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CUSTOMS ISSUES PROVISIONAL DUMPING DUTY AT 16% ON ALUMINIUM EXTRUSIONS FROM CHINA - BY ROSS BECROFT
Australian Customs in late October 2009 have issued a Preliminary Affirmative Determination in which provisional dumping duty of 16% will be levied on all imports of Aluminium Extrusion Products from China as of 5 November 2009.
Aluminium Extrusions are widely used in industrial manufacturing processes to produce a myriad of products such as cars, bikes, aircraft, parts and accessories of these goods and various construction materials.
The applicant in this case was Capral Ltd, which represents over 50% of aluminium extrusion production in Australia.
The most interesting aspect of this case is that Australian Customs did not believe that there was enough reliable information from Chinese producers and importers to establish the Normal Value of these products for sale in China. Instead Customs had to construct Normal Value largely based on information supplied by the Applicant. This information was based on items such as LME prices, waste and productions processes and overhead costings.
Under the Customs Act, Australian Customs may have recourse to these alternative methods of determining Normal Value where the usual direct sales information is unreliable or non-existent.
In the Report, Customs have also found that Chinese producers have the benefit of a subsidy that will lead to the imposition of countervailing duties. This relates to three programs one of which is the exemption of producers by the Chinese Government from Value Added Tax for imported plant and technology. Customs have not levied countervailing duty provisionally, but have indicated that it will be levied by apportioning the tax benefits across the life of relevant assets and converting this to a value per kilogram.
Further, some state owned enterprises were found to be providing primary aluminium at less than market value and the benefit was calculated by comparing purchase prices with average LME prices.
This decision will affect many importers and buyers of aluminium extrusions in various forms. Customs will continue an investigation to determine a final dumping duty and a countervailing duty rate. The Chinese interests will no doubt scrutinize these findings very carefully and have an opportunity to have these findings varied or overturned.
As a post script, the Productivity Commission in September 2009 issued its draft Inquiry Report into Australia’s Anti-Dumping and Countervailing System. Many submissions were received on behalf of importers, producers and other interested parties. It remains to be seen whether this report results in any changes by the Rudd Government. One of the Productivity Commission’s findings was that the laws benefit a small number of import-competing producers and the overall economic benefit of maintaining anti-dumping laws was questioned.
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