ITAC has terminated the safeguard investigation into structural steel products (U, I, H, L, and T sections of iron or non-alloy steel). This comes 15 months after ITAC initiated the investigation. The applicant had requested a safeguard duty of 120%.
In reaching the final decision, the Commission considered the following:
- the trends in imports over the period of investigation hence the finding that the surge in imports took place in the 2014/2015 financial year. The Applicant ceased production of the subject product in 2015. There was no domestic production of the subject product after the Applicant ceased to manufacture in 2015, until March 2017. Imports increased when there was no domestic production. When the Applicant resumed production and sales of the subject product in April 2017, imports declined significantly.
- the imports continued to decrease in the last three years of the investigation period i.e. 2017, 2018 and 2019 and that a reversal of the increase has taken place. In view of this, the Commission found that the alleged surge in imports does not meet the requirements set out by the WTO Safeguards Agreement and the SGR.
- although the SACU industry experienced serious injury during the period of investigation, the injury experienced by the Applicant can be attributed to factors other than the increase in imports and these factors sufficiently detract from the causal link between the imports and the injury experienced by the industry.
- since the Applicant resumed production of the subject product in 2017 imports decreased dramatically and the Applicant’s injury indicators showed a significant improvement. In 2019, imports continued to decrease, whilst the Applicant’s performance decreased as well, as can be seen from the decrease in the Applicant’s production, sales and capacity utilisation. The Commission is however, of the view that it would be difficult to suggest that imports are the cause of the serious injury experienced by the Applicant, as there was injury even though imports continued to decrease. The Commission noted that the size of the market decreased in 2019, which could also be contributing to the injury experienced by the Applicant.
What is a lot less clear is why this investigation was ever initiated, given the paucity to evidence that imports were surging, causing serious injury to the local producer.
But, finally this long battle has been resolved and XA is proud to have advised the companies that made this happen!
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