Itac seeks reduction of duty on imported LPG containers

18/09/2008 12:00 - 710 Views

On June 19, 2003, the International Trade Administration Commission of South Africa (Itac) published its very first report, which was titled 'Tariff Protection for the Industry Manufacturing Certain Liquefied Gas Containers of Iron or Steel'.

The report was the result of an application that was brought by Cadac South Africa for a protective duty (15% ad valorem) on certain liquefied gas containers of iron or steel. According to the report, the level of customs duty should be reviewed after four years from the date of implementation of the recommendation – on October 17, 2007.

On August 22, 2008, Itac published an application for a reduction in the rate of duty on containers for compressed or liquefied gas – of iron or steel – of welded construction, indelibly stamped that they have a water capacity of 1,5 l or more but not exceeding 150 l.

The reason for the application was that, as liquefied petroleum gas (LPG) cylinders are not manufactured in the Southern African Customs Union (Sacu) region and the duty applicable only increases the cost of gas to the consumer, Itac has decided to publish the application for a reduction in the rate of duty on LPG cylinders from 15% ad valorem to zero per cent.

It is interesting to note that there are two tariff subheadings, created as a result of the initial tariff application. It stands to reason that, if the application is approved, the tariff will revert to a single subheading.

The question that could be asked is: when was the manufacture of LPG cylinders terminated, and why Itac, and not Cadac South Africa, brought the application? Also, where are LPG cylinders now being manufactured? Could this be an example of tariff protection not resulting in the creation of manufacturing capacity?

Anti-Dumping Investigation – Termination
The termination of an investigation into the alleged dumping of extruded aluminium profiles originating in or imported from the People's Republic of China.

Notice of the initiation of an investigation was published in the Government Gazette of August 10, 2007. The initiation followed an application lodged by the Association of Aluminium Extruders.Itac made a preliminary determination that dumping of the subject product was taking place and that the Sacu industry was suffering material injury, but "that there were other factors detracting from the causal link between the dumping of the subject product and the injury".
The Itac commissioners made a final determination recommending to the Minister of Trade and Industry that the investigation be terminated. The detailed reasons for their decision are set out in Itac's Report No 278.

What is of concern is the use of the sentence in the second paragraph above. In essence, it is impossible to understand from reading the report what the methodology is that is used, if any, to determine the importance or weight associated to each factor.

We believe that a methodology should be devised and, if it already exists, that it should be published, to determine the allocation of weights to be used to measure the importance of each of the factors under consideration. This will allow for the determination or measurement of the factors which are used in arguing for or against the imposition of antidumping duties.

Sunset Review Investigation
A sunset review investigation into the antidumping duty on colour-coated products originating in or imported from Australia has been initiated. Colour-coated products are flat-rolled products of iron or nonalloy steel with a width of 600 mm or more, painted, varnished or coated with plastic.

The application was initiated as a result of these products being imported and used in the building of the Cape Town International Convention Centre. Comment is due by September 29.

Published: 12 Sep 08 - 0:00

Source: www.engineeringnews.co.za
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