Anti-dumping, countervailing and safeguard measures

Trade remedies are trade policy tools that allow governments to take remedial action against imports which are causing material injury to a domestic industry. Such remedies are divided broadly into:

• anti-dumping measures
• countervailing measures
• safeguard measures.

These remedies are triggered in response to different situations and circumstances which may be causing injury to a domestic industry.

The following outlines the relevant World Trade Organization (WTO) rules and provides a short summary of the circumstances under which trade remedies may be invoked, and the procedures for activating their use. It also provides information on how Australian businesses can access Australia's trade remedies system.

For more information on trade remedies, including anti-dumping, subsidies, and safeguards, check out the WTO's guide Understanding the WTO – The Agreements - anti-dumping, subsidies, safeguards.

Anti-dumping measures and the WTO Anti-Dumping Agreement

Article VI of General Agreement on Tariffs and Trade 1994 (GATT), elaborated by the WTO Anti-Dumping Agreement, allows countries to take action against imports from countries allegedly exporting at dumped prices. Anti-dumping action is undertaken in response to an application from industry concerning injurious dumped imports.

An exporting company is said to be "dumping" when it exports its product at a price lower than its normal value (that is, the price at which that product is sold on the domestic market in the exporting country). When dumping causes or threatens to cause material injury to a domestic industry, remedial action may be taken.

In Australia, anti-dumping investigations are conducted by the Australian Trade Remedies Commission (ATRC).

Anti-dumping measures are imposed by the Minister for Industry and Innovation on the recommendation of the Trade Remedies Commissioner.

Countervailing measures and the WTO Agreement on Subsidies and Countervailing Measures

The WTO Agreement on Subsidies and Countervailing Measures (the Subsidies Agreement) disciplines the use of subsidies, which are generally permissible under GATT 1994 and the WTO Agreements. The Subsidies Agreement defines a subsidy as a financial contribution by a government or a public body that confers a benefit on the recipient.

The Subsidies Agreement also regulates the actions countries can take to counter the trade effects of subsidies. A country may remedy the trade effects of a subsidy multilaterally through dispute settlement procedures and thereby seek the withdrawal of the subsidy or the removal of its adverse effects.

Alternatively, a country may unilaterally launch its own investigation (known as a countervailing duty investigation) whereby an extra duty ("countervailing duty") may be imposed on subsidised imports to offset the injury to domestic producers. Where industry faces injury from subsidised imports, industry may lodge an application for the initiation of a countervailing duty investigation.

In Australia, countervailing duty investigations are conducted by the ATRC. Countervailing measures (duties) are imposed by the Minister for Industry and Innovation on the recommendation of the Trade Remedies Commissioner.

How can Australian industry apply for an anti-dumping or countervailing duty investigation?

Further information on applying for an anti-dumping or countervailing measures investigation can be found here: Apply for anti-dumping or countervailing duties (measures).

Any Australian registered business (with an Australian Business Number) that is a small or medium-sized enterprise (a business that has 200 or less full-time staff in total* ), can also access the International Trade Remedies Advisory Service (ITRA Service) for assistance.

The ITRA Service is not part of the ATRC or the Anti-Dumping Review Panel and does not act on their behalf.

Safeguard measures and the WTO Agreement on Safeguards

The WTO Agreement on Safeguards (Safeguards Agreement) provides a framework for the application of safeguard measures under Article XIX of GATT 1994.

Under the Safeguards Agreement, safeguards must:

• be temporary, emergency actions taken against fairly traded imports;
• apply in-principle to all imports irrespective of source, however there are avenues for some exclusions (for example, for certain developing countries or specific free trade agreement partners);
• be applied only to the extent necessary to prevent or remedy serious injury and to help the industry concerned to adjust; and
• be progressively liberalised while in effect.

All elements of the Safeguards Agreement and Article XIX of the GATT must be considered and met for a WTO Member to apply a safeguard measure.

Under WTO rules, Australia is also required to notify the WTO and affected countries immediately of the initiation of a safeguard investigation and its outcome. The WTO Safeguards Committee has agreed on notification formats and standards (see WTO document G/SG/1 [PDF] ).

The ATRC may recommend the application of interim safeguard measures while an inquiry is underway. A safeguard measure may only be applied on a final basis following completion of an inquiry. If the ATRC finds that the requirements for a safeguard measure have been satisfied, its recommendations are presented to Parliament by the Minister for Industry and Innovation and a safeguard measure may be applied. The Government may decide not to apply a safeguard measure, even where the ATRC has made an affirmative finding. The ATRC will publish its findings and table its report in Parliament.

How can industry seek a safeguard measure?

Further information on how to request a safeguard inquiry can be found here: Department of Industry, Science and Resources – How to request a Safeguard Inquiry

Trade remedies investigations initiated by foreign governments

Australia monitors global trade developments and assists in responses to trade remedy actions that impact our interests, such as anti-dumping, countervailing (anti-subsidy) and safeguard measures, initiated by foreign governments.

Australian businesses involved in trade remedy investigations initiated by foreign governments, or seeking further information, can email: trade.defence@dfat.gov.au.

Resources

• ‘Understanding the WTO - the Agreements: Anti-dumping, subsidies and safeguards
• WTO Agreement on Anti-Dumping
• WTO Agreement on Subsidies and Countervailing Measures
• WTO Agreement on Safeguards
• Australian Trade Remedies Commission
• Apply for anti-dumping or countervailing duties (measures)
• Safeguard Inquiry - Department of Industry, Science and Resources
• International Trade Remedies Advisory Service (ITRA Service)