OFFICE OF THE DIRECTOR GENERAL (SAFEGUARDS)

NOTIFICATION

New Delhi, the 1 lth December, 2001

Sub : Review of Safeguard duty imposition on imports of Phenol into India from notifu

developing countries under Rule 18 of the Customs Tariff (Identification and Asses

ment of Safeguard Duty) Rules, 1997 (hereinafter referred to as the SGD Rules) rei

with Section 8B of the Customs Tariff Act, 1975—final findings.

GSR. 50(E).—Having regard to the Customs Tariff Act, 1975 and the Customs Tar

(Identification and Assessment of Safeguard Duty) Rules, 1997 thereof.

Introduction

The notice initiating investigation concerning import of Phenol into India

was issued on 02.02.99 under Rule 6 of the SGD Rules. Final findings were

issued under Rule 11(1) of the said Rules, (published in the Gazette of India

(Extraordinary) Part ll-Section-3-Sub-section (i)) on 11.06.99 recommending

safeguard duty to be imposed @ of 22% advalorem during the 1 year and @

of 15% advalorem during the 2 ^ year on imports of Phenol into India being the

minimum necessary for the protection of the domestic industry from he serious

injury threatened to be caused by the increased imports of Phenol. In'exercise

of powers conferred by sub section (1) of section 8B of the Customs Tanff Act,

1975(51 of 1975) read with Rules 12 and 14 of the SGD Rules and based on

the final findings of the Director General (Safeguards), the Central Government

vide Notification No.82/99-Customs dated 30^th June, 1999 imposed on Phenol

falling under sub-heading number 2907.11 of the First Schedule to the said

Customs Tariff Act, when imported into India, a safeguard duty at the rate of;

(a)22% when imported upto and inclusive of the 29^th day of February, 2000; and

(b)15% when imported from the 1^st of March, 2000 to 29^th day of June, 2001

(both days inclusive).

Further the said notification exempted, inter alia, levy of safeguard duty

on imports of Phenol from notified developing countries under Clause (a) of

sub-section (6) of Section 8B of Customs Tariff Act 1975, other than South

Africa.

THE GAZETTE OF INDIA : EXTRAORDINARY

[PART II—SEC, 3(i))

On an application filed before me under Rule 18 of the SGD Rules by

Hindustan Organic Chemicals Ltd. (HOC), Mumbai and Herdillia Chemicals

Ltd. (HCL), Mumbai for review of Safeguard duty imposed on imports of Phenol

into India to protect the domestic producers of Phenol against continued

serious injury caused by the increased imports of Phenol into India, a notice of

review was issued on 1st January 2001 and final findings were issued on

16.05.2001 and was published in the Gazette of India, Extraordinary on

20.06.2001

In exercise of powers conferred by sub-section (1) and (4) of section 8B

of the Customs Tariff Act 1975, read with rule 18 of the SGD Rules, the Central

Government vide Notification No. 73/2001-CUSTOMS dated 28^th June 2001,

after considering the aforesaid final findings in review, imposed safeguard duty

on imports of Phenol into India as under:

(a)

10%, when imported from the 30^th day of June, 2001 to the 29^th day of

June, 2002 (both days inclusive); and

(b)

7%, when imported from the 30^th day of June, 2002 to the 29^th day of

June, 2003 (both days inclusive).

The notification also exempted levy of safeguard duty on imports of

Phenol made from countries notified as developing countries under clause (a)

of sub-section (6) of section 8B of the said Customs Tariff Act.

It has been informed to the Department of Revenue, Ministry of

Finance, New Delhi that the imports of Phenol into India during April to early

September 2001 from Brazil, China, Korea, Singapore and South Africa

constituting

some of the notified developing countries listed in Notification

No.103/98-Customs dated 14.12.98 are much more than the de-minimis level

stipulated under Section 8B of the Customs Tariff Act 1975 to make them

eligible for availing

the exemption benefits extended by the aforesaid

Notification No. 73/2001-CUSTOMS dated 28^th June 2001. It has also been

stated that imports from South Africa and Singapore in July 2001 alone was to

the extent of 3551 tonnes, which worked out to more than 13% of the total

imports of Phenol during the year 2000-01. It has been requested that the

exemption from safeguard duty available to imports originating from these

developing countries may be revoked. Further, the consignments that have

escaped the levy, should also be subjected to safeguard duty.

The matter was examined and it appeared prima facie the imports of

Phenol from the aforementioned notified developing countries were more than

the de-minimis level stipulated under Section 8B of the Customs Tariff Act

1975. Accordingly it was decided to initiate review proceedings. The purpose

of the

review was to determine whether such notified developing countries

were eligible to the exemption from payment of safeguard duty on imports of

Phenol from these countries.

Procedure

The Notice of Review to consider whether safeguard duty on imports of

Phenol into India from notified developing countries should be exempted was

issued on 22.10.2001 and was published in the Gazette of India, Extraordinary

on 23.10.2001. A copy of the Notice was sent to all known interested parties to

make their views known and submit documentary evidence by 29^th November

2001 namely:-

Domestlc Producers

(i)

Hindustan Organic Chemicals Ltd (HOCL), Mumbai

(ii)

Herdillia Chemicals Ltd. (HCL), Mumbai

(iii)

Neyveli Lignite Corporation, Tamilnadu.

Importers/User Industries

(i)

C.J.Shah & Company, Mumbai

(ii)

Haresh Kumar & Company, Mumbai

(iii)

Vinmar International India Pvt. Ltd., Mumbai

(iv)

Sonkamal Enterprises,Mumbai

(v)

Khetan Brothers, Mumbai

(vi)

Xpro India, Mumbai

(vii)

Kesar Petroproducts Ltd., Mumbai

(viii)

Bakelite Hylam Ltd., Hyderabad

(ix)

Gargi Huttenes Albertus Private Limited, Mumbai

(x)

Alta Laboratories Ltd.,Dadar, Mumbai

(xi)

United Phosphorus Limited, Mumbai

(xii)

Colour Chem Limited, Balkum, Thane

(xiii)

Kitply Industries, Calcutta

(xiv)

Romit Resins Pvt. Ltd., Panvel

(xv)

Bilag Industries, Vapi

(xvi)

United Metachem, Pune

(xvii) Marvel Thermosets P. Ltd., Mumbai

(xviii) Daurala Organics Ltd., New Delhi.

(xix)

Century Laminating Co., Ltd., New Delhi

(xx)

Foseco India Ltd., Pune

(xxi)

Schnectady Specialities Asia Ltd., Mumbai

Exporters

(i)

Phenolchemie GmbH, Germany

(ii)

Enichem, Italy

(iii)

Georgia Gulf Corporation, U.S.A.

(iv)

Mitsui Chemicals, Tokyo/Mitsui & Co. Ltd., Singapore

(v)

Kumho Chemical Company, Seoul, Korea

(vi)

Taiwan Prosperity Chemical Company, Taiwan

(vii)

Merisol, South Africa, (Merichem Sasol)

2.1 £> C l j o % ^ 3

THE GAZETTE OF INDIA . EXTRAORDINARY

[PART II—SEC. 3(i)J

(viii)

Kolmar Petrochemicals AG, Switzerland,

(ix)

ICC Chemical Corporation, New York,

(x)

Tosoh Corporation, Tokyo

(xi)

Formosa Plastics Corporation, Taiwan

(xii)

Tricon Energy Ltd., U.S.A.

Overseas Associations '

(i)

Chemical

Safety Management Centre, Japan Chemical Industry

Association-JCIA,Tokyo 100, Japan,

(ii)

Chemical and Allied Industies Association -(CAIA) Auckland Park 2006,

South Africa,

(iii)

Korean Petrochemical Industry Association -(KPIA) Chongno-ku, Seoul,

Korea,

(iv)

Petrochemical Industry Association

Taiwan (PIAT) Section 4,

Chutung, Hsinchu, Taiwan.

(v)

Chemical Manufacturers Association (CMA) Virginia-22209, USA .

(vi)

Verband der Chemischen Industrie - VCL Germany

Indian Associations

fi)

Society of Thermosetting Industries, Mumbai

(ii)

Indian Laminates Manufacturers Association, Mumbai

(iii)

Indian Chemical Manufacturers Association, Mumbai

(iv)

All India Association of Industries, Mumbai

A copy of the notice of review was also sent to the governments of

exporting countries through their High Commissions/Embassies in New Delhi

namely Belgium, Chinese Taipei, Germany, Italy, Japan, Korea DPR, Korea

RP, the Netherlands, Russia, Singapore, South Africa, U.K., USA and to the

European Union, Delegation of the European Commission in India, New Delhi.

Replies to the Notice dated 22.10.2001 were received from the following

parties:-

Domestic Producers

(i)

Hindustan Organic Chemicals Ltd., Mumbai

(ii)

Herdillia Chemicals Ltd., Mumbai

Importers/User Industries

(i)

Kesar Petroproducts Ltd., Mumbai

(ii)

Foseco India Ltd. Pune

Exporters

(i)

Mitsui Phenol Singapore Pte. Ltd., Singapore

(ii)

Ineos Phenol GmbH & Co.KG, Deutschland, Germany

(iii)

EniChem Pacific Limited, Italy.

Indian Associations

(i)

All India Association of Industries, Mumbai

Views of Exporters

The following main points have been made by the exporters:

(a)

Mitsui Phenol Singapore PTE. Ltd., Singapore

(i)

Phenol acts as a barometer indicating the strength of the overall industry

of a country. Phenol has been used commercially from the beginning of

20^th century, and now Phenol is consumed by many industries around

the world and the demand continues to grow.

(ii)

Phenol demand in India exceeds the total output of the two producers in

India and the estimated demand in India is about 9000 to 10000 tonnes

per month as against production of about 5000 to 6000 tonnes per

month.

(iii)

They do not think the domestic producers are damaged by imports and

in bet the foreign Phenol suppliers cover the shortage at internationally

competitive prices.

(iv)

The increase of Phenol imports from Singapore would be in accordance

with the interest of customer in India .

(v)

The exemption clause of the safeguard needs to be retained in view of

the spirit of the fair trade and that the safeguard duty itself should be

abolished as soon as possible for the national interest of India.

(b)

Ineos Phenol, Germany

(i)

There should be no disparities in the duty structure and they expect a

uniform level playing field. They have requested to revoke the safeguard

duty exemption on imports of Phenol originating from few of the

developing countries and also levy safeguard duty on the consignments

which have escaped the levy.

(c)

EniChem Pacific Ltd., Italy

(i)

They have never been a major or a regular supplier of Phenol to the Indian

market and only very small quantities have been exported to India at European

prices. They have requested for exemption from safeguard duty on export made

by them.

216GI/2002—4

THE GAZETTE OF INDIA EXTRAORDINARY

|PART 11—Sec 3(i)1

Views of Importers/User industries

(a)

M/s. Kesar Petroproducts Ltd., Mumbai

(b)

M/s. Foseco India Ltd., Pune

They have stated broadly the following:

(a)

As per the notice, the purpose of the review is stated to be to determine

whether such notified developing countries are eligible to the exemption for

payment of safeguard duty on imports of Phenol from these countries. In their

view it is necessary to redefine the scope of the review and to widen it to

determine ab-initio whether basically there is proper justification for continuing

the safeguard duty protection on imports of Phenol in future.

(b)

There is a basic change in the status of one of the manufacturers of

Phenol namely Herdillia Chemicals Limited due to its management and control

being taken over by a Multi-national Corporation, Schenectady Corporation,

USA which is a major consumer of Phenol in India and outside India 37.5% of

the country's Phenol manufacturing capacity has become captive to the

multinational and gone out of reach of other Phenol consumers in the country.

(c)

The most important component of manufacturing cost of Phenol namely

the cost of its raw materials has undergone a major change which is favourable

to the Phenol manufacturers. The prices of raw materials and furnace oil have

substantially come down.

(d)

Both the manufacturers of Phenol are continuing to make high profits

and covering up losses in their other product lines at the cost of consumers of

Phenol who are facing a serious threat of closure of their operations.

(e)

The grounds on which the domestic producers applied for extension of

period of SGD do not exist today.

(f)

The imports of Phenol during the period from April to early September

2001 were more because of less production by one of the manufacturers of

Phenol (HOCL) in the country and is a temporary phenomenon which does not

call for review of exemption granted to imports from developing countries.

During the same period i.e. from April to September 2001 the other

manufacturer of Phenol namely Herdillia could produce 15600 MT of Phenol

against its pro-rata capacity of 17000 MT (capacity utilisation of 92%) thus did

not face any marketing constraint which shows that HOCL's reduction in

production was due to its own problem other than marketing.

(g)

Herdillia itself imported Phenol to the extent of 2222 MT in the year

2000-01 which was much higher than their import of 951 MT in the year 1999-

2000. Though the imports may be duty free being for export purposes, Herdillia

had to pay ocean freight of about US$ 70 MT and other costs of clearing,

storage etc.

(h)

Herdillia finds it worthwhile to import Phenol rather than use its own

production which means that the margin on its own production is more than the

cost on ocean freight, clearance charges etc.

(i)

Herdillia exports the products based on Phenol viz. Dodecyl & other alkyl

Phenol, Isophorone & Diacetone Alcohol which are the products manufactured

by Schenectady. With the take over of Herdillia by Schenectady it is feared that

huge quantities df these Phenol-based products shall be manufactured in India

and exported. This will result in less availability of Phenol to other consumers in

the country to that extent and widen the demand supply gap for Phenol.

(j)

There is no justification at all for«removing the exemption granted to

imports of Phenol made from developing countries since imports of Phenol

were higher due to less production of Phenol in the country. Thus the Phenol

consumers would have suffered a major set back if the benefit of importing from

developing countries would not have been there.In the final findings dated

16.05.2001 it was acknowledged that there is a demand/supply gap of 12000

MT in the first year and 12,500 MT in the second year and hence these

quantities were recommended to be exempted from safeguard duty.lt is

submitted that to the extent of these gaps, it is necessary to permit import of

Phenol free of SGD and hence there is no case to remove the exemption

granted in the Notification No.73/2001 dated 28.6.2001 for imports from notified

developing countries, at least to the extent of the above gaps.

In addition to the above M/s Kesar Petroproducts have reiterated their

submissions made by them during the earlier review carried out.

Views of the Association

The All India Association of Industries, Mumbai

(i)

Recently, a Customs Notification bearing No. 73/2001 Customs dated

28^th June 2001 has been issued which extends the safeguard duty period on

Phenol by two years. This decision was based on the application made by

Herdillia Chemicals Ltd. which has resulted in major gain to HCL.

(ii)

In the Public Offer document issued by Schenectady (India) a subsidiary

of Schenectady USA for acquiring shares of Herdillia Chemicals Holdings

Limited (HCL) it may be seen that by this public offer Schenectady India will

virtually be the sole shareholder of the HCL. HCL is one of the two

manufacturers of Phenol in the country. Schenectady is one of the largest

consumers of Phenol in the world and has already established the facility for

manufacturing nonyl phenol in India of which it is now the sole manufacturer in

the country.

(iii)

It will be appreciated that once the acquisition of HCL by Schenectady is

complete it will have monopolistic control on Phenol both as its manufacturers

THE GAZETTE OF INDIA : EXTRAORDINARY

[PART II—SEC. 3(i)]

and a major consumer which is likely to be misused against the interest of

Phenol based industries in the country which are mainly in small and medium

sector and are struggling to continue to run their plants with great difficulties

due to reduction in import duty of its own end products.

(iv)

In the background of the above developments there is a strong case to

examine once against the issue of Safeguard duty imposed on Phenol under

the Notification dated 28.06.2001, in spite of objections filed by all the Phenol

based industries in India.

(v)

The Central Government had originally imposed safeguard duty on

Phenol vide Notification No. 8*99-Customs dated 30^th June 1999. This

notification was based on the final findings of the Director General (Safeguard)

dated 12^th May 1999. In the said final findings it was noted by DG(Safeguard)

that HCL had represented that they would carry out certain modifications in the

Phenol plant to achieve reduction in cost by which the extension of Safeguard

duty will not be required.

spite of such assurance HCL made a joint

application of DG Safeguard for review of Safeguard duty beyond 29^th June

2001. In spite of objections raised by Phenol users, DG Safeguard, by its final

findings dated 16^th May 2001 recommended extension of Safeguard duty on

Phenol at lower rates and recommended that certain quantity of Phenol be

exempted from such duties since imports of Phenol upto that level were

considered unavoidable due to supply and demand gap in the country. The

government by its notification No.73-2001 Customs dated 28^th June 2001

however, extended the Safeguard duty on Phenol at lower rates for the period

from 30^th June 2001 to 29^th June 2003 without allowing quantitative exemption

but providing that the import under advance licence as well as imports from

developing countries will be exempted from such safeguard duty.

(vi)

It is significant to note that Schenectady India itself had filed its objection

with DG (Safeguard) to extension of Safeguard duty on Phenol stating that it

would make manufacture of Phenol based products uncompetitive.

(vii)

Due to Schenectady's acquisition of HCL the situation in Phenol market

is completely changed which was not covered by the review of DG Safeguard &

hence there is no justification for continuing the Safeguard duty on Phenol in

future. The entire matter be reviewed for discontinuing the Safeguard duty on

Phenol for future to protect the interest of Phenol based industries in the

country.

(viii)

Pending such review of Notification No.73-2001 Customs dated 28^th

June 2001 the exemptions included in the said notification for the imports of

Phenol from the countries notified as developing countries may not be removed

under any circumstances since it will deprive the Phenol based industries of any

opportunity to importing from such countries to face the monopolistic control on

domestic Phenol manufacture

and in the interest of the small scale Phenol

based industries so that they get a level playing ground and do not suffer a final

blow to their existence.

Views of domestic producers

The domestic producers have made the following main points:

(i)

The purpose of the extension of the period of Safeguard Duty was to

keep in check the level of imports of Phenol that had caused Serious Injury to

the domestic Phenol producing industry. However, despite the extension of the

period, contrary has happened. Imports have increased significantly. The

imports in approximately the first quarter of the extended period (i.e. 1^st July to

4^th October 2001) were as high as 23,044 Tons as against 26, 442 Tons in the

whole year 2000-01with sharply declining prices.A significant portion of these

imports (7899 Tons from 1^st July 2001 - 4 October 2001) has come in from

'developing countries' such as Singapore and South Africa. Presently, on

imports from these countries, no Safeguard Duty is being levied (due to the

exemption granted) despite the share of each of these two countries being

individually more than 3%.

(ii)

As per Section 8B of the Customs Tariff Act, Safeguard Duty is not

leviable on imports from a developing country only so long as the share of

imports from that specific country is less than 3% of the total imports. The

exemptions for levy of Safeguard Duty have been granted only so long as the

share of imports does not cross the levels mentioned above. The countries

Singapore and South Africa fall in the list of developing nations covered in the

Notification of the Government of India No. 103/ 98 dated 14^th December 1998.

Ot these, South Africa has always been a large producer of Phenol and a major

exporter of Phenol to India. The share of imports from South Africa (a

de^yjjdpping country) was as high as 33.80 % (in the year 1998-99).The share

came down to 4% (during the period April 1999 to March 2001) only due to

Safeguard Duty being a deterrent for Phenol imports from South Africa. Such

exemption was granted possibly because, for a very brief period (i.e. April 2000

to March 2001, when Safeguard Duty was in force), the share of Phenol imports

from South Africa was less than 3%. During the approximate six month period

of 1^st April 2001 to 4^th October 2001, imports from South Africa are reported to

be 2349 Tons. If this figure is compared with total imports (from all sources)

30,380 Tons for the same period, the share of South Africa works out to 7.73%

(which is well above the de-minimis level of 3%). Even if the six month import

figure is compared with total average annual imports of previous two years

(1999-2000 and 2000-01) of 27,872 TPA, the share of South Africa works out to

over 8.4%. As percentage of last fiscal year's import (of 26,442 Tons), the share

of South Africa works out to over 8.8%. Safeguard Duty should be levied on

Phenol imports from South Africa immediately and with retrospective effect.

(iii)

Earlier, in 1999, there was no major possibility of Phenol import from any

developing country other than South Af^r'ca. However, Singapore is now

emerging as a major exporter of Phenol to J^dia as Mitsui has commissioned its

large Phenol plant in Singapore during July 2001. There is no significant local

THE GAZETTE OF INDIA : EXTRAORDINARY

[PART II—SEC. 3(i)]

market for Phenol in Singapore (except for some quantities being consumed for

manufacture of Bisphenol-A) and the nearest market for this Mitsui facility is

India. Exports from this country to India have therefore started coming in at

drastically low prices and in large quantities. Within a quarter of commissioning

of a large capacity for Phenol in Singapore (in July 2001), there has been a

flood of imports from Singapore, the share of which has already crossed well

beyond 3% of the total imports. Large Phenol parcels have arrived on the Indian

shores from Singapore during the period between 1^st July 2001 to 4^th October

2001. During the approximate three month period starting from 1"' July 2001,

imports from Singapore are reported to be 7066 Tons. If this figure is compared

with total imports (from all sources) of 23,044 Tons for the same period, the

share of Singapore works out to 30.66% (which is well above-the de-minimis

level of 3%). Even if the three month import figure is compared with total

average annual imports of previous two years (1999-2000 and 2000-01) of

27,872 TPA, the share of Singapore works out to over 25%. As percentage of

last fiscal year's import (of 26,442 Tons), the share of Singapore works out to

over 26%.

(iv)

The imports of Phenol from South Africa and Singapore have individually

crossed the de-minimis levels, they have requested the Govt, of India to issue

a notification making Safeguard Duty applicable on import of Phenol from

Singapore and South Africa.

(v)

The flood of imports from these two countries at low prices and without

attracting Safeguard Duty has caused grave harm to the domestic Phenol

manufacturers. Inventories have piled up. In fact, soon after the flood of imports

from Singapore started, the stocks of Phenol mounted and the combined stock

of both companies put together was 2861 Tons towards the end o%***gust

2001. The facility of Hindustan Organic Chemicals Ltd. was shut down

(between 4^th to 19^th September 2001) and Herdillia may have to follow suit very

soon in view of high stocks of Phenol of 1009 Tons (bulk plus packed

combined) as on 28^th October 2001.

(vi)

Imports of Phenol have come in at still lower prices than the prices

prevailing during April 2000 to March 2001.

Both the Indian Phenol

manufacturing companies have therefore had to reduce their Phenol prices.

(vii)

They have also requested to levy Safeguard Duty on Phenol imports

from South Africa and Singapore at least on a provisional basis besides levy of

Safeguard Duty on Phenol imports from Singapore and South Africa with

retrospective effect.

Findings

I have carefully gone through the case records and replies filed by all the

interested parties including the domestic producers, users/importers and

exporters. A number of issues have been raised by various parties, which have

no direct bearing on the scope of the present proceedings which has been

made amply clear in the notice of review. It was clearly mentioned that it

appeared prima facie the imports of Phenol

from the notified developing

countries were more than the de-minimis level stipulated under Section 8B of

the Customs Tariff Act 1975 and the interested parties were asked to make

their views known and submit documentary evidence. The purpose of the

review was to determine the share of developing countries in the total imports of

Phenol eligible to the exemption from payment of safeguard duty on imports of

Phenol from these countries.

As regards the imports of Phenol into India during the period 1998-99,

1999-2000 ,2000-01 and 2001-02(upto September 2001) it is observed that the

countries mentioned in the Table below exported Phenol to India during the said

period. The data for the period 1998-99 and 1999-2000 has been taken from

DGCIS Calcutta and for the period 2000-01 and 2001-02 (upto September

2001) is based on the data furnished by the applicants which has been duly

verified with the DGCIS and Kandla Customs. On the basis of the verified data,

the share of various Countries/ Territories in the total imports of Phenol into

India is determined as per table below :

Share of various countries in Imports of Phenol into India

Imports in MT

1998-99

1999-2000

2000-01

2001-02(9/01)

Country/territory

Quantity

%age

Quantity

%age

Quantity

%age

Quantity

%age

China PR

lM6~

0.03

117.667'

0 40

40.1)00

016"

European

85.735

0.34

16493.150

56.29

7348.301

27.79

8059.231

31.16

Community

Israel

20.500

0.07

Japan

-5911.450

23.45

849.716

2.90

1014.139

3.83

76.400

0.30

Korea RP

9762.106

38.72

16.000

0.05

Malaysia

1570.000

6.07

Mexico

100.000

0.34

-_-_

Russia

36.000

0.14

895.046

3.05

--_

South Africa

8522.457

33.80

2165.344

7.40

374,000

1.41

2020.124

7.81

Singapore

16.000

0.06

72.600

0.25

41.400

0.16

8071.483

31.21

Switzerland

0.100

28.000

0.09

--__

Saudi Arabia

108.000

0.37

296.400

1.15

Taiwan

809.505

3.21

231.850

0.79

3550.420

13,43

3779.886

14.62

"USA

62.645

0.25

8204.216

28.00

14114.732

53.38

1947.000

7.52

Total

252~1L999~

100~ 29302.089'

100 "26442.992

J00~ 25860.524"

100

It is pertinent here to reproduce the provisions of Section 8B of the

Customs Tariff Act 1975 which empowers the Government to impose

Safeguard duty in accordance with the provisions of the said section.

"If the Central Government after conducting such enquiry as it deems fit,

is satisfied that any article is imported into India in such increased quantities

and under such conditions so as to cause or threatening to cause serious injury

THE GAZETTE OF INDIA : EXTRAORDINARY

[P^RI II—Sbc. 3(i)l

to domestic industry, then it may, by notification in the Official Gazette, impose

a safeguard duty on that article.

Provided that no such duty shall be imposed on article originating

from a developing country so long as the share of imports of that article

from that country does not exceed three percent or where the article Is

originating from more than one developing countries then, so long as the

aggregate of the Imports from all such countries taken together does not

exceed nine percent of the total imports of that article into India."

It is observed from the above tabulation that the share of following

ueveloping countries (notified under Notification No. 103/98 -Cus dated

14.12.1998 as amended by Notification No. 62/99 dated 13.5.99 ) in the import

of Phenol into India during the first half of 2001-02(April- Sept.) has been 3% or

Malaysia, South Africa and Singapore.

Accordingly, it is recommended that imports of Phenol into India from

these notified developing countries be subjected to safeguard duty leviable

thereon.

The total share of notified developing countries, having individual share

of less than 3% in the import of Phenol into India, does not account for 9% or

more collectively and accordingly, it is recommended that imports of Phenol

from such notified developing countries may not be subject to safeguard duty.

[F. No. SG/lNV/2/98-(Rev.)]

R. K. GUPTA, Director General

Printed by the Manager, Govt of India Press, Ring Road, Mayapuri, New Dclhi-110064

and Published by the Controller of Publications, Delhi-110054.