conditions
in Vietnam are not representative of a properly competitive market. However, this
provision expired on 31 December 2018, and so is not considered to be in force during
this investigation.
Further, Orrcon submits that prices in Vietnam for the goods are “artificially low, or lower
than they would otherwise be in a competitive market”. Specifically, Orrcon points to GOV
influence in the areas of:
 electricity prices;
 Steel Master Plans;
 industrial development strategy;
 state ownership of precision tube producers;
 domestic price stabilisation initiatives;
 steel industry construction project and investment control; and
 steel industry subsidisation
213INV 550 application by Orrcon, available on the Commission’s website

214WTO, Report of the Working Party on the Accession of Vietnam, WT/AA/VNM/48, 27 October 2006, at
para 255
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B2 The GOV role in the Vietnamese steel market

B2.1 Electricity prices
The Commission has previously considered the issue of GOV influence and control over
electricity prices in Investigation 416 into steel rod in coils exported from Indonesia, Korea
and Vietnam. In that investigation, the Commission found that “the level of control
exercised by the GOV on electricity prices has artificially suppressed the price of
electricity in Vietnam.”215 As a result, the Commission substituted the price of electricity
with a market rate as determined by the World Bank. Orrcon here asserts that, in respect
of the goods under consideration in this case, “cost distortions in the Vietnamese
electricity market have a significant impact on the production costs of Vietnamese
precision tube manufacturers, and that competitive conditions do not exist for domestic
electricity prices in Vietnam.”216
The Commission notes that the production process for steel rod in coil differs significantly
to that of the goods in this case. The production of billet from iron ore and metallurgical
coke to then produce steel rod in coil is a much more energy intensive process than that
detailed in chapter 4.5 for precision pipe and tube steel. Raw material costs, rather than
manufacturing overheads (under which electricity would be reported) also make up a
larger proportion of the CTM for the goods, compared to steel rod in coil, as detailed in
chapter 6.3.4.
In its RGQ, the GOV confirmed that electricity pricing is regulated by the government, with
different prices between the manufacturing sector, administrative and governmental
sector, trading sector and households. Within each sector, all entities are charged at the
same rate.217
The Commission has compared the prices provided by the GOV with prices provided by
the World Bank. Noting that in Vietnam different rates apply to different sectors and are
dependent on voltage, the Commission is satisfied that the World Bank electricity price
adequately reflects electricity prices in Vietnam and aligns with the data provided by the
GOV.
The Commission has then examined the World Bank price for electricity for the
investigation period and notes that prices in Korea, Malaysia and Taiwan are all cheaper
than Vietnam, although it notes China and Australia are higher.218
In light of the above, the Commission is not satisfied that there are significant cost
distortions in the Vietnamese electricity market, and that, if there were distortions, they
would have a significant impact on the production costs of Vietnamese precision tube
manufacturers.
215 SEF 416 and Termination Report 416, available on the Commission website
216 EPR 550, Item 1, p. 48
217 EPR 550, Item 36, Exhibit 45
218 Confidential Attachment 32 – Vietnamese electricity prices
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B2.2 Steel Master Plans

As detailed by the applicant, the GOV has in recent decades detailed their plans for their
domestic steel industry in a two stage Master Plan, as below:
 The Steel Master Plan 2007-2015 (Decree No. 145/2007/QD-TTg)219; and

 The Steel Master Plan 2015-2025 (Decision No. 694/QD-BCT).220
The original Steel Industry Plan (2007-2015) contained production targets of 23 million
tonnes of finished steel production by 2020 and 28 million tonnes by 2025.221 This was to
be achieved via large investment projects in a number of steel manufacturing facilities.
The GOV sought to develop a domestic steel industry through a range of policy objectives
including:
(i) Protection of the domestic industry through technical barriers and environmental
standards;222 and
(ii) Tasking various Ministries in the GOV with enacting various policies, including
protecting domestic steel manufacture against competition from foreign steel
products and imposing import tax and export tax policies to step up investment in
the development and restructuring of the steel industry in Vietnam.223
The Steel Master Plan 2007-2015 was superseded by the Steel Master Plan 2015-2025.
The later plan details a diversification in domestic steel production into the production of
hot-rolled, cold-rolled and galvanised steel.
 Article 1(5)(a) demonstrates a shift to greater diversification:
Having incentive policies for combined steel plant projects. Prioritising the
investment in projects of manufacturing pig iron, steel billets, hot rolled steel sheet,
alloy steel, steel of high quality, large shaped steel and stainless steel…
 Article 2(3) seeks to influence and control steel prices:
People’s Committee of centrally-affiliated cities and provinces shall: Direct the

market management force in the area to coordinate with the authorities to
strengthen the inspection and control of prices of steel products; prevent
speculation, fake and ensure price stability steel in the area.
In response to these claims by the applicant, the GOV submitted that the Steel Master
Plans were made redundant from the beginning of 2019, as a result of further laws
passed by the GOV224. The first, Law on Planning No. 21/2017/QH14, decreed that
manufacturing industries, including steel, are no longer the subject of master plans
219 Available on the GOV legislative gazette at http://vbpl.vn/TW/Pages/vbpqen-

toanvan.aspx?ItemID=3341&Keyword=145/2007/QD-TTg
220 Non-confidential Attachment 2
221 Steel Master Pan 2007-2015, Article 1(3)(a)
222 Ibid, Article 1(3)(c)
223 Ibid, Article 2
224 INV 550 Document No. 004, GOV submission, available on the Commission website
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developed by the GOV. Following that law, the Ministry of Industry and Trade
promulgated Decision No. 4977/QD-BCT to repeal specific products planning under the
provisions on Law on Planning No. 21/2017/QH14, including Decision No. 694/QD-BC
(otherwise known as the Steel Master Plan 2015-2025).225
The Commission has verified the claims of the GOV:
 Article 59(1)(d) of the Law on Planning No. 21/2017/QH14 provides that:
The planning for investment in and development of specific goods, services and
products, determination of the volume of goods, services and produced and sold
products that is decided or approved is null and void no later than December 31,
2018.
 Article 1 of Decision No. 4977/QD-BCT provides that the Steel production and
distribution system development planning up to 2020, with a vision to 2025 was
annulled on 27 December 2018.
Accordingly, the Commission is satisfied that the legal basis for the Steel Master Plans
referenced by the applicant are no longer in force.226
In its submission, dated 9 April 2020227, Orrcon submitted that the revocation of the Steel
Master Plan in no way hinders or minimises the effects of the plan on Vietnamese
production of the goods and prices over the investigation period. Rather, the effects of the
plans, which impacted the structure and capacity of Vietnam’s precision pipe and tube
steel industry, continue beyond December 2019. The plans, when in force, set production
capacity goals, established guidelines for the development of Vietnam’s steel distribution
channels, including distribution centre market shares, established forecasts and targets
for steel product consumption to 2025, protected, expanded and stabilised the domestic
steel market, mandated the removal of outdated production facilities and improved
competitiveness, enabling the Vietnamese industry to garner a competitive advantage
over foreign producers. Orrcon submits that the impact of the plans will significantly affect
the Vietnamese steel industry, including producers of the goods, for years to come.
The Commission has not been presented during the investigation with evidence regarding
the long term effects of the Steel Master Plans on the Vietnamese steel industry. While
there are forecasts for increased production to 2025, whether these production goals are
met and whether there is then a causal link between the Steel Master Plans and the
increased production is, with respect to the information before the Commission, merely
speculation.
225 Ibid, p240

226 Non-confidential Attachment 3 - GOV Decision 4977 _ QD-BCT 2018 abolishes planning for specific
products and services
227 EPR 550, Item 6
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B2.3 Government Policies and Directives – Industrial Development

Strategy
Orrcon’s application details the GOV’s industrial development strategy, as laid out in the
Steel Master Plans. In particular, Orrcon highlights the strategic goals below:
 To develop the industrial sector on the basis of effective mobilization of resources

from all economic sectors; to encourage the development of the private sector and
foreign invested sector;
 To develop priority industries and industrial fields, primarily focusing on agricultural
and rural industrialization and modernization, on the basis of high-quality human
resources and advanced technologies, regarding competition as a driving force for
development;
 To utilize existing advantages and international opportunities; to associate
production with services and trade, and to actively participate deeply into the world
industrial production value chain;
 To focus on developing a number of dual-purpose industries to serve national
defence and security; and
 To develop the industrial sector on the basis of green growth, sustainable
development and environmental protection.228
As with the Steel Master Plans, the GOV submitted that Law on Planning No.
21/2017/QH14 and Decision No. 4977/QD-BCT render the Industrial Development
Strategy now unenforceable within the steel industry.
Similar to the ongoing effects of the Steel Master Plans, the Commission has not been
presented during the investigation with evidence regarding the long term effects of the
strategies outlined above on the Vietnamese steel industry.
B2.4 State Ownership of Large Steel Tube Producers

Vina One
Orrcon submitted that Vina One, a co-operating exporter of precision pipe and tube in this
investigation, is an SOE. Vina One’s questionnaire response indicates that, while
originally set up by the Department of Planning and Investment of Long An Province,229
Vina One is now a privately owned enterprise, and is not controlled or influenced by the
GOV. This was verified by the case team during the investigation.
Vietnam Steel
The large integrated steel producer Vietnam Steel (VN Steel) manufactures a range of
steel products, including both inputs for and finished products and is operated in
228 VGP Prime Minister Nguyen Tan Dung on June 9, 2014 signed Decision No. 879/QDTTg to approve the
Industrial Development Strategy through 2025, vision toward 2035
229 INV 550 no. 35, available on the Commission’s website
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accordance with a charter from the GOV. The GOV has an active role in VN Steel’s
management and daily operations.
In a paper by Nozomu Kawabata published in 2017, it was suggested it is debatable

whether VN Steel has a significant role in the market relating to prices and production of
other firms. VN Steel does not receive GOV subsidies, and any GOV intervention may
only be due to it falling into management crisis, itself a result of delays in corporate
governance reforms.230
VN Steel has an annual finished steel production capacity of 2.5 million tonnes, with an
additional capacity to produce 1.5 million tonnes of billet. This compares to Hoa Phat
Group, a private company, which has an annual steel production capacity of finished steel
products of 2.77 million tonnes.231 Hoa Phat now considers itself the market leader, above
VN Steel, in construction steel companies.
Assessment
In light of the above, the Commission does not consider large scale GOV policy initiatives
are enacted through SOEs.
B2.5 GOV price stabilisation

Orrcon submits evidence of the GOV engaging in price stabilisation initiatives in the steel
industry, by referencing:
 Directives to the state owned VN Steel in 2008 to maintain unchanged steel prices
for as long as possible;
 A quote from the Price Management Department of the Ministry of Finance from
April 2010 – “The government has long had steel on a list of products in need of
price stabilisation…if there’re [are] sudden changes to the price, government
agencies totally have the power to stabilise it;”232
 Circular 122, which delegates authority to the Ministry of Finance to control price
over an extensive list of goods when the prices of those goods increase or
decrease without legitimate cause. Steel is among the list of goods subject to price
controls. Circular 122 has been superseded by the Price Law (coming into effect
January 1, 2013).233
VN Steel
The Commission considers that the impact of any directives from the GOV to VN Steel in
2008 are unlikely to have a continuing impact during the investigation period. The
230 KAWABATA Nozomu, 2017. "Decline and Restructuring of a State-owned Enterprise Group in the
Vietnamese Iron and Steel Industry (Japanese)," Discussion Papers (Japanese) 17066, Research Institute
of Economy, Trade and Industry (RIETI), available at https://ideas.repec.org/p/eti/rdpsjp/17066.html
231 Hoa Phat Annual Report 2019, p37, available at https://file.hoaphat.com.vn/hoaphat-com-
vn/2020/05/annual-report-2019.pdf
232 Thanhnien News, “Vietnam steel producers manipulating prices”, 9 April 2010
233 Export.Gov, “Vietnam – Trade Barriers,” 24 August 2018
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Commission also notes, as discussed in Non-confidential Appendix B2.4, VN Steel

does not have an influential impact of the Vietnamese steel industry.
Price management
The Commission notes that the quote provided by Orrcon in the application regarding
price management234 is from 2010 and was in the context of allegations of steel price
manipulation by Vietnamese metal producers. The Commission also understand that the
powers referred to by the Price Management Department to stabilise prices come from
Circular 122, which is discussed further below.
Circular 122
The Commission has examined Circular 122 and confirms that it relates to the
implementation of price stabilisation; powers and responsibilities of agencies,
organisations and individuals in the elaboration, submission and appraisal of price plans
and price decisions; price consultation dossiers and procedures; control for price factors;
forms and procedures for price registration and declaration of prices of goods and
services.235 Such measures can be implemented where: 236
 the price increase is higher than the increase in the price of the inputs, or higher
than the cost price of imported goods;
 the price increases or decreases are not grounded, while the price constituents
have no change, in the event of natural disasters, fires, epidemics, enemy
sabotage, economic-financial crisis, or loss, temporary supply-demand balance or
due to unfounded rumours of price increases or decreases; and
 unreasonable increase or decrease in prices due to abuse of monopoly position or
market dominance.
Circular 122 also specifies that the measures relate only to certain goods and services,
listed in Decree 75/2008.237 Decree 75/2008 lists “Construction steel” as a good which is
subject to price stabilisation.
However, both Decree 75/2008 and Circular 122 expired on 1 January 2014.
B2.6 GOV control over projects and investments

In its application, Orrcon provided the following examples of GOV control within the
Vietnamese steel market:
 In April 2017, the GOV halted construction on the Hoa Sen Ca Na steel plant in
Ninh Thuan Province, an approx. US$10.6B project that had approval from almost
97% of Hoa Sen shareholders. The project is yet to receive GOV approval,
234 Thanhnien News, “Vietnam steel producers manipulating prices”, 9 April 2010, available at
http://www.thanhniennews.com/business/vietnam-steel-producers-manipulating-prices-16995.html
235 Article 1 of Circular No. 122/2010/TT-BTC, available at http://vbpl.vn/TW/Pages/vbpq-
toanvan.aspx?ItemID=25631
236 Ibid, Article 2(2)
237 Available at http://vbpl.vn/TW/Pages/vbpq-toanvan.aspx?ItemID=12714
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however the impact of this decision is an overall reduction in steel production in

Vietnam compared to if the project had gone ahead, and therefore not likely to
result in lower steel prices in the country. Moreover, environmental and planning
concerns have been quoted as the reasons behind the decision.238
 The GOV in 2016 removed 12 projects from the most recent Steel Master Plan due
to “ineffective investments and incapable investors.”239 The GOV also directs steel
companies to upgrade their production technologies, find ways to save production
costs, and require greater flexib[ility] in monthly and quarterly plans to better
promote brands and build distribution networks.240
The GOV in its RGQ provides that investment projects related to the goods or any of the
upstream raw materials used to manufacture the goods are subject to the same
investment regulations as other sectors, in accordance with:241
 Law on Investment 67/2014/QH13242; and

 Decree 118/2015/ND-CP243, which details the implementation of a number of
articles of the Law on Investment.
The Commission has reviewed Law on Investment 67/2014/QH13 and Decree

118/2015/ND-CP and is satisfied that investors may make their own investment
decisions, in accordance with the relevant laws of Vietnam. The relevant laws restrict
investment in certain areas, but do not appear to impose a level of power and control
within the GOV over the steel industry, such as to prevent market decisions on
investment within the industry.
B2.7 Vietnamese steel industry subsidisation

Orrcon identified in its application that the CBSA recently published findings of
countervailable subsidies from Vietnam. The CBSA investigation found that the following
subsidies were in place:244
 Program 1 – Exemptions of import duty

 Program 2 – Refunds of import duty
 Program 3 – Exemptions/Reductions of Land Rent, Tax and Levy
 Program 4 – Incentives on non-agricultural land use tax
 Program 5 – Export and import support in forms of preferential loan, guarantee and
factoring
 Program 6 – Enterprise income tax preferences, exemptions and reductions
238 The Nation Thailand, “Vietnam PM halts $10.6 billion steel plant”, 17 April 2017
239 Viet Nam News, “Steel masterplan drops 12 projects”, 12 December 2016, available at
https://vietnamnews.vn/economy/347832/steel-masterplan-drops-12-projects.html
240 Vietnam Net, “Vietnam’s steel production set for 2017 surge, 10 January 2017, available at
http://english.vietnamnet.vn/fms/business/170953/vietnam-s-steel-production-set-for-2017-surge.html
241 EPR 550, Item 36, p.279
242 EPR 550, Item 36, Exhibit 46
243 EPR 550, Item 36 Exhibit 23
244 CBSA numbering has been maintained.
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 Program 7 – Accelerated Depreciation of Fixed Assets

 Program 8 – Establishments Dealing with Exported Goods
 Program 9 – Investment support
 Program 10 – Export Promotion Program
 Program 11 – Grants to Firms that Employ More than 50 Employees
 Program 12 – Assistance to Enterprises Facing Difficulties for Objective Reasons
Each program was found to be specific by the CBSA and therefore countervailable.
In its investigation, the CBSA received no response from the GOV to its request for
information of the subsidies and so determined a subsidy rate on the facts available to it.
The CBSA calculated the subsidy margin based on the difference between the estimated
full costs of the subject goods, which are the costs of producing the goods plus allocated
SG&A, and the estimated export price of the goods as declared on import documentation.
From this, the CBSA calculated a subsidy margin of 6.5% for Vietnamese exports of cold-
rolled steel.
The Commission has undertaken its own investigation into alleged subsidies in Vietnam,
including those identified above. The Commission’s findings are detailed in chapter 7.9.2
and Non-confidential Appendix C3.1. The Commission concluded that the level of
subsidisation for all Vietnamese exporters is negligible.
B3 Competition in Vietnamese steel markets

In 2020, Vietnam imported 13.3 million tons of steel, compared to 9.85 million tons of
exports, valued at over USD$8 billion and USD$5 billion respectively.245 The high level of
import penetration indicates a high level of competition within the Vietnamese steel
market.
With HRC being the major raw material input for the goods, a comparison of costs paid by
verified Vietnamese exporters for Vietnamese HRC and HRC imported from other
countries provides an indication of the relative CTM of precision pipe and tube steel.
245 Vietnamese Steel Association, Vietnam steel market in January 2021, available at
http://vsa.com.vn/tinh-hinh-thi-truong-thep-viet-nam-thang-1-2021/
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Figure 24 – Weighted average HRC purchase prices by Vietnamese exporters
Figure 24 shows weighted average HRC purchase prices made by Vietnamese exporters
over the investigation period, by country of supply. This shows that for the majority of the
period, Vietnamese exporters paid a similar amount or slightly less for domestically
sourced HRC as they did for HRC from other countries, excluding China. Vietnamese
HRC costs were lower for 6 months of the investigation period. For 3 of those months,
prices were less than 3% lower than other country prices, and for the other 3 months,
prices were between 7% and 10% lower. However, over the course of the investigation
period, Vietnamese prices were 0.2% lower overall.
Based on the above, the Commission considers this indicates no significant advantage
exists for Vietnamese producers to use local materials, which would be evident if a
market situation existed.
B4 GOV influence on the Vietnamese precision pipe and tube

steel market
From the evidence available to it, the Commission does not consider that the GOV exerts
influence on the steel market in Vietnam such that domestic selling prices for precision
pipe and tube steel in Vietnam are unsuitable for use for determining a normal value
under section 269TAC(1).
In respect of the applicant’s assertion that the Steel Master Plans developed by the GOV
are evidence of GOV intervention, and following that, a market situation, the repeal of
these Master Plans, as documented through official Government decrees (Decision No.
4977/QD-BCT and Law on Planning No. 21/2017/QH14), renders these plans invalid from
2019 onwards. Given there exists no official Government plans to control or otherwise
influence the Vietnamese steel industry, no positive evidence of a continuing impact as a
result of the Steel Master Plans, no impact of distorted electricity prices on the CTM of the
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goods, negligible subsidisation of the goods and no evidence of significantly different

prices for raw materials in Vietnam compared to other Asian countries, the Commission is
satisfied there is no market situation that makes calculating the normal value for
Vietnamese exports under section 269TAC(1) inappropriate.
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APPENDIX C ASSESSMENT OF ALLEGED SUBSIDY PROGRAMS
C1 Introduction
C1.1 Definition of Government, public and private bodies
In its assessment of each program, the Commission has had regard to the entity
responsible for providing the financial contribution (if any) under the relevant program, as
part of the test under section 269T(1) for determining whether a financial contribution is a
subsidy. Under section 269T(1), for a contribution to be a subsidy, the contribution must
have been made by:
 a government of the country of export or country of origin of the goods; or

 a public body of that country or a public body of which that government is a
member; or
 a private body entrusted or directed by that government or public body to carry out
a governmental function.
C1.2 Government
As described in section 16.2 of the Manual, the Commission considers that the term
“government” is taken to include government at all different levels, including at a national
and sub-national level.
C1.3 Public bodies

The term “public body” is not defined in the Act. Determining whether an entity is a “public
body” requires evaluation of all available evidence of the entity’s features and its
relationship with government, including the following:
(1) The objectives and functions performed by the body and whether the entity in
question is pursuing public policy objectives. In this regard relevant factors include:
o legislation and other legal instruments,
o the degree of separation and independence of the entity from a government,
including the appointment of directors, and
o the contribution that an entity makes to the pursuit of government policies or
interests, such as taking into account national or regional economic
interests and the promotion of social objectives.
(2) The body’s ownership and management structure, such as whether the body is
wholly- or part-owned by the government or whether the government has a
majority of shares in the body. A finding that a body is a public body may be
supported through:
o the government’s ability to make appointments,
o the right of government to review results and determine the body’s
objectives, and
o the government’s involvement in investment or business decisions.
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The Commission considers this approach is consistent with the WTO Appellate Body
decision of United States – Countervailing Measures (China) 246 In that case the Appellate
body referred to the following three indicia which may assist in assessing whether an
entity was a public body vested with, or exercising, government authority:
 Where a statute or other legal instrument expressly vests government authority in

the entity concerned;
 Where there is evidence that an entity is, in fact, exercising governmental
functions; and
 Where there is evidence that a government exercises meaningful control over an
entity and exercises governmental authority in the performance of government
functions.
These principles have also previously been considered in the Federal Court of
Australia.247
C1.4 Private bodies

Where an entity is neither a government nor public body, the Commission will consider it
a private body, in which case, a government direction to make a financial contribution in
respect of the goods must be established in order for the contribution to be considered a
subsidy, as defined by section 269T(1).
Pursuant to section 16.3 of the Manual, in determining the character of an entity which
may have provided a financial contribution, the Commission will consider whether a
private body has been:
 “entrusted” to carry out a government function, which occurs when a government

gives responsibility to a private body; or
 “directed” to carry out a government function, which occurs in situations where the
government exercises its authority over a private body.
Accordingly, not all government acts will be considered as entrusting or directing a private
body. Encouragement or mere policy announcements by government, of themselves, are
not sufficient to satisfy this test. However, threats and inducements may be evidence of
entrustment or inducements. It is where the private body is considered a proxy by
government to give effect to financial contributions that this test will be satisfied.
246 DS379 United States – Definitive Anti-Dumping and Countervailing Duties on Certain Products from
China.
247 See; Panasia Aluminium (China) Limited v Attorney-General of the Commonwealth [2013] FCA 870, [27]
- [70]; Dalian Steelforce Hi Tech Co Ltd V Minister for Home Affairs [2015] FCA 885, [50] - [73]
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C2 Assessment of Programs – China

C2.1 Program 20 – Hot rolled steel provided by government at less than fair
market value
The Commission considers that its analysis in Appendix A describes how SOEs operate
in the Chinese steel market and industry. In particular, the analysis shows that:
 the Chinese steel industry is an industry of national strategic importance, which is

influenced by the GOC; and
 the Chinese steel industry is a vehicle to promulgate the government’s directives,
objectives, reforms and mission.
While the Commission notes that mixed-ownership reform is an ongoing feature of the
Chinese steel industry, the information before the Commission does not suggest that
mixed-ownership results in a greater degree of market orientation, which offsets or
diminishes the influence of the GOC when it is a shareholder.
The Commission considers that the GOC, as a shareholder in a steel mill, has direct
influence over the operations of that mill. As steel mills in China, regardless of ownership,
are already subject to the directives, plans and guidelines of the central government, the
Commission considers that the role of the GOC as shareholder serves to strengthen
compliance with, and serve the direction of, the central government.
In the absence of relevant information held, but not provided by the GOC, and in light of
all available information, the Commission concludes that Chinese steel mills, whether
wholly or partially owned by the GOC, possess, exercise and are vested with
governmental authority and are, therefore, public bodies.
In determining whether there has been a benefit provided under this program, the amount
of benefit received where there has been a provision of goods or services by the
government has been determined as the difference between the price paid by enterprises
for the government provided goods or service, and adequate remuneration for the product
or service in relation to prevailing market conditions.
Section 269TACC(4) provides that the adequacy of remuneration in relation to goods or

services is to be determined having regard to prevailing market conditions in the country
where those goods or services are provided or purchased.
The Commission considers that the prevailing market conditions for HRC (and other coil
types such as CRC and pre-galvanised coil derived from HRC) is the Chinese domestic
market for HRC, notwithstanding that the Commission has found that there is a market
situation in respect of HRC within the domestic Chinese market.
To determine the adequacy of remuneration, the Commission has compared data for
purchases of HRC in China from private companies against purchases from SOEs,
consistent with the approach outlined in Chapter 17 of the Manual.
The Commission found that prices offered to Dalian Steelforce by SOEs were lower than
prices offered by private companies. Accordingly, the Commission considers that a
benefit was conferred under this program, equal to the difference between the price paid
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by Dalian Steelforce for the government provided HRC and the price that would otherwise
have been paid to private suppliers.
The Commission is satisfied that Chinese manufacturers of the goods will have received
a subsidy under this program. The Commission considers this program is specific, as it is
only available to purchasers of HRC and other coil types derived from HRC.
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C2.2 Other Programs

No. Program name Evidence that program is still countervailable Countervailable?
1 Preferential Tax Policies for Enterprises with Foreign Notified during the review period by the GOC to the WTO in WTO Yes
Investment Established in the Coastal Economic Open Areas document G/SCM/N/220/CHN (Program 8).248
and Economic and Technological Development Zones
2 One-time Awards to Enterprises Whose Products Qualify for Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
‘Well-Known Trademarks of China’ and ‘Famous Brands of (Program 7).249
China’
5 Matching Funds for International Market Development for Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
Small and Medium Enterprises (Program 8).
Appears to have been notified during the review period by the GOC to the
WTO in G/SCM/N/220/CHN (Program 36).
6 Superstar Enterprise Grant Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 3).
7 Research & Development (R&D) Assistance Grant Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 10).
8 Patent Award of Guangdong Province Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 34).
10 Preferential Tax Policies for Foreign Invested Enterprises– Notified during the review period by the GOC to the WTO in Yes
Reduced Tax Rate for Productive Foreign Invested G/SCM/N/220/CHN (Program 1).
Enterprises scheduled to operate for a period of not less than
10 years
11 Preferential Tax Policies for Enterprises with Foreign Notified during the review period by the GOC to the WTO in Yes
Investment Established in Special Economic Zones G/SCM/N/220/CHN (Program 7).
(excluding Shanghai Pudong area)
12 Preferential Tax Policies for Enterprises with Foreign Notified during the review period by the GOC to the WTO in Yes
Investment Established in Pudong area of Shanghai G/SCM/N/220/CHN (Program 9).
248 See WTO document number G/SCM/N/220/CHN dated 30 October 2015.

249 Anti-Dumping Commission Report No. 316 (REP 316)
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13 Preferential Tax Policies in the Western Regions Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 3).
Notified during the review period by the GOC to the WTO in
G/SCM/N/220/CHN (Program 11).
14 Tariff and VAT Exemptions on Imported Materials and Notified during the review period by the GOC to the WTO in Yes
Equipment G/SCM/N/220/CHN (Program 61).
15 Innovative Experimental Enterprise Grant Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 11).
16 Special Support Fund for Non State-Owned Enterprises Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 12).
17 Venture Investment Fund of Hi-Tech Industry Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 13).
18 Grants for Encouraging the Establishment of Headquarters Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
and Regional Headquarters with Foreign Investment (Program 14).
19 Grant for key enterprises in equipment manufacturing Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
industry of Zhongshan (Program 15).
20 Hot rolled steel provided by government at less than fair A similar program in respect of steel billet raw material was countervailed Yes
market value by the Commission in 2016 in relation to steel grinding balls (Program 1).
In that case the Commission also found that SOEs producing steel raw
materials continue to be considered as ‘public bodies’ for the purposes of
the definition of subsidy in section 269(T) of the Act.250
The Commission has found that the GOC materially influenced conditions
within the Chinese HRC market during the review period (see Appendix
A). The Commission also found that HRC provided by Chinese SOEs was
less than the competitive market benchmark and therefore conferred a
benefit on HSS produced in China.
See Non-confidential Appendix C2.1.
250 Anti-Dumping Commission Report No. 316 at A3.3.1 and Appendix 5
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21 Water Conservancy Fund Deduction Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 16).
22 Wuxing District Freight Assistance Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 35).
23 Huzhou City Public Listing Grant Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 36).
27 Huzhou City Quality Award Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 37).
28 Huzhou Industry Enterprise Transformation & Upgrade Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
Development Fund (Program 38).
29 Land Use Tax Deduction Cooperating exporter declared receipt of a benefit under this program Yes
during the review period.
30 Wuxing District Public Listing Grant Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 39).
31 Anti-dumping Respondent Assistance Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 17).
32 Technology Project Assistance Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
(Program 18).
34 Balidian Town Public Listing Award The exporter that benefitted from this program during the original Yes
investigation (Kingland) is still exporting to Australia and did not make a
submission in relation to this program.
35 Preferential Tax Policies for High and New Technology Countervailed by the Commission in 2016 in relation to steel grinding balls Yes
Enterprises (Program 5).
Notified during the review period by the GOC to the WTO in
G/SCM/N/220/CHN (Program 6).
36 Local Tax Bureau Refund Financial contribution – a refund of government revenue to the recipient Yes
enterprise.
Benefit conferred – on all goods manufactured by the recipient enterprise.
Specificity – access is limited to enterprises within the jurisdiction of the
local tax bureau.
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37 Return of Farmland Use Tax Financial contribution – a refund of government revenue to the recipient Yes
enterprise.
local authorities.
38 Return of Land Transfer Fee Financial contribution – a refund of government revenue to the recipient Yes
enterprise.
local authorities.
39 Return of Land Transfer Fee From Shiyou Financial contribution – a refund of government revenue to the recipient Yes
enterprise.
local authorities.
40 Dining lampblack governance subsidy of Jinghai County Financial contribution – a direct transfer of funds to the recipient Yes
Environmental Protection Bureau enterprise.
Jinghai County Environment Protection Bureau.
41 Discount interest fund for technological innovation Financial contribution – a direct transfer of funds to the recipient Yes
enterprise.
Handan City Industry Bureau.
42 Energy conservation and emission reduction special fund Financial contribution – a direct transfer of funds to the recipient Yes
project in 2015 enterprise.
Daqiuzhuang Town Financial Bureau.
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43 Enterprise famous brand reward of Fengnan Finance Bureau Financial contribution – a direct transfer of funds to the recipient Yes
enterprise.
Fengnan District Science and Technology Bureau.
44 Government subsidy for construction Financial contribution – a direct transfer of funds to the recipient Yes
enterprise.
Handan City Local Tax Bureau.
45 Infrastructure Construction Costs Of Road In Front Of No.5 Financial contribution – a direct transfer of funds to the recipient Yes
Factory enterprise.
Jinghai County Local Tax Bureau.
46 New Type Entrepreneur Cultivation Engineering Training Fee Financial contribution – a direct transfer of funds to the recipient Yes
Of Jinghai County Science And Technology Commission enterprise.
Jinghai County Science and Technology Commission.
47 Subsidy for Coal-Fired Boiler of Fengnan Subtreasury Financial contribution – a direct transfer of funds to the recipient Yes
enterprise.
Fengnan District Environment Protection Bureau.
48 Subsidy for Coal-Fired Boiler Rectification Financial contribution – a direct transfer of funds to the recipient Yes
enterprise.
Handan City Environment Protection Bureau.
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49 Subsidy for District Level Technological Project Financial contribution – a direct transfer of funds to the recipient Yes
enterprise.
Daqiuzhuang Town Science and Technology Bureau.
50 Subsidy For Pollution Control Of Fengnan Environmental Financial contribution – a direct transfer of funds to the recipient Yes
Protection Bureau enterprise.
Fengnan District Environment Protection Bureau.
51 Subsidy from Science and Technology Bureau of Jinghai Financial contribution – a direct transfer of funds to the recipient Yes
County enterprise.
Jinghai County Science and Technology Bureau.
52 Subsidy of Environment Bureau transferred from Shiyou Financial contribution – a direct transfer of funds to the recipient Yes
enterprise.
Jinghai County Environment Protection Bureau.
550-2 Loan Interest Subsidy Financial contribution – a direct transfer of funds to the recipient Yes
enterprise.
Local Bureau of Foreign Trade and Economic Cooperation in Dalian.
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C3 Assessment of Programs – Vietnam

C3.1 Programs repealed as part of Vietnam’s accession to the WTO
The following programs were listed in the New and Full Notification Pursuant to Article
XVI.1 of the GATT and Article 25 of the Agreement on Subsidies and Countervailing
Measures published in March 2013 (2013 Vietnam Subsidy Notice).251 They were
repealed as part of Vietnam’s accession to the WTO in 2007. They are not listed in its
more recent New and Full Notification Pursuant to Article XVI.1 of the GATT and Article
25 of the Agreement on Subsidies and Countervailing Measures published in February
2020 (2020 Vietnam Subsidy Notice)252:
 Program 1 – Preferential Import Tariff Rates contingent upon Localisation Ratios

with respect to products and Parts of Mechanical-Electric-Electronic Industries
(updating Programme II of Notification of Subsidies period 2003-2004)
 Program 2 – Support for the Implementation of Projects Manufacturing Priority
Industrial Products (Updating Programme III of 2003-2004)
 Program 3 – Investment Incentives Contingent upon Export Performance For
Domestic Businesses (Updating Programme IV of 2003-2004)
 Program 4 – Other Investment Incentives for Domestic Businesses (Updating
Program V of Period 2003-2004)
 Program 5 – Investment Incentives Contingent upon Export Performance for
Foreign Invested Enterprises (Updating Programme VI of the Period 2003-2004)
 Program 6 – Other Investment Incentives for Foreign Invested Enterprises
(Updating Programme VII for Period 2003-2004)
 Program 7 – Preferential Investment Credit for Development Contingent upon
Export Criteria (Updating Programme VIII of Period 2003-2004)
 Program 8 – Preferential Development Credit for Investment Contingent Upon
Localisation Ratios (Updating Programme IX of Period 2003-2004)
 Program 10 – Export Promotion
 Program 12 – Support for Mechanical Products (Updating Program XV of Period
2003-2004)
 Program 13 – Support for Shipbuilding Industry (Updating of Programme XV of
Period 2003-2004)
 Program 14 – Assistance for Commercial Development in Mountainous, Island and
Ethnic Minority Areas (Updating Programme XVI of Period 2003-2004)
 Program 15 – Assistance to Enterprises Facing Difficulties due to Objective
Reasons
The Commission is satisfied that the above programs have ceased. The Commission did
not find any evidence during verification of any exporters being in receipt of a financial
benefit under any of these programs.
251 Available on the WTO website at

https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=q:/G/SCM/N155VNM.pdf&Open=True
252 Available on the WTO website at
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=q:/G/SCM/N284VNM.pdf&Open=True
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In light of the evidence before it, the Commission is not satisfied any Vietnamese exporter
received a financial benefit in connection with any of the above programs.
C3.2 Corporate Income Tax Programs

Corporate income taxation in Vietnam is governed by the Law Amending and
supplementing a number of articles of Law on Corporate Income Tax 2008 (the Amended
Law 2013) 253 and Decree 218/2013/ND-CP (Decree 218) detailing and guiding the
implementation of the Law on Corporate Income Tax. Pursuant to Article 1.6 of the
Amended Law 2013 and Article 10 of Decree 218254, the standard tax rate applicable for
corporate entities during the investigation period was 20%. The standard tax rate applies
to all entities, regardless of whether they are manufacturers or traders and regardless of
whether their products are steel pipes and tubes or not.
The following programs were identified by the Commission as providing possible

preferential treatment to exporters in respect of Vietnam’s corporate income tax:
 Program 18 – Incentives on corporate income tax for enterprises operating in

 Program 21 – Investment Support (consisting of two separate programs)
 Program 29 – Enterprise Income Tax Exemption/Reduction for Business
Expansion and Intensive Investment Projects
 Program 35 – Preferential Income Tax Rates for Enterprises within Economic
Zones or Industrial Parks
 Program 37 – Tax Exemptions and Reductions for Encouraged Sectors
 Program 39 – Tax Exemptions and Reductions for Investment in Disadvantaged
Regions
 Program 40 - Tax Exemptions and Reductions for Investments in Economic Zones
or High-Tech Industrial Parks
After reviewing the information provided for each program, the Commission has
determined that all programs provide for a similar benefit under the same legal basis, with
broadly similar eligibility criteria. Accordingly, the Commission considers it appropriate to
address each of these programs under Program 18.
Program 18 – Incentives on corporate income tax for enterprises operating in

It is alleged that this program provides corporate income tax incentives to enterprises
operating in certain regions or sectors in Vietnam.
Program 18 was not alleged in the application, but was identified and assessed by the
Commission in INV 370255 into zinc coated galvanised steel from India, Malaysia and
Vietnam.
253 EPR 550, Item 36, GOV REQ, Exhibit 4

255 Termination Report No. 370, p. 34. Available on the Commission website.
176
PUBLIC RECORD
Programs 21, 29, 35, 37, 39 and 40 were alleged in the following CBSA investigations:
 the subsidising of cold-rolled steel from China, South Korea and Vietnam (CBSA
Cold-rolled steel case);
 the subsidising of certain copper pipe fittings originating in the Socialist Republic of
Vietnam (CBSA Copper Pipe case);
 the subsidising of certain corrosion-resistant steel sheet originating in Turkey, the
United Arab Emirates and Vietnam (CBSA COR case);
 the subsidising of certain oil country tubular goods originating in or exported from
India, Indonesia and Vietnam (CBSA Oil Tubes case).
Eligibility criteria
Eligible regions and sectors for incentives under this program are identified in Article 15 of
Decree 218 or Appendix II to Decree 118/2015/ND-CP (Decree 118).
Article 15 of Decree 218 provides a broad list of areas of eligibility, based on region,
areas of new investment and levels of new investment. 256
Is there a subsidy?
The general corporate tax rate for the investigation period was 20%. Eligible entities may
receive under this program preferential tax rates ranging from 10% to 17%.
The Commission considers that the laws governing this program provide for a financial
contribution by the GOV to eligible entities, being the foregoing of revenue, varying
depending on which eligibility criteria have been met, which would be otherwise payable
to the GOV by those entities.
As the deduction is available for income derived from export activities (among other
things), the Commission considers that a financial contribution under this program would
be made in connection with all exports of goods.
Where received, this financial contribution is considered to confer a benefit because of

the savings realised by the entity in not having to pay the full amount of tax on such
income, which would otherwise be payable.
Where exporters of the goods have received a deduction under this program during the
investigation period, that deduction confers a benefit in relation to the goods and the
financial contribution satisfies the definition of a subsidy under section 269T.
The Commission has determined that all Vietnamese cooperating and residual exporters
did not receive a benefit under this program and paid the full rate generally payable.
However, based on information provided by the GOV, the Commission has determined
that uncooperative exporters may be in receipt of a benefit under this program.
Is the subsidy countervailable?
256 Refer to Decree 218 for full detail of eligibility criteria.
177
PUBLIC RECORD
A subsidy is a countervailable subsidy if it is specific. Specificity is defined under section

269TAAC. Section 269TAAC(2)(b) provides that a subsidy is specific if, subject to section
269TAAC(3), it is limited to entities carrying on business within a designated geographical
region.
The Commission is satisfied this program provides an exemption based on, among other
things, the geographical location of entities, thereby satisfying the criteria in section
269TAAC(2)(b).
Section 269TAAC(3) provides that a subsidy is not specific, subject to section

269TAAC(4), if:
(a) eligibility for, and the amount of, the subsidy are established by objective criteria or conditions
set out in primary or subordinate legislation or other official documents that are capable of
verification; and
(b) eligibility for the subsidy is automatic; and
(c) those criteria or conditions are neutral, do not favour particular enterprises over others, are
economic in nature and are horizontal in application; and
(d) those criteria or conditions are strictly adhered to in the administration of the subsidy.
The Commission has examined the eligibility criteria for the program and considers that
eligibility is established by objective and verifiable criteria set out in the Amended Law
2013, Decree 118 and Decree 218. There is no application process to apply for the
subsidy, with responsibility for seeking a benefit under the program resting with entities as
part of their payment of tax. However, the taxation preferences available under the
program are only available to certain sectors and locations as identified in Decree 118
and Decree 218.
Accordingly, having considered the factors set out in section 269TAAC(4), the
Commission is not satisfied that the requirements of section 269TAAC(3) have been met,
therefore any subsidy available under this program is countervailable.
Amount of subsidy
Benefits for income tax programs are expensed to the year in which the benefit is
received, and the benefit is taken to have been received on the date on which the entity
would otherwise have had to pay the taxes associated with the exemption.257 Accordingly,
the Commission has determined that any amount deductable under this program in
relation to the investigation period (or a portion thereof) is to be attributed to the
Non-cooperative entities
The Commission has determined that uncooperative exporters received a benefit under
this program during the investigation period, in accordance with section 269TACC(3)(b).
257 Part 17.3 of the Manual, p. 93
178
PUBLIC RECORD
In accordance with section 269TACD(1), the amount of the subsidy has been determined.
The Commission considers that non-cooperative entities in Vietnam may have received
the most favourable preferential rate of 10% during the investigation period.
This percentage has then been applied to the weighted average verified taxable income
of the cooperating exporters for the investigation period.
In accordance with section 269TACD(2), this amount has then been apportioned to each
unit of the goods using the value of all products produced by each company during the
C3.3 Import duty preferences

The following programs were identified by the Commission as providing possible
exemptions to the payment of import duties for Vietnamese exporters:
 Program 17 – Preferential Import Tariff Rates for enterprises investing in regions or

sectors entitled to investment incentives
 Program 32 - Exemption of Import Tax on Equipment and Machinery Imported to
Create Fixed Assets
 Program 42 – Excessive Duty Exemptions for Imported Raw Materials for Exported
Goods
 Program 43 – Exemptions of Import Duty
 Program 44 – Refund of Import Duty
Program 17 was not alleged in the application, but was identified and assessed by the
Commission in INV 370. Programs 32, 42, 43 and 44 were alleged in the application,
based on findings in the in the CBSA Copper Pipe case, the CBSA Cold-rolled steel case
and the CBSA Oil Tubes case.
Legal basis
In its RGQ, the GOV submitted that import duty preferences available under Programs
17, 32 and 43 are subject to the same governing legislation and therefore provided a
single response for all three programs. The Commission confirmed during the
investigation that these programs were established under the Law 107/2016/QH13 on
export and import duties (Law 107)258 and Decree 134/2016/ND-CP providing guidelines
for the Law on export and import duties (Decree 134)259.
The Commission also confirmed that Programs 42 and 44, for which the GOV has also
provided a combined response, were governed by Law 107 and Decree 134.
WTO notification
Preferential policies on import tax under Law 107 and Decree 134 are included in the
2020 Vietnam Subsidy Notice.
258 Law 107 replaced the Law on Import Duty and Export Duty, No. 45/2005/QH11, which was the governing
legislation for Program 17 in INV 370. Available on EPR 550, Item 36, GOV RGQ, Exhibit 22
259 EPR 550, Item 36, GOV RGQ, Exhibit 37
179
PUBLIC RECORD
Programs 17 and 32 – Preferential Import Tariff Rates
Articles 14 and 15 of Decree 134 provide for exemption of duties on imported fixed
assets, raw materials, supplies and components for eligible investments. These are set
out in Appendices I and II to Decree 118 and clause 11 of Article 16 of Law 107. This
includes, among other things, investments in specified regions with deductions for
“Machinery and equipment; components, parts, spare parts for assembly or operation of
machinery and equipment; raw materials for manufacture of machinery and equipment,
components, parts, or spare parts of machinery and equipment”.
Is there a subsidy?
contribution by the GOV to eligible entities, being the foregoing of revenue which would
be otherwise payable to the GOV by those entities.
As the exemption of import duty is available for machinery which may be used in
connection with export activities (among other things), the Commission considers that a
financial contribution under this program would be made in connection with all exports of
goods.
Where received, this financial contribution is considered to confer a benefit because of

the savings realised by the entity in not having to pay the full amount of import duty which
would otherwise be payable.
Where exporters of the goods have received an exemption under this program during the
investigation period, that exemption confers a benefit in relation to the goods and the
financial contribution satisfies the definition of a subsidy under section 269T.
The GOV advised that no exporter of the goods was in receipt of any benefit under this
program.
The Commission did not find any evidence during verification of any exporters being in
receipt of a financial benefit under this program.
In light of the evidence before it, the Commission is not satisfied any Vietnamese exporter
received a financial benefit in connection with this program.
Programs 42, 43 and 44 – Refund of Import Duty
Any exporter may apply to use the program.
Exporters must provide the following information to the GOV to receive a benefit under
the program:
 Prior to the first import of raw materials, inform the GOV about its production
facility, including storage arrangements for imported materials, finished export
goods and installed manufacturing equipment and machinery;
 Maintain certain records regarding material consumption for each raw material
type, required material to produce a unit of the relevant exported good, and rates
of loss in production, including waste;
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 Provide reports on stock in, stock out for manufacturing and leftovers of imported
materials for each finished product code, which is to be reconciled to finance
documentation;
 Following export, the producer submits documentation to the GOV seeking a
refund of the relevant import duty paid, including various evidence on payment for
imported goods, import/export contracts, duties paid, and in respect of the
manufacturing facilities.
Is there a subsidy?
Import duty exemptions are provided on imported raw materials used in the production of
exported goods. The exemption amount is the amount of the duty corresponding to the
value of imported materials actually used in the processing of the exported goods.
Section 17.3 of the Manual – Remission or drawback of import charges upon export
provides that, in the case of an exemption of import charges upon export, such as
provided under this program, a benefit exists to the extent that the exemption extends to
inputs that are not consumed in the production of the exported product (making normal
allowances for waste) or if the exemption covers charges other than import charges
imposed on the input. The amount of the benefit will be the import charges that otherwise
would have been paid on the inputs not consumed in the production of the exported
product and the amount of charges other than import charges covered by the exemption.
However, the Commission may determine that the entire exemption amount constitutes a
benefit if the foreign government has not examined the inputs in order to confirm that
such inputs are consumed in the production of the exported goods, in what amounts, and
the taxes that are imposed on the inputs. If it is found that there is a system in place that
confirms this information, the Commission will examine that system to see if it is
reasonable.
Based on the GOV RGQ and the provisions of Law 107 and Decree 134, the Commission
has determined that the GOV has a system in place for monitoring compliance under this
program as follows:
 Details on production facilities used to produce exported goods are provided to the
GOV, including information on the storage or raw materials, machinery used in
production and details on the exported products;
 Facilities are inspected where necessary to verify information provided by
producers;
 Reports on use of raw materials submitted by exporting producers are reconciled
against financial reports;
 Customs post-clearance examination of exporters may be carried out where any
information provided is suspect.
The Commission is satisfied from the information available that the GOV has in place a
reasonable system for confirming which inputs are consumed in the production of the
exported goods, in what amounts, and the taxes that are imposed on those inputs. The
Commission is also satisfied that the system in place ensures that import duty refunds are
only provided for those inputs consumed in the production of exported goods.
Accordingly, consistent with the approach set out in the Manual, the Commission is
satisfied that no subsidy is provided under this program.
181
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C3.4 Other Programs

Program 11: Trade Promotion
The applicant requested that a program known as “Trade Promotion (Updating of

Programme XIII of Period 2003-2004)” be included as part of the investigation into
countervailable subsidies.
The basis for the applicant’s request was the inclusion of the program in the 2013
Vietnam Subsidy Notice. The 2013 Vietnam Subsidy Notice states that this program was
terminated in 2006 and is not included in the 2020 Vietnam Subsidy Notice.
However, the GOV has advised that a Trade Promotion program is still available. Eligible
organisations may apply under the program for government funding to engage in trade
promotion activities, such as participation in trade delegations.
Legal basis
The current iteration of the program is governed by the following legislation:
 Decision 5016/QD-BCT dated 27 December 2018; and

 Decision 72/2010/QD-TTg dated 15 November 2010.260
WTO notification
The program is not included in the most recent WTO notification.
The Commission understands that this program is available to all Vietnamese enterprises,
cooperatives and trade promotion organisations, for export and domestic promotion. In
respect of export trade, applications are submitted to the Minister of Industry and Trade
for funding in the following areas:
 market research;
 advertising;
 hire domestic and foreign experts to give advice on product development,
enhancement of product quality, export development and entering foreign markets;
 internal and external short-term training courses in trade promotion;
 organise and participation in trade fairs;
 trade delegations; and
 other trade promotion activities.
Is there a subsidy?
contribution by the GOV to eligible entities, by way of a direct grant paid to recipients.
182
PUBLIC RECORD
From the information provided by the GOV, the Commission has determined that CDI and
its related trading entity, CDT, have received a benefit under this program during the
investigation period, by way of a direct grant in respect of a trade delegation to Korea. It is
noted that CDI did not provide any details in respect of its receipt of funding under this
program. However, the Commission is satisfied that any contribution received by CDI
under this program is not in respect of the export of the goods to Australia.
In light of the above, the Commission has determined that no subsidy was provided under
this program in respect of the goods during the investigation period.
Program 23 - Export & Import Support in the Form of Preferential Loans,

Guarantees, and Factoring (consisting of five separate programs)
The existence of the five separate programs below were alleged in the CBSA Cold-rolled
steel case and the CBSA COR case:
(a) Interest rate support program under the State Bank of Vietnam
(b) Preferential Lending to Exporters
(c) Export Factoring
(d) Financial Guarantees by VietinBank and VietcomBank for Export Activity
(e) Export and Import Support in Forms of Preferential Loan, Guarantee and Factoring
In its investigations, the CBSA combined these five programs into one, on the basis they
were very similar.
The GOV advised in its RGQ that sub-programs (b), (c) and (e) relate to the provision of
credit to exporters by Vietnam Development Bank and has relied upon its response to
Programs 24 and 26 in addressing these elements of the program. The Commission has
also adopted a combined approach with these sub-programs, which are addressed under
Program 24.
The GOV addressed sub-program (a) in its response to Program 25 and the Commission
has done the same.
Accordingly, the Commission’s examination of Program 23 is limited to sub-program (d) –

“Financial Guarantees by VietinBank and VietcomBank for Export Activity”.
The GOV submitted in its response that Vietinbank and Vietcombank are commercial joint
stock banks and are not run by the GOV or any Vietnamese public body. It notes that
both banks are subject to the Law on Credit Institution 2010 and the Law on Amendments
to Some Articles of the Law on Credit Institutions 2017, Article 7 of which provides that
credit institutions “…have autonomy in their business activities and take accountability for
their business results.” 261 As a result, the GOV has not provided a substantive response
on this program.
VietinBank
The Commission has found for the investigation period, VietinBank was majority owned
by the GOV, through the State Bank of Vietnam, which is the central bank of Vietnam.
261 EPR 550, Item 36, GOV RGQ, p.169
183
PUBLIC RECORD
VietinBank’s 2019 Annual Report indicates 64.46% of its shares are owned by the State
Bank of Vietnam.262
The report emphasises VietinBank’s role as “…the pioneering bank in implementing

policies of the Government and the [State Bank of Vietnam] and contributed significantly
to the country’s socio-economic development.”263 It also cites examples of where
VietinBank has acted to implement GOV policy, including:
 prioritising a large proportion of loans to [the] manufacturing sector, as encouraged

by the GOV and the State Bank of Vietnam;264 and
 initiating programs to promote socio-economic development in priority areas
guided by the Government, which includes an interest rate ceiling for short-term
loans of 6%.265
After considering Non-confidential Appendix C1.3, the Commission has determined that
VietinBank is a public body, due to the contribution it makes to the pursuit of GOV policies
and its majority ownership by the State Bank of Vietnam.
VietcomBank
The Commission has found for the investigation period, VietcomBank was 74.8% owned
by the GOV, with the shares held through the State Bank of Vietnam.266 Through its
shareholding, the GOV has appointed both the chairman of the board and the Chief
Executive Officer.
VietcomBank’s 2019 Annual Report refers to it “proactively implementing policies of

government and [the State Bank of Vietnam]” including measures to support domestic
enterprises through the reduction of loan interest pursuant to government guidance and
government direction.267
The report notes that the Ministry of Finance and the State Bank of Vietnam, through the
GOV shareholding in VietcomBank, are related parties.268
After considering Non-confidential Appendix C1.3, the Commission has determined that
VietcomBank is a public body, due to the contribution it makes to the pursuit of GOV
policies, it being majority owned by the GOV and the control of the GOV over
appointments to the board and management.
Background
The Commission understands that under this program, VietinBank and VietcomBank
provide guarantees on behalf of customers to fulfil the financial requirements of those
262 VietinBank 2019 Annual Report, p.67, available at: https://www.vietinbank.vn/sites/mediafile/VTB149105

263 Ibid, p.14
264 Ibid, p.75
265 Ibid, p.116
266 VietcomBank 2019 Annual Report, p.56, available at: https://portal.vietcombank.com.vn/content/en-
us/Investors/Investors/Annual%20Reports/Year%202019/20200730_AR_Vietcombank2019_English.pdf
267 Ibid
268 Ibid, p.173
184
PUBLIC RECORD
customers in the event that they are unable to meet fully their financial commitments. It is
alleged that this guarantee provides a financial benefit to their customers in that they are
able to obtain credit at a lower level than would be otherwise available, with the benefit
being the difference between the interest rate they are able to obtain with the aid of the
guarantee, compared to the interest rate they would have otherwise been entitled.
Legal basis
The CBSA in its investigation of this program, when combined with the four other sub-
programs, found the legal basis for the program to be Decree No. 75/2011/ND-CP153
dated August 30, 2011, on state investment credit and export credit (Decree No. 75)269
and Decree No. 151/2006/ND-CP154 dated December 20, 2006, on state investment
credit and export credit (Decree No. 151).270
The Commission notes that Decree No. 75 replaced Decree No. 151, which was itself
repealed in 2017 pursuant to Decree 32/2017/ND-CP. 271
The Commission is not aware of any other legislation requiring VietinBank and
VietcomBank to provide preferential guarantees. However, the involvement of both banks
in the implementation of GOV policy, as indicated in their annual reports, suggests that
such guarantees may be made.
WTO notification
None
The Commission is not aware of any eligibility for this program.
Is there a subsidy?
Section 269TACC(3)(c) provides that, when determining whether a financial contribution

has conferred a benefit, the guarantee of a loan by a government or public body does not
confer a benefit unless the recipient of the guarantee is required to repay on the loan a
lesser amount than would have been required under a comparable commercial loan
without a guarantee.
The Commission has undertaken an analysis of the information provided by cooperating

and residual exporters in relation to loans they have sourced from VietinBank and
VietcomBank, privately owned banks and government owned banks operating on a
commercial basis. The Commission established that interest rates differed between
exporters and between banks, which it considers indicative of financial institutions setting
lending rates based on commercial risk assessments, which is a fundamental tenet of a
functioning financial market.

185
PUBLIC RECORD
The Commission has used interest rate data from privately owned banks and government
owned banks operating on a commercial basis for short-term loans (as these were the
only loans found to be provided by VietinBank and VietcomBank), weighted by the value
of each loan, to establish a benchmark of market rates against which loans from
VietinBank and VietcomBank can be compared over the investigation period.
The Commission considered this basis for the calculation of a benchmark rate more
appropriate than the rate offered by the State Bank of Vietnam as it more accurately
represents rates actually available to exporters in the market.
The Commission has determined the differential between this benchmark rate and the
rate actually charged at the time the loan was sourced from VietinBank and VietcomBank
as a subsidy available under this program, as defined by section 269T.
The Commission’s analysis is at Confidential Attachment 33.
Is the subsidy countervailable?
A subsidy is a countervailable subsidy if it is specific. Specificity is defined under section

269TAAC. Section 269TAAC(2) provides that a subsidy is specific if, subject to section
269TAAC(3):
(a) it is explicitly limited to particular entities;

(b) it is limited to entities carrying on business in a designated geographical region;
(c) it is contingent on export performance; or
(d) it is contingent on the use of domestically produced goods over imported goods.
The CBSA COR case, which was the basis for alleging that a countervailable subsidy was
provided under this program, referred only to legislation which has since been repealed.
No examination was made by the CBSA of the terms and eligibility criteria under which
guarantees from VietinBank and VietcomBank were provided. The GOV RQQ also does
not address this, on the basis that VietinBank and VietcomBank are not public bodies.
The Commission has examined information provided by the cooperating exporters for
loans provided by VietinBank and VietcomBank. However, this did not indicate any
specific eligibility criteria.
From the information before it, the Commission does not have any evidence indicating
that guarantees offered by VietinBank and VietcomBank satisfy any of the criteria of
section 269TAAC(2). Accordingly, the Commission considers that any benefit received
under this program is not countervailable.
186
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C3.5 Remaining programs where no subsidy was found

Program Program Name Background Legal basis under WTO notification Eligibility criteria Commission
Number Vietnamese Law assessment
The application referred to this Decree 32/2017/ND-CP This program, was The program is limited to The GOV advised that
program as detailed in New and dated May 15, 2017.272 listed in the “New investment projects no exporter of the
Full Notification Pursuant to and Full identified in Decree goods was in receipt of
Article XVI.1 of the GATT and Notification 32/2017/ND-CP. any benefit under this
Article 25 of the Agreement on Pursuant to Article Eligible borrowers wishing program.
Subsidies and Countervailing XVI.1 of the GATT to receive benefits under The Commission did
Measures” published in March and Article 25 of this program are required not find any evidence
2013. That iteration of the the Agreement on to follow Vietnam during verification of
program ceased in 2007. Subsidies and Development Bank’s any exporters being in
However, since 2017, the Countervailing regulations and receipt of a financial
program has continued. Under Measures” procedures of providing benefit under this
Other Preferential the program, the Vietnam published in investment loan. program.
Investment Credit for Development Bank provides March 2013.
Eligible projects must In light of the evidence
Development (Updating state investment loans to Despite still relate to socio-economic before it, the
Program X of Period eligible projects. Eligible running, the infrastructure, agriculture Commission is not
2003-2004) projects must relate to socio- program is not and industry, which satisfied any
9 economic infrastructure, listed in the more includes: Vietnamese exporter
agriculture and industry, none of recent “New and received a financial
Current iteration: “Other which directly related to the Full Notification  pharmaceuticals
Preferential Investment  power supply benefit in connection
goods. Pursuant to Article with this program.
for Development, May XVI.1 of the GATT  key mechanical
2017” and Article 25 of products designated
the Agreement on by the prime minister
Subsidies and  energy efficiency
Countervailing  supporting industries
Measures” designated by the
published in prime minister
February 2020.  agriculture machinery
 clean technology
 hi-tech products
 certain geographic
areas
 off-shore projects.
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It is alleged that this program, Established under This program, was A broad range of scientific The Commission is
which ceased in 2014, provided Decree 119/1999/ND-CP listed in the 2013 and technology activities satisfied that changes
corporate tax preferences dated 18 September Vietnam Subsidy by domestically or foreign to the corporate
depending on whether entities 1999.273 Notice. owned enterprises were income tax law in 2003
were domestic and foreign This program has eligible for this program. led to the removal of
Repealed in various
owned. Such preferences not been listed in differences in tax
stages from 2003 to
included: Vietnam’s “New treatment between
2014 pursuant to:
 Domestic enterprises were and Full domestic and foreign
 The Law on owned entities and the
granted preferences in Notification
Corporate Income Pursuant to Article resulting termination of
relation to land rent/use
fees Tax 2003274 XVI.1 of the GATT many parts of this
 Decree and Article 25 of program. Preferences
 Import duty exemptions in relation to
142/2005/ND-CP the Agreement on
Incentives for  Investment credit Subsidies and Investment credit were
dated 14 November
Investment Projects in  Financial support for Countervailing replaced with Other
Science and scientific and technology 2005.275 Preferential Investment
16 Measures” since
Technology (Updating research.  Decree September 2015. for Development, May
Programme XVIII of 149/2005/ND-CP 2017 (see Program 9).
Period 2003-2004) dated 8 December The remainder of the
2005276 program was
terminated in 2014.
 Decree
08/2014/ND-CP The Commission did
dated 27 January not find any evidence
during verification of
2014277 any exporters being in
receipt of a financial
benefit under this
program.
In light of the evidence
before it, the
Commission is not
satisfied any

274 Ibid.
275 Ibid.
276 Ibid.
277 Ibid.
188
PUBLIC RECORD
Vietnamese exporter
received a financial
benefit in connection
with this program.
It is alleged that under this Law on Non-Agricultural None Appendix 1 of Decree No. The GOV advised that
program, tax incentives are Land Use Tax 118/2015/ND-CP defines no exporter of the
provided for non-agricultural 48/2010/QH12278 and sectors eligible for goods was in receipt of
land us. Decree investment promotion and any benefit under this
The existence of this program 53/2011/ND-CP279 sectors eligible for special program.
was alleged in the CBSA Cold- implementing this Law. investment preferences. The Commission did
rolled steel case, the CBSA Appendix 2 defines areas not find any evidence
Non-agricultural land use with extreme socio-
Copper Pipe case and the tax benefits including tax during verification of
CBSA COR case. economic difficulties and any exporters being in
exemption and reduction areas with socio-
are provided under receipt of a financial
Incentives on non- economic difficulties benefit under this
19 Article 9 and 10 of the eligible for investment
agricultural land use program.
Law and Article 8 of preferences.
Decree 53.280 In light of the evidence
before it, the
There is no separate Commission is not
application process. satisfied any
Taxpayers are Vietnamese exporter
responsible for calculating received a financial
their tax liability in benefit in connection
accordance with the with this program.
relevant tax law and
regulations.
It is alleged that this program, The GOV advised in its None Investment projects of any The basis for alleging
which ceased in 2006, provides RGQ that there has production and business the existence of this
Grants to Firms that various forms of investment never been a grant sectors that had an program is CBSA
20 Employ More than 50 preferences and support for program as described. average number of at investigations in 2018,
Employees firms employing more than 50 Rather, this program, least 50 employees was which found the
employees. established under eligible for investment program was
Decree terminated in 2006.

279 Ibid.
280 EPR 550, Item 36, GOV REQ, Exhibits 23 and 27
189
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The existence of this program 51/1999/ND-CP281 is an incentives. These The Commission has
was alleged in the CBSA Cold- incentive program. This included: been provided
rolled steel case and the CBSA establishing legislation is  3-year exemption of evidence by the GOV
Copper Pipe case. the same identified in the land rent confirming that the
In both investigations, based on CBSA investigations.  2-year exemption of program was
the information before it, the income tax with a terminated in 2006.
The program was
CBSA found the program to be terminated in 2006 by 50% reduction for the The Commission did
specific because it is limited to Decree subsequent 2 years. not find any evidence
particular enterprises with a 108/2006/NDCP.282 during verification of
certain size. The CBSA also any exporters being in
found that the last date a receipt of a financial
company could apply for a benefit under this
benefit under this program was program.
2006. In light of the evidence
before it, the
Commission is not
satisfied any
Vietnamese exporter
with this program.
The existence of this program The GOV advised in its None N/A The basis for alleging
was alleged in a 2015 REQ that there is no the existence of this
investigation by the CBSA into case of acquisition of program is a CBSA
the subsidising of certain oil state assets at less than finding based on the
country tubular goods fair market value. non-response of
Acquisition of State
originating in or exported from The GOV advised that Vietnamese exporters
22 Assets at Less Than
the Republic of India, the the sale of state assets during its investigation.
Fair Market Value
Republic of Indonesia and the of property is required The Commission notes
Socialist Republic of Vietnam. under Articles 4 and 6 of that the CBSA
During its investigation, no the Law on Property investigation did not
exporter in Vietnam provided Auction dated 17 find positive evidence
sufficient information to the of the existence of this

282 Ibid.
190
PUBLIC RECORD
CBSA to determine an amount November 2016283 to be program or of any
of subsidy. Therefore, the auctioned in an benefits received.
amount of subsidy for all independent, honest, The Commission has
Vietnamese exporters was public, transparent, been provided
determined in accordance with equal and objective way. evidence by the GOV
a ministerial specification, indicating that this
pursuant to which the CBSA program does not
found that all programs were exist, and that it is
countervailable. contrary to existing
No further information was legislation.
provided to the Commission in The Commission did
respect of this program. not find any evidence
during verification of
any exporters being in
receipt of a financial
benefit under this
program.
before it, the
Commission is not
satisfied any
Vietnamese exporter
with this program.
It is alleged that under this Established under Article None Article 16 of Decree 75 The basis for alleging
program, Export credit or 16 of Decree identified certain exporting the existence of this
Export Support Loans at preferential lending for exporter 75/2011/ND-CP.284 sectors eligible for lending program is a CBSA
24 was provided to certain sectors from the Vietnam finding based on the
Preferential Rates Repealed in 2017 under
by the Vietnam Development Development Bank. non-response of
Article 28 of Decree
Bank. Eligible borrowers were These sectors are Vietnamese exporters
offered export credit amount up 32/2017/ND-CP. 285 during its investigation.

285 Ibid.
191
PUBLIC RECORD
to 85% of the value of the provided under Appendix The Commission notes
export contract at preferential II of Decree 75. that the CBSA
interest rates. investigation did not
The existence of this program find positive evidence
was alleged in the CBSA Oil of the existence of this
Tubes case. program or of any
benefits received.
During its investigation, no
exporter in Vietnam provided The Commission has
sufficient information to the been provided
CBSA to determine an amount evidence by the GOV
of subsidy. Therefore, the indicating that this
amount of subsidy for all program no longer
Vietnamese exporters was exists.
determined in accordance with The Commission did
a ministerial specification, not find any evidence
pursuant to which the CBSA during verification of
found that all programs were any exporters being in
countervailable. receipt of a financial
benefit under this
program.
before it, the
Commission is not
satisfied any
Vietnamese exporter
with this program.
It is alleged that this program The program was None This program was The basis for alleging
provided various levels of implemented to provide available to enterprises of the existence of this
interest rate support depending short-term support all manufacturing sectors. program is a CBSA
on the length of the loan. following the 2009 global finding based on the
Interest Rate Support financial crisis. The non-response of
25 Program under the The existence of this program
was alleged in the CBSA Oil program was established Vietnamese exporters
State Bank of Vietnam under: during its investigation.
Tubes case.
The Commission notes
During its investigation, no that the CBSA
exporter in Vietnam provided investigation did not
sufficient information to the
192
PUBLIC RECORD
CBSA to determine an amount  Decision 131/QD- find positive evidence
of subsidy. Therefore, the TTg, dated January of the existence of this
amount of subsidy for all 23, 2009286 program or of any
Vietnamese exporters was benefits received.
determined in accordance with  Decision 443/QD-
TTg, dated April 4, The Commission has
a ministerial specification, been provided
pursuant to which the CBSA 2009287
evidence by the GOV
found that all programs were  Decision 2072/QD- indicating that this
countervailable. TTg, dated program no longer
December 11, exists.
2009288 The Commission did
 Circular not find any evidence
05/2009/TT-NHNN during verification of
dated 4 July any exporters being in
2009289 receipt of a financial
benefit under this
 Circular program.
04/2009/TT-NHN
dated 13 March In light of the evidence
before it, the
2009290 Commission is not
The final date for satisfied any
receiving support under Vietnamese exporter
the program was 31 received a financial
December 2012, 24 benefit in connection
months after the final with this program.
disbursement of loans in
2010.
Preferential Lending See Program 24
26 under the Viet Bank
Export Loan Program

288 Ibid.
289 Ibid.
290 Ibid.
193
PUBLIC RECORD
It is alleged that under this Accelerated depreciation None Under Circular The Commission
program, any Vietnamese of fixed assets is 45/2013/TT-BTC, all considers that this
enterprise operating with “high available under Circular enterprises operating in program is not specific
economic efficiency” may 45/2013/TT-BTC.291 Vietnam are eligible for as it is available to all
accelerate their depreciation up this program, if they are enterprises established
to double the normal rate, for operating with “high and operating in
fixed assets involved in economic efficiency”. Vietnam and is
business activities including therefore not
machinery and equipment, countervailable.
Accelerated experimental and measuring
27 Depreciation of Fixed instruments, equipment and
Assets means of transport,
management tools, animals,
perennial orchards.
The existence of this program
was alleged in four separate
investigations by the CBSA: the
CBSA COR case, the CBSA
Cold-rolled steel case, the
CBSA Copper Pipe case and
the CBSA Oil Tubes case.
It is alleged that this program, Established under Investment This program was limited The CBSA re-
repealed in 2006, provided Chapter 5 of Decree incentives to sectors identified in examined this program
income tax preferences to 164/2003/ND-CP292, contingent on Annex A to Decree in the CBSA COR case
exporters. detailing the export 164/2003/ND-CP, which in 2019 and
Additional Income Tax The existence of this program implementation of the performance included exporters with an determined it was
28 Preferences for was alleged in the CBSA Oil Law on Corporate under Decree export value of more than covered under other
Exporters Tubes case, which was Income Tax.293 164/2003/ND-CP 50% of their total subsidy programs
conducted in 2015. During its and the repeal of production value. examined by the CBSA
Repealed in 2006 that program in respect of Vietnam.
investigation, no exporter in pursuant to Decree
Vietnam provided sufficient under Decree The Commission is
information to the CBSA to 108/2006/ND-CP.294 108/2006/ND-CP satisfied that this
were included in

194
PUBLIC RECORD
determine an amount of the 2013 Vietnam program ceased in
subsidy. Therefore, the amount Subsidy Notice. 2006.
of subsidy for all Vietnamese It is not included in The Commission did
exporters in that case was the 2020 Vietnam not find any evidence
determined in accordance with Subsidy Notice. during verification of
a ministerial specification, any exporters being in
pursuant to which the CBSA receipt of a financial
found that all programs were benefit under this
countervailable. program.
before it, the
Commission is not
satisfied any
Vietnamese exporter
with this program.
The existence of the 7 separate Income Tax Preferences Various Income tax preferences The Commission is
programs below were alleged in under Chapter V of preferential were only available to satisfied this program
the CBSA Cold-rolled steel Decree policies on certain sectors and is no longer in force
case: corporate income geographical areas. and has been replaced
24/2007/ND-CP295,
(a) Enterprise Income Tax tax are included in by Decree
which was repealed by
Enterprise Income Tax preferences, exemptions the 2020 Vietnam 218/2013/ND-CP,
Income Tax Preferences Subsidy Notice. which is discussed
Preferences, and reductions under Chapter IV of under Program 18.
Exemptions, and (b) Enterprise Income Tax
30 Decree
Reductions (consisting exemptions and reductions No exporters were
of seven separate for business expansion and 124/2008/ND-CP296. identified as having
programs) intensive investment Decree 124/2008/ND-CP received benefits
(c) Enterprise income tax and was later repealed by under this program.
import duty preferences Decree 218/2013/ND- In light of the evidence
(d) Tax preferences for before it, the
CP.297
investors producing and/or Commission is not
dealing in export goods satisfied any

297 EPR 550, Item 36, GOV REQ, Exhibits 2, 9 and 32
195
PUBLIC RECORD
(e) Income Tax Preferences Vietnamese exporter
under Chapter V of Decree received a financial
24 benefit in connection
(f) Income Tax Preferences with this program.
under Chapter IV of Decree
124
(g) Tax Exemptions and
Reductions for Foreign-
Invested Enterprises.
In its investigations, the CBSA
combined these programs into
one, on the basis they were
very similar.
The GOV advised in its RGQ
that it has addressed:
 sub-program (a) under
Program 18;
 sub-program (b) under
Program 29;
 sub-program (c) under
Programs 18, 32, 42 and
44;
 sub-program (d) under
Programs 28, 31 and 41;
and
 sub-program (g) under
Program 38.
Accordingly, its response for
Program 30 has been limited to
sub-programs (e) and (f).
The existence of the five This program is None Appendices I and II of The GOV advised that
separate programs below was governed by the Decree No. 118/2015/ND- no exporter of the
Exemptions/reductions
alleged in four separate following legislation: CP defines eligible goods was in receipt of
of Land Rent, Tax, and
33 investigations by the CBSA: the  Decree sectors and regions. any benefit under this
Levies (consisting of five
CBSA COR case, the CBSA 46/2014/ND-CP program.
separate programs)
Cold-rolled steel case, the Articles 19 and 20 of The Commission did
Decree 46 provides not find any evidence
196
PUBLIC RECORD
CBSA Copper Pipe case and dated 15 May further eligibility criteria in during verification of
the CBSA Oil Tubes case: 2014298 addition to Appendices I any exporters being in
(a) Land rent  Decree and II of Decree 118. receipt of a financial
reduction/exemption for Those relevant to the benefit under this
135/2016/ND-CP
exporters and land use goods are region specific, program.
dated 9 September including industrial zones.
fees or leases exemptions/ In light of the evidence
2016299
reductions before it, the
(b) Land-use levy  Decree Commission is not
exemption/reduction 35/2017/ND-CP satisfied any
(c) Land-rent dated 3 April Vietnamese exporter
exemption/reduction 2017300 received a financial
(d) Land use tax exemptions/ benefit in connection
reductions with this program.
(e) Preferences related to land
use tax, land use levy, land
rent and water surface rent.
In its investigation the CBSA
combined these programs into
one, on the basis they were
very similar.
The GOV advised in its RGQ
that it has addressed:
 sub-program (a) under
Program 3;
 sub-program (b) under
Program 34; and
 sub-program (d) under
Program 19.
Accordingly, its response for
Program 30 has been limited to
sub-programs (c) and (e).

300 Ibid.
197
PUBLIC RECORD
This program provides for rent
exemptions and reductions for
various periods, depending on
what eligibility criteria have
been satisfied.
It is alleged that under this This program is None Exemptions to the land- The GOV advised that
program, exemptions or governed by Decree use levy is available for no exporter of the
reductions from payment of the 45/2014/ND-CP dated various residential land goods was in receipt of
land use levy are provided in 15 May 2014.301 and land used for any benefit under this
certain circumstances. constructions of social program.
The existence of this program housing. The Commission did
was first alleged in the CBSA Reductions in the levy is not find any evidence
Copper Pipe case and later available for residential during verification of
combined with other similar land owned by ethnic any exporters being in
Land-Use Levy programs in the CBSA COR minorities or poor receipt of a financial
34
Exemptions/ Reductions case. households, or to people benefit under this
The Commission has combined with meritorious service to program.
sub-program (b) from Program revolution. In light of the evidence
33 into its analysis of this before it, the
program. Commission is not
satisfied any
Vietnamese exporter
with this program.
It is alleged that under this The carrying forward of None Available to all enterprises While utilised by many
program preferential treatment losses is permitted in all sectors and all exporters of the goods,
is available in connection with pursuant to Law locations who have the Commission
Preferential Provisions the carrying forward of losses 32/2013/QH13 of 19 incurred a loss in the considers that this
36 for Carry-forward of into future years for the June 2013.302 previous five years. program is not specific
Losses determination of assessable and is therefore not
taxable income. countervailable.
301 EPR 550, Item 36, GOV REQ, Exhibit 36.

302 EPR 550, Item 36, GOV RGQ, Exhibit 33.
198
PUBLIC RECORD
The existence of this program
was alleged in the CBSA Oil
Tubes case, which was
conducted in 2015. During its
investigation, no exporter in
Vietnam provided sufficient
information to the CBSA to
determine an amount of
subsidy. Therefore, the amount
of subsidy for all Vietnamese
exporters in that case was
determined in accordance with
a ministerial specification,
pursuant to which the CBSA
found that all programs were
countervailable.
It is alleged that under this The program was None A range of projects and The Commission is
program, income tax preference established under geographical areas are satisfied that this
were provided to enterprises Decree 24/2000/ND-CP set out in the appendices program ceased in
with foreign investment. dated 31 July 2000303 to Decree 24/2000/ND-CP 2004.
The existence of this program and was later terminated where investment is The Commission did
was alleged in the CBSA under Decree encouraged. not find any evidence
Copper Pipe case and the 164/2003/ND-CP dated during verification of
CBSA Oil Tubes case. 22 December 2003.304 any exporters being in
Tax Exemptions and receipt of a financial
38 Reductions for Foreign- benefit under this
Invested Enterprises program.
before it, the
Commission is not
satisfied any
Vietnamese exporter
with this program.

199
PUBLIC RECORD
200

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PUBLIC RECORD

CUSTOMS ACT 1901 - PART XVB

STATEMENT OF ESSENTIAL FACTS

7.1 PRELIMINARY FINDING ............................................................................................................................................87

13.3 SECURITIES .........................................................................................................................................................133

C3.1 PROGRAMS REPEALED AS PART OF VIETNAM’S ACCESSION TO THE WTO ...............................................174

1 SUMMARY AND RECOMMENDATIONS

The Commissioner has found that the goods exported by:

 Chinese exporters were at dumped and subsidised prices.

1.2 Authority to make decision

when conducting investigations in relation to goods covered by an application under

1.2.2 Preliminary affirmative determination

The Commissioner has reconsidered whether to make a PAD, and decided to do so in

1.2.3 Statement of essential facts

2 Electronic public record (EPR) 550, Items 2 and 3.

1.2.4 Report to the Minister

1.3 Findings and conclusions

 recommend an exemption under sections 8(7)(a) and 10(8)(a) of the Customs

1.3.2 The Australian market (chapter 5)

1.3.3 Dumping margins (chapter 6)

Country Exporter Dumping Margin (%)

1.3.4 Subsidy margins (chapter 7)

Country Entity Subsidy Margin (%)

1.3.5 The economic condition of the Australian industry (chapter 8)

1.3.6 Material injury caused by dumped and subsidised goods (chapter 9)

1.3.7 Whether dumping and subsidisation may continue (chapter 10)

1.3.8 Non-injurious price (chapter 11)

1.3.9 Proposed measures (chapter 12)

The Commissioner proposes to recommend to the Minister that anti-dumping measures,

Exporter Proposed duty Rate of ICD Rate of IDD Combined rate of

All other Exporters Ad valorem 51.6 0.0 51.6

1.3.10 Preliminary affirmative determination (chapter 13)

1.3.11 Termination (chapter 14)

Subject to any submissions received in response to this SEF, the Commissioner

In respect of this investigation:

2.2 Previous cases

2.3 Conduct of the investigation

2.3.2 Australian industry

13 EPR 550, Items 2 and 3.

Desktop verifications were undertaken for the following importers:

 Steelforce Australia Pty Ltd (Steelforce Australia) importing from China

 B&D Metals Group Pty Ltd (Vietnam)

2.3.5 Foreign Governments

No questionnaire response was received from the GOC.15

2.4 Submissions received from interested parties

Table 5 – Submissions considered in this SEF

2.5 Preliminary affirmative determination

2.6 Responding to this SEF

16 EPR 550, Item 17.

Responses to this SEF should be received by the Commissioner no later than

The Commissioner must report to the Minister by 23 July 2021.

Submissions should preferably be emailed to: [email protected]

Alternatively, interested parties may post submissions to:

Confidential submissions must be clearly marked accordingly and a non-confidential

3 THE GOODS, LIKE GOODS AND THE AUSTRALIAN

3.2 Legislative framework

3.3 The goods

The application defined the goods as:

3.3.2 Tariff classification of the goods