Antidumping law?
An anti dumping law is any domestic law designed to prevent a country’s trading partners from “dumping” goods into domestic markets at any price that is less than fair. Anti dumping legislation proponents argue that these laws prevent injury to domestic industry by restricting the ability of foreign companies and countries to take advantage of unfair competitive practices.
Importance of Anti Dumping Law.
Anti dumping laws seek to recognize the reality that national economies, and the international markets in which they operate, are a variety of different rules, regulations, and laws. Companies in one nation may seek to exploit a domestic law, rule, or environment in order to flood a foreign market with goods sold at less than fair-market rates. This “dumping” of goods into the foreign market is sought to be prevented by anti dumping regulations, rules, and legislation.
Key Points
Meaning of dumping.
If a company exports a product at a price (export price) lower than the price it normally charges on its own home market (normal value), it is said to be ‘dumping’ the product.
Dumping can harm the domestic industry by reducing its sales volume and market shares, as well as its sales prices. This in turn can result in decline in profitability, job losses and, in the worst case, in the domestic industry going out of business.
Normal Value:– Normal value is the comparable price at which the goods under complaint are sold, in the ordinary course of trade, in the domestic market of the exporting country.
Export price:- The Export price of the goods allegedly dumped into Pakistan means the price at which it is exported to Pakistan. It is generally the CIF value minus the adjustments on account of ocean freight, insurance, commission, etc. so as to arrive at the value at ex-factory level
Dumping margin:- The margin of dumping is the difference between the Normal value and the export price of the goods under complaint. It is generally expressed as a percentage of the export price.
Meaning of Anti Dumping duties
Anti-dumping duties are taxes imposed on imported goods in order to compensate for the difference between their export price and their normal value, if dumping causes injury to producers of competing products in the importing country.
What Is Dumping?
Dumping is a term used in the context of international Trade. It’s when a country or company exports a product at a price that is lower in the foreign importing market than the price in the exporter’s domestic market. Because dumping typically involves substantial export volumes of a product, it often endangers the financial viability of the product’s manufacturer or producer in the importing nation.
“Country’s means any country or territory whether a member of the World Trade Organisation or not and includes a customs union or separate customs territory;
“Domestic industry” means the domestic producers as a whole of a domestic like product or those u’hose collective output of that product constitutes a major proportion of the total domestic production of that product; except when any such domestic producers are related to the exporters or imp e« s or are themselves importers of the allegedly dumped investigated product. In such a case “domestic industry” may mean the rest of the domestic producers:
- “Domestic like product” means a “like product” that is produced by the domestic Industry;
- Levy of anti-dumping duty.—The Commission shall, by notification in the official Gazette, impose anti-dumping measures on products imported into Pakistan when it determines, pursuant to an investigation initiated.
- when dumping Occurs
- Dumping occurs when a country or company exports a product at a price that is lower in the foreign importing market than the price in the exporter’s domestic market
- Meaning of Tariff
A tariff is a tax imposed by one country on the goods and services imported from another country.
- When Anti Dumping duty is Imposed in Pakistan
An antidumping duty may be impose if it is established by the investigating authority (National Tariff Commission), after due process, that: A product has been dumped into Pakistan; and. that dumping has caused or threatens to cause injury to Pakistan’s domestic industry.
- The parameters used to assess dumping of goods from a country
If the export price is lower than the normal value, it constitutes dumping. Thus, there are two fundamental parameters used for determination of dumping, namely, the normal value and the export price. Both these elements have to be compared at the same level of trade, generally at ex-factory level, for assessment of dumping.
Relevant Law in Pakistan
Anti Dumping Duties Act 2015
