Dumping occurs when a product is sold cheaper in an imported market than the price of the product in the exporting country. Most countries try to protect their local industries by charging anti-dumping duties.
Anti-dumping is a protectionist duty that governments impose on imports that have been priced below fair market value. Dumping duty is payable by a company importing goods at a price that is lower than the normal value of goods in the export country.
The Normal Value is the price of similar goods sold in the domestic market in the exporting country. This value can be used to calculate the dumping margin.
Anti-Dumping Duties in Australia
The Australian government’s Department of Industry and Science has an Anti-Dumping Commission. The role of the Commission is to investigate alleged cases of dumping and subsidisation of goods imported into Australia. The Commission can decide to impose duties to protect the Australian companies that manufacture similar products.
A subsidies register lists a summary of subsidiary programs that have been investigated by the Commission. An Anti-Dumping Review Panel reviews decisions made by the Minister and Anti-Dumping Commissioner. The Panel may review decisions to impose duties, close investigations, continue investigations and duty assessments.
Australian companies (often a competitor) can apply for anti-dumping duties to be applied to imported goods if they believe prices are below those in the exporter’s domestic market.
Do you Know if you are at Risk of Dumping Duty?
Before placing any order, it is important that a business finds out if it is liable to pay dumping duty and what the cost will be. The Anti-Dumping Commission states ‘importers are required to self-assess whether the imported goods meet the goods description outlined.’ But what if you aren’t sure how to go about self-assessment? It’s not easy for small businesses with no experience to assess their goods.
Often businesses that organise the manufacture and importing themselves, don’t do enough research. They find out too late that if the product’s design or finish was slightly different, they could have avoided duty. Once the goods arrive on an Australian wharf, they are liable for anti-dumping duty.
Vara Allied spends time every week keeping up with changes to the dumping register and ensuring clients’ goods don’t attract the duty. In many cases we have been able to advise clients to make changes to their product to avoid the duty, saving them thousands of dollars. Each product needs to be thoroughly examined and reviewed which Vara Allied does on behalf of clients. If duty is unavoidable, our experienced staff are able to calculate the rates and provide details to the client before manufacture proceeds. Find out more about our Import & Customs services here.
New Anti-Dumping Legislation Targets China
In September 2017 the Australian government introduced new legislation to further protect Australian industries. The legislation came after Australian metal producers made complaints about products imported from Beijing.
Imported products from China accounted for 70% of all actions by the Australian Anti-Dumping Commission in the four months to September 2017. There were 41 cases against Chinese companies, three times more than the second biggest offender, Taiwan.
Australia and the World Trade Organisation
The World Trade Organisation (WTO) reviews the anti-dumping duties and decisions of its nation members. The WTO also ensures imported products are treated fairly in comparison to domestic goods. Internal taxes and other charges must not exceed those placed on domestic goods. The WTO Committee meets at least twice a year to provide Members with the opportunity to discuss Anti-dumping Agreement matters.
Need Assistance with Anti-dumping Duty?
Vara Allied provides clients with information on duties payable and any options for avoiding them. If you would like assistance with your next order, call Vara Allied on (08) 6161 8041 or contact us.