Setback for shrimp exporters

US court issues injuction on reduced anti-dumping duty on exports.

The US Court of International Trade (CIT) has issued an injunction order against a decision of US Department of Commerce (DoC) to reduce the country-specific average anti-dumping duty on warm water shrimp for India to 1.69 per cent.

CIT issued this crucial order on August 7 on an appeal filed by the Southern Shrimp Alliance (SSA), the original petitioner in the anti-dumping case. The DoC decision will be suspended until the judgment of CIT is delivered.

This is a serious setback for the Indian seafood export industry as the refund of anti-dumping duty may be delayed. The DoC had reduced the average duty from 7.22 per cent to 1.69 per cent. Thus, exporters were to get a refund of 5.53 per cent, which they had already paid.

There is a possibility that the provision of customs bond will also continue due to the injunction order.

Recently, the dispute settlement body of the World Trade Organisation (WTO) had declared that the customs bond imposed on shrimp imports by Washington was illegal and a violation of the international trade practices. However, the US administration has so far not issued an order on this.

Anwar Hashim, president, Seafood Exporters’ Association of India (SEAI) told Business Standard that the association was hoping the US administration would implement the WTO decision soon.

DoC had determined the rate of duty in the final determination of the second administrative review to be de minimis (0.60 per cent) for Devi Seafoods and 1.69 per cent for Falcon Marine Exports. The effective period of the review was from February 1, 2006 to January 31, 2007.

Meanwhile, Devi Seafood has decided to intervene as defendant-intervener in the case before CIT.

It is expected that Falcon will follow suite. A stay order on the recent injunction may be in the making. DoC will re-determine the issues and submit the revised final determination to CIT for consideration, approval and judgement. According to sources, the entire process, in normal course, may take 18-24 months.