Review Of A Ministerial Decision To Publish A Dumping Notice Under Subsection 269tg(1) And 269tg(2) Of The Customs Act 1901 (The Act) In Relation To Imports Of Flexible Slabstock Polyols From Singapore And The United States Of America.


1. As a member of the World Trade Organisation (WTO), Australia is bound by the World Trade Organisation Uruguay Round Anti-Dumping Agreement and Agreement on Subsidies and Countervailing Measures (the WTO Agreement). Article 2.1 of the WTO Agreement provides that a product is considered dumped, ie introduced into the commerce of another country at less than its normal value, if the export price of the product exported from one country to another is less than the comparable price, in the ordinary course of trade, for the like product when destined for consumption in the exporting country. (The export price is the price paid before any costs in respect of the goods after exportation are included. Normal value is usually defined as the price at which a good would be sold in its home market.)

2. Before any action may be taken against dumped goods the Australian industry concerned must demonstrate not only that there is dumping occurring, but that the industry has suffered material injury as a result. This is done through an application to the Australian Customs Service (Customs) for an investigation into the facts of the case. If Customs determines that dumping has occurred, it must then establish whether the Australian industry's performance has deteriorated, whether any injury suffered would be considered material and whether the dumping has caused the material injury to the industry. Any injury that has resulted from other, clearly identifiable sources must not be attributed to the dumping. Regardless of whether it is found that dumping has caused material injury, it must also be determined whether future dumping threatens to cause material injury to the Australian industry. This includes an assessment of whether any changes in circumstances would make that threat of material injury both foreseeable and imminent unless anti-dumping measures were imposed.

3. Under the provisions of the Customs Act 1901 (the Act) Customs has 155 days from the date of initiation of an investigation within which to make a recommendation to the Minister responsible for Customs (the Minister) concerning the imposition of interim anti-dumping duty. On the basis of Customs' recommendations the Minister will then make a decision whether to impose definitive anti-dumping measures.

4. The Trade Measures Review Officer (the Review Officer) is appointed by the Minister for Justice and Customs to review certain decisions in relation to dumping matters. The Review Officer is an independent administrative appeal mechanism with no investigative function. The Review Officer may review a prescribed range of decisions made by the Minister or by the Chief Executive Officer of Customs (CEO). Reviews are conducted only on application from relevant interested parties as defined in the Act under section 269ZX.

5. Subdivision B of Division 9 of the Act provides for reviews by the Review Officer of certain decisions of the Minister, including decisions to take, or not to take, anti-dumping action under subsections 269TG(1) and 269TG(2) of the Act. Subdivision B also describes the procedures to be followed in the conduct of a review.

6. An applicant must establish to the satisfaction of the Review Officer that there are reasonable grounds to warrant the reinvestigation of the finding or findings specified in the application. Section 269ZZG of the Act provides that the Review Officer must reject an application if satisfied that the applicant has failed to provide sufficient particulars in relation to the application, including particulars concerning the finding or findings to which the application relates, within the 30 day statutory period. Unless an application is so unreasonable that it may be rejected in the first instance, the Review Officer will accept it at face value and undertake an investigation. If an application is made by a party to the original decision, it will be assumed that the applicant has the right to request a review.

7. Before conducting a review, the Review Officer must publish in a national newspaper a notice indicating that the Review Officer proposes to conduct that review. Interested parties in relation to a reviewable decision by the Minister may make submissions to the Review Officer within 30 days after the publication of the public notice.

8. The Review Officer must make a report to the Minister on the finding(s) specified in the application by recommending either that the Minister affirm the reviewable decision or that the Minister direct the CEO to reinvestigate the finding(s) which formed the basis of the reviewable decision. The Review Officer must only have regard to information that Customs relied upon to make its decision and any relevant information provided in submissions by interested parties.

9. The Review Officer's report must be made at least 30 days after the public notification of the review but not more than 60 days after that notification - or such longer period allowed by the Minister in writing because of special circumstances.

10. If the Minister accepts a recommendation by the Review Officer to require the CEO to reinvestigate a finding or findings, s269ZZL prescribes that the Minister must, in writing, require the CEO to make further investigation of the finding(s) and report the result of that further investigation to the Minister within a specified period. In addition, the Minister must, by public notice, indicate acceptance of the Review Officer's recommendation, including particulars of the requirements made of the CEO.

11 . After receiving a report by the CEO in respect of a reinvestigation, the Minister must either affirm the reviewable decision or revoke that decision and substitute a new decision. The Minister must give public notice of that decision.

Flexible Slabstock Polyols

12. On 26 April 2001 following an application by Dow Chemical (Australia) Limited (DCAL), Customs commenced an investigation whether FSP imported form Japan, Korea, Singapore and the USA was being sold at dumped prices and causing material injury to the Australian industry.

13. FSP is a clear liquid used in the manufacture of flexible foam products, for example, cushioning material in furniture, bedding and carpet underlay. Customs estimated that the Australian market for FSP was valued at about $30 million in 2000.

14. Customs found that FSP imported from Korea, Singapore and the USA had been imported at dumped prices that directly caused material injury to DCAL during the investigation period. DCAL suffered significant loss of profit and profitability.

15. On 17 August 2001, Customs imposed temporary dumping duties on FSP imports from Korea, Singapore and the USA to prevent further injury to the Australian industry pending the outcome of the investigation.

16. On 28 September 2001 Customs completed its investigation and recommended that final anti-dumping measures be imposed on imports of FSP from Korea, Singapore and the USA. Shell Eastern Petroleum (Pte) Ltd (SEPL) of Singapore made an offering of a price undertaking. On the advice of Customs and after consideration by the Minister the offer of an undertaking was rejected. On 18 April 2002 the Minister accepted Customs' recommendations and declared that section 8 of the Customs Tariff (Anti-Dumping) Act 1975 applies to FSP and like goods exported to Australia from Korea, Singapore and the USA.

17. On 7 June 2002 the Review Officer published a notice in the Australian Financial Review notifying of his intention to conduct a review under section 269ZZK of the Act. The Review Officer proposed conducting a review of the Minister's decision to publish a dumping notice under subsection 269TG(1) and 269TG(2) of the Act in relation to imports of FSP.

18. Applications and submissions to the Review Officer were received from: SEPL, the Shell Company of Australia (SCOA); and Helm AG of Hamburg Germany (Helm).

19. Further submissions were received from Helm, DCAL and Dunlop Flexible Foams a division of Pacific Brands Household Products Pty Ltd of Australia.

20. The applicants challenged Customs' findings in relation to following issues:

  • - material injury;
  • - casual link;
  • - threat of injury;
  • - normal value;
  • - dumping margin; and
  • - calculation of a Non-injurious price (NIP).

21. The applicants proffered as grounds for the review that the Minister could not be satisfied that:

  • - the dumped imports from the USA have caused material injury to the Australian industry producing like goods;
  • - material injury would continue to be caused by dumped goods from the USA if those goods continued to be imported;
  • - under section 269TAE(2C) that it was appropriate to consider the cumulative effects of exports from different countries;
  • - Helm suppressed or contributed to the suppression of Dow Chemical (Australia) Limited's (DCAL) prices;
  • - Helm's pricing injured DCAL;
  • - the level of profit for calculating an unsuppressed selling price for the calculation of a non-injurious price was appropriate;
  • - sales to Dow Chemical Pacific Ltd should be excluded on the basis that such sales were not destined for domestic consumption;
  • - the purchase price of propylene sourced from Petrochemical Corporation of Singapore Pte Ltd should be rejected in assessing the cost to make and sell of FSP;
  • - the Australian industry had suffered price undercutting from imports;
  • the Australian market price for propylene oxide (PO) should be used to establish the cost of make and sell for the Australian industry; and
  • - there was sufficient evidence to establish a link between material injury and imports of FSP from Singapore.

The Shell Company of Australia (SOCA)

SOCA's claims are:

Customs Findings:

22. Following investigation into the allegations of dumping, ACS notified in the Australian daily press that it had concluded in Trade Measures Report no 43 that;

  • - there had been no exports of the goods from Japan;
  • - there have been exports of the goods at dumped prices from Korea, Singapore and the USA;
  • - the Australian industry has suffered material injury;

dumped imports have caused material injury to the Australian industry producing like goods; and

  • - material injury would continue to be caused to the Australian industry if the goods continue to be exported to Australia at dumped prices.

23. The Minister has duly accepted the ACS recommendations and has declared that S8 of the Customs Tariff (Anti-Dumping) Act 1975 apply to goods entered for home consumption on and from 17 August 2001.

Basis for Review

24. SCOA seeks a review of the decision to impose measures on Singapore, Japan, Korea and the USA for it believes that the conclusions reached by the (ACS) in its Trade Measures Report No 43 in regard to

(i) The Australian Industry and Market,

(ii) the Economic Condition of the Industry, and

(iii) Causal Link

are flawed in fact, in that, the applicant, in providing incomplete information on which it based its claims of material injury and thus causal link, did not encourage the ACS to objectively assess its claims.

25. SCOA believes that a comprehensive review inclusive of all DCAL and Dow Chemical Company, USA (Dow) commercial information that was known to both parties during and before the lodgement of the anti-dumping application would result in a finding that replicates those in two previous anti-dumping actions bought by the applicant. Those findings were that some form of dumping had occurred during the period of investigation but that there was no causal link between those dumped imports and the Australian industry producing polyols.

Further Review Information and Commentary:

26. As stated in the ACS Australian Industry visit report and at other times during the investigation process DCAL is a wholly owned subsidiary of the Dow Chemical Company of Midland, Michigan, USA .

27. It is opportune at this point to put the DCAL / Dow relationship in perspective as it will be raised later that SCOA contends that the relationship would have provided the applicant with access to more commercial information than it selectively put forward in its application and throughout the investigation

28. The Dow Chemical Company is a global science and technology based company that develops and manufactures a portfolio of chemicals, plastics and agricultural products and services for customers in 168 countries. It claims annual sales of $18 billion, conducts its operations via 14 global business and employs 39,000.

29. Dow Polyurethanes is one those 14 global businesses and DCAL is part of that business unit.

30. Dow Polyurethanes is the world's largest producer of polyols with 15 polyol plants at 13 locations, it is also one of the major suppliers of propylene oxide in the world.

The Review Officer's Assessment

31. The Review Officer having reviewed the information in relation to the application by DCAL and having regard to Customs' assessment, affirms Customs' analysis based on the information provided by the applicant.

32. The Review Officer is of the opinion that the information provided was sufficient for Customs to undertake an investigation in accordance with the provision of the Act and the applicable regulations. There is no evidence to suggest that Customs was not fully aware of the relationship between DCAL and its parent company, Dow Chemical Company of Midland, Michigan USA, nor that DCAL was selective in the information proffered in its application nor provided during the course of the investigation.

DCAL Raw Material Prices

SOCA's claims are:

33. It is accepted by all interested parties and verified by the ACS that "DCAL purchases the principal ingredient propylene oxide from its parent the Dow Chemical Company of the USA"

34. What is not accepted by SCOA and other interested parties such as Helm Ag is, DCALS claim that the Australian market price for PO should be used.

35. It is SCOA's understanding that over 99% of the Australian market for this product is supplied by Dow.

36. The ACS in addressing this matter both in the Statement of Essential Facts (SEF) at point 7.4.1 and Trade Measures Report No 43, at point 7.3.1 have based their findings on what appears to be selective applicant information, not a representative summation of the Dow position. This would have led the ACS to an incorrect conclusion.

37. SCOA challenges the ACS findings for if the ACS had been presented with the Dow parent company information that was available in a parallel dumping case in another jurisdiction and which stated

"Propylene Oxide used by Dow is produced in-house; hence to calculate the price of the product on the basis of market price is incorrect"

SCOA believes the ACS would have had cause to investigate the issue in a different way.

38. SCOA contends that DCAL as being part of the "worlds largest producer of polyols" would have been aware of the overall Dow propylene oxide (PO) position for many years and yet have chosen in their application to selectively promote the price of their own imported in-house PO as an Australian market price. Why?

39. SCOA contends that it is in DCAL's interests to have their PO prices linked to an Australian market price as it would inflate both their cost to make and sell and non injurious price claims and therefore exacerbate any material injury factors.

40. What the ACS should investigate is the direct in-house purchase price DCAL pays DOW for their PO. Such an evaluation would ensure that DCAL's injury claims are not self inflicted from a contrived and inflated intra-group transfer pricing mechanism.

41. SCOA also considers any PO price comparison to external Australian markets, namely Korea and Japan, to be superfluous to the investigation considering that the prices for most chemical products differ around the world based upon geography, manufacturing process, raw material, supply/demand, logistics costs, manpower, customer size and purchasing position.

42. Although the considered PO market prices are assumed to be in sync with the Australian market as indicated by the ACS, SCOA contends that a more detailed evaluation and understanding of those markets and who supplies the PO is needed before any objective assessment can be made.

43. In conclusion, the ACS investigation has also failed to identify that DCAL's chief raw material input cost (ie propylene oxide) is at the end of the raw material supply chain as opposed to the next upstream material propylene, and therefore it follows that DCAL's base raw material is always going to be a higher priced input than those integrated plants operating on a propylene raw material input.

The Review Officer's Assessment

44. Customs found that DCAL's purchase prices of propylene oxide were below those of other users in the Australian market during the period examined. Customs also found that the trend of DCAL's purchase prices closely followed the prices of other users of propylene oxide in the Australian market and of those prevailing in Korea and Japan.

45. Customs was not provided with evidence that indicated that its analysis of propylene oxide prices was insufficient. Customs considered all relevant information and based its analysis on documentary evidence of the price of propylene oxide supplied to other Australian users.

46. The Review Officer is also satisfied that the price paid by DCAL for propylene oxide during the period of the investigation was market related and as such affirms Customs' decision to use these prices.

SOCA's claims are:

DCAL Production Capacity:

47. Once again SCOA submits that the information the applicant has proffered in support of its application has been selective in what Dow information it would have access to.

48. DCAL has claimed that a manufacturing plant originally built in 1972 and upgraded from time to time is able to compete on a global basis with state of the art plants commissioned in the last 5 years because it is fully depreciated.

49. Its parent company Dow, directly contradicts that position by the following statement regarding Domestic production and Capacity Utilization.

"It should be noted that world scale plants for PO are typically in excess of 150,000 MTPA, while Polyol plants are generally in excess of 100,000 MTPA. PO plants being capital intensive, unless of a sufficient scale are unviable"

50. The ACS in its Trade Measures Report No 43 in addressing this issue states

"Customs notes that the DCAL Altona plant is fully depreciated. This would provide a cost advantage over newer, large-scale polyol plants where manufacturing expenses would include significant financial and depreciation costs"

51. The ACS assumption regarding a cost advantage of a 30 year old, 30/35 ktpa plant gained over a 4 year old 100 ktpa plant is naive at best. At worst it flys completely in the face of any economic principal regarding global economies of scale. Any such conclusion warrants a more thorough and detailed investigation.

The Review Officer's Assessment

52. The Review Officer is only able to reach a conclusion based on the information that was before Customs in finalising its recommendations to the Minister. Any information relating to issues that were not considered by Customs in its original investigation can not be considered in the course of conducting this review.

53. The issue of capacity and efficiency of the DCAL Altona plant was considered by Customs. The Final Findings Report noted that there was no evidence to support the claim by parties that overseas polyol plants experienced a greater level of efficiency. Having assessed the relevant information, the Review Officer affirms Customs' assessment of DCAL's production capacity and does not believe that DCAL was selective in the information it proffered to Customs in its application.

SOCA's claims are:

Price Undercutting:

54. The ACS in its assessment of this area relating to price effects have "noted that the prices for FSP from all sources moved within a narrow band"

55. Rather than continue to investigate this natural Australian market constraint the ACS has failed to pursue the matter further and instead conclude on the evidence provided that the Australian industry has suffered price undercutting from imports of FSP. This conclusion is flawed both in logic and fact as the independent evidence that SCOA and other interested parties placed before the ACS during their investigation relating to the particular vagaries of the Australian market, principally the narrow band of selling price that is attributable to the capping imposed by the import parity price of fully built up upholstered furniture on ALL segments of the Australian polyol market, was ignored.

The Review Officer's Assessment

56. Customs' assessment of price undercutting indicated that selling prices of imported FSP from Korea, Singapore and the USA were at times lower than Australian industry selling prices. The undercutting occurred over each quarter of the investigation period from one or more of the export sources. The evidence supports Customs' assessment of price undercutting.

57. While there may be evidence to suggest that there is a narrow band of selling prices, the evidence indicated that imports of FSP undercut the selling prices of the Australian industry. The Review Officer affirms Customs' findings that it was satisfied that the prices of these imports undercut the Australian industry selling prices.

SOCA's claims are:

The Economic Condition of the Industry / Causal Link:

58. As in all ACS dumping actions, the central question before Customs in this matter is whether dumping has caused, or threatens to cause, material injury to the Australian industry and whether that material injury can be described as "injury which is greater than that likely to occur in the normal ebb and flow of business"

59. SCOA contends that all the principal economic factors for material injury and causal link examined by the ACS both in the period of injury and the investigation period can when viewed in the light of the information that DCAL should have been cognizant of and provided to the ACS in it's application be assigned to the normal ebb and flow of the global market pricing of polyols, and which have in the period of injury and recent times been at the bottom of the normal international pricing cycle.

60. The impact of the above international pricing cycle has been felt not only by the applicant but all the interested parties.

The Review Officer's Assessment

61. Having regard to all the information assessed by Customs in its analysis of material injury and causal link, the Review Officer is of the opinion that Customs' finding that the Australian industry suffered material injury as a result of dumped imports from Korea, Singapore and the USA should be affirmed.

62. The Review Officer is not able to hypothesis on whether, information that was not considered by Customs that an interested party believes should have formed part of Customs' examination, would have resulted in an alternative finding. The Act is very clear on information that the Review Officer can have regard being defined as 'relevant information'.

'Relevant information means: ?the information which the CEO had had regard or was, under paragraph 269TEA(3) of the Act, required to have regard, when making the findings set out in the report under section 269TEA to the Minister..'

The Shell Eastern Petroleum (Pte) Ltd Singapore (SEPL)

SEPL's claims are:

Domestic sales - treatment of certain sales to Dow Chemical Pacific Ltd. ("DOW")


63. xxx is SEPL's largest volume customer for FSP sales in Singapore. SEPL's selling prices to Dow in the period of investigation xxxxxxxxx than for other customers.

64. In the assessment of domestic sales for normal value determination Customs excluded the Dow sales on the basis that it could not be satisfied that such sales were xxxxxx. The following reasons were proffered for this decision:

i. There is xxxxxx between SEPL and xxx;

ii. The xxx address on sales invoices is in xxxxx;

iii. The sales invoice xxxxxx;

iv. The sales terms to xxx are consistent with other export sales; and

v.The normal value report inferred that the goods (in such sales) xxxxx.


SEPL explanation of the above issues

65. SEPL responded to the SEF on each of these issues, summarised below:

i. SEPL advised Customs that there was xxxxxx in place between xxxx. In any event, the matter of an agreement is irrelevant to determine the status of sales as either xxxxxx.

ii. While the xxx address on sales invoices is in Hong Kong, the domicile or billing address does not signify whether the business or use of product by Dow in Singapore is for domestic or export sale. Again, the billing address is irrelevant.

iii. The sales invoice to xxxx did not include a xxxx because it was billed separately, xxxx. While the 'field' officers conducting the normal value investigation did not request or verify xxxxxx, SEPL subsequently made copies available to Customs to evidence the Dow orders and charge xxxx.

iv. FSP is manufactured by SEPL on Jurong Island, an island located just off the Singapore mainland. Prior to 1999 all movements of product for domestic and export sale were by ship, either to the Singapore mainland or export country destination. There was no bridge or land link between the island and the mainland.

While a land link is now available, SEPL ships product to its mainland storage facility at the Shell Pandan tank terminal for sale and distribution to customers. Sales xxxxx, is characterised in shipping terms as xxx as the xxxx.

The xxxx terms in the xxx sales only define the method of transport and the contractual obligations of the parties involved. Nonetheless, in these instances, a reference to xxxx terms may have lead Customs to incorrectly identify the xxxx sales as being for export.

v. SEPL advised the Customs field officers in Singapore that details of the Dow customer base was unknown to SEPL. Further, while Dow takes product into store in Singapore, it is free to export that product.

As further evidence to assess the bona fide nature of the xxxx sales, SEPL provided data from xxxx.

The statistics provide import and export volume and value. They indicate the amount of domestically produced FSP which is exported and by cross referencing with FSP produced by SEPL, the volume which is sold domestically can be derived. This volume was able to be aligned with the volume identified and verified by the Customs field officers as being sold on the domestic market in Singapore, which volume included certain sales to xxx.

Customs Final Report decision

66. The Final Report states at 5.4.2 that:

"Following the SEF, Shell Singapore (SEPL) submitted that the conclusions reached by Customs in excluding the claimed major domestic customer were incorrect. Customs re-examined the issue in the context of the explanations provided. While it is possible that some sales to the particular customer were used for home consumption in the Singapore domestic market, Customs found no reliable information to identify such sales. Therefore, Customs has continued to exclude the sales to this customer from the domestic sales analysis."

Appeal claim

67. SEPL is not in a position to know the destination of each tonne of its product sold to xxx. To expect that it should have that knowledge would be plainly unreasonable. On the evidence available to SEPL and provided to Customs, the only reasonable conclusion that can be drawn, in our view, xxxx.

68. The evidence presented by SEPL is the only factual evidence upon which a conclusion can be reasonably based. While Customs say that "it is possible that some sales ?were xxxx" it would have been more logical, from the available evidence, to conclude that the opposite was true. That is, that it was possible that some sales were destined for the xxxx.

69. To our knowledge Customs is not in possession of any contrary factual evidence to disprove that which was provided by SEPL. In the circumstances Customs should have included the sales to xxx in xxxx and normal value calculations.

70. The inclusion of the xxx sales has the effect of reducing the normal value and therefore the size of any resultant dumping margin.

The Review Officer's Assessment

71. Customs considered all the information and evidence provided by SEPL and based on its assessment decided to exclude sales to one of SEPL's major domestic customers after concluding that these sales were destined for the export market. Customs further indicated that it could find no reliable information to identify that SEPL's claims that sales to DOW were for consumption in the Singapore domestic market.

72. The Review Officer is of the opinion, having considered the evidence in relation to the sales to DOW that, Customs' finding excluding these sales from consideration of domestic sales in Singapore, be affirmed. The Review Officer is only able to assess the information that Customs' relied upon and is satisfied that Customs' exclusion of those sales to Dow was reasonable and in accordance with the Act.

SEPL's claims are:

Cost to make - Propylene


73. Propylene oxide, the major raw material ingredient in the manufacture of FSP, is produced from propylene purchased by SEPL from xxxxx.

xxx is equally owned by SEPL and the xxxx.

74. Customs legislation provides that an exporter is entitled to purchase raw material inputs provided that the purchase is arms length. Where a major input is produced by an associate of the exporter, Customs compares the cost against normal market prices for such a product in that country. If there is a significant variance to normal market costs then Customs may substitute that normal market cost in the cost to make and sell verification (of the FSP).

75. Customs takes into account the normal market cost to ensure that the cost of the input from the associate is reasonable.

76. In ascertaining the normal market cost Customs takes into account the size of the market and purchasing behaviour of the exporter. For example, if the exporter buys "on the spot" then that may be considered the normal market. If the exporter buys under long term contracts then the price obtained under those contracts is the normal market price.

77. Customs field verification visit to SEPL

78. The Customs field officers examined the contractual arrangements between PCS and SEPL and verified:

  • - xxxx the same as for the other PCS customers (including the unrelated party); and
  • - the price paid by SEPL was arms length.

Statement of Essential Facts (SEF)

79. When the SEF announced that Customs was still considering the acceptance of the SEPL purchase price form propylene, SEPL made further representation to Customs on this matter.

80. SEPL again explained the xxxxx. In particular, SEPL outlined the following guide on the vagaries that can affect international pricing and, importantly, can produce different pricing results between markets:

  • - The prices of most chemical products differ around the world based upon geography, manufacturing process, raw materials, supply/demand, logistics costs, manpower costs, customer size and purchasing position.
  • - The various manufacturing processes to make propylene require different raw materials and different assets and investments. The primary routes being via gas crackers, naptha crackers and refinery extraction.
  • - The USA manufacturing of propylene is based on several processes, with many related to gas cracking. The shortage of gas in the USA (at the time) and subsequent high gas prices and a consequent impact on electricity costs and availability (which received significant press coverage), had a direct influence on the cost to produce and therefore price of propylene in the USA.
  • - The gas and propylene logistics in the USA are primarily by pipeline with lower costs from propylene production to end users. These pipeline costs are lower than if transported by ship.
  • - Propylene prices for customers in Korea and Taiwan are based on imported/shipped naptha or imported propylene, therefore, having different logistics, raw material and process costs than the USA.
  • - In Singapore the propylene source is from a local naptha cracker which is supplied naptha by pipeline from a local refinery. The pipeline logistics costs from oil refinery to cracker, to propylene supply to SEPL, mean logistics costs are very low compared to Korea and Taiwan (for example).
  • - Raw material supply availability was not low or short in Singapore, unlike the gas situation in the USA.
  • - Prices for propylene in Singapore are therefore different than those in Europe, Korea, Taiwan or the USA and cannot be compared against these other markets.

The Final Report

81. The Final Report gave notice that the SEPL price was rejected.

82. The reason given for the rejection was that propylene was sourced from an xxxxxx.

83. Despite the field officers being satisfied with the arms length and market based nature of the propylene purchase price, and the subsequent representation from SEPL, an arbitrary decision was ultimately made to reject that price. The SEPL purchase price for propylene was replaced with a market price "based on independent market data published internationally".

Appeal claim

84. SEPL appeals the decision by Customs to reject its propylene purchase price, on the following grounds:

i. The first test to be applied in this matter is to compare the SEPL purchase price for propylene with normal market prices in Singapore. The field officers performed this test and were satisfied that the price from PCS to SEPL was similar to the price for propylene paid by Singapore Acrylic Pty Ltd to PCS. That is, a Singapore market price paid in an arms length transaction to an independent party.

ii. On this basis it was inappropriate for Customs to look outside the Singaporean market when it could have reasonably used a market price found in Singapore.

iii. Customs should only have replaced the SEPL price for propylene when the above tests failed. However, SEPL's response to the SEF on this matter enunciated the vagaries of costs and prices for propylene between international markets. For this reason it was too simplistic for Customs to substitute a propylene price from published data.

iv. Customs has made an arbitrary decision in this matter which was ultimately against the satisfaction and acceptance of the field officers in Singapore.

85. xxxxxx.

86. By retaining of SEPL's price for propylene more of these sales would comply with the ordinary course of trade test and would be included with other profitable domestic sales for normal value consideration. In turn, the weighted average normal value would be lower and so too, the dumping margin.

The Review Officer's Assessment

87. Customs acknowledged in its SEF that there were sufficient domestic sales by SEPL of the like goods in the ordinary course of trade during the period of investigation. This was based on a comparison of net selling prices with the cost to make and sell of like goods. Customs also noted in its SEF that, at that time it was seeking further evidence to establish whether these raw material prices used to establish a cost to make and sell reasonably reflected market prices.

88. In situations where an exporter sources its inputs from an associated company Customs compares the cost of such an input with normal market prices for such a product in that country in order to ascertain whether that cost can be considered reasonable. Having assessed independent market data published internationally, Customs was unable to accept SEPL's cost of its propylene as being market related.

89. Having further analysed all relevant information, Customs determined that SEPL's supplier of propylene was an associated company therefore Customs replaced the cost of propylene used by SEPL with a market price. Customs was unable to be satisfied that SEPL's purchase price of propylene was market related. It should be noted that Customs' decision was firstly not an arbitrary one and secondly was not against the satisfaction and acceptance of the Customs' Field Officers in Singapore.

90. The Review Officer affirms Customs' decision to replace SEPL's cost of propylene with a market price based on independent market data.

Helm Ag (Helm) Of Hamburg Germany

Helm's claims are:

Material Injury - Main Issues

91. The essence of Helm's argument that there is warrant for the reinvestigation of the Minister's decisions and findings is that imports of FSP from the USA did not cause material injury to the local industry producing like goods. Helm is not aware of the facts relating to whether Bayer's export prices were or were not dumped but submits that, in the absence of material injury and causal link, dumping export prices alone do not justify the publication of a dumping duty notice.

92. Helm invites the Review Officer to read its submission of June, 2001 and its response to the ACS's Statement of Essential Facts (SEF), as well as Mr Phil Harris' submission and the statement by senior executives of Joyce Corporation Ltd and Dunlop Flexible Foam to the effect that Helm had not undercut DCAL's prices for polyol (see Attachments to Helm's response to the SEF).

93. Helm, like its predecessors in the operation of its polyol business has for years pursued a policy of not injuring the local industry (Helm submission, June, 2001, s. 3.2.3, p.7; Mr Harris' submission [ Mr Harris conducted the USA polyol business in Australia for Union Carbide, Arco Chemical, and Lyondell in succession for over a decade]).Helm [and its predecessors] has deliberately sought to ensure that its prices have not undercut DCAL's prices and to limit its market share to around 20 per cent.

94. Customs claims to have found "occasions" where the Helm selling price undercut that of DCAL in the period of the investigation (ACS Report, s.6.3.1, p.21). Helm does not believe this to be so but has been denied (in its submission, wrongly and unlawfully) information relating to those alleged instances. Helm contends that even if there had been an instance or instances of its price momentarily being lower than DCAL's price, unless that price configuration inflicted material injury on DCAL the publication of a notice is not justified.

95. The review officer is invited to consider the "appropriateness" of the cumulative approach to the finding of injury: whether such a finding was made and, if so, whether it should be reinvestigated. It is Helm's submission that if no such finding was made then the adoption of that approach was contrary to subsection 269TAE(2C) of the Customs Act.

96. Helm contends that the cumulative approach taken by the ACS and (apparently) by the Minister was inappropriate and unsound and led it and the Minister into error.

97. Helm also contends that the analytical approach to injury assessment taken by Customs was unsound: specifically that it treated assumption as fact. It was therefore unreasonable and therefore unlawful.

98. All of these issues are addressed more fully below.

Helm's claims are:

Assumption Treated As Fact

99. In Australian Customs Dumping Notice 2001/21, the ACS advised that the period of investigation is from 1 January 2000 and an "injury period" is from 1997. In its SEF (section 6.1, p.18), Customs stated, in a context of injury, that it had gathered information in respect of 1996 also. In its response to the SEF (pp. 5-6), Helm pointed out that evidence, if any, of dumping after 1 January, 2000 is in no way evidence of dumping prior to that date and back to 1 January 1997.

100. In its Report (section 6.1, p.20), Customs refers to "some confusion about the distinction between the period of investigation and the period of injury". Customs mentions s.269T(2AD) as allowing the Minister to examine periods outside the nominated investigation period for the purpose of determining material injury and said: "This longer period allows an assessment of injury over several years and places the claimed material injury during the period of investigation in context".

101. Customs said (loc. cit.): "The assessments of dumping and of material injury during the period of investigation remain the basis for examining any causal linkage between dumping and material injury.

102. Helm would observe that there is indeed some confusion in distinguishing between the investigation period and the so-called "injury period" but it is Customs which is confused.

103. There are particular references to periods outside the investigation period in the following Report sections:

6.3.2 - Price depression

6.3.3 - Price suppression

6.4.1 - Profit

6.4.2 - Profitability

6.5.1 - Market size

6.5.2 - Australian industry sales

6.5.3 - Import volumes

6.5.4 - Market shares

6.6.1 - Degree of capacity utilisation

6.6.2 - Return on investment

6.6.4 - Employment

6.6.5 - Inventories

7.2.2 - Price Effects

7.2.3 - Volume Effects.

104. In all instances, and despite Customs' claim to have assessed dumping and material injury during the investigation period as the basis for examining causal linkage, periods outside the investigation period are discussed in the listed sections as if they are relevant.

105. A striking example of this is to be found in section 7.2.2 of the report. Customs says (p.33):

"Customs found that the Australian industry faced a declining margin between its costs and selling prices after 1996 Despite increased costs, Customs found no reason that DCAL was not able to increase its selling prices to compensate - other than the price competition in the market. This price suppression was consistently evident during the period of investigation. The effect of the price suppression flowed through to the significant decrease in profits suffered by DCAL since 1996 This decrease resulted in a significant loss in 2000. In a similar way the profitability of DCAL for its FSP domestic sales also declined significantly over the same period. "

106. Customs' conclusion (loc. cit.) is explicitly expressed to arise "from the above".

107. Helm for one denies that it suppressed or contributed to the suppression of DCAL's prices since 1996.

108. The fact is that the period from 1996 to 2000 was not fully investigated.

109. Helm contends that subsection 269T(2AD) affords no license for the Minister to ignore his obligation under subsection 269TAE(2A) to consider, in making a determination for the purposes of section 269TG, whether any injury to an industry is being caused or threatened by a factor other than the exports in question. Helm can readily see how an examination over a longer period might place the claimed material injury in context by demonstrating the effects of "other factors" but it cannot see how the obligation to causally link alleged material injury to evidenced dumping to the exclusion of other factors could lawfully be avoided.

110. Another gross example of Customs treating assumption as fact is to be observed in section 7.2.3 of the Report. Customs gives as its reason for not accepting the Korean importer's argument that it had increased its market share at the expense of other importers (as indeed it did, as Helm knows to its cost) that:

" all importers and the Australian industry were aiming to maximise their FSP sales"

111. This might have seemed to Customs to be a plausible behavioural hypothesis but it is no more than assumption and it is simply untrue in Helm's case. The TMRO is invited to examine the records of the two previous dumping cases, both cited by Customs, the evidence given on this point by Helm, by its customers, and by Mr Harris as well as the market share data presented in the Report (section 6.5.4, pp.2728). Helm feels entitled to observe that it does not appreciate being the subject of such an untruth.

112. In Helm's submission, the analytical procedure adopted by Customs, and apparently accepted by the Minister, is unreasonable in that assumption is treated as fact and it is unlawful for that reason. In addition and equally important, in failing to consider the matters required to be considered under subsection 269TAE(2A) the Minister is in breach of the Customs Act.


The Review Officer's Assessment

113. Under section 269TAE(2A) of Act, Customs must consider whether detriment has been or is being caused by factors other than the dumped imports and no part of the detriment caused by factors other than the dumped imports must be attributed to the dumped imports. It appears that section 269TAE(2A) of the Act operates in the context of determining material injury under section 269TAE of the Act and the matter to be determined is whether material injury has been or is being caused by dumped imports and not the cause or extent of detriment from other factors per se of itself.

114. Customs concluded that the Australian industry has suffered material injury during the investigation period. Customs further concluded that the material injury occurred through price undercutting and price suppression and this caused a substantial loss of profits to the Australian industry in the period. Customs concluded that the price pressure was due to the imports of FSP at dumped prices from Korea, Singapore and the USA during the period of investigation.

115. The Review Officer affirms Customs' assessment of causal link and material injury and also affirms Customs' investigation period as being in accordance with the Act, and that Customs' assessment was based on the evidence provided, during the course of its investigation

116. The Review Officer is of the opinion that Customs analysis was based on all relevant information relating to the investigation period and was not based on any assumption nor conjecture.

Helm's claims are:

Analytical Inconsistencies

117. In section 7.2.2 of its Report (p.32), the ACS said:

"... Customs found that price is the major determinant of demand for FSP in the Australian market. Customs noted that all FSP prices during the period of investigation were closely grouped. Accordingly, it is reasonable to conclude that market share is predicated on a low selling price. [emphasis added] "

118. Helm has no quarrel with Customs' hypothesis nor with its conclusion. However, the review officer is invited to ask himself. "How can the alleged price undercutting by Helm be reconciled with Helm's loss of over half of its market share in the investigation period?" (see Helm submission, section 3.2.1, p.5; SEF, section 6.3.4, pp.25-26 esp. graph p.26; Helm's Response to the SEF, pp.6-7; Report, section 7.2.3, pp.33-34).

119. In addressing Helm's response to the SEF on this issue Customs, having postulated a functional relationship between pricing and market share, switches variables to the irrelevant variables of Helm imports' share in total imports and the (remaining) quantum of Helm imports after the loss of more than half of its market share.

120. Either the functional relationship between pricing and market share exists or it does not. If it does exist, the inconsistency in Customs' analysis remains to be explained.

121. Such a functional relationship must be commutative, so that Helm's loss of over half of its market share must, on Custom's reasoning, imply relatively higher selling prices by Helm. Certainly, without a valid reconciliation of this factual and analytical inconsistency, the Minister could not properly be satisfied that Helm's pricing injure DCAL.

The Review Officer's Assessment

122. The Review Officer affirms Customs' finding that imports of FSP from the USA undercut the selling prices of Australian industry. The Review Officer also affirms the assessment that Helm's pricing caused material injury to the Australian industry.

Helm's claims are:

Helm Pricing - The Facts

123. In its "Conclusion" (Report, section 7.4, p.36), The ACS ascribes material injury to price undercutting and price suppression. These are said to have caused loss of profits during the period of investigation.

125. The ACS has refused to provide any information relating to these alleged instances. This denial of natural justice by Customs and the breach of the WTO AntiDumping Agreement (Articles 6.2 and 6.4) it involves are discussed in a separate section below.

Helm has contended that it did not undercut DCAL's prices; Helm's two relevant customers have stated the same thing (see Attachments to Helm's response to the SEF). Mr Harris gave evidence of his long-standing non-injurious pricing policy and Helm stated in its submission (Submission, sections 3.2.3, 3.2.2, 4) that it continues to apply its non-injurious pricing and market share limitation policies. All of this evidence was given in the full knowledge of the obligation to be truthful in the provision of evidence. Helm regards the manner in which the ACS has treated all this evidence as arbitrary and capricious - and therefore unlawful.

126. Helm is, of course, labouring under extreme difficulty, having been denied details of the alleged instances of price undercutting. In speculating, as it must, as to how Customs should have thought that it had observed price undercutting by it, Helm is sparring with shadows. Nevertheless, Helm believes that it can see how Customs may have misled itself (and the Minister).

127. It is clearly established that:

  • - all FSP prices were in a narrow band over the period of the investigation (Report, section 7.2.2, p.32);
  • - from Q.3 of 2000 to Q.4 of 2000 and from Q.4 of 2000 to Q. l of 2001 prices rose substantially (Report, section 6.3.3, p.23);
  • - for compelling reasons stated in the report, foam makers usually operate on quarterly pricing arrangements (Report, section 4.3, p.l 1); and
  • - there is no evidence that DCAL's quarterly price quotations and Helm's quotations were synchronous. Indeed, helm's policy of pricing at or above DCAL's prices (Submission, section 3.2.3, p.7) required that Helm quoted prices after DCAL had done so.

128. Therefore, if Helm made a delivery on a contract at a time when DCAL had made a new contract at a higher price, Helm's price for its delivery could be lower than DCAL's price. Such a price configuration would be non-injurious in that it would be paid by the purchaser in the knowledge that Helm's price would also rise when Helm's next contract is negotiated. If Customs compared contract prices which were in fact not comparable, its comparison would be invalid.

Footnote 8 to Article 2.4.1 of the WTO Anti-Dumping Agreement says:

'Normally, the date of sale would be the date of contract, purchase order, confirmation, or invoice, whichever establishes the material terms of sale.'

129. In context of currency conversion for the purpose of price comparison, the Customs Act provides (s.269TAF(1)) for the comparison to be made ' on the date of the transaction or agreement that, in the opinion of the Minister, best establishes the material terms of the sale of the imported goods".

130. Plainly, if the quarterly contracts, characteristic of this industry and duly noted by Customs (Report section 4.3, p. 11), establish the material terms of sale then price comparisons based on delivery invoice dates are invalid.

131. The Review officer is invited to verify from Customs price comparison data how Customs concluded that Helm undercut DCAL, in the face of so much evidence to the contrary.


The Review Officer's Assessment

132. Customs ascertained that Helm had in fact undercut the selling prices of DCAL in the period of investigation. The Review Officer having considered the evidence affirms Customs' finding that Helm's selling prices were lower than the selling prices of DCAL.

Helm's claims are:

Cumulation Of Injury

133. The ACS had concluded in the SEF (section7.3, p.29) that in accordance with s.269TAE(2C) it would be appropriate for the Minister to consider the cumulative effect of the dumped exports from the different countries for the purposes of assessing any causal link with the material injury suffered by the Australian industry. The subsection gives effect to Article 3.3 of the WTO Anti-Dumping Agreement. Subsection 269TAE(2C) requires that for the purposes referred to in subsections (1) and (2) [whether material injury has been caused or is threatened] the Minister should consider the cumulative effect of exports from different countries only if, having regard to

a. the conditions of competition between those goods; and

b. the conditions of competition between those goods and like goods that are domestically produced

the Minister is satisfied that it is appropriate to do so.

134. Whether the Minister has found himself to be so satisfied is unclear. In section 9.1 of its Report, the ACS enumerates "Matters for which the Minister must be satisfied". Satisfaction in accordance with s.269TAE(2C) as to the appropriateness of cumulation is omitted from that list. Since, in the absence of such satisfaction the Minister is precluded from having regard to cumulative injury, and the Report, to which the Minister has had regard, sets out findings based on cumulation, Helm contends that the Minister's findings and determinations, as they relate to imports from the USA are unlawful and invalid.

135. Helm addressed the issue of the inappropriateness of the cumulation of injury in its response to the SEF (Response, pp. 1-2 and p.7).

136. In its SEF (section 7.3, p.29) and in its Report (section 7.2.1, pp.31-32) Customs advanced five statements in relation to the imported and local goods, vis, that the goods:

  • - were present in the Australian market throughout the period of the investigation;
  • - were generally sold through the same distribution channels;
  • - were sold in the same geographic regions;
  • - were interchangeable with each other.
  • - were a generic type standardised product generally manufactured to industry standard.

137. It is submitted that the above comments on the goods and not comments on the 'condition of competition' to which the Minister is required to have regard. As well as being irrelevant, the comments are meaningless. The first three are to the effect that the imports and local products were sold in the same market at the same time, as they would have to be for this case to exist and the last two amount simply to the fact that all the goods, which they have to be in a single dumping investigation. None of the comments is related or is relevant to whether or not injury should be cumulated.

138. Omitted from consideration are such considerations as whether there were a number of exporters all competing in the same manner and all contributing to cumulated injury. Other obligatory considerations such as whether cumulation of injury is fair to all parties and whether the process leads to conclusions that are unreasonable or are untrue for some exporter(s) were also overlooked.

139. Helm contends that the cumulation of injury in assessing causation has no proper basis and fatally flaws both the report and the decisions, determinations, and findings arising from it, as arise they did.

140. There is a whole series of statements in the Report each of which is presented as relating to imports generally but which is demonstrably untrue in the case of imports from the USA. Two examples are:

1. Section 6.5.3 : "Total imports of FSP from the countries under investigation increased significantly in 1998 and have grown steadily each year since then. "

Without prejudice to Helm's contention that what happened outside the investigation period is irrelevant, the truth, as far as the USA is concerned, is that imports from the USA decreased in 1998, increased slightly in 1999 and fell substantially in both 2000 and 2001.

2. Section 6.5.3 : "Over the four year period to 2000, Customs found that the total imports of FSP had more than doubled"

Again, without prejudice, the truth in relation to imports from the USA is that, far from doubling, these fell by about one quarter.

141. In both of the above cases, Customs later separately described the situation in relation to the USA but this does not remove the misleading effect of the above and other references to imports in general.

142. For the reasons set out above, it is Helm's submission that the Minister's satisfaction of the appropriateness of cumulation, if he had been satisfied, would have been just as ill-based as Customs' conclusion that cumulation was appropriate.

143. Helm repeats its contention that there is no evidence that the Minister addressed that relevant matter.

The Review Officer's Assessment

144. Customs, in accordance with section 269TAE(2C) of the Act was satisfied that, it was appropriate for the Minister to consider the cumulative effect of the dumped exports from the different countries during the period of investigation for the purpose of assessing causal link with the material injury suffered by the Australian industry.

145. The Review Officer does not believe, having considered the evidence that it was inappropriate for the Minister to consider the cumulative effect of dumped exports. The Review Officer affirms Customs' decision to cumulate the effect of dumped exports.

Helm's claims are:

Denial of Natural Justice

146. Natural justice requires that a party is entitled to be made aware of evidence against that party. The WTO agreement provides (Article 6.4) that all interested parties shall have a timely opportunity to see all information that is relevant to the presentation of their cases, that is nor confidential as defined in paragraph 5 [of Article 6], and that is used by the authorities in an anti-dumping investigation, and to prepare presentations on the basis of this information.

147. Helm has been denied this opportunity.

148. After requesting to be provided by Customs with details of the instances of its alleged price undercutting, Helm[A.E. Sharkey on its behalf) was advised by e-mail of 16 August (see files):

"... it is difficult to provide any indication of the transactions concerned without breaching confidentiality. This occurs because we found that all market prices were within a narrow band.

If I [Mr Roux, Director] was to indicate that sales to a certain customer undercut the Australian industry, this would effectively identify the selling price of the Australian industry. If I do that for one importer, I am obliged to extend that to all others (importers and Australian industry) - if asked.

In these circumstances I prefer to protect the confidentiality of the price information from all parties. Accordingly I am unable to provide any further price information. "

149. Concerning the "narrow band", this was disclosed in the SEF (section 6.2.1, p.19), in the e-mail itself, and later in the Report (section 6.3.1, p.21). If the narrowness of the band implies disclosure then Helm already knows from its own prices the approximate DCAL prices. Other sellers have the same knowledge. To simply identify the specific Helm sales which allegedly undercut DCAL in price amounts to no further material disclosure. Further, there is no way the any other party's business or commercial interests (s.269ZJ(2)) would be affected by Helm being told of those occasions on which it allegedly undercut DCAL.

150. Equally importantly, the so-called "proliferation argument" is a totally discredited reason for the denial of anything. The judicial denunciation of that argument has consistently run along the lines "Yes; and if a person is entitled to that thing he should have it and everybody else similarly entitled should have it as well."

151. It is a matter of profound regret to Helm that it should be confronted with this unlawful consideration, which seems to emerge like some phoenix from the ashes of its repeated judicial rejection. It is simply unlawful, as the Review Officer must be aware.

152. In Helm's submission, the investigation in this case is fatally tainted by the denial of natural justice to Helm.

The Review Officer's Assessment

153. It has been Customs' policy to protect the confidentiality of the price information from disclosure to all parties. Customs does not discriminate on the basis of which party is afforded the information rather its policy is implemented such that, confidential information is not provided to any interested party. In this case neither to the importer nor to the Australian industry.

154. The Review Officer affirms Customs' decision not to provide confidential information to interested parties in line with its own policy of disclosure.


Helm's claims are:


155. The decision to publish a dumping duty notice under s.269TG(2) is a decision based on the Minister being satisfied that material injury is threatened in the future. Both the WTO Anti-Dumping Agreement (Articles 3.7 and 3.8) and the Customs Act (s.269TAE(2B)) impose strict conditions to be complied with before a finding of threat can lawfully be made.

156. The WTO agreement says (Article 3.7):

"A determination of a threat of material injury shall be based on facts and not merely on allegation, conjecture or remote possibility. "


"The change in circumstances which would create a situation in which the dumping would cause injury must be clearly foreseen and imminent. "

157. The last-mentioned requirement is enacted in s.269TAE(2B) of the Customs Act and binds the Minister. By virtue of the application of s.269ZZ of the Act, which requires the Review Officer to have regard to the same considerations as the Minister, it binds the Review officer in the same way.

158. The WTO Agreement (loc. cit.) presents some examples of factors which the authorities should consider, inter alia. These are:

i. a significant rate of increase of dumped imports into the domestic market indicating the likelihood of substantially increased importation;

ii. sufficient freely disposable, or an imminent, substantial increase in, capacity of the exporter indicating the likelihood of substantially increased dumped exports to the importing Member's market, taking into account the availability of other export markets to absorb any additional exports;

iii. whether imports are entering at prices that will have a significant depressing or suppressing effect on domestic prices, and would likely increase demand for further imports; and

iv. inventories of the product being investigated.

159. The Review Officer is invited to take these considerations seriatim in relation to exports from the USA and to consider for himself to what conclusion they lead in the light of relevant evidence.

As to any "significant rate of increase of dumped imports" from the USA, the fact is, as Customs found, that imports of FSP from the USA decreased, rather than increased (and decreased significantly) during the period of investigation (SEF, sections 6.3.3 and 6.3.4, p.25; Report, sections 6.5.3 and 6.5.4, p.27; Helm Submission, section 3.2.1, p.5; DCAL Application, p.20).

160. The second consideration (ii, above) was not established as a ground for apprehension of injury. The fact is, the possibility of some increase in Bayer's capacity was not even addressed. It falls into the category of conjecture or remote possibility - both precluded from consideration. There is not a scintilla of evidence to suggest any apprehension on this score which means that in accordance with s.269TAE(2B) and s.269ZZ it should not have been taken into account by the Minister (as apparently it was not) and must not be taken into account by the Review Officer.

161. Concerning iii, above, the ACS was unable to conclude that there was any price depression in the period of investigation (Report, section 6.3.2,pp 22-23). After saying, "Customs concludes that the Australian industry had suffered price depression in the period from 1996 to 1999 [which Customs did not investigate], Customs said: "However, the price depression was alleviated with marginal increases in selling prices in 2000 and a further rise in the first quarter of 2001.'

162. The marginality of price increases in 2000 does not detract from the fact that prices did not fall in 2000 and the 'further' rise in 2001 is equally inconsistent with price depression. The year 2000 and Q.1 of 2001 comprise the investigation period. The Review Officer is reminded that "price depression occurs when an industry, for some reason, lowers its prices" (SEF, section 6.2.2, p.19; Report, section 6.3.2, p.22). The review officer is also invited to note the omission of any reference to price depression in section 6,7 of the Report, "conclusion", (p.29). There was no price depression.

163. As to prices being suppressed by imports from the USA, this issue is addressed in Section 5 of this submission: "HELM PRICING - THE FACTS", above. Helm contends that if DCAL's prices were suppressed, they were not suppressed by imports from the USA.

164. Concerning inventories of the product being investigated (example iv, above), Customs was provided with data on Helm's inventory. There was no threatening inventory of the product being investigated at the time of the Customs investigation and the Customs did not allege that there was. Inventory is a non-issue.

165. Thus, on the basis of fact, and not conjecture or remote possibility, and having regard to the leading examples of grounds for apprehension of injury (WTO Agreement, Article 3.7), there is absolutely no evident change in circumstances which would make injury from imports from the USA foreseeable and imminent (Customs Act, s.269TAE(2B)).

166. The Minister is obliged to consider the application of anti-dumping measures based on threat with special care (WTO Agreement, Article 3.8). By virtue of s.269ZZ, the review officer has the same obligation.

Helm submits that the requisite special care has not been exercised in this case. Had that special care been exercised, a decision to publish a notice under s.269TG(2) would not have been made.

Review Officer's Assessment

167. The Review Officer having considered the information in relation to dumped imports of FSP from the USA, affirms Customs' finding that these imports have caused material injury and are likely to cause material injury to the Australian industry

168. The Review Officer also affirms Customs' recommendation that the Minister be satisfied that section 269TG(2) of the Act applies to FSP exported from the USA.

Helm's claims are:

The Public Interest - Perverse Anti-Dumping Administration

169. The examples set out in Article 3.7 of the WTO Anti-Dumping Agreement of factors to be considered in making a determination of threat of material injury are simply that: examples. They are expressly to be considered inter alia.

170. Among the other things which might be considered by the Minister is one which must be considered every time a ministerial decision is made: the public interest.

171. Helm submits that to it is contrary to the public interest and perverse anti-dumping administration to take the savage and unjustified action which has been taken against Helm when that importer (and its predecessors) has demonstrably pursued a non-injurious policy towards the local industry, not only within the investigation period, but for a decade or so before that. The two previous findings in investigations and the finding of the Anti-Dumping Authority (ACDN 86/319: ACS Report 93/7; ADA Report No. 105 - see the ACS Report [No. 43], section 3.6, pp.7-8) bear this out.

172. In Helm's submission, the citation by Customs of data gathered during the 1986 and 1993 investigation and of related reports brings all this evidence within the definition, given in s269ZZK, of 'relevant information'.

173. The history of Helm's self-restraint of market share is plain to see. Abundant evidence has been given that Helm (following the policy of its predecessors) has seen itself as a non-injurious dual source (see "Dual Sourcing", Helm Response to the SEF, pp. 11-13) and has acted accordingly. Helm's sales of imports from the USA were injured by the intrusion of low-priced imports from other sources to an even greater extent than were DCAL's sales of local product.

174. It is submitted that to penalise responsible firms trading fairly into a host market is no way to encourage fair trading and is contrary to the public interest; it is perverse anti-dumping administration.

175. Another example of perverse administration is the unjustified refusal by Customs to inform Helm of the occasions on which it allegedly undercut DCAL's prices. Had some circumstance caused this to happen without Helm's knowledge and had Helm been aware of when the instance(s) occurred then, even if no injury had been caused, Helm could still have taken remedial action.

176. Helm has been denied this opportunity.

177. In an administrative regime aimed at protecting Australian industry, to bring about such an outcome would not only be mindless, it would be perverse.

The Review Officer's Assessment

178. The Review Officer can only consider relevant information when conducting a review the above issues are, in the opinion of the Review Officer not considered relevant information and have not been considered in conducting this review.

Helm's claims are:

Non-Injurious Prices

179. The determination of the "unsuppressed selling price" (USSP) of locally produced FSP and the resulting determination of a non-injurious [export] price (NIP) of the import has, in the case of the USA, resulted in a NIP which is excessive and, in Helm's submission, unlawful.

180. Well prior to the Minister making his decision, Helm provided him with a spreadsheet showing the excessive profit levels for DCAL implicit in the NIP from the USA under various assumptions of which available data would show which is correct. That spreadsheet is relevant evidence.

181. The Review officer's attention is also invited to the fact that there is only one USSP in the Australian market. There can be as many NIP's as there are exporting origins but there must be no greater differences between these NIP's than are attributable to differences in "relevant costs which would be incurred by the importer" (ACS Report, section 8.4, pp. 38-39). The Review officer is requested to review the NIP's from the different countries, especially Singapore (Mitsubishi) and the USA, to ensure that they are consistent.

The Review Officer's Assessment

182. The calculation of a NIP is based on the non-injurious price being defined as the minimum price necessary to remove any injury caused by dumping. Given that, the NIP has been calculated in accordance with Customs' guidelines, the Review Officer affirms Customs' calculations.

Review Officer's Recommendations and Conclusions

183. In conducting this review, the Review Officer has taken account of all the evidence available to Customs during the course of its inquiry as well as the arguments contained in applications and submissions presented to the Review Officer.

184. The reviewable decision by the Minister in this particular case is:

a decision by the Minister that section 8 of the Customs Tariff (Anti-Dumping) Act 1975 applies to FSP and like goods exported to Australia from Singapore and the USA.

185. The foregoing analysis shows that, in the opinion of the Review Officer, Customs' findings in respect of dumped imports of FSP from Singapore and the USA have caused material injury to the Australian industry and threaten to cause material injury to the Australian industry producing like goods.

186. Accordingly, the Review Officer recommends that the Minister's original decision in this matter be affirmed.

Richard Oliver
Trade Measures Review Officer