Anti-Dumping Duty And Countervailing Duty - CDPN24

A Guide For Traders

Introduction
Basis of ADD and/or CD
Type and duration of ADD and/or CD
Expiry Review
Registration
Notification
Consequences of ADD and/or CD for VAT
Rates of Duty
Preparation for Revenue Checks on Goods
Entry Instructions
Provisions applicable to named companies
TARIC
Appeals against imposition of ADD and/or CD
Further Information

1. Introduction

Anti-dumping duty and/or Countervailing duty are import duties imposed imposed in addition to, and independent of, any other duty to which imported goods are liable and they apply across the European Union (EU). They are introduced by Regulation or Decision at European Union level. They are collected by Member States of the Community in the form, at the rate specified and according to the other criteria laid down in the Regulation or Decision imposing such duties. Anti-dumping duty and/or Countervailing duty provide protection against both the dumping of goods in the EU at prices substantially lower than their normal value, and the injury to EU industry which would otherwise result.

This leaflet describes these duties and provides a guide for traders and the public on how to deal with the issues associated with them.

Type of duty

Anti-Dumping duty (ADD): Anti-dumping-duty is imposed to provide protection to Community industry against the dumping of goods from non-Community countries at prices that are substantially lower than the normal commercial value. Goods are considered to be dumped if it is established that their export price to the Community is less than the price of the same or similar goods on the domestic market of the exporting country.
Countervailing duty (CD): Countervailing duty is levied on goods which have received Government subsidies in the originating or exporting country, thus enabling the goods to be imported into the Community at prices substantially lower than the normal commercial value.

For customs purposes CD is treated in the same way as ADD, it is possible to have both ADD and CD on the same product.

The exporting country is normally the country of origin, but it can be another third country, except where, for example, the products are merely transshipped through that country, or the products concerned are not produced in that country, or there is no comparable price for them in that country.

ADD and/or CD do not apply to goods (irrespective of country of origin) , which are in free circulation in the Community. However, there is provision whereby ADD and/or CD may be imposed on products that are assembled or produced in the Community from components imported from outside the Community.

2. Basis of ADD and/or CD

ADD and/or CD may be applied to any dumped product whose release for free circulation in the European Union causes injury. Written complaints about dumping by manufacturers in countries outside of the European Union may be made by companies within it and will then be investigated by the European Commission in conjunction with national administrations. Once a complaint is accepted by the EU a Notice of Initiation is published in the Official Journal of the EU to inform members of the public that an investigation has been inititated. A note to this effect is also displayed on TARIC under the product and origin concerned. Investigations are generally concluded within 12 months, but must be concluded within 15 months. Provisional duties can be imposed no earlier than 60 days from the date of initiation of the investigation and no later than 9 months after that date.

In Ireland the Department of Jobs, Enterprise and Innovation is the relevant national body and they may be contacted at:

EU Affairs,
Department of Jobs, Enterprise and Innovation
Room 515, Kildare Street,
Dublin 2
Phone: 01 6312532 Fax: 01 6312562

3. Type and Duration of ADD and/or CD

Where the investigations conclude that there is dumping taking place and therefore causing damage to Community industry, ADD and/or CD are imposed either provisionally or definitively. This is done by way of a Council Regulation which also sets out the facts and findings of the investigation. This legislation is published in the Official Journal of the EU and a link to the legislation is also displayed on TARIC. In each case specific circumstances apply and these are summarised below:

Provisional Duties: Imposed when preliminary investigations indicate that dumping has occurred. They usually last for a maximum period of 9 months and provide protection to Community industry while a full investigation is conducted. At the end of the investigation, the provisional anti-dumping duty may be made definitive, may lapse or be cancelled. Provisonal duties are collected automatically as the goods clear customs and are placed on deposit pending the final outcome of the investigation.
Definitive Duties: Normally last for 5 years and are imposed if a full investigation of the facts confirms earlier findings of dumping.

4. Expiry Review

As stated previously, definitive ADD and / or CD are normally imposed for a fixed period of 5 years. After that, they automatically expire, unless a review demonstrates a need for them to be continued. An ‘expiry review’ can be launched either at the request of producers in the EU, or on the initative of the Commission. Any request for a review must be accompanied by evidence that the expiry of measures would be likely to result in a continuation or recurrence of subsidisation and injury, for example:

evidence of continued subsidisation and injury
evidence that the removal of injury is only due to the measures in force
evidence that further subsidisation and injury is likely if the measures are repealed.

In the final year of the measures, the Commission publishes a "Notice of Impending Expiry" in the EU’s Official Journal. Community producers may then request a review no later than three months before the measures are due to expire.

If no review is received, the Commission publishes a "Notice of Expiry" announcing that the measures will lapse at the end of the five-year period.

If it receives a substantiated request for review, the Commission publishes a "Notice of Initiation" of an expiry review in the Official Journal and starts an investigation to examine both the dumping and the injury. An expiry review should normally be completed within 12-15 months at most.

ADD and /or CD will continue to be collected during the period of the expiry review. During this time the extension of the period of validity of the ADD and/or CD will be displayed on TARIC . Following an expiry review the duties are either repealed or maintained. If maintained they will normally remain in force for a further five year period, as set out in the new Regulation.

5. Registration

Registration is a measure used to record the import transactions of products subject to ADD and/or CD coming from countries, not themselves subject to the duty, but which are the subject of anti-circumvention investigations in relation to those products. Circumvention is where the pattern of trade between third countries and the EU, or between individual companies in the country subject to measures and the EU, is changed specifically to get around any ADD and/or CD that has been applied. While the investigation into the circumvention allegations is underway, the Customs authorities register imports of the products concerned so that any ADD and/or CD subsequently imposed can be applied retrospectively to those imports. Registration usually expires after nine months and the retrospective application of any duty imposed cannot extend further back than the date the Registration measure was imposed.

While ADD and/or CD will not be collected on the importation of goods subject to Registration, it is important to note that these goods could become liable to such duty at the end of the Registration period, depending on the outcome of the Commission investigation.

Registration, like the other measures, can only be applied to products from a particular origin or manufacturer on foot of a Council Regulation, which is published in the Official Journal. The Registration measure is also displayed on TARIC, together with the commencement date, which is displayed in brackets after the measure.

6. Notification

A Regulation or Decision (published in the Official Journal of the European Union) will govern each individual ADD and/or CD measure. The Regulation or Decision will contain details relating to the ADD and/or CD measure(s) imposed i.e. whether provisional or definitive, duration and rates, or if imports are to be registered. Subsequent Regulations or Decisions will be published where it is decided to amend or withdraw the Regulation imposing the ADD and/or CD or if an expiry review is requested.

It is essential for traders involved in the import of goods which are liable to ADD and/or CD to familiarize themselves with the relevant Regulation(s) or Decision(s), particularly in relation to time limits. In this regard, traders should note in particular that while an investigation must be concluded within fifteen months of its date of initiation, the European Council may issue a Regulation or a Decision imposing ADD and/or CD before this period expires i.e. traders should not enter binding contracts on the assumption that the Council will wait until the last possible date for imposing the relevant measures. The Official Journal of the European Communities together with the TARIC (paragraph 12) should be monitored regularly and carefully in this regard.

7. Consequences of ADD and/or CD for VAT

The value of goods for VAT at importation includes, in addition to customs duty, any ADD and/or CD chargeable, whether provisional or definitive.

8. Rates of Duty

The rate of ADD and/or CD will depend on the basis on which it is to be applied, the country of export and/or the country of origin and the manufacturer/producer/exporter involved. Each of these considerations is described below.

ADD and/or CD may be applied on an ad valorem, variable, or specific basis. (Ad valorem means as a specific percentage of the value of the goods.)
In the case of ad valorem, the duty is expressed as a percentage of the net free-at-Community-frontier price before duty i.e. the price (also referred to as the “C.I.F. Community frontier”) including the cost, insurance and freight charges incurred up to the point of entry to the Community.
In the case of a variable duty, the amount involved is normally expressed as being:
1. the amount by which the net free-at-Community-frontier price before duty is less than a specified Community price; or
2. the amount by which the price to the first purchaser in the Community is less than the normal value in the exporting country or country of origin of the imported goods.
Where the amount of the above duties is expressed either as an ad valorem or a variable duty, the higher of the two amounts will apply. In the case of a specific duty, it is shown as a fixed amount (expressed in €) per tonne or other unit of quantity.
The rate of duty imposed on particular goods may vary depending on the exporting country or the country of origin of the goods. Any importer seeking to declare goods at a lower rate on the grounds of origin must provide supporting documentary evidence to Revenue as otherwise staff will apply the higher rate of duty (see paragraph 9)
Similarly, the rate of duty imposed on goods may vary as between one manufacturer/ producer/exporter and another or goods may be excluded altogether from the scope of the duty on the grounds that they were manufactured/produced and/or exported by certain specified companies. In such cases, the application of individual reduced duty rates will be conditional upon presentation to Customs of the appropriate documentary evidence in the form of a valid commercial invoice from the company concerned. This invoice must contain a declaration signed by an official of the entity issuing the commercial invoice and must be strictly in the format as outlined in the relevant regulation. A certificate signed by a Director or the Company Secretary, to the effect that the goods were manufactured/produced and/or exported by that company, must be produced.

9. Preparation for Revenue Checks on Goods

Where traders claim non-liability to a duty or a reduced rate of duty on the grounds of origin, they must produce appropriate evidence to Revenue showing the actual country of origin in support of such claims and the SAD declaration should include the appropriate Box 44 codes (AEP Trader Guide (PDF, 263KB ). Normally, such evidence should take one of the following forms:

a properly completed form prescribed in the respective preferential trade agreement between the Community and the country in question and arrangements for the purpose of claiming preferential rates of duty i.e. Certificate of Origin Form A, Movement Certificates EUR.1, Form EUR.2 or invoice declaration; or
a non-preferential Certificate of Origin as provided for in the Community Customs Code and the Customs Code Implementing Provisions.

10. Entry Instructions

Accounting for ADD and/or CD
When preparing entries, traders or their agents should ensure that the amount payable is set out separately and clearly on the SAD and that the duty is paid in the normal way. The category of ADD and/or CD should be clearly indicated in Box 47 of the SAD using the following codes:
- Provisional ADD - A35;
- Definitive ADD - A30;
- Provisional Countervailing duty - A45;
- Definitive Countervailing duty - A 40
Review of all provisional duty payments
On the revocation of a provisional duty or on the imposition of a definitive ADD/CD replacing the provisional duty, Revenue will re-visit all of the relevant SADs where provisional duty has been paid and take appropriate action as outlined below.

Normally any adjustment in the amount of the provisional duty in favour of the importer is credited to the payer’s account. If, subsequently, an actual refund is requested this will be processed separately.
1. Provisional ADD/CD is revoked and not made definitive
  - If a payment has been made in respect of a provisional ADD/CD and the provisional duty is subsequently revoked and a corresponding definitive ADD/CD is not imposed, the amount involved will be re-credited to the payer's account.
  - In these cases, the VAT chargeable will also be re-assessed and re-credited to both VAT registered and non-VAT registered persons. However, re-crediting is only allowed in the case of non-registered persons (registered persons will claim the VAT on their VAT 3).
2. a definitive ADD/CD at a rate lower than the provisional rate of duty is imposed
  - Where a definitive ADD/CD at a rate lower than the provisional rate of duty is imposed, duty will be re-assessed at the definitive rate and any surplus will be re-credited to the payer's account.
  - In these cases, the VAT chargeable will also be re-assessed and re-credited to both VAT registered and non-VAT registered persons. However, re-crediting is only allowed in the case of non-registered persons (registered persons will claim the VAT on their VAT 3).
3. the definitive ADD/CD imposed is at a higher rate than the provisional rate of duty
  - Where the definitive ADD/CD imposed is at a higher rate than the provisional rate of duty, the difference between the definitive duty and the provisional duty for the period of application of the latter will not be collected.
4. the definitive ADD/CD is imposed at the same rate as the provisional rate of duty
  - The provisional payment will be re-designated as a definitive payment.
Cases involving other Customs Procedures
In cases where other Customs Procedures are involved, specific arrangements apply as set out below.
1. Warehousing
  ADD and/or CD is not payable until such time as the goods concerned are released into free circulation. Goods are liable to the rate in force at the time of their removal from the warehouse.
2. Inward Processing (IP)
  Importers may claim relief from ADD and/or CD under IP arrangements in the same way as relief from other customs duties. IP is available for goods that are imported from outside the Community, processed and re-exported outside the Community.
3. Outward Processing (OP)
  Where goods entered to OP are liable to ADD and/or CD, the duty is chargeable on the compensating product(s) but is not to be included in the amount to be deducted in respect of the exported goods.
4. End-Use
  If goods entered to End Use relief are liable to ADD and/or CD, then the ADD and/or CD must be charged notwithstanding the end use. (End-use relief only applies to customs duty – all other duties such as ADD, CD, Excise and/or VAT, as appropriate, remain payable.)
5. Free Zones
  ADD and/or CD are suspended on importation into a Free Zone, and until such time as they are declared into free circulation.

11. Provisions applicable to named companies

Any ADD and/or CD provisions (e.g. a full or reduced rate of duty or exclusion from a particular duty) applied to a named company at a specific address is taken as applying also to any branch of that company operating under the same name at a different address in the same country.

12. TARIC

The most up to date information on any ADD/CD or registration measures is available on the europa website (TARIC )

13. Appeals against imposition of ADD and/or CD

A trader who is aggrieved by a decision made by Revenue to impose ADD and/or CD should outline the basis for his/her appeal in writing enclosing the related documents and forward it to the person from whom (s)he received the written decision within 30 days of that decision. Any duty under dispute must normally be paid or secured before the appeal can be processed. Further information on Appeals is contained in Information Notice c&e 5

14. Further Information

Further information on ADD and/or CD may be obtained by contacting your local Revenue Office.

Customs Division

November 2011

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