Dumping and Anti-Dumping (1) Final

DUMPING AND ANTI-DUMPING
SUBMITTED TO: SUBMITTED BY:

DR. SUNITHA ABHAY JAIN ANAKSHA RIYA MOHAN
SCHOOL OF LAW 2357203
CHRIST DEEMED TO BE UNIVERSITY 1LLM IPL
WORLD TRADE ORGANIZATION
 WTO is an international organization that deals with the global

rules of trade between nations. The primary goal of the WTO is to
ensure that trade flows as smoothly, predictably, and freely as
possible.
DUMPING IN WTO
 Dumping is, in general, a situation of international price

discrimination, where the price of a product when sold in the
importing country is less than the price of that product in the
market of the exporting country. Thus, in the simplest of cases,
one identifies dumping simply by comparing prices in two
markets
OBJECTIVES
 To enter a foreign market by eliminating the competitors in the foreign market

 To sell their surplus production
 To develop trade relation with foreign country
 To expand their products
TYPES OF DUMPING
FIVE TYPES OF DUMPING
 INTERMITTENT DUMPING
 PERSISTENT DUMPING
 PREDATORY DUMPING
 SOCIAL DUMPING
 MARGIN DUMPING
INTERMITTENT DUMPING
 When the production of a product is more than the demand in the

home country, the stock pile up even after sales. In such a case,
the producer sells the remaining stock in foreign countries at low
price, without reducing the price in domestic countries.
 PERSISTENT DUMPING
When the monopolist sells the remaining, production in foreign
countries at a lower price continuously it is called persistent
dumping.
PREDATORY DUMPING
 Predatory dumping involves a deliberate strategy by a company

or a country to temporarily sell products at very low prices in the
foreign market. The goal is to drive competitors out of the market
and establish a monopoly or dominant position, which would then
allow the dumping entity to raise prices
SOCIAL DUMPING
 Social dumping refers to the situation where products are sold in
a foreign market at low prices due to lower labor and production
standards in the exporting country. This can lead to concerns
about unfair competition and exploitation of workers.
 MARGIN DUMPING
Margin dumping refers to the situation where the export price is

lower than the normal value, but not necessarily below the
production cost. This can still be considered dumping if it causes
injury to the domestic industry in the importing country.
EFFECT OF DUMPING ON IMPORTING
COUNTRIES ARE:
 The industry of the importing country experience, the decline in

sales and profits.
 If the dumping is for longer period ,it affects the survival of the
industry and also changes the industrial structure in the foreign
country.
 If the dumping company increases the price at the later stage, the
importing country would be at loss both in terms of high cost of
imports and change in structure of domestic industry.
EFFECT OF DUMPING ON EXPORTING
COUNTRIES
 The consumers of the exporting country pay higher price when

the consumers of foreign country enjoy the product at lower
price.
 The exporting country finds market for the excess production.
 The exporting country earns foreign exchange and it contributes
for the surplus balance of the balance of payment position.
ANTI-DUMPING
 Anti-dumping is a trade remedy measure that falls under the purview of the World Trade
Organization (WTO). It is designed to address the issue of unfair competition in International
trade due to the practice of "dumping," where a country exports a product to another country at a
price lower than its normal value, often causing harm to domestic industries in the importing
country. Anti-dumping measures aim to counteract this unfair trade practice and protect domestic
industries from the negative effects of such imports.
 Article VI of the GATT ,1974 deals with anti-dumping measures
Therefore, after having determined the existence of dumping, the competent authorities must
establish:
* the existence, or threat, of injury to the domestic industry; and
* the causal link between the dumping and the injury.

WORKING OF ANTI-DUMPING PROCESS
WITHIN WTO FRAMEWORK
1. Complaint : A domestic industry in an importing country can file a complaint
with its government, alleging that imported goods are being dumped in its
market and causing injury to its industry. This initiates an investigation process.
Article 5 of the Anti-Dumping Agreement contains numerous requirements
concerning the initiation of an anti-dumping investigation. The domestic
investigating authorities can instigate an investigation on their own initiative
•
Injury Determination: The authorities also assess whether the domestic industry has
suffered "material injury" or is threatened with such injury due to the dumped imports.
Factors considered include factors like decreased sales, reduced market share, reduced
profits, and negative employment effects. The Anti-Dumping Agreement defines ‘injury’ to
mean one of three things:
* material injury to a domestic industry;
* threat of material injury to a domestic industry; or
*retardation of the establishment of a domestic industry
1.
.
 Casual Link: The investigating authorities would find out there

is any casual link between the dumped imports and injury.If there
is any casual link the authorities take appropriate acton.
Anti dumping investigation
 The Anti-Dumping Agreement sets out, in considerable detail, how

investigating authorities of WTO Members have to initiate and conduct an anti-
dumping investigation. This section addresses:
• the initiation of an anti-dumping investigation;
• the period of an investigation; and
• the conduct of an investigation.
 INITIATION OF AN INVESTIGATION
Article 5 of the Anti-Dumping Agreement contains numerous requirements concerning the

initiation of an anti-dumping investigation. The domestic investigating authorities can
instigate an investigation on their own initiative.
However, the Anti-Dumping Agreement specifies that investigations must gener-
ally be initiated on the basis of a written application submitted ‘by or on behalf
of ’ a domestic industry.
 The Anti-Dumping Agreement contains guidance relating to the required contents of the
initiation request, including:
* evidence of dumping;
* evidence of injury to the domestic industry; and
* evidence of a causal link between the dumped imports and the injury to the
domestic industry.
 The application must contain information that is ‘reasonably available’ to the applicant
in accordance with Article 5.2. Simple assertion, unsubstantiated by relevant evidence,
cannot be considered to meet the requirements of this provision.
 Article 5.3 of the Anti-Dumping Agreement requires that the investigating authorities
examine the accuracy and adequacy of the evidence provided in the application to
determine whether there is sufficient evidence to justify the initiation of the
investigation.
 An application to initiate an anti-dumping investigation shall be rejected, and an
investigation shall be terminated, promptly as soon as the investigating authorities are
satisfied that there is not enough evidence either of dumping or of injury.
PERIOD OF INVESTIGATION
The Anti-Dumping Agreement refers to the concept of a ‘period of investigation’, and the
use of such an investigation period appears to be implicit in several provisions of the
Agreement. The period of data collection for dumping investigations normally should not
exceed twelve months and ,in any case, be no less than six months, ending as close to the
date of initiation as is practicable.
Conduct of investigation
*Article 6 of the Anti-Dumping Agreement contains detailed rules concerning the

process of the investigation, including evidentiary, informational and procedural elements.
*Article 6.1 requires that all interested parties in an anti-dumping investigation be given
notice of the information which the authorities require and ample opportunity to present in
writing all evidence which they consider relevant irrespective of the investigation. In
practice, investigating authorities typically send interested parties questionnaires in which
they identify the information that they require in order to conduct the investigation. Article
5.10 of the Anti-Dumping Agreement specifies that an anti-dumping investigation must be
completed within one year, and in no cases more than eighteen months, after initiation.
.
Review and Appeal: The exporting country and other affected parties can challenge
the findings and measures through dispute settlement mechanisms within the WTO.
 It is important to note that anti-dumping measures should be
applied in a manner consistent with WTO rules, particularly the
Agreement on Implementation of Article VI of the General
Agreement on Tariffs and Trade 1994 (the Anti-Dumping
Agreement)

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DUMPING AND ANTI-DUMPING

SUBMITTED TO: SUBMITTED BY:

 WTO is an international organization that deals with the global

 Dumping is, in general, a situation of international price

 To enter a foreign market by eliminating the competitors in the foreign market

FIVE TYPES OF DUMPING

 When the production of a product is more than the demand in the

 Predatory dumping involves a deliberate strategy by a company

Margin dumping refers to the situation where the export price is

 The industry of the importing country experience, the decline in

 The consumers of the exporting country pay higher price when

 Article VI of the GATT ,1974 deals with anti-dumping measures

* the existence, or threat, of injury to the domestic industry; and

* the causal link between the dumping and the injury.

*retardation of the establishment of a domestic industry

 Casual Link: The investigating authorities would find out there

 The Anti-Dumping Agreement sets out, in considerable detail, how

Article 5 of the Anti-Dumping Agreement contains numerous requirements concerning the

However, the Anti-Dumping Agreement specifies that investigations must gener-

ally be initiated on the basis of a written application submitted ‘by or on behalf

*Article 6 of the Anti-Dumping Agreement contains detailed rules concerning the

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