More clarity needed on anti-dumping notifications

The Central Board of Excise and Customs (CBEC) has clarified (through Circular number 28/2011-Cus dated July 8, 2011) that definitive/final anti-dumping duty can be collected beyond the stipulated period only when a notification extending the levy has been issued, before the expiry of the parent notification. Unless such revalidation or extension is carried out by a fresh notification, the collection of final anti-dumping duty should cease on the completion of five years from the date of imposition of the duty and where the findings in a review are notified after the lapse of the parent notification, the fresh notification would be effective prospectively from the date of issue of such notification, says the CBEC.

The need for this clarification arose because some anti-dumping notifications expired after the usual period of five years but the notifications extending the levy were issued quite some time after the expiry of the original notifications. For example, the original notification imposing anti-dumping duty on Polytertrafluroethylene (PTFE) originating in or exported from China expired on October 16, 2010, but the notification extending the levy till July 25, 2011, was issued only on March 4, 2011.

Similarly, the notification imposing anti-dumping duty on certain rubber chemicals expired on September 26, 2010, but the notification extending the levy till July 25, 2011, was issued only on March 4, 2011. Some Customs field formations were collecting duty for the intervening period (i.e. the period between the lapse of the original notification and the date of extension of the levy). The CBEC says that in some cases, field formations were collecting anti-dumping duty even after the expiry of the statutorily prescribed period of levy, based perhaps on the premise that the original notification providing for levy of anti-dumping duty did not specify the end date.

The Circular makes it clear that definitive/final anti-dumping duty can be collected only for a period of five years from the date of its imposition. Generally by virtue of Sub-section (2) of Section 9A of the Customs Tariff Act, 1975, the anti-dumping levy notified in pursuance of final findings of the Director General (Anti-Dumping) is effective from the date of imposition of provisional duty and, therefore, the period of five years is to be computed from such date. Collection beyond that period is permissible only when the said levy is extended by a notification either for a further period of five years (in pursuance of the final findings of the Designated Authority in a sun set review) or for one year (during the pendency of sun set review), says the CBEC.

In other words, in the absence of a fresh notification extending the original levy beyond the expiry of the parent notification, anti-dumping duty should not be collected and no retrospective effect can be given to such fresh notifications. The CBEC, however, needs to be more alert. In most cases, the time lapse between the recommendation of the Director General (Anti-Dumping) and the date of notification giving effect to the recommendation exceeds a month; sometimes, it is two to three months. This time gap can be reduced. On its part, in all cases where a review has been initiated, the Director General (Anti-Dumping) can recommend provisional assessment, so that if the review results in determination of dumping, duty can be levied retrospectively in such cases.

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