As a member state of the World Trade Organization, Turkey provides the opportunity to take the necessary measures to protect its local markets and industries against unfair competition and therefore “unfair” trade practices of foreign exporters that may harm domestic producers.
Dumping exports is one of these unfair trade practices, and as a means of defense policy against dumped exports, local manufacturers are provided with the opportunity to apply for anti-dumping measures, and in this way, additional dumping tax is imposed on the products imported abroad, thereby reducing the prices that constitute unfair competition in the domestic market to the normal market level. .
Dumping practices and related anti-dumping measures are regulated by the Law (Law) on the Prevention of Unfair Competition in Imports (Law) No. 3577 published in the Official Gazette dated 01.07.1989 and numbered 20212, and the Regulation on the Prevention of Unfair Competition in Imports published in the Official Gazette dated 30.10.1999 and numbered 23861. Pursuant to article 2 of the Law, dumping is defined as “the export price of a good to Turkey is below the normal value of a similar good”.
The domestic production branch claiming to be damaged by dumped imports can submit a duly prepared application to the General Directorate of Imports (Directorate) to take action against the import in question. Upon application, if the necessary conditions are met within the framework of the relevant legislation, an investigation can be opened and as a result of the investigation, dumping.
Circumstances Requiring Precautions
Pursuant to Article 3 of the Law, “situations requiring measures; It is defined as the import subject to dumping or subsidy causing material damage in a production branch in Turkey or creating a threat of material damage or physically delaying the establishment of a production branch”. Therefore, in order for anti-dumping measures to be implemented, a good must be dumped and at the same time, this dumped good must cause or threaten material damage to the local production branch or physically delay the establishment of a production branch.
1.Detection of dumping
At this point, it should be noted that it is not possible to determine whether a product/good is dumped by knowing only the export price. Because the concept of dumping is a relative concept, a comparison should be made. This comparison should be made between the export price of a product and the “normal value” (usually the local market price) of the equivalent product in the exporting country. If the export price is less than the normal value, the product is considered dumped. The difference between the two is the “dumping margin”. In this context, the way to evaluate whether a good is dumped or not is determined by the Regulation.
In accordance with Article 5 of the Regulation, normal value is defined as “the comparable price actually paid or payable by independent buyers in the framework of normal commercial transactions for a similar good subject to consumption in the exporting country or country of origin”.
However, if the domestic sales volume in the exporting country’s domestic market is negligible or low, or if there is a special situation in the exporting country’s market, or if the domestic sales in the exporting country are not in “normal business transactions”, the local market price in the exporting country should be used for comparison in the following cases: may not be suitable for In this case, the current export price is compared with the comparable export price of a similar product from the exporting country to a third country, or the “built value” found by adding a profit margin to all costs in the country of origin.
2. Harm and Threat of Harm
Pursuant to Article 16 of the Regulation, damage is defined as “material damage, threat of material damage or physical delay in the establishment of a production branch”. Article 17 determines how the damage will be determined. According to this article 17 “The determination of pecuniary damage should be based on tangible evidence and include an objective examination of the volume of dumped or subsidized imports and the effects of these imports on similar commodity prices in the domestic market and on domestic production. Regarding the volume of dumped imports; It is examined whether there is a significant increase in this import in absolute terms or relative to production or consumption in Turkey. Regarding the effect of dumped or subsidized imports on prices, it is examined whether the prices of dumped or subsidized imports are significantly below the price of similar goods in Turkey or whether these imports have a significant effect on lowering prices or preventing price increases ”.
Actual and potential reduction in losses, profits, production, market share, productivity, investment revenue and capacity utilization; factors affecting domestic prices; the size of the dumping margin; All factors and indicators related to the state of production need to be examined, including actual or potential adverse effects on cash flow, inventories, employment, wages, growth, capital or ability to increase investment.
Threats of pecuniary damage should be based on tangible evidence, not claims, estimates, or remote possibilities. Changes in conditions that would create an environment in which dumped imports would cause harm should be clearly foreseeable and imminent. In this context, the following factors will be taken into account in determining the threat of material damage:
a) A significant increase in dumped or subsidized imports into the domestic market, indicating the possibility of a substantial increase in imports,
b) Considering that there are other export markets that can absorb additional exports; The exporter has a sufficient and freely disposed capacity, or a significant increase in its capacity, which indicates the possibility of a significant increase in dumped or subsidized exports to the Turkish market,
c) Whether the imports are made at prices that will significantly reduce domestic prices or prevent their increase and increase the demand for imports,
d) Stocks of the goods subject to investigation,
e) In subsidy investigations; the nature of the subsidy under investigation and the commercial effects it may have.
Determination of Local Production Branch
As stated above, it is not enough for a product to be dumped and the risk of material damage or damage to this dumped product is not sufficient, at the same time, this damage and the danger of damage must affect the domestic production branch. Therefore, it will not be sufficient for the anti-dumping measures to be damaged by the manufacturers representing only the domestic production branch from this dumped product.
According to the 18th article of the regulation, the domestic production branch refers to all the producers of similar goods in Turkey or the producers who realize a significant part of the production of this product in Turkey. However, if the producers are associated with exporters or importers or are importers of the goods claimed to be dumped or subsidized, the domestic production branch may refer to the rest of the producers .
However, at this point, it should be emphasized that, in accordance with Article 20 of the Regulation, in order for a complaint to be deemed to be made by or on behalf of the production branch; the total similar goods production of the producers supporting the complaint shall be more than 50% of the total similar goods production of the producers supporting the complaint and the producers opposing the complaint and not less than 25% of the total similar goods production in Turkey. Complaints that do not meet these requirements will be rejected.
Complaints, Investigation, Investigation and Collection of Information
Manufacturers, or natural or legal persons acting on behalf of the production branch, claiming that they have suffered material damage or are under the threat of material damage from the imports subject to dumping in accordance with Article 19 of the Regulation, or that such imports physically delay the establishment of a production branch, by applying to the General Directorate in writing. may request measures. The complaint must contain evidence of dumping, damage and a causal relationship between the dumped import and the alleged damage. Applications that are not supported by sufficient evidence will not be accepted.
Following the filing of the complaint to the Directorate, the Directorate will initiate an ex officio investigation for the alleged dumped property and complete this examination within a maximum of 45 days. As a result of the examination, it makes a proposal to the Board for Evaluation of Unfair Competition in Imports (Board) on whether or not to open a dumping investigation. Following this, the Board decides whether to open an investigation and if it is decided to open an investigation, the notification that this investigation has been opened is published in the Official Gazette. An investigation will be deemed to have been opened with the publication of the relevant notification in the Official Gazette.
Pursuant to Article 21 of the Regulation, following the initiation of an investigation, questionnaires are sent to known importers and exporters of the goods under investigation. In subsidy investigations, a questionnaire is also sent to the exporting country. These forms are considered to be received within one week from the date they are sent and are given 30 days to reply. If an application is made within the time limit by stating the reasons, this period may be extended, taking into account the time constraints in the investigation.
When necessary, the Directorate General may also request additional information and documents regarding the investigation from the relevant parties at any stage of the investigation. In order to verify the information at hand or to provide additional information, examinations can be made by the relevant parties. On-site verification investigation,
In addition, pursuant to Article 24 of the Regulation, during the investigation, the Directorate General provides the opportunity to express their views to the relevant parties and industrial users of the goods under investigation, and to representatives of consumer organizations in cases where the goods are sold at retail level. In this framework, listening meetings may be held in order to express opposing views, upon the written request of the relevant persons or the call of the General Directorate.
At this point, it should be emphasized that, if the exporting companies, which are requested to provide information during the investigation, cooperate and share the information, certain exemptions from possible dumping measures can be granted to the cooperating companies. In this context, pursuant to Article 26 of the Regulation, if one of the parties does not provide the necessary information within the given time limits or refuses to access this information, or if it is understood that it hinders the investigation or gives false or misleading information, the said party is deemed not to cooperate. In this case, provisional or final determinations, positive or negative, can be made based on available data.
Investigations to be opened within this scope are concluded within 1 year, except for special cases, pursuant to Article 30 of the Regulation. However, this 1-year period may be extended by the Board when necessary, not exceeding 6 months.
Measures to be Applied
As a result of the investigation carried out in accordance with Article 7 of the Law, an anti-dumping tax is collected for the import of the dumped goods equal to the dumping margin amount determined by the Board and approved by the Ministry. However, if it is determined that the compensation of the loss caused by the import subject to dumping is possible by imposing a tax at an amount or rate less than the determined dumping margin amount, this rate or amount of tax is applied.
The principles regarding the retrospective application of these duties for the goods imported before will be determined by the Cabinet Decision for each dumping application. However, the period of retroactive application cannot exceed 90 days from the date of the temporary measures.
1. Interim Measures
Temporary measures may be in the form of a temporary tax, a security equivalent to the estimated temporary anti-dumping duty, or a customs fixation provided that the estimated amount of dumping duty determined through the Inquiry is indicated. Interim measures cannot be applied before 60 days from the start of the investigation. Although the implementation period of temporary measures is 4 months at the most, this period may be extended up to 6 months upon the request of exporters representing a significant percentage of the trade in question.
Definitive measures are in the form of dumping tax. According to the application and investigation principles, a final dumping tax is imposed for a certain period of time on the relevant product imported from a certain country, and the taxes charged on the export of the relevant product to Turkey are increased, thereby increasing the sales price within the country. In accordance with Article 35 of the Regulation, definitive measures shall cease to be in force 5 years from the date of their entry into force or from the date of conclusion of the last review investigation covering both dumping or subsidy investigation and damage investigation.