An Anti-Dumping Duty (or ADD) was imposed on specific flat rolled products of aluminum imported from China recently on December 6, 2021. The government imposed ADD on the imports, which fell under the Chapter Heading 7606 of 7607 of the First Scheduled to Customs Tariffs Act, 1975, which originated in or exported from China w.e.f on December 6, 2021 for a period of 5 years.
What is Anti-Dumping Duty exactly? If a domestic government believes that foreign imports are priced below the fair market value, they impose a protection tariff to protect their respective economy. When a company exports a product at a price that is significantly lower than the price it normally charges in its home/domestic market, this is called Dumping.
Many companies impose duties on products they believe are being dumped in their national market. This is done because they don’t want these foreign products to undercut local business and economy. While the intention of anti-dumping duties is to save domestic jobs, these tariffs can also raise the prices for local consumers. Long term, it can reduce international competition of local producers making similar goods.
An example of Anti-Dumping Duty in the US happened back in June 2015. American Steel companies filed a complaint that several countries, including China, were dumping steel into the US market and keeping prices unfairly low. As a result, one year later, the US announced it would be imposing a total of 522% combined anti-dumping and countervailing imports on certain steel imported from China.
In the final findings, the designated authority consulting Notification No 6/27/2020-DGTR, dated September 7, 2021, recommended the imposition of an ADD on the imports of the goods in question in order to remove injury to the domestic industry. In this regard, the rate of ADD would vary depending on the producers specified in the notification.
