LG Electronics Inc v Minister for Justice and Customs

4 The legislative scheme reflected in the above flowchart is described in Inglewood Olive Processors Limited v Chief Executive Officer of Customs [2005] FCAFC 101 at [7]‑[17]. We adopt that description. It need not be set out again here. 5 In the present case the application under s 269TB of the Customs Act 1901 (Cth) ('the Act') that initiated the process represented in the flowchart was made on 25 June 2002 by Fisher & Paykel Australia Holdings Limited ('F & PAH'). The application requested the Minister to publish a dumping duty notice in respect of the Goods. 6 A screening report dated 9 July 2002 was prepared by the Australian Customs Service ('Customs') pursuant to s 269TC of the Act. The report discussed the structure of the Fisher & Paykel group of companies. It noted that Fisher & Paykel Manufacturing Pty Limited ('F & PM'), a wholly owned subsidiary of F & PAH, produces 'like goods' within the meaning of s 269TB of the Act although F & PAH itself does not. The report stated: 'For injury purposes the applicant has presented data from F & PA [Fisher & Paykel Australia Pty Limited] and F & PM in an amalgamated form. Discussions with our policy area advised that it is reasonable, for the purposes of assessing injury, to view the Fisher & Paykel group of companies in Australia (F & P) as a single corporate entity. I agree with this approach. It would be impractical to assess injury to F & PM only and to do so would be to disadvantage the applicant on the basis of its corporate structure.' 7 The author of the screening report concluded that the application met the requirements of s 269TC of the Act. He or she recommended that the CEO give public notice of the initiation of an investigation as required by s 269TC(4). The CEO gave that notice on 12 July 2002. 8 During the course of the investigation a 'Preliminary Normal Value Report' was published concerning LGE. The authors of this document reported that: 'We found that overall the [goods under consideration] were not exported to Australia by LGE at dumped prices.' 9 The statement of essential facts ('SEF') required by s 269TDAA of the Act was published on 17 December 2002. It recorded a finding that LGE had not exported the Goods to Australia at dumped prices. It noted the requirement of s 269TDA(1) of the Act and stated: 'The results of Customs' investigation, as set out above, show that the provisions of s 269TDA(1) have been satisfied for LGE. Therefore, subject to the Minister's determination in respect of dumping, Customs will recommend termination of the investigation in respect of LGE.' 10 By letter dated 6 January 2003 the then legal representatives of LGE requested the CEO to terminate the investigation in respect of LGE immediately. The CEO did not do as requested but rather, on that and later occasions, the CEO sought additional information from LGE which it provided. LGE reiterated its request that the investigation in respect of it be terminated a number of times including as late as 3 September 2003. 11 In the meantime, on 31 January 2003 Trade Measures Report No 63 ('Report No 63') was provided to the Minister. Report No 63 sets out the results of the investigation initiated by the application made under s 269TB of the Act. The recommendation made to the Minister by Report No 63 was that he: 'impose anti‑dumping measures in respect of fully automatic washing machines (not exceeding 12 kg capacity) and like goods exported from Korea other than by LGE and take anti‑dumping action pursuant to s 269TG(2) of the Act.' 12 F & PAH was dissatisfied with Report No 63 and expressed its concerns to the Minister. The Minister instructed the CEO to examine additional information and submissions provided by F & PAH and to consider any comments that LGE might wish to make on the additional material. 13 On 17 September 2003 notice was given pursuant to s 269TG(2) and s 269TL that the Minister had accepted the recommendation made by Report No 63. F & PAH applied in accordance with s 269ZZA of the Act for a Trade Measures Review Officer ('TMRO') to review the decision of the Minister. Daewoo Electronics Co Limited ('Daewoo') also sought review of the decision of the Minister. 14 The TMRO, by a report dated 1 March 2004, recommended that the Minister direct the CEO to reinvestigate certain matters including: · adjustments for components in establishing normal values for LGE; · adjustments for advertising in establishing normal values for LGE and Daewoo; · material injury to the Australian industry; and · whether dumping has caused material injury to the Australian industry.

The Minister accepted the recommendation of the TMRO.

15 Trade Measures Branch Report No 83 ('Report No 83') dated 23 August 2004 presents the results of the reinvestigation by Customs. On reinvestigation Customs found that LGE had engaged in dumping and that dumped exports of washing machines to Australia by Daewoo, Samsung and LGE caused material injury to the Australian industry producing like goods. 16 On 31 August 2004 the Minister accepted the findings in Report No 83, revoked the dumping notice of 17 September 2003 and made a new declaration under s 8 of the Anti‑Dumping Act. On 6 September 2004 Customs gave notice under s 269ZC(5) of the Act that it had commenced a review of anti‑dumping measures in relation to washing machines exported from Korea. 17 On 5 October 2004 the proceeding giving rise to this appeal was commenced.

decision of the primary judge 18 The primary judge rejected the contention that the Decision was affected by jurisdictional error because the CEO failed to terminate the investigation so far as it related to LGE as required by s 269TDA(1) of the Act. His Honour noted that s 269TDA(1) was not self executing and that had the CEO decided that the occasion for its operation had arisen he would have been required to issue a notice informing F & PAH of its right to have the Decision reviewed. His Honour concluded that the investigation in so far as it related to LGE was never terminated under s 269TDA(1). 19 His Honour also rejected the contention that the Minister did not take into account the considerations required by s 269TAE(2A) of the Act. Section 269TAE(2A) required the Minister to consider whether injury to the Australian industry was being caused by factors other than the exportation of the Goods. His Honour noted that assessment of material injury is a practical exercise and there was no need for the Minister to address theoretical factors not suggested to have any application to the circumstances of the case. 20 The primary judge was satisfied that the decision was not invalidated by any failure properly to identify the 'Australian industry in respect of like goods'. He rejected the contention that Report No 83 wrongly directed attention to whether the Fisher & Paykel group of companies in Australia had suffered material injury. 21 Finally, his Honour concluded that LGE had not been denied procedural fairness but rather that the relevant requirements of the Act had been scrupulously observed.

issues on appeal 22 On this appeal the following issues were argued: (a) whether the CEO was satisfied at any relevant time that LGE had not dumped any of the Goods; (b) if the CEO was so satisfied, what consequences flow from his failure to terminate the investigation so far as it related to LGE; (c) whether the Minister made an error in law in his construction of 'Australian industry' by relying on findings made by Customs that F & PAH or alternatively the Fisher & Paykel group of companies in Australia suffered material injury; and (d) whether the Minister failed to consider, as required by s 269TG(2) and s 269TAE(2A) of the Act, whether the dumping of Goods by LGE caused the loss of market share found to have been suffered by the Australian industry producing like goods and whether there were other causes.

Issues (a) and (b) - Section 269TDA(1) 23 Section 269TDA(1) relevantly provides: 'If: (a) application is made for a dumping duty notice; and (b) in an investigation, for the purposes of the application, of an exporter to Australia of goods the subject of the application, the CEO is satisfied that: (i) there has been no dumping by the exporter of any of those goods; … the CEO must terminate the investigation so far as it relates to the exporter.' 24 The SEF published by the CEO pursuant to s 269TDAA on 17 December 2002 includes a statement that the dumping margin for LGE product for the investigation period was in the range 0% to -10%; ie that there had been no dumping by LGE of any Goods. The same statement appears in Report No 63 which was published on 31 January 2003. 25 LGE submitted that the only reason that the CEO did not, on or about 17 December 2002, terminate the investigation so far as it related to LGE was his erroneous view that he could not do so ahead of the Minister making a determination in respect of dumping. In Pilkington (Australia) Ltd v Minister for Justice and Customs [2002] FCA 770, which was published on 18 June 2002, Moore J at [13] had stated that it was not clear why the CEO apparently regarded a ministerial determination that goods had not been dumped as a precondition of the power vested in the CEO by s 269TDA(1). It is now accepted by the CEO that a ministerial determination is not necessary before the CEO may terminate an investigation in reliance on s 269TDA(1). 26 The respondents' submissions drew a distinction between a 'view' formed by the CEO on material then available to him that dumping by a particular exporter had not occurred and 'satisfaction' that there had been no dumping by the exporter within the meaning of s 269TDA(1). The respondents argued that the SEF was published, as required by s 269TDAA, for the purpose of eliciting submissions (see s 269TEA(3)(a)(iv)). They submitted that, for this reason, views expressed in a SEF are necessarily preliminary. The respondents also placed weight on later requests made to LGE for further information relevant to a determination of whether or not LGE had engaged in dumping as indicating that the CEO was not in fact satisfied that LGE had not engaged in dumping. 27 The primary judge found it unnecessary to determine whether the CEO was satisfied on or about 17 December 2002, or at any relevant time, that there had been no dumping by LGE. His Honour concluded that, as the investigation had not in fact been terminated so far as it related to LGE, the issue of whether the CEO was satisfied that there had been no dumping by LGE had no practical significance. 28 It is apparent that a reason why the CEO did not terminate the investigation so far as it related to LGE on or about 17 December 2002 was that he regarded a ministerial determination concerning dumping to be a precondition of his power to do so. However, in our view, the evidence before the primary judge was insufficient to prove that the CEO was satisfied, at any time earlier than about the time of the publication of Report No 63, that there had in fact been no dumping by LGE. We accept the submission of the respondents that it is not necessarily to be inferred from the content of the SEF that the CEO was so satisfied. It is equally open to be inferred that the statement in the SEF that LGE had not exported the Goods to Australia at dumped prices was an expression of a tentative view from which the CEO was open to be moved by submissions made in response to the publication of the SEF. 29 Report No 63 reports the findings of the investigation as required by S 269TEA. Section 269TEA(1) imposes on the CEO an obligation to give the Minister a report after holding an investigation in respect of an application under s 269TC. Thus, by the time that Report No 63 was given to the Minister the investigation had come to an end. A termination of the investigation so far as it related to LGE, or any other exporter, under s 269TDA(1) was by then no longer possible. LGE's complaints concerning the CEO's continuing failure to terminate the investigation on dates later than the date that Report No 63 was given to the Minister for this reason lack substance. 30 Although our above conclusion renders it strictly unnecessary to decide the point, we consider it appropriate to record that we do not accept the contention advanced by LGE that, irrespective of whether the CEO complied with the obligation under s 269TDA(1) to terminate the investigation, it was terminated so far as it related to LGE in any event. LGE argued that, upon forming the satisfaction that there had been no dumping by LGE, the CEO was deprived of jurisdiction to continue his investigation of LGE. As the respondents pointed out, such a construction of the Act would place LGE in a better position than if a termination decision had been made; it would have gained the benefit of a termination decision without F & PAH being able to seek review of the decision. In our view, the Act does not disclose an intention that an inquiry that continues in breach of s 269TDA(1) is invalid (Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 390). As the primary judge observed, the subsection does not provide that, upon the CEO forming the requisite satisfaction, the inquiry is deemed to be terminated in respect of the relevant exporter. Rather, the subsection requires the CEO to act to terminate the investigation. 31 Further, even if LGE were able to establish that the CEO was satisfied on or about 17 December 2002 that there had been no dumping by LGE, it was, in our view, manifestly too late by the time the proceeding before the primary judge was initiated for LGE to complain of the CEO's failure to terminate the investigation and to contend that all steps taken thereafter concerning LGE were invalid. The flowchart in [3] above illustrates how early in the process leading towards a declaration that s 8 of the Anti‑Dumping Act applied to the Goods any termination of the investigation in respect of LGE would have occurred. LGE in fact allowed that process to be completed before making any legal challenge to the failure of the CEO to terminate the investigation in respect of LGE. 32 The relief sought by LGE under the ADJR Act, or alternatively s 39B of the Judiciary Act, in respect of the CEO's failure to terminate the inquiry in respect of LGE is discretionary relief. As mentioned above, despite being aware of the obligation imposed on the CEO by s 269TDA(1), as its numerous demands that the CEO terminate the inquiry in respect of LGE reveal that it was, LGE took no steps, by way of an application for a writ of mandamus, under s 7 of the ADJR Act or otherwise, to compel the CEO to make a decision to terminate the inquiry in respect of it. Had the CEO decided to terminate the inquiry in respect of LGE, he would have been required to give public notice of the decision (s 269TDA(15)). F & PAH could thereupon have applied for review of the CEO's decision by the TMRO (s 269TDA(15)(c)). In our view, even if LGE were able to demonstrate jurisdictional error on the part of the CEO in continuing the investigation in respect of LGE after 17 December 2002, the relief LGE seeks, which would have the effect of treating the investigation as having been terminated as a matter of law, should be refused on discretionary grounds.

Issue (c) - Australian Industry 33 Section 269T(4) identifies the circumstances in which there is an 'Australian industry' in respect of like goods. The subsection provides: '(4) For the purposes of this Part, if, in relation to goods of a particular kind, there is a person or there are persons who produce like goods in Australia: (a) there is an Australian industry in respect of those like goods; and (b) subject to subsection (4A), the industry consists of that person or those persons.' 34 LGE contended that the Minister asked himself the wrong question in determining whether he was satisfied that 'material injury to an Australian industry producing like goods' had been caused within the meaning of s 269TG(1)(b) of the Act. LGE submitted that the Minister relied upon findings to the effect that F & PAH or the Fisher & Paykel group of companies in Australia suffered material injury when the right question was whether F & PM suffered material injury. 35 The respondents contended that the primary judge correctly found that the decision of the Minister was not affected by error in this regard. 36 As mentioned in [6] above, the enquiries by Customs proceeded on the basis that it was reasonable to view the Fisher & Paykel group of companies in Australia as a single corporate entity for the purpose of assessing injury. Reports Nos 63 and 83 referred to data from 'F & P' and made findings of injury to 'F & P'. On a fair reading of those reports they generally use 'F & P' to refer to the Fisher & Paykel group of companies in Australia. The Fisher & Paykel group of companies in Australia apparently comprises a holding company and its three subsidiaries: a manufacturing subsidiary, a sales and administration subsidiary and an after‑sales customer service subsidiary. 37 In Enichem Anic Srl v Anti‑Dumping Authority (1992) 39 FCR 458 at 469 Hill J, with whom Gummow and O'Connor JJ agreed, observed: 'Decision-making is a function of the real world … Ultimately, a decision-maker must do the best on the material available after giving interested parties the right to be heard on the question.' 38 Report No 63 records the following conclusion with respect to material injury to the Australian industry producing like goods: '… Customs concluded the Australian industry producing like goods had, during the injury period, suffered injury in the following forms: · price undercutting; · price depression; · loss of market share; · profits foregone and loss of profitability; and · under utilization of capacity.' 39 The respondents acknowledged that Customs did not make a finding of price related material injury resulting from the Goods exported by LGE. This acknowledgment renders LGE's complaints concerning Customs' reference to the Fisher & Paykel group of companies in Australia of little, if any, practical significance. The finding of material injury to the Australian industry caused by dumping by LGE was a finding of volume related injury. 40 LGE did not identify by its submissions how Customs' reference to the Fisher & Paykel group of companies in Australia could have undermined the integrity of the finding of volume related material injury. 41 We can identify no reason for thinking that it did so. For example, Report No 63 included a finding concerning underutilization of capacity. This finding was based upon a conclusion that a particular plant (presumably operated by F & PM) had never run at full capacity. Plainly the corporate structure of the Fisher & Paykel group of companies in Australia was irrelevant to this finding. 42 We reject the contention that the Minister asked himself the wrong question in determining whether he was satisfied that there had been material injury to the Australian industry producing like goods.

Issue (d) - Whether Injury Caused by LGE 43 Section 269TG authorises the Minister to declare that s 8 of the Anti‑Dumping Act applies to goods where the Minister is satisfied that, in effect, the goods are being dumped in Australia and material injury to the Australian industry is being caused by that dumping. Section 269TAE(1) identifies matters to which the Minister may have regard in determining whether material injury to the Australian industry is being caused. Section 269TAE(2A) requires the Minister to consider whether any injury to an industry is being caused by factors other than the exportation of the dumped goods. Subsection (2A) identifies other factors that might cause injury to the industry. These factors include the volume and price of imported like goods that are not dumped, changes in patterns of consumption and developments in technology. 44 In ICI Australia Operations Pty Ltd v Fraser (1992) 34 FCR 564 at 571 a Full Court observed: '… the subject matter of s 269TG(1) is not material injury to an Australian industry in the abstract, but material injury causally connected to, "by reason of" or "because of", dumping. By whatever steps the deliberations occur during which the Minister has regard to the matters relevant to the determination of "material injury", whether they be matters enumerated in s 269TAE(1) or otherwise, the ultimate issue for the Minister is whether he or she is satisfied that there has been material injury causally connected in the manner required by the legislation to the dumping of goods that have been exported to Australia.' 45 LGE contended that a fair reading of the material injury findings of Report No 83 is that price related injury was attributable only to exports by Daewoo and Samsung. It was argued that because Report No 83 contains no statement to the effect that the export of LGE's goods 'at dumped prices' was the cause of material injury, nor any statement ruling out the possibility of injury being caused by other factors, it is to be inferred that these matters were not considered. Reliance was placed on Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 at 346. 46 Report No 83 can only be understood in the light of the circumstances that led to its preparation. As mentioned above, Report No 63 concluded that LGE had not engaged in dumping. Report No 63 nonetheless included the following findings: '… Australian industry's prices and those of other importers of Korean washing machines were consistently undercut by the prices of Samsung and Daewoo washing machines. Although imports from Samsung and Daewoo constituted a relatively small volume of imports Customs considers, because of the price sensitivity of the washing machine market, that such consistent price undercutting would have significantly affected prices.' 47 The finding of Report No 63 concerning material injury as a result of dumping was that: 'From the available evidence Customs concluded that price related material injury suffered by Australian industry was caused by washing machines exported from Korea by Samsung and Daewoo at dumped prices. Customs further concluded that volume related material injury suffered by Australian industry was caused by exports from Korea but not by exports from Korea at dumped prices.'

We interpolate that the second of the above conclusions was necessarily a finding that the volume related material injury was caused by goods exported from Korea by LGE. It is not in dispute that there are only three exporters of washing machines from Korea to Australia.

48 Report No 63 gave explicit consideration to possible causes of injury other than dumping. It noted rationalisation in the Australian industry and competition between Australian industry participants and between different brands produced by the same manufacturers. It concluded that these factors would have contributed to reduced prices. 49 Following the publication of Report No 63 the Minister accepted a recommendation from the TMRO that he direct the CEO to reinvestigate certain matters including matters relevant to the conclusion that LGE had not engaged in dumping. Following a reinvestigation of these matters Customs concluded in Report No 83 that LGE had engaged in dumping. Report No 83 also includes the following findings and conclusions: 'The volume of dumped goods from Korea becomes significantly larger when exports by LGE are included. Customs does not consider that the legislation requires a separate causal link to be found for each exporter from a country of export. However, as the original report focussed on the causal link between material injury and dumping by Daewoo and Samsung, Customs must now assess whether dumped exports, including those exported by LGE, caused material injury to the Australian industry. In the report of its original investigation (Trade Measures Report No 63), Customs concluded that the Australian industry had lost, and Korean exports had significantly gained, market share during the period. Customs concluded the increased exports from Korea were responsible for the majority of Australian industry's loss of market share. Analysis of Korean exports, which increased fourteen fold from 1997 to mid‑2002 (extrapolated), demonstrates that the increase was mainly due to exports from LGE. Customs concluded that volume related material injury suffered by Australian industry was caused by LGE's exports from Korea. Having re‑examined the relevant information, Customs finds that dumped exports from Korea by LGE, Daewoo and Samsung caused material injury to the Australian industry in the form of price undercutting, price depression, loss of market share, lower unit profits and under utilisation of capacity. Conclusion Customs finds that dumped exports of washing machines to Australia by Daewoo, Samsung and LGE caused material injury to the Australian industry producing like goods.' 50 The statement that the legislation did not require a separate causal link to be established for each exporter from a country of export anticipated the effect of a legislative amendment that was not in operation at the relevant time (see s 9 of the Customs Legislation Amendment Act (No. 1) 2003 (Cth)). 51 As mentioned above, the respondents acknowledge that the correct reading of Report No 83 is that Customs did not make a finding of price related material injury arising from the Goods exported by LGE - although it did not reach a conclusion that LGE had not contributed to such injury. Nonetheless, the references in Report No 63 to the price sensitivity of the Australian washing machine market and to volume related injury inferentially caused by exports from LGE indicates that LGE Goods were being sold at prices at least comparable to the prices of Daewoo and Samsung Goods. That is, that the material injury being caused by the export of LGE Goods was caused by LGE's low prices - albeit that LGE was not at that time regarded as dumping the Goods. Subsequently, as Report No 83 reveals, Customs reached a conclusion that LGE had engaged in dumping. As a consequence the earlier finding that volume related material injury was being caused by the export of LGE Goods at low prices became a finding that volume related material injury was being caused by the export of LGE Goods at dumped prices. 52 Report No 83, as the above extract reveals, indicates an awareness in Customs of the need to establish a causative link between the export by LGE of the Goods at dumped prices and material injury to the Australian industry. The conclusion in Report No 83 on the issue of material injury is that 'dumped exports of washing machines to Australia by Daewoo, Samsung and LGE caused material injury to the Australian industry producing like goods'. Having regard to the terms of Reports Nos 63 and 83 we see no reason to conclude that the author of the report overlooked the requirement identified in Report No 83 that the volume related material injury suffered by the Australian industry be not only caused by the export of LGE's Goods but by their export at dumped prices. Nor do we see any reason to conclude that the Minister overlooked this requirement. 53 LGE placed reliance on the absence in Report No 83 of reference to factors upon which it had relied in submitting to Customs that the loss of market share suffered by the Australian industry may have been attributable to other causes. It identified, for example, the fact that the Australian industry does not produce the increasingly popular front loading washing machines and that exports from countries other than Korea amount to about two‑thirds of total exports of washing machines to Australia. 54 Report No 83 characterises the market for washing machines in Australia as 'transparent, competitive and price sensitive'. We see no reason to conclude that Report No 83, and thus the Minister, gave no consideration to the possibility that causes other than dumping were entirely responsible for the decline in market share of the Australian industry. This possibility had been considered and reported upon in Report No 63 (see [48] above). It was not necessary that the issue be reported on again in Report No 83.

conclusion 55 In our view, no error in the judgment of Whitlam J has been identified. The appeal will be dismissed with costs. I certify that the preceding fifty-five (55) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Wilcox, Branson and Merkel.

Counsel for the Appellants: M Speakman SC and S Lloyd

Solicitor for the Appellants: Corrs Chambers Westgarth

Counsel for the Respondents: M Perry QC and G Kennett