On 9 March 2010, South Africa's Constitutional Court ruled on an anti-dumping matter that will have an impact on all future anti-dumping duties, especially sunset reviews.

The matter has a rather lengthy history but may be summarised as follows. As far back as 2000, Scaw South Africa (Pty) Ltd ("Scaw") applied to have anti-dumping duties imposed on stranded wire, rope and cables originating in or imported from the People's Republic of China, Germany, India, Korea, Spain and the United Kingdom. Scaw also applied to have countervailing measures imposed on these products originating from India and Korea, but this is irrelevant to the Constitutional Court's decision as the decision only related to anti-dumping duties.

After investigating the application the International Trade Administration Commission of South Africa ("ITAC") found that the products where being dumped and imposed anti-dumping duties in 2002 on the products originating from the above-mentioned countries. ITAC specifically found that one company exporting from the United Kingdom, Bridon International Limited ("Bridon"), was dumping its products and imposed an anti-dumping duty of 42,1%.

During 2006 Bridon, in an attempt to either remove or reduce the anti-dumping duties imposed against them, applied for an interim review of its anti-dumping duty alleging that there were significantly changed circumstances which necessitated a review of the anti-dumping duty applicable to Bridon. After investigating the interim review, ITAC decided to terminate the interim review as there were no significantly changed circumstances and recommended that the anti-dumping duties imposed against Bridon should be maintained. As a result the original anti-dumping duties were in fact maintained and these duties were expected to expire on 28 August 2007. This is due to the fact that anti-dumping duties may only remain in force for 5 years from the date of imposition unless a sunset review has been initiated in which the continued imposition of the anti-dumping duties are requested and found to be appropriate.

More than 6 months prior to the expected lapse of the anti-dumping duties, ITAC informed all interested parties that they would have to initiate a duly substantiated sunset review application, failing which the anti-dumping duties would lapse. Pursuant thereto Scaw did submit such a sunset review application and ITAC investigated the application. In a new development, to our mind questionable, ITAC decided that in some instances the anti-dumping duties should be increased pursuant to the sunset review. ITAC also decided that anti-dumping duties imposed against Bridon should be removed. It is against this decision of ITAC that Scaw then sought an interdict in order to prevent ITAC from recommending its decision to the Minister of Finance (who imposes the anti-dumping duties, or in this instance who would remove the anti-dumping duty imposed against Bridon).

The High Court granted the interdict to Scaw and the interdict was to remain in force pending the finalisation of a review which Scaw should institute. The purpose of this review application was to review the decision of ITAC. Although this review application was initiated by Scaw, it was still pending when this matter came before the constitutional court.

There are four reasons why this case was heard before the constitutional court. Firstly the interdict had the effect of restraining the minister from exercising its executive powers conferred upon them by the Constitution and national legislation.

Secondly the effect of interdict was to extend the lifespan of the anti-dumping duties beyond that allowed by South Africa's national legislation (the International trade Administration Act and the Anti-dumping Regulations) and as a consequence hereof being inconsistent with South Africa's international obligations as a contracting party on the Agreement on Implementation of Article VI of GATT, 1994 ("WTO Anti-dumping Agreement").

Thirdly the interdict brings to the fore the issue of separation of powers between the courts and the national executive and the issue of the potential breach of the state's international obligations in relation to international trade. The argument is that the setting, changing or removal of an anti-dumping duty is a policy-laden executive decision that flows from the power to formulate and implement domestic and international trade policy. That power resides in the heartland of national executive authority and the question is whether the courts should interfere.

Fourthly Scaw invoked the procedural rights under the Promotion of Administrative Justice Act which is founded on the constitutional right to fair administrative action.

The Constitutional Court found that interdict indeed had the effect of extending the lifespan beyond that which is allowed in terms of national legislation and South Africa's international obligations. This is due to the fact that anti-dumping duties will only remain in force for 5 years. Interestingly South Africa has been challenged on this point in the WTO's rules committee on occasion. Scaw argued that they are allowed to review a decision of ITAC and this may thus ?extend' the lifespan of the anti-dumping duty. However the Constitutional Court held that Scaw, or any future party, will have to institute its review application of a decision by ITAC before the expiration of the 5 year period if it wanted to maintain the anti-dumping duty for an uninterrupted period. However, it cannot institute a review proceeding in which will have the effect of extending the lifespan of the anti-dumping duty. The anti-dumping duty will be removed, but may be reinstituted after the review application has been concluded successfully. Furthermore any investigation held by ITAC, which has not been concluded, may not have the effect of extending the lifespan of the anti-dumping application.

On the question of separation of powers, the Constitutional Court found that the courts cannot, by granting the interdict in this instance, usurp the power or function given to the executive by making a decision of their preference, in this instance to extend the lifespan of the anti-dumping duties.

The Constitutional Court therefore set the interim interdict aside based on the above reasoning. It is therefore very important for parties to monitor their current anti-dumping duties and sunset review investigations especially where such parties would like to maintain the anti-dumping duties for an uninterrupted time period. The Constitutional Court should also be commended as this ruling brings SA into better conformity with its WTO obligations.

What the judgement does not settle and this is the subject of ongoing litigation, is as regards the question as to whether an ant-idumping duty can be increased beyond its initial level pursuant to a sunset review.