TABLE OF CONTENTS.no.ParticularsPage no.

1. List of Abbreviations used2

2. Introduction 3

3. Dumping4

4. Anti-dumping 4

5. Difference between Normal Custom duty and Anti-Dumping duty4

6. The legal framework for Anti-dumping measures in India5

7. Justifications for antidumping duty5

8. WTO and Anti-Dumping Agreement6

9. Competition Law in India6

10. Conflict between anti-dumping law and competition law8

11. Overlaps9

12. Antidumping and Competition Provisions in Free Trade Agreements/Regional Trade Agreements12

13. Conclusion 12

14. References 14

List of Abbreviations usedAbbreviationFull Form

GATTGeneral Agreement on Trade and Tariff

WTOWorld Trade Organization

MRTPMonopolies and Restrictive Trade Practices

CCICompetition Commission of India

DGADDirectorate General of Anti-Dumping and Allied Duties

FTAFree Trade Agreement

1. Introduction

The dumping subjects are one of the hottest topics in the international trade scene because of its multitude possible approaches and actors who are involved. Dumping occurs when a foreign producer sells a product in a country at a price that is below that producer's sales price in the home market, or at a price that is lower than the cost of production. This is an unfair trade practice which can have a distortive effect on international trade as it keeps competitors out of a particular market. Dumping can only occur at places where imperfect competition and where the markets are segmented in a way such that domestic residents cannot easily purchase goods intended for export[footnoteRef:1]. Dumping can be defined in various ways, but most generally accepted approach is: price discrimination between national markets[footnoteRef:2] as defined by Jacob Viner. According to Viner, anti-dumping can lead to a predatory dumping which is to sell products in foreign market lower than the home market price, then that company would push its competitors in the foreign market. Consequently, it can raise the price abnormally high and set monopoly to make its loss. Anti-dumping measures rectify the situation arising out of the dumping of goods and its trade distortive effect. It is essentially a mechanism of defence provided for under Article VI of GATT 1994 which allows all member countries to apply anti-dumping measures wherever warranted for protecting their domestic industry from unfair Competition. India is availing of this facility like all other member countries of the WTO. Anti-dumping duty is recognized as an instrument for ensuring fair trade and is not a measure of protection per se for the domestic industry. It provides relief to the domestic industry against the injury caused by dumping. Anti-dumping has acquired a special significance primarily as a means of checking unfair trade practices and promoting fair competition. It is a subtle measure of protection which comes under the non-tariff barriers and is product and source specific. Antidumping duties were initiated with the intention of nullifying the effect of the market distortions created due to unfair trade practices adopted by aggressive exports. They are meant to be remedial and not punitive in nature. A harmful to the domestic producers as their products are unable to compete with the artificially low prices imposed by the imported goods. As a method of protection to the domestic industries, anti-dumping duties are thus levied on the exporting country which has been accused of dumping goods in another country. The analysis of the objectives of the two sets of laws as expressly stated in the legislations in India reveals that prevention of unfair business practices is common interface between the two. While competition laws are primarily aimed at protecting and promoting competition in markets, antidumping laws are aimed at remedying the injury to the domestic industry which may arise due to dumping, which in essence amounts to protection of competitors. The analysis of the objectives of the two sets of laws as expressly stated in the legislations in the subject countries reveals that prevention of unfair business practices is common interface between the two. While competition laws are primarily aimed at protecting and promoting competition in markets, antidumping laws are aimed at remedying the injury to the domestic industry which may arise due to dumping, which in essence amounts to protection of competitors [1: Alexandru Moldovan, Antidumping and trade diversion in the United States of America (2013)] [2: Jacov Viner, Dumping: A problem in International Trade (1923)]

2. DumpingOften, dumping is mistaken and simplified to mean cheap or low priced imports. However, it is a misunderstanding of the term. Dumping, in its legal sense, means export of goods by a country to another country at a price lower than its normal value. Thus, dumping implies low priced imports only in the relative sense (relative to the normal value), and not in absolute sense. In simple parlance, the normal value is the selling price of the product in the exporting country. Import of undervalued products to evade customs duty or through illegal trade channels like smuggling does not fall within the purview of anti-dumping measures.

3. Anti-dumping Dumping is said to have taken place when an exporter sells a product at a price less than the price prevailing in its domestic market. However, the phenomenon of dumping is per se notCondemnable as it is recognized that producers sell their goods at different prices to different market. It is also not unusual for prices to vary from time to time in the light of supply and demand conditions. It is also recognized that price discrimination in the form of the dumping is a common international commercial practice. It is also not uncommon that the export prices are lower than the domestic prices. Therefore, from the point of view of anti-dumping practices, there is nothing inherently illegal or immoral about the practice of dumping. However, where dumping causes or threatens to cause material injury to the domestic industry of India, the Designated Authority initiates necessary action for investigations and subsequent imposition of anti-dumping duties.

4. Difference between Normal Custom duty and Anti-Dumping dutyAlthough anti-dumping duty is levied and collected by the Customs Authorities, it is entirely different from the Customs duties not only in concept and substance, but also in purpose and operation. The following are the main differences between the two: - Conceptually, anti-dumping and the like measures in their essence are linked to the notion of fair trade. The object of these duties is to guard against the situation arising out of unfair trade practices while customs duties are levied as a means of raising revenue and for overall development of the economy. Customs duties fall in the realm of trade and fiscal policies of the Government while anti-dumping measures are trade remedial measures. The object of anti-dumping is to offset the injurious effect of international price discrimination while customs duties have implications for the government revenue and for overall development of the economy. Anti-dumping duties are not necessarily in the nature of a tax measure in as much as the Authority is empowered to suspend these duties in case of an exporter offering a price undertaking. Thus such measures are not always in the form of duties/tax. Anti-dumping duties are levied against exporter / country in as much as they are country specific and exporter specific as against the customs duties which are general and universally applicable to all imports irrespective of the country of origin and the exporter.5. The legal framework for Anti-dumping measures in IndiaSections 9A, 9B and 9C of the Customs Tariff Act, 1975 as amended in 1995 and the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, framed there under form the legal basis for antidumping investigations and for the levy of anti-dumping duties in India. The Directorate General of Anti-Dumping and Allied Duties (DGAD) in the Ministry of Commerce and Industry (Department of Commerce) is responsible for Anti-Dumping and Countervailing Duty actions in India in consonance with WTO and the National Law. DGAD initiates investigations on the basis of prima-facie evidence of dumping, injury and causal link thereof. The domestic industry has to make available a fully documented petition before the case can be taken on record. During such documentation, the Officers in the Directorate assist the domestic industry. After initiation of investigation, the Designated Authority is required to follow specified procedures to give a fair opportunity to all the interested parties domestic as well as foreign to defend their cases. Besides examination of voluminous trade data, the price trends, normal values, product analysis etc., the Investigating Officers are required to carry out detailed verifications to analyse cost in the domestic industry, as well as prices indicated by exporters in the exporting countries. The findings-provisional as well as final-are required to be supported by sufficient evidence and cogent financial analysis. DGAD is endeavoring that preliminary findings are recommended after the completion of 60 days from the initiation of investigation. Final findings are to be given within 12 months of initiation of the case. After completion of investigations, DGAD recommends Preliminary findings/Final findings to Department of Revenue, Ministry of Finance, which notifies the imposition of Anti-Dumping Duty. The law provides that an order of determination of existence, degree and effect of dumping is appealable before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). However, as per the judicial view, only the final findings/order of the Designated Authority/Ministry of Finance can be appealed against before the CESTAT. No appeal will lie against the Preliminary findings of the Authority and the provisional duty imposed on the basis thereof. The Appeal to the CESTAT should be filed within 90 days from the date of issue of the notification by the Central Government imposing anti-dumping duty.

6. Justifications for antidumping dutyIn free trade, firms are allowed to charge different rates in different markets. The result would be that firms would charge lower prices in foreign markets and higher prices in domestic markets, leading to material injury to the domestic producers. Had price discrimination taken place by a monopoly firm within one economy, the government would have intervened to stop consumer exploitation by enforcing an Act similar to the MRTP Act, in India. Hence, in the international context, it is the anti-dumping duty that protects the domestic producers initially and consumers in the long run. The duty is justified because in case of many industries the startup period is long and start-up costs are also high. Once these firms are forced out of the market as a result of dumping by exporters, it is very difficult for them to restart when the same exporters raise prices. Usually, the intentions of charging such low prices to foreign consumers is to be able to wipe out the domestic industries and eventually acquiring monopoly power in the foreign market (i.e. using predatory pricing). Thus it is on this ground that the anti-dumping duties have been justified. The main intension is to protect the domestic industries.

7. WTO and Anti-Dumping AgreementThe Agreement on Implementation of Article VI of the General Agreement on Tariffs andTrade 1994 governs the application of antidumping measures by Members of the WTO. The provisions of the Agreement were first negotiated during the Kennedy Round (1967) and later substantially revised during the Tokyo Round (1979) of GATT negotiations. Anti-dumping measures are unilateral remedies which may be applied by a Member after an investigation and determination by that Member; in accordance with the provisions of the Agreement, that an imported product is dumped and that the dumped imports are causing material injury [footnoteRef:3] to a domestic industry producing the like product. The Agreement sets out rules for the conduct of anti-dumping investigations, including initiation of cases, calculation of dumping margins, the application of remedial measures, injury determinations, enforcement, reviews, duration of the measure and dispute settlement. The Agreement applies to trade in goods only. Trade in services is not covered by this agreement. The Agreement provides for the right of contracting parties to apply anti-dumping measures, i.e. measures against imports of a product at an export price below its normal value if such dumped imports cause injury to a domestic industry in the territory of the importing contracting party[footnoteRef:4]. In particular, the Agreement provides for greater clarity and more detailed rules in relation to the method of determining that a product is dumped, the criteria to be taken into account in a determination that dumped imports cause injury to a domestic industry, the procedures to be followed in initiating and conducting anti-dumping investigations[footnoteRef:5], and the implementation and duration of anti-dumping measures[footnoteRef:6]. In addition, the Agreement clarifies the role of dispute settlement panels in disputes relating to antidumping actions taken by domestic authorities. [3: Broadly, injury may be analysed in terms of the volume effect and price effect of the dumped imports. The volume effect of dumping relates to the market share of the domestic industry vis--vis the dumped importsfrom the subject country/ies while with regard to the price effect, the Designated Authority shall considerwhether there has been a significant price under cutting by the dumped imports as compared with the price of the like product in the domestic market, or whether the effect of such imports is otherwise to depress prices to a significant degree or prevent price increase which otherwise would have occurred to a significant degree.] [4: Article 3.5 of GATT] [5: Article 6 of GATT] [6: Article 11 of GATT]

8. Competition Law in IndiaIn India, competition Act, 2002 was enacted and implemented, with an objective of protection and promotion of competition in market and consumer welfare. The Indian Competition law contains an additional objective of competition advocacy which is not specifically stated in any other countrys competition legislation. The Competition Act, 2002 repealed the MRTP Act, 1969 and the focus was shifted from stopping the monopolistic practice to encouraging the competition in market.The Act provides a very wide mandate for the Competition Commission of India to enforce. Apart from it rather broad objective, the Act contains provisions which have rather become standard in the competition jurisdictions all across the globe. These are the provisions relating to anti-competitive agreements, abuse of dominant position and regulation of combinations. In the respect of anti-dumping law the provisions relating to abuse of dominant position and anti-competitive agreements assume importance. In respect of dominant position it is pertinent to note that whereas dominance is not frowned upon by the Competition Act, 2002 abuse of dominance is certainly frowned upon by the legislation. Another significant feature in the context of these provisions of the Act is that anti-competitive agreements and abuse of dominance are to be prohibited by the orders of the Commission whereas the mergers are to be regulated by the orders of the e of Commission. This difference in law is of immense significance. Whereas the former two prevent enhancement of consumer welfare the latter drives economic growth. Hence, the distinction has been maintained.

(i) Section 4 of Competition ActIn respect of abuse of dominant position, Section 4(2) enlists the circumstances when an enterprise shall be considered to be abusing its dominant position. It states:(2) There shall be an abuse of dominant position under sub-section (1), if an enterprise,-(a) directly or indirectly, imposes unfair or discriminatory-(i) condition in purchase or sale of goods or service; or(ii) price in purchase or sale (including predatory price) of goods or service; or (b) limits or restricts-(i) production of goods or provision of services or market therefor; or(ii) technical or scientific development relating to goods or services to the prejudice of consumers; or(c) indulges in practice or practices resulting in denial of market access; or(d) makes conclusion of contracts subject to acceptance by other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts; or(e) uses its dominant position in one relevant market to enter into, or protect, other relevant market.

(ii) Abuse of Dominant PositionOne of the most vigorous users of the predominant international trade defence measure, i.e. antidumping duty, India has an unenviable and unfortunate reputation for extreme protectionism being afforded to its domestic industries through the use of anti-dumping investigations and duties. Anti-dumping as an international trade defence measure is by definition protectionist of the Indian market and is based on the following three touchstones:(i) that there is a significant difference between the normal value of a commodity or product and the price at which it is exported to India;(ii) that the difference between the normal value and the export price to India greater than certain tolerances is per se evidence of dumping;(iii) if this dumping causes or is likely to cause injury to the domestic industry, antidumping duties would be levied.The effect of anti-dumping duty usually renders the export of the product to India economically unviable. Now, the touchstone of competition law is to avoid an appreciable adverse effect on a relevant market. Quite naturally, the availability of competing products, whatever their source, provides wider and more economic options to consumers in the relevant market for a product. Let us consider a practical example. Two dominant Indian manufacturers of a product jointly have in excess of half of the domestic production of the product. Under the rules, a petition for imposition of antidumping duties can be filed by the two as being representative of the domestic industry in India. Let us assume that a few smaller domestic players and exports to India by foreign entities constitute the rest of the supply of the product to the market in India. There is no substantive ideological divergence between anti-dumping law and competition law on the acceptability of the dominant nature of these petitioners. Nothing in competition law disapproves dominance itself as long as it is good. But in case the anti-dumping investigation takes place. This investigation will determine as to whether the users of the product manufactured by the two dominant companies in the market will be left with a reduced choice and constrain them to purchase willy-nilly from the two dominant companies. The nature of anti-dumping proceedings, the costing method usually resorted to by the petitioners, and the reluctance of foreign exporters to disclose sensitive costing information most often means that establishing a proper normal value and that there is no difference between the normal value and the export price to India is not possible.(9) Conflict between anti-dumping law and competition lawThe very conflict that both the laws pose to have is in terms of goals which the respective laws seek to achieve on one hand the goal of competition law is to promote competition, it attaches sanctions to only such price discrimination which adversely affect competition in markets; even if that implies that some competitors may be harmed in the process. On the other hand antidumping law while addressing price discrimination does not take into account competition concerns and its stated goal is to protect domestic industry and in fact ends up as an instrument to protect competitors. Thus it seems to be in direct conflict with Competition Law. Competition and antidumping laws were initially thought to be complementing each other. Over the years however, this position has changed. First, competition laws have widened their reach to include conduct of firms who are outside the jurisdiction, which affect the national market. Second competition law has evolved much faster than anti-dumping laws. By contrast Anti-dumping laws have evolved within the shackles of the WTO Agreement and have become a protectionist tool in several jurisdictions, with the result that in some extreme instances it impairs competition rather than promotes it. Indeed now the ultimate objectives are quite different with competition law aimed at protecting consumers interests and antidumping law designed to safeguard firms businesses. Still, the two sets of laws were originally meant to complement each other, and they are intended to act upon the same market distortion[footnoteRef:7]. Some commentators have even argued that the two laws can sometimes work at cross purposes as competition laws are aimed at curbing the market power of domestic producers, whereas antidumping law attempts to use market power in order to shift rents away from foreigners.45 Antidumping laws were initially enacted to address the situation of international price predation and were considered as extension of competition laws. However over the years the focus of antidumping law seems to have changed and antidumping laws as they exist today do not seem to be concerned with the issue of predatory pricing. To this extent it can be said that antidumping law no longer addresses competition related concerns and since it seems to attach sanctions to every instance of international price discrimination which can be shown to cause injury to the domestic industry, it could very well be in conflict with competition law. [7: Ian Wooton and Maurizio Zanardi, Trade and Competition Policy: Antidumping versus Anti-Trust]

While competition laws are primarily aimed at protecting and promoting competition in markets, antidumping laws are aimed at remedying the injury to the domestic industry which may arise due to dumping. It can be concluded that the modern antidumping laws of today in essence provide for protection of competitors. Several authors have commented on the divergence of antidumping laws from their original objectives[footnoteRef:8]. The evolution in its objectives has resulted in a change in the way that antidumping laws are being used and has consequently changed their ultimate effect on the market and on competitive conditions. For example, while the objectives behind earlier antidumping laws ensured that healthy price competition between corporations was encouraged as long as predatory pricing was avoided, today the mere presence of increasingly protectionist antidumping laws has resulted in a change in the economic behavior of firm wherein instead of profit maximization through healthy price competition, firms choose to seek protection or undertake steps that are more likely to lead to the imposition of an antidumping duty on imports. On the other hand, competition laws continue to encourage price competition within firms in a market as long as it does not result in predatory pricing, with a view to maximizing consumer welfare and protecting the conditions of competition. In other words, the change in the objectives for which antidumping and competition laws are being used today has also in some instances changed their interaction from complementary to conflicting. [8: For instance, Shanker Singham, A General Theory of Trade and Competition - Trade Liberalization and Competitive Markets, Cameron May, 2007]

(10) OverlapsThere is also a tendency to confuse competition law and antidumping law and to regard them as if they are the same. No doubt, the two concepts interrelate and also often do interface[footnoteRef:9]. [9: Peter D. Ehrenhaft, Is Interface of Antidumping and Antitrust Laws Possible? (2002) The George Washington International Law Review, vol. 34, No. 2,]

However, they do differ, both practically and conceptually. While competition law is concerned with ensuring that the activities of business undertakings do not damage the competitive process, antidumping laws target allegedly unfair trading practices of foreign companies accused of exporting (or dumping) products into other countries at prices below the cost of production, or below the price charged in domestic or third markets[footnoteRef:10]. In the modern era, while competition law concentrated on the pursuit of economic efficiency, addressing problems associated with concentrated economic power, antidumping law was intended to create a politically popular form of contingent protection that bears little, if any, connection to the prevention of monopoly. The political constituency for antidumping law is not an antimonopoly constituency, but one for the protection of industries facing weak markets or long term decline[footnoteRef:11]. As has also been argued, the unfairness to which antidumping law is directed prices that are too low is generally seen in competition law as evidence of the proper working of the competitive process, and as a phenomenon beneficial to the consumers whom competition law fundamentally protects[footnoteRef:12]. More succinctly, competition law favours a dynamic, ever changing market of robust competitors; antidumping favours a more static model of the market to protect investors and workers from changes generated from abroad[footnoteRef:13]. Despite these underlying differences between competition and antidumping laws, there are types of dumping which if they occur, could definitely be dealt with under the competition laws because they have the characteristics of anti-competitive nature. These are predatory dumping, and strategic dumping[footnoteRef:14], both variants of market power dumping. Thus, although competition laws and antidumping laws serve historically different functions and address different constituencies, in some aspects they do intermingle. There have therefore been calls in some quarters for antidumping laws to be replaced altogether by competition laws and measures, though these calls are roundly rejected in some quarters too. It should also be noted here that sometimes, anti-dumping measures could actually, though unintendedly, be employed in a way that they would go contrary to the rules of competition. It is possible for inefficient local companies to respond to legitimate foreign competition, not by increasing the efficiency of their operations, but by persuading their governments to restrict foreign competition. The weapon of choice here tends to be antidumping law since these companies, having powerful connections, are able to make their governments utilise the authority offered by the WTO Antidumping Agreement of 1994 to impose arbitrary and punitive tariff measures on the threatening goods and services, and that would effectively scuttle the foreign competition. This is an unwelcome irony that individuals and interest groups who are committed to competition should watch out for and guard against. [10: Claude Barfield, Antidumping Reform: Time to Go Back to Basics Barfield, (Oxford, Blackwells Publishing, 2005)] [11: AO Sykes (1998), Antidumping and Antitrust: What Problems Does Each Address?, in RZ Lawrence (ed.), Brookings Trade Forum: 1998 (Washington, DC: Brookings Institution] [12: Peter D. Ehrenhaft] [13: Peter D. Ehrenhaft] [14: Claude Barfield]

Issues regarding the areas of overlap(i) Predatory PricingUnder competition law predatory pricing is understood as a deliberate strategy, adopted usually by a dominant firm, to drive competitors out of the market by setting very low prices or selling below the firms incremental costs of producing the output (often equated for practical purposes with average variable costs) with intent to eliminate competition or eliminate competitors. Once the predator has successfully driven out existing competitors and deterred entry of new firms, it can raise prices and earn higher profits[footnoteRef:15]. [15: OECD glossary of terms ]

Dumping is a type of international price discrimination, wherein an exporter sells an article at prices lower than those charged to domestic buyers, taking into account the conditions and terms of sale. As per the definition of dumping as contained in the WTO Antidumping Agreement (as well as the national antidumping legislations in the subject countries), the limited requirement for dumping to be condemned and sanctions to be attached against is that, the export price of the product alleged to be dumped should be less than the price at which it is sold in the domestic market of the exporting country and that it should cause material injury to the domestic industry for the like product in the importing country. Thus anti-dumping law is neither concerned with the requirement of dominance nor intention, unlike competition law wherein both these factors are as important conditions as the instance of price discrimination.(ii) Price DiscriminationBoth anti-dumping and competition law seek to address the issue of price discrimination. Antidumping law seeks to address all those forms of price discrimination, which cause or are likely to cause material injury to the domestic industry. Competition law on the other hand seeks to address only such price discrimination, which is unfair or discriminatory (including predatory) in nature and has an appreciable adverse effect on the market. Under competition law only such price discrimination, which adversely affects competition in markets and thus has negative consumer welfare impacts, is prohibited by competition statutes. Under competition law such price discrimination is usually referred to as unfair or discriminatory pricing and a particular instance of price discrimination does not attract sanctions if it can be shown that it is adopted to meet competition and does not affect the conditions of competition in an adverse manner. This requirement therefore involves an examination into welfare effects of the price discriminatory conduct. Certain instances of price discrimination such as predatory pricing have been assumed to affect competition negatively and cannot be justified on the grounds that they have been adopted to meet Competition.In anti-dumping law price discrimination is synonymous with dumping. Jacob Viner defined dumping as price discrimination between national markets. In international trade dumping is said to occur when the sale of products for export is at prices lower than those charged to domestic buyers, taking into account the conditions and terms of sale. According to Article VI, GATT 1994, a product is said to be dumped when its export price is less than its normal value, that is, less than the sale of a like product in the domestic market. The effect of the instance of price discrimination under anti-dumping is examined with the narrow parameters of injury only to the domestic industry and once dumping and injury have been established, then the examination does not take into account broader economic concerns, such as consumers interest, the interests of other users of the product and the like whilst imposing an anti-dumping duty[footnoteRef:16]. With regard to the practice of antidumping law in India, it is noted that though consideration of public interest in an antidumping investigation is not mandatory, but in limited instances even notwithstanding the positive recommendation by the Designate Authority/ Ministry of Commerce, the Ministry of Finance has not imposed anti-dumping duties and this may be due to public interest considerations. The process however is neither formal nor transparent. [16: However to the limited extent that antidumping rules in India as well as other countries such as USA prescribe the lesser duty rule (i.e. if a duty lesser than the margin of dumping is sufficient to remedy the injury to the domestic industry then the antidumping duty should be the lesser of the two), which inherently take account of consumer interest to some extent. ]

(11) Antidumping and Competition Provisions in Free Trade Agreements/Regional Trade AgreementsA few studies have, introduced the idea of replacing antidumping with competition laws, especially in free trade agreements (FTA)[footnoteRef:17]. It has been suggested that the abolition of anti-dumping laws in favour of harmonized antitrust laws enhances economic welfare, and offers a practical solution to the global increase in anti-dumping actions. A uniform standard of competition policy can be applied to regulate a single market, regardless of the nationality of each producer. In this way, price discrimination will be examined under the national competition law (or possibly international law in the future); as long as it is acceptable under the competition rules, no litigation will be initiated against it[footnoteRef:18]. There are currently four regional trade agreements, in which the member countries have abolished the application of antidumping measures amongst themselves: the European Union (EU); the European Economic Area (EEA), which came into force in 1994 by the treaty signed between the EU and the European Free Trade Association (EFTA); the Closer Economic Relations Agreement (CER) between Australia and New Zealand; and the 1996 Canada-Chile free trade agreement. In case of MERCOSUR[footnoteRef:19], member countries are eventually expected to phase out antidumping laws in favour of harmonized competition law regime, but have not yet done so. [17: The Relationship Between Competition Policy and Anti-Dumping Law: The Canadian Experience, a study by Lecenomics Inc.] [18: Hang Zeng, Antidumping and Competition: the Case of China, 2005] [19: Also known as Southern Common Market, is a Regional Trade Agreement (RTA) among Brazil, Argentina, Uruguay and Paraguay, founded in 1991 by the Treaty of Asuncin, which was later amended and updated by the 1994 Treaty of Ouro Preto]

(12) ConclusionThe main objective of Anti-Dumping Law is to protect domestic industries. Does it mean that less efficient industries must be protected? In fact according to Competition Act, 2002 less efficient industries should shut-down and exit market if they cannot compete. Anti-Dumping Law has a protectionist flavour which Competition Law has not. These both contradict, they cannot exist together; they are oxymoron.Over the past years it has been suggested that anti-dumping measures and competition measures are mirror images, complementary mechanisms, and that one should take place of the other. Anti-Dumping measures are, therefore not normally a means of restoring fair trade (although sometimes may be). Rather they are protective mechanism. It would be very optimistic to assume that the elimination of Anti-Dumping measures would easily follow from the widespread institutionalization of competitive measures. Being a part of a developing nation if I would have to choose between elimination of anti-dumping measures in exchange of implementing competition rules it will be a wonderful bargain.From the point of view of economics, there is no reason to support any anti-dumping law, since price differentiation across markets is a legitimate and a perfectly rational, sensible and legitimate profit-maximization action. Under this line of argument, there is no justification for condemning certain export prices simply because they happen to be lower than prices in other markets. Domestic price discrimination i.e., differences in pricing between one countrys domestic regional markets, normally is not penalized. There arguably is no economic reason for treating international price discrimination any more harshly by imposing dumping duties. Of the different categories of dumping, only predatory pricing dumping and most instances of strategic dumping raise overall welfare concerns. Yet, these two forms of dumping pertain largely to the theoretical realm, as most anti-dumping cases in the real world do not involve dumping as defined by these two categories and even Competition Act is there to look after such predatory pricing.Above all, if antidumping were to be a tool against unfair trade as it was initially meant to be, it would be essential to reconsider the definition of dumping and think carefully what is fair and what is not. Is it fair enough to accuse and penalize someone just because prices are not equalized?But before the things got worse reform is necessary. These rules and policies are needed to be amended and a lot can be done. More transparent process of investigation is desirable: one needs to know in details how a constructed price is calculated. Material injury requires more careful scrutiny: is injury caused by dumping or just by higher competition? Consumers' welfare also has to be taken into account, not only in text but also in practice.One of the major proposals could be replacement of anti-dumping with competition principles. One of the major concerns of dumping is predatory dumping i.e. a type of anti-competitive event in which foreign companies or governments price their products below market values in an attempt to drive out domestic competition. This may lead to conditions where one company has a monopoly in a certain product or industry. The function of Competition Commission of India is to take necessary action to address such an issue instead of levying anti-dumping duties.There is a need to review Anti-Dumping Law. Also there is a need to bring this issue in competition policy because draft competition policy does not directly resolve this issue.In order to give protection to domestic infant industries there is a need to make provision for such reform in Competition Act or there is a need to interpret or expand the phrase, ensure freedom of trade carried on by other participants as stated in Section 18 of Competition Act, 2002. Ideally these duties should be abandoned but no country will do so till it is being implemented in other countries. Thus the problem is needed to be solved at multilateral level.It is difficult to create a new framework altogether for this issue. Therefore it will be better to do some changes in existing framework so that it is beneficial for the whole economy. There should be working group meetings on matters of concern (dumping and competition). The change should maximize the welfare of Indian economy.

References AO Sykes (1998), Antidumping and Antitrust: What Problems Does Each Address? in RZ Lawrence (ed.), Brookings Trade Forum: 1998 (Washington, DC:Brookings Institution) Alexandru Moldovan, Antidumping and trade diversion in the United States of America (2013) Cadot Oliver, Grether Jean-Maries and Melo de Jaime, Trade and Competition Policy: Where do we stand? Journal of World Trade, Vol. 34, No. June. Claude Barfield, Antidumping Reform: Time to Go Back to Basics Barfield, (Oxford, Black wells Publishing, 2005) Haberler, Gottifried Von, The Theory of International Trade with its Application to Commercial Policy. Translated by Alfred Stonier and Frederic Benham, New York: Macmillan, 1937. Handbook on Anti-Dumping, Ministry of Commerce, Government of India Hang Zeng, Antidumping and Competition: the Case of China, 2005 Ian Wooton and Maurizio Zanardi, Trade and Competition Policy: Antidumping versus Anti-Trust. Jose Taraves de Araujo, Jr., Anti-dumping in the Americas, 9, OAS Trade Unit Studies, 2001 Jacov Viner, Dumping: A problem in International Trade (1923) OECD glossary of terms Peter D. Ehrenhaft, Is Interface of Antidumping and Antitrust Laws Possible? (200 2) The George Washington International Law Review, vol. 34, No. 2 Shanker Singham, A General Theory of Trade and Competition - Trade Liberalization and Competitive Markets, Cameron May, 2007 Web sources:(i) www.legalserviceindia.com(ii) www.indlaw.com(iii) www.cci.gov.in

Page 14 of 14