Customs (Definition of “compliance period”) Determination 2013

Administered by Department of Industry, Science and Resources

Legislation au F2013L02172 In force Legislative Instrument

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EXPLANATORY STATEMENT

 

Issued by the authority of the Minister for Industry

 

Subject: - Customs Act 1901

 Customs (Definition of “compliance period”) Determination 2013

 

Authority

 

Subsection 269T(1A) of the Customs Act 1901 provides that the Minister may, by legislative instrument,  prescribe the definition of compliance period in subsection (1).

 

Purpose and operation

 

This determination sets out the method by which compliance period in subsection 269T(1) of the Customs Act 1901 is to be calculated.

 

Background

 

Thus Determination defines the term “compliance period” for the purposes of determining if the Minister is not required to have regard to the lesser duty rule.

 

Subsections 8(5B), 8(5BA), 9(5AA), 10(3C), 10(3D), 11(5) of the Customs Tariff (Anti-Dumping)  Act 1975 require the Minister to consider the desirability of fixing a lesser amount of duty than the dumping (or subsidy) margin where the imposition of that lesser amount is adequate to remove injury. This is referred to as the “lesser duty” rule.

 

The Minister is not required to have regard to the lesser duty rule where the Minister is satisfied that certain circumstances exist, as prescribed in subsections 8(5BAA), 8(5BAAA), 9(5AAA), 10(3CA), 10(3DA), 11(5A) of the Customs Tariff (Anti-Dumping) Act 1975 and subsections 269TG(5A), 269TJ(3BA) of the Customs Act 1901.  The removal of the requirement for the mandatory consideration of the lesser duty rule in particular circumstances was introduced by the Customs Amendment (Anti-dumping Measures) Act 2013 and the Customs Tariff (Anti‑Dumping) Amendment Act 2013.

 

The finding of these circumstances does not prevent the Minister from considering and applying the lesser duty rule where those specified circumstances exist and where the Minister considers it would be appropriate to do so.

 

One of the prescribed circumstances in which the Minister is not required to have regard to the lesser duty rule is where the country in relation to which the subsidy has been provided has not complied with Article 25 of the Agreement on Subsidies and Countervailing Measures for the “compliance period”.   Subsection 269T(1A) of the Customs Act 1901 allows the Minister to make a legislative instrument for the purposes of defining “compliance period”.

 

Article 25 of the World Trade Organization Agreement on Subsidies and Countervailing Measures requires World Trade Organization Members to notify subsidies.  Article 25.1 requires notifications to be provided no later than 30 June of each year (in respect of the previous calendar year).  Notwithstanding that Article 25.1 specifies an annual notification, the World Trade Organization Committee on Subsidies and Countervailing Measures agreed, in 2005, to extend for an indefinite period its prior (2001 and 2003) decisions that new and full notifications should be submitted every two years, and that annual updating notifications should be de-emphasised.

 

For the purposes of establishing whether the Minister is not required to have regard to the lesser duty rule, consideration will be given to whether the country in which the subsidy has been provided has made one or more full and new subsidy notifications within the “compliance period”.  The “compliance period”, for the purpose of this assessment, comprises the two most recent biennial reporting periods ending prior to the initiation of the investigation.

 

For example, if a countervailing investigation is initiated in February 2014, consideration will be given to whether the country in which the subsidy has been provided has submitted a notification within the “compliance period”.  The “compliance period” would encompass the two biennial reporting periods most recently concluded prior to the initiation of the investigation.  This would comprise the new and full subsidy notifications due on 30 June 2013 (which covers the period 1 January 2011 to 31 December 2012 inclusive) and 30 June 2011 (which covers the period 1 January 2009 to 31 December 2010 inclusive).  If the country has provided at least one of either the 2013 or 2011 new and full subsidy notifications, the Minister is required to have regard to the lesser duty rule.  If neither the 2013 nor the 2011 new and full subsidy notification has been provided, the Minister is not required to have regard to the lesser duty rule.

 

When assessing whether relevant notifications have been submitted, consideration will be given to the latest Report of the Committee on Subsidies and Countervailing Measures (published in October or November of each year).  The Committee’s annual reports include annexures that set out the status of notifications by Members for relevant reporting periods on a biennial basis (reflecting the earlier decisions of the Committee that new and full notifications should be submitted every two years). 

 

This assessment will apply only where the country is subject to an obligation to make subsidy notifications to the World Trade Organization.

 

Commencement

 

This Determination commences on commencement of the Customs Amendment (Anti-dumping Measures) Act 2013.

 

Consultation

 

The Commonwealth undertook targeted consultation on the implementation of the reforms that are given effect by the Customs Amendment (Anti-dumping Measures) Act 2013 and the Customs Tariff (Anti-Dumping) Amendment Act 2013.  On 25 March 2013 the International Trade Remedies Forum, whose members consist of anti‑dumping stakeholders, was consulted on the implementation of the reforms included in the Customs Amendment (Anti-dumping Measures) Act 2013.  Following this, on 24 May 2013 members of the International Trade Remedies Forum were provided with an exposure draft of the Customs Amendment (Anti-dumping Measures) Act 2013 and the Customs Tariff (Anti‑Dumping) Amendment Act 2013.

 

The International Trade Remedies Forum brings together representatives from Australian manufacturers and producers, importers, downstream industry, industry associations, unions, and relevant Government agencies.  The International Trade Remedies Forum provides high-level strategic advice and feedback to the Government on the implementation and monitoring of reforms to Australia’s anti‑dumping system. 


Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 Customs (Definition of “compliance period”) Determination 2013

This Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 Overview

The purpose of the Determination is to define the term “compliance period” to clarify the operation of relevant provisions of the Customs Act 1901 that allow, in certain circumstances, for the Minister to not have regard to the lesser duty rule.

 

One of the prescribed circumstances in which the Minister is not required to have regard to the lesser duty rule is where the country in which the subsidy has been provided has not complied with Article 25 of the Agreement on Subsidies and Countervailing Measures for the “compliance period”.

 

For the purposes of determining whether the Minister is not required to have regard to the lesser duty rule, the “compliance period” comprises the two most recently concluded biennial reporting periods in which a World Trade Organization member is obliged to provide new and full subsidy notifications. 

Human rights implication

This Instrument does not engage any of the applicable rights or freedoms.

Conclusion

The Instrument is compatible with human rights as it does not raise any human rights issues.

 

The Minister for Industry, the Honourable Ian Macfarlane MP

 

Overview

The Customs (Definition of “compliance period”) Determination 2013 was enacted to provide clarity on the term "compliance period" in the Customs Act 1901, specifically in the context of determining when the Minister for Industry is not required to consider the lesser duty rule under anti-dumping measures. This determination was made under the authority of Subsection 269T(1A) of the Customs Act 1901, allowing the Minister to define this term through a legislative instrument. The policy objective is to align Australia's compliance period with international standards as set by the World Trade Organization’s Agreement on Subsidies and Countervailing Measures, particularly regarding the biennial submission of subsidy notifications. The determination was introduced to ensure consistency and fairness in the application of anti-dumping duties, facilitating better trade practices and compliance with international trade agreements. This determination became effective from the commencement of the Customs Amendment (Anti-dumping Measures) Act 2013, following targeted consultations with the International Trade Remedies Forum, which includes representatives from various sectors affected by trade remedies. The consultation process aimed to gather strategic advice and feedback on the implementation and monitoring of Australia’s anti-dumping reforms, ensuring that the interests of manufacturers, importers, industry associations, and government agencies were considered. The determination does not engage any applicable rights or freedoms under the international human rights instruments, thereby being fully compatible with human rights as affirmed in the Human Rights (Parliamentary Scrutiny) Act 2011.

Scope and Application

The Customs (Definition of “compliance period”) Determination 2013 applies to the definition of the term “compliance period” in the Customs Act 1901, particularly in the context of determining whether the Minister for Industry is required to consider the lesser duty rule in anti-dumping investigations. This Determination applies to entities and persons involved in the importation of goods into Australia and those subject to anti-dumping measures under the Customs Tariff (Anti-Dumping) Act 1975. The geographic reach of this Determination is national, as it pertains to the compliance with international trade agreements and obligations under the World Trade Organization. This Determination does not specify any exclusions or exemptions but sets out a method for calculating the compliance period based on the biennial reporting periods for subsidy notifications as agreed upon by the World Trade Organization Committee on Subsidies and Countervailing Measures. The Determination is compatible with human rights as it does not engage any of the applicable rights or freedoms. The Minister for Industry, the Honourable Ian Macfarlane MP, is the issuing authority for this Determination, which commenced on the commencement of the Customs Amendment (Anti-dumping Measures) Act 2013. The Determination extends the application of the Customs Act 1901 by providing a legislative instrument to define the “compliance period” for determining the Minister's consideration of the lesser duty rule. This is achieved through subordinate legislation that interprets and implements the main Act, thereby shaping the practical application of anti-dumping measures in Australia. The scope of this Determination is limited to the interpretation of the compliance period for the purposes of the lesser duty rule and does not extend to other areas of the Customs Act or the Customs Tariff (Anti-Dumping) Act 1975.

Key Provisions

The Customs (Definition of “compliance period”) Determination 2013 sets out how the term “compliance period” is to be calculated under subsection 269T(1) of the Customs Act 1901 (section 1). This determination is crucial for establishing whether the Minister for Industry is required to consider the “lesser duty rule” under certain circumstances, particularly when dealing with anti-dumping measures. The term “compliance period” refers specifically to the two most recent biennial reporting periods in which a country is obliged to submit new and full subsidy notifications to the World Trade Organization (WTO) (section 2). Under the Customs Act 1901, the Minister is required to consider whether to apply the lesser duty rule in specific cases of anti-dumping duties, unless certain conditions are met. One such condition is whether the country in question has complied with its obligations to notify subsidies under Article 25 of the WTO Agreement on Subsidies and Countervailing Measures during the compliance period. If a country has not submitted the required notifications within the compliance period, the Minister is not required to consider the lesser duty rule (section 3). This obligation ensures that countries are transparent in their subsidy practices and that Australia can effectively implement its anti-dumping measures without being hindered by incomplete or outdated information. Failure to comply with the requirements of the Customs (Definition of “compliance period”) Determination 2013 can lead to significant consequences, particularly for the entities involved in anti-dumping investigations. While the Determination itself does not explicitly outline specific penalties for non-compliance, breaches of the broader Customs Act 1901 or the Customs Tariff (Anti-Dumping) Act 1975 could result in civil or criminal penalties. For example, knowingly providing false or misleading information in relation to an anti-dumping investigation can attract penalties under section 269U of the Customs Act 1901, which can include fines of up to $22,200 for individuals and significantly higher fines for corporations. Additionally, the Minister has the authority to impose administrative penalties or seek injunctions or other remedies in cases of non-compliance. The Customs (Definition of “compliance period”) Determination 2013 is compatible with human rights as it does not engage any of the applicable rights or freedoms. The determination is designed to ensure that the anti-dumping measures comply with international trade obligations while protecting the interests of Australian industries. It does not raise any human rights issues and therefore does not require any special scrutiny under the Human Rights (Parliamentary Scrutiny) Act 2011. This compatibility ensures that the implementation of the Determination does not infringe upon the rights and freedoms of individuals or entities involved in the anti-dumping process.

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