INTRODUCTION

International trade is one of the key drivers of economic growth. It allows businesses to
expand beyond their local markets, encourages competition, and gives consumers access to a
variety of goods and services. However, not all competition in global markets is fair. Sometimes,
businesses engage in practices that distort the market and harm domestic industries. One such
practice is dumping, where companies sell products in foreign markets at extremely low prices
sometimes even lower than their production costs. This can put local manufacturers at a serious
disadvantage, leading to job losses, reduced innovation, and even the collapse of entire
industries.

To prevent this unfair competition, governments enforce anti-dumping laws. These laws
allow them to investigate cases of dumping and impose additional duties (extra taxes) on the
imported goods to bring their prices closer to fair market levels. This helps local businesses
compete on a more level playing field. However, while anti-dumping laws protect domestic
industries, they also create challenges for international trade. If these measures are applied too
aggressively, they can reduce competition, limit consumer choices, and even trigger trade
disputes between countries.1

At the same time, most countries also have competition laws (also called antitrust laws).
The purpose of competition laws is to prevent businesses from forming monopolies, fixing
prices, or using unfair strategies to eliminate competitors. These laws encourage open markets
where companies compete fairly based on price, quality, and innovation. Competition law
ensures that no single company becomes too powerful and that consumers continue to benefit
from affordable prices and diverse product options.2

The intersection of anti-dumping laws and competition laws creates a complex legal and
economic landscape. While both aim to ensure fairness, they sometimes work against each other.
Anti-dumping measures can restrict foreign competitors, making the market less competitive. On
the other hand, competition laws promote free and open markets, where barriers to entry should

1
World Trade Organization (WTO), "Understanding the WTO: Anti-Dumping Measures”.
2
European Commission, “Competition Policy and Fair Markets,”
1
be minimized. If not managed properly, these conflicting objectives can lead to unintended
consequences, such as higher prices for consumers and a less dynamic market.3

For example, imagine a domestic industry that struggles to compete with low-priced
imports. If anti-dumping duties are imposed, local producers may feel protected and raise their
prices, knowing that foreign competitors have been restricted. This could reduce competition and
harm consumers, who now have to pay more for the same products. On the flip side, if anti-
dumping measures are not enforced when needed, predatory foreign firms could drive local
businesses out of the market, eventually gaining too much control and charging higher prices
later.4

The process of opening up of markets may pose threat to domestic industries, which may
wilt in the wake of increased foreign competition. Such threats from foreign competition may not
always be ‘fair’. In order to allay these fears, the multilateral framework for trade liberalization
under the General Agreement on Tariffs and Trade (GATT) provided for certain contingency
measures such as ‘antidumping’ to protect the domestic industry from ‘unfair trade practices’
such as ‘dumping’. India enacted its frame work of antidumping laws and rules in 1995 in order
to give effect to India’s commitments under the World Trade Organisation (WTO). Since then,
India has emerged as one of the most prolific users of antidumping measures in the world.

The use of anti-dumping law as a viable trade policy measure to protect domestic
industry together with the enactment of the Competition Act, 2002 to promote and sustain
competition in markets presents a unique policy challenge and is one of the more important
policy concerns facing India.

Prima-facie competition law and antidumping law may be at crossroads. While

competition law is focused on the larger goal of protecting and promoting competition in
markets, antidumping law has a much narrower focus, i.e. protecting the domestic industry.
Given the divergence in the objectives of the two sets of laws, it is important to analyze the
possible ways in which the two may interact and determine whether they are in conflict with
each other. Particularly in light of the fact the fact that the competition law regime in India is still

3
United Nations Conference on Trade and Development (UNCTAD), "Balancing Trade Protection and Competition
Policy,"
4
OECD, "The Impact of Anti-Dumping Measures on Competition,"
2
evolving, it is imperative to understand the manner in which the Competition Act, 2002 may
interact with the existing antidumping law. 5

Antidumping and competition law diverges on both legal and economic grounds. On the
point of law antidumping allows such practices which are prohibited under competition laws
such as price undertakings1 and quantitative trade restrictions. And on the same time punishes
certain kinds of price differentiation that are justifiable under the competition laws. Nevertheless,
they also share some commonality. As it has been said that competition law and antidumping law
comes from the same family tree, the two diverge widely. 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.6

The process of economic liberalization and institutional reforms which formally began in
1991 has significantly shaped India’s transition from a planned economy to a market economy.
The substitution of the erstwhile Monopolies and Restrictive Trade Practices Act (MRTP), 1969
by the Competition Act, 2002 is an exercise to facilitate India’s transition towards a market
economy. The new Competition policy is aimed at promoting and sustaining competition in
Indian market and ensuring overall economic efficiency in the wake of a liberalized economy.

The increase in the use of antidumping measures, particularly by developing countries

following the introduction of competition law, has sparked concerns about the effectiveness of
these measures. The author examines the suggestion that antidumping laws may require revision
in light of antitrust laws. The antidumping measures are sought to be justified on the ground of
safety valve theory which means that “anti-dumping serves as a means to act as a domestic
support for trade liberalization”.7 Richard Dale has suggested that if it can be accepted that role
of anti-dumping be confined to remove predatory pricing only and as predatory pricing is not a
great issue then there will hardly be left any explanation for anti-dumping measures 8. It has also
5
Competition Commission of India, “Study on Antidumping and Competition Law”, Economic Laws Practice.
6
Mr Owais Hasan Khan, INTERFACE BETWEEN ANTIDUMPING AND COMPETITION LAW: A CRITICAL
ANALYSIS., Manupatra, April – June, 2016.
7
Mark Wu, “Antidumping in Asia’s Emerging Giants”53 HILJ 30 (2012)
8
Richard Dale, Anti -Dumping in Liberal Trade Order (The Macmillan Press Ltd, London, 1980).
3
been observed by the Ex-Chairman of the US Tariff Commission “here being no predatory
dumping in the United States, the chances of its happening being fairly remote ... I think that,
considering the social costs of the Anti-dumping Act as it's likely to be administered under any
sort of practical circumstances, I would opt for getting rid of the whole Anti-dumping Act.” 9 The
manner in which anti-dumping has been resorted to and the impact in which it has resulted into
has led to the approach towards antidumping being changed entirely. The rules relating to Anti-
dumping laws are considered as the most ironic provision of World Trade Organisation but it has
considerable adverse impact on international trade and healthy competition. Michael Finger says
that “antidumping is a trouble-making diplomacy, stupid economics and unprincipled law” 10. If
applied in the context of India itself the Customs Act curbs any sort of price discrimination
between two countries and not only predatory pricing. Whereas the competition Act does not
control price discrimination, the aim is to boost welfare of consumer.

To draw the relationship between antidumping and antitrust, the objective they seek to
pursue becomes a touchstone to be analysed to arrive at better conclusion. The competition Act
of India lays down a very broad framework for the jurisdiction of Competition authority over
anti-competitive agreement11, abuse of dominance12 and Combinations13. The very object of the
Act is to promote and sustain competition in market, to protect consumer interest and to assure
freedom of trade in the market. On the other hand, The Customs and Tariffs Act aims to
consolidate the law regulating custom duties. The provisions relating to anti- dumping i.e., sec
9A, 9B and the Anti- dumping Rules 1995 were made for the discharge of India’s obligations
under Anti- dumping agreement. Thus, the provisions of Customs tariff Act seek to lay down
Indian law of anti-dumping. In a different context the apex court has discussed the relationship
between objects of both the laws.

CHAPTER I

9
Ibid
10
J. M. Finger “The Origins and Evolution of Antidumping Regulations,” in J. M. Finger (ed.) Antidumping: How It
Works and Who Gets Hurt (University of Michigan Press, 1993)
11
The Competition Act 2002,( Act 12 of 2003)s. 3
12
The Competition Act 2002, ( Act 12 of 2003)s. 4
13
The Competition Act 2002, ( Act 12 of 2003)s. 5
4
 HISTORICAL BACKGROUND

1.1. Early Global Trade and the Need for Regulation

Trade between nations has been a cornerstone of economic development for centuries. In
ancient times, the Silk Road and maritime trade routes allowed countries to exchange goods,
culture, and ideas. However, the absence of formal legal structures meant that trade was
governed by local customs, merchant guild rules, and colonial priorities. With the rise of
industrialization in the 18th and 19th centuries, global trade increased rapidly, but so did
economic rivalries and unfair trade practices like dumping where a company exports a product at
a price lower than its domestic market or cost of production to gain market share in a foreign
country.

The growing instances of dumping began to create concerns among domestic industries,
especially in Europe and North America, which started feeling the economic pressure of cheap
imports. These industries called for protectionist measures to safeguard their businesses and
economies. It was in this context that the earliest forms of anti-dumping laws began to take
shape.

1.2. Jacob Viner’s Foundational Work (1923)

The intellectual foundation of anti-dumping laws was laid by Jacob Viner in his landmark
work “Dumping: A Problem in International Trade” (1923). Viner categorized dumping into
three types sporadic, intermittent, and persistent (or predatory) dumping. Sporadic dumping
refers to temporary disposal of surplus goods; intermittent is aimed at market penetration; and
predatory dumping involves long-term price cutting to eliminate competition and monopolize the
market. Viner’s research emphasized the long-term harm dumping could do to domestic
producers and markets, thus calling for regulatory intervention.14

1.3. The First Anti-Dumping Laws (Canada and U.S.)

The first legal action against dumping came from Canada, which enacted the world’s first
anti-dumping legislation in 1904 the Anti-Dumping Act. This was followed by the United States
through the Revenue Act of 1916 and later the Anti-Dumping Act of 1921, which allowed for the

14
Viner, J. (1923). Dumping: A Problem in International Trade. University of Chicago Press.
5
imposition of special duties if goods were sold in the U.S. at unfairly low prices. These early
laws were driven by domestic industries lobbying for protection against cheap European
imports.15

These laws marked the beginning of a structured legal response to unfair trade practices.
However, enforcement was still inconsistent, and many countries lacked similar legal tools,
leading to an uneven playing field in international commerce.

1.4. The GATT Era and Multilateral Regulation

A major shift came after World War II, when nations began to realize that unregulated trade
practices could lead to economic instability and conflict. In 1947, the General Agreement on
Tariffs and Trade (GATT) was established, laying the groundwork for a rules-based international
trading system. Article VI of GATT explicitly permitted countries to take action against dumping
if:

 A product was being sold at less than its “normal value”

 It caused or threatened to cause material injury to domestic industry.16

This was a historic development because it moved the issue of anti-dumping from national
protectionism to an international legal framework. The provision allowed countries to impose
anti-dumping duties but required proper investigations and evidence of injury.

1.5. The Birth of the WTO and Strengthened Anti-Dumping Rules

The next significant milestone was the creation of the World Trade Organization (WTO)
in 1995, which replaced the GATT framework. Alongside it, the WTO Anti-Dumping Agreement
(ADA) was signed. This agreement provided more clarity and procedures on how dumping
investigations must be conducted, what constitutes injury, and how duties should be imposed and
reviewed.17

Key features of the WTO Anti-Dumping Agreement:

15
Prusa, T. (2001). On the Spread and Impact of Anti-Dumping. NBER Working Paper.
16
GATT 1947, Article VI.
17
WTO. Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Anti-
Dumping Agreement).
6
  Defines dumping as the export of a product at a price lower than its comparable price in
the exporting country’s market.

 Requires proof of material injury to domestic industry.

 Mandates causal link between the dumped imports and the injury.

 Allows provisional and definitive duties, and price undertakings.18

This was a turning point for anti-dumping regulation, as it provided a uniform structure and
minimized arbitrary protectionist behavior by countries.

1.6. India’s Adoption of Anti-Dumping Laws Post-WTO

India, being a founding member of the WTO, adopted its anti-dumping framework in line
with WTO requirements through the Customs Tariff (Identification, Assessment and Collection
of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, under
the Customs Tariff Act, 1975. The primary enforcement body is the Directorate General of Trade
Remedies (DGTR).19

Since then, India has become one of the world’s most active users of anti-dumping
measures, often targeting imports from China, South Korea, and the European Union. Notably,
anti-dumping actions have been applied in sectors such as steel, chemicals, textiles, and solar
panels.20

1.7. Evolution of Competition Law: From MRTP to the Competition Act, 2002

Parallel to the development of anti-dumping law, the evolution of competition law

emerged from a different trajectory. Competition law also known as antitrust law in the United
States—aims to prevent market dominance, monopolies, collusion, and abuse of power. While
anti-dumping laws protect industries from foreign threats, competition law addresses internal
market fairness.

India initially had the MRTP Act, 1969 (Monopolies and Restrictive Trade Practices Act),
focused on preventing economic concentration. However, economic liberalization in the 1990s

18
Ibid, Articles 2, 3, and 7.
19
Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty) Rules, 1995.
20
Bhattacharjea, A. (2008). Anti-Dumping, Competition, and WTO Law. Oxford University Press.
7
revealed the law’s limitations. In response to the Raghavan Committee Report (2000), India
passed the Competition Act, 2002, establishing the Competition Commission of India (CCI).21

Key objectives of the Competition Act, 2002:

 Promote and sustain competition in markets.

 Prevent anti-competitive agreements.

 Prohibit abuse of dominant position.

 Regulate mergers that may cause adverse effects on competition.22

1.8. Clash and Complementarity: Competition vs. Anti-Dumping

The coexistence of anti-dumping and competition laws created an inherent tension. While
anti-dumping measures restrict foreign firms (to protect domestic players), competition laws
ensure no firm domestic or foreign misuses its position.

For example:

 Under competition law, low prices due to efficiency are encouraged.

 Under anti-dumping law, the same low prices can be penalized if they hurt domestic
producers.23

Moreover, anti-dumping actions often ignore consumer welfare, focusing instead on producer
protection. This raises questions on whether anti-dumping measures conflict with the goals of
promoting free and fair competition.

1.9. Judicial and Academic Debate on Harmonization

Legal scholars like Fox (2003), Bhattacharjea (2008), and Hoekman & Mavroidis (2011)
have debated the need for a harmonized framework where competition principles are integrated
into anti-dumping assessments. They argue that:

 Anti-dumping laws are sometimes used rather than as genuine trade remedies.

21
Raghavan Committee Report, 2000.
22
The Competition Act, 2002 (India), Sections 3 to 6.
23
OECD (2002). The Impact of Anti-Dumping Measures on Competition.
8
  There is no requirement under WTO law to analyze the intent of the exporter, leading to
overuse of anti-dumping duties.

 A competition impact assessment should be mandatory before imposing duties.24

In India, the Mehta & Agarwal (2011) study highlighted instances where anti-dumping
measures conflicted with the Competition Act’s objectives, especially in sectors like solar energy
and pharmaceuticals.25

1.10. Case Studies Demonstrating Conflict

While anti-dumping laws and competition laws have distinct objectives, their practical
implementation often intersects, leading to conflicting outcomes. This is especially visible in
real-world case studies, both from India and globally, where trade remedy measures intended to
protect domestic industry have clashed with the principles of promoting competition and
protecting consumer welfare. These case studies help to illustrate the complexity and practical
contradictions at the heart of your research.

A. Grasim Industries Ltd. v. Competition Commission of India (2018)26

This case is not a dumping case, but it illustrates how pricing practices can be viewed
differently under the two laws.

Background:

Grasim Industries was accused of abusing its dominant position in the cement industry by
indulging in excessive pricing and limiting production, thereby influencing market supply and
prices.

CCI's Decision:

The Competition Commission of India held that such behavior amounted to abuse of
dominance, violating Section 4 of the Competition Act, 2002. Grasim was fined, and corrective
measures were recommended.

24
Fox, E. (2003). Competition Law and the WTO: The Unfinished Agenda. Journal of International Economic Law;
Hoekman & Mavroidis (2011). Incorporating Competition Principles into Anti-Dumping Law.
25
Mehta, P., & Agarwal, M. (2011). India’s Competition Act and Anti-Dumping Measures: A Policy Conflict?. CUTS
Institute.
26
Grasim Industries Ltd. v. Competition Commission of India, (2018) 16 SCC 1.
9
Relevance to Anti-Dumping:

In anti-dumping law, raising prices through duties is sometimes seen as a valid defense
strategy for domestic producers. However, in this case, price manipulation by a dominant
domestic firm was penalized under competition law.

This paradox shows how the same pricing behavior can be viewed positively under one
law and negatively under the other, depending on which law is being enforced.27

B. EU – Steel Imports from China

In the European Union, anti-dumping duties were imposed on Chinese steel imports in
response to complaints from European steel manufacturers about unfair pricing.

Rationale:
The duties were justified by the European Commission as necessary to prevent market
injury and maintain industrial competitiveness.

Unintended Effects:

 European automakers and construction firms faced higher steel prices.

 Consumer product costs increased.

 Critics claimed that the EU was using anti-dumping as a disguised form of protectionism.

This case became an example of how trade remedies can cause internal economic harm,
raising questions on whether competition assessments should be mandatory before imposing
duties.28

C. U.S.–Canada Softwood Lumber Dispute

27
Section 4 of the Competition Act, 2002.
28
Evenett, S., & Vermulst, E. (2005). Case Study on EU-China Steel Dumping. Journal of Trade Policy.
10
 This long-standing trade dispute between the United States and Canada involves the U.S.
imposing anti-dumping and countervailing duties on Canadian softwood lumber, claiming that
Canadian producers receive unfair subsidies and sell lumber at below-market prices in the U.S.

Trade Impact:

 Duties increased housing construction costs in the U.S.

 Canadian producers lost market share.

 The dispute has gone through multiple rounds of litigation under NAFTA and WTO.

Policy Clash: While the U.S. claimed to protect domestic lumber producers, consumer
advocates and builders argued that the duties restricted market competition, leading to artificial
price inflation.

This case demonstrates how prolonged anti-dumping actions can lead to political
tensions, economic inefficiencies, and violations of free trade and competition norms. 29

Thus, the historical development of anti-dumping and competition laws reveals a dual
evolution one rooted in protection from foreign pricing practices, and the other in promoting
internal market competition. While both legal regimes aim to correct market distortions, their
application often leads to conflicting outcomes.

 Anti-dumping laws evolved to safeguard domestic industry against predatory or unfair

foreign pricing.

 Competition laws emerged to ensure a free, competitive marketplace that serves

consumers' interests.

 The WTO has provided a global platform for anti-dumping discipline, but it lacks
integration with competition law principles.

 India, as a developing country with growing trade and competition regimes, must address
the overlapping impact of both legal tools to avoid policy contradictions.

29
Bown, C. P. (2013). The WTO and Anti-Dumping in Developing Countries. Brookings Institution.
11
 Therefore, a harmonized legal and policy framework is the need of the hour—one that
balances the goals of protecting industries with the broader aim of market efficiency and
consumer welfare.

CHAPTER II

12
 RESEARCH METHODOLOGY

The topic of this research involves multiple complex issues, such as understanding legal
provisions, analyzing policies, interpreting judgments, and evaluating economic effects. To study
these properly, a combination of doctrinal, qualitative, and comparative research methods has
been used.

1. Research Design

The research design is the overall plan or strategy that guides the research. This study
follows a qualitative and doctrinal legal research design. It mainly involves collecting and
analyzing legal texts, case laws, policy documents, and scholarly articles. The purpose is to
understand the legal frameworks related to anti-dumping and competition law, how they work in
practice, and where they may overlap or conflict.

This design is best suited for legal research because it allows deep analysis of statutes,
judicial decisions, and regulatory principles.

2. Nature of the Study

This research is analytical, explanatory, and comparative in nature:

 Analytical because it examines legal texts, policies, and decisions related to anti-
dumping and competition laws.

 Explanatory because it explains how these laws work, how they impact markets, and
how they interact with each other.

 Comparative because it also looks at international practices and compares India's legal
framework with other countries like the U.S., EU, and China.

This approach helps provide a full picture of the subject and supports the goal of suggesting
improvements to the Indian legal system.

3. Objectives of the Methodology

The main objectives of this research methodology are:

1. To understand the concept of dumping and anti-dumping practices.

13
 2. To analyze Indian anti-dumping laws, especially in light of WTO rules.

3. To examine the role of the Competition Act, 2002 and the Competition Commission of
India (CCI).

4. To study the intersection of anti-dumping and competition laws.

5. To evaluate the impact of these laws on pricing, consumer welfare, and market
competition.

6. To identify policy conflicts and recommend legal reforms.

4. Sources of Data

This study mainly uses secondary data sources, which include the following:

a) Legal Texts and Statutes

 The Customs Tariff Act, 1975 and Anti-Dumping Rules, 1995 (India)

 The Competition Act, 2002

 WTO Agreements, especially the Anti-Dumping Agreement and GATT Article VI

b) Case Laws

 Judgments and orders by Indian courts and tribunals

 Decisions of the Competition Commission of India (CCI)

 WTO dispute settlement cases

c) Policy Documents and Reports

 Reports of the Directorate General of Trade Remedies (DGTR)

 Publications by the Ministry of Commerce & Industry, Government of India

 CCI reports and policy briefs

d) Academic Sources

 Books by legal scholars (e.g., Bhattacharjea, Viner, Whish & Bailey)

14
  Research articles and journals on anti-dumping and competition law

e) Trade and Economic Data

 WTO and World Bank trade reports

 Market impact data and pricing trends in relevant sectors

 Statistics related to anti-dumping cases filed and duties imposed

These sources offer both legal insights and economic data to support the arguments and analysis
in the research.

5. Methods of Data Collection

Since this research is doctrinal and library-based, data was collected through:

 Reading and interpreting legal statutes and rules.

 Collecting and summarizing judicial decisions and tribunal orders.

 Studying academic literature such as books, articles, and papers.

 Reviewing policy reports and economic data published by government and international
bodies.

All information has been carefully reviewed, filtered, and organized to ensure relevance to
the research questions.

6. Data Analysis Techniques

The data collected from the above sources was analyzed using the following techniques:

a) Doctrinal Legal Analysis

This involves close reading of legal texts, interpreting statutory provisions, and applying
them to real-world cases. For example, comparing the language of the WTO Anti-Dumping
Agreement with India’s Customs Tariff Act helps understand India’s compliance with
international obligations.

b) Case Law Analysis

15
 Judgments from Indian courts, the CCI, and the WTO Dispute Settlement Body were
studied to understand how laws are interpreted and enforced. This helped evaluate whether anti-
dumping actions are consistent with competition law principles.

c) Comparative Analysis

The anti-dumping and competition laws of other countries like the United States,
European Union, and China were examined. Their practices were compared with Indian law to
identify best practices and legal gaps.

d) Thematic Analysis

Recurring themes such as consumer welfare, industrial protection, and market efficiency
were identified in laws and literature. These themes were used to structure arguments and
support the hypothesis that anti-dumping and competition laws often conflict in practice.

e) Policy Evaluation

Reports from the DGTR and CCI were used to analyze how legal policies are
implemented. This helped assess whether laws achieve their intended objectives and what
improvements may be needed.

7. Limitations of the Methodology

Like any research, this study has a few limitations:

 It mainly focuses on Indian laws and WTO rules, so results may not fully apply to
countries with very different legal systems.

 The study uses secondary data; there is no original survey or empirical work.

 The scope is limited to legal and economic analysis, and not detailed statistical modeling.

 Laws and policies are constantly evolving, so some findings may become outdated with
new reforms or judgments.

Despite these limitations, the methodology provides a strong foundation for understanding
the legal intersection between anti-dumping and competition laws.

16
8. Ethical Considerations

All sources used in the research have been properly acknowledged and cited. No false
data or unauthorized materials have been used. The analysis is neutral, unbiased, and based on
objective reading of legal texts and cases. The goal is to contribute meaningfully to legal
scholarship and policymaking without misrepresenting any viewpoint.

This methodology ensures that the research is structured, focused, and credible, allowing
clear answers to the research questions and helpful suggestions for future legal reforms.

2.1. Research Objectives

Here are the detailed objectives of the research:

1. To Understand the Concept of Dumping and Anti-Dumping Practices

The first objective is to understand what dumping really means in the context of
international trade. Dumping is when a company exports products at prices lower than those in
its own country or below production cost. While this may seem beneficial to consumers in the
short run, it can harm domestic industries in the long term.

This objective includes studying the different types of dumping, such as sporadic,
intermittent, and predatory dumping, and understanding why countries take action through anti-
dumping measures.

2. To Analyze India’s Anti-Dumping Laws and Their Enforcement Mechanisms

The second objective is to look into how India deals with dumping. India uses the
Customs Tariff Act, 1975 and the Anti-Dumping Rules, 1995 to impose duties on dumped
products. The goal is to protect domestic industries from unfair trade practices.

This research studies how anti-dumping investigations are carried out by the Directorate
General of Trade Remedies (DGTR) and how duties are imposed by the Ministry of Finance. The
objective also includes checking how closely India follows WTO rules while applying these
laws.

3. To Evaluate the Role of the Competition Act, 2002 in Controlling Unfair Trade Practices

17
 Another important objective is to study India’s competition law. The Competition Act,
2002 is meant to prevent monopolies, abuse of market power, and unfair business practices. The
Competition Commission of India (CCI) enforces this law to ensure that markets remain open,
fair, and competitive.

This research examines how the CCI works to protect consumer interests, stop price-
fixing cartels, and regulate mergers and acquisitions. It also explores how competition law
supports a free market economy.

4. To Analyze the Intersection of Anti-Dumping and Competition Laws

One of the most important objectives of this research is to examine how anti-dumping
laws and competition laws interact. Sometimes, they support each other, but in many cases, they
clash. For example, anti-dumping duties might reduce competition by making it harder for
foreign companies to enter the market, while competition law tries to encourage more players in
the market.

This research aims to identify these areas of conflict and understand their impact on
pricing, consumer choice, and market fairness.

5. To Find a Balance Between Industry Protection and Market Competition

The final objective is to suggest ways to balance both legal systems. While it is important
to protect domestic industries from unfair dumping, it is also necessary to maintain healthy
competition for the benefit of consumers. The research will propose legal and policy reforms that
can help align anti-dumping measures with the principles of competition law.

6. To Study the Historical Development of Anti-Dumping and Competition Laws

This objective aims to trace how both anti-dumping and competition laws evolved
globally and in India. By understanding the historical context—starting from early 20th-century
anti-dumping legislation in countries like Canada and the U.S., and the post-liberalization shift to
competition law in India you will gain insight into the reasons behind the development of these
laws and how they have responded to global economic changes.

7. To Compare Indian Legal Frameworks with International Best Practices

18
 This research seeks to compare India’s anti-dumping and competition law framework
with those of developed countries such as the United States, European Union, and China. The
objective is to identify global best practices, draw comparative insights, and suggest
improvements for the Indian legal system. This will also highlight the different ways in which
countries deal with similar issues of trade protection and market fairness.

8. To Assess the Role of International Bodies like the WTO in Shaping National Laws

This objective focuses on the influence of international organizations like the World
Trade Organization (WTO) in harmonizing anti-dumping laws across countries. It will evaluate
how India has adjusted its domestic laws to comply with WTO rules and to what extent WTO
dispute settlement decisions have affected India’s anti-dumping practices.

9. To Analyze the Impact of Anti-Dumping Measures on Consumer Welfare

While most anti-dumping policies are designed to protect producers, this research also
aims to assess their impact on consumers. When anti-dumping duties are imposed, they may lead
to higher prices, fewer choices, and reduced innovation. This objective is to study whether
consumer interests are being considered during investigations and to recommend ways to include
consumer welfare in the anti-dumping policy framework.

10. To Examine Judicial and Regulatory Decisions in India on Dumping and Competition

This objective aims to review important case laws, both from Indian courts and
international forums, that reflect the interpretation, implementation, and conflict between anti-
dumping and competition laws. Judgments from the Supreme Court of India, Competition
Commission of India (CCI), WTO Dispute Settlement Body, and the DGTR will be studied to
understand real-world application of these legal regimes.

11. To Identify Gaps and Overlaps Between Anti-Dumping Law and Competition Law

The research will aim to identify legal gaps, ambiguities, or overlaps between the two
legal frameworks. This includes studying how price undertakings or duties imposed under anti-
dumping law may sometimes contradict the objectives of competition law, which favors lower
prices and open markets.

12. To Evaluate the Effectiveness of Current Enforcement Mechanisms

19
 This objective is to analyze how well the enforcement bodies in India—such as the
DGTR for anti-dumping and the CCI for competition law are functioning. It will study whether
their roles are clearly defined, whether they coordinate with each other, and whether they have
the technical and legal capabilities to handle complex trade and competition issues.

13. To Recommend Legal and Policy Reforms to Harmonize Anti-Dumping and

Competition Laws

Based on the analysis, this objective focuses on developing policy suggestions and legal
reforms that could help India harmonize its anti-dumping laws with competition principles.
These may include:

 Mandatory competition impact assessments before imposing duties,

 Greater involvement of CCI in trade remedy cases, and

 Amendments to ensure consumer and innovation protection within the anti-dumping

regime.

14. To Explore Sector-Specific Case Studies for Practical Insight

This objective involves analyzing sector-specific case studies such as steel,

pharmaceuticals, textiles, solar energy, and digital platforms. These sectors frequently face anti-
dumping investigations and competition law challenges. The goal is to study how laws are
applied in different industries and the specific challenges faced in balancing protection and
competition.

15. To Suggest a Future Research Agenda for Scholars and Policymakers

Finally, this research also aims to lay the groundwork for future studies by identifying
unresolved questions and areas that need further empirical or theoretical research. These may
include:

 The need for empirical data on price effects after anti-dumping duties,

 Analysis of consumer loss vs. producer gain, and

 Impact of digital trade on dumping and competition.

20
2.2. Hypothesis

Although anti-dumping laws and competition laws both aim to create fair market
conditions, they often conflict in practice. Anti-dumping measures, while protecting domestic
industries from unfair foreign pricing, can reduce market competition, raise consumer prices, and
protect inefficient firms. On the other hand, competition laws seek to encourage efficiency,
innovation, and consumer welfare. Therefore, without careful coordination, the enforcement of
anti-dumping duties may undermine the broader goals of competition law

2.3. Literature Review :

1. Dumping: A Problem in International Trade (Viner, 1923)

One of the earliest and most influential works on dumping, Viner (1923), conceptualized
dumping as a pricing strategy that could distort international trade. He argued that while some
forms of dumping might benefit consumers in the short run through lower prices, they could
ultimately harm domestic industries, leading to job losses and decreased production. This work
laid the foundation for the justification of anti-dumping laws, emphasizing the need for
regulatory measures to counteract the negative effects of predatory pricing.30

2. Anti-Dumping, Competition, and WTO Law (Bhattacharjea, 2008)

Bhattacharjea (2008) critically examines how anti-dumping measures in India have evolved
as a tool not just for fair competition but also for industrial protection. He highlights how India,
one of the most frequent users of anti-dumping measures, sometimes employs these laws to
shield domestic industries from legitimate competition rather than to counteract unfair trade
practices. The book argues that there is a growing need for greater consistency between India’s
anti-dumping and competition laws to avoid conflicting policy outcomes.31

3. On the Spread and Impact of Anti-Dumping (Prusa, 2001)

Prusa (2001) discusses the global rise of anti-dumping measures and their implications for
market competition. He notes that while anti-dumping laws were originally intended to prevent

30
Viner, J. (1923). Dumping: A Problem in International Trade. University of Chicago Press.
31
Bhattacharjea, A. (2008). Anti-Dumping, Competition, and WTO Law. Oxford University Press.
21
predatory pricing, they have increasingly been used as protectionist tools that limit foreign
competition. The study finds that anti-dumping duties often lead to market distortions, such as
reduced consumer choices and higher prices, rather than fostering fair competition.32

4. Competition Law (Whish & Bailey, 2018)

In their comprehensive book on competition law, Whish & Bailey (2018) explore how
competition laws aim to prevent anti-competitive practices like monopolization, cartelization,
and price-fixing. They argue that anti-dumping measures, despite their intention to protect
domestic industries, can sometimes contradict the principles of competition law by restricting
market entry. The authors advocate for a more balanced approach that ensures anti-dumping laws
do not undermine competition.33

5. Competition Law and the WTO: The Unfinished Agenda (Fox, 2003)

Fox (2003) discusses the role of competition law within the World Trade Organization
(WTO) framework and examines the contradictions between anti-dumping laws and free-market
principles. The book argues that anti-dumping measures should be reformed to align more
closely with competition policies to prevent unnecessary market distortions. Fox suggests that
the WTO should integrate competition law considerations into anti-dumping regulations to create
a more cohesive trade policy framework.34

6. The WTO and Anti-Dumping in Developing Countries (Bown, 2013)

Bown (2013) provides an in-depth analysis of how developing countries, including India, use
anti-dumping laws as a policy tool. He argues that, in many cases, these measures serve the
interests of domestic industries rather than addressing genuine unfair trade practices. Bown
suggests that excessive reliance on anti-dumping laws may reduce market efficiency and create
barriers to competition, ultimately harming consumers.35

7. Antidumping Policy and Competition Law (Neven, 2001)

32
Prusa, T. (2001). On the Spread and Impact of Anti-Dumping. NBER Working Paper.
33
Whish, R., & Bailey, D. (2018). Competition Law. Oxford University Press.
34
Fox, E. (2003). Competition Law and the WTO: The Unfinished Agenda. Journal of International Economic Law.
35
Bown, C. (2013). The WTO and Anti-Dumping in Developing Countries. Brookings Institution.
22
 Neven (2001) explores the relationship between anti-dumping policies and competition law,
highlighting the contradictions between these regulatory frameworks. He argues that competition
law should take precedence over anti-dumping measures because it focuses on long-term market
efficiency rather than short-term industry protection. Neven recommends replacing traditional
anti-dumping policies with stronger competition law enforcement mechanisms to promote fairer
trade practices.36

8. The World Trade Organization: Law, Practice, and Policy (Matsushita,

Schoenbaum & Mavroidis, 2006)

This book provides an extensive overview of WTO trade regulations, including the role of
anti-dumping laws in global trade. The authors argue that while anti-dumping measures offer
temporary relief to domestic industries, they often have long-term negative consequences by
discouraging market competition and innovation. They advocate for stricter guidelines to ensure
that anti-dumping measures do not become tools for protectionism.37

9. Evenett & Vermulst (2005) – Case Study on EU-China Trade Disputes

Evenett & Vermulst (2005) analyze the European Union’s anti-dumping measures against
Chinese steel imports. Their case study reveals that while the EU justified these duties on the
grounds of preventing unfair competition, they ultimately led to reduced market competition and
higher prices for consumers. This study serves as a key example of how anti-dumping laws, if
misused, can lead to unintended economic consequences.38

10. Mehta & Agarwal (2011) – India’s Competition Act and Anti-Dumping Measures

Mehta & Agarwal (2011) examine the implementation of India’s Competition Act, 2002, and
its relationship with anti-dumping measures. They highlight instances where anti-dumping duties
imposed by India contradicted the country’s competition policy objectives. Their analysis
suggests that policymakers need to ensure greater coordination between competition law
enforcement and trade policies to avoid conflicting outcomes.39

36
Neven, D. (2001). Antidumping Policy and Competition Law. World Bank Discussion Paper.
37
Matsushita, M., Schoenbaum, T., & Mavroidis, P. (2006). The World Trade Organization: Law, Practice, and
Policy. Oxford University Press.
38
Evenett, S., & Vermulst, E. (2005). The EU-China Steel Dispute and its Economic Consequences. Journal of Trade
Policy.
23
 11. Hoekman & Mavroidis (2011) – Incorporating Competition Principles into Anti-
Dumping Law

Hoekman & Mavroidis (2011) propose policy recommendations for incorporating

competition law principles into anti-dumping regulations. They argue that anti-dumping
investigations should include competition analysis to assess whether alleged dumping actually
harms market competition. This approach would ensure that anti-dumping measures are applied
only when necessary, rather than being used as a blanket protectionist tool.40

2.4. Scope of Study

This research focuses on examining the legal and economic framework of anti-dumping
laws and their relationship with competition law in India. The study looks closely at how these
two sets of laws work, their objectives, their points of intersection, and the potential conflicts that
may arise when both are applied in the same market. While anti-dumping laws are designed to
protect domestic industries from unfair trade practices by foreign companies, competition laws
are created to ensure that markets remain competitive, consumers have choices, and businesses
do not misuse their market power. The research aims to explore how these two objectives can
sometimes clash, especially when anti-dumping duties reduce competition in the market.

The scope includes a detailed analysis of the legal provisions under the Customs Tariff
Act, 1975, and the Anti-Dumping Rules, 1995, which form the basis of India’s anti-dumping
regime. It also covers the Competition Act, 2002, which governs India’s competition law and is
enforced by the Competition Commission of India (CCI). The study further includes relevant
international frameworks, especially those laid down by the World Trade Organization (WTO),
such as the Anti-Dumping Agreement and Article VI of the General Agreement on Tariffs and
Trade (GATT). These international rules are important as they guide how member countries,
including India, should structure their anti-dumping laws.

An important part of this research is to analyze how anti-dumping and competition laws
interact. The study explores the ways in which the application of anti-dumping duties might limit
competition, increase prices for consumers, or protect inefficient industries. At the same time, it
39
Mehta, P., & Agarwal, M. (2011). India’s Competition Act and Anti-Dumping Measures: A Policy Conflict?. CUTS
Institute.
40
Hoekman, B., & Mavroidis, P. (2011). Trade and Competition Policy Reform: Aligning Anti-Dumping with
Market Principles. Cambridge University Press.
24
evaluates how competition law seeks to ensure fair pricing, prevent monopolies, and encourage
innovation. The research will critically examine this intersection to determine whether both laws
complement each other or work against one another in practice.

While the main focus is on the Indian legal framework, the research also includes
comparative insights from other countries like the United States, European Union, and China.
These comparisons are used to understand how other countries manage the balance between
protecting domestic industries and promoting market competition. Studying international
practices helps to identify possible reforms that India can consider adopting to strengthen its
legal and economic policies.

In addition to legal texts, the research also includes analysis of case studies and judicial
decisions. Real-life examples from sectors such as steel, pharmaceuticals, solar energy, and
textiles are included to show how anti-dumping measures and competition laws have been
applied and what the outcomes were for producers, consumers, and the market overall.

Lastly, the research aims to suggest practical reforms and policy recommendations. These
include encouraging better coordination between the authorities responsible for anti-dumping
and competition law, incorporating competition impact assessments before anti-dumping duties
are imposed, and ensuring that consumer welfare is given due importance. However, the study
does not include detailed statistical analysis or economic modeling and does not cover subsidy
laws or safeguard measures beyond anti-dumping.

2.5. Significance of Research

This research is highly significant because it deals with two important areas of law that
directly affect international trade, market competition, and consumer welfare anti-dumping laws
and competition laws. Both of these legal systems are designed to protect the market, but they
often do so in different ways. Anti-dumping laws are meant to protect domestic industries from
unfair pricing by foreign companies. On the other hand, competition laws are made to ensure that
no single company becomes too powerful, and that all companies compete fairly, leading to
better prices and more choices for consumers.

In today’s globalized economy, countries are increasingly involved in international trade.

While open trade can benefit economies by increasing access to goods and services, it can also
25
pose risks to local industries. One such risk is dumping, where a foreign company sells products
at a very low price sometimes even below production cost to drive out local competitors. To
counter this, countries like India use anti-dumping laws. However, if these laws are used too
aggressively, they may reduce healthy competition and allow domestic companies to increase
prices or lower quality without fear of losing customers. This creates a conflict between anti-
dumping measures and competition law.

This research is significant because it aims to explore and explain this conflict in detail. It
seeks to understand whether these two laws work together or if they end up harming each other’s
purpose. For example, anti-dumping laws may end up protecting companies that are not efficient
or innovative, while competition law encourages efficiency, lower prices, and innovation.
Understanding this relationship is essential for policymakers who need to create trade and market
laws that are balanced and fair.

The research also holds importance for judges, regulators, lawyers, and legal scholars, as
it provides a detailed view of how anti-dumping cases are handled in India, and how they impact
the principles of competition law. It reviews important legal cases, both at the national level and
in international forums like the World Trade Organization (WTO), helping legal experts
understand the practical impact of these laws.

For businesses, the research is significant because it helps them understand the risks and
protections available under anti-dumping and competition laws. It explains how companies can
face legal action if they engage in dumping, but also how they can be affected by competitors
misusing the law for protectionism. Similarly, consumers benefit when policies support fair
pricing and product variety, which this research advocates for.

In short, this research contributes to legal knowledge and policy-making by offering a

comprehensive and balanced view of two very different yet connected areas of law. It provides
recommendations for better coordination between legal frameworks, helping create a system that
protects industries without sacrificing consumer interest or market fairness.

2.6. Limitation of the Research :

While this research offers a detailed analysis of anti-dumping laws and competition law,
and explores their interaction in the Indian and international context, it also has certain
26
limitations. These limitations are important to acknowledge because they define the boundaries
of the study and highlight areas that could be explored further in future research.

The first limitation is that the research is doctrinal and qualitative in nature. This means it
is based mainly on secondary sources, such as laws, rules, regulations, policy documents, judicial
decisions, books, and research papers. While these sources provide valuable insights, the study
does not include empirical data, such as surveys, interviews, or detailed market statistics. As a
result, the research may lack the kind of quantitative evidence that would help in measuring the
actual economic or social impact of anti-dumping measures on market competition, prices, or
consumer welfare.

Another limitation is the geographical scope of the study. The research focuses mainly on
India and its implementation of anti-dumping and competition laws. While there are references
to international frameworks such as the WTO Anti-Dumping Agreement and some comparisons
with countries like the United States, European Union, and China, the study does not go into
deep detail about how these countries manage the intersection of these laws in every sector.
Therefore, the findings may not be fully applicable to countries with different legal systems,
trade policies, or economic conditions.

A further limitation is related to the rapidly changing nature of laws and trade policies.
International trade is influenced by political developments, economic reforms, and global events
like pandemics, wars, and changes in government. Laws are frequently amended or updated to
match current realities. As a result, some of the legal provisions or policies discussed in this
research may change over time, which could affect the relevance of certain conclusions.

Additionally, the research does not focus on related areas of trade law, such as
countervailing duties, safeguard measures, or subsidy disputes, which are also used to protect
domestic industries from unfair trade practices. While these areas are related to anti-dumping
law, they fall outside the scope of this study and are not discussed in detail.

There is also a limitation in terms of economic modeling. The research explains the
effects of dumping and competition law on markets using theoretical and legal analysis.
However, it does not include mathematical models or economic simulations that could have

27
offered more precise insights into the impact of duties on pricing, market share, or consumer
behavior.

Lastly, due to the complexity of international law, it is often difficult to assess the true
intent behind a country’s use of anti-dumping laws whether it is to address genuine unfair trade
or simply to protect domestic industries. This ambiguity can make it challenging to assess
whether anti-dumping measures are fair or misused.

Despite these limitations, the research provides valuable insights and creates a foundation
for future studies that could include empirical, statistical, or industry-specific research.

28
 CHAPTER III

Understanding Dumping and Anti-Dumping Practices

3.1. Meaning of Dumping and Anti- dumping

In the world of international trade, “dumping” is a word used to describe a situation

where a company exports a product to another country at a price that is either lower than the
price it charges in its own domestic market or even below its cost of production. This practice
gives the exporting company an unfair advantage because it can flood a foreign market with
cheaper goods, often harming the local industry in that country.

Dumping is seen as unfair trade because it does not allow a level playing field between
domestic producers and foreign exporters. While consumers in the importing country might
enjoy lower prices at first, in the long run, the domestic industry may suffer. Local producers
may be forced to lower their prices to compete, which can lead to losses, job cuts, factory
closures, and reduced investment in local production.

The World Trade Organization (WTO) defines dumping as follows: "Dumping is, in
general, a situation of international price discrimination, where the price of a product when sold
in the importing country is less than the price of that product in the market of the exporting
country."41

Let’s consider a simple example. Suppose a Chinese manufacturer sells steel in China for
$500 per ton but exports it to India at $300 per ton. If the cost of production is $400, this would
be considered dumping in India because the price is below both the domestic market price and
the cost of production.

3.1.1. Types of Dumping

Economist Jacob Viner, who is considered one of the pioneers in the study of dumping,
identified three key types of dumping in his work:

41
World Trade Organization, Understanding the WTO: Anti-Dumping, Subsidies, Safeguards.
29
 1. Sporadic Dumping: This occurs when a company temporarily lowers its export price to
clear out excess or unsold inventory. The intention is not to capture the market but simply
to dispose of surplus goods.

2. Intermittent Dumping: This happens when a company occasionally lowers export prices
to gain entry into a foreign market. It’s used as a short-term strategy to compete or disrupt
local players.

3. Predatory Dumping: This is the most harmful type. It involves consistently selling
products at very low prices often below cost with the goal of driving competitors out of
the market. Once local firms have shut down, the dumping firm may raise prices and
dominate the market.42

3.1.2. Why Do Companies Dump Goods?

Companies dump goods in foreign markets for various reasons:

 To gain quick access to new markets by undercutting local prices.

 To get rid of surplus or unsold stock from their own markets.

 To increase market share by forcing local competitors to exit.

 Sometimes, due to government subsidies in the exporting country, firms are able to sell
below cost.

Although it may look like a smart business tactic, dumping can hurt the importing country’s
economy, especially its domestic industries and employment levels.

3.1.3. What Is Anti-Dumping?

To fight against dumping and protect their industries, many countries use a legal tool
called anti-dumping law. Anti-dumping measures are trade remedies that allow a country to
investigate whether dumping is taking place, and if so, whether it is harming local industry. If
both conditions are proven, the country can impose anti-dumping duties, which are extra taxes on
those imports. The goal is to raise the price of the dumped product to its fair market value,
allowing local businesses to compete on equal terms.
42
Jacob Viner, Dumping: A Problem in International Trade 3–6 (Univ. of Chicago Press 1923).
30
 These duties are not meant to punish the exporter but to remove the unfair advantage
caused by dumping. The process of imposing anti-dumping duties must follow rules and
procedures set by international agreements and national laws.

Under the World Trade Organization's Anti-Dumping Agreement, dumping is not illegal
unless it causes or threatens to cause "material injury" to a domestic industry in the importing
country.43 That means there must be both evidence of dumping and proof of injury.

3.1.4. Legal Framework for Anti-Dumping

Internationally, anti-dumping is governed by Article VI of the General Agreement on

Tariffs and Trade (GATT) 1994 and the WTO Anti-Dumping Agreement. 44 These agreements lay
down conditions and procedures for conducting anti-dumping investigations and applying duties.

In India, anti-dumping laws are found in:

 Section 9A of the Customs Tariff Act, 1975, which gives the central government power to
impose anti-dumping duties.

 The Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on

Dumped Articles and for Determination of Injury) Rules, 1995, which outline the
procedures to be followed.45

The investigation is carried out by the Directorate General of Trade Remedies (DGTR) under
the Ministry of Commerce. After the investigation, if dumping and injury are established, the
Ministry of Finance imposes the duty based on DGTR’s recommendation.

3.1.5. Objectives of Anti-Dumping Measures

The main goals of anti-dumping actions are:

 To protect domestic producers from unfairly priced imports.

 To ensure fair competition in the market.

43
Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Anti-Dumping
Agreement), Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A, 1868
U.N.T.S. 201.
44
General Agreement on Tariffs and Trade Art. VI, Oct. 30, 1947, 61 Stat. A-11, 55 U.N.T.S. 194.
45
Customs Tariff Act, No. 51 of 1975,Sec9A, India Code (1975); Customs Tariff (Identification, Assessment and
Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, Gazette of
India, Extraordinary, Part II, sec. 3(i) (Jan. 1, 1995).
31
  To maintain employment levels in affected industries.

 To prevent monopolization of the market by foreign firms.

It is important to note that anti-dumping duties are not used against cheap products per se. A
product being cheaper than local alternatives is not illegal. The key factor is whether the product
is being sold below its normal value and whether this is causing injury to the domestic industry.

3.1.6. Impact of Dumping and Anti-Dumping

Positive Impact (if used properly):

 Restores fair competition in the domestic market.

 Encourages local firms to remain in business.

 Prevents monopolistic behavior from foreign firms.

 Promotes domestic production and employment.

Negative Impact (if misused):

 May lead to higher prices for consumers.

 Can protect inefficient domestic industries.

 If used for political reasons, may lead to trade wars.

 May limit consumer choices by restricting imports.

Because of these trade-offs, it is important that anti-dumping actions are used transparently
and fairly, based on factual evidence and economic analysis.

3.2. Effect of Dumping on Competition :

Dumping has significant effects on the competitive structure of a market. While on the
surface it may appear to offer benefits like lower prices for consumers, dumping can also damage
local industries, reduce innovation, and create unfair trade environments. The true impact of
dumping on competition depends on how it is practiced and how countries respond to it.

3.2.1. What Is Competition in the Market?

32
 In a healthy and competitive market, multiple producers both local and international
compete with each other based on quality, price, service, and innovation. This benefits
consumers, who get better choices and fair prices. But dumping can disturb this balance.

When a foreign company sells its goods at an extremely low price lower than their actual
cost or the price in their home market it can hurt local companies that cannot afford to reduce
their prices as much. This creates an unequal and distorted competition.

3.2.2. Short-Term and Long-Term Effects

Short-Term Effects

In the beginning, dumping may look like a good thing for consumers and downstream industries
(those who use the imported goods to make other products). For example:

 Consumers get cheaper goods.

 Manufacturers using imported raw materials benefit from low-cost inputs.

 Market prices may fall temporarily.

But these benefits are often temporary and come with long-term risks.

Long-Term Effects

In the long run, the effects of dumping on competition can be harmful, such as:

1. Domestic Industry Shrinkage: Local businesses may not be able to sell at such low
prices and could be forced to shut down or reduce operations.

2. Job Losses: As local industries suffer, jobs are lost in sectors that are unable to compete
with cheaper imports.

3. Market Exit and Monopolies: If domestic competitors are pushed out, the foreign firm
may later raise prices, having already captured the market. This creates a monopoly-like
situation.

4. Reduced Innovation: When competition is eliminated, firms lose the motivation to

improve product quality or invest in research.

33
3.2.3. Anti-Competitive Nature of Dumping

Dumping is considered anti-competitive when it is used as a strategy to dominate or

control a market rather than simply compete fairly. In such cases, the aim of dumping is not just
to sell more products but to destroy competition.

This is especially dangerous in the case of predatory dumping, where a company sells
goods below cost with the goal of driving out all competitors and then raises the prices once it
has captured the market.46 Such behavior is similar to the kind of market abuse that is restricted
under competition or antitrust laws in most countries.

3.2.3. Case Example: Indian Steel Industry

One real-life example of the impact of dumping on competition is seen in India’s cold-
rolled steel industry. In the early 2000s, cheap imports from countries like China, South Korea,
and Ukraine were sold at very low prices in the Indian market. Indian producers like SAIL and
Tata Steel complained of severe injury and loss of market share. The government imposed anti-
dumping duties after confirming the injury.47

However, this action also had an impact on downstream industries such as:

 Automobile manufacturers, who used the steel in production.

 Construction companies, who faced higher raw material prices.

This example shows that while anti-dumping duties help producers, they can also raise costs for
other businesses and reduce competition further down the supply chain.

3.2.4. Dumping vs. Healthy Price Competition

It’s important to make a distinction between healthy price competition and dumping:

 Healthy competition is when firms reduce prices because they are more efficient.

 Dumping is when prices are lowered artificially, sometimes through government

subsidies, to gain unfair control over a foreign market.
46
Jacob Viner, Dumping: A Problem in International Trade 33–37 (Univ. of Chicago Press 1923).
47
Directorate Gen. of Anti-Dumping & Allied Duties, Ministry of Com. & Indus., Final Findings in Anti-Dumping
Investigation Concerning Imports of Cold Rolled Flat Products of Stainless Steel from China PR, Korea RP,
European Union, South Africa, Taiwan, Thailand and USA (2010).
34
In competition law, pricing below cost is considered harmful only if the goal is to eliminate
competitors. Dumping is different from normal discounting because it is often targeted,
sustained, and strategic, and it ignores long-term effects on the market.

3.2.5. Effect on Consumer Welfare

In the short run, consumers benefit from lower prices. But in the long run, consumer welfare
may decrease because:

 Fewer competitors mean higher prices in the future.

 Monopoly conditions may lead to lower quality and less innovation.

 The economy becomes more dependent on foreign suppliers, which can be risky.48

Therefore, dumping not only affects companies but also undermines the very principles of open
and fair competition.

3.3. India’s Adoption of Anti-Dumping Laws.

3.3.1. Why India Adopted Anti-Dumping Laws

When foreign companies sell products in India at prices lower than what they charge in
their own countries or below the cost of production it can harm Indian industries. These domestic
firms may not be able to compete and might shut down, leading to job losses, industrial
slowdown, and long-term economic damage.

To prevent such unfair situations and to comply with its obligations as a founding member of
the WTO, India incorporated anti-dumping laws in 1995, just after the formation of the WTO.
These laws aim to:

 Protect Indian industries from injury caused by dumped imports.

 Maintain fair competition in Indian markets.

 Align Indian trade policies with WTO rules, particularly Article VI of GATT 1994 and
the WTO Anti-Dumping Agreement.49

48
World Trade Organization, Anti-Dumping: Measures to Protect Against Unfair Trade.
49
General Agreement on Tariffs and Trade Art. VI, Oct. 30, 1947, 61 Stat. A-11, 55 U.N.T.S. 194; Agreement on
Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Anti-Dumping Agreement), Apr.
35
3.3.2. Legal Framework for Anti-Dumping in India

The legal foundation for anti-dumping in India consists of the following key components:

1. Customs Tariff Act, 1975 (Section 9A and 9B)

Section 9A empowers the central government to impose anti-dumping duties on imports

that are sold below their normal value and are causing injury to domestic industry. These duties
are meant to bridge the price gap and allow fair competition.50

Section 9B allows the government to suspend or terminate anti-dumping duties in certain

situations, such as when conditions change or if the exporter agrees to revise prices voluntarily.

2. Anti-Dumping Rules, 1995

The full title is the Customs Tariff (Identification, Assessment and Collection of Anti-
Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995. These rules
outline:

 Who can file a complaint,

 How investigations are to be conducted,

 How to determine whether injury has occurred, and

 What steps must be taken before imposing duties.51

These rules follow the WTO’s Anti-Dumping Agreement closely and ensure transparency and
fairness in the investigation process.

3.3.3. Institutional Mechanism: Who Does What?

Several government bodies are involved in India's anti-dumping process:

1. Directorate General of Trade Remedies (DGTR)

The DGTR is the investigative authority for anti-dumping cases. It works under the Ministry
of Commerce and Industry. The DGTR is responsible for:
15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A, 1868 U.N.T.S. 201.
50
Customs Tariff Act, No. 51 of 1975, S 9A–9B, India Code (1975).
51
Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for
Determination of Injury) Rules, 1995, Gazette of India, Extraordinary, Part II, sec. 3(i) (Jan. 1, 1995).
36
  Receiving complaints from domestic industry,

 Conducting investigations to determine dumping and injury,

 Holding hearings and collecting data,

 Making recommendations to impose or not impose anti-dumping duties.52

2. Ministry of Finance

Once the DGTR recommends anti-dumping duties, the Department of Revenue (under
the Ministry of Finance) makes the final decision. It can accept, modify, or reject the
recommendation and is responsible for issuing the official notification and collecting the duties.

3.3.4. How the Process Works

Here’s a simplified step-by-step process for how anti-dumping measures are adopted in India:

1. Filing a Petition: An Indian producer or industry group files a complaint with the DGTR.

2. Initiation of Investigation: If the DGTR finds enough preliminary evidence, it begins a

formal investigation.

3. Data Collection and Analysis: Both Indian and foreign producers are asked to provide
data on pricing, production, exports, and profits.

4. Public Hearings: Interested parties may present their views.

5. Findings and Recommendations: The DGTR publishes its final findings and
recommends whether anti-dumping duties should be imposed.

6. Final Decision: The Ministry of Finance decides whether to impose duties and issues a
notification if approved.

This process usually takes 6 to 12 months, but provisional duties can be imposed earlier if
there is immediate danger to domestic industry.

3.3.5. India's Role as a Leading User of Anti-Dumping Measures

52
Directorate General of Trade Remedies, Ministry of Commerce & Industry.
37
 Since 1995, India has filed hundreds of anti-dumping cases, especially against countries
like China, South Korea, and the European Union. Many of these cases involve steel, chemicals,
plastics, electronics, pharmaceuticals, and textiles.53

India's frequent use of anti-dumping duties shows how important these measures are for
protecting growing industries in a developing economy. However, it also raises questions about
whether some duties are being used for protectionist purposes, especially when no real injury can
be proven.

3.4. What Are Anti-Dumping Measures?

Anti-dumping measures usually involve import duties special taxes applied to specific
products imported from specific countries. These duties are designed to increase the price of the
dumped product so that it is more in line with the fair market value or “normal value” of the
product.54 This helps protect local manufacturers who may otherwise be forced out of the market
due to artificially low-priced imports.

In India, these measures are governed by:

 Section 9A of the Customs Tariff Act, 1975, and

 Anti-Dumping Rules, 1995.55

3.4.1. Objectives of Anti-Dumping Measures

The main goals of anti-dumping measures are:

1. To protect domestic industry from material injury due to unfairly priced imports.

2. To maintain healthy market competition by discouraging predatory pricing.

3. To ensure a level playing field in international trade.

53
World Trade Organization, Statistics on Anti-Dumping Measures
54
Commissioner of Customs v. G.M. Exports, (2015) 324 E.L.T. 209 (S.C.) (India).
55
Customs Tariff Act, No. 51 of 1975, S 9A, India Code (1975); Customs Tariff (Identification, Assessment and
Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, Gazette of
India, Extraordinary, Part II, sec. 3(i).
38
 It’s important to note that selling at low prices is not illegal unless it causes injury and meets
the definition of dumping under WTO rules. That’s why anti-dumping measures are applied only
after a thorough investigation.

3.4.2. Types of Anti-Dumping Measures

India’s legal framework allows several types of anti-dumping responses depending on the
stage of the investigation and the nature of the dumping activity:

1. Provisional Measures

These are temporary duties imposed during the investigation stage if the investigating
authority (DGTR) finds sufficient preliminary evidence of dumping and injury.56

 They are imposed to prevent further harm while the investigation is ongoing.

 Valid for an initial period of 6 months, extendable up to 9 months.

2. Definitive Anti-Dumping Duties

These are long-term duties imposed after the final findings of the DGTR confirm that
dumping is taking place and that it is harming the domestic industry.

 Typically, valid for five years.

 Can be reviewed or extended upon application.

 The duties may be specific (fixed amount per unit) or ad valorem (percentage of the
import value).57

3. Price Undertakings

In some cases, instead of paying anti-dumping duties, the foreign exporter may offer a price
undertaking a voluntary commitment to raise export prices to a fair level or limit the volume of
exports.58

 If accepted by the DGTR, the investigation may be suspended or terminated.

56
Id. r. 13.
57
Id. r. 18.
58
Id. r. 15.
39
  Price undertakings must fully eliminate injury to be considered valid.

4. Retrospective Imposition of Duties

In rare cases, anti-dumping duties can be applied retroactively:

 Only when there is a history of dumping or massive imports in a short period that cause
sudden injury.

 Retrospective duties can cover up to 90 days before the date of provisional duties.59

5. Sunset and Mid-Term Reviews

 Duties usually expire after five years unless reviewed.

 The DGTR may conduct sunset reviews to determine whether ending the duty will lead to
continued dumping and injury.

 Mid-term reviews can also be done if there is a change in market conditions, pricing, or
injury patterns.

3.4.3. How Are Measures Calculated?

The key figure used to calculate anti-dumping duties is the dumping margin—the
difference between the product’s normal value and the export price.

For example:

 If the normal value is ₹100 and the export price is ₹70, the dumping margin is ₹30.

 An anti-dumping duty of ₹30 may then be imposed to correct the price gap.

The WTO and Indian rules require a causal link between dumping and injury, and the injury
must be material not just minor losses or competition.60

3.4.4. Implementation in India

59
Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Anti-Dumping
Agreement), Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A, art. 10.6,
1868 U.N.T.S. 201.
60
Id. art. 3.5.
40
 The Directorate General of Trade Remedies (DGTR) conducts the investigations. Once
DGTR makes a recommendation, the Ministry of Finance (Department of Revenue) issues the
final notification for imposing duties.

This two-step process ensures that:

 Investigation remains independent, and

 Final decision rests with the executive branch for broader policy considerations.

3.5. Types of Anti-dumping measures:

Anti-dumping laws provide governments with several tools to fight against unfair trade
practices. These tools are not “one-size-fits-all”; instead, they are tailored to match the nature,
seriousness, and impact of dumping in each case. Based on international trade rules, especially
the World Trade Organization (WTO) Anti-Dumping Agreement, and India’s domestic legal
system, countries can apply different types of anti-dumping measures depending on the situation.

1. Provisional Measures

A provisional measure is a temporary anti-dumping duty imposed during the early stage
of the investigation. It is applied only after the investigating authority (DGTR in India) finds
enough initial evidence to suggest:

 Dumping is occurring,

 There is material injury to the domestic industry, and

 There is a need to prevent further injury while the investigation is ongoing.61

Key Features:

 Imposed by the Ministry of Finance based on recommendation from DGTR.

 Usually applied after 60 days of investigation.

61
Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for
Determination of Injury) Rules, 1995, r. 13, Gazette of India, Extraordinary, Part II, sec. 3(i).
41
  Valid for an initial period of 6 months, extendable up to 9 months.

 Can be specific (fixed amount per unit) or ad valorem (percentage of import value).

Provisional measures protect domestic producers from immediate harm while a full
investigation continues. However, if the final outcome does not confirm dumping, these duties
are refunded.

2. Definitive Anti-Dumping Duties

Definitive duties are the final and formal anti-dumping measures imposed after a full
investigation confirms the following:

 Dumped goods are entering the market,

 The dumping is causing or threatening material injury,

 There is a clear causal link between dumping and injury.62

Key Features:

 Imposed by notification from the Ministry of Finance.

 Typically valid for five years.

 Can be extended if dumping and injury still exist.

 May be specific or ad valorem depending on how the dumping margin is calculated.

These duties help restore fair competition in the market and give local industries the chance
to recover and stabilize.

3. Price Undertakings

A price undertaking is a voluntary offer by the exporter to revise export prices or limit the
quantity of dumped products to avoid anti-dumping duties.63

62
Id. r. 18.
63
Id. r. 15.
42
Instead of continuing the investigation or imposing duties, the Indian authority (DGTR) may
accept the price commitment if:

 The undertaking completely removes the injury to the domestic industry, and

 It is practical to monitor and enforce the price commitment.

Key Features:

 Undertakings are optional and based on agreement between exporter and DGTR.

 Investigation may be suspended or terminated if the undertaking is accepted.

 Exporters must submit periodic data to show compliance.

These measures are less confrontational and may be preferable in diplomatic or sensitive trade
relationships.

4. Retrospective Duties

Anti-dumping duties are generally not retroactive. However, in rare and serious cases, the
WTO allows countries to apply duties on past imports to stop abuse of the process.64

Conditions for Retrospective Imposition:

 There is a history of dumping causing injury.

 There is massive dumping in a short period before the duty was imposed.

 The injury to the domestic industry is serious and immediate.

Scope:

 Duties can apply to imports that arrived up to 90 days before the provisional duties were
imposed.65
64
Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Anti-Dumping
Agreement), Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A, art. 10.6,
1868 U.N.T.S. 201.
65
Id. art. 10.
43
Retrospective duties are used sparingly, as they can disrupt trade flows and lead to disputes.

5. Sunset and Mid-Term Reviews

While not “types” of duties themselves, these review mechanisms are important in
managing how long anti-dumping measures remain in force.

Sunset Reviews:

 Conducted just before the 5-year expiry of a definitive duty.

 Used to assess whether removing the duty would lead to continued or renewed dumping
and injury.

 If yes, the duty may be extended for another 5 years.

Mid-Term Reviews:

 Can be initiated at any time if there is a significant change in circumstances.

 Requested by importers, exporters, or domestic producers.

 May result in modification, continuation, or termination of duties.66

Reviews ensure that anti-dumping measures remain fair, relevant, and necessary over time.

3.6. Misuse and Criticisms and Anti-Dumping Measures

Anti-dumping measures are important legal tools that help countries protect their
domestic industries from unfair trade practices like the import of products at artificially low
prices. However, these measures are often criticized for being misused not to protect fair
competition, but to provide excessive protection to domestic industries. Critics argue that, in
many cases, anti-dumping laws are not used to stop unfair trade, but rather to keep out foreign
competition, even when that competition is fair and legal.

3.6.1. Misuse of Anti-Dumping Laws

Although anti-dumping laws are intended to prevent injury from unfair pricing, they are
sometimes used strategically by domestic companies or interest groups to:

66
Id. art. 11; see also Customs Tariff Rules, 1995, rr. 23–24.
44
 1. Avoid competition from cheaper but legitimate imports.

2. Maintain high prices by keeping out low-cost suppliers.

3. Delay innovation or efficiency improvements by relying on legal protection instead of

improving competitiveness.

In such cases, anti-dumping actions act as a disguised form of protectionism, which goes
against the principles of free trade and market fairness.67

3.6.2. Common Criticisms

 Lack of Focus on Consumer Welfare

One of the biggest criticisms is that anti-dumping investigations are focused only on
producer interests. The law looks at whether domestic manufacturers are suffering injury, but it
does not consider how anti-dumping duties affect consumers.

For example, if duties are imposed on cheap imported solar panels, it may help Indian
manufacturers, but it will also increase the cost of renewable energy for consumers and slow
down national solar targets.68

 Encouragement of Inefficiency

Another criticism is that inefficient or outdated industries may use anti-dumping

complaints to avoid making necessary improvements. If these firms are protected from
competition, they may not innovate or modernize, which harms the economy in the long run.

67
World Trade Organization, Anti-Dumping Measures: Procedures and Practices, World Trade Organization, Anti-
Dumping Measures: Procedures and Practices
68
Mehta & Agarwal, India’s Competition Act and Anti-Dumping Measures (CUTS International, 2011).
45
 This becomes particularly problematic in developing countries, where industries should
be encouraged to become globally competitive, not dependent on legal protection.69

 Overuse and Political Influence

Many experts point out that anti-dumping laws are sometimes used too often, especially
in response to political pressure from large companies or industry lobbies. This has been seen in
India, which is one of the world’s top users of anti-dumping duties.70

Instead of being a neutral trade remedy, anti-dumping has in some cases become a policy
weapon used to protect powerful business interests, even when no real injury exists.

3.6.3. Views from Economists and Legal Scholars

Economists have been strongly critical of how anti-dumping laws are written and used:

 Michael Finger, a well-known economist, famously called anti-dumping “stupid

economics, unprincipled law, and trouble-making diplomacy.”71

 Richard Dale argued that if anti-dumping measures were truly limited to preventing
predatory pricing, most of them would not be justified.72

 Evenett and Vermulst studied cases in the European Union and found that consumer harm
was often ignored, and that many duties were simply protecting inefficient producers.73

These views show that anti-dumping law, as practiced, is often out of step with the goals of
competition law, which is designed to protect consumers and encourage efficient markets.

3.6.4. Conflict with Competition Law

Anti-dumping measures can clash with competition law. While competition law tries to
promote low prices and market access, anti-dumping law often penalizes low prices.

69
Aditya Bhattacharjea, Anti-Dumping, Competition, and WTO Law 47–50 (Oxford Univ. Press 2008).
70
World Trade Organization, Statistics on Anti-Dumping,
71
J. Michael Finger, The Origins and Evolution of Anti-Dumping Regulation, 23 World Econ. 121 (2000).
72
Richard Dale, Anti-Dumping Law in a Liberal Trade Order 19–24 (Macmillan Press 1980).
73
Simon J. Evenett & Edwin Vermulst, The Politicisation of EC Anti-Dumping Policy: Member States, Their Votes
and the European Commission, 23 Eur. J. Pol. Econ. 4 (2007).
46
 For example, a foreign company may offer lower prices due to greater efficiency or scale
—but under anti-dumping rules, these prices may be seen as "unfair" if they hurt domestic
producers, even if no intent to harm exists.

This leads to a contradiction:

 Competition law encourages price cuts if they help consumers.

 Anti-dumping law may punish those same price cuts if they hurt domestic producers.

This contradiction creates legal confusion and may result in economic inefficiency. 74

3.6.5. Case Example: India’s Solar Panel Dispute

In 2014 and 2018, India imposed duties on solar panels from China, Malaysia, and Taiwan.
The goal was to protect Indian panel manufacturers. However, developers of solar power plants
strongly opposed these duties, arguing that they would:

 Increase costs of solar energy,

 Slow down clean energy adoption, and

 Hurt public interest and consumers.75

This case shows how well-meaning anti-dumping actions can have negative side effects on the
economy and society.

3.7. Legal Basis For Anti-Dumping Measures

Anti-dumping laws do not exist in isolation. They are based on a combination of

international rules, national legislation, and judicial interpretation. The legal foundation ensures
that countries apply anti-dumping measures in a fair, transparent, and rules-based manner. In

74
Damien J. Neven, Competition, Anti-Dumping, and Trade Remedies, 15 World Econ. 873, 879–81 (2001).
75
Directorate General of Trade Remedies, Ministry of Commerce & Industry, Final Findings in Anti-Dumping
Investigation on Solar Cells and Modules (2018).
47
India, the anti-dumping framework is shaped by both the World Trade Organization (WTO) rules
and domestic statutes like the Customs Tariff Act, 1975 and Anti-Dumping Rules, 1995.

1. International Legal Framework

WTO Rules: Article VI of GATT and Anti-Dumping Agreement

The global legal basis for anti-dumping measures comes from:

 Article VI of the General Agreement on Tariffs and Trade (GATT), 1994, and

 The WTO Anti-Dumping Agreement, officially known as the Agreement on

Implementation of Article VI of GATT 1994.76

 Key Principles Under WTO Rules:

1. Definition of Dumping: Exporting a product at a price lower than its “normal value”
(usually the price in the exporter's domestic market).

2. Conditions for Duty:

o Dumping must occur.

o There must be material injury (or threat of it) to a domestic industry.

o There must be a causal link between dumping and injury.

3. Due Process:

o Investigations must follow objective and transparent procedures.

o Exporters must be given a chance to participate and respond.

o Provisional and definitive measures must be reviewed periodically.

The WTO Anti-Dumping Agreement also places time limits on investigations and duties,
ensures judicial review of decisions, and prohibits arbitrary or excessive protectionism. 77

2. Indian Legal Framework

76
General Agreement on Tariffs and Trade art. VI, Oct. 30, 1947, 61 Stat. A-11, 55 U.N.T.S. 194.
77
Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (Anti-Dumping
Agreement), Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A, arts. 1–18,
1868 U.N.T.S. 201.
48
 India, as a founding member of the WTO, has incorporated its international obligations
into domestic law. The legal instruments for anti-dumping in India include:

a. Customs Tariff Act, 1975 (Section 9A and 9B)

 Section 9A gives the Central Government the authority to impose anti-dumping duties
when goods are being imported at unfair prices and are causing injury to domestic
industry.78

 It sets out how to calculate the dumping margin and determines the period and nature of
duties.

 Section 9B allows the removal or suspension of duties under special conditions (like
price undertakings or public interest).

b. Anti-Dumping Rules, 1995

Formally titled the Customs Tariff (Identification, Assessment and Collection of Anti-
Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, these rules
were enacted to:

 Provide procedures for filing complaints,

 Define how to determine normal value and export price,

 Lay out how to conduct injury investigations, and

 Allow for reviews and appeals.79

These rules ensure that India’s actions are consistent with WTO obligations, while still giving
the government flexibility to respond to unfair trade.

3. Institutional Authorities

India has also created specific institutions to manage anti-dumping actions:

a. Directorate General of Trade Remedies (DGTR)

78
Customs Tariff Act, No. 51 of 1975,Sec9A, India Code (1975).
79
Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for
Determination of Injury) Rules, 1995, Gazette of India, Extraordinary, Part II, sec. 3(i).
49
The DGTR, under the Ministry of Commerce, is the investigating authority. It handles:

 Receipt and screening of complaints,

 Data collection and verification,

 Public hearings and stakeholder engagement,

 Recommendation of provisional or final duties.

b. Ministry of Finance (Department of Revenue)

The Ministry of Finance makes the final decision to impose duties based on DGTR
recommendations. It also issues the official notifications in the Gazette of India.

This two-tier system ensures both technical expertise (DGTR) and policy oversight
(Finance Ministry).

4. Judicial Interpretation and Review

Indian courts have played a role in interpreting anti-dumping laws. The Supreme Court and
High Courts have emphasized that anti-dumping duties:

 Are remedial, not punitive,

 Must follow principles of natural justice, and

 Must be based on evidence and procedure, not political considerations.

In Commissioner of Customs v. G.M. Exports, the Supreme Court of India ruled that anti-
dumping laws must be interpreted in line with WTO rules and international obligations.80

Courts have also held that the DGTR and Finance Ministry must act in accordance with
principles of transparency and reasonableness, and that affected parties should have the right to
challenge decisions through judicial review.

5. Interaction with Other Indian Laws

80
Commissioner of Customs v. G.M. Exports, (2015) 324 E.L.T. 209 (S.C.) (India)
50
 Anti-dumping laws sometimes overlap or conflict with other legal frameworks, especially
competition law under the Competition Act, 2002. While competition law aims to keep prices
low and protect consumers, anti-dumping law can result in higher prices by restricting cheaper
Imports.

Therefore, legal scholars suggest that better coordination is needed between the DGTR
and the Competition Commission of India (CCI) to prevent policy contradictions.81

CHAPTER IV

UNDERSTANDING COMPETITION LAW AND IT’S ROLE

4.1. Competition Law and It’s Evolution

Competition is the foundation of any healthy and growing market economy. It pushes
businesses to offer better quality products, lower prices, and more choices for consumers.
However, not all companies compete fairly. Some use their power to control markets, eliminate
rivals, or fix prices. That’s where competition law comes in it helps ensure that markets stay
open, fair, and competitive.

Competition law, also known in some countries as antitrust law, is a legal framework
designed to prevent unfair trade practices, protect consumer interests, and promote economic
efficiency. This section explores what competition law is and how it has evolved globally and in
India.

4.1.1. What is Competition Law?

Competition law is a set of rules that prevents companies from using unfair methods to
dominate the market. It encourages businesses to compete based on their efficiency, innovation,
and service quality, instead of using unethical or monopolistic tactics.

The three main goals of competition law are:

81
Aditya Bhattacharjea, Anti-Dumping, Competition, and WTO Law 102–110 (Oxford Univ. Press 2008).
51
 1. Prevent Anti-Competitive Agreements – Such as price fixing or market sharing.

2. Stop Abuse of Dominance – For example, when a large company uses its power to crush
smaller competitors.

3. Regulate Mergers and Acquisitions – To ensure that mergers do not create monopolies
that harm consumers.82

By achieving these goals, competition law promotes consumer welfare, economic growth, and
innovation.

4.1.2. Historical Evolution of Competition Law – Global Perspective

United States

The first modern competition law was introduced in the United States through the Sherman
Antitrust Act of 1890.83 This law aimed to break up monopolies and stop companies from
forming cartels. It was followed by:

 Clayton Act (1914) – Controlled mergers and unfair trade practices.

 Federal Trade Commission Act (1914) – Created the FTC, a body to enforce antitrust
laws.

These laws laid the foundation for modern antitrust regulation, and the U.S. continues to play
a leading role in global competition enforcement.

European Union

The European Union (EU) adopted competition law through the Treaty of Rome (1957), now
part of the Treaty on the Functioning of the European Union (TFEU). Articles 101 and 102 of the
TFEU:

 Prohibit anti-competitive agreements (Art. 101),

 Prohibit abuse of dominant position (Art. 102).84

82
Competition Act, No. 12 of 2003, Sec 3–6, India Code (2003).
83
Sherman Antitrust Act, 15 U.S.C. Sec 1–7 (1890).
84
Consolidated Version of the Treaty on the Functioning of the European Union Arts. 101–102, Oct. 26, 2012, 2012
O.J. (C 326) 47.
52
 The European Commission enforces these rules and can impose large fines on companies that
violate them, even if the companies are not based in the EU but operate within its markets.

4.1.3. The Indian Experience: From MRTP Act to Competition Act

1. The MRTP Act, 1969

India’s first competition law was the Monopolies and Restrictive Trade Practices (MRTP)
Act, passed in 1969. It aimed to:

 Control monopolies,

 Prevent unfair trade practices,

 Stop concentration of economic power in a few hands.

However, the MRTP Act had serious limitations:

 It focused more on regulating size of companies rather than behavior.

 It lacked tools to deal with modern market realities, like digital monopolies or global
cartels.

 It did not address mergers and combinations effectively.

The Act was more restrictive than pro-competition, and with the liberalization of India’s
economy in the 1990s, it became outdated.85

2. The Competition Act, 2002

To align Indian law with global standards and meet the needs of a market-driven
economy, India passed the Competition Act, 2002. 86 This law replaced the MRTP Act and created
a more modern, balanced, and economic-based system.

Key features of the Competition Act include:

 Focus on market behavior, not just company size.

 Creation of the Competition Commission of India (CCI) as an independent regulator.

85
Monopolies and Restrictive Trade Practices Act, No. 54 of 1969, India Code (1969) (repealed 2009).
86
Competition Act, No. 12 of 2003, India Code (2003).
53
  Modern tools to assess market structure, economic impact, and consumer harm.

 Alignment with WTO rules and international best practices.87

The Act empowers the CCI to investigate, penalize, and even stop business practices or
mergers that harm competition in India.

4.2. Objectives of Competition Law

Competition law is not only about stopping monopolies or punishing companies. It serves
a much broader purpose. Its main goal is to create and maintain a fair and competitive market
where businesses can grow, new firms can enter, and consumers get access to better products at
reasonable prices. In short, competition law helps build an economy that is efficient, innovative,
and consumer-friendly.

1. Promoting and Sustaining Market Competition

The most important aim of competition law is to promote and preserve competition in all
markets. Competition encourages businesses to:

 Lower prices,

 Improve product quality,

 Innovate new technologies, and

 Offer better customer service.

If a few firms dominate a market without competition, they can become lazy, increase prices,
or reduce product options. Competition law makes sure that no business misuses its power to
block other players from entering or staying in the market.88

2. Preventing Anti-Competitive Practices

Competition law actively prohibits anti-competitive agreements and abuse of dominance.

Some business practices may look normal but are actually harmful to the market. These include:

 Cartels (companies secretly agreeing to fix prices),

87
Ministry of Corporate Affairs, Report of the High Level Committee on Competition Policy and Law (2000).

88
Competition Act, No. 12 of 2003,Sec18, India Code (2003).
54
  Market allocation (companies dividing the market among themselves),

 Bid rigging (manipulating prices during tenders),

 Predatory pricing (selling below cost to kill rivals).

By banning such activities, competition law ensures that businesses win through fair
competition, not manipulation.89

3. Protecting Consumer Welfare

A strong focus of competition law is to protect consumers. When firms compete, consumers
benefit in several ways:

 Lower prices due to price competition,

 Higher quality products,

 More innovation and variety.

On the other hand, when firms collude or monopolize a market, consumers face high prices,
fewer choices, and stagnant product quality. The Competition Act, 2002 includes “protection of
the interests of consumers” as one of its main goals.90

4. Encouraging Economic Efficiency and Innovation

Competition law creates an environment where firms must improve their efficiency and
innovate in order to survive. Without competition, companies may continue with old technology
and outdated business methods.

Efficient companies can reduce costs and improve their processes. Innovation leads to
better goods, new services, and progress in sectors like healthcare, technology, and energy.91

In this way, competition law drives overall economic development and helps a country
remain competitive in global markets.

5. Ensuring Freedom of Trade

89
Id. Sec 3–4.
90
Id.
91
OECD, The Objectives of Competition Law and Policy: Background Note by the Secretariat (2003).
55
 Another key objective is to promote freedom of trade and access to markets. Large firms
with monopoly power can block new or smaller players by controlling distribution channels,
prices, or raw materials.

Competition law ensures that all businesses—small, medium, and large—get a fair
chance to succeed. This is especially important in developing economies like India, where
encouraging small businesses is vital for inclusive growth.92

6. Regulating Mergers and Acquisitions

Sometimes, companies merge or acquire others to grow. While mergers can lead to
economic benefits, they can also reduce competition if too much market power is concentrated in
one company.

Competition law reviews such deals to check if they will lead to:

 A monopoly,

 Dominance in key sectors, or

 Harm to consumer interest.

By monitoring mergers and acquisitions, the law ensures that the market remains open and
competitive even after corporate restructuring.93

7. Aligning with International Standards

Modern competition laws also aim to align with global norms, especially as businesses
today operate across borders. India’s Competition Act, 2002, follows international best practices
and reflects the principles found in laws from countries like the United States and the European
Union.

This alignment helps ensure that Indian firms can compete fairly in global markets and
that India attracts foreign investment by maintaining a transparent and predictable legal system. 94

92
United Nations Conference on Trade and Development, Model Law on Competition, U.N. Doc.
TD/RBP/CONF.7/L.1/Rev.5 (2020).
93
Competition Act, No. 12 of 2003, Sec 5–6, India Code (2003).
94
Ministry of Corporate Affairs, Report of the High Level Committee on Competition Policy and Law (2000).
56
4.3. Key Provisions of Competition Law

The Competition Act, 2002 is India’s primary law to promote and protect competition in
the market. It replaced the older Monopolies and Restrictive Trade Practices Act, 1969 (MRTP
Act), which was more focused on preventing economic concentration rather than encouraging
market efficiency.

The Competition Act introduced a modern framework based on global best practices, and it
focuses on market behavior, consumer welfare, and economic efficiency.

1. Anti-Competitive Agreements – Section 3

What It Prohibits:

Section 3 of the Competition Act prohibits agreements between enterprises or individuals

that may cause or are likely to cause an “appreciable adverse effect on competition” (AAEC) in
India.95

Agreements covered include:

 Cartels (agreements to fix prices, limit production, or share markets),

 Bid rigging (collusive tendering),

 Resale price maintenance, and

 Exclusive supply or distribution agreements.

These are often considered “per se” violations meaning that they are presumed to harm
competition without needing detailed economic analysis.

Horizontal vs. Vertical Agreements:

 Horizontal agreements occur between competitors at the same level (e.g., two
manufacturers fixing prices).

95
Competition Act, No. 12 of 2003,Sec3, India Code (2003).
57
  Vertical agreements occur between firms at different levels (e.g., manufacturer and
distributor).

While horizontal agreements are more strictly regulated, vertical ones are also reviewed if
they affect competition.

2. Abuse of Dominant Position – Section 4

Section 4 deals with abuse of dominance. Being dominant in a market is not illegal, but
using that dominance unfairly is.96

Dominant Position means:

A company has the power to operate without facing significant competition, giving it the
ability to influence prices, supply, or conditions in the market.

Abuses Covered Under Section 4:

 Charging unfair or discriminatory prices,

 Limiting production or technical development,

 Refusing to deal or deny market access,

 Tying unrelated products or services.

The Competition Commission of India (CCI) examines such cases by analyzing market
share, financial strength, vertical integration, and other factors to determine dominance and
misuse.

3. Regulation of Combinations – Sections 5 and 6

Large mergers, acquisitions, and amalgamations are called “combinations” under the
Competition Act. Sections 5 and 6 regulate these to prevent the creation of monopolies or
reduction in competition.97

Combination Includes:
96
Id. Sec4.
97
Id. Sec 5–6.
58
  Acquisition of control, shares, or assets,

 Mergers between companies,

 Amalgamations resulting in a new entity.

If a combination crosses the threshold values set under the law (based on assets or turnover),
the parties must notify the CCI before completing the transaction.

CCI’s Role:

 Reviews whether the combination causes or is likely to cause AAEC in India,

 Approves, modifies, or blocks the deal,

 Decision must be made within 210 days, or it is deemed approved.98

This ensures that market structure is not harmed, and consumers are not affected by reduced
choices or higher prices.

4. Competition Advocacy – Section 49

Competition law is not only about punishing wrongdoers; it also aims to educate, advise,
and encourage good practices.

Under Section 49, the CCI promotes competition by:

 Advising the government on policies that may affect competition,

 Publishing research and reports,

 Conducting public awareness programs.

This provision ensures that laws and government policies themselves do not unintentionally
harm market competition.99

5. Penalties and Enforcement

The Act gives the CCI the power to:

 Investigate complaints (on its own or through the Director General),

98
Id. Sec31.
99
Id. Sec49.
59
  Impose penalties, including fines up to 10% of turnover for companies and three times
profits for cartels,

 Pass cease-and-desist orders, or direct changes in behavior.

Appeals can be made to the National Company Law Appellate Tribunal (NCLAT) and then to the
Supreme Court of India.100

Case Example: Cement Cartel Case (2012)

In a major case, the CCI imposed a fine of over ₹6,300 crore on 11 cement companies for
forming a cartel and artificially controlling supply to raise prices. The companies were found
guilty of violating Section 3 of the Act. This case highlighted the effectiveness of CCI in
identifying and penalizing cartel behavior.101

4.4. International Perspective of Competition Law

Competition law is not just a national concern—it has become an important part of
international economic policy. As companies increasingly operate across borders, anti-
competitive behavior in one country can have global effects. This is why many nations have
enacted competition laws, and why international cooperation in this area is growing.

4.4.1. Why International Competition Law Matters

In today’s global economy, companies may:

 Collude across borders,

 Merge with foreign competitors,

 Abuse their dominance in global supply chains.

Because of this, anti-competitive practices can no longer be controlled by a single country

alone. If there is no cooperation or consistency in competition laws, businesses could exploit
legal loopholes in one country while harming consumers and markets in another.

100
Id. Sec 26–27, 53B.
101
Builders Ass’n of India v. Cement Mfrs. Ass’n & Others, Case No. 29/2010, Order dated June 20, 2012 (CCI).
60
 Therefore, countries must align their laws and enforcement efforts to maintain market
fairness and economic integrity globally.102

4.4.2. Major Competition Law Jurisdictions

1. United States

The United States has one of the oldest and most influential competition law regimes. The
foundation of U.S. antitrust law includes:

 Sherman Antitrust Act, 1890 – Prohibits monopolies and cartels.103

 Clayton Act, 1914 – Controls mergers and addresses price discrimination.104

 Federal Trade Commission (FTC) Act, 1914 – Establishes the FTC to enforce
competition and consumer protection laws.

The U.S. approach is primarily focused on consumer welfare—looking at whether business

behavior harms consumers through higher prices, reduced choices, or lower quality.

2. European Union

The European Union has a highly developed competition law framework through:

 Article 101 of the Treaty on the Functioning of the European Union (TFEU) –
Prohibits anti-competitive agreements.105

 Article 102 TFEU – Prohibits abuse of a dominant market position.

 The European Commission is the main enforcement authority.

The EU takes a broader view than the U.S., considering not just prices but also market
structure, innovation, and the ability of smaller firms to compete.

3. United Kingdom

102
Eleanor M. Fox, Antitrust and Global Market Integration: The Asian Experience, 72 Antitrust L.J. 479 (2005).
103
Sherman Antitrust Act, 15 U.S.C. Sec 1–7 (1890).
104
Clayton Act, 15 U.S.C. Sec 12–27 (1914).
105
Consolidated Version of the Treaty on the Functioning of the European Union Arts. 101–102, Oct. 26, 2012, 2012
O.J. (C 326) 47.
61
 After Brexit, the UK maintains its own regime under the Competition Act 1998, enforced
by the Competition and Markets Authority (CMA). 106 The UK system is closely aligned with the
EU but allows for independent decisions in cross-border mergers and conduct cases.

4.4.3. Global Spread of Competition Laws

More than 140 countries now have competition laws. Many developing countries—
including India, Brazil, South Africa, and Mexico—have adopted modern legislation to control
domestic monopolies and regulate the behavior of multinational firms operating in their
markets.107

These laws are shaped by:

 Economic conditions,

 Political systems,

 Legal traditions, and

 Trade priorities.

However, they all share common goals: protect consumers, ensure fairness, and prevent
abuse of market power.

4.4.4. Role of International Organizations

Several international bodies play a key role in encouraging cooperation and setting
standards for competition law globally.

1. United Nations Conference on Trade and Development (UNCTAD)

UNCTAD promotes competition in developing countries and provides:

 Technical assistance,

 Model laws,

 Guidelines for enforcement.108

106
Competition Act 1998, c. 41 (UK).
107
UNCTAD, Voluntary Peer Review of Competition Law and Policy: Philippines (2019).
108
UNCTAD, Model Law on Competition (2020).
62
2. Organisation for Economic Co-operation and Development (OECD)

The OECD helps develop policy tools, conducts research, and facilitates cooperation
between developed and emerging economies. Its Competition Committee publishes studies and
recommendations.109

3. International Competition Network (ICN)

The ICN is a voluntary network of competition agencies from over 130 countries. It focuses
on:

 Sharing best practices,

 Reducing procedural differences, and

 Improving cooperation in cross-border enforcement.110

4.4.5. WTO and Competition Policy

The World Trade Organization (WTO) does not have a formal competition law agreement,
but it does influence related areas like:

 Subsidies,

 Dumping,

 Trade-related investment measures (TRIMs).

The idea of including competition policy in the WTO’s legal framework has been discussed
but remains controversial due to disagreements between developed and developing countries.111

4.4.6. India’s Participation in Global Competition Landscape

India is increasingly active in international discussions on competition. The Competition

Commission of India (CCI):

 Participates in forums like OECD, UNCTAD, and ICN,

 Coordinates with foreign regulators on cross-border mergers,

109
OECD, Global Forum on Competition.
110
International Competition Network, About ICN.
111
WTO, Working Group on the Interaction between Trade and Competition Policy.
63
  Aligns its policies with international standards while keeping in mind local market
conditions.

This helps build credibility and ensures that Indian businesses are not disadvantaged in
global trade.

4.5. Role of Competition Law in Regulating Market Practices

Competition law plays a crucial role in maintaining fair and efficient market practices by
ensuring that businesses operate in a way that benefits consumers, encourages innovation, and
promotes economic growth. It primarily aims to prevent anti-competitive behavior, such as
monopolies, cartels, and abuse of dominant positions, which can harm the overall market and
limit consumer choices.

One of the key objectives of competition law is to promote a competitive market

environment where companies can compete on the basis of quality, price, and innovation, rather
than through unfair practices. By regulating mergers and acquisitions, competition law prevents
the formation of monopolies or oligopolies, which can stifle competition and lead to higher
prices or reduced quality.

Additionally, competition law seeks to prevent price-fixing, market-sharing agreements,

and collusion between businesses that restrict competition. These practices often lead to
artificially high prices and reduced consumer welfare. By prohibiting such conduct, competition
law ensures that businesses compete on merit rather than engaging in practices that harm
consumers.

Moreover, competition law also serves a preventive role, ensuring that firms do not abuse
their market power. For instance, a company with a dominant market position must not exploit
this power to harm smaller competitors or prevent new entrants into the market.

Internationally, competition law is vital in regulating cross-border trade and ensuring that
global markets remain competitive. Countries often cooperate through international agreements
to enforce competition rules, making it difficult for companies to engage in anti-competitive
practices that affect global markets.

CHAPTER V
64
 INTERSECTION OF ANTI-DUMPING LAWS AND COMPETITION LAW

5.1. Theoretical and Legal Analysis of Anti-Dumping Laws and Competition Law

Anti-dumping laws and competition laws are both tools used by governments to make
sure that markets work fairly. However, even though they seem to aim for fairness, they are very
different in what they protect, how they work, and what outcomes they produce. In fact,
sometimes they even work against each other.

A. Purpose and Philosophy of the Two Laws

 Anti-Dumping Law

Anti-dumping law is meant to protect domestic industries from unfair trade practices by
foreign companies. When a foreign company exports goods to India at a price lower than what it
charges in its own country or lower than the cost of production, it is called dumping. Dumping
harms Indian manufacturers because they can’t sell their products at such low prices. If Indian
firms can’t compete, they may shut down, which affects jobs and the economy.

To prevent this, the Indian government can impose anti-dumping duties (extra import
taxes) to raise the price of the imported goods. This makes it easier for Indian companies to
compete.

The goal of anti-dumping law is to protect domestic industries from injury, not
necessarily to help consumers or improve competition.112

 Competition Law

Competition law, on the other hand, tries to protect the competitive process. It makes sure
no company becomes so powerful that it can force others out of the market. It stops monopolies,
price-fixing, abuse of dominance, and unfair agreements. The focus here is on keeping the
market open and fair for all players.

The goal is to increase consumer welfare—lower prices, better quality, and more innovation. 113

112
Section 9A of the Customs Tariff Act, 1975 and WTO Anti-Dumping Agreement, Article VI of GATT.

113
See Sections 3, 4, and 6 of the Competition Act, 2002.
65
B. Difference in Focus: Producers vs. Consumers

This is where a major difference comes in:

 Anti-dumping law is producer-focused. It asks: Is the domestic company being harmed

by cheap imports?

 Competition law is consumer-focused. It asks: Are consumers getting better prices and
choices? Is any company misusing its power?

This difference can lead to conflict. For example, if a foreign company sells high-quality
shoes in India at half the local price, anti-dumping law might say, “This is hurting Indian shoe-
makers—let’s impose duties.” But competition law might say, “This benefits consumers—let it
be!”114

C. Legal Framework: Two Different Systems

In India, these two laws are completely separate:

 Anti-dumping law is part of trade law. It is based on international agreements, especially

under the World Trade Organization (WTO). In India, it is found in Section 9A of the
Customs Tariff Act, 1975 and the Anti-Dumping Rules, 1995. The Directorate General of
Trade Remedies (DGTR) investigates dumping cases and recommends duties. The final
decision is taken by the Ministry of Finance.

 Competition law is part of domestic law. It is found in the Competition Act, 2002, and it
is enforced by the Competition Commission of India (CCI). CCI can punish companies
for anti-competitive agreements, abuse of dominant position, or harmful mergers.115

These two systems do not coordinate with each other. So, the DGTR may impose anti-
dumping duties without checking whether those duties will reduce market competition or raise
prices for consumers.

D. Same Practices, Different Treatment

Some market practices are treated differently under each law:

114
Bhattacharjea, A. (2008). Anti-Dumping, Competition, and WTO Law, Oxford University Press.
115
Customs Tariff Act, 1975; Competition Act, 2002; DGTR and CCI official websites.
66
Practice Anti-Dumping Law Competition Law

Low pricing by foreign Can be penalized (if injury is

Allowed (if it's due to efficiency)
firm proven)

Price undertakings Accepted as a solution May be seen as cartel or collusion

Duties imposed without Requires proof of intent to eliminate

Predatory pricing
proving intent rivals

Not always illegal if it improves

Price discrimination Can be punished
consumer value

This shows how the same behavior can be praised by one law and punished by the other

E. Economic Philosophy: Short-Term Protection vs. Long-Term Efficiency

Anti-dumping laws often provide short-term relief by protecting domestic producers. But this
can lead to long-term problems:

 Domestic firms may become lazy and stop improving.

 Consumers pay higher prices.

 Innovation slows down.

Competition law looks at the long-term efficiency of the economy. It encourages businesses
to reduce costs, improve products, and stay innovative.

So while anti-dumping law fixes immediate problems for producers, competition law builds a
stronger market for the future.116

5.2. Over Lapping between Anti-Dumping and Competition Policies

Even though anti-dumping and competition laws are separate, in reality, their impact on
the market often overlaps. This means they may deal with the same economic situations—like
low prices, dominant firms, or reduced competition—but from very different points of view.

116
Hoekman & Mavroidis (2011). Incorporating Competition Principles into Anti-Dumping Law.
67
When both laws apply to the same market situation, it can cause confusion and even
contradictory results.

A. Overlapping in Price Regulation

One of the most important overlaps between the two laws is their treatment of pricing strategies.

Under competition law, low prices are usually considered a good thing. If a company
reduces prices because it is efficient, innovative, or wants to offer consumers a better deal, the
Competition Commission of India (CCI) will often welcome it. The law believes that this kind of
price reduction improves consumer welfare and encourages healthy market behavior.

However, under anti-dumping law, the same low prices can be seen as a bad thing if they
hurt local producers. If an imported product is priced lower than its cost of production or lower
than the domestic price in the exporter's country, it may be considered "dumping," and the
government can impose anti-dumping duties to protect Indian industries117.

This creates a major policy contradiction. For example, if a Chinese solar panel
manufacturer exports high-quality panels at very low prices, the CCI might say, “Great for Indian
consumers!” But the Directorate General of Trade Remedies (DGTR), which investigates
dumping, may say, “This is harming Indian manufacturers—impose duties.”

B. Impact on Market Entry

Another area of overlap is in the entry of new players, especially foreign companies.

Competition law encourages new companies to enter the market, which increases
competition and benefits consumers. It sees new entrants as a positive sign of a healthy economy.
The Competition Act, 2002 even focuses on maintaining freedom of trade in markets118.

However, when anti-dumping duties are imposed, they can act as price barriers that make
it difficult for foreign companies to enter or survive in the Indian market. These duties raise the
cost of imports and can keep efficient, low-cost international firms out of the market. This means
Indian consumers may have fewer choices, and prices might remain higher.

117
Customs Tariff Act, 1975,Sec9A; Customs Tariff (Identification, Assessment and Collection of Anti-Dumping
Duty on Dumped Articles and for Determination of Injury) Rules, 1995.
118
Competition Act, 2002, Preamble; see alsoSec3 (anti-competitive agreements),Sec4 (abuse of dominance),Sec6
(regulation of combinations).
68
 This overlap can cause serious tension. One law (competition) says “let more competitors
in,” while the other (anti-dumping) says “keep them out if they’re too cheap.”

C. Potential to Create Domestic Monopolies

Another problem arises when anti-dumping measures unintentionally help dominant

domestic firms.

For example, if foreign companies are pushed out of the Indian market because of anti-
dumping duties, the local firms who remain may raise prices or stop innovating. In some cases,
this can lead to monopoly-like conditions, where one or two domestic companies control the
entire market. This is exactly what competition law is designed to prevent 119.

So ironically, anti-dumping laws meant to protect competition from foreign "unfair trade"
can end up hurting competition at home by creating market dominance.

D. No Institutional Coordination

One major issue in India is that the DGTR and CCI work in silos. They do not consult or
coordinate with each other, even when their decisions affect the same industries.

For instance, DGTR might impose duties on imported chemicals to protect Indian
chemical firms, while CCI might be reviewing a merger between those same firms to check for
anti-competitive effects. Yet, there is no legal requirement for them to share information or
conduct joint analysis120.

This separation means that two government bodies could end up making opposite
decisions that confuse businesses and weaken market outcomes.

E. Real-World Effects of the Overlap

This overlap of anti-dumping and competition policies has practical consequences:

1. Higher Prices for Consumers

119
Eleanor M. Fox, “Competition Law and the WTO: The Unfinished Agenda,” 4 J. Int’l Econ. L. 231 (2003).
120
Pradeep S. Mehta & Ujjwal Kumar, “Interface Between Anti-Dumping Policy and Competition Policy,” CUTS
International Discussion Paper (2011).
69
 Anti-dumping duties often raise prices of imported goods. While this helps domestic
manufacturers, it hurts consumers, especially if domestic alternatives are more expensive or
lower in quality. This is a clear violation of the consumer welfare principle in competition law 121.

2. Reduced Innovation

If local firms know they are protected by anti-dumping laws, they may not feel the need to
innovate or improve efficiency. This hurts the long-term competitiveness of the Indian economy.

3. Disruption in Supply Chains

Many industries depend on imported raw materials or components. For example, Indian auto
manufacturers need imported steel. If anti-dumping duties are imposed on steel, entire supply
chains suffer, and this slows down the production process.

4. International Trade Conflicts

Overuse of anti-dumping measures can trigger retaliatory actions by other countries. This
hurts India’s global trade reputation and its relationships at the World Trade Organization
(WTO)122.

F. A Need for Balance

The overlapping effects of anti-dumping and competition law show the need for better
coordination. A decision that protects producers shouldn’t ignore its effect on consumers and
long-term market competition. If India wants to become a globally competitive economy, it must
create a system where both laws support each other, not work at cross-purposes.

Legal scholars suggest the following reforms:

 Conduct a competition impact assessment before imposing any anti-dumping duty.

 Encourage dialogue between DGTR and CCI when reviewing trade-sensitive sectors.

 Train officials in both institutions on the economic impacts of each other’s decisions.

121
Richard Dale, Anti-Dumping Law in a Liberal Trade Order (2000).
122
Hoekman & Mavroidis, “WTO Disciplines on Anti-Dumping and Competition Policy: What’s Left of the
Agenda?” 11 J. World Trade 81 (2011).
70
Only by bridging this gap can India create a trade and competition policy that works for
everyone producers, consumers, and the economy as a whole.

5.3. Examples of Overlapping

While theories and laws tell us that anti-dumping and competition laws may clash, real-
world examples prove just how serious and complex these overlaps can be. These cases from
India and abroad show that the application of anti-dumping duties can sometimes unintentionally
harm competition, raise prices, and hurt consumers, even if the original goal was to protect
domestic industries.

A. Cold-Rolled Steel Case – India

In the early 2000s, India imposed anti-dumping duties on cold-rolled steel imports from
countries like China, South Korea, Japan, and Ukraine. This was done after local steel producers
such as SAIL and Tata Steel complained that cheap imports were harming their business.

The Directorate General of Trade Remedies (DGTR) conducted an investigation and

found evidence of dumping. As a result, it recommended anti-dumping duties, which were
accepted by the Ministry of Finance123.

Impact:

 Indian steel producers benefitted. They could increase their prices and regain some
market share.

 But downstream industries like car manufacturers, construction firms, and appliance
makers suffered. The cost of steel rose sharply, affecting production costs and end
consumer prices.

This case shows that while anti-dumping laws helped producers, they hurt competition and
reduced consumer welfare, which goes against the very spirit of competition law124.

B. Solar Panel Case – India (2014 & 2018)

123
Directorate General of Anti-Dumping & Allied Duties, Final Findings in Cold-Rolled Flat Products Case (2002);
Ministry of Finance Notification No. 134/2002-Customs (ADD), G.S.R. 884(E), dated 30 December 2002.
124
Arpita Mukherjee & Tanu M. Goyal, “Policy Issues in Steel Industry and the Role of Competition Law,” Indian
Council for Research on International Economic Relations (2012).
71
 India also used anti-dumping laws to protect its solar panel industry. In 2014 and again in
2018, DGTR launched investigations against imports of solar photovoltaic (PV) modules and
cells from China, Malaysia, and Taiwan.

The investigations found that foreign companies were selling below cost, and Indian
firms like Indosolar and Vikram Solar were struggling to compete. As a result, India imposed
provisional and definitive anti-dumping duties125.

Problem:

While this move protected domestic manufacturers, it raised the cost of solar power projects.
Developers like Tata Power Solar and other private players argued that these duties:

 Slowed down solar energy adoption.

 Made electricity costlier for consumers.

 Hurt India’s National Solar Mission, which aimed to promote clean energy.

So, while the anti-dumping law helped local firms in the short term, it worked against
environmental policy goals, consumer affordability, and competitive growth in the renewable
energy sector126.

C. Grasim Industries Ltd. v. CCI (2018)

This was not an anti-dumping case, but it still helps us understand how price
manipulation is viewed under competition law.

Grasim Industries, a leading cement company, was accused of using its dominant position
to limit production and raise cement prices, which was considered abusive under Section 4 of the
Competition Act, 2002127.

Why it matters:

125
Directorate General of Trade Remedies, Final Findings on Imports of Solar Cells, Notification No. 14/25/2017-
DGAD; Ministry of Finance, Notification No. 1/2018-Customs (SG), dated 30 July 2018.
126
Mehta, Pradeep S., and Kumar, Ujjwal, “Interface Between Anti-Dumping and Competition Policy,” CUTS
International (2011).
127
Grasim Industries Ltd. v. Competition Commission of India, 2018 SCC Online Competition ACT 4.
72
 In anti-dumping cases, domestic companies sometimes raise prices after foreign
competition is blocked by duties. If a domestic firm becomes dominant and uses that position to
control supply and pricing, it may violate competition law, even if it was previously protected
under anti-dumping provisions.

This shows how pricing behavior can be punishable under competition law and protected
under anti-dumping law, depending on which law is applied.

D. EU – Steel Imports from China

In the European Union (EU), anti-dumping duties were imposed on steel products
imported from China. The European Commission justified this by arguing that Chinese
companies were selling below cost, which was harming local European steel firms128.

However:

 Industries that relied on steel, such as automobile manufacturers and construction

companies, faced higher input costs.

 Prices of consumer goods, vehicles, and real estate increased.

 Critics said the EU was using anti-dumping duties to protect old industries instead of
supporting market efficiency and innovation.

Thus, the EU’s attempt to help one part of the economy ended up hurting multiple
downstream sectors and consumers, contradicting competition principles129.

E. U.S.–Canada Softwood Lumber Dispute

This is one of the longest-running trade disputes in North America. The U.S. accused
Canadian lumber companies of receiving unfair subsidies and dumping softwood lumber in the
U.S. at low prices.

128
European Commission, Regulation (EU) 2016/1036 on protection against dumped imports from countries not
members of the EU; Case concerning Hot-Rolled Flat Steel Products from the People’s Republic of China.
129
Simon J. Evenett & Edwin Vermulst, “The Politicisation of EU Anti-Dumping Policy: Member States, Their
Votes and the European Commission,” 28 Eur. J. Pol. Econ. 546 (2005).
73
 The U.S. imposed anti-dumping and countervailing duties multiple times, most recently
in 2017130.

Effects:

 Duties increased the cost of housing in the U.S., as softwood lumber is a key building
material.

 Canadian lumber companies lost market access.

 Consumers and homebuilders in the U.S. suffered.

 The case led to legal battles at the WTO and under NAFTA.

Although the U.S. claimed it was protecting its domestic lumber industry, the actual result
was reduced competition, higher consumer prices, and trade tensions.

F. Lessons from the Case Studies

These examples reveal a clear pattern:

 Anti-dumping measures, though legal and WTO-compliant, can disrupt healthy

competition.

 They may protect one industry but damage others.

 They can help producers while hurting consumers.

 Sometimes, they delay reforms and support inefficiency.

Legal scholars argue that there must be a better balance between anti-dumping actions and
competition goals. Some even suggest that competition impact assessments should become
mandatory before imposing anti-dumping duties131.

130
WTO, United States – Anti-Dumping Measures Applying Differential Pricing Methodology to Softwood Lumber
from Canada, DS534; also see U.S. Department of Commerce, Investigation Nos. A-122-857, C-122-858 (2017).
131
Bernard Hoekman & Petros C. Mavroidis, “WTO Disciplines on Subsidies and Countervailing Measures: What’s
Left of the Agenda?” 11 J. World Trade 81 (2011).
74
 CHAPTER VI

IMPACT OF ANTI-DUMPING MEASURES ON MARKET DYNAMICS

6.1. Effect of Anti Dumping Duties on Domestic and Foreign Markets

Anti-dumping duties (ADDs) are additional import taxes imposed when a foreign
company sells goods in another country at a price lower than their cost or their home market
price. These duties aim to correct the unfair pricing and protect local producers from being wiped
out by underpriced imports. While they are designed to safeguard domestic industries, anti-

75
dumping duties also affect market behavior, trade flows, production, and pricing in both
domestic and foreign economies.

A. Impact on Domestic Markets

1. Shielding Domestic Producers

The most direct impact of anti-dumping duties is on domestic industries. When ADDs are
imposed, they increase the price of dumped imports, making them less attractive to consumers.
This gives domestic producers the chance to compete fairly.

For example, when Indian steelmakers were unable to match low-priced Chinese imports
of cold-rolled steel, the DGTR imposed anti-dumping duties. These duties helped domestic firms
recover, retain market share, and stabilize operations.132

Without this support, Indian steel plants might have shut down, leading to job losses and
industrial slowdown.

2. Employment and Investment Protection

Anti-dumping duties help protect employment by allowing struggling domestic industries

to remain in operation. In sectors like chemicals and textiles, domestic companies often operate
with thin margins. Dumped imports can force them to shut down. By raising the price of imports,
ADDs give domestic firms breathing space to retain employees and plan investments.

This temporary shield also encourages firms to invest in productivity improvements,

provided the ADDs are not prolonged indefinitely.

3. Risk of Complacency and Inefficiency

While ADDs protect industries, long-term use can lead to complacency. Domestic firms
might rely on protection rather than innovation. When firms don’t have to compete with
international players, they may stop improving quality, delay technological upgrades, and ignore
efficiency.

132
Arpita Mukherjee and Tanu M Goyal, ‘Policy Issues in Steel Industry and the Role of Competition Law’ (ICRIER
2012).

76
 This was observed in the Indian solar panel manufacturing sector. Despite being
protected by ADDs against Chinese imports, domestic firms failed to develop sufficient scale and
competitiveness in global markets.133

4. Negative Impact on Downstream Industries

Often, the sectors that use imported goods as raw materials are harmed by anti-dumping
duties. For example, if a domestic car manufacturer relies on imported steel or chemicals, duties
on these imports raise production costs. This makes the final product costlier for consumers and
reduces the competitiveness of the entire downstream supply chain.

The cold-rolled steel case in India is a prime example. While steelmakers benefited from
ADDs, car manufacturers, appliance makers, and construction firms suffered from increased
input costs.134

B. Impact on Foreign Exporting Markets

1. Barriers to Market Access

Anti-dumping duties make foreign goods more expensive in the importing country. As a
result, foreign exporters lose access to that market. If the exporting country depends on that
market for a large share of its revenue, this loss can have serious consequences, including
business closures and job losses.

For example, when India imposed duties on solar cells from China, Malaysia, and
Taiwan, exporters from these countries saw a sharp drop in orders and revenue from India.135

2. Trade Diversion and Overcapacity

133
Pradeep S Mehta and Ujjwal Kumar, ‘Interface Between Anti-Dumping Policy and Competition Policy’ (CUTS
International 2011).
134
Ministry of Finance, Notification No 134/2002-Customs (ADD), Cold-Rolled Flat Steel Products, GSR 884(E),
30 December 2002.

135
Directorate General of Trade Remedies, ‘Final Findings on Imports of Solar Cells from China, Malaysia and
Taiwan’ Case No 14/25/2017-DGAD (2018).
77
 Once barred from one market, exporters look for alternative destinations. This leads to a
phenomenon called trade diversion. Exporters dump their goods in other countries, often leading
to oversupply, falling prices, and destabilization in those new markets.

This domino effect disrupts regional and global pricing, harming producers in third
countries who now face a flood of underpriced imports.

3. Trade Tensions and WTO Disputes

Countries hit by anti-dumping duties often challenge them at the World Trade
Organization (WTO). These disputes can strain trade relationships and create legal uncertainty.

India has been taken to the WTO by countries like the European Union, the USA, and
Japan. These cases generally involve allegations of improper injury calculations, lack of
transparency, or use of outdated price comparisons.136

C. Broader Economic Effects

1. Short-Term Relief, Long-Term Challenges

Anti-dumping duties can offer short-term protection, but if used repeatedly or

indefinitely, they hurt market efficiency. Firms focus on surviving rather than improving.
Consumers pay higher prices, and downstream firms suffer from supply disruptions and cost
escalation.

According to economist J Michael Finger, anti-dumping is often used as a “legally

sanctioned form of protectionism”, and overuse can do more harm than good.137

6.2. Impact on Consumer welfare, Pricing and Market Efficiency

Anti-dumping duties are imposed to protect domestic producers from unfair competition.
However, they also have side effects that directly impact consumers, pricing structures, and the
overall efficiency of the market. While the protection of producers is often the focus of anti-

136
WTO Dispute Settlement Body, ‘India—Anti-Dumping Measures on Certain Products from the European Union’
WT/DS493; ‘India—Certain Iron and Steel Products’ WT/DS518.

137
J Michael Finger, Antidumping: How It Works and Who Gets Hurt (University of Michigan Press 1993)
78
dumping measures, the consequences for consumer welfare and market health are equally
important to understand.

A. Impact on Consumer Welfare

1. Higher Prices for Consumers

When anti-dumping duties are imposed, the price of imported goods increases. This
results in higher retail prices, especially for goods that are either not produced domestically or
for which domestic production is inadequate or costly.

For example, when India imposed anti-dumping duties on imported solar panels, the cost
of solar energy projects went up. These higher project costs eventually trickled down to
consumers, who had to pay higher electricity rates.138

In such cases, the burden of protection granted to producers is effectively shifted to

consumers.

2. Limited Product Variety and Choice

When foreign goods are made more expensive or restricted, consumers may have fewer
choices in the market. In many cases, domestic manufacturers may not provide the same range,
quality, or innovation as their international counterparts.

For instance, in consumer electronics and textile industries, foreign imports often bring in
diverse styles and technologies. If anti-dumping duties are imposed on such products, consumers
may be forced to settle for fewer options or inferior alternatives.

3. Long-Term Consumer Disadvantage

While the impact may appear limited at first, long-term use of anti-dumping duties often
leads to market stagnation. Domestic producers may face little competition and therefore lack the
incentive to improve quality or lower prices. This has a lasting negative impact on consumer
satisfaction and welfare.

138
CUTS International, ‘Revisiting India’s Solar Anti-Dumping Policy: Aligning with Competition and Consumer
Welfare’ (CUTS Briefing Paper, 2019).
79
 According to economic researchers, when protection is used excessively, it is the
consumers who pay the real price in the form of higher costs and fewer benefits.139

B. Impact on Pricing Mechanisms

1. Distortion of Natural Price Competition

One of the main problems with anti-dumping duties is that they interfere with natural
price competition. Normally, when firms compete freely, prices go down and consumers benefit.
However, ADDs prevent this by artificially raising the prices of imports.

Let’s say a foreign company can sell high-quality fabric at ₹50, while the Indian
alternative is ₹70. If an ADD of ₹30 is imposed, the foreign good now costs ₹80 removing the
incentive for Indian producers to lower their prices or improve their quality.

This leads to a market where price signals no longer reflect efficiency or innovation, but
legal barriers.

2. Rise in Input Prices for Other Industries

Many industries rely on imported goods as raw materials or inputs. If anti-dumping duties
raise the prices of these inputs, the entire supply chain suffers. Manufacturers pass the added
costs to retailers, and eventually to consumers.

For example, ADDs on imported steel increased the cost of production in India’s
automobile and construction industries, resulting in more expensive cars and homes for
consumers.140

3. Encouragement of Inefficiency in Domestic Firms

Another pricing issue is that anti-dumping duties can protect inefficient domestic firms.
These firms survive not because they offer better prices or products, but because their
competitors are legally disadvantaged. Over time, this reduces the pressure on domestic firms to
lower prices or increase quality, damaging the price-quality ratio in the market.

139
J Michael Finger, Antidumping: How It Works and Who Gets Hurt (University of Michigan Press 1993).
140
Ministry of Finance, Notification No 134/2002-Customs (ADD), Cold-Rolled Flat Steel Products, GSR 884(E),
30 December 2002.
80
 This creates a false sense of competitiveness where domestic firms are not responding to
market realities, but relying on legal protections instead.141

C. Impact on Market Efficiency

1. Misallocation of Resources

Market efficiency depends on the idea that resources (like capital and labour) flow to the
most productive firms. When ADDs are applied, these resources may remain stuck in less
productive sectors simply because they are being protected from global competition.

This leads to what economists call misallocation of resources—an inefficient distribution

that hampers overall economic growth.

2. Slower Innovation and Productivity Growth

Domestic companies that face strong international competition often work harder to
improve products, reduce costs, and innovate. But when anti-dumping duties eliminate that
competition, the incentive to innovate disappears.

In India, protected firms in the solar and chemical sectors failed to match global
standards even after several years of ADD protection. Instead of investing in R&D, many firms
relied on legal measures to keep their rivals out.142

3. Long-Term Decline in International Competitiveness

If domestic industries do not improve their efficiency or pricing, they fail to compete
internationally. While ADDs may help in the short run, they create an environment where firms
grow dependent on protection and lose their global edge.

This has been a repeated problem in India's steel, solar, and electronics sectors, where the
industry’s global competitiveness remains low despite years of protective duties.
141
Richard Dale, Anti-Dumping Law in a Liberal Trade Order (Macmillan 2000).
142
Aditya Bhattacharjea, ‘India’s Anti-Dumping Policy and Practices: A Critical Review’ (2008) 43(6) Economic
and Political Weekly 67.
81
 Thus, Anti-dumping duties are intended to restore fairness in international trade, but they
often have hidden costs. These include:

 Higher prices for consumers

 Reduced choices and quality

 Distorted pricing signals

 Market inefficiencies and protection of weak firms

While protecting producers is important, it should not come at the cost of consumer welfare
and market health. The real challenge lies in balancing trade protection with economic efficiency.
Policymakers should ensure that anti-dumping measures are temporary, targeted, and regularly
reviewed, and that consumer interests are formally included in the decision-making process.

6.3. India’s Experience with Anti-Dumping Laws and Impact

6.3.1 Overview of India's Anti-Dumping Regime

India has been utilizing anti-dumping measures to protect its domestic industries from
unfair trade practices, particularly since the early 1990s. As a member of the World Trade
Organization (WTO), India is required to conform to the international standards laid out in the
Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade
(GATT) 1994, which governs anti-dumping measures. The country’s anti-dumping regime is
primarily regulated by the Customs Tariff Act, 1975, with the Directorate General of Trade
Remedies (DGTR), formerly known as the Directorate General of Anti-Dumping and Allied
Duties (DGAD), responsible for conducting investigations into anti-dumping complaints.

The investigation process is initiated either by a complaint from a domestic industry or by

a government-led inquiry. The DGTR examines whether dumping, i.e., selling goods at unfairly
low prices, is taking place, and if it is determined that dumping has caused injury to domestic
producers, anti-dumping duties are imposed to remedy the situation. These duties are intended to
align the price of imported goods with the fair market value143.

6.3.2 Increase in Anti-Dumping Measures

143
Customs Tariff Act, 1975 (India), s 9A.
82
 India has become one of the leading users of anti-dumping measures globally, with over
400 anti-dumping investigations initiated between 1995 and 2020. The country’s most common
anti-dumping investigations have focused on industries such as chemicals, steel, and textiles.
This surge in the use of anti-dumping duties, particularly since India’s economic liberalization in
the early 1990s, underscores the nation’s growing reliance on trade remedies to shield its
domestic market from potentially harmful foreign pricing practices.

In this context, India’s experience aligns with the broader trend of developing economies
increasingly resorting to anti-dumping actions as a means of protecting nascent industries from
competition, especially in sectors facing heavy imports from countries like China. This trend has
been particularly prominent in the steel and chemical industries, where Chinese dumping has
been a recurring concern144.

6.3.3 Impact on Domestic Industries

The imposition of anti-dumping duties in India has provided significant relief to several
domestic industries by safeguarding them from the predatory pricing tactics of foreign producers.
For example, the imposition of anti-dumping duties on Chinese steel imports has been pivotal in
protecting the Indian steel industry from excessively low-priced imports. These measures have
enabled domestic producers to compete more effectively, particularly in high-cost manufacturing
environments.

However, these measures have not been without their drawbacks. The protection offered
to domestic industries has, in some cases, led to inefficiencies in production. Domestic industries
shielded from international competition may become complacent and less innovative, which can
stifle growth and reduce overall market competitiveness. Furthermore, the higher prices resulting
from the imposition of anti-dumping duties can harm consumers, particularly in industries reliant
on imports for raw materials or finished products, such as the automobile and construction
sectors, which face higher steel costs145.

6.3.4 Challenges in International Trade Relations

144
Directorate General of Trade Remedies, Ministry of Commerce & Industry, Government of India, ‘Annual
Report’ (2020-21).
145
Jagdish N. Bhagwati, Protectionism (MIT Press 1988) 72.
83
 India’s use of anti-dumping measures has often been contentious in its international trade
relations. Countries like the European Union and the United States have criticized India for
resorting too frequently to anti-dumping duties, arguing that they often constitute protectionist
measures that violate fair trade principles. For instance, the European Commission has raised
concerns about India’s anti-dumping practices, especially in cases involving products like steel,
alleging that India’s approach frequently results in trade distortions that negatively impact
exporters from other countries146.

Moreover, the imposition of anti-dumping duties has, at times, led to retaliatory measures
from trading partners, complicating India’s participation in global trade agreements. These
retaliatory actions can escalate into trade disputes, further affecting India’s position in the global
market147.

6.3.5 Balancing Protection and Consumer Welfare

While India’s anti-dumping measures have succeeded in protecting certain domestic

industries, their overall impact has been mixed. While these laws shield domestic producers from
unfair foreign competition, they also raise prices for consumers, particularly in industries reliant
on imported goods. The long-term effectiveness of anti-dumping laws in fostering a competitive
market remains questionable, and India may need to reconsider its approach, balancing the
protection of domestic industries with the need to ensure that consumers are not unduly burdened
by higher costs148.

146
European Commission, ‘Trade Policy Review of India’ (2019) European Commission Doc 1026/2019.
147
World Trade Organization, ‘India – Anti-Dumping Measures on Imports of Certain Hot-Rolled and Cold-Rolled
Stainless Steel Products from Japan, China, and the European Union’ (2019) WTO Doc WT/DS540/AB/R.
148
WTO, ‘Anti-Dumping: India’s Use of Anti-Dumping Measures’ (2016).
84
 CHAPTER VII

INTERNATIONAL PERSPECTIVE ON ANTI-DUMPING LAWS AND

PRACTICES

7.1. United States Model

The United States has one of the oldest, most active, and most influential anti-dumping
systems in the world. It was one of the first countries to formally legislate against the practice of
dumping. The journey began with the Revenue Act of 1916, which criminalized unfair foreign
pricing, and later progressed with the Anti-Dumping Act of 1921, which laid the groundwork for
modern trade remedy measures. Today, U.S. anti-dumping law is primarily governed by the
Tariff Act of 1930, specifically under Title VII of the Act, as amended over time. This law
provides the main legal framework for determining, investigating, and penalizing dumping
practices in the United States.149

The U.S. system involves two key government bodies working together:

1. The Department of Commerce (DoC): This agency is responsible for investigating

whether dumping has occurred. It determines the normal value (price in the exporter’s

149
Tariff Act of 1930, 19 U.S.C.Sec1671
85
 domestic market) and the export price (price in the U.S. market). The difference between
these prices is called the dumping margin.150

2. The U.S. International Trade Commission (USITC): After the doc confirms that
dumping has occurred, the USITC assesses whether this dumping is causing “material
injury” to the domestic industry. Only when both dumping and injury are established can
duties be imposed.151

One major feature of the U.S. anti-dumping system is its use of a calculation technique called
"zeroing." In this method, if some transactions are sold at prices above the normal value (i.e., not
dumped), those positive differences are set to zero when calculating the overall dumping margin.
This inflates the final margin and often results in higher duties. While this approach has been
repeatedly challenged at the World Trade Organization (WTO), the U.S. has defended its use in
various forms.152

Another distinctive aspect of the U.S. model is its strict legal process. Investigations are often
initiated after a petition is filed by domestic industries or labor unions. The U.S. laws are known
to favor domestic industries and are used aggressively even when there is minimal impact on
consumer welfare.153

The U.S.–Canada Softwood Lumber dispute is one of the most well-known examples of anti-
dumping measures applied by the U.S. In this long-running trade battle, the U.S. repeatedly
accused Canada of subsidizing its lumber industry and dumping softwood lumber into the U.S.
market at unfair prices. The U.S. imposed duties several times, which raised housing and
construction costs in the U.S. and led to legal disputes under NAFTA and the WTO.154

Critics argue that the U.S. uses anti-dumping duties more as a protectionist tool rather than a
measure against unfair trade. For example, domestic companies often lobby the government to

150
19 C.F.R.Sec351.401–351.410
151
U.S. Int’l Trade Comm’n, Understanding Investigations.
152
Appellate Body Report, United States – Measures Relating to Zeroing and Sunset Reviews, WTO Doc.
WT/DS322/AB/R (Jan. 9, 2007).
153
Chad P. Bown, The WTO and Anti-Dumping in Developing Countries, 183–85 (2013).
154
U.S. – Softwood Lumber VI, WTO Doc. WT/DS277; also see CRS Report R43085, Softwood Lumber Dispute:
U.S.–Canada Trade.
86
impose duties on foreign competitors, even when no predatory pricing is involved. In such cases,
anti-dumping duties shield inefficient industries from fair market competition 155

Despite the criticisms, the U.S. anti-dumping model remains influential and widely imitated.
It provides a strong legal mechanism for responding to perceived unfair trade, although its
aggressive use has led to frequent international trade disputes and accusations of violating WTO
norms.156

The system prioritizes the interests of domestic producers and takes a narrow view of
economic injury, often overlooking broader effects on downstream industries and consumers.

7.2. European Union Model

The European Union (EU) has a well-structured and legally comprehensive anti-dumping
system. As a single customs union, the EU handles trade remedies—including anti-dumping—
through EU-wide regulations rather than allowing each member state to create its own rules. This
centralization helps maintain consistency in how dumping cases are investigated and resolved
across the Union.157

The main legal basis for anti-dumping measures in the EU is Regulation (EU) 2016/1036,
known as the Basic Anti-Dumping Regulation. 158 This regulation is aligned with the World Trade
Organization (WTO) Anti-Dumping Agreement, ensuring that EU rules comply with
international standards. The regulation allows the European Commission—the executive arm of
the EU—to launch investigations, assess dumping and injury, and impose duties if needed.

 Institutional Framework and Process

The European Commission is responsible for conducting dumping investigations. The

process usually starts when an EU industry files a complaint supported by evidence of dumping
and injury. If the Commission finds sufficient proof, it initiates an investigation. The
investigation must show three things:

155
Michael Finger, Antidumping: Stupid Economics, Unprincipled Law, and Trouble-Making Diplomacy, World
Bank Policy Research Working Paper No. 2730 (2000).
156
Bhattacharjea, Anti-Dumping, Competition, and WTO Law 117–120 (2008).

157
Treaty on the Functioning of the European Union art. 207, Oct. 26, 2012, 2012 O.J. (C 326) 47.
158
Council Regulation 2016/1036, 2016 O.J. (L 176) 21 (EU).
87
 1. Dumping is occurring (products are sold in the EU below their “normal value”).

2. The dumping causes material injury to the EU industry.

3. There is a causal link between the dumped imports and the injury.159

After this, the Commission may impose provisional duties for up to six months and later
propose definitive duties that can last for five years. However, these proposals are subject to
approval by the Anti-Dumping Committee, made up of representatives from all EU Member
States.160

 Community Interest Test

One key feature of the EU model is the “Community interest test.” This means that the
Commission must consider not only the interests of producers but also those of importers, users,
and consumers.161 If imposing duties would harm the broader economy or consumers more than
it would benefit producers, the Commission may decide not to impose duties, even if dumping is
proven. This balanced approach sets the EU apart from more producer-focused systems like that
of the United States.

 Treatment of Non-Market Economies (e.g., China)

For countries that are not considered “market economies,” like China, the EU has
traditionally used a “constructed normal value.” This means the Commission estimates what the
product's price should be in a fair market, based on third-country benchmarks. This practice has
been challenged, especially by China, in WTO disputes.162

 Case Example: Chinese Steel

One well-known case is the EU’s imposition of anti-dumping duties on Chinese steel. EU
steel producers complained that China was exporting steel at extremely low prices, harming
159
Id. arts. 1–3.
160
European Commission, Trade Defence Instruments: Investigation Procedures.
161
Id. art. 21.
162
Appellate Body Report, European Union – Measures Affecting Tariff Concessions on Certain Poultry Meat
Products from Brazil, WTO Doc. WT/DS492/AB/R (Aug. 4, 2017).
88
European firms. While the duties helped protect EU steel manufacturers, they also raised
concerns from industries like automotive and construction, which rely on affordable steel. Critics
argued that the EU was using anti-dumping to practice protectionism, leading to higher costs for
consumers and industrial users.163

 Criticisms and Legal Disputes

Although the EU system is praised for being rules-based and transparent, it has faced
criticism for being slow and overly bureaucratic. Industries needing urgent protection may feel
frustrated with delays. Additionally, its use of “constructed values” and the community interest
test have been challenged at the WTO.164

Nevertheless, the EU’s anti-dumping model is considered more balanced than that of the U.S.
because it tries to weigh the interests of all stakeholders—not just producers. It is one of the few
systems that actively incorporates consumer impact into its decision-making process, making it
more holistic and trade-sensitive.

7.3. China Model

China is one of the most significant players in global trade today, and its approach to anti-
dumping laws reflects both its economic priorities and strategic trade policies. China did not
originally have a strong framework for anti-dumping because for many years, it was primarily a
target of anti-dumping measures, especially from countries like the United States and the
European Union. However, after joining the World Trade Organization (WTO) in 2001, China
was required to align its laws with international trade standards, including the WTO Anti-
Dumping Agreement.165

To fulfill these obligations, China enacted the Foreign Trade Law of the People’s Republic of
China and the Anti-Dumping Regulations in 2004. These regulations outline the conditions under
which China may investigate and impose anti-dumping duties on imported goods.166

 Key Features of China's Anti-Dumping Framework

163
Evenett & Vermulst, The Politicisation of EU Anti-Dumping Policy: The Case of Steel from China, in European
Journal of International Law, Vol. 16 (2005).
164
Chad P. Bown, The WTO and Anti-Dumping in Developing Countries 205–07 (2013).
165
World Trade Organization, Protocol on the Accession of the People's Republic of China, WT/L/432 (Nov. 23,
2001).
166
Anti-Dumping Regulations of the People's Republic of China (2004), Order No. 125 of the State Council.
89
  The Ministry of Commerce (MOFCOM) is the main authority responsible for
investigating dumping allegations, determining injury to domestic industries, and
recommending anti-dumping measures.167

 Like other WTO-compliant systems, China’s laws require proof of:

1. Dumping (selling below “normal value”),

2. Material injury to the domestic industry, and

3. A causal link between the two.168

 Use of Anti-Dumping as a Strategic Tool

In practice, China’s use of anti-dumping laws differs from that of Western countries. China
tends to use anti-dumping duties strategically and selectively, often in response to trade actions
taken against Chinese products. In such cases, anti-dumping becomes a tool of trade retaliation
rather than purely a protective measure.

For example, when the United States imposed anti-dumping duties on Chinese steel and solar
panels, China responded by initiating its own anti-dumping investigations against U.S. products
such as chicken, automotive parts, and chemicals.169

This tit-for-tat pattern has led to criticisms that China's anti-dumping system is politicized
and used more for negotiation and leverage in trade disputes than for correcting unfair pricing
practices.

 Criticism and Transparency Concerns

China’s anti-dumping practices have faced international criticism, especially regarding:

 Lack of transparency in investigations,

 Limited access to case evidence for exporters,

 Allegations of bias in favor of domestic industries, and

167
Id. art. 4.
168
Id. arts. 6–8.
169
Chad P. Bown, China’s Retaliatory Trade Measures: Antidumping and Beyond, World Bank Research Paper
(2011).
90
  Weak judicial review or appeal mechanisms.170

Foreign governments and businesses have often complained that the investigative process in
China is not as open or impartial as required under WTO standards.

 Case Example: U.S. Chicken Imports

In a high-profile case, China imposed anti-dumping duties on U.S. chicken products in 2010
after the U.S. had placed duties on Chinese tires. MOFCOM claimed that U.S. chicken producers
were selling their products at unfairly low prices, harming Chinese poultry farmers. However,
many experts believed the case was retaliatory and aimed at pressuring the U.S. in broader trade
negotiations.171

 Recent Developments

In recent years, China has tried to present itself as a defender of the multilateral trade system.
It has expanded its anti-dumping investigations to cover more sectors such as chemicals, paper,
and metals, and has increasingly targeted countries like the EU and India as well.

Still, China’s dual role as both the world’s largest exporter and a growing user of anti-
dumping laws puts it in a complex position. On one hand, it faces repeated trade remedies
abroad; on the other, it seeks to protect its own industries from foreign competition.

7.4. WTO ADA, Interpretation and Disputes

The World Trade Organization (WTO) plays a central role in regulating how countries
apply anti-dumping measures. Its rules are designed to prevent countries from using anti-
dumping as a disguised form of protectionism while still allowing them to defend their domestic
industries against unfair foreign pricing.

The key legal instrument is the Agreement on Implementation of Article VI of the GATT
1994, commonly known as the WTO Anti-Dumping Agreement (ADA). 172 This agreement
expands on Article VI of the General Agreement on Tariffs and Trade (GATT), which was the
first international rule permitting anti-dumping duties if certain conditions are met.
170
OECD, China’s Anti-Dumping System: Recent Developments and Challenges, Trade Policy Review (2019).
171
MOFCOM Announcement No. 72 (2010), Imposition of Anti-Dumping Duties on U.S. Chicken Products.
172
Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994, Apr. 15, 1994,
Marrakesh Agreement Establishing the WTO, Annex 1A, 1868 U.N.T.S. 201 [hereinafter WTO ADA].
91
 Key Elements of the ADA

The ADA does not prohibit dumping itself; instead, it regulates how countries respond to it.
The agreement allows a country to impose anti-dumping duties only when all of the following
are proven:

1. Dumping has occurred: This happens when a product is exported at a price lower than
its “normal value,” which usually means the price it is sold for in the exporter's home
market.173

2. Material injury: The dumped imports must cause or threaten to cause significant
damage to the domestic industry.174

3. Causal link: There must be a direct connection between the dumped imports and the
injury suffered by the local industry.175

The agreement also outlines strict procedures that countries must follow when conducting
anti-dumping investigations. These include:

 Providing notice and access to evidence to all parties,

 Ensuring the process is transparent and fair,

 Allowing public hearings,

 Imposing duties only for a limited period (usually five years), and

 Reviewing duties periodically (sunset reviews).176

 Interpretation and Implementation Issues

Despite the structured rules, countries often interpret the ADA differently. One major area
of controversy is the use of a practice called “zeroing.” This is when an investigating authority
disregards instances where the export price is higher than the normal value while calculating the
dumping margin artificially inflating the result. The United States has used zeroing in many

173
WTO ADA art. 2.
174
Id. art. 3.1.
175
Id. art. 3.5.
176
Id. arts. 5–11.
92
cases, leading to several WTO disputes. The WTO Appellate Body has ruled against zeroing
multiple times, stating that it violates the ADA.177

Another area of interpretation relates to the “non-market economy” issue. For example,
countries like the U.S. and EU sometimes refuse to use home market prices for countries like
China, arguing that prices in such economies are state-influenced and unreliable. This has led to
disputes over how “normal value” should be constructed.178

 WTO Dispute Settlement Cases

Many trade disputes between countries involve anti-dumping measures. The WTO’s Dispute
Settlement Body (DSB) has handled dozens of cases where one country challenged another’s
anti-dumping duties.

 Important cases include:

 U.S. – Zeroing (Japan): Japan successfully challenged the U.S. practice of zeroing.179

 EU – Fasteners (China): China challenged the EU’s anti-dumping duties on steel

fasteners. The WTO ruled that the EU’s procedures were not fully in line with the
ADA.180

 India – Iron and Steel Products (Japan): Japan brought a case against India over anti-
dumping duties, showing that even developing countries must strictly follow ADA
rules.181

 Global Impact

The ADA is crucial for ensuring that anti-dumping does not become a weapon of
protectionism. It tries to balance two interests:

 Letting countries defend their industries from unfair trade, and

177
Appellate Body Report, United States – Measures Relating to Zeroing and Sunset Reviews, WTO Doc.
WT/DS322/AB/R (Jan. 9, 2007).
178
WTO ADA art. 2.2; see also Chad P. Bown, The WTO and Anti-Dumping in Developing Countries, at 193 (2013).
179
Appellate Body Report, United States – Final Dumping Determination on Softwood Lumber from Canada, WTO
Doc. WT/DS264/AB/R (Aug. 11, 2004).
180
Appellate Body Report, European Communities – Definitive Anti-Dumping Measures on Certain Iron or Steel
Fasteners from China, WTO Doc. WT/DS397/AB/R (Jul. 15, 2011).
181
Panel Report, India – Certain Measures on Iron and Steel Products, WTO Doc. WT/DS518/R (Nov. 6, 2020).
93
  Preventing unjustified trade barriers that hurt consumers and global competition.

However, the ADA’s effectiveness depends heavily on how strictly it is followed and
enforced. Countries sometimes exploit loopholes or interpret rules in self-serving ways, which
leads to legal battles and damages the spirit of fair trade.

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 CHAPTER VIII

HARMONIZING ANTI-DUMPING LAWS AND COMPETITION LAWS IN

INDIA

8.1. Need for Integrated Impact Assessment

In simple words, “integrated impact assessment” means carefully examining how anti-
dumping laws and competition laws affect the market together, before making any final
decisions. In India, these two laws are often treated separately by different government bodies.
But in reality, they influence the same markets, same products, and same consumers so we need
to look at the combined effect of both laws on the economy.

[Link] is this assessment important?

Anti-dumping laws are meant to protect Indian industries from cheap foreign imports. If a
foreign company sells products in India at extremely low prices below their cost of production or
cheaper than in their own country India can impose anti-dumping duties (extra taxes) to stop this
and protect local producers. This helps prevent job losses and closures of Indian factories.

But here's the problem: These anti-dumping duties often make products more expensive
for Indian consumers. They can also reduce consumer choices, limit competition, and make
domestic producers complacent (less motivated to innovate or lower prices). 182 This results in
market distortion, which goes against the objectives of competition law, which aims to keep
markets open, fair, and efficient.

On the other side, competition law under the Competition Act, 2002, is designed to
protect consumers by encouraging low prices, preventing monopolies, and promoting innovation.
It ensures that no company becomes too powerful or abuses its position in the market. But
competition law does not interfere with anti-dumping investigations directly.

182
Mehta & Agarwal, India’s Competition Act and Anti-Dumping Measures (2011) – highlighted the lack of
competition review in dumping cases
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 So, when we apply anti-dumping duties without checking how they affect market
competition or consumer welfare, we may end up protecting industries at the cost of consumers.
This is where integrated impact assessment becomes essential.

Example:

India imposed anti-dumping duties on cheap imported solar panels in 2014 and 2018.
This helped local manufacturers like Vikram Solar and Waaree, but also made solar projects
more expensive. Developers argued that this would increase electricity prices and slow down
India’s clean energy plans. This shows the conflict duties helped one industry but harmed
consumer interest and national environmental goals.183

8.1.2. What should an integrated assessment include?

1. Consumer Impact: Will prices go up? Will choices go down?

2. Market Impact: Will local producers become monopolies?

3. Downstream Effects: Will other industries suffer due to higher input costs?

4. Alternatives: Can price undertakings or short-term support help instead of full duties?

8.1.3. Scholars and experts agree

Legal experts like Mehta & Agarwal (2011) argue that India should make competition
impact assessment mandatory before finalizing anti-dumping duties. They highlighted cases in
solar energy and pharmaceuticals where anti-dumping measures contradicted the objectives of
the Competition Act, 2002.184

Similarly, Hoekman & Mavroidis (2011) support adding competition checks during
dumping investigations, especially under WTO procedures, to avoid abuse of anti-dumping laws
for protectionism.185

8.2. Role of CCI in Trade Remedy cases

183
Indian solar panel dumping cases (2014, 2018) – led to higher energy costs and delays in clean energy goals
despite helping local manufacturers.
184
Mehta & Agarwal, India’s Competition Act and Anti-Dumping Measures (2011) – highlighted the lack of
competition review in dumping cases.
185
Hoekman & Mavroidis, Incorporating Competition Principles into Anti-Dumping Law (2011) – suggested
integrating competition law with WTO anti-dumping rules.
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 In India, trade remedy cases—such as anti-dumping measures—are handled mainly by
the Directorate General of Trade Remedies (DGTR) and the Ministry of Finance. These
authorities look at whether foreign goods are being dumped at unfairly low prices and whether
this is hurting Indian industries. However, they do not usually consider how these duties might
affect market competition, consumer prices, or innovation.

This is where the Competition Commission of India (CCI) can and should play an
important role. The CCI is India’s main regulator for ensuring that markets remain fair,
competitive, and consumer-friendly, as per the Competition Act, 2002.

8.2.1. CCI’s Role and Authority

The CCI's main responsibilities include:

 Preventing cartels and price-fixing.

 Stopping abuse of dominant market position.

 Ensuring that mergers and acquisitions don’t harm competition.

 Protecting consumer interest by ensuring lower prices, more choices, and better quality.

However, currently, the CCI does not have a formal role in anti-dumping investigations, even
though these cases often affect the same markets and players.

8.2.2. Missed Opportunities for Market Oversight

In many situations, anti-dumping duties lead to higher product prices, reduced imports,
and less competition in the domestic market. Local producers, once shielded from foreign
competition, might raise their prices or slow down innovation, knowing they are protected.

For example, in the Grasim Industries Ltd. v. CCI (2018) case, the CCI fined Grasim for
abusing its dominant position in the cement market by raising prices and limiting supply. This
kind of behavior would be penalized under competition law.

However, under anti-dumping law, similar pricing behavior by a domestic producer might
be allowed or even encouraged, as it’s seen as a defense against foreign dumping. This creates a
contradiction the same conduct can be punishable under one law but acceptable under another. 186
186
Grasim Industries Ltd. v. CCI (2018); case showing how abuse of dominant pricing was penalized by CCI.
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8.2.3. The Need for Coordination

There is currently no legal requirement for the DGTR to consult with the CCI during
anti-dumping investigations. This leads to policy confusion and sometimes even conflicting
outcomes.

If the CCI were involved in reviewing the competitive effects of anti-dumping duties, they could:

 Warn against price manipulation or market concentration,

 Protect the interests of downstream industries and consumers,

 Help assess whether price undertakings would be better than outright duties.

Coordination would also help avoid cases where anti-dumping actions help inefficient
domestic firms at the expense of market efficiency and consumer welfare.

8.2.4. Scholarly and Global Perspectives

Legal scholars like Hoekman & Mavroidis and Mehta & Agarwal have argued that the
competition watchdog should play a greater role in reviewing trade remedies. They suggest that
anti-dumping law, as it currently stands, overlooks consumer impact, and can sometimes work
against the goals of competition law.

In advanced economies like the European Union, competition impact is sometimes

assessed before imposing duties a model India could follow.

8.3. Proposed coordination mechanisms, reforms, and amendments.

India currently treats anti-dumping law and competition law as two separate legal
systems, each with its own objectives and authorities. Anti-dumping law focuses on protecting
domestic industries from unfair foreign pricing (dumping), while competition law aims to ensure
a fair and efficient market that benefits consumers. However, when these two laws operate in
isolation, they can conflict, and the market suffers. Therefore, legal and policy reforms are
urgently needed to harmonize their functioning and make sure both consumer and producer
interests are protected

A. Mandatory Competition Impact Assessments

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 One of the most important reforms is to make it mandatory to assess the impact of anti-
dumping measures on market competition. Before imposing any duty, authorities should
evaluate:

 Will the duty increase prices for consumers?

 Will it give monopoly power to domestic companies?

 Will it harm industries that use the dumped goods as inputs?

This idea is supported by scholars like Mehta & Agarwal (2011), who found that India’s anti-
dumping measures often ignore competition impacts, especially in sectors like solar energy and
pharmaceuticals.

Similarly, Hoekman & Mavroidis (2011) have argued that even WTO rules should include
competition checks during anti-dumping reviews to prevent misuse of the system for
protectionism

B. Institutional Coordination Between DGTR and CCI

Right now, the DGTR (which handles anti-dumping cases) and the CCI (which enforces
competition law) work in complete isolation. There is no formal rule that they must share
information, consult each other, or coordinate decisions.

This gap leads to confusion. For example, DGTR might impose anti-dumping duties that help
a company become dominant, while CCI may later investigate that same company for abusing its
market position. To avoid such policy clashes:

 A coordinated protocol should be created between DGTR and CCI.

 In complex cases, a joint review team could be formed.

 Regular consultations should take place for high-impact sectors like steel, energy, and
telecom.

This would help ensure that anti-dumping duties are not harming the very competition that
India is trying to promote.

C. Legal Amendments

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 To make coordination effective, changes in the law are necessary. Reforms could include:

 Adding a provision in the Customs Tariff Act, 1975, or the Anti-Dumping Rules, 1995,
requiring a competition impact report as part of the investigation.

 Amending the Competition Act, 2002, to allow CCI to offer binding recommendations in
trade remedy cases.

This would institutionalize the CCI’s role in protecting consumer welfare during trade
remedy processes and prevent legal contradictions.

D. Capacity Building and Expert Training

Often, the lack of technical knowledge about the intersection of trade and competition laws
prevents better cooperation. DGTR and CCI staff must be trained in overlapping areas such as:

 Market structure analysis

 Pricing behavior

 Consumer welfare economics

Workshops, expert panels, and even inter-department exchanges can help build a shared
understanding and improve decision-making.

CHAPTER IX
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 CONCLUSION AND RECOMMENDATIONS

9.1. Conclusion

The research paper provides an insightful analysis of the interaction between anti-
dumping laws and competition laws, with a focus on the Indian legal framework. The primary
objective of anti-dumping laws is to protect domestic industries from unfair foreign competition,
specifically when goods are sold at prices below their production costs, referred to as "dumping."
In contrast, competition laws aim to maintain a fair and open market by regulating monopolies,
abuse of dominance, and ensuring that companies engage in healthy competition. This research
has identified that while these two sets of laws have distinct goals, their application often creates
conflicts that undermine market efficiency and harm consumers.

Through case studies and legal analysis, it became clear that anti-dumping laws, while
intended to shield domestic industries, can inadvertently reduce market competition, leading to
higher consumer prices and less choice. Furthermore, the imposition of anti-dumping duties can
sometimes result in complacency among protected industries, preventing them from innovating
or improving efficiency. This protectionist approach can contradict the core objectives of
competition law, which seeks to foster innovation, reduce market barriers, and keep prices low
for consumers.

The paper has also illustrated the complex relationship between the Competition Act,
2002, and the Customs Tariff Act, 1975. The intersection of these laws is often fraught with
contradictions, particularly in sectors where anti-dumping duties raise prices for consumers while
competition law seeks to ensure that no company dominates the market or engages in unfair
pricing strategies. The case studies, including the Cold-Rolled Steel Case and the Solar Panel
Case, serve as critical examples of how anti-dumping measures can have unintended
consequences, such as stifling competition and harming consumer welfare, which goes against
the principles of competition law.

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9.2. Recommendations

1. Mandatory Competition Impact Assessment

One of the most critical recommendations is the introduction of a mandatory competition

impact assessment before imposing anti-dumping duties. This would ensure that the potential
effects on market competition, pricing, and consumer welfare are evaluated before such
measures are implemented. By considering the broader market dynamics, this assessment can
help identify whether the benefits of imposing duties outweigh the long-term harms to
competition and consumers.

2. Enhanced Coordination Between Regulatory Bodies

There is a pressing need for better coordination between the Directorate General of Trade
Remedies (DGTR) and the Competition Commission of India (CCI). Currently, both bodies
operate independently, leading to potential conflicts when trade remedies and competition
concerns overlap. For example, the imposition of anti-dumping duties may protect domestic
industries but harm downstream industries or consumers. To address this, the roles of the DGTR
and the CCI should be better aligned, with both bodies working together to ensure that anti-
dumping measures do not undermine competition.

3. Sector-Specific Policies and Reforms

A more sector-specific approach should be considered when applying anti-dumping

duties. Different sectors may experience varied impacts from anti-dumping measures, and as
such, tailored policies could help mitigate negative outcomes. For example, in the case of solar
panels, anti-dumping measures have led to higher energy costs and slowed down renewable
energy adoption, contrary to India’s policy goals in the energy sector. Policymakers should
carefully assess the sectoral implications of anti-dumping duties and consider alternative
measures where necessary.

4. Consumer Welfare Focus

Anti-dumping laws must be reformed to include consumer welfare as a central

consideration. While the protection of domestic industries is important, it should not come at the
expense of consumers, who may face higher prices and reduced product choices as a result of
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anti-dumping duties. By ensuring that anti-dumping measures are implemented with a view to
balancing industry protection and consumer interests, India can better align its trade policy with
the broader goals of market efficiency and consumer satisfaction.

5. Judicial Review and Transparency

It is essential that there is greater transparency in the process of imposing anti-dumping

duties. The decision-making process should be open and accessible to stakeholders, including
consumers, downstream industries, and foreign exporters. Judicial review of anti-dumping
decisions should be strengthened to ensure that measures are based on sound evidence and legal
reasoning, rather than political or protectionist motives.

6. Reform of Anti-Dumping Legislation

The anti-dumping framework itself may need to be revised to align more closely with
competition law principles. For example, the current focus on protecting domestic industries can
sometimes lead to the overuse of anti-dumping duties, even when there is no clear harm to the
industry.

7. Promotion of Policy Coherence at the International Level

India should actively engage in international discussions aimed at harmonizing anti-

dumping and competition law frameworks. As global trade continues to evolve, it is essential that
India’s legal frameworks remain aligned with international best practices. Greater cooperation
with international bodies such as the World Trade Organization (WTO) and the Organisation for
Economic Co-operation and Development (OECD) could help India craft a more coherent policy
that balances trade protection with market competition.

By implementing these recommendations, India can create a more balanced and effective
framework that protects domestic industries while also ensuring fair competition, consumer
welfare, and overall market efficiency. This will not only strengthen the legal and economic
environment for businesses but also contribute to a more sustainable and competitive market for
consumers.

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