DeHeng Help Two Leading Glass Producers Win
the Safeguard Investigations Initiated by Philippines
2020-08-20
On August 19, 2020, the Department of Trade and Industry (DTI) issued the Department Administrative Order in the matter of the application for general safeguard measures on the importation of reflective, tinted and clear float glass from various countries by which the DTI determined that no definitive general safeguard measures shall be imposed and hereby dismissed the Petitioner's application. All cash bonds that may have been imposed as provisional duties shall be immediately returned to the concerned importers. It's been a great success for both DeHeng and the two clients Xinyi Energy Smart (Malaysia) Sdn Bhd ("Xinyi") and Kibing Group (M) Sdn Bhd ("Kibing").
Case Review
On February 19, 2019, the DTI initiated a safeguard investigation concerning imports of clear and tinted float glass from various countries. Float glass is widely used for architecture, mirror, furniture & decorations, optical instrument and automobiles. Two phases have been conducted by the Philippine Authorities, namely preliminary investigation by the DTI and formal investigation by the Tariff Commission (TC).
On behalf of Xinyi and Kibing who had designated DeHeng as legal representative, DeHeng registered with the Authority at the beginning of the investigations. Xinyi Energy Smart (Malaysia) Sdn Bhd is one of the large oversea production bases of Xinyi Glass Holdings Limited, the world's leading integrated glass manufacturer. Kibing Group (M) Sdn Bhd, a subsidiary of Kibing Group, is one of the earliest domestic float glass enterprise investment in southeast Asia. Participation in the investigation has been of great significance to the whole float glass industry in Malaysia.
Based on previous experiences and characteristics of the instant case, DeHeng developed the following defense strategy. On the one hand, following deep research and careful analysis of the Petitioner's production, capacity, operation and other economic parameters as disclosed by the DTI's Initiation Report and indicated by other available sources as well as information about the current performance, increase in imports and future development of Philippine domestic float glass industry, DeHeng has filed complete and elaborated submissions to the Authority. On the other hand, DeHeng has suggested and helped Xinyi and Kibing uniting with Philippine importers, local glass associations, as well as other interested parties in opposition to the Petitioner's claims. In addition, DeHeng team has attended the preliminary conference organized by the TC in Manila, Philippines.
Having submitted successive position papers before the Authority, DeHeng's claims during the whole process mainly focused on the following four perspectives. Firstly, appropriate evaluation of increase in imports to Philippines shall be made; secondly, the petitioner's allegations of serious injury or threat thereof are baseless; thirdly, imposing safeguard duties will cause damage to public interests of Philippines; lastly, there has been no unforeseen development which is one of the requisites for seeking safeguard measures.
With joint efforts of DeHeng and Xinyi & Kibing in defense for the instant investigation, the TC in its Final Report as released on June 29, 2020 has concluded that the domestic industry has suffered no serious injury or threat thereof during the period of investigation and has hereby terminated its formal investigation without recommending any safeguard measures. Later on August 19, the DTI dismissed the Petitioner's application and decided no definitive general safeguard measures shall be imposed on importation of the products under consideration and all cash bonds imposed shall be immediately returned to the concerned importers.
Case Summary
DeHeng's clients, Xinyi and Kibing, are both leading glass manufacturers in Malaysia and successful examples of foreign investments made by Chinese enterprises whose operations are closely connected with the development and prospect of both Malaysian and Chinese float glass industries. DeHeng's victory in this case helps Xinyi and Kibing maintain their competitive edge and to further increase their market share in Philippine market. It also encourages other enterprises in face of protectionism to seek legal services and to lower the chance being involved into trade remedy investigations by gaining a new share in the global market.
Headed by Partner Ren Yongzhong and supported by Wu Huimin and Tong Bo, DeHeng team has been working closely with Xinyi and Kibing all the way. The clients appreciated DeHeng's professionalism in International Trade and the team's rigorousness and attentiveness. DeHeng will be dedicated to providing better legal service and support to more clients in future.
