Asia Symbol (Guangdong) Paper Co Ltd v Anti-Dumping Review Panel
[2019] FCA 792
•30 May 2019
FEDERAL COURT OF AUSTRALIA
Asia Symbol (Guangdong) Paper Co Ltd v Anti-Dumping Review Panel
[2019] FCA 792
File number: NSD 732 of 2018 Judge: ROBERTSON J Date of judgment: 30 May 2019 Catchwords: ADMINISTRATIVE LAW – judicial review – Part XVB of the Customs Act 1901 (Cth) – anti-dumping measures – whether no evidence or other material to justify the recommendation made by the first respondent in ADRP Report 55, and consequently the decision of the second respondent, with respect to the re-calculation of the applicant’s normal value – whether, if no evidence or other material, an improper exercise of the power or an error of law Legislation: Administrative Decisions (Judicial Review) Act 1977 (Cth) s 5
Customs Act 1901 (Cth) ss 269TAC, 269TG, 269ZZK, 269ZZL, 269ZZM
Customs Tariff (Anti-Dumping) Act 1975 (Cth) s 8
Evidence Act 1995 (Cth) s 136
Cases cited: Australian Broadcasting Tribunal v Bond [1990] HCA 33; 170 CLR 321
Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32; 241 CLR 390
Minister for Immigration, Local Government and Ethnic Affairs v Pashmforoosh (1989) 18 ALD 77
Minister for Immigration and Multicultural Affairs v Rajamanikkam [2002] HCA 32; 210 CLR 222
Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; 206 CLR 323
Sinclair v Maryborough Mining Warden (1975) 132 CLR 473
Tisdall v Webber [2011] FCAFC 76; 193 FCR 269
Wattie v Industrial Relations Secretary on behalf of the Secretary of the Department of Justice (No 2) [2018] NSWCA 124
Date of hearing: 17 December 2018 and 1 May 2019 Registry: New South Wales Division: General Division National Practice Area: Administrative and Constitutional Law and Human Rights Category: Catchwords Number of paragraphs: 163 Counsel for the Applicant: Ms H Younan Solicitor for the Applicant: Moulis Legal Counsel for the Respondents: Mr GR Kennett SC with Mr BD Kaplan Solicitor for the Respondents: Maddocks Lawyers ORDERS
NSD 732 of 2018 BETWEEN: ASIA SYMBOL (GUANGDONG) PAPER CO., LTD
Applicant
AND: ANTI-DUMPING REVIEW PANEL
First Respondent
PARLIAMENTARY SECRETARY TO THE MINISTER FOR JOBS AND INNOVATION
Second Respondent
JUDGE:
ROBERTSON J
DATE OF ORDER:
30 MAY 2019
THE COURT ORDERS THAT:
1.The application is dismissed.
2.The applicant is to pay the respondents’ costs, as agreed or assessed.
3.The parties are to notify Robertson J’s associate within 14 days if they contend that the reasons for judgment contain any information the subject of non-publication orders.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
ROBERTSON J:
Introduction
The applicant produces A4 copy paper, which it exports to Australia.
By its amended application filed on 21 June 2018, the applicant applies to the Court for judicial review of the decision of the Parliamentary Secretary to the Minister for Jobs and Innovation, made under s 269ZZM(1) of the Customs Act 1901 (Cth), consequent upon and based on the recommendations of the Anti-Dumping Review Panel (ADRP) in its ADRP Report 55 – A4 Copy Paper exported from the Federative Republic of Brazil, the People’s Republic of China, the Republic of Indonesia, and the Kingdom of Thailand (ADRP Report 55), as conveyed in the notice published on 9 March 2018 under s 269ZZM(4) of the Customs Act (decision).
By the decision, as it relates to the applicant, the Parliamentary Secretary revoked a decision of the former Parliamentary Secretary made on 18 April 2017 (previous decision) to impose dumping duties on the export of A4 copy paper from the People’s Republic of China (PRC) by the applicant, such previous decision having been made on the basis of the Anti-Dumping Commission (ADC) Final Report containing the findings and recommendations of the ADC for investigation 341 (Final Report 341), dated 17 March 2017.
The Parliamentary Secretary substituted the previous decision with the decision, being in the same terms except for, relevantly, a different normal value and resulting dumping margin with respect to the applicant.
The effect of the decision was to require importers of A4 copy paper exported by the applicant to Australia to pay an interim dumping duty under s 8(3) of the Customs Tariff (Anti-Dumping) Act 1975 (Cth) to the Comptroller-General of Customs.
The application for judicial review
The applicant seeks orders setting aside or quashing the recommendation in ADRP Report 55 that the Parliamentary Secretary substitute a new decision with a normal value resulting in a dumping margin of 3.0%; setting aside or quashing the decision; remitting the matter for determination according to law; and costs.
The grounds of the application are, omitting particulars:
1.There was no evidence or other material to justify the recommendation made by the First Respondent in ADRP Report 55, and consequently the Decision of the First Respondent, with respect to the re-calculation of the Applicant’s normal value, within the meaning of s 5(1)(h) and s 5(3)(b) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (ADJR Act). Specifically, the re-calculation adopted a purported quantity discount that in fact comprised both quantity and brand-related criteria.
2.In the absence of an evidentiary foundation for the recalculation of normal value, resulting in a dumping margin of 3.0%, the recommendation in the ADRP Report 55 and the Decision were an improper exercise of the power conferred by the enactment in pursuance of which they were purported to be made, within the meaning of s 5(1)(e) of the ADJR Act.
3.In the absence of an evidentiary foundation for the recalculation of normal value, resulting in a dumping margin of 3.0%, the recommendation in ADRP Report 55 and the Decision involved an error of law within the meaning of s 5(1)(f) of the ADJR Act.
The applicant submitted that these grounds were potentially independent but accepted that if it did not succeed on its point that there was an absence of evidence to justify the decision then it would fail on all grounds. In this respect, the applicant contended that there must be a rational or a logical connection between the evidence that was said to support the asserted fact and the asserted fact.
The statutory provisions
The submissions focussed on the following provisions of the Customs Act:
269TAC Normal value of goods
(1)Subject to this section, for the purposes of this Part, the normal value of any goods exported to Australia 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.
…
(8)Where the normal value of goods exported to Australia is the price paid or payable for like goods and that price and the export price of the goods exported:
(a) relate to sales occurring at different times; or
(b) are not in respect of identical goods; or
(c)are modified in different ways by taxes or the terms or circumstances of the sales to which they relate;
that price paid or payable for like goods is to be taken to be such a price adjusted in accordance with directions by the Minister so that those differences would not affect its comparison with that export price.
The evidence
The applicant sought to read an affidavit of Mr Daniel Moulis, lawyer, sworn 27 July 2018. When the matter was first listed for hearing on 17 December 2018, there was an evidentiary difficulty in that the applicant sought to read the material in this affidavit, which material was before the decision-maker, to establish that a certain fact or certain facts did not exist. An adjournment was sought and granted to allow the applicant to adduce further evidence.
On the resumed hearing, senior counsel for the respondents applied, under s 136 of the Evidence Act 1995 (Cth) for a limitation on the use to be made of Annexures DM10, DM15, DM18, DM20, DM23 to the affidavit of Mr Moulis sworn 27 July 2018 on the ground that there was a danger that a particular use of that evidence might be misleading or confusing. The particular use was that the applicant originally sought to use this material, which was before the decision-maker, to prove not only the absence of material before the decision-maker establishing a fact but also that a fact did not exist. Under s 136, I limited the use of this material so that it was not to be relied on as evidence of the non-existence of a fact for the purpose of the judicial review application. Counsel for the applicant did not oppose this limitation in light of the more recent evidence of Mr Wang Yu Liang: see at [11] below. Otherwise, that affidavit was taken as read, subject to the corrections that were made to it by the affidavit of Mr Moulis sworn 14 December 2018, to which there was no objection.
The applicant also read, without objection, the affidavit of Mr Wang Yu Liang affirmed 21 February 2019. That affidavit was not before the decision-maker but was directed to proving that a particular fact or facts on which the decision-maker based the decision did not exist: see s 5(3)(b) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (ADJR Act).
The respondents read, without objection, the affidavit of Mr Ian Temby, lawyer, affirmed 13 September 2018, with the exception of paragraph 8, which was not read, and ILT 6 which was not tendered.
There was no cross-examination on any of the affidavits.
Chronology
On 24 February 2016, Paper Australia Pty Ltd (Paper Australia) made an application to the Commissioner of the ADC, under s 269TB of the Customs Act, to request that the Minister publish a dumping duty notice in respect of A4 paper exported to Australia from, relevantly, the PRC.
Following the receipt of that application, the Commissioner gave a questionnaire to the applicant and Greenpoint Global Trading (Macao Commercial Offshore) Ltd (Greenpoint). They were together treated as a single exporter (Asia Symbol) for all Australian sales during the investigation period for the purposes of Paper Australia’s application. Greenpoint was the commercial entity that exported A4 copy paper to Australia.
On 26 May 2016, the exporter questionnaire was jointly completed by the applicant and Greenpoint and provided to the ADC.
In November 2016, the ADC published Investigation 341 Visit Report (Initial Verification Report) in relation to the applicant, following an on-site visit to the applicant and Greenpoint.
On 7 December 2016, the applicant’s legal representatives emailed the ADC regarding a number of issues with the Initial Verification Report and dumping margin calculations.
On 9 December 2016, the ADC published its Statement of Essential Facts in relation to Investigation 341 (Statement of Essential Facts). The ADC noted that the applicant had not yet agreed to the Initial Verification Report being placed on the public record, and that the dumping margin it had calculated for the applicant was 3.7%.
On 12 December 2016, the ADC requested the applicant provide separate confidential and non-confidential submissions regarding the amendments to “Discounts and rebates (quantity based on domestic sales)” adjustment to normal values, for consideration in the final recommendation. The relevant part of the email stated:
“Discounts and rebates (quantity based on domestic sales)” adjustment to the normal value
Based on the verbal submissions during the verification visit, no changes have been made at this point in time to the calculation for the treatment of the discounts and rebates amounts. The submission on this point constitutes new information that was not forthcoming at the verification visit, whereby it was submitted to the verification team that the amounts were all ‘quantity based’. I would appreciate if you could please provide this submission in a separate confidential and non-confidential version that will be addressed by the case management team for the final recommendation.
The applicant’s legal representatives had previously by email on 7 December 2019 made the following submission in relation to that topic, relevantly:
[XXXXX X]
(Original emphasis.)
On 15 December 2016, the ADC provided a copy of the amended dumping margin calculation spreadsheet by email to the applicant’s legal representatives, which showed the dumping margin for the applicant as 3.1%. On 16 December 2016, the verification report was published by the ADC on the public record (Published Verification Report). The applicant’s dumping margin on the Published Verification Report’s recommendations was 3.1%.
On 29 December 2016, the applicant provided a detailed submission to the ADC responding to the Published Verification Report and Statement of Essential Facts. That submission said, in part:
13.In light of the above, and as an alternative to Asia Symbol’s primary view that the entirety of the sales discounts should be deducted in working out the price paid and not be used as an upwards adjustment (as to which, see paras 5 and 6 above), we submit that the part of the upward adjustment that is not volume based must be reversed. This is because it must be accepted that the first [A]% of the sales discounts on domestic sales of the like goods (being [XXXXX X]) is not volume-related and was paid on the same product as was exported to Australia. This part of the sales discounts is not related to the reasoning offered by the report for the upwards adjustment, because it has nothing to do with the quantity purchased by the customer.
…
15.In summary, it is true that sales discounts were provided by Asia Symbol under sales agreements applicable to the investigation period which stipulated a target volume for each kind of goods the customer contracted to buy from Asia Symbol during the agreed period (usually within the calendar year). However the [XXXXX X] were not dependent on the volume purchased.
(Original emphasis.)
On 18 or 19 April 2017, Final Report 341 was published.
On 19 April 2017, the previous decision of the Parliamentary Secretary to accept the findings and recommendations of the ADC in Final Report 341 was published by Anti-Dumping Notice 2017/39, dated 18 April 2017. The applicant’s dumping margin as recorded in the previous decision was 3.1%.
On 19 May 2017, the applicant applied to the ARDP for review of the previous decision under ss 269ZZA and 269ZZC of the Customs Act. The application restated “the clear advice provided in the SEF submission”, set out the relevant parts of that submission and continued:
The rebate policy states clearly that volume is only a consideration for “additional rebate” to become available. Where the annual volume is between [certain amounts], and the monthly volume is between [certain other amounts], there would simply be no additional “Commit volume incentive”…
Accordingly, missing out on achieving this volume based “additional rebate” does not affect the eligibility of the customer for the [XXXXX X] at Part 1 of the criteria in the rebate policy. This is the key message explained in paragraph 9 of our SEF submission as cited above. This point is further demonstrated through the example contracts referred to in paragraphs 11(b), (c) and (d), which show that the basic rebate was provided for low volume contracts. The Australian customer, who purchased [B] MT in the period of investigation, would have received that basic rebate had it been located in China.
(Original emphasis.)
On 7 August 2017, the applicant made a detailed submission to the ADRP in support of its application. That submission stated in part:
We carefully explained to the Commission that if a domestic customer of Asia Symbol purchased the same grade and quantity as purchased by the Australian customer during the POI, such a customer would have been given the basic incentive of [A]%, but without further volume based incentives. Indeed, we went oven [sic] further than this, and provide [sic] examples of contracts with customers that were in the same position, in terms of the kind of product purchased and the volume of its purchases, as the Australian customer.
(Footnotes, referring to certain pages of the ADRP application, omitted.)
Also on 7 August 2017, the ADC made a submission to the ADRP in relation to the ADRP application. It said, relevantly:
The Commission considered the sales discounts provided by Asia Symbol on the Chinese domestic market in REP 341 at 6.8.4.2. The Commission notes that the domestic sales contracts upon which Greenpoint is relying on [sic] as evidence for its claim were only provided to the Commission as attachments to its submission on the statement of essential facts (SEF) - i.e. they were not provided at verification. The Commission further notes that the arguments made in relation to these contracts as evidence for Greenpoint’s claim are far more detailed in its application to the ADRP than they were in its post-SEF submission. Nevertheless the Commission makes the following comments on the claim as articulated in Greenpoint’s application to the ADRP:
•Greenpoint’s response to the exporter questionnaire (REQ) shows the goods exported to Australia have product code “[XXXXX X]” and appear to be “[XXXXX X]” brand (Confidential Attachment J). From the two sample contracts provided by Greenpoint it is not clear what brands qualify for the discounts at item 6.1 of the contracts, and Greenpoint has not identified references to “[XXXXX X]” and “[XXXXX X]” in the domestic sales spreadsheet or its REQ.
•Product code [XXXXX X] includes brands other than “[XXXXX X]” and “[XXXXX X]” and there is no evidence that the rebate would apply to those other brands, which account for [C]% of product code [XXXXX X] by volume (refer to analysis at Confidential Attachment K).
(Original bold type. Footnote omitted.)
A meeting was also held on 7 August 2017 between the ADRP and the ADC regarding the issues raised by the applicant in its ADRP application and submissions, a summary of which was published on 28 August 2017.
On 29 August 2017, the applicant made a second detailed submission to the ADRP in response to the August Conference Summary. This submission said, in part, that the fact that a rebate scheme was applied to the “other brands” that account for a particular percentage of a particular product code by volume could be supported by the information that had already been provided to the Commission during the investigation. In particular, if the Commission had proper regard to the relevant rebate table, in checking whether any particular brands were covered by the rebate scheme, it would also have found the footnote under that table which further demonstrated the independent nature of the particular rebate, which was not dependent on volume.
On 4 September 2017, the ADRP made a request under s 269ZZL of the Customs Act for the ADC to reinvestigate certain findings in Final Report 341, including findings relating to the applicant’s discount and rebate policy application.
On 11 December 2017, the ADC published its Report to the Anti-Dumping Review Panel – Reinvestigation of certain findings in Report 341 – A4 copy paper exported from the Federative Republic of Brazil, the People’s Republic of China, the Republic of Indonesia and the Kingdom of Thailand in response to the request for reinvestigation (Reinvestigation Report).
In the Reinvestigation Report the ADC affirmed its finding that Asia Symbol’s normal value should reflect the finding that Asia Symbol’s very small quantity of exports to Australia would not attract the quantity rebates and discounts given to Asia Symbol’s domestic customers. Accordingly, the ADC said that in calculating normal value, Asia Symbol’s net domestic price should be adjusted upwards to account for quantity rebates and discounts given to its domestic customers. The ADC said that it based its findings on unequivocal statements by Asia Symbol that rebates and discounts given to its domestic customers were based on quantity:
·in Asia Symbol’s response to its exporter questionnaire; and
·during on-site verification at Asia Symbol by the ADC.
The ADC said it had also assessed material provided by Asia Symbol in its submission dated 29 December 2016.
The ADC referred to the substance of its findings, namely that discounts and rebates were quantity based, and the very small amount of Asia Symbol’s export sales to Australia would not attract the quantity based discounts and rebates given to Asia Symbol’s domestic customers.
The ADC said the following evidence showed that the quantity sold had an effect on price comparability:
•In its exporter questionnaire response Greenpoint/Asia Symbol stated that “it entered into agreements with some of [its] distributors by which the parties agree that the distributor customer will be given a discount or rebate for reaching certain purchase targets” (see Greenpoint/Asia Symbol Response to Exporter Questionnaire at page 21).
•Greenpoint/Asia Symbol stated during the exporter verification that discounts and rebates were “all quantity based for all goods sold domestically” (see Greenpoint/Asia Symbol Visit Report at page 12).
The ADC said that Asia Symbol made a submission dated 29 December 2016 following the Statement of Essential Facts in which it claimed that some discounts and rebates were not based on quantity. The ADC noted that Asia Symbol provided documents with that submission that it claimed demonstrated that discounts and rebates were given on a basis other than for quantity sold. These documents, the ADC said, did not demonstrate that discounts and rebates were given on a basis other than for quantity sold. In particular, the ADC said:
•The domestic customer contracts provided with the submission were in Chinese with only a few English annotations. The English annotations did not show or demonstrate that discounts and rebates were given on a basis other than for quantity sold.
•Another document is described by Greenpoint/Asia Symbol as its “sales discount policy”. There are a number of issues with this document:
o The document does not contain the word “Discount” (nor does it contain the word “Policy”). The document, on its face, is concerned only with rebates. This is relevant given that Greenpoint/Asia Symbol’s systems treat discounts and rebates separately. If the document is evidence of anything it is not evidence of the basis on which discounts are given; this is significant given that aggregate discounts given by Asia Symbol are almost [D] times aggregate rebates given by Asia Symbol.
o Greenpoint/Asia Symbol made no attempt to show how the policy related to the domestic customer contracts provided with Greenpoint/Asia Symbol’s submission (or any other contract between Asia Symbol and its domestic customers). The customer contracts provided are in Chinese and the policy is in English; accordingly it seems clear that the policy was not an annexure or attachment to the customer contracts.
(Footnote omitted. Part redacted omitted.)
On 18 December 2017, a meeting was held between the ADRP and the ADC regarding the findings in the Reinvestigation Report in relation to Asia Symbol. The ADRP’s written summary of that meeting contained the following:
2.Could the ADC elaborate on its comments regarding certain discounts/rebates specifically brand discount [confidential domestic sales information] not being available if the export sales had been made in China?
The ADC referred to the confidential domestic sales spreadsheet which outlined the discounts and rebates summaries derived from Asia Symbol’s financial records [confidential domestic sales information]. It commented that these descriptions did not align with the descriptions in the confidential Discount Policy document provided to the Review Panel. It also questioned the language of discounts as compared with rebates. In addition, and as referred to in the confidential section of the reinvestigation report the ADC was unable to reconcile the amounts verified at the visit with the amounts that should be available if the provided discount policy was implemented [confidential analysis of financial records]. The ADC considered this raised areas of inconsistency.
The ADC indicated that it had included all the domestic transactions considered ‘like’ the exported goods, noting that brand names [confidential domestic sales information] were, in some cases, different but this did not mean they were not the like goods.
In the light of the information discussed above, I requested the ADC to recalculate the normal value (and dumping margins) based on net domestic selling price with an upward adjustment utilising the quantity based discounts, but not the brand based [confidential domestic sales information] discounts.
On 3 January 2018, a spreadsheet containing the dumping margin recalculations was provided by the ADC to the ADRP which reduced the applicant’s dumping margin from 3.1% to 3.0%.
Also in January 2018, the ADRP prepared ADRP Report 55, which contained its findings and recommendations to the Parliamentary Secretary in respect of the review.
On 9 March 2018, the Parliamentary Secretary made the decision, which as I have said at [2]-[3] above accepted the findings and recommendations of the ADRP in ADRP Report 55. The applicant’s dumping margin as a result of the decision was 3.0%.
On 13 March 2018, the applicant’s lawyers were provided with a copy of the spreadsheet referred to at [38] above.
ADRP Report 55
In the ADRP’s summary, and as far as presently relevant, it said ADRP Report 55 was prepared in response to an application for review of the decision by the Parliamentary Secretary to publish a dumping duty notice in relation to exports of A4 Copy Paper from the PRC.
The ADRP recorded that the ADC undertook an investigation for the period 1 January 2015 to 31 December 2015 and the then Parliamentary Secretary published the previous decision in relation to the ADC’s report on 19 April 2017.
The two grounds of review relied on by Asia Symbol were:
•The Parliamentary Secretary erred as the actual price paid should have been used as the basis of the normal value determination; and
•Discounts and rebates, as a claimed adjustment to the normal value, have not been determined correctly.
As I have said, on 4 September 2017, the ADRP required a reinvestigation be undertaken by the ADC pursuant to s 269ZZL in relation to specific findings that formed the basis of the reviewable decision. The Reinvestigation Report was provided to the ADRP on 11 December 2017.
The ADRP considered the grounds and found that the previous decision was not the correct or preferable decision. Accordingly, the ADRP recommended that the Parliamentary Secretary revoke the previous decision and substitute a new decision.
The ADRP said that in carrying out its function it is not to have regard to any information other than to “relevant information” as that expression is defined in s 269ZZK(6). For the purpose of the review, the relevant information is that to which the ADC had, or was required to have, regard when making the findings set out in the report to the Ministers: s 269ZZK(6)(a). In addition to relevant information, by s 269ZZK(4), the ADRP may have regard to conclusions based on relevant information that is contained in the application for review and any submissions received under s 269ZZJ.
The ADRP set out the relevant issues under the heading “Has the normal value been correctly determined?” and subheading “Claims”, as follows, at [359]-[360]:
[Asia Symbol] claims that the normal value should have been based on the net price paid for like goods in the domestic market - that is, a price net of the discounts and rebates. It claims that the ADC has inflated the normal value by either not using the net price, or by adding ‘discounts and rebates’ to the net price that were previously deducted. It also claims that there is no reference in the table summarising adjustments to the normal value (Table 7 in REP 341) indicating that an upward adjustment has been made to the net domestic selling price. It claims this is not an appropriate adjustment under s.269TAC(8) of the Act. This is dealt with as a separate ground in its application. However, I have dealt with the two grounds together.
[Asia Symbol] claims that, subsequent to the SEF, it provided additional information on the ‘2015 Asia Symbol Official Sales Discount Policy’ (Discount Policy). It states that the ADC did not accept these discounts on the basis that the volumes to the Australian buyer were lower. It claims that the ADC has either misunderstood its discount policy or its correct application in the Chinese domestic market. [Asia Symbol] also states that there appears to be some confusion on the part of the ADC in relation to Asia Symbol’s financial records and treatment of [XXXXX X] …
(Footnote omitted.)
Under the heading “Submissions and Conference material”, the ADRP said, at [362]-[364]:
[Asia Symbol] made a further submission to the Review Panel on Asia Symbol Domestic Sales Rebate Policy. It provided an explanation of its calculations of the ‘discounts and rebates’ for normal value purposes.
In relation to the issue of the normal value determination, I found the explanation in REP 341 a little unclear as to whether the net selling price had been used and what adjustments had been made. For this reason, I sought additional information from the ADC, via a conference.
I reviewed the confidential normal value spreadsheet, which confirmed that the Asia Symbol net domestic selling price had been subject to an upwards adjustment for discounts and rebates. The Commission used the net domestic selling prices (that is, net of discounts and rebates) to establish whether the domestic sales by Asia Symbol were in the ordinary course of trade. This process was described in the verification report and established that the sales were suitable for the normal value assessment. The domestic selling price was subsequently modified with adjustments under s.269TAC(8) to establish the normal value, including an upward adjustment for discounts and rebates.
(Footnotes omitted.)
At [369], the ADRP said:
While the ADC is not questioning the arms-length nature of the transactions, the manner in which it discusses what selling price should be used as the base to determine normal value is unclear. Its comments in relation to Asia Symbol’s accounting records on price and discounts/rebates are also a little confusing. The ADC states that:
‘… based on evidence provided by Asia Symbol, including invoices and bank statements, it is clear that the price paid or payable on domestic sales of like goods did not include any amount of the sales discount submitted by Asia Symbol. No evidence was provided to substantiate that the stated discounts were paid. The Commission, did verify, however, that amounts for discounts were recorded in its accounting records.’
(Footnote omitted.)
At [374], the ADRP said, relevantly, that given the lack of clarity in relation to the calculation of the adjustments made under s 269TAC(8) by the ADC, the ADRP required the ADC to undertake a reinvestigation of the normal value, and that the ADRP asked the ADC to consider whether ‘discounts and rebates’ adjustments should be made to the domestic selling price.
ADRP Report 55 records, at [375], that the ADC provided its Reinvestigation Report and affirmed its finding. It “clarified the normal value assessment process in greater detail” and confirmed it had used the net domestic selling price (net of discounts and rebates). It used this net price as the base to make adjustments under s 269TAC(8) including the upward adjustment for “discounts and rebates”. The ADRP said that it agreed with this approach.
The ADRP continued, at [376]-[392], as follows:
[The ADC] stated that in the context of the small quantity of exports to Australia as compared to the higher volume sales made to Chinese domestic customers, quantity discounts would not be appropriate. On this basis, an upward adjustment to the net selling price was required to reflect the ‘discounts and rebates’ not available to export sales.
The ADC explained that its upward adjustment for discounts and rebates was based on policy and practice related to quantity discounts described in the [Dumping and Subsidy] Manual. In this case, the ADC claims that the Australian importer would not have met the domestic market thresholds for a quantity discount, thus it is not an appropriate adjustment to enable comparability.
I agree with the ADC’s comments and approach regarding quantity discounts as outlined in the reinvestigation report. However, the ADC has assumed all the ‘discounts and rebates’ were quantity based and its approach proceeded on this basis.
Greenpoint claims there are multiple discounts/rebates available in the Chinese domestic market, not all of which are based on quantity. These are stated in the discount policy provided.
The ADC states in the reinvestigation report that: ‘these documents (the discount policy and supporting examples of invoices) do not demonstrate that discounts and rebates were given on a basis other than for quantity sold’. The ADC also raises a number of concerns regarding the evidentiary value of the information provided, given it wasn’t verified at the exporter visit.
I have examined the discount policy and the supporting evidence provided to the Review Panel relating to domestic sales. I also examined extracts of the financial accounts presented to the ADC. I note that various types of rebates described in the discount policy do not have the same descriptions (in terms of language) as stated in the financial records. I also note that in Greenpoint’s application to the Review Panel, additional explanation of the types of discounts/rebates was provided.
There are a number of factors that I consider relevant in relation to this matter. The verification visit was undertaken in early September; however, the visit report was not provided to Greenpoint until 1 December 2016. This, in my view, did not provide Greenpoint with an opportunity to address this issue prior to the publication of the SEF (9 December 2016).
Greenpoint provided a submission (dated 29 December 2016) which contained similar information as that presented to the Review Panel. This information, while considered in REP 341 (17 March 2017), appears to have been misunderstood and discounted on the basis that it was not provided at the verification visit. It appears that while verification was undertaken of the ‘discounts and rebates’ information to the Asia Symbol financial records at the visit, not all of the information was provided. My assumption is that Asia Symbol did not understand the significance of this information at its verification visit until it received the verification report. The ADC proceeded on the basis of its earlier interpretation that all of the discounts/rebates were quantity based.
However, in my view, and in the context of the additional explanation provided by Greenpoint, I agree that discounts/rebates, other than quantity discounts, would have been available from Asia Symbol in the Chinese domestic market, if the export sales had been made in that market.
On this basis, the element of ‘discounts and rebates’ related to [XXXXX X] should not have been subject to an upwards adjustment to the net domestic selling price. Therefore I disagree with this aspect of the finding of the ADC in the reinvestigation report.
I requested from the ADC, via a conference, additional information on the re-calculation of the normal value based on the net selling price with a modified discounts/rebates adjustment to exclude certain components. I required that the adjustment not include any discount/rebate amount that the export goods would have received if made on the domestic market. At the conference, the ADC explained that the ‘discounts and rebates’ [XXXXX X]. It was not simply a specific percentage decrease, as proposed by Greenpoint and specified in the discount policy. On this basis, I asked the ADC to calculate, on the best information available, the upwards adjustment to include all components other than [XXXXX X].
The ADC provided the Review Panel with the recalculated normal value as a result of this modified adjustment. This has resulted in the normal value being marginally lower than that determined in the original investigation. This modification consequently impacts on the dumping margin for Asia Symbol.
I find that there was an error in assessing the normal value for Asia Symbol relating to the adjustment amount for ‘discounts and rebates’.
Accordingly, I consider that the amount of the normal value as determined by the Minister is incorrect. I recommend that the normal value be amended to reflect the corrected adjustment for Asia Symbol under s.269TAC(8) of the Act. This leads to the dumping margin decreasing to 3.0 per cent (down from 3.1 per cent).
Have the discounts and rebates, as a claimed adjustment to the normal value been determined correctly?
This ground and the previous ground are linked, so I have not repeated the commentary regarding the domestic selling price and whether the discounts and rebates adjustment has been correctly calculated.
For this reason, I have determined that the claimed adjustment was not calculated correctly. This has led to the normal value being modified, which has also affected the dumping margin. A summary of this information is outlined in paragraphs 369 to 389 above.
Accordingly, I find that the Minister erred in relation to the amount of the adjustment under s.269TAC(8). This resulted in an error in the calculation of the normal value for Asia Symbol.
(Footnotes omitted.)
Finally, under the heading “Recommendations”, the ADRP said, at [586]-[587]:
I consider the reviewable decision in respect of Greenpoint/Asia Symbol was not the correct or preferable decision, in that the adjustment for discounts and rebates under s.269TAC(8) was incorrect. This resulted in an error in the calculation of the normal value. As a result, the dumping margin changed from 3.1 to 3.0 per cent. In a review of a decision under s.269TG, the Review Panel may only recommend that the reviewable decision be revoked and substituted with a new specified decision if the new decision is materially different to the reviewable decision. I have considered the volumes of exports involved and consider this change would lead to a significant amount of dumping duty over an assessment period. In such circumstances, I consider the change of dumping margin would make a material difference.
Accordingly, I recommend that the Parliamentary Secretary revoke the decision for Greenpoint/Asia Symbol and substitute a new decision with a different normal value that results in a new dumping margin of 3 per cent.
The parties’ submissions
The applicant submitted that the recommendation by the ADRP in Report No 55 that the dumping margin change from 3.1% to 3.0% was based on an upward adjustment in working out the normal value that purported to exclude brand based discounts, referring to [386] of that Report.
The applicant submitted that there was no evidentiary basis for the recommendation of a 3.0% margin as reflecting an adjustment excluding brand based discounts.
The applicant’s position was that, in the absence of this error, the recalculation would have reduced the applicant’s dumping margin from 3.1% to 1.6%. A dumping margin of less than 2% is considered de minimis, in which case the Commissioner must terminate the investigation so far as it relates to the exporter: s 269TDA(1) of the Customs Act.
As recorded at [7] above, there were three grounds of review, which the applicant expanded upon in its submissions as follows.
First, the applicant relied on s 5(1)(h) of the ADJR Act, coupled with s 5(3)(b) of the ADJR Act, to submit that the ADRP made its recommendation that the applicant’s dumping margin be reduced from 3.1% to 3.0% on the basis of an assumed fact (that the upward adjustment to the normal value excluded brand based discounts), which did not exist; in fact, the evidence indicated the contrary. Furthermore, the applicant submitted, there was no evidence or other material to justify that decision. The applicant referred to Curragh Queensland Mining Ltd v Daniel (1992) 34 FCR 212 at 220-221; Television Capricornia Pty Ltd v Australian Broadcasting Tribunal (1986) 13 FCR 511 at 519-520; Minister for Immigration and Multicultural Affairs v Rajamanikkam[2002] HCA 32; 210 CLR 222 at [32]-[33]; MLC Investments Ltd v Commissioner of Taxation [2003] FCA 1487; 137 FCR 288 at [92].
Second, the applicant relied on ss 5(2)(a) and (b) of the ADJR Act to submit that the making of the decision, in the absence of evidence or other material sufficient to justify it, was an improper exercise: (a) by the ADRP, of the power of review conferred by s 269ZZK(1) of the Customs Act; and (b) by the Parliamentary Secretary, of the power conferred by s 269ZZM(1) of the Customs Act, at least insofar as the respondents took into account in the exercise of that power an irrelevant consideration (that the upward adjustment to the normal value excluded brand based discounts) and failed to take account of a relevant consideration (that the upward adjustment incorporated brand based discounts), referring to Australian Broadcasting Tribunal v Bond [1990] HCA 33; 170 CLR 321 at 359.
Third, the applicant submitted, the making of findings and the drawing of inferences in the absence of evidence was an error of law within the meaning of s 5(1)(f) of the ADJR Act, referring to Bond at 355-356 and 367-368 and to Rawson Finances Pty Ltd v Commissioner of Taxation [2013] FCAFC 26; 296 ALR 307 at [84] per Jagot J.
The applicant submitted that the starting point was [386] of ADRP Report 55, set out at [53] above.
The applicant submitted, first, the rejection of a percentage decrease appeared to be a rejection of the application of the applicant’s sales discount policy, in the manner in which the applicant said it applied. If it was “not simply a matter of using the percentages outlined in the Discount Policy”, which was the only evidence of the discount/rebate scheme, then it was not apparent what evidence the ADC relied upon to adjust its figures.
Second and more importantly, the applicant submitted, the ADRP had proceeded on the basis that the modified discounts/rebates adjustment did not include brand based discounts (as the ADC was instructed to do). The applicant submitted that this was an assumption with no factual basis, and, in fact, the evidence demonstrated the contrary.
The applicant submitted the error was manifest in the recalculation of the dumping margin.
The applicant submitted the recalculations that appeared to be the basis for the recommendations in ADRP Report 55 were those contained in the spreadsheet provided to the applicant’s legal representatives as described at [41] above. That spreadsheet demonstrated the change in dumping margin from 3.1% to 3.0%. That change occurred in one of the formulae used to work out the total amount of discounts and rebates per metric tonne to be apportioned across the total domestic sales (ie, the upwards adjustment to be applied to the domestic sales price). Attachment 1 to the applicant’s written submissions contained a comparison of the formula used in the recalculation spreadsheet to the formula used in a spreadsheet earlier provided to the applicant (before the reinvestigation) in respect of both the “Discount Allocation” and “Rebate Allocation” tabs.
The applicant submitted that the evolution of the methodology of calculation demonstrated the reviewable error. The ADC commenced with a calculation of all discounts and rebates. Having been instructed to exclude brand related components, the ADC calculated the margin on the basis of two ledgers in the Discount Allocation tab (ie, “Sales Rebate – third party” (C6) and “Commission – third party (C9)) and the ledgers in the Rebate Allocation tab. This yielded inconsequential change to the dumping margin.
The applicant submitted the ADC then excised the “Commission – third party” ledger (C9), and relied solely on the “Sales Rebate – third party” (C6) to calculate the relevant discounts and rebates, noting that that “Sales Rebate – third party” (C6) is “based on qty, agreemt [sic]”. Two points may be drawn from this, the applicant submitted.
First, the “Commission – third party” ledger (C9) was assumed not to be a brand rebate in version 1, thus its inclusion in the formula. In version 2, the contrary was assumed, thus its exclusion. The applicant did not take issue with that assumption per se. However, it was significant to note that the reversal of the assumption was a correction that was applied to “Commission – third party” ledger (C9), but not to “Sales Rebate – third party” (C6).
Secondly, the applicant submitted, prior to reinvestigation, and on the basis that all discounts/rebates were based on (high) quantity of sales, the ADC included the “Sales Rebate – third party’ ledger (C6) as part of the formula to ascertain the dumping margin. This ledger was taken to be “based on qty, agreemt [sic]”. Notwithstanding acknowledgement by the ADRP of brand-related components, the ledger (C6) remained a part of the dumping margin formula. By its inclusion, the ADC had continued, not corrected, its assumption that this component comprised only quantity based discounts and rebates.
The applicant submitted there was no evidence to support that assumption. Moreover, the evidence considered by the ADRP indicated that the assumption was false.
The applicant submitted it was not sufficient to say that the formula supported the result. There had to be a logical or rational relationship, the applicant submitted, between the evidence and the decision that was said to be “justified” by it, referring to s 5(1)(h) of the ADJR Act and Minister for Immigration and Citizenship v SZMDS [2010] HCA 16; 240 CLR 611 at [135]. The applicant submitted the test was whether there was no foundation for the conclusion reached, referring to Tisdall v Webber [2011] FCAFC 76; 193 FCR 269 at [126]-[127]. The inferential process was not one where speculation, guesswork or mere assumption was accommodated: Tisdall at [128]-[131].
The applicant submitted the problem emanated from the ADC’s initial approach, which was to start with an adjusted normal value (ie, one that included all of the discounts and rebates as an upwards adjustment). Consequently, instead of instructing the ADC to identify which discount component was quantity based, and to apply the upward adjustment only to that component, the ADRP instructed the ADC to remove the brand based discount from the (already) adjusted normal value.
The applicant submitted the error lay in the ADRP accepting the revised dumping margin in circumstances where the ADC had not altered its assumption, and continued to treat a figure “based on qty, agreemt [sic]” as a figure that represented non-brand based discounts and rebates. On that basis, the applicant submitted that there was no evidence to support the recalculation of the dumping margin as “an upwards adjustment to include all components other than brand related components”.
The respondents submitted that the 26 May 2016 questionnaire, referred to at [6] above, contained the following relevant information:
Asia Symbol entered into agreements with some of the distributors by which the parties agree that the distributor customer will be given a discount or rebate for reaching certain purchase targets.
…
Annual and quarterly rebates were provided to Asia Symbol’s domestic customers when the customers achieved purchases above agreed target volumes. The rebate rate generally ranges from [E]% to [F]%.
Asia Symbol also provided a variety of discounts on a customer basis to its domestic customers for the sales of the GUC [goods under consideration] during the POI [period of interest].
The discount was provided to cover a range of arrangements with customers, such as special rebate/discount, warranty claim, promotion fees.
Please see Attachment 10 – EQ spreadsheet – “Discount Allocation” and “Rebate Allocation” for further details.
(Footnotes omitted.)
The respondents referred to a spreadsheet annexed to the questionnaire completed by Asia Symbol. That spreadsheet contained a screenshot of Asia Symbol’s accounting records, which identified various line items for discounts, sales rebates and commissions on sales during the period in question. The line items were recorded in the screenshot as follows:
[XXXXX X] Sales Discounts – Third party
[XXXXX X] [XXXXX X] Sales Special Discount
[XXXXX X] [XXXXX X] Sales Rebate – third party
[XXXXX X] [XXXXX X] Cash Discount
[XXXXX X] [XXXXX X] Special Rebate – Third party
[XXXXX X] [XXXXX X] Commission – Third Party
[XXXXX X] Total Unassigned Accounts
[XXXXX X]
The respondents referred to the “Discount Allocation” worksheet, in which these line items also appeared. In that worksheet, the total quantity of discounts, rebates and commissions, expressed in renminbi, was divided by the total quantity of sales, expressed in metric tonnes, to reach a “[u]nit expense (RMB/MT)” figure of –[G]. That amount, in turn, was distributed across all of Asia Symbol’s domestic sales during the relevant period. That is to say, the respondents submitted, that Asia Symbol’s own calculations did not identify the amount of any discount that it had, in fact, provided to a particular customer during the relevant period.
The respondents referred to the Initial Verification Report, referred to at [17] above, in which the ADC set out the findings of its site visit. The respondents noted that, in that report, the ADC recorded the fact that “[t]he exporter submitted calculated amounts for discounts and rebates to apply to and adjust downwards the domestic price” and that, “[a]t the verification, the exporter submitted that these amounts were all quantity based for all goods sold domestically.” The ADC also noted that the volume of goods exported to Australia was not only significantly less than that sold in the PRC, but that Asia Symbol had not provided any evidence to show that the discounts given to its customers in the PRC on goods sold in the PRC would apply to the quantity of goods exported to Australia, had those goods been sold in the PRC. The normal value of the goods was, thus, calculated by using the price paid for the goods sold in the PRC and increasing that price by making an adjustment under s 269TAC(8) of the Customs Act to account for Asia Symbol’s discounts and rebates.
The respondents referred to Asia Symbol’s submissions to the ADC on 7 and 29 December 2016, referred to at [18] and [23] above, relevantly claiming that the discounts it provided to its customers in the PRC were not based solely on quantity or volume, but were also based on the type of product purchased by the customer. The respondents referred the following attachments to each document:
•a document entitled, [XXXXX X], dated 2 January 2015 which purported to be a rebate policy (Rebate Policy); and
•three contracts for the purchase of goods which it was submitted by Asia Symbol showed that discounts had been applied to purchases of goods at low volumes (Contracts).
The respondents also referred to the ADC’s Final Report 341 which concluded that the normal value of the goods was to be determined under s 269TAC(1) of the Customs Act as the net domestic selling price with an upward adjustment under s 269TAC(8) for discounts and rebates. The respondents submitted that, in reaching that conclusion, the ADC:
•reiterated that Asia Symbol had said, during the site visit, that “these discounts were all quantity based”;
•noted that its policy was “to allow adjustments for a quantity discount where it is established that the quantity sold has an effect on price comparability”;
•noted that “the discounts applied to domestic customers would have not been available if Asia Symbol had sold similar quantities to that exported to Australia during the investigation period”, because the amount of goods sold within the PRC was “substantially higher than those exported to Australia”;
•had regard to the Rebate Policy and the Contracts and made the following findings in relation to them:
•“none of the brands listed [we]re the same product code that Asia Symbol exported to Australia” and “no evidence [w]as … provided that these brands [we]re even like goods”;
•“none of the quantity thresholds listed to achieve a given percentage discount, either monthly or annually, were reached by Asia Symbol’s Australian sales of the goods during the period”; and
•the Contracts were in Chinese with minimal English annotations and, in any event, “[t]he tables in the documents provided demonstrate[d] that in order for the percentage to apply, … a certain quantity [had to] be reached.”
The respondents referred to the ADC’s Reinvestigation Report, published on 11 December 2017, and in particular to the parts outlined at [33] above. The respondents relied on the ADC, having also assessed the rebate policy and the Contracts, making the following findings and observations in respect of them:
•The Contracts were in Chinese with only a few English annotations. Those annotations themselves “did not show or demonstrate that discounts and rebates were given on a basis other than for quantity sold.”
•Asia Symbol “made no attempt to show how the [Rebate] [P]olicy related to the [Contracts]”.
•Asia Symbol “made no attempt to reconcile the [Rebate Policy] to findings by the [ADC]’s verification team.” In particular:
•Asia Symbol’s accounting records showed an aggregated amount of RMB [H] in rebates.
•The Rebate Policy “appears to show that all sales will receive rebates of at least [I] per cent … regardless of quantity” and one per cent of gross invoice values is approximately RMB [J].
•On this basis, quantity-based rebates would account for only RMB [K], which “seem[ed] highly unlikely given that the [Rebate Policy] suggest[ed] greater rebates for quantity and many of Asia Symbol’s domestic customers purchased very large quantities.”
The respondents referred to the conference of 18 December 2017, referred to at [37] above, at which the ADRP requested the ADC to re-calculate the normal value of Asia Symbol’s goods based on its net domestic selling price with an upward adjustment for quantity based, but not brand based, discounts. As recorded at [38] above, revised calculations were provided by the ADC to the ADRP on or about 3 January 2018 resulting in a dumping margin for Asia Symbol of 3.0%, reduced from 3.1%.
The respondents referred to ADRP Report 55, as described above at [42] and following, in which the ADRP accepted the ADC’s revised calculations of the normal value of the goods. The respondents submitted that the key finding and reasons in ADRP Report 55 may be summarised as follows:
•The ADRP agreed with the ADC’s approach to calculating the normal value of the goods by using the net domestic selling price as the base and making an upward adjustment for discounts and rebates under s 269TAC(8) of the Act (at [375]).
•An upward adjustment for quantity discounts was appropriate (at [376]-[378]), as the ADRP agreed that “discounts/rebates, other than quantity discounts, would have been available from Asia Symbol in the Chinese domestic market, if the export sales had been made in that market” (at [384]).
•The ADC had assumed, however, that all of Asia Symbol’s discounts and rebates were quantity-based (at [378]).
•Having examined Asia Symbol’s Rebate Policy, the “supporting evidence provided to the [ADRP] relating to domestic sales” and extracts of its financial accounts, the ADRP noted that “various types of rebates described in the discount policy do not have the same descriptions (in terms of language) as stated in the financial records” (at [381]).
•The “element of ‘discounts and rebates’ related to brand discounts … should not have been subject to an upwards adjustment to the net domestic selling price” (at [385]). Accordingly, the ADRP asked the ADC to calculate, “on the best information available, the upwards adjustment to include all components other than brand related components” (at [386]).
•The ADC having re-calculated the normal value of the goods in accordance with the ADRP’s instructions, the dumping margin was marginally lower than that which had been determined previously (at [387]).
•The ADRP found that there was an error in assessing the normal value for Asia Symbol relating to the adjustment amount for discounts and rebates (at [388]).
•Accordingly, the ADRP recommended that the Parliamentary Secretary’s decision be revoked and substituted with a decision that the dumping margin be 3.0 per cent (at [586]-[587]).
The respondents submitted the ADC’s recalculation of the dumping margin was performed as follows.
First, the ADC started with Asia Symbol’s financial information which it provided at the Site Visit. That information could be found in the screenshot on the “Discount Allocation v2” worksheet.
Second, the ADC assumed that, save for the line item “[XXXXX X] Sales Rebate – third party” in the amount of RMB –[L], the remaining line items did not comprise solely quantity based discounts. The Sales Rebate line item, it should be noted, was “identified by the [ADC’s] verification team” as “based on q[uanti]ty”. The line item, “[XXXXX X] Commission – Third Party”, in the amount of RMB –[M], had previously been “assumed to not be a brand rebate”. Put another way, the respondents submitted, by assuming, as the ADC did when performing its most recent calculations, that the Commission line item entirely comprised non-quantity based discounts, the ADC made an assumption in Asia Symbol’s favour.
Thirdly, the ADC took the amount in the Sales Rebate line item and divided that amount by the total quantity of sales in metric tonnes ([N]), thereby reaching a “[u]nit quantity discount (RMB/MT)” of –[O].
Fourthly, in respect of each transaction listed in the “D sales (ADRP)” worksheet, in order to reach the amount in the “Quantity discount and commissions” column (W), the ADC multiplied the amount in the “Quantity” column (S) by the total of the unit quantity discount amount divided by the amount of minus 1000 (ie, W = S x (-[O]/-1000)). The amount shown in column W represented the total amount of non-brand based discounts and commissions based on this calculation. That amount, together with the amount in column X (“Rebates”) was then added to reach the figure in column BH (“Quantity discounts, commissions and rebates”).
The respondents submitted that it appeared that, contrary to the notation to the “Quantity discount and commissions” column, the ADC assumed, to Asia Symbol’s benefit, that the amount in the Commission line item comprised only brand based discounts. The respondents noted that the applicant, in its submissions filed on 8 October 2018, did not take issue with the making of this assumption. The applicant did, however, appear to take issue with the ADC’s not having excluded the amount in the Sales Rebate line item from the calculation of the normal value of its goods (cf the applicant’s 8 October 2018 submissions). It was contended by the applicant that “[t]here is no evidence to support that assumption”.
The respondents submitted that that submission was not only incorrect, but was not sufficient, in any event, to give rise to a reviewable error under ss 5(1)(h) and (3)(b) of the ADJR Act.
The respondents submitted that the first difficulty with ground 1 was that it proceeded upon a flawed premise. The Sales Rebate line item (which was taken from Asia Symbol’s accounting records) was not “assumed” to be a quantity or volume based discount. Nor did the ADRP acknowledge, or suggest, that the Sales Rebate line item contained “brand-related components”, contrary to [36] of the applicant’s submissions. As the notation to the Sales Rebate line item indicated, it was identified by the ADC’s verification team as comprising discounts based on the quantity of Asia Symbol’s goods sold in the PRC. The respondents submitted there was evidence to support the ADC’s characterisation of the Sales Rebate line item:
•The applicant’s responses to the questionnaire, which included that it “entered into agreements with some of the distributors by which the parties agree that the distributor customer will be given a discount or rebate for reaching certain purchase targets” and “[a]nnual and quarterly rebates were provided to Asia Symbol’s domestic customers when the customers achieved purchases above agreed target volumes.”
•The information given by the applicant during the site visit, relevantly, that the “amounts for discounts and rebates” in its accounting records “were all quantity based for all goods sold domestically”.
If the ADC made any assumption, the respondents submitted, it did so to the benefit of the applicant as, despite the evidence given in the questionnaire and the site visit, the remaining line items in the “Discount Allocation” worksheet were excluded from the unit quantity discount amount on the assumption that they included brand based discounts.
The second difficulty with ground 1, the respondents submitted, was that a “no evidence” ground of review under the ADJR Act could only be made in respect of a finding of fact, referring to: Bond at 355 per Mason CJ; Rajamanikkam at [32]-[33] per Gleeson CJ, [55]-[56] per Gaudron and McHugh JJ; and Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32; 241 CLR 390 at 418 [91] per Hayne, Heydon, Crennan and Kiefel JJ. A “fact” in relation to “no evidence” did not extend to an expression of opinion or a matter of judgment: Australian Retailers Association v Reserve Bank of Australia [2005] FCA 1707; 148 FCR 446 at [581], and the cases there cited, being Telstra Corporation Ltd v Seven Cable Television Pty Ltd [2000] FCA 1160; 102 FCR 517; Randwick City Council v Minister for the Environment (1998) 54 ALD 682 at 717 per Finn J, affirmed on appeal by the Full Court in Randwick City Council v Minister for the Environment [1999] FCA 1494; 167 ALR 115.
In the present case, the respondents submitted, the applicant’s complaint was not that there was no evidence for a particular fact upon which the s 269ZZM decision was based. For example, it was not being argued by the applicant that there was no evidence for the finding that the quantity based discounts offered to Asia Symbol’s customers in the PRC would not have been offered in respect of the goods exported to Australia had they been sold in the PRC, given the small quantity of exports to Australia. Nor was it being argued that there was no evidence for the finding that at least some of the discounts offered by Asia Symbol to its domestic customers were quantity based. Rather, the respondents submitted, what was being argued by the applicant was that, in the course of making an adjustment under s 269TAC(8), the ADC (and, therefore, the ADRP and the Parliamentary Secretary) made a factual error because it assumed that certain discounts which the applicant offered to its customers in the PRC were not brand based, or that the calculations carried out by the ADC did not reflect the reasoning of the ADRP in its report (referring to the applicant’s written submissions at [25], [30], [36]-[37] and [40]). The respondents submitted that neither argument was sufficient to enliven ss 5(1)(h) and (3)(b) of the ADJR Act.
The respondents submitted that the subject of the applicant’s complaint in the present case was an expression of opinion or a matter of judgment. The respondents submitted that the applicant’s complaint that there was “no evidence to support the recalculation of the dumping margin as ‘an upwards adjustment to include all components other than brand related components’” was an observation about the decision-making process itself; the process of calculation of the normal value of Asia Symbol’s goods under s 269TAC(1) of the Customs Act, or any adjustment to be made under s 269TAC(8), was not a “fact” that enlivened ss 5(1)(h) and (3)(b) of the ADJR Act.
Furthermore, the respondents submitted, the evidence did not establish that the “fact” did not exist. The difficulty faced by the applicant, the respondents submitted, was that the counterfactual posed in the applicant’s submissions was inconsistent with the contracts which it provided to the ADRP in support of its rebate policy. For example, the [XXXXX X] contract included discounts in the order of [A]%, which would appear to be consistent with the “A” category discounts in [XXXXX X] of the rebate policy. However, the brand of paper referred to in that agreement was “[XXXXX X]”, which was not a brand of paper identified in the rebate policy. In fact, the respondents submitted, the rebate policy referred to different brands of paper with codes containing the letters “[XXXXX X]”, and the contract referred to above did not indicate which, if any, of those brands was being sold thereunder. Contrary to the applicant’s written submissions, therefore, the respondents submitted the Court could not be satisfied that the Sales Rebate line item referred to discounts and rebates that “were not provided only for high volume sales”.
The respondents submitted that the decision under review did not depend upon the prior establishment of a particular fact. There was, plainly, evidence to support the ultimate decision under s 269TG of the Customs Act. The respondents submitted that was sufficient to defeat this ground of review. In any event, the respondents submitted, there was clearly evidence to support findings that Asia Symbol’s domestic sale prices were affected by discounts and rebates. The identification of which of those rebates were relevant to an adjustment under s 269TAC(8), and decisions as to how they should be reflected in an adjustment to the price per metric tonne (in the light of the limited evidence provided by Asia Symbol) were, necessarily, matters for judgment. Asia Symbol had not sought to establish, for example, that there was no evidence upon which the respondents could conclude that the rebates treated in the ADC’s calculation as quantity based were, in fact, quantity based.
In reply, the applicant submitted the respondents purported to justify the approach of the ADC and that, in circumstances where the ADRP had disagreed with a critical aspect of the ADC’s approach, corrected that approach and instructed the ADC to proceed on the basis of that correction, something more needed to be done. The respondents had not sought to engage that aspect of the ADC’s approach with which they disagreed, and which was the basis of the judicial review application.
The applicant submitted the respondents had accepted a recalculation of the dumping margin that did not answer or meet the correction made, and instruction given, by the ADRP. This had been done in the absence of any evidence to support that recalculation, insofar as it purported to be a recalculation of the normal value of Asia Symbol’s goods based on its net domestic selling price with an upwards adjustment for quantity based (but not brand based) discounts.
The applicant submitted that, having examined the discount policy and supporting evidence, including extracts of the financial accounts presented to the ADC, the ADRP:
a)acknowledged that the ADC had “assumed” that all the discounts and rebates were quantity-based, and that its approach proceeded on this basis (cf. RS [25]) [referring to ADRP Report 55 [378] and [383]];
b)accepted that discounts/rebates, other than quantity discounts, would have been available from Asia Symbol in the Chinese domestic market, if the export sales had been made in that market [referring to ADRP Report 55, [384]; see also [379]];
c)accepted that brand-related discounts should not have been the subject of an upwards adjustment to the net domestic selling price [referring to ADRP Report 55, [385]].
The applicant submitted that, contrary to the respondents’ submissions, it was evident that the ADC assumed all line items to be quantity based. So much was acknowledged by the ADRP. The attempt now to paint that as otherwise was contradictory, and an invitation to revisit the merits. In this respect the applicant submitted:
a)The first dot point in RS [25] … went no higher than to state that some discounts/rebates were quantity-based (that was not denied), and ignored the evidence that Asia Symbol “also” provided a variety of discounts to cover a range of arrangements that were not quantity-based ….
b)The second dot point in RS [25] … curiously restated a contention (viz., that the exporter submitted at the verification visit that discounts/rebates were all quantity based) that the ADRP acknowledged was rebutted by Asia Symbol at the first opportunity; and, more importantly, was itself contradicted by the ADRP.
The applicant submitted the fact that, as the respondents submitted, the ADC then made a different assumption “to the benefit of the applicant” in relation to the “remaining line items” (of significantly lesser value than the Sales Rebate line item) in the Discount Allocation worksheet, only served to underscore: (a) a “method” of assumption; and (b) an arbitrary distinction drawn between certain line items, which were assumed not to comprise solely quantity based discounts, and another line item (“Sales Rebate”) which was taken to comprise solely quantity based discounts. It was arbitrary in the absence of evidence to support such a distinction.
The applicant submitted it did not take issue with the assumption made in relation to the Commission line item. That was because, unlike the assumption made in relation to the Sales Rebate line item, it was an assumption supported by evidence.
Furthermore, the applicant submitted that there was manifold difficulty with the respondents’ submission that the Contracts provided in support of Asia Symbol’s rebate policy were inconsistent with the proposition that the Sales Rebate line item did not comprise only quantity based discounts/rebates.
The applicant submitted the respondents misunderstood the Contracts (including the [XXXXX X] contract) and the context in which these were provided to the ADC, which was to demonstrate how the rebate policy applied to customers with volume sales similar to that of Asia Symbol’s only Australian customer ([XXXXX X]). The Contracts demonstrated that a “basic rebate” (based on brand/quality of paper purchased on a quarterly and annual basis, as shown in [XXXXX X] of the rebate policy) applied irrespective of sales quantity (it simply meant there would be no “additional rebate” in [XXXXX X] of the rebate policy) and, further still, irrespective of any “bonus” for particularly high volume brackets ([XXXXX X] of the rebate policy). The point was to correct the misconception that these discounts would not apply to a customer in the domestic market who purchased the same volume of copy paper as that purchased by [XXXXX X].
The applicant submitted the Sichuan Hanlin Pty Ltd contract did not countermand the applicant’s “counterfactual” (presumably, that the “upward adjustment” did not exclude brand based discounts). Rather, it supported the proposition that the Sales Rebate line item comprised discounts/rebates that “were not provided only for high volume sales”.
Turning to its grounds of review, the applicant submitted, as to ground 1, the s 269ZZM decision revoking the s 269TG previous decision and substituting the dumping margin of 3.1% for a margin of 3.0% was based on an assertion of fact: viz, that the adjustment for discounts and rebates under s 269TAC(8) did not include brand based discounts/rebates. That was the basis upon which the respondents made their respective decisions, and it was “critical to the making of the decision” insofar as it purportedly accounted for the 0.1% reduction in the dumping margin. That was not an expression of opinion or a matter of judgment. The discounts/rebates referable to the adjustment were either based on brand/quality, or they were not. Nor could the applicant’s submission be dismissed as merely an observation about the decision-making process, although the process highlighted the error.
In that regard, the applicant submitted, the decision was “based … on the existence of a particular fact, and that fact does not exist”. This was not a case where the respondents had made an open assumption in relation to a particular fact of which there was no evidence one way or the other. The assumption made: (a) was contrary to the evidence before the decision-maker as to the manner in which Asia Symbol provided discounts/rebates in relation to domestic sales, which positively established that the “fact” did not exist, ie, that the discounts/rebates were not based purely on quantity/volume, and that they included brand based components; and (b) had no supporting evidence.
As to ground 2, the applicant submitted the decision-making process revealed the taking into account of a fact found unreasonably, and the failure to take into account a fact that a reasonable decision-maker would have found and taken into account, referring its earlier citation of Bond at 359. In that regard, the applicant submitted, the respondents took into account an irrelevant consideration and failed to take into account a relevant consideration. While the absence of evidence to support the assumption made by the respondents was a central aspect of ground 2, that did not mean that if ground 1 was rejected ground 2 must also fail. The first ground was subject to certain statutory strictures (by way of s 5(3)(b) of the ADJR Act) that did not affect the other grounds, which must be addressed on their own terms. In oral submissions, the applicant also contended that the nature of the treatment of the line items was arbitrary and that that arbitrariness also supported the ground of improper exercise of power. The applicant submitted that the fact-finding was arbitrary as being:
… inextricably linked with the fact that there was no evidence to justify the assertion that line item C6 comprised only quantity-based discounts, and the transition from the initial amended calculations to the ultimate amended calculations, where initially C6 and C9 were included and then C9 was excised for no apparent – well, we understand why C9 was excised, but it’s not apparent why C6 was not excised. That indicates an arbitrary process of reasoning or an arbitrary process.
The applicant again relied on Australian Broadcasting Tribunal v Bond at 359 per Mason CJ.
As to ground 3, the applicant advanced three reasons for why, contrary to the respondents’ submissions, Television Capricornia at 514 did not establish that a “no evidence” challenge will fail unless the power to make the decision under review depended upon the prior establishment of a particular fact. First, Wilcox J was not stating an exclusive or definitive proposition. Second, and in any event, in relation to cases in which “no evidence” was treated as an aspect of some other ground, his Honour spoke more broadly about “facts relevant to the issue to be determined”. Thirdly, this confused the operation of s 5(3)(b) of the ADJR Act with s 5(3)(a), on which the applicant did not rely.
The applicant submitted that the respondents’ submission, that there was evidence to support the “ultimate decision” under s 269TG which (it was claimed) was sufficient to defeat this ground of review, placed an unwarranted constraint on s 5(1)(h) of the ADJR Act. Furthermore, in this case, the process of reasoning by which the “ultimate decision” was reached, and the relevance to the decision of the particular finding of fact, was such that it was a “short step” from the proposition that the decision was based on the existence of a particular fact that did not exist, to the proposition that there was no evidence or other material to justify the making of the decision, referring to Rajamanikkam at [43].
The applicant submitted that the fact there was evidence to support findings that Asia Symbol’s domestic prices were affected by discounts/rebates was not to the point. The fact that the identification of which of those rebates were relevant to an adjustment under s 269TAC(8) was a matter for judgment was also a distraction. That identification was made by the ADRP at [386]: “the upward adjustment to include all components other than brand related components”. The evidence provided by Asia Symbol demonstrated that that instruction was not met.
The applicant submitted that the relevant question was whether the discounts/rebates were only quantity based. The applicant did not take issue with the proposition that discounts/rebates were referable to quantity or volume of sales. The point was that brand based discounts/rebates were provided as a “basic rebate”, irrespective of high volume of sales, and that the “Sales Rebate” line item, which was assumed by the respondents to represent incentives based only on quantity, in fact incorporated brand based incentives.
Consideration
As may be seen, many of the submissions on behalf the applicant were directed to mere disagreement with the respondents’ fact-finding. It is important in this case, where the substantive argument is one of no evidence, to distinguish between simple errors of fact, on the one hand and, on the other hand, judicially reviewable errors in fact-finding which warrant relief.
Given the limited grounds of judicial review, it does not follow that judicially reviewable error on the part of the ADC may be established from any mere factual non-compliance by the ADC with the ADRP’s request or, given the nature of its review function, that what the ADRP said about the material before it or the ADC’s recalculation answers the issue for the Court. The ADRP was engaged in a form of merits review while this Court is engaged in judicial review.
The form of merits review undertaken by the ADRP, to which I have referred, is affected by s 269ZZK which relevantly requires that in making its recommendation the ADRP must not have regard to any information other than the “relevant information”. This is defined in s 269ZZK(6) to mean, relevantly, the information to which the Commissioner had had regard or was, under s 269TEA(3)(a), required to have regard, when making the findings set out in the report under s 269TEA to the Minister in relation to the making of the reviewable decision.
Relevantly, it was in this context that the ADRP, as recorded in ADRP Report 55 at [386], asked the ADC to calculate, on the best information available, the upwards adjustment to include all components other than brand related components.
It is important to identify the decision which the applicant contends was made without evidence. Without first identifying the decision, there would be a tendency to consider whether there was any evidence for a particular finding of fact rather than, as s 5(1)(h) directs attention to, whether there was any evidence or material to justify the making of the decision. That ground of judicial review in the ADJR Act is referable to a “decision” as defined. This was the point made by Mason CJ in Bond at 359, which is further discussed at [147]ff below.
As to what the decision is when considering s 5(1)(h), in Rajamanikkam the equivalent provision was s 476(1)(g) of the Migration Act 1958 (Cth). Gleeson CJ said at [8] that it had to be kept in mind that the ultimate question was whether it had been demonstrated that there was no evidence or other material to justify the making of the Tribunal’s decision. That decision was to affirm a decision not to grant a protection visas.
At [35], his Honour said that the nature of a decision, and the process of reasoning that leads to it, will bear upon a contention that there was no evidence or other material to justify the decision, and upon a contention that the decision was based upon the existence of a particular fact. His Honour also referred to the level of particularity or generality at which a fact is identified. His Honour concluded, at [37], that he could not accept, as did the Full Court, that the decision was based upon two of the eight reasons given by the Tribunal for doubting the credibility of Dr Rajamanikkam.
Having noted that the Full Court did not explain why the case fell within s 476(1)(g), at [42], Gleeson CJ said that he found it impossible to conclude that there was no evidence or other material to justify the decision, which decision was required by law in the event that the Tribunal was not satisfied that the first respondent satisfied the criteria for refugee status. Importantly, at [43], his Honour said this:
The only part of the reasoning of the Full Court that throws light on its approach to s 476(1)(g), as distinct from s 476(4)(b), is the Court’s summary of the argument for the respondents as being that “there was no evidence or other material to justify the making of the decision … because the decision was based on the existence of particular facts that did not exist.” (Emphasis added.) That is a non sequitur. It may be that, in some cases, depending upon the nature of the decision in question, the process of reasoning by which it was reached, and the relevance to the decision of a particular finding of fact, it may be a short step from the proposition that the decision was based on the existence of a particular fact or particular facts that did not exist to the proposition that there was no evidence or other material to justify the making of the decision. But in other cases, of which the present is an example, that may be a large step. The Full Court did not explain how it took that step, or explicitly acknowledge the need to take it.
(Original emphasis.)
Justices Gaudron and McHugh, at [53], having made some observations critical of the reasoning of Mason CJ in Bond as to the “harmonisation” of ss 5(1)(f) and 5(1)(h) of the ADJR Act found that that approach was not one that could be applied to s 476, given the different language of the “error of law” ground in s 476(1)(e) of the Migration Act. Their Honours did conclude, at [56], that for the equivalent provisions in the Migration Act of both s 5(3)(a) and s 5(3)(b) of the ADJR Act it was appropriate to speak of a fact critical to the making of the decision. Their Honours said, at [58], that unless it was possible to say on a proper analysis of the decision, the reasons for decision or the decision-making process that, had a particular finding not been made, the decision in question would not have been reached, it was impossible to say that the decision was based on that finding. At [71], their Honours concluded that given the “range of factors” to which the Tribunal pointed as giving rise to doubts as to Dr Rajamanikkam’s credibility, it could not be said that the Tribunal’s decision was based on the two particular facts which did not exist.
Justice Callinan, at [156], distinguished between an erroneous finding of fact and a non-existent fact. His Honour said that not all erroneous findings of fact will necessarily involve reliance on a non-existent fact. An erroneous finding of fact will only involve the basing of a decision upon a non-existent fact if another condition is also satisfied, that an affirmative finding of fact which does not exist as been made. His Honour read what the respondents contended were affirmative findings of non-existent facts as a rejection of the first respondent’s claim, rather than as the making of affirmative findings of fact.
Justice Kirby dissented.
Tisdall v Webber was not a no evidence case. The three contended errors of method said to constitute errors of law on the part of the Professional Services Review Committee were summarised by Greenwood J, with whom Tracey J expressly agreed, at [6], [7] and [8]. At [27], his Honour said that the question to be determined by the Committee by reference to the Health Insurance Act 1973 (Cth) in making findings arising out of its adjudication of the matters relevant to the referral was whether it could be satisfied by Dr Tisdall that on each of the 66 days during the referral period there was, as a matter of objective analysis, and absence of other medical services for patients of Dr Tisdale having regard to the statutory matters of the location of Dr Tisdale practice and the characteristics of his patients seeking services on each of those days. If the Committee could be so satisfied, the second question for it was whether it could be satisfied that those circumstances affected, in a causal sense, the rendering of Dr Tisdall’s services on each of those days.
At [29], Greenwood J noted that the exercise of the power to make findings of fact under s 106KA(2) turned upon the state of satisfaction of the Committee members. The state of satisfaction must be reached (or not reached) having regard to the statutory matters. The exercise of the statutory power to make findings was conditional upon a particular opinion or state of satisfaction and an inquiry for the Court was whether the opinion had really being formed at all, as a matter of law.
There were two reasons why the Committee was not satisfied of an absence of other medical services. The first was that the Committee had formed the view that other medical practitioners were likely to have had the capacity to see and render services to Dr Tisdall’s patients. Secondly, those medical practitioners, having that capacity, would not have refused to see Dr Tisdall’s patients. At [82], Greenwood J said that neither of those explanations for the Committee’s state of non-satisfaction actually dealt with the evidence put to the Committee by Dr Tisdall. At [86], Greenwood J said that the Committee members were not entitled to make findings of fact informing its state of non-satisfaction of the statutory factors based upon assumptions of likely capacity and likely disposition to see patients, unsupported by actual evidence, or simply based upon inferences drawn from statistics which did not reveal facts about the reasons for statistical rates of attendance.
The essence of the reasoning of Buchanan J, with whom Tracey J also agreed, may be seen at [133]-[134], as follows:
… the only basis for rejecting Dr Tisdall’s case to that effect was rejection, out of hand, of the evidence on which he relied. There are two problems with any suggestion that the Committee was entitled to take such a course by reference to some notion of its collective experience or knowledge. First, it did not say that is what it was doing. It gave an impression of evaluating the evidence given on Dr Tisdall’s behalf against countervailing factors. Those countervailing factors, however, were in the end only its assumptions, which it preferred over all the sworn evidence. Secondly, the principle that an administrative tribunal (or a court) is not bound to accept evidence merely because it is “uncontradicted” does not provide a licence to disregard evidence having real probative value, much less to put aside a whole body of evidence of that character. It was not submitted on the present appeal that the evidence was unworthy of consideration or lacking in probative effect, although some unconvincing attempts were made to marginalise it by reference to the period of which the witnesses spoke. In my view, those suggestions did not diminish the overall effect of the evidence. There was no other reason given why such evidence should not be accepted. Repetition of the proposition that Dr Tisdall bore the onus of making out his case did not address the necessity for the Committee to deal, in a satisfactory way, with the case which he did present. As I said earlier, the Committee did not say that the evidence had no weight. The Committee’s finding that there was no absence of services available to Dr Tisdall’s patients in the relevant period seems explained by nothing else but the speculative conclusion that those services would have been made available by other practices.
Thus, in my opinion, Tisdall v Webber is of no present assistance given the different nature of the decision-making body, given that the statutory power was conditional on a particular opinion or state of satisfaction and given the basis upon which that case was argued and decided.
In the present case, the ultimate decision was that of the Parliamentary Secretary made on 9 March 2018 revoking the reviewable decision and substituting a new decision resulting in a dumping margin of 3.0%.It was not submitted that there was an intermediate s 269TAC “decision” as contemplated in Bond.
Not in separate dispute was the rationale or the underlying logic of the exercise. This was that in the case of a quantity based discount, the Australian customers buying relatively small amounts did not have access to those discounts and it was appropriate to add back that quantity discount, pursuant to s 269TAC(8), in order to reach an appropriate figure for the normal value.
It is unnecessary in the present case to seek to resolve any question of “harmonising” ss 5(1)(f) and 5(1)(h) of the ADJR Act as considered by Mason CJ in Bond and by Gaudron and McHugh JJ in Rajamanikkam. I note that in Rajamanikkam some reservation was expressed by Gaudron and McHugh JJ at [51]-[53] about what the Chief Justice had said in Bond. The respondents’ counsel were not aware of a no evidence case that relied solely on s 5(1)(f) but suggested there was some wisdom in what Wilcox J pointed out at 514 of Television Capricornia which is that if one was to uphold grounds based on error of law for no evidence then that should only happen where there was no evidence of some fact that was actually critical to the decision.
Ground 1
The essential question is was there any material to found what occurred in relation to the figure in C6, that is, was there no evidence to support the proposition that C6 was entirely quantity based? This proposition was critical to the recommendation and ultimate determination of normal value and the resulting dumping margin of 3.0%.
That the asserted error here comes down to a “calculation error” does not answer the point if there was no evidence of a critical integer of the calculation.
Similarly, that the statutory task was one of assessment of an appropriate figure, that being an assessment that involved many exercises of judgment (including particularly as to what adjustments were appropriate to make the figure for normal value a suitable comparator with export price), does not answer the point if there was no evidence of a critical integer of the assessment.
In my view no separate legal error arises from the fact, or terms, of the ADRP’s “instruction” to the ADC. This is because the ADRP did not say that any particular evidence or material could not be used by the ADC, but rather that it had asked the ADC to calculate the upwards adjustment “on the best information available”. I accept the respondents’ submission that neither the requirement under s 269ZZL, set out at [137] below, nor what appears at [386] of ADRP Report 55, stated that some identifiable class of discounts were to be excluded or some identified percentage of the discounts were to be excluded. Further, what is said at [385] was in the statutory context where only “relevant information” as defined in s 269ZZK could be taken into account by the ADRP.
I note that under s 269ZZL, the ADRP required the ADC to reinvestigate a specific finding, relevantly, the calculation of the normal value for Asia Symbol. The ADC conducted that reinvestigation. The ADRP’s reasons for requiring the reinvestigation were recorded in a letter to the ADC as follows:
Please consider the information in the application for review, which contain [sic] extracts from the Greenpoint/Asia Symbol earlier submission regarding discounts and rebates following the SEF, dated 29 December 2016, and, also the application to this review which elaborates on the normal value and adjustment provisions to enable a fair comparison between domestic and export sales.
I draw your attention to the case of Norland [sic] Papier AG v Anti-Dumping Authority [1999] FCA 10 (Norland) [sic], which considers whether a rebate (or discount) may be part of the price established between a buyer and seller.
The domestic selling price used in the normal value calculation should, prima facie, be the net price. It is then necessary to consider what adjustments under s.269TAC(8) of the Act, if any, would have been available if the export sale had been made in the domestic market. Asia Symbol has provided its Domestic Sales Rebate Policy document and also examples of customers in the domestic market which it considers equivalent to the export sales to Australia.
Please explain the rationale for any adjustments under s.269TAC(8) of the Act regarding discounts and rebates.
It seems to me that the ADRP’s powers to “instruct” the ADC go no further under s 269ZZL(1). It is significant that the ADRP accepted at [387] that the ADC had reinvestigated the calculation of the Asia Symbol’s normal value in accordance with the ADRP’s requirements, as the ADC was required by s 269ZZL(2) to do. By s 269ZZK(4A), the ADRP was then obliged to have regard to the ADC’s Reinvestigation Report in making its recommendations.
I note the terms of s 269ZZRB which provides that in reviewing a reviewable decision under Subdivision C the ADRP may seek further information from the ADC in relation to information that was before the ADC when the ADC made the reviewable decision. In making a decision on the review, the ADRP may also have regard to that further information. It does not appear to me that this power was exercised by the ADRP in this case.
The issue then is whether there was “no evidence” that the discount or rebate excluded brand based discounts. More accurately, the finding was a positive finding that the discounts and rebates were only quantity based discounts and rebates and the true question is whether there was “no evidence” to justify the making of that finding: see Rajamanikkam at [156] per Callinan J. In posing the question in that way I am assuming, in favour of the applicant, that this finding was equivalent to or a proxy for the decision itself.
In my opinion there was at least some evidence or material to justify that finding such that it could not be said that there was no evidence. There was also a logical or rational relationship between that evidence or material and the decision. These conclusions go hand-in-hand. It follows that any complaints about the fact-finding by the respondents (eg, that the finding was contrary to other material before the decision-maker or to the objective facts) could only give rise to mere errors of fact: at best such an error, if established, was one of fact not involving making a finding of fact for which there was no evidence or material so as to give rise to an error of law.
The evidence or material includes the statement in the exporter questionnaire jointly completed by Greenpoint and the applicant that Asia Symbol entered into agreements with some of the distributors by which the parties agreed that the distributor customer would be given a discount or rebate for reaching certain purchase targets. It also includes the statement in that questionnaire that annual and quarterly rebates were provided to Asia Symbol’s domestic customers when the customers achieved purchases above agreed target volumes, with a rebate rate within a general range. Further, the ADC’s Initial Verification Report records that at the visit by the verification team the exporter submitted that the amounts it had calculated for discounts and rebates to apply to and adjust downwards the domestic price were all quantity based for all goods sold domestically.
Thus the affidavit of Mr Wang Yu Liang dated 21 February 2019, going to the existence of the relevant facts per s 5(3)(b) of the ADJR Act, falls away as the precondition in s 5(1)(h), that there was no evidence or other material to justify the making of the decision, is not met. I note however that the deponent does not deny that the exporter submitted to the verification team that the amounts it had calculated for discounts and rebates to apply to and adjust downwards the domestic price were all quantity based for all goods sold domestically.
This ground fails.
Ground 2
In terms of the grounds of review, ground 2 involves alternative legal characterisations of ground 1. It will be recalled that ground 2 is in the following terms:
In the absence of an evidentiary foundation for the recalculation of normal value, resulting in a dumping margin of 3.0%, the recommendation in the ADRP Report 55 and the Decision were an improper exercise of the power conferred by the enactment in pursuance of which they were purported to be made, within the meaning of s 5(1)(e) of the ADJR Act.
It may also be recalled that this ground had two limbs, both reliant on Australian Broadcasting Tribunal v Bond at 359. The first was that the error fact relied on in relation to ground 1 meant that the respondents had taken into account an irrelevant consideration. The second was that the exercise of the power was arbitrary in that the discriminate treatment of the line items in the absence of evidence was of an arbitrary nature.
The passage in Australian Broadcasting Tribunal v Bond relied on by the applicant in relation to ground 2 was as follows:
However, in several decisions [of the Federal Court] it has been suggested that findings of fact which are unreasonable or arbitrary may be reviewed under s. 5(1)(e) and (2)(a) and (b): see Singh v. Minister for Immigration and Ethnic Affairs; Independent F.M. Radio Pty. Ltd. v. Australian Broadcasting Tribunal; Minister for Immigration, Local Government and Ethnic Affairs v. Pashmforoosh. In the last-mentioned case, Davies, Burchett and Lee JJ. said.
“Thus, decisions may be set aside because, being insufficiently supported by reason, they appear to be an improper exercise of the power conferred or arbitrary or because there was no evidence or other material sufficient to justify the making of the decision or the decision was so unreasonable that no reasonable person could have so exercised the power. The making of, or failure to make, a particular finding of fact in the course of the reasoning process may equally be attacked on any such ground. The taking into account of a fact found unreasonably or the failure to take into account a fact that a reasonable decision-maker would have found and taken into account provides a ground of review under ss. 5(1)(e) and 5(2)(a) and (b) of the A.D.(J.R.) Act. (Emphasis added.)”
This statement is unobjectionable to the extent that a finding of fact constitutes a “decision” such that it can be reviewed for unreasonableness and on other appropriate grounds. But if the finding does not constitute a “decision”, it is beyond review independently of such a “decision”. In accordance with what I have already said, a finding of fact will then be reviewable on the ground that there is no probative evidence to support it and an inference will be reviewable on the ground that it was not reasonably open on the facts, which amounts to the same thing.
(Footnotes omitted.)
In my opinion, the substance of what Mason CJ said in Australian Broadcasting Tribunal v Bond at 359 was to distinguish between mere findings of fact on the one hand and findings of fact that constitute a “decision” on the other hand. If a finding of fact constitutes a “decision” then the finding itself can be reviewed for unreasonableness and on other appropriate grounds but, as his Honour said, if the finding does not constitute a “decision”, it is beyond review independently of such a “decision”.
I do not regard Mason CJ as having said that making a finding of fact for which there is no evidence means that a decision is an improper exercise of the power conferred by the enactment, referring to taking an irrelevant consideration into account or failing to take a relevant consideration into account.
So far as concerns taking into account prohibited considerations and failing to take into account mandatory relevant considerations, this principle of judicial review was explained by McHugh, Gummow and Hayne JJ in Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; 206 CLR 323 at [74], as follows:
It may be, for example, that a particular statute makes the matters which are advanced in the course of a process of decision-making relevant considerations for the decision-maker. What is important, however, is that the grounds of judicial review that fasten upon the use made of relevant and irrelevant considerations are concerned essentially with whether the decision-maker has properly applied the law. They are not grounds that are centrally concerned with the process of making the particular findings of fact upon which the decision-maker acts.
(Emphasis added.)
See also, more recently, Wattie v Industrial Relations Secretary on behalf of the Secretary of the Department of Justice (No 2) [2018] NSWCA 124 at [132] and following.
I therefore regard this limb of ground 2 as misconceived.
As to the second limb of ground 2, arbitrary fact-finding, and assuming it to be pleaded, the relevant reference in the judgment of the Full Court in Minister for Immigration, Local Government and Ethnic Affairs v Pashmforoosh (1989) 18 ALD 77 is to a decision being insufficiently supported by reason, and therefore appearing “to be an improper exercise of the power conferred or arbitrary or because there was no evidence or other material sufficient to justify the making of the decision or the decision was so unreasonable that no reasonable person could have so exercised the power.” (Emphasis added.)
In my opinion, the Full Court was not saying, and Mason CJ was not approving the Full Court as having said, that arbitrary fact-finding meant that the making of the decision was an improper exercise of the power conferred by the enactment. The word “arbitrary” in the passage I have set out above is separated from “no evidence” by the word “or”.
This case was not argued by the applicant on the basis that the fact-finding process meant that the outcome was legally unreasonable: there was “no self-standing ground of unreasonableness.”
I therefore regard this second limb of ground 2 as also misconceived. It adds nothing to ground 1. If the applicant did not succeed on its “no evidence” ground, counsel did not suggest that it succeeded on the arbitrariness ground.
I would dismiss ground 2.
Ground 3
Ground 3 is that in the absence of an evidentiary foundation for the recalculation of normal value, resulting in a dumping margin of 3.0%, the recommendation in ADRP Report 55 and the decision involved an error of law within the meaning of s 5(1)(f) of the ADJR Act.
This ground I regard as having a firmer conceptual foundation. It relies on what Mason CJ said in Australian Broadcasting Tribunal v Bond at 358 when his Honour said, in seeking to harmonise s 5(1)(f) and s 5(1)(h) of the ADJR Act, that the better view was to treat “error of law” in s 5(1)(f) as embracing the “no evidence” ground as it was accepted and applied in Australia before the enactment of the ADJR Act. By this, his Honour meant that the making of findings and the drawing of inferences in the absence of evidence was an error of law, referring to what Barwick CJ and Gibbs J had said in Sinclair v Maryborough Mining Warden (1975) 132 CLR 473 at 481 and 483.
The point is, in my view, made clear in a later decision of the High Court, Kostas v HIA Insurance Services Pty Ltd. That decision did not concern the ADJR Act but s 67(1) of the Consumer, Trader and Tenancy Tribunal Act 2001 (NSW) and the term “a question with respect to a matter of law”. In the joint judgment of Hayne, Heydon, Crennan and Kiefel JJ at [91], their Honours said of the general law:
Whether there was no evidence to support a factual finding is a question of law, not a question of fact. The Tribunal's factual finding in this case, that the builder had served the two relevant claims for extension of time, necessarily depended upon its first accepting that there was evidence to support the finding. As Dixon CJ said in Gurnett v Macquarie Stevedoring Co Pty Ltd [No 2]:
“in the legal dichotomy between questions of fact and questions of law we place under the latter head a question whether there is sufficient evidence to submit to a jury in support of a cause of action. That is because it is a question for the court to decide and not for a tribunal of fact.”
A tribunal that decides a question of fact when there is “no evidence” in support of the finding makes an error of law. What amounts to material that could support a factual finding is ultimately a question for judicial decision. It is a question of law.
(Footnotes omitted. Original emphasis.)
Similarly, the question whether a particular inference can be drawn from facts found is a question of law Australian Broadcasting Tribunal v Bond at 355 per Mason CJ.
In my opinion, ground 3 adds nothing to ground 1 and it is not necessary to consider it further. This is because in addressing the question whether there was no evidence or other material to justify the making of the decision within s 5(1)(h) of the ADJR Act the same approach should be taken as would apply if s 5(1)(f) were to pick up the common law principle as explained in Kostas. That is, in deciding whether there is no evidence or other material to justify the decision, within the meaning of s 5(1)(h), what amounts to evidence or other material that could so justify it is a question of law. As I have said at [141]-[142] above, in my opinion there is evidence or material which could justify the relevant factual finding, and decision, in this case.
I would therefore dismiss ground 3.
Conclusion and orders
The application is dismissed, with costs. The parties should have a short period, 14 days, to consider whether these reasons contain any material covered by non-publication orders.
I certify that the preceding one hundred and sixty-three (163) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Robertson. Associate:
Dated: 30 May 2019
16
4