CIT interim relief for shrimp exports

Indian shrimp exporters to US have a sigh of relief for the second time in just three weeks as the US Court of International Trade [ CIT] has issued a preliminary ruling that the additional bonding requirements imposed by US Customs and Border Protection [CBP] on shrimp imports are contrary to law.

CIT has ruled a temporary injunction over the decisions of CBP in this regard.

In last week of November the dispute settlement body of World Trade Organisation [WTO] had constituted a panel to examine the impact of anti-dumping duty and customs bond imposed on shrimp imported from countries like India, Thailand, China, Ecuador, Vietnam and Brazil, upholding requests of India and other nations.

Marine products export to the US had seriously hit by the imposition of 10.17 per cent anti-dumping duty and customs bond as there had been a drop by 23.43 percent in the exports to the US during April - September period of current fiscal.

Value realisation in rupee terms had plummeted by 14.32 per cent, from Rs 896.17 crore in the same period in last fiscal to Rs 768 crore.

The recent ruling was in response to a suit filed by the US National Fisheries Institute [NFI] challenging CBP's requirement that companies importing shrimp should obtain a continuous entry bond in the amount of their anti-dumping duty in addition to posting the cash deposits themselves.

This had caused an effective requirement of double the amount of security required under anti-dumping law. NFI argued that shrimp importers were uniquely and unfairly singled out for this additional bonding requirement.

In August 2004, CBP implemented a policy that required importers of agriculture or aquaculture products were subjected to duties to post bonds equal to the value of shipments imported during the previous 12 months.

In December, 2005 NFI had filed a suit and pleaded for an injunction against CBP's actions. CIT has now ruled a preliminary injunction and NFI will soon move to the second phase of the suit. A final decision from the CIT is expected some time in 2007.

A.J. Tharakan, president, Seafood Exporters Association of India [SEAI] told Business Standard that the preliminary ruling would impart a much easier exports to the US since bond would not be required as per the order.

He a said SEAI had also filed a suit with the CIT which is yet to be considered. " We feel that the present ruling may positively influence our case", he added.