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April, 2018

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Since, 2015

Forum NEWSLETTER

Volume IV Issue I

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© An E-Newsletter from Forum For Trade Remedies , 2018

www.traderemedies.in


Forum Newsletter April, 2018 Volume IV Issue I An E-Newsletter

CONTENTS Editor’s Choice: Summary of Development under Trade Defense laws: a) Action taken by India. b) Action taken by other countries. i. Against India. ii. Against other Countries. Trade Agreements: WTO in News: Anti-Trust development in India. Special Story Covered: Other ~ News Report:

2018 Note: This Newsletter is for information only. The content has been compiled from various sources. Reach Us: We encourage you to come forward and provide us your feedback at editor@traderemedies.in

Š2018 Forum for Trade Remedies (FFTR) All Rights Reserved


Forum Newsletter April, 2018 Volume IV Issue I An E-Newsletter

A Message to Readers……

Forum

for Trade Remedies (FFTR) was conceived with the Objective of

promoting the interest of Indian Manufacturing sector in terms of domestic and International legal frameworks and policies in international Trade and considering that there is a need for uniting the Industry to contest and address the common issues concerning the Industry with regards to efficacy, efficiency, effectiveness of trade Defence instruments such as Anti-Dumping, Anti-Subsidy and Safeguards. It holds interactions with Govt. authorities, trade associations, industry bodies on various trade remedial measures (TRM) and issues concerning rules, regulations, policies, procedures, practices with the aim of bringing positive changes in the policy framework; creation of level playing field and furthering the cause of the domestic industries for increasing effectiveness of TRM. FFTR publishes a Bi-monthly Newsletter which tracks latest development in the field of trade Defence action. The newsletter also includes information on developments in the area of Free Trade Agreements (FTAs) and Foreign Trade Policies (FTPs) etc. At present it has more than

100

MEMBERS from various Associations and

Industries.

©2018 Forum for Trade Remedies (FFTR) All Rights Reserved


Forum Newsletter April, 2018 Volume IV Issue I An E-Newsletter

Summary of Development under Trade Defense laws: A) Action taken by India: 1- Ministry of Commerce has initiated Mid-term Review (MTR) investigation with regard to the antidumping duties in force on the imports of Graphite Electrodes of all diameters from China. 2- Ministry of Commerce has Initiated Anti-Dumping investigation on imports of “Certain Epoxy Resins" from China, European Union, Korea, Taiwan and Thailand. 3- Ministry of Commerce has Initiated Anti-Dumping investigation on imports of “Ethylene Vinyl Acetate (EVA) Sheet for Solar Module” from China, Malaysia, Saudi Arabia, South Korea and Thailand. 4- Ministry of Finance has imposed Anti-Dumping duty on imports Phosphorus Pentoxide from China. 5- Ministry of Finance has imposed Anti-Dumping duty on imports of fishing Net from China and Bangladesh. 6- Ministry of Commerce has initiated Anti-Dumping Duty investigation concerning imports of “Non-Plasticized Industrial Grade Nitrocellulose is excluding Nitrocellulose Damped in Ethanol and Water wet” from Brazil, Indonesia and Thailand.

B) Action taken by other countries: North America: 1- US Department of Commerce Initiates Antidumping Duty (AD) and Countervailing Duty (CVD) Investigations of Imports of Laminated Woven Sacks from the Socialist Republic of Vietnam 2- US ITC makes determination in Five-Year (Sunset) Review Concerning Foundry Coke from China. 3- US ITC has determined initiation of Anti-Dumping investigation on imports of biodiesel from Argentina and Indonesia. 4- Commerce Finds Dumping of Imports of Tool Chests and Cabinets from China and Vietnam.

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Forum Newsletter April, 2018 Volume IV Issue I An E-Newsletter

5- US DOC finds Countervailable Subsidization of Imports of Stainless Steel Flanges from China. Asian Countries: 1- Australian Anti-Dumping Commission’s has imposed an anti-dumping duty on

dichlorophenoxy-acetic acid, commonly known as 2,4-D from China.

Trade Agreements: India, China plan FTA breakthrough Union Commerce Minister Suresh Prabhu and his Chinese counterpart, Zhong Shan, met in New Delhi for the first high-level contact between both sides, which have decided to “reset” their ties this year in the run-up to a Xi-Modi summit meeting in China. Mr. Zhong, who co-chaired the 11th meeting of the India-China Joint Group on Economic Relations, Trade, Science and Technology with Mr. Prabhu, said a free trade agreement (FTA) between India and China would be negotiated in due course, which would be a breakthrough in ties.

WTO in News: 1- On 27 March 2018, the European Union notified the WTO’s Committee on Safeguards that it initiated on 26 March 2018 a safeguard investigation on certain steel products. 2- Indonesia launches safeguard investigation on ceramic flags and paving, hearth or wall tiles; ceramic mosaic cubes and the like. Informed WTO. 3- U.S. challenges India’s export subsidies at WTO

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Forum Newsletter April, 2018 Volume IV Issue I An E-Newsletter United States has challenged India’s export subsidy programmes at the World Trade Organisation (WTO). The move comes close on the heels of a string of statements accusing India of “unfair” trade practices, by President Donald Trump. U.S. Trade Representative (USTR) Robert Lighthizer said Washington had requested dispute settlement consultations with the Government of India at WTO on the issue. Mr. Trump had threatened to raise duties on products from India. Unlike the many trade disputes between India and America that are sector specific or product specific, the new move by Mr. Lighthizer — a trade hawk closely in alignment with Mr. Trump’s nationalist economic policies — is broad and sweeping in targeting the whole range of Indian export subsidy programmes. ‘Distorting trade’ A statement from the USTR listed the Merchandise Exports from India Scheme; Export Oriented Units Scheme and sector specific schemes, including Electronics Hardware Technology Parks Scheme; Special Economic Zones; Export Promotion Capital Goods Scheme, and a duty free imports for exporters programme as distorting trade in a way that allows Indian exporters “to sell their goods more cheaply to the detriment of American workers and manufacturers.” “These export subsidy programmes harm American workers by creating an uneven playing field on which they must compete,” said Mr. Lighthizer. “USTR will continue to hold our trading partners accountable by vigorously enforcing U.S. rights under our trade agreements and by promoting fair and reciprocal trade through all available tools, including the WTO.” Mukesh Aghi, president of the United States-India Strategic Partnership Forum (USISPF), said the case would not alter the long-term trajectory of bilateral trade partnership. “As the relationship deepens, and volumes increase, disputes are natural. This is a normal dispute redressal mechanism that will run its course.,” Mr. Aghi said. “The U.S has been imposing countervailing duties in response to all these Indian programmes already. The decision to take this to the WTO is a political move and qualitatively different from countervailing duties,” said Moushami P. Joshi, trade lawyer at Washington law firm Pillsbury, where she advises sovereign governments on WTO disputes. The Five Biggest Threats to the WTO

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Forum Newsletter April, 2018 Volume IV Issue I An E-Newsletter The World Trade Organization is facing the greatest crisis of its 23-year existence. President Donald Trump doesn’t believe the WTO can handle the problems created by China’s rapid economic ascent and is fundamentally challenging the rules that govern international trade. “The WTO is unfair to U.S. ,” Trump said on Twitter. The U.S. has attacked both allies and adversaries in an effort to redraw trade relationships and Trump has threatened levies on $150 billion of Chinese goods in an escalating tit-for-tat with Beijing. China has warned of $50 billion of its own tariffs on American imports. The escalating trade skirmish is threatening to sideline the global trading order that the U.S. has helped to build. So as world leaders rush to the White House to defend their countries’ interests, the biggest casualty may be the global system of trade itself. 1- Rules Undermined The unilateral tariffs threatened by the U.S. and China don’t adhere to the WTO’s established procedures, and if triggered, will inflame trade tensions that can’t be constrained by the trade body. The latest round of tariffs are “obviously not good for the WTO,” said Patrick Low, a former chief economist at the institution. “If the measures are implemented, the two biggest traders will have thumbed their noses at the WTO. Politics will have trumped the rule of law.” 2- Reasons to go Rogue The WTO is facing an influx of disputes from countries using national security as a justification for tariffs. This exploits a loophole in WTO law that permits its 164 members to take any action they consider necessary to defend “essential security interests.” Trade officials are concerned that the WTO could be sidelined if countries increasingly abuse the national-security exemption to justify their trade restrictions. WTO Director General Roberto Azevedo said it would be better for countries to address their national security concerns at a political level, rather than testing the limits of the WTO system. “National security is something that is not technical,” Azevedo said. “It is not something that will be solved by a dispute in the WTO. That requires conversation at the highest political 3- Hearings May Be Paralyzed

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Forum Newsletter April, 2018 Volume IV Issue I An E-Newsletter Since August 2017 the U.S. has blocked nominees to the WTO’s appellate body - a key forum for mediating disputes -- saying it has overstepped its mandate. “The WTO has not always worked as expected,” the U.S. Trade Representative said in its annual report. “Instead of serving as a negotiating forum where countries can develop new and better rules, it has sometimes been dominated by a dispute settlement system where activist ‘judges’ try to impose their own policy preferences on member states.” If the U.S. continues its hold, the appellate body will be paralyzed in late 2019 because it won’t have the three panelists required to sign off on rulings. Azevedo said the U.S. block could eliminate the WTO’s role as a trade dispute forum and lead to a “domino effect” of trade retaliation. 4- Market Economy Dispute China says the U.S. and the EU are violating WTO rules by continuing to treat it as a nonmarket economy in anti-dumping investigations. The dispute has already compelled the EU to modify its basic anti-dumping regulations and could ultimately force the U.S. to modify the way it penalizes Chinese producers that ship cheap products to the U.S. market. The U.S. said it has no plans to treat China equally in international anti-dumping investigations because Beijing has not adopted market-economy principles. U.S. Trade Representative Robert Lighthizer previously called it the “most serious litigation that we have at the WTO.” 5- Failed Negotiations It took two decades for the WTO to complete its first significant trade accord and prospects for new deals among its 164 members are slim. As a result, countries are pushing piecemeal accords centered on sectoral issues like ecommerce or investment. While that may be positive for groups of like-minded countries, it underlines the sense that the WTO’s broader negotiating agenda is mired in disagreement. Source: [Bloomberg] Govt may have to stop export subsidies within the next nine months Trade experts have said India's position is weak, with no historical precedent for a country winning a reprieve from the WTO on this matter .There is a possibility of the government having to stop export subsidies within the next nine months, if it happens to lose the trade dispute registered by its American counterpart at the World Trade Organization (WTO).

©2018 Forum for Trade Remedies (FFTR) All Rights Reserved


Forum Newsletter April, 2018 Volume IV Issue I An E-Newsletter Last month, US trade representative Robert Lighthizer’s office challenged India at the WTO over the entire spectrum of its export promotion schemes. The allegation is that they provide undue benefit, against WTO rules, for Indian exporters. “Timelines for a prohibited subsidy dispute are normally half of the other disputes. The only way it could go on beyond nine months is if the issue gets appealed. We don’t know how the current logjam at the Dispute Settlement Body (DSB) is going to affect it,” said Abhijit Das, head of the Centre for WTO Studies here. After the US complaint, the commerce ministry said we had 60 days to respond and settle the dispute through consultation, as established by WTO rules. However, it now appears the allocated time for initial consultation, as well as for every single level of the dispute process, will be effectively cut in half. “Consultations would have to get over within 30 days. Thereafter, if the dispute isn’t resolved, the US will be at liberty to seek establishment of a panel. Once done, about six months will be required for it to come up with a report. Thereafter, if India decides to appeal, the appellate body would have about 60 days to decide the matter,”Das added.

Other ~ News Report: DGS, DGAD merger on cards for streamlining trade remedies The government will soon shift Directorate General of Safeguards (DGS) to Commerce Ministry as part of its plan to create a single authority for imposing trade remedies to protect domestic industry. DGS is under the finance ministry. As per the plan, the government would merge DGS with the Directorate General of Antidumping and Allied Duties (DGAD), the investigating arm of commerce ministry, to streamline the process of imposing trade remedies. Trade remedies which include antidumping, countervailing and safeguard duties are allowed under global trade norms to guard domestic industries from significant imports or cheap inbound shipments. "By merging the two Directorate Generals, the government wants to create a single point contact which can conduct investigations related to international trade and remedial duties," an official told The official said the shifting of DGS to the commerce ministry will happen "very soon, definitely by end-June" .Under the Goods and Services Tax (GST) regime, DGS has also been entrusted to investigate

©2018 Forum for Trade Remedies (FFTR) All Rights Reserved


Forum Newsletter April, 2018 Volume IV Issue I An E-Newsletter complaints of profiteering. The investigating agency submits its reports to the National Anti-profiteering Authority, which then takes its own view and decides on the penalty. Once DGS is shifted to the commerce ministry, the directorate general will be renamed and will continue to be under the Department of Revenue in the finance ministry to carry out profiteering investigations. "It could be renamed as Directorate General of Anti-Profiteering or GST Anti-Profiteering Investigation wing. A final decision will be taken by the finance ministry," the official added. Currently, DGAD conducts probe into allegations of cheap imports, by domestic industries. If established that dumping has caused material injury to domestic players, it recommends imposition of anti-dumping or countervailing duty. While DGAD recommends the duties, the finance ministry imposes the same. On the other hand, DGS is mandated to investigate the existence of serious injury or threat of serious injury to the domestic industry as a consequence of "increased" import of an article into India. Unlike the safeguard duty, which is levied in a uniform way, anti-dumping duty varies from company to company and country to country. India is one of the largest users of these trade remedies. Countries initiate anti-dumping probes to determine if the domestic industry has been hurt by a surge in below-cost imports. As a counter-measure, they impose duties under the multilateral WTO regime. Anti-dumping measures are taken to ensure fair trade and provide a level-playing field to the domestic industry. These measures do not restrict imports or cause an unjustified increase in cost of products.

Disclaimer: This Forum Newsletter is meant for information purpose only and does not purport to be legal advice or opinion, or legal position or otherwise whatsoever on any of the aspect dealt in this Newsletter. This Newsletter is not for advertising or soliciting or not intended to create any kind of relationship or otherwise. FFTR or its staff members are not responsible for any error or omission in this Newsletter or any action taken on the basis of this Newsletter. ********* #Go Green: As 3000 A4 size paper costs a Tree **********

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Comments/ queries can be addressed to Editor FFTR Email: info@traderemedies.in

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FFTR Newsletter - April 2018 - Issue - 0001  

Note: This Newsletter is for information only. The contents has been compiled from various sources.

FFTR Newsletter - April 2018 - Issue - 0001  

Note: This Newsletter is for information only. The contents has been compiled from various sources.

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