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Customs issue SEF and PAD in relation to alleged dumping of HRCS from Japan, Republic of Korea, Malaysia and Taiwan: Get those securities in place!

A number of you would have been aware that we have been closely involved with the ongoing investigation by the Australian Customs and Border Protection Service ("Customs") into alleged dumping of hot rolled coil steel ("HRCS") exported from Japan, the Republic of Korea, Malaysia and Taiwan. 

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Yesterday, Customs issued a Statement of Essential Facts ("SEF") in which it set outs its preliminary views on the existence of dumping of HRCS and injury from that dumping.  Generally, Customs has confirmed its preliminary view that there has been dumping causing material injury to the Australian industry (ie Bluescope Limited) and set out proposed dumping margins between 3.3% to 15.45%.  These are not final measures and interested parties have 20 days to make submissions to Customs findings before Customs finalises its report to the Minister and the Minister imposes duties.

Of interest, in and among the other parts of the SEF, Customs has found that there was, in fact, no material injury caused by dumping of HRCS exported and used in the automotive sector in Australia but that it does not have the legislative means to terminate the investigation in relation to those exports as it can only do so for particular countries.  That does raise pressure on the Australian Government to find a means to exempt from dumping duty HRCS which is imported for use in the automotive industry.  If it does not find a way to do so, then the result could be that Australian automotive manufacturers have to pay duty on goods even when there is no injury found (at least at this stage) to the Australian steel industry. 

At the same time the SEF was issued, Customs also issued a preliminary affirmative determination (PAD).  This could have been issued by Customs as early as day 60 of the investigation but as I had anticipated, it was not issued until Customs had undertaken a more comprehensive examination such as that referred to in the SEF.  The PAD supports the imposition of "securities" by Customs on imports of HRCS from the affected countries due to the anticipated dumping.  The amount of securities will depend upon the country of export and the nature of the steel being imported.  Those securities will take effect for imports from 5 October 2012 and importers and their licensed customs brokers should now be taking immediate action to ensure that the securities are, in fact, in place to enable imports to be processed promptly.

As always, we will be pleased to assist others if required.

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