A trade remedial investigation is initiated upon receipt of a “duly documented” written application filed by or on behalf of the ‘Domestic Industry’. So, the application must be filed by or on behalf of those domestic producers who can be considered ‘domestic industry’ for the purpose under the law.
“Domestic industry” means the domestic producers as a whole engaged in the manufacture of the like article and any activity connected therewith or those whose collective output of the said article constitutes a major proportion of the total domestic production of that article except when such producers are related to the exporters or importers of the alleged dumped article or are themselves importers thereof in such case the term ‘domestic industry’ may be construed as referring to the rest of the producers.
The terms ‘major proportion’ used in the definition of domestic industry relate to its representativeness rather than ‘majority’. The WTO has unambiguously held that the term domestic industry is not defined in terms of producers of the major proportion but refers to producers of a major proportion of domestic production.
The definition of Domestic Industry specifically permits exclusion of some categories of producers in certain situations from qualifying as Domestic Industry. The difference in the definition of Domestic Industry under dumping law and subsidy law lies in the use of the words ‘may’ and ‘shall’ under the dumping law and countervailing law respectively. The dumping law suggests that the two types of producers in question, i.e. related producers and producers importing the dumped product, are not automatically excluded from being part of the domestic industry.
The AD and the SCM rules exclude the following producers from the definition of Domestic Industry in certain circumstances: i. Producers related to exporters or importers. ii. Producers who are themselves importers. But considering that the rules define domestic industry as ‘domestic producers as a whole’, the mere fact of imports by a domestic manufacturer or relationship of a domestic manufacturer with a foreign producer or importer does not imply automatic exclusion.
Also, there is no provision for the exclusion of the production meant for captive consumption from defining domestic industry under Indian law or WTO Agreement.
The definition of domestic industry under the AD Rules has been amended a number of times, paving the way moderately easier for the Domestic Industries,
The definition of domestic industry under the Indian subsidy law needs appropriate amendment to widen its horizon and give discretionary powers to the investigating authorities as in the case of anti dumping law to decide over the issue of inclusion or exclusion of related producers from the purview of domestic industry on the merits of the respective cases.
©Forum for Trade Remedies™ 2016