In the matter between:
INTERNATIONAL TRADE ADMINISTRATION COMMISSION
Applicant
and
SCAW SOUTH AFRICA (PTY) LTD Respondent
In re
SCAW SOUTH AFRICA (PTY) LTD Applicant
and
INTERNATIONAL TRADE ADMINISTRATION COMMISSION
First Respondent
MINISTER OF TRADE AND INDUSTRY Second Respondent
MINISTER OF FINANCE Third Respondent
BRIDON INTERNATIONAL LIMITED Fourth Respondent AFRICAN MARITIME SERVICES (PTY) LTD Fifth Respondent
NU-QUIP CC Sixth Respondent
BRIEF SUBMISSIONS ON BEHALF OF BRIDON INTERNATIONAL LIMITED IN RESPONSE TO DIRECTIONS ISSUED ON BEHALF OF THE
CHIEF JUSTICE DATED 15 JULY 2009
1. The directive from the Chief Justice dated 15 July 2009 was directed inter alia to Bridon International Limited, fourth respondent in the High Court (hereinafter referred to as “Bridon”). Bridon is of the opinion that
it indeed has relevant information and submissions to make which should be taken into account when this Honourable Court considers whether it is in the interests of justice that an appeal against the orders of the High Court should be heard at this stage.
2. Bridon is aggrieved by the orders issued by the High Court as these orders seriously prejudice Bridon on an ongoing basis, and were, with respect, not justified nor did the High Court have the power to make such orders. If it was not for these orders the anti-dumping duties of 42,1% would no doubt have been terminated on 13 February 2009, being the date when the Minister of Finance implemented the remaining proposals of ITAC, by amending the second schedule to the Customs and Excise Act.
TWO MAIN CONTENTIONS SUMMARISED
3. It is submitted on behalf of Bridon that there are two main reasons why the appeal should be heard despite the fact that the review application is still pending in the High Court:
3.1. It is contended that the High Court had no jurisdiction to have made the orders. The orders in substance extend the duration of the anti-dumping duties. After 18 months the sunset review
cannot be continued with. A court has no power to extend such statutory period. (See by way of analogy Hartman v Minister van Polisie 1983 (2) SA 489 (A) at 496F—497D and 498E—F, See also Mohlomi v Minister of Defence 1997 (1) SA 124 (CC) where the provisions of section 113(1) of the Defence Act were struck down because the court had no discretion to extend the period. I also refer to Phillips and others v NDPP 2006 (1) SA 505 (CC) at 522, paragraphs 51 and 52).)
As a matter of principle orders which are invalid for lack of jurisdiction should be adjudicated as soon as possible, and should not be allowed to continue to prejudice Bridon and others as result of anti-dumping duties which should not be paid.
3.2. Even if the High Court could have issued the orders, there are three special circumstances which cause it to be in the interest of justice to immediately reconsider on appeal the orders issued by the High Court:
3.2.1. The orders in this case, other than in the case of most ordinary interim interdicts, cause extremely large losses of profits for Bridon. These are ongoing, ever increasing losses, which cannot be recovered in
due course, and about which no further litigation is possible. Only a successful appeal to this Honourable Court can stop these losses to continue to increase.
3.2.2. The WTO Anti-Dumping Agreement to which South Africa is bound, recognises the harsh effects of anti- dumping duties, and requires countries to provide for
“prompt” judicial reviews of administrative decisions which adversely affect foreign suppliers. It follows that where orders of court adversely affect Bridon in the same way as the original imposition of anti- dumping duties, the same need for a prompt review by a court of appeal of a judgment by a single judge exists.
3.2.3. As South Africa is duty bound to terminate anti- dumping duties as soon as they are no longer required to protect the local industry (see WTO Anti- Dumping Agreement article 11.1) it is in the interests of justice that a court of appeal should reconsider whether or not there exists any real danger that Bridon will dump product in the interim period whilst the review proceedings are pending. If
not, as Bridon contends (and as ITAC has found) then the Ministers should not in the interim remain prohibited from lifting the anti-dumping duties applicable to Bridon’s products. It is submitted that it is an ongoing duty of all organs of State, including the courts of law, to consider whether at any stage, anti- dumping duties are necessary to prevent dumping or not. Dumping duties in their nature are time-bound and have serious effects on foreign suppliers.
Furthermore, how these duties are dealt with by countries affects international trade relations.
4. The above submissions will now be motivated succinctly.
5. THE COURT HAD NO POWER TO EXTEND THE DURATION OF THE ANTI-DUMPING DUTIES
5.1. The main principle of the WTO Anti-Dumping Agreement in respect of duration of anti-dumping duties is contained in article 11.1 which reads as follows:
“An anti-dumping duty shall remain in force only as long as and to the extent necessary to counteract dumping which is causing injury.”
5.2. Article 11.3 then provides that anti-dumping duties shall in any event terminate after 5 years.
5.3. Article 11.3 qualifies the finality of the 5 year termination date, in that it may be extended for the duration of a sunset review.
5.4. The South African legislation provides in regulation 20 that all investigations and reviews “… shall be finalised within 18 months after initiation”.
5.5. It is contended that any continuation of a sunset review after 18 months is therefore contrary to the law and would be void. It can thus no longer extend the duration of the anti-dumping duties.
5.6. South Africa is thus obliged to withdraw the anti-dumping duties.
5.7. As a court has no power to extend statutory time periods, the High Court erred in interdicting the Ministers from terminating the anti-dumping duties. See Hartman v Minister van Polisie 1983 (2) SA 489 (A) at 496F—497D and 498E—F. See also
Mohlomi v Minister of Defence 1997 (1) SA 124 (CC) where the provisions of section 113(1) of the Defence Act were struck down because the court had no discretion to extend the period.
See also Phillips and others v NDPP 2006 (1) SA 505 (CC) at 522, paragraphs 51 and 52).)
5.8. It is contended that South Africa is duty bound to terminate the existing duties. If needs be, new anti-dumping duties can be imposed if the authorities wish to protect the local industry, provided there is evidence of a probability of dumping. Fresh provisional anti-dumping duties can, if needs be, be imposed within 60 days in terms of the regulations.
5.9. It is submitted that this issue is a constitutional issue of great importance. Jurisdiction goes to the root of the orders. See Moch v Nedtravel (Pty) Ltd 1996 (3) SA 1 (A) at 9G and 10E- H and the authorities referred to therein. See also Ndlovu v Santam Limited 2006 (2) SA 239 (SCA) par 9 at 246C—F.
This issue will not again be reviewed by the High Court in the review application or at any other stage.
5.10. In the result, on this basis alone, the fact that a review is still pending in the High Court should not prevent this matter from being heard on appeal in this Honourable Court.
6. The alternative ground will now be dealt with under the heading of the three cumulative considerations.
THE HUGE ONGOING LOSSES SUFFERED BY BRIDON
7. As appears from SCAW’s own affidavits the present anti-dumping duties of 42,1% to a great extent exclude Bridon from the SACU market.
8. The loss suffered by Bridon resulting from the orders of the High Court is already enormous and will continue to increase for as long as those orders remain in place.
9. Particulars of Bridon’s damages are contained in the sworn statement of Stephen Bates attached as annexure “A” to the affidavit of mr BF van der Merwe. As appears there from on average there is a loss of profits of at least R500,000 to R1 million per month.
10. It is not only Bridon which is seriously prejudiced by the orders, but also the existing Southern African customers of Bridon who have to pay 42,1% anti-dumping duties on their purchases from Bridon on top of the normal prices charged by Bridon for its products. This is also irrecoverable.
11. Furthermore, potential purchasers who, as a result of the extremely high anti-dumping duties cannot afford to make use of the high quality and safe products of Bridon are also prejudiced in that they have to purchase from other suppliers less suitable products.
12. It is contended that the loss of profits suffered by Bridon as a result of the High Court orders so far, i.e. since 13 February 2009 up to 23 July 2009, are already much higher than the amounts in dispute in many matters which, on a regular basis, serve before the highest courts of South Africa and in appeals also to this Honourable Court. These losses, moreover, are ever increasing and will continue to increase for a long time to come – unless the orders of the High Court are set aside on appeal by this Honourable Court.
13. It is contended that it is in the interests of justice, under the exceptional circumstances where an interim interdict causes such huge ongoing and ever increasing losses to a party, which cannot be recovered later
from anyone, that an appeal should be heard as soon as possible. No appeal on this basis can be launched after the adjudication of the review which is presently pending in the High Court, because this issue is not an issue in the review.
SOUTH AFRICA IS DUTY BOUND TO PROVIDE FOR PROMPT JUDICIAL REVIEW OF MEASURES ADVERSELY AFFECTING FOREIGN SUPPLIERS
14. Article 13 of the WTO agreement reads as follows:
“Each member whose national legislation contains provisions on anti-dumping measures shall maintain judicial, arbitral or administrative tribunals or procedures for the purpose, inter alia, of the prompt review of administrative actions relating to final determinations and reviews determinations within the meaning of article 11. Such tribunals and procedures shall be independent of the authorities responsible for the determination or review in question.”
15. It is submitted that the above requirement proves that the international commercial community recognises the importance of prompt judicial attention to anti-dumping measures. This is thus a factor which this Honourable Court can take into account in determining whether it is in the interests of justice to hear the ITAC appeal at this stage.
16. It is submitted that the South African judicial dispensation accepts that single judges do from time to time err – especially when matters are heard on an urgent basis: It is contended that it is in the interests of justice that such decisions should be rectified where they concern the duration of anti-dumping duties – with all the serious consequences thereof.
17. It is submitted that an appeal only after the review proceedings have been completed will not qualify as “prompt” justice to protect the legitimate concerns and interests of Bridon.
18. It is pointed out that an appeal at the end of the review proceedings will only deal with the correctness of the ITAC decision, and will not address the termination of the anti-dumping duties on a “prompt” basis.
SOUTH AFRICA, INCLUDING ITAC AND THE SOUTH AFRICAN COURTS, ARE DUTY BOUND TO CONSIDER ON AN ONGOING BASIS WHETHER IT IS NECESSARY TO KEEP THE ANTI-DUMPING DUTIES IN PLACE
19. As was pointed out in the papers filed by Bridon in the High Court it is the policy of Bridon not to dump product into SACU or any other country, and it does not intend to do so in future. SCAW thus is not exposed to a danger of suffering damages as result of a termination of the anti-dumping duties imposed upon Bridon at present. This is especially so for the period when a review is pending. However, any conceivable prejudice for SCAW is for more than one reason not comparable to the damage suffered by Bridon:
19.1. Firstly, the undisputed evidence of the fifth respondent in the High Court (African Maritime Services) was that it was not SCAW but other foreign distributors of product which took over the market share of Bridon in respect of South African flagged fishing vessels when the duties were imposed upon Bridon during 2002. This remains to be the situation. Bridon believes that this is also the case in respect of many other products which would have been sold by Bridon into SACU if it was not prevented from doing so by the high anti-dumping duties.
19.2. Secondly, SCAW would have another remedy, namely to ask ITAC to impose provisional anti-dumping duties in the unlikely event that Bridon should commence with any dumping activities.
20. The High Court, however, in its judgment of 5 January 2009, did not really consider the balance of convenience because the court approached the matter on the basis that SCAW had made out a clear right and was therefore entitled to its order. However, when leave to appeal was considered the court a quo was persuaded that there were good prospects of success on appeal. This implies that this “clear right”
after all appeared to be open to considerable doubt – even to the court a quo. However, the honourable Judge then changed his mind in
respect of the finality of the orders and held that the orders were not appealable, despite the good prospects of success. In the result the issue of a balance of prejudice was never properly taken into account.
21. It is submitted that the balance of convenience clearly favours Bridon and that this aspect was never considered properly.
22. However, it goes further than merely considering the balance of convenience. The High Court should have asked the question whether it is necessary at this stage to retain the anti-dumping duties, within the contemplation of article 11.1 of the WTO agreement. It should, with respect, not have prohibited the Ministers to terminate the anti-dumping duties in respect of Bridon in the absence of proof (as opposed to mere
speculation) that Bridon would probably dump product into SACU pending the review.
23. It is submitted that whereas Bridon has a right to the termination of the anti-dumping duties immediately when no need for such duties remains (se article 11.1 of the WTO Anti-Dumping Agreement), and where ITAC and the Ministers have a duty to immediately terminate such duties if they are no longer necessary, that it is in the interests of justice for this Honourable Court to determine as soon as possible whether the High Court erred in effectively prohibiting the Ministers from complying with their duties in terms of the WTO agreement.
24. It is submitted that this aspect can also affect international trade relations.
25. CONCLUSIONS
25.1. It seems to be common cause that a constitutional issue or issues are involved in this matter. See the SCAW affidavit, paragraph 43.1. It is also common cause that the criteria for leave to appeal are determined by prospects of success and the interests of justice. See Minister of Health v Treatment Action Campaign (No 1) 2002 (5) SA 703 (CC) at page 710,
paragraph 12 wherein it was accepted that in some instances an appeal against an interim order which is not a judgment could be allowed, especially where a party suffers irreparable harm as result of the interim orders.
25.2. It is thus submitted that the fact that this is an interim order should not, as such, prevent this matter from being heard prior to the review application which is pending in the High Court and which may remain pending for an extremely long time. On the contrary it is submitted that there are special circumstances which call for an appeal to be heard immediately.
25.3. If it is correct, as is contended for by ITAC and Bridon, that the High Court had no power to extend the maximum duration of anti-dumping duties, orders having such an effect should urgently be set aside.
25.4. It is contended that there is no justifiable reason why a party should be prevented from having a court of appeal reviewing the reasoning of a single judge, which is causing serious ongoing harm to a party. It is contended that such an appeal is required more seriously and indeed urgently, than in a case of
a damages claim which is historic and where the damages are not ever-increasing until the appeal is being adjudicated.
25.5. This matter is also different from the ordinary interim interdict matters in that a country like South Africa, and thus ITAC, is duty bound to cause the termination of anti-dumping duties as soon as such duties are no longer necessary to protect the local industry against a threat of dumping from, in this case, Bridon. Article 11.1 of the WTO agreement reads as follows:
“An anti-dumping duty shall remain in force only as long as and to the extent necessary to counteract dumping which is causing injury.”
25.6. In the result ITAC, and indeed South Africa as a country, has a duty to cause the immediate termination of the existing anti- dumping duties against Bridon, as there is no danger that Bridon will dump product into SACU. Bridon contends that South Africa is presently in breach of its duties to terminate the anti-dumping duties. Bridon contends that this is a consideration which in its own right merits a reconsideration of the situation by this Honourable Court as soon as possible.
SIGNED AT PRETORIA ON THIS 23RD DAY OF JULY 2009.
VAN DER MERWE ATTORNEYS Attorneys for Applicant
Block C3
Waterkloofrand Corporate Park, 356 Buffelsdrift Street,
Erasmusrand PRETORIA
Tel : 012 367 5757 Ref: BRI2/00001/SJ
