Annual Report March 31, 2012 - Chapter III

Chapter III - Dumping and Subsidizing Injury Inquiries and Reviews

Process

Under SIMA, the CBSA may impose anti-dumping and countervailing duties if Canadian producers are injured by imports of goods into Canada:

  • that are sold at prices lower than sales in the home market or lower than the cost of production (dumping), or
  • that have benefited from certain types of government grants or other assistance (subsidizing).

The determination of dumping and subsidizing is the responsibility of the CBSA. The Tribunal determines whether such dumping or subsidizing has caused “injury” or “retardation” or is threatening to cause injury to a domestic industry.

Preliminary Injury Inquiries

A Canadian producer or an association of Canadian producers begins the process of seeking relief from alleged injurious dumping or subsidizing by making a complaint to the CBSA. If the CBSA initiates a dumping or subsidizing investigation, the Tribunal initiates a preliminary injury inquiry under subsection 34(2) of SIMA. The Tribunal seeks to make all interested parties aware of the inquiry. It issues a notice of commencement of preliminary injury inquiry that is published in the Canada Gazette and forwarded to all known interested persons.

In a preliminary injury inquiry, the Tribunal determines whether the evidence discloses a “reasonable indication” that the dumping or subsidizing has caused injury or retardation, or is threatening to cause injury. The primary evidence is the information received from the CBSA and submissions from parties. The Tribunal seeks the views of parties on what are the like goods and which Canadian producers comprise the domestic industry. In most cases, it does not issue questionnaires or hold a public hearing. The Tribunal completes its inquiry and renders its determination within 60 days.

If the Tribunal finds that there is a reasonable indication that the dumping or subsidizing has caused injury or retardation, or is threatening to cause injury, it makes a determination to that effect, and the CBSA continues the dumping or subsidizing investigation. If there is no reasonable indication that the dumping or subsidizing has caused injury or retardation, or is threatening to cause injury, the Tribunal terminates the inquiry, and the CBSA terminates the dumping or subsidizing investigation. The Tribunal issues reasons for its decision not later than 15 days after its determination.

Preliminary Injury Inquiry Activities

Preliminary injury inquiry No. PI-2011-001 PI-2011-002 PI-2011-003
Product Pup joints Stainless steel sinks Potassium silicate solids
Type of case/country Dumping and subsidizing/China Dumping and subsidizing/China Dumping and subsidizing/Pakistan
Date of determination November 14, 2011 December 28, 2011 March 6, 2012
Determination Reasonable indication of injury or retardation or of threat of injury Reasonable indication of injury or of threat of injury Reasonable indication of injury or of threat of injury
Participants 6 9 4
Exhibits 32 31 60
Pages of official record 1,000 2,200 4,350

Preliminary Injury Inquiries Completed in Fiscal Year and in Progress at the End of the Fiscal Year

As illustrated in the above table, the Tribunal completed three preliminary injury inquiries in the fiscal year. There were no preliminary injury inquiries in progress at the end of the fiscal year.

Final Injury Inquiries

If the CBSA makes a preliminary determination of dumping or subsidizing, the Tribunal commences a final injury inquiry under section 42 of SIMA. The CBSA may levy provisional duties on imports from the date of the preliminary determination. The CBSA continues its investigation until a final determination of dumping or subsidizing is made.

As in a preliminary injury inquiry, the Tribunal seeks to make all interested parties aware of its inquiry. It issues a notice of commencement of inquiry that is published in the Canada Gazette and forwarded to all known interested parties.

In conducting final injury inquiries, the Tribunal requests information from interested parties, receives representations and holds public hearings. The Tribunal's staff carries out extensive research for each inquiry. The Tribunal sends questionnaires to Canadian producers, importers, purchasers, foreign producers and exporters. Based primarily on questionnaire responses, the Tribunal's staff prepares a report that focuses on the factors that the Tribunal must consider in arriving at its decision on injury or retardation or threat of injury to a domestic industry. The report becomes part of the case record and is made available to counsel and parties.

Parties participating in the proceedings may present their own cases or be represented by counsel. Confidential or business-sensitive information is protected in accordance with provisions of the CITT Act.

The Special Import Measures Regulations prescribe factors that the Tribunal must consider in its determination of whether the dumping or subsidizing of goods has caused injury or retardation or is threatening to cause injury to a domestic industry. These factors include, among others, the volume of dumped or subsidized goods, the effects of the dumped or subsidized goods on prices and the impact of the dumped or subsidized goods on domestic production, sales, market share, profits, employment and utilization of domestic production capacity.

The Tribunal holds a public hearing about 90 days after the commencement of the inquiry, i.e. after the CBSA has made a final determination of dumping or subsidizing. At the public hearing, Canadian producers attempt to persuade the Tribunal that the dumping or subsidizing of goods has caused injury or retardation or is threatening to cause injury to a domestic industry. Importers, foreign producers and exporters may challenge the Canadian producers' case. After cross-examination by parties and questioning by the Tribunal, each side has an opportunity to respond to the other's case and to summarize its own. In many inquiries, the Tribunal calls witnesses who are knowledgeable of the industry and market in question. Parties may also seek the exclusion of certain goods from the scope of a Tribunal finding.

The Tribunal must issue its finding within 120 days from the date of the preliminary determination of dumping and/or subsidizing issued by the CBSA. It has an additional 15 days to issue a statement of reasons supporting the finding. A Tribunal finding of injury or retardation or threat of injury to a domestic industry is required for the imposition of anti-dumping or countervailing duties by the CBSA.

Final Injury Inquiry Activities

Inquiry No. NQ-2010-002 NQ-2011-001 NQ-2011-002
Product Steel grating Pup joints Stainless steel sinks
Type of case/country Dumping and subsidizing/China Dumping and subsidizing/China Dumping and subsidizing/China
Date of finding April 19, 2011 In progress In progress
Finding Injury    
Questionnaires sent 172    
Questionnaires received 83    
Requests for exclusions -    
Requests for exclusions granted -    
Participants 1    
Exhibits 637    
Pages of official record 10,000    
Public hearing days 4    
Witnesses 7    

Final Injury Inquiry Completed in the Fiscal Year

As illustrated in the above table, the Tribunal completed one final injury inquiry in the fiscal year. Two final injury inquiries were still in progress at the end of the fiscal year. The completed inquiry concerned steel grating. The following summary was prepared for general information purposes only and is of no legal effect.

NQ-2010-002—Steel Grating

The Tribunal sent detailed questionnaires to 2 known domestic producers, 63 of the largest importers, 25 purchasers of steel grating and 61 potential foreign producers and exporters of the subject goods. It also sent questionnaires on classes of goods to 2 producers, 3 importers and 16 purchasers. Of the 172 questionnaires sent, 83 responses were used in the Tribunal's analysis. There was 1 participant in the inquiry, with 7 witnesses appearing before the Tribunal during 4 days of public hearing. The official record consisted of 637 exhibits, totalling 10,000 pages of documents.

The Tribunal first determined that domestically produced steel grating constituted like goods in relation to the subject goods. The Tribunal then concluded that there were two classes of goods, carbon and alloy steel bar grating and stainless steel bar grating. In a separate opinion on classes of goods, Member Fréchette concluded that there were three classes of goods: galvanized carbon and alloy steel grating, non-galvanized carbon and alloy steel grating, and stainless steel grating. The Tribunal terminated its inquiry in respect of stainless steel grating, due to the negligible volume of imports. Finally, the Tribunal determined that Fisher & Ludlow Ltd. (Fisher & Ludlow) and Borden Metal Products (Canada) Limited constituted the domestic industry. However, since Fisher & Ludlow alone constituted a major proportion of the total domestic production of the like goods, the Tribunal decided to restrict its analysis of injury to the evidence pertaining to Fisher & Ludlow's production.

The Tribunal was of the view that there was a significant increase in the volume of imports of the subject goods in absolute terms, and relative to the production and consumption of like goods. The Tribunal found that the subject goods had significantly undercut, depressed and suppressed the price of the like goods. The Tribunal also found that the prevalence of the subject goods in the Canadian market, especially in 2008 and 2009, had a significant negative impact on Fisher & Ludlow's production and capacity utilization rates. In addition, the Tribunal found that the dumping and subsidizing of the subject goods resulted in lost sales and market share for the domestic industry, negatively impacted the financial performance of the domestic industry in 2009 and interim 2010, caused declines in employment and productivity, and resulted in negative effects on return on investment and other indicators.

With respect to the accumulative losses suffered by the domestic steel grating industry that are attributable to the recession, the Tribunal concluded that the dumping and subsidizing of the subject goods had, in and of themselves, caused material injury.

Final Injury Inquiries in Progress at the End of the Fiscal Year

As already mentioned, there were two final injury inquiries in progress at the end of the fiscal year, Pup Joints (NQ-2011-001) and Stainless Steel Sinks (NQ-2011-002), both of which concern dumped and subsidized imports from China.

Public Interest Inquiries Under Section 45 of SIMA

Following a finding of injury, the Tribunal notifies all interested parties that any submissions requesting a public interest inquiry must be filed within 45 days. It may initiate, either after a request from an interested person or on its own initiative, a public interest inquiry following a finding of injury caused by dumped or subsidized imports, if it is of the opinion that there are reasonable grounds to consider that the imposition of all or part of the duties may not be in the public interest. If it is of this view, the Tribunal then conducts a public interest inquiry pursuant to section 45 of SIMA. The result of this inquiry may be a report to the Minister of Finance recommending that the duties be reduced and by how much.

There were no requests for a public interest inquiry during the fiscal year.

Interim Reviews

The Tribunal may review its findings of injury or orders at any time, on its own initiative or at the request of the Minister of Finance, the CBSA or any other person or government (section 76.01 of SIMA). The Tribunal commences an interim review where one is warranted and it then determines if the finding or order (or any aspect of it) should be rescinded or continued to its expiry date, with or without amendment.

An interim review may be warranted where there is a reasonable indication that new facts have arisen or that there has been a change in the circumstances that led to the finding or order. For example, since the finding or order, the domestic industry may have ceased production of like goods or foreign subsidies may have been terminated. An interim review may also be warranted where there are facts that, although in existence, were not put into evidence during the previous review or inquiry and were not discoverable by the exercise of reasonable diligence at the time.

Interim Review Activities

Request for interim review No./Interim review No. RD-2011-001 and RD-2011-003 (interim reviews) RD-2011-002 (request for interim review) RD-2011-004 (interim review) RD-2011-005 RD-2011-006
Product Aluminum extrusions Aluminum extrusions Mattress innerspring units Aluminum extrusions Aluminum extrusions
Type of case/country Dumping and subsidizing/China Dumping and subsidizing/China Dumping/China Dumping and subsidizing/China Dumping and subsidizing/China
Date of order or of withdrawal In progress March 14, 2012 March 30, 2012 In progress In progress
Order   No review Finding continued    
Participants   1 5    
Exhibits   16 29    
Pages of official record   150 90    

Requests for Interim Reviews and Interim Reviews Completed in the Fiscal Year

As can be seen from the above table, the Tribunal received six requests for interim reviews, four of which were still in progress at the end of this fiscal year.

In Request for Interim Review No. RD-2011-002, the Tribunal determined that an interim review was not warranted. In Interim Review No. RD-2011-004, the Tribunal continued its finding without amendment.

Expiries

Subsection 76.03(1) of SIMA provides that a finding or order expires after five years, unless an expiry review has been initiated. Not later than 10 months before the expiry date of the order or finding, the Secretary of the Tribunal publishes a notice of expiry in the Canada Gazette. The notice invites persons and governments to submit their views on whether the order or finding should be reviewed and gives direction on the issues that should be addressed in the submissions. If the Tribunal determines that an expiry review is not warranted, it issues an order with reasons for its decision. Otherwise, it initiates an expiry review.

Expiry Activities

Expiry No. LE-2011-001 LE-2011-002 LE-2011-003
Product Copper pipe fittings Bicycles Hot-rolled carbon steel plate
Type of case/country Dumping/United States, Korea and China
Subsidizing/China
Dumping/Chinese Taipei and China Dumping/China
Date of order or notice of expiry review June 1, 2011 March 28, 2012 In progress
Decision Expiry review initiated Expiry review initiated  
Participants 4 14  
Pages of official record 450 200  

As illustrated in the above table, the Tribunal decided to commence two expiry reviews in the fiscal year.

On the basis of submissions from interested parties, the Tribunal was of the view that expiry reviews were warranted and initiated Expiry Review No. RR-2011-001 respecting copper pipe fittings and Expiry Review No. RR-2011-002 respecting bicycles.

At the end of the fiscal year, consideration of Expiry No. LE-2011-003 respecting hot-rolled carbon steel plate was in progress.

Expiry Reviews

When the Tribunal initiates a review of a finding or an order, it issues a notice of expiry review and notifies the CBSA of its decision. The notice of expiry review is published in the Canada Gazette and forwarded to all known interested parties.

The purpose of an expiry review is to determine whether anti-dumping or countervailing duties remain necessary. There are two phases in an expiry review. The first phase is the investigation by the CBSA to determine whether there is a likelihood of resumed or continued dumping or subsidizing if the finding or order expires. If the CBSA determines that such likelihood exists with respect to any of the goods, the second phase is the Tribunal's inquiry into the likelihood of injury or retardation. If the CBSA determines that there is no likelihood of resumed dumping or subsidizing for any of the goods, the Tribunal does not consider those goods in its subsequent determination of the likelihood of injury and issues an order rescinding the order or finding with respect to those goods.

The Tribunal's procedures in expiry reviews are similar to those in final injury inquiries.

Upon completion of an expiry review, the Tribunal issues an order with reasons, rescinding or continuing a finding or order, with or without amendment. If a finding or order is continued, it remains in force for a further five years, unless an interim review is initiated and the finding or order is rescinded. If the finding or order is rescinded, imports are no longer subject to anti-dumping or countervailing duties.

Expiry Review Activities

Expiry Review No. RR-2010-001 RR-2011-001 RR-2011-002
Product Flat hot-rolled carbon and alloy steel sheet and strip Copper Pipe Fittings Bicycles
Type of case/country Dumping/Brazil, China, Chinese Taipei, India, South Africa and Ukraine
Subsidizing/India
Dumping/United States, Korea and China
Subsidizing/China
Dumping/Chinese Taipei and China
Date of order August 15, 2011 February 17, 2012 In progress
Order Order continued for Brazil, China, Chinese Taipei, India and Ukraine
Order rescinded for South Africa
Findings continued  
Questionnaires sent1 183 68  
Questionnaires received2 44 22  
Participants 5 4  
Exhibits 463 327  
Pages of official record 21,500 15,670  
Public hearing days 5 2  
Witnesses 14 5  
1. Expiry review questionnaires are sent to a comprehensive list of known domestic producers and to all potential importers and exporters, and are for use by the CBSA and the Tribunal.
2. As in the case of final injury inquiries, the Tribunal focuses its questionnaire response follow-up on all known domestic producers and the largest importers, which generally account for 80 percent or more of the subject imports during the period of review.

Expiry Reviews Completed in the Fiscal Year

As illustrated in the above table, during the fiscal year, the Tribunal completed two expiry reviews.

RR-2010-001—Flat Hot-rolled Carbon and Alloy Steel Sheet and Strip

This expiry review concerned the dumping of flat hot-rolled carbon and alloy steel sheet and strip originating in or exported from Brazil, China, Chinese Taipei, India, South Africa and Ukraine, and the subsidizing of flat hot-rolled carbon and alloy steel sheet and strip from India.

The Tribunal sent detailed questionnaires to the 4 known domestic producers, 114 of the largest importers and 65 foreign producers and exporters of the subject goods in the named countries. Of the 183 questionnaires sent, 44 responses were used in the Tribunal's analysis. There were 5 participants in the expiry review, with 14 witnesses appearing before the Tribunal during 5 days of public hearing. The official record consisted of 463 exhibits, totalling 21,500 pages of documents.

On August 15, 2011, the Tribunal continued its order in respect of flat hot-rolled carbon and alloy steel sheet and strip from Brazil, China, Chinese Taipei, India and Ukraine and rescinded its order in respect of flat hot-rolled carbon and alloy steel sheet and strip from South Africa.

RR-2011-001—Copper Pipe Fittings

This expiry review concerned the dumping of copper pipe fittings from the United States, Korea and China, and the subsidizing of copper pipe fittings from China.

The Tribunal sent 2 producers' questionnaires, 30 importers' questionnaires and 36 foreign producers' questionnaires to foreign producers and exporters of the subject goods in the named countries. Of the 68 questionnaires sent, 22 completed questionnaires were used in the Tribunal's analysis. There were 7 participants in the expiry review; however, 3 parties withdrew their participation prior to the hearing. No parties appeared before the Tribunal or provided submissions in opposition to the continuation of the findings. Five witnesses for the domestic industry appeared before the Tribunal during 2 days of public hearing. The official record consisted of 327 exhibits, totalling 15,670 pages of documents.

On February 17, 2012, the Tribunal continued its findings in respect of copper pipe fittings from the United States, Korea and China.

Expiry Reviews in Progress at the End of the Fiscal Year

There was one expiry review in progress at the end of the fiscal year respecting bicycles.

RR-2011-002—Bicycles

This is an expiry review of the Tribunal's order made on December 10, 2007, in Expiry Review No. RR-2006-001, continuing, with amendment, its order made on December 9, 2002, in Expiry Review No. RR-2002-001, continuing, with amendment, its order made on December 10, 1997, in Review No. RR-97-003, continuing, with amendment, its finding made on December 11, 1992, in Inquiry No. NQ-92-002, concerning the dumping of bicycles originating in or exported from Chinese Taipei and China.

Judicial or Panel Reviews of SIMA Decisions

The following table lists Tribunal decisions that were before the Federal Court of Appeal under section 76 of SIMA in the fiscal year.

Summary of Judicial or Panel Reviews

Case No. Product Country of Origin Court File No./Status
RR-2009-003 Refined sugar United States, Denmark, Germany, Netherlands, United Kingdom and European Union A—461—10
Note: The Tribunal has made reasonable efforts to ensure that the information listed is complete. However, since the Tribunal does not ordinarily participate in appeals to the Federal Court of Appeal or the Federal Court, it is unable to confirm that the list contains all appeals or decisions rendered that were before the Federal Court of Appeal and the Federal Court.

WTO Dispute Resolutions

There were no Tribunal findings or orders before the WTO Dispute Settlement Body during the fiscal year.

SIMA Findings and Orders in Force as of March 31, 2012

During calendar year 2011, there were 19 SIMA findings and orders in force, affecting approximately 0.28 percent of Canadian imports, 2.44 percent of Canadian shipments and 0.96 percent of Canadian employment.

Summary of Findings and Orders in Force

Review No. or Inquiry No. Date of Decision Product Type of Case/Country Related Decision No. and Date
NQ-2007-001 March 10, 2008 Seamless carbon or alloy steel oil and gas well casing Dumping and subsidizing/China  
NQ-2008-001 August 20, 2008 Carbon steel welded pipe Dumping and subsidizing/China  
NQ-2008-002 December 11, 2008 Thermoelectric containers Dumping and subsidizing/China  
NQ-2008-003 March 17, 2009 Aluminum extrusions Dumping and subsidizing/China  
NQ-2009-002 November 24, 2009 Mattress innerspring units Dumping/China  
NQ-2009-003 February 2, 2010 Hot-rolled carbon steel plate and high-strength low-alloy plate Dumping/Ukraine  
NQ-2009-004 March 23, 2010 Oil country tubular goods Dumping and subsidizing/China  
NQ-2010-001 October 9, 2010 Greenhouse bell peppers Dumping/Netherlands  
NQ-2010-002 April 19, 2011 Steel grating Dumping and subsidizing/China  
RR-2006-001 December 10, 2007 Bicycles Dumping/Chinese Taipei and China RR-2002-001
(December 9, 2002)
RR-97-003
(December 10, 1997)
NQ-92-002
(December 11, 1992)
RR-2007-001 January 9, 2008 Hot-rolled carbon steel plate Dumping/China RR-2001-006
(January 10, 2003)
NQ-97-001
(October 27, 1997)
RR-2007-003 July 15, 2008 Carbon steel pipe nipples and adaptor fittings Dumping/China RD-2006-006
(June 8, 2007)
NQ-2002-004
(July 16, 2003)
RR-2008-001 December 22, 2008 Structural tubing Dumping/Korea, South Africa and Turkey NQ-2003-001
(December 23, 2003)
RR-2008-002 January 8, 2009 Hot-rolled carbon steel plate and high-strength low-alloy steel plate Dumping/Bulgaria, Czech Republic and Romania NQ-2003-002
(January 9, 2004)
RR-2009-001 January 6, 2010 Carbon steel fasteners Dumping/China and Chinese Taipei
Subsidizing/China
NQ-2004-005
(January 7, 2005)
RR-2009-002 September 10, 2010 Whole potatoes Dumping/United States RR-2004-006
(September 12, 2005)
RR-99-005
(September 13, 2000)
RR-94-007
(September 14, 1995)
RR-89-010
(September 14, 1990)
CIT-16-85
(April 18, 1986)
ADT-4-84
(June 4, 1984)
RR-2009-003 November 1, 2010 Refined sugar Dumping/United States RR-2004-007
(November 2, 2005)
RR-99-006
(November 3, 2000)
NQ-95-002
(November 6, 1995)
RR-2010-001 August 15, 2011 Flat hot-rolled carbon and alloy steel sheet and strip Dumping/Brazil, China, Chinese Taipei, India and Ukraine
Subsidizing/India
NQ-2001-001
(August 17, 2001)
RR-2005-002
August 16, 2006
RR-2011-001 February 17, 2012 Copper pipe fittings Dumping/United States, Korea and China
Subsidizing/China
NQ-2006-002
(February 19, 2007)
Note: For complete product descriptions, refer to the most recent finding or order available at www.citt-tcce.gc.ca.