Customs Tariff (Identification and Assessment of
Safeguard Duty) Rules, 1997
[Notification No. 35/97-Cus. (N.T.),
dated 29-7-1997.]
In exercise of the powers conferred by
sub-section (5) of section 8B of the Customs Tariff Act, 1975 (51
of 1975) the Central Government hereby makes the following rules,
namely :-
1. Short title and
commencement.- (i) These rules may be called the Customs Tariff
(Identification and Assessment of Safeguard Duty) Rules, 1997.
(ii) They shall come into force
on the date of their publication in the Official gazette.
2. Definitions. -In these rules, unless
the context otherwise requires, -
(a) "Act" means the
Customs Tariff Act, 1975 (51 of 1975);
(b) "Critical
circumstances" means circumstances in which there is clear
evidence that imports have taken place in such increased
quantities and under such circumstances as to cause or threaten
to cause serious injury to the domestic industry and delay in
imposition of provisional safe- guard duty would cause
irreparable damage to the domestic industry;
(c) "increased quantity" includes
increase in imports whether in absolute terms or relative to
domestic production;
(d) "Interested Party" includes -
(i) any exporter or foreign producer or
the importer of an article subjected to investigation for
purposes of imposition of safeguard duty or a trade or business
association, majority of the members of which are producers,
exporter or importers of such an article;
(ii) the government of the exporting
country; and
(iii) a producer of the like article or
directly competitive article in India or a trade or business
association, a majority of members of which produce or trade the
like article or directly competitive article in India;
(e) "like article" means an article
which is identical or alike in all respects to the article under
investigation;
(f) "Provisional Duty" means a
safeguard duty imposed under sub-section (2) of section 8B of the
Act;
(g) "Specified Country" means a country
or territory which is a member of the World Trade Organisation
and includes the country or territory with which the Government
of India has an agreement for giving it the most favoured nation
treatment;
(h) all words and expressions used and
not defined in these rules shall have the meanings respectively
assigned to them in the Act.
3. Appointment of
Director General (Safeguard).- (1) The Central Government may,
by notification in the official Gazette appoint an officer not
below the rank of a Joint Secretary to the Government of India or
such other officer as it may think fit as the Director General
(Safeguard) hereinafter referred to as the Director General for
the purposes of these rules.
(2) The Central Government may
provide to the Director General the services of such other
persons and such other facilities at it deems fit.
4. Duties of the Director General.-Subject to the provisions of these rules, it shall be the duty
of the Director General -
(1) to investigate
the existence of "serious injury" or "threat of serious injury"
to domestic industry as a consequence of increased import of an
article into India;
(2) to identify the
article liable for safeguard duty;
(3) to submit his
findings, provisional or otherwise to the Central Government as
to the "serious injury" or "threat of serious injury" to domestic
industry consequent upon increased import of an article from the
specified country;
(4) to recommend, -
(i) the amount of duty which if levied
would be adequate to remove the injury or threat of injury to the
domestic industry;
(ii) the duration of levy of safeguard
duty and where the period so recommended is more than a year, to
recommend progressive liberalisation adequate to facilitate
positive adjustment.
(5) to review the
need for continuance of safeguard duty.
5. Initiation of
Investigation. - (1) Except as provided in sub-rule (4) the
Director General shall, on receipt of a written application by or
on behalf of the domestic producer of like article or directly
competitive article, initiate an investigation to determine the
existence of "serious injury" or "threat of serious injury" to
the domestic industry, caused by the import of an article in such
increased quantities, absolute or relative to domestic
production.
(2) An application under sub-rule
(1) shall be in the form as may be specified by the Director
General in this behalf and such application shall be supported
by, -
(a) evidence of, -
(i) increased imports;
(ii) serious injury or threat of
serious injury to the domestic industry;
(iii) a causal link between imports and
the alleged serious injury or threat of serious injury; and
(b) a statement on the efforts being
taken, or planned to be taken, or both, to make a positive
adjustment to import competition.
(3) The Director General shall
not initiate an investigation pursuant to an application made
under sub-rule (1) unless he examines the accuracy and adequacy
of the evidence provided in the application and satisfies himself
that there is sufficient evidence regarding -
(a) increased imports;
(b) serious injury or threat of serious
injury; and
(c) a causal link between increased
imports and alleged injury or threat of serious injury.
(4) Notwithstanding anything contained in sub-rule (1), the
Director General may initiate an investigation suo motu
if he is satisfied with the information received from any
Commissioner of Customs appointed under the Customs Act, 1962 (52
of 1962) or any other source that sufficient evidence exists as
referred to in clause (a), clause (b) and clause (c) of sub-rule
(3).
6. Principles Governing
Investigations. - (1) The Director General shall, after he has
decided to initiate investigation to determine the serious injury
or threat of serious injury to domestic industry, consequent upon
the increased import of an article into India, issue a public
notice notifying his decision thereto. The public notice shall inter
alia, contain adequate information on the following, namely :-
(i) the name of the exporting countries
and the article involved;
(ii) the date of initiation of the
investigation;
(iii) a summary statement of the facts
on which the allegation of serious injury or threat of serious
injury is based;
(iv) reasons for initiation of
investigation.
(v) the address to which
representations by interested parties should be directed; and
(vi) the time-limits allowed to
interested parties for making their views known.
(2) A copy of the public notice
shall be forwarded by the Director General to the Central
Government in the Ministry of Commerce and other Ministries
concerned, known exporters of the article the increased import of
which has been alleged to cause or threaten to cause serious
injury to the domestic industry, the governments of the exporting
countries concerned and other interested parties.
(3) The Director General shall
also provide a copy of the application referred to in sub-rule
(1) of rule 5 to -
(i) the known
exporters, or the concerned trade association;
(ii) the governments
of the exporting countries; and
(iii) the Central
Government in the Ministry of Commerce;
Provided that the Director General shall also
make available a copy of the application, upon request in
writing, to any other interested party.
(4) The Director General may
issue a notice calling for any information in such form as may be
specified by him from the exporters, foreign producers and
governments of interested countries and such information shall be
furnished by such persons and governments in writing within
thirty days from the date of receipt of the notice or within such
extended period as the Director General may allow on sufficient
cause being shown.
Explanation. - For the purpose of this rule the public
notice and other documents shall be deemed to have been received
one week after the date on which these documents were sent by the
Director General by registered post or transmitted to the
appropriate diplomatic representative of the exporting country.
(5) The Director General shall
also provide opportunity to the industrial user of the article
under investigation, and to representative consumer organisations
in cases where the article is commonly sold at retail level to
furnish information which is relevant to the investigation.
(6) The Director General may
allow an interested party or its representative to present the
information relevant to investigation orally but such oral
information shall be taken into consideration by the Director
General only when it is subsequently submitted in writing.
(7) The Director General shall
make available the evidence presented to him by one interested
party to the other interested parties, participating in the
investigation.
(8) In case where an interested
party refuses access to or otherwise does not provide necessary
information within a reasonable period or significantly impedes
the investigation, the Director General may record his findings
on the basis of the facts available to him and make such
recommendations to the Central Government as he deems fit under
such circumstances.
7. Confidential
information. - (1) Notwithstanding anything contained in
sub-rules (1), (3) and (7) of rule 6, sub-rule (2) of rule
9 and sub-rule (5) of rule 11, any information which is by nature
confidential or which is provided on a confidential basis shall,
upon cause being shown, be treated as such by the Director
General and shall not be disclosed without specific authorisation
of the party providing such information.
(2) The Director General may
require the parties providing information on confidential basis
to furnish non-confidential summary thereof and if, in the
opinion of the party providing such information, such information
cannot be summarised, such party may submit to the Director
General a statement of reasons why summarisation is not possible.
(3) Notwithstanding anything
contained in sub-rule (2), if the Director General is satisfied
that the request for confidentiality is not warranted or the
supplier of the information is unwilling either to make the
information public or to authorise its disclosure in a
generalised or summary form, he may disregard such information
unless it is demonstrated to his satisfaction from appropriate
sources that such information is correct.
8. Determination of
serious injury or threat of serious injury. - The Director
General shall determine serious injury or threat of serious
injury to the domestic industry taking into account, inter
alia, the principles laid down in Annex to these rules.
9. Preliminary findings.
- (1) The Director General shall proceed expeditiously with the
conduct of the investigation and in critical circumstances, he
may record a preliminary findings regarding serious injury or
threat of serious injury.
(2) The Director General shall
issue a public notice regarding his preliminary findings.
(3) The Director General shall
send a copy of the public notice to the Central Government in the
Ministry of Commerce and in the Ministry of Finance.
10. Levy of provisional duty. -
The Central Government may in accordance with the provisions of
sub-section (2) of section 8B of the Act, impose a provisional
duty on the basis of the preliminary findings of the Director
General :
Provided that such duty shall remain in
force only for a period not exceeding two hundred days from the
date on which it was imposed.
11. Final findings. -
(1) The Director General shall, within 8 months from the date of
initiation of the investigation or within such extended period as
the Central Government may allow, determine whether, -
(a) the increased
imports of the article under investigation has caused or
threatened to cause serious injury to the domestic industry, and
(b) a causal link
exists between the increased imports and serious injury or threat
of serious injury.
(2) The Director General shall
also give its recommendation regarding amount of duty which, if
levied, would be adequate to prevent or remedy serious injury and
to facilitate positive adjustment.
(3) The Director General shall
also make his recommendations regarding the duration of levy of
duty :
Provided that where the period
recommended is more than one year, the Director General shall
also recommend progressive liberalisation adequate to facilitate
positive adjustment.
(4) The final findings if
affirmative, shall contain all information on the matter of facts
and law and reasons which have led to the conclusion.
(5) The Director General shall
issue a public notice recording his final findings.
(6) The Director General shall
send a copy of the public notice regarding his final findings to
the Central Government in the Ministry of Commerce and in the
Ministry of Finance.
12. Levy of duty. - (1)
The Central Government may, impose by a notification in the
Official Gazette, upon importation into India of the product
covered under the final finding, a safeguard duty not exceeding
the amount which has been found adequate to prevent or remedy
serious injury and to facilitate positive adjustment.
(2) If the final finding of the Director General is
negative, that is contrary to the prima facie evidence on
whose basis the investigation was initiated, the Central
Government shall within thirty days of the publication of final
findings by the Director General under rule 11, withdraw the
provisional duty imposed, if any.
13. Imposition of duty
on non-discriminatory basis. - Any safeguard duty imposed under
rule 10 or rule 12 shall be on a non-discriminatory basis and
applicable to all imports of such article, irrespective of its
source.
14. Date of commencement of duty.
- (1) The Safeguard duty levied under rule 10 or rule 12 shall
take effect from the date of publication of the notification, in
the Official Gazette imposing such duty.
(2) Notwithstanding anything
contained in sub-rule (1), where a provisional duty has been
levied and where the Director General has recorded a finding that
increased imports have caused or threaten to cause serious injury
to domestic industry, it shall be specified in the notification
under sub-rule (1) that such safeguard duty shall take effect
from the date of levy of provisional duty.
15. Refund of duty. - If
the safeguard duty imposed after the conclusions of the
investigation is lower than the provisional duty already imposed
and collected, the differential shall be refunded to the
importer.
16. Duration. - (1) The
duty levied under rule 12 shall be only for such period of time
as may be necessary to prevent or remedy serious injury and to
facilitate positive adjustment.
(2) Notwithstanding anything
contained in sub-rule (1) of this rule duty levied under rule 12
shall, unless revoked earlier, cease to have effect on the expiry
of four years from the date of its imposition :
Provided that if the Central Government
is of the opinion that the domestic industry has taken measures
to adjust to such injury or threat thereof and it is necessary
that the safeguard duty should continue to be imposed, it may
extend the period of such imposition :
Provided further that in no case the
safeguard duty shall continue to be imposed beyond a period of
ten years from the date on which such duty was first imposed.
17. Liberalization of
duty. - If the duration of the duty levied under rule 12 exceeds
one year, the duty shall be progressively liberalized at regular
intervals during the period of its imposition.
18. Review. - (1) The
Director General shall, from time to time, review the need for
continued imposition of the safeguard duty and shall, if he is
satisfied on the basis of information received to him that, -
(i) safeguard duty is necessary to
prevent or remedy serious injury and there is evidence that the
industry is adjusting positively, it may recommend to the Central
Government for the continued imposition of duty;
(ii) there is no justification for the
continued imposition of such duty, recommend to the Central
Government for its withdrawal :
Provided that where the period of
imposition of safeguard duty exceeds three years the Director
General shall review the situation not later than the mid-term of
such imposition, and, if appropriate, recommend for withdrawal of
such safeguard duty or for the increase of the liberalisation of
duty.
(2) Any review initiated under
sub-rule (1) shall be concluded within a period not exceeding 8
months from the date of initiation of such review or within such
extended period as the Central Government may allow.
(3) The provisions of rules 5, 6, 7 and 11 shall
mutatis mutandis apply in the case of review.
ANNEXURE
( See Rule 8 )
(1) In the investigation to
determine whether increased imports have caused or are
threatening to cause serious injury to a domestic industry, the
Director General shall evaluate all relevant factors of an
objective and quantifiable nature having a bearing on the
situation of that industry, in particular, the rate and amount of
the increase in imports of the article concerned in absolute and
relative terms, the share of the domestic market taken by
increased imports, changes in the level of sales, production,
productivity, capacity utilization, profits and losses, and
employment.
(2) The determination referred to
in paragraph (1) shall not be made unless the investigation
demonstrates, on the basis of objective evidence, the existence
of the causal link between increased imports of the article
concerned and serious injury or threat thereof. When factors
other than increased imports are causing injury to the domestic
industry at the same time, such injury shall not be attributed to
increased imports. In such a cases, the Director General may
refer the complaint to the authority for anti-dumping or
countervailing duty investigations, as appropriate.
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