A win for Customs in dumping duty dispute
A recent case highlights the complexities involved in ‘dumping’ duty disputes that can arise between importers and customs.
The Administrative Appeals Tribunal has ruled in favour of Customs, following a dispute with an importer about the correct classification of steel pallet racking from China.
Customs had assessed the importer for both customs and anti-dumping duties. ‘Dumping’ is the exporting of goods to a country (in this case, Australia) at a price below the normal domestic price of the goods. Anti-dumping duties are therefore an additional pecuniary-type duty on imports that are claimed to have injured Australian industry. In this particular case, the anti-dumping duty itself was assessed at 60.1%. Keeping in mind that most customs duties vary between 0% and 10% in Australia – the consequences of the issuing of an anti-dumping notice are significant.
The imported goods were steel pallet racking, specifically uprights (the frame for pallet racking) and box sections (the shelving support). The Anti-Dumping Commission (Commission) had issued a notice (in May 2019 that had retrospective effect) that declared certain steel pallet racking as being the subject of anti-dumping duty. In summary, the anti-dumping notice covered goods that are ‘like’ those described below:
Steel Pallet racking, or parts thereof, assembled or unassembled, of dimensions that can be adjusted as required (with or without locking tabs and/or slots, and/or bolted or clamped connections), including any of the following – beams, uprights (up to 12m) and brace (with or without nuts or bolts).
…
The racking layout and components used are designed to get the best efficiency for the shape and volume of the items stored. The applicable Australian Standard is AS4084-2012.
The importer argued before the Administrative Appeals Tribunal that its imports were not ‘like’ the goods described in the notice as its imported racking was not adjustable. It produced correspondence from an engineer in support of the importer’s claim that the racks it had imported did not have the feature of adjustability and, in fact, if they were adjusted they would lose their structural integrity. There was evidence, however, that the imported racks had met the Australian Standard, which in turn, referred to the goods being adjustable (the standard was specifically referred to in the Notice). The importer also argued that despite the racking being able to be assembled to meet differing heights – the component parts that were imported were not, of themselves, adjustable. Further, once assembled – the racking was unable to be further ‘adjusted’.
The Tribunal, however, found for Customs.
The Tribunal referred to there being no evidence to understand any of the claimed differing features of the imported goods to those described in the notice. Although acknowledging the correspondence from the engineer that had been obtained at the behest of the importer, the Tribunal stated that it was not in the form of an expert report (that would need to meet the Tribunal’s regulations for expert evidence). The Tribunal referred to the Commission’s material obtained during its investigation process (when first determining whether to even issue a notice) that shed light on the features of the pallet racking that was available domestically (that is sought to be protected from ‘dumping’). You can access a copy of the decision on the Tribunal’s website.
These customs disputes are highly nuanced and will turn on a thorough understanding of the imported goods compared with the goods that are the subject of a particular anti-dumping notice issued by the Commission. As the Tribunal noted here, it is sometimes necessary to lead evidence of an ‘expert’ in the relevant field to assist the Tribunal in understanding how ‘like’ the imported goods are to the ones that are the subject of a notice. While engaging an expert is a resource-intensive exercise, it may prove decisive in disputing what may be a very large duty assessment.
The case is a good reminder for importers to regularly check the Anti-Dumping Commission’s website for current and past investigations relating to goods that are or are being contemplated. You can find anti-dumping notices on the Commission’s website. There are currently a considerable number of notices issued by the Commission for goods ranging from wind towers to ammonium nitrate, and from wire ropes to A4 copy paper.
The Hall & Wilcox Transport & Trade team have specialist customs advisors. Please reach either of the contacts below.