Act of Parliament · As enacted
Safeguard Measures Act 2018
Official English translation. Where it differs from the Sinhala or Tamil text, the Act itself says which text prevails.
Official translationFrom Department of Government Printing, unchanged
s 1Short title and date of operation
This Act may be cited as the Safeguard Measures
Act, No. 3 of 2018, shall come into operation on such date as the Minister may appoint, by the Order published in the
Gazette.
The safeguard measures may be applied on products imported into Sri Lanka, where the Director General of Commerce (hereinafter referred to as the “Director
General”) determines pursuant to an investigation initiated and conducted in accordance with the provisions of this
Act, that the investigated product is being imported in such increased quantities, absolute or relative to domestic production and under such conditions, so as to cause or threaten to cause serious injury to the domestic industry producing like or directly competitive products, and that the application of safeguard measures is in the public interest.
Any decisions relating to the application, suspension or withdrawal of safeguard measures and the modification or extension of periods of application of safeguard measures shall be the responsibility of the Inter Ministerial Committee
(hereinafter referred of as the “Committee”).
The Committee shall, subject to the provisions of subsection (2), consist of the following members:-
the Secretary to the Ministry of the Minister, who shall be the Chairman of the Committee;
the Secretary to the Ministry of the Minister in charge of the subject of Finance or his nominee;
the Secretary to the Ministry of the Minister in charge of the subject of Industrial Development or his nominee;
the Secretary to the Ministry of the Minister in charge of the subject of Internal Trade or his nominee;
the Secretary to the Ministry of the Minister in charge of the subject of Agriculture or his nominee;
the Secretary to the Ministry of the Minister in charge of the subject of Foreign Affairs or his nominee;
the Director-General of Customs or his nominee;
and
a nominee of the Governor of the Central Bank of
Sri Lanka.
Notwithstanding the provisions of subsection (1), considering the nature of the proposal being submitted for its consideration under this Act, and where the Chairman considers it appropriate, he may, in consultation with the members referred to in paragraphs (b) and (c) of subsection (1), co-opt not more than two other members to the
Committee.
The Chairman of the Committee shall, if present, preside at all meetings of such Committee, and in the absence of the Chairman from any such meeting, the members present shall nominate one of the members present to preside at such meeting.
The quorum for any meeting of the Committee shall be four members and the procedure in regard to the conduct of meetings and the transaction of its business, shall be regulated by such Committee.
For the purpose of this Act, a determination as to whether increased imports of the investigated product have caused a threat of serious injury or serious injury to a domestic industry, shall be based upon an evaluation of all relevant factors of an objective and quantifiable nature having a bearing on such domestic industry, and in particular, the following factors:-
the rate and amount of the increase in imports of the investigated product in absolute terms and relative to domestic production of like or directly competitive products;
the share of the domestic market taken by increased imports of the investigated product;
the consequent impact on the domestic industry of the like or directly competitive products, evidenced by changes in relevant economic indicators such as production, capacity utilization, inventories, sales, prices (such as decrease in domestic prices or lack of increase in domestic prices, which could have otherwise occurred in the absence of increased imports), productivity, profits and losses, return on investments, cash flow and employment; and
any other relevant factors other than increased imports of the investigated product which also are causing or threatening to cause serious injury to the domestic industry, though such injury shall not be attributed to the increased imports.
A determination of threat of serious injury or serious injury shall be based on objective evidence that demonstrates the existence of a causal link between the increased imports of the product concerned and the alleged threat of serious injury or injury.
Where factors other than increased imports causes threat of serious injury or serious injury to the domestic industry in question at the same time, such serious injury shall not be attributed to such increased imports. In such cases, the Director-General may refer the complaint for anti-dumping or countervailing duty investigations, if necessary.
s 5Threat of serious injury
A determination of a threat of serious injury caused by increased imports of the investigated product shall be based only on actual facts, and in making such a determination, in addition to the factors specified in section 4, the following shall also be taken into consideration:-
the actual and potential export capacity of the country or countries of production or origin of the investigated product;
any build-up of inventories in the country or countries of exportation;
the probability of exports of the investigated product entering the domestic market in increasing quantities; and
any other factors determined relevant by the
Director-General.
s 6Requirement of a written application
An investigation to determine whether increased imports of the investigated product have caused or is threatening to cause serious injury to a domestic industry, shall be initiated -
upon a written application being made to the
Director-General by or on behalf of a domestic industry; or
by the Director-General on his own behalf.
An application made under paragraph (a) of section 6 shall provide such information as is reasonably available to the applicant on the following matters:-
a complete description of the imported product including its technical characteristics and uses and an identification of its tariff classification and the duties applicable to such product;
a complete description of the domestic like or directly competitive products, including the technical characteristics and uses of such products;
the names and addresses of the enterprises making the application or the enterprises on whose behalf the application is being made (hereinafter referred to as the “requesting enterprises”) and of all other known producers of the domestic like or directly competitive products;
the percentage of domestic production of the like or directly competitive products represented by the requesting enterprises;
information on the volume and value of the imported product for each of the three calendar years preceding the date of making the application and any other recent data, by the country of origin;
a description of the increase in imports and in particular whether such increase is absolute or relative to domestic production, or both;
information relating to the serious injury or threat of serious injury to the domestic industry, for each of the three calendar years preceding the date of making the application and recent data, including-
with respect to serious injury -
(A)
volume and value of the domestic product;
(B)
utilization of production capacity;
(C)
changes in inventory levels;
(D)
market share;
(E)
changes in sales levels;
(F)
level of employment and wages in the domestic industry;
(G)
changes in price levels;
(H)
productivity;
(I)
profit and loss;
(J)
return on investment;
(K)
cash flow; and
(L)
any other information that may relate to the existence of a serious injury;
with respect to threat of serious injury-
(A)
export capacity in the exporting countries;
(B)
inventories relating to the imported product available in Sri Lanka and in the exporting countries; and
(C)
information regarding the probability of increase in the imports including trade restrictions on exports to third country markets;
an explanation, in the light of the information contained in the application and the requirements under this Act, of the reasons why it is believed that serious injury or threat thereof exists, and is caused by increased imports;
a statement giving specific reasons for seeking an application of a safeguard measure, such as, to facilitate the orderly transfer of resources to more productive uses, to improve competitiveness or to adapt to new conditions of competition, together with the type and level of the measure considered necessary to ensure the achievement of the objectives pursued;
a plan for adjusting the domestic industry to competition from imports, in accordance with the objectives referred to in paragraph (i) ; and
if a provisional measure is sought, information regarding critical circumstances where delay in taking action would cause damage to the industry which it would be difficult to repair, and a statement indicating the level of tariff increase requested for as a provisional measure.
Every application made under paragraph (a) of section 6 shall be accompanied by such fee as may be prescribed and be submitted to the Director-General together with such number of copies of the application as may be determined by the Director-General.
The Director-General shall take due account of any difficulties experienced by interested parties and in particular small companies, in supplying the information requested for and provide them, through an advisory body constituted for that purpose, with practicable assistance or where appropriate, extend the time granted for the submission of any specified information, as the case may be.
The Minister shall constitute an advisory body for the purpose of assisting applicants in the formulation of applications made under paragraph (a) of section 6. The composition, establishment and all other matters pertaining to such an advisory body shall be as prescribed by the
Minister.
s 8Withdrawal of application
An application made under paragraph (a) of section 6 may be withdrawn prior to initiation of an investigation, and in such a case it shall be considered to have not been made.
Where, after examining the accuracy and adequacy of the information provided in an application made under paragraph (a) of section 6, and being satisfied that there is sufficient evidence of serious injury or threat thereof caused by increased imports, the Director-General shall initiate an investigation. Prior to arriving at a decision to initiate an investigation, the Director-General may seek such additional information he considers necessary, including from the requesting enterprises.
Where the Director-General decides not to initiate an investigation in response to an application made under paragraph (a) of section 6, he shall notify the requesting enterprise making the application or on whose behalf the application is being made of the reasons for not initiating, an investigation.
Where an application has been received by the
Director-General, he shall generally be required to make a decision as to whether or not to initiate a safeguard investigation within a period of thirty days of the date of receipt of the application. Where the application involved complex issues, or if Director-General has sought additional information under subsection (1) of this section, the time for arriving at a decision may be extended by a further period of fifteen days.
s 10Director General may initiate an investigation
The Director-General may on his own behalf, initiate an investigation under this Act, where he has sufficient evidence available of injury being caused or threatened to be caused to the domestic industry by the increased imports of the investigation product, so as to justify the initiation of such investigation.
Where a decision is taken by the Director-General to initiate an investigation under this Act, the Director-General shall immediately -
notify the requesting enterprises and all other interested parties, as well as the relevant representative of the exporting countries, of such investigation; and
publish a notice regarding the initiation of such safeguard investigation in the Gazette and in any newspaper widely circulated in Sri Lanka in all three languages.
The initiation of an investigation shall be deemed to have commenced on the date of publication in the Gazette of the notice referred to in paragraph (b) of subsection (1).
An interested party who wishes to participate in the investigation shall within a period of fifteen days of the date of initiation of the investigation, inform to the
Director-General in writing of its desire to participate in the investigation. The Director-General may, where he considers it appropriate, accept any request from an interested party to participate in an investigation after the period allowed for making submission to participate under this subsection.
The Director-General shall immediately after the initiation of an investigation under this Act, notify the
Committee of such investigation, in conformity with such requirements established by the Committee.
Where a decision is taken by the Director-General not to initiate an investigation upon an application made under paragraph (a) of section 6, the Director General shall inform the Committee and upon the approval of the Committee, he shall cause a notice to be published in the Gazette containing the following information:-
the identity of the requesting enterprises and the domestic products with respect to which the initiation of an investigation is being requested for;
an identification of the imported product which is alleged to be causing serious injury or threat thereof; and
reasons for taking a decision not to initiate an investigation.
s 12Contents of the notice regarding the investigation
The notice regarding the initiation of a safeguard investigation to be published under paragraph (b) of subsection (1) of section 11, shall contain adequate information on the following matters:-
complete description of the product including its technical characteristics and uses and an identification of its tariff clarification and the duties applicable to such product;
a complete description of the domestic like or directly competitive products, including the technical characteristics and uses of such products;
the names of the requesting enterprises, if any, and of all other known producers of the domestic like or directly competitive products;
the country or countries of origin of the investigated product;
a summary of the information on which the allegation pertaining to increase in imports of the investigated products and the serious injury or threat thereof caused by such increase in imports are based;
name, address and telephone number of the
Director-General;
a statement that the date of initiation of the investigation is the date of the publication in the Gazette of the notice regarding the initiation of the safeguard investigation;
whether or not an application of a provisional measure will be considered; and
the proposed schedule for the conduct of the investigation, including -
the date on or before which an interested party who wishes to participate in the investigation may inform the Director-General in writing of such fact;
where the application of a provisional measure is being considered, the date on or before which any written arguments or submissions may be forwarded to the Director-General;
the date on or before which an oral hearing, if so desired, should be requested for; and
the proposed dates for the determination of the application of a provisional safeguard measure, and where relevant, for the determination regarding serious injury or threat thereof and causation, and of any other decision regarding the application of a safeguard measure.
Subject to the provisions of subsection (2), it shall be the duty of the Director-General, except in special circumstances, to conduct an investigation within six months of its initiation. Where the circumstances so requires, the period of six months may be extended further by not more than two months.
Where in any investigation under this Act, the application of any provisional measure is being considered, the Director-General shall make a decision relating to the application of such provisional measures, not earlier than sixty days and not later than ninety days from the date of initiation of the investigation.
s 14Interested parties to submit evidence
In the conduct of an investigation, the Director-General shall give an opportunity to all participating interested parties to the investigation to make their views known on matters being investigated, and to this end
Director-General shall grant to those parties time not exceeding two weeks to-
make submissions and responses to any questions or other requests being made by the
Director-General to obtain any relevant information pertaining to the investigation;
submit any evidence deemed relevant by such parties, including their views on the matter under investigation; and
express their views with regard to whether or not the application of a safeguard measure would be in the public interest.
In the conduct of an investigation under this
Act, the Director-General may request for any information considered relevant for purpose of conducting such investigation, from any customs officer, company, forwarder, other enterprise, both public and private or person, and it shall be the duty of such officer, company, forwarder or enterprise, as the case may be, to provide the information requested for within such time as may be specified by the
Director-General.
The Director-General may, where he considers appropriate, verify or obtain further details on information received by him under section 14 and subsection (1) of this section, and where any such verification is carried out, the
Director-General shall prepare a report describing the findings of such verification and such report, excluding any confidential information obtained, shall be placed in the public file maintained under section 19.
Where in an investigation -
if no hearing is requested for, any participating interested party may submit written arguments concerning any matter it considers relevant to the investigation, not later than a period of one and a half months before the date proposed for the determination regarding serious injury or threat thereof and causation; or
if a hearing is held, not later than a period of ten days before the scheduled date of the hearing, any participating interested party may submit written submissions and information concerning any matter it considers relevant to the investigation.
A participating interested party shall -
where no hearing is requested for, after the expiry of the period allowed for the submission of written arguments; or
where a hearing is held, following such hearing, have a further period not exceeding ten days to submit any further written responses to the written submissions of any other participating interested parties, or submit further written arguments in response to submissions and information presented at the hearing, as the case may be.
The Director-General shall keep confidential all information submitted which is entitled to such treatment under subsection (2) of this section, and such information shall not be disclosed without the specific permission of the party submitting it.
The Director General shall treat as confidential all information designated as confidential by the party supplying such information, which is protected from disclosure under the Right to Information Act, No. 12 of 2016.
The following types of information, if designated as confidential by the person submitting such information, shall for the purpose of subsection (2) be deemed to be supplied in confidence in terms of paragraph (i) of section 5(1) of the
Right to Information Act, No. 12 of 2016 -
business or trade secrets concerning the nature of a product, production processes, operations, production equipment, or machinery;
information concerning the financial condition of a company which is not publicly available;
and
information concerning the costs, identification of customers, sales, inventories, shipments, amount or source of any income, profit, loss or expenditure related to the manufacture and sale of a product.
A party to an investigation may seek confidential status for certain information made available to the Director-General on request being made in that behalf at the time such information is submitted, including reasons for the request for such treatment. The Director-General shall consider such requests expeditiously, and shall inform the party submitting the information, if he determines that the request for confidential treatment is not warranted.
Parties to an investigation shall furnish non-confidential summaries of all information for which confidential treatment is sought, which may take the form of indexation of figures provided in the confidential version, or marked deletions in the text and which shall permit a reasonable understanding of the substance of the information submitted in confidence.
In exceptional circumstances, parties may indicate that information for which confidential treatment is sought is not susceptible of summary, in which case a statement of the reasons why summarization is not possible, shall also be provided by such parties.
Where the Director-General is of the view that the non-confidential summary provided under subsection (5)
fails to satisfy the requirements of that subsection, the
Director-General may determine that the request for confidential treatment is not warranted, and where in such instance the supplier of the information is unwilling to make the information public, the Director-General shall disregard such information, and return the information concerned to the party who submitted it, unless it is demonstrated to the satisfaction of the Director-General that the information is correct.
All participating interested parties shall have an opportunity to submit in accordance with the provisions of this section, evidence and arguments in writing, including responses to the written or oral presentations made by other participating interested parties, and views as to whether or not the application of a safeguard measure is in the public interest.
In an investigation where application of any provisional safeguard measure is being considered, any participating interested party may submit written arguments within a period of fifteen days before the date proposed for the determination of the provisional safeguard measure, with regard to any matter relevant towards arriving at such determination.
The Director-General shall, upon any request made by a participating interested party, not later than a period of fifteen days after publication of the determination regarding the application of a provisional measure, under section 22 or where the application of a provisional measure is not being considered, not later than a period of one and a half month after the initiation of an investigation, fix a date for a hearing at which all participating interested parties may present information and arguments orally.
A hearing under subsection (1) shall be held not later than a period of two months prior to the date proposed for the determination regarding serious injury or threat thereof and causation.
Participating interested parties intending to appear at a hearing shall notify the Director-General at least a period of one week prior to the date of the hearing, of the names of their representatives and witnesses who will appear at the hearing.
Hearings shall be presided over by the Director-General or his nominee who shall ensure that confidentiality is preserved, and shall organize hearings in a manner that ensures that all participating interested parties have an adequate opportunity to present their views.
The Director-General shall maintain a record of the proceedings at the hearing, which shall be placed in the public file maintained under section 19, with the exception of any confidential information.
The Director-General shall establish and maintain a public file relating to each investigation or review conducted under this Act. Subject to the provisions of section 16, the Director-General shall place in the public file -
all public notices relating to the investigation or review;
all material, including questionnaires, responses to questionnaires and written communications submitted to the Director-General;
all other information developed or attained by the Director-General including any verification reports prepared under section 15; and
any other documents the Director-General deems appropriate for public disclosure.
The public file shall be available to the public for review and copying at the office of the Director-General throughout the period of the investigation, review and of any resulting judicial review.
Where, at any time during an investigation, any party interested –
refuses access to, or otherwise does not provide any necessary information within the time determined by the Director-General; or
otherwise significantly impedes the investigation, the Director-General may reach preliminary and final determinations (affirmative or negative), on the basis of the information available, including information contained in the application.
The Director-General shall take due account of any difficulties experienced by parties interested, in particular small companies, in supplying information requested for, and as such shall provide any practicable assistance or may extend the time granted for the submission of any specified information, as the case may be.
The Director-General may recommend the application of a provisional safeguard measure, where he determines that -
there exists certain critical circumstances and delay in taking action may cause damage which would be difficult to repair; and
there is clear evidence that the increased imports of the investigated product has caused or are threatening to cause serious injury.
A provisional safeguard measure shall take the form of a duty payable at the time of importation of the investigated product. This duty shall be in addition to any duty payable under any other written law.
The Director-General shall submit his recommendations to the Minister, who shall forward the same to the Minister in charge of the subject of Finance.
The Minister in charge of the subject of Finance upon receipt of the recommendations of the Director-General shall, in consultation with the Minister, determine whether or not to apply provisional safeguard measures and the amount of provisional duty to be imposed.