Review of termination decision - Clear Laminated Safety Glass (CLSG) from certain producers in China and Indonesia

4 January 2007

  1. On 10 November 2006 an application was made under subdivision C of Division 9 of Part XVB of the Customs Act 1901 (the Act) by Pilkington (Australia) Ltd (Pilkington) seeking a review of the decision dated 18 October 2006 of the delegate of the Chief Executive Officer (CEO) of the Australian Customs Service (Customs) to terminate an anti dumping investigation in relation to certain Chinese and Indonesian exporters of clear laminated safety glass (CLSG).
  2. Pilkington had made an application to the Minister for Justice and Customs (the Minister) requesting that a dumping duty notice be published in respect of certain CLSG from China and Indonesia. Customs commenced an investigation but on 18 October 2006 terminated it so far as it related to Shanghai Yaohua Pilkington Glass Co Ltd (SYP) and Xinyi Glass Engineering (Dongguan) Co Ltd (XGE) of China and PT Surya Adhita Fortuna Glass (Fortuna) of Indonesia. Customs found that there had been no dumping of CLSG by these firms.
  3. By application dated 10 November 2006, Pilkington sought a review of the decision to terminate the investigation, referred to in section 269ZZP of the Act as a "termination decision". I am required to reject an application for review if the application contains material of a confidential nature and the applicant fails to give a non confidential summary of that material. No such issue arises here.
  4. The essence of the application for review is that Customs should have determined normal value of the laminated safety glass under subsection 269TAC(1) of the Act, that is:

    "the price paid or payable for like goods sold in the ordinary course of trade for home consumption in the country of export in sales that are arms length transactions by the exporter, or, if like goods are not so sold by the exporter, by other sellers of like goods".
  5. In relation to Fortuna, the normal value report prepared by Customs states that:

    "not only are total sales in the domestic market of low volume, the markets are different. CLSG is sold to Australia in standard sheet size, whereas sale on the domestic market are of glass cut to size as specified by individual customers. Further, like goods are sold in small quantities, sometimes only less than one square metre, whereas sales to Australia are high volume (container loads). Finally, the nature of the customers is different in that the Australian customer is generally a wholesaler who on-sells glass whereas the domestic customer is mostly an end user."

    On this basis, Customs determined that the market in Indonesia was not suitable for determining normal value based on the price paid or payable in the domestic market for CLSG. [1]
  6. Customs found that the market conditions that prevailed in China were the same as those in Indonesia. SYP was found to be a significant producer, manufacturer and seller of CLSG, clear float glass (CFG) and other processed glass.[2] During the investigation period SYP had sold a significant quantity of laminated glass, and CLSG amounted to 53% of the amount sold, and almost all of it was exported.[3] Australia was the major destination for exports of CLSG accounting for 54% of sales, with exports to other countries being 45% and domestic sales amounting to 1%. CLSG in 6.38mm and 10.38mm thicknesses accounted for 91% of CLSG destined for export. The normal value report notes:

    "CLSG is sold by SYP to end users in the domestic market whereas sales to Australia are to wholesalers who process the glass and on-sell to end users. Further, much of the glass sold domestically is processed (cut to size) whereas sales to Australia are of large standard sheet sizes. In addition, individual sales volumes are quire different - for sales to Australia, 95% of purchases were for more than 100 square metres whereas for the domestic market, almost 85% of orders were for less than 100 square meters and a considerable number were for quantities of less than one square metre."[4]
  7. Accordingly, Customs considered that because of the low volume of domestic sales and the unsuitable market situation that normal value could not be determined under subsection 269TAC(1). Customs found that there was sufficient reliable information to enable normal value to be constructed in accordance with subsection 269TAC(2). Similar findings were made by Customs in relation to XGE.
  8. I consider there is sufficient evidence to justify Customs' decision to determine normal value pursuant to subsection 269TAC(2). In relation to each exporter examined there was either or both a low volume of domestic sales of CLSG, or the differences in the export market and the domestic market were such that sales in the latter were not a suitable basis for determining the normal value of the goods exported to Australia. Customs in my view has not erred in its approach to these exporters.
  9. Pilkington, in its application also stated that Customs erred in regarding toughened glass and laminated safety glass as like goods for determining normal value. However Customs did not find CLSG and toughened glass to be like goods. [5] Financial data in relation to sales of safety glass generally were taken into account in constructing a profit component in determining normal value, but this was not an error, in my view. Paragraph 269TAC(2)(c) states the basis for determining a constructed normal value. It is the sum of the amount considered by the Minister to be the cost of production or manufacture of the goods in the country of export and such amounts as the Minister determines would be the administrative, selling and general costs associated with the sale and the profit on that sale. In both China and Indonesia, there were only very low volumes, if any at all of CLSG sold on the domestic market, because, according to the available evidence the domestic markets in those countries favoured toughened glass over CLSG.
  10. Regulation 181A of the Customs Regulations 1926 (the Regulations) sets out the manner in which the amount of profit on the sale of goods must be worked out. Subregulation 181A(2) provides that the Minister must, if reasonably possible, work out the amount by using data relating to the production and sale of like goods by the exporter or producer of the goods in the ordinary corse of trade. Subregulation 181A(3) specifies alternative methods for calculating profit where it is not possible to do so under subregulation 181A(2), and among the methods that are included are identifying actual amounts realised by the exporter or producer from the sale of goods of the same general category in the domestic market. In addition, any other reasonable method can be used having regard to all relevant information, including the amount of profit realised by other producers on sales of goods of the same general category in the domestic market of the country of export.
  11. Although CLSG and tempered or toughened glass are not like goods, in the sense of being identical in all respects, they are both types of safety glass and can reasonably be regarded as being goods of the same general category, for the purposes of constructing profit margins in accordance with the Regulations.
  12. The decision of the CEO to terminate the dumping investigation in relation to SYP, XGE and Fortuna is affirmed.

Mark A Zanker
Trade Measures Review Officer

Telephone: 62506647
Facsimile: 62505931


[1] folio 88 of file C06/16407.

[2] folio 31 of file C06/17128.

[3] 99% of the CLSG that was sold was exported.

[4] folio 16 of file C06/17128.

[5] Customs' finding was that there was a degree of substitutability between the two types of glass; Statement of Essential Facts No 114, p 8.


Review of termination decision - Clear Laminated Safety Glass (CLSG) from certain producers in China and Indonesia