Trade remedial measures are imposed in order to protect the local industry from onslaught of unfairly priced imports. However, such measures must necessarily also be in the interest of the public at large. Investigating authorities in various countries have been conducting public interest analysis before imposition of any trade remedial measures. In the last two years, India has also undertaken detailed public interest analysis considering the interests of all stakeholders. A new economic interest questionnaire is now being issued in most investigations, allowing all stakeholders to submit their views for or against imposition of a trade remedial measure.

The purpose of imposing trade remedial measures is to protect the domestic producers from a sudden increase in imports or unfair competition from imports. This ensures a healthy competitive market and also provides a level playing field to the domestic industry to compete with the imports. However, the Government would also evaluate whether such measures are in the interest of the public.

Meaning of Public Interest

Public Interest, in layman's terms, means the interest or the wellbeing of the society as a whole. In context of trade remedial measures, public interest refers to the interest of various stakeholder such as upstream producers, producers of product concerned, downstream users and ultimate consumers of the product.

The WTO Anti-dumping Agreement and the Agreement on Subsidies and Countervailing Measures do not explicitly require a public interest analysis to be conducted as part of trade remedial investigation. However, Agreement on Safeguards provides that any safeguard investigation shall include reasonable public notice to all interested parties and public hearings to ensure that the safeguard measure would be in the public interest. Thus, the Agreement requires investigating authorities to undertake a thorough public interest analysis before recommending imposition of safeguard measures.

Public Interest Analysis - Indian and Global practice

Investigating Authorities in a number of countries, have a detailed procedure for analysing public interest as part of anti-dumping and anti-subsidy investigations. The European Commission analyses the impact of imposition of a measure by taking into consideration the 'union interest' in each investigation. In Canada, it is expected that the measures are always in the interest of the public. However, a public interest inquiry may be conducted suo motu or upon request by an interested party, only when the CITT is satisfied that there exist grounds to suggest that imposition of measure may not be in public interest. Further, public interest analysis in trade remedial investigations is also incorporated in the legislations of Argentina, Brazil, China, Malaysia, New Zealand, Thailand, Ukraine, etc.

In India, analysis of Indian industry's interest has been a part of trade remedial investigations since several years. However, public interest analysis in anti-dumping and anti-subsidy investigations has recently gained traction with the Directorate General of Trade Remedies ("DGTR") undertaking detailed analysis of public interest in its final findings. In the last one year, the DGTR has examined and conducted a public interest analysis in almost all the cases in order to determine the overall impact of the duties, such as in the case of Décor Paper, Rubber Chemicals, LDPE, Aluminium Foil, Caustic Soda. Some of the factors considered by the DGTR include likely impact of duties on downstream users and consumers, demand-supply gap in the country, investment and employment by the Indian industry, environmental impact of duties, creation of a monopolistic market situation, interests of the MSME sector, availability of substitutes. etc. It is interesting to note that despite such detailed public interest analysis, the Ministry of Finance has repeatedly rejected various recommendations by the DGTR, citing the same to be in "overall public interest".

Introduction of Economic Interest Questionnaire

Recently, the DGTR held a stakeholder consideration wherein they proposed an Economic Interest Questionnaire with the intent of giving all the interested parties a chance to submit their views regarding imposition of a trade remedial measure and explain their stance.

In September, this questionnaire was issued for the first time to the domestic industry and other interested parties in the ongoing sunset review investigation of anti-dumping duty on imports of Monoisopropylamine from China. The questionnaire has subsequently been issued in all recently initiated investigations. The questionnaire has now become a mandatory requirement in all anti-dumping and anti-subsidy investigations in India. It covers all the aspects required to analyse public interest and will provide a more holistic view of the investigation. The questionnaire has been divided into 5 parts, with specific parts requesting information for specific interested parties.

  • Part I (General Section) of the questionnaire contains general questions regarding the reasons for the interest of a party, impact of the duty on their sector, details of other trade barriers on the subject goods, etc.
  • Part II (Administrative / Line Ministry) of the questionnaire requires information regarding details of the concerned administrative Ministry and whether or not they support the imposition of duties. This section is very unique since the DGTR is inviting comments not only from the interested parties but also from the administrative ministry associated with the subject goods.
  • Part III (Domestic Producers) of the questionnaire seeks information from the producers of the concerned product which includes capacity and production details, prevailing price of the subject goods in the market and the price of the imported goods.
  • Part IV (Importers And / Or Downstream Users) invites comments from the downstream industry on the prevailing market conditions for the subject goods, substitutes available in the market, impact of duties on their operations, and details of exports and investments made by them.
  • Finally, Part V (Upstream Industry), covers the dependency of their operations and share of their product in the subject goods, investments and volume of sales made and impact of any past duties.

This questionnaire is a huge step towards a more transparent investigation. Earlier, the DGTR was examining public interest, based on submissions made by interested parties, in an unstructured manner. However, the questionnaire would ensure that interested parties have an opportunity to be aware of and rebut the claims of opposing parties and would allow for conclusions on public interest duly supported by facts and evidence, with regard to the interest of all the parties.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.